IFA & ICMSA Agree Package for Landowners Along Route for Shannon Pipe
The Irish Farmers Association (IFA) and the Irish Creamery Milk Suppliers Association (ICMSA) have today (Wed, Sept 10th) reached agreement with Uisce Ėireann (UE) on a voluntary land and wayleave package for farmers and landowners along the route of the pipeline for the Water Supply Project Eastern and Midlands Region (WSP).
The package contains four main elements – an early sign on payment; a wayleave payment; a crop loss and disturbance payment; and an WSP special goodwill payment. There are additional payments in the package for farmers who will have ancillary apparatus such as air valves, line valves, wash outs chambers and lay-bys on their land.
Farmers have the option of accepting this offer under the negotiated voluntary wayleave agreement with Uisce Ėireann, or pursuing their claim through the relevant statutory processes.
The deadline date for the return of consent forms to UE has been extended from September 23rd to October 7th to provide more time for farmers and landowners to consider the package and get the necessary advice.
In relation to concerns raised regarding the payment of VAT, the IFA and ICMSA have received the following undertaking from UE.
“The obligation to determine the tax treatment of the wayleave package rests with the landowner. It is the understanding of Uisce Éireann that only the permanent easement element (inclusive of ancillary infrastructure) is potentially subject to VAT, and we are not aware that any other elements of the package are subject to VAT. If it is determined that other elements are subject to VAT and if it is shown that VAT should be applied to any other or all components of the package, we will refund the VAT in full once provided with a VAT invoice from the landowner concerned.”
The IFA and ICMSA have sought further advice and guidance on VAT, particularly the situation in respect of unregistered farmers and this is a matter that all parties need to work on and get clarified as soon as possible.
During the negotiations which involved over 25 meetings, the IFA and ICMSA expressed concerns about the implications for farmers if there are long delays to the planning or with the pipeline being completed. The package provides for inflation with CPI indexation for the payments which are not made upfront such as the crop loss and disturbance payments and also provides for CPI Indexation for the WSP goodwill payment from 2030.
While farmers along the route will ultimately have a 20m wide wayleave corridor on their land, a 50m wide corridor will be required during the construction phase. During pre-planning and until the project is complete, the full 50m wide corridor will be subject to the wayleave development restrictions. However, outside of the construction period, normal agriculture use of the corridor will not be affected.
Considering the significant delays in completing major state infrastructure projects, there is a real concern that farmers could be left in limbo for a long time.
Given the availability of the permanent wayleave payment upfront for farmers under the package and the nature of the wayleave and easement required at an early stage by UE, the issue of protecting farmers from potential significant delays with planning or construction remained unresolved in the negotiations.
However, the IFA and ICMSA will continue to work with UE for the duration of this project in order to protect the interests of farmers if this project is unduly delayed.
The IFA and ICMSA also raised the issue of the potential for TB disease breakdowns due to wildlife displacement during construction. A working group including the IFA and ICMSA along with the Department of Agriculture will be established to plan around this.
The package specifies that the crop loss and disturbance payment is an advance payment and UE will cover all loss of earnings, other damages and disturbance incurred when they are computed by an appointed agronomist.
The IFA and ICMSA said that like any complex negotiation, they had not secured everything looked for in the negotiations. However, on balance the compensation and goodwill payments provide a reasonable package for farmers and they should consider the deal carefully with their relevant advisers.
The IFA and ICMSA negotiated very hard over a number of months and the negotiating teams had access to appropriate professional and legal advice. UE has agreed to contribute towards the costs of the IFA and ICMSA in engaging these experts.
As part of the farmer/landowner package, there is also a comprehensive Code of Practice and the Uisce Ėireann Deed of Wayleave and Easement, which contains a loss of development clause. The package also provides for the costs associated with the farmers/landowners receiving independent legal advice on the Deed of Wayleave and Easement and associated legal issues.
