By Maeve Rowan
The Supreme Court has confirmed that two privately operated care facilities in Counties Meath and Tipperary are exempt from commercial rates because their expenses are, for all practical purposes, funded by the State.
The ruling concerns Redwood Extended Care Facility, which operates a six-bedroom property outside Stamullen caring for adults with intellectual disabilities or acquired brain injuries, and Nua Healthcare Services Limited, which operates Millview at Kiltinan, Co Tipperary, providing 24-hour care for four children with disabilities and complex support needs.
Both facilities receive funding under arrangements with the HSE, with Nua also receiving funding from TUSLA. The Valuation Tribunal had ruled that the properties were exempt under paragraph 14(b) of Schedule 4 to the Valuation Act 2001, and the High Court upheld those decisions.
Tailte Éireann appealed directly to the Supreme Court, arguing that the State did not “defray” the operators' expenses because it paid an agreed price for services rather than directly reimbursing or vouching individual costs.
Mr Justice Brian Murray rejected that interpretation. He held that the statutory wording focuses on the source of the money used to meet the expenses, not on whether the HSE formally approves or reimburses each individual cost.
The court also held that the exemption is capable of applying to profit-making private operators where they provide care services that the HSE or another State agency could otherwise provide itself.
However, the judgment clarified that “wholly or mainly” funded by the Exchequer does not simply mean anything over 50%. The facility must, in substance, be funded almost entirely by the State, allowing only a small contribution from private sources.
On the facts, Redwood received all of its relevant funding from the HSE, while Nua's Millview facility received all of its income from the HSE and TUSLA. The appeals were dismissed and both properties remain non-rateable.