Rates on the up
Waipā District Council has asked the Government for a staged implementation of a rates cap.
Roger Gordon
The majority of councillors sitting on the council’s Strategic Planning and Policy Committee approved a council submission this month supporting the Government’s objectives to cap local government spending at four per cent.
Tier 1 growth councils, including Waipā, were not operating in a ‘steady state’ environment, so applying a steady state rating model too early created material financial, infrastructure delivery, and service delivery risks, the council submission said.
“Depreciation costs arising from rapid asset base expansion, largely driven by national policy and growth obligations, are the largest and least flexible cost driver for high growth councils.
“Core infrastructure costs are unavoidable, often driven by external requirements, and should be explicitly recognised or appropriately exempted within any rates target framework for example, stormwater.”
Clare St Pierre
“Given these factors, a slower and staged transition to the proposed rates target model should occur before binding caps are applied, supported by monitoring and adaptive mechanisms to respond to emerging impacts.”
Pirongia ward councillor Clare St Pierre, who proposed the submission be sent to the Government, said she had reservations about whether it would achieve its intent.
She described the Government’s proposal as “half-baked”.
Chief executive Steph O’Sullivan told the committee council had been told the Government would review the submissions using AI “and they will move at a pace”.
Steph O’Sullivan
Mayor Mike Pettit said the council was “not that far away” from achieving the Government’s target of four per cent.
“The four per cent is challenging, but anything is possible,” he said.
Cambridge ward councillor Roger Gordon was the only committee member to vote against the submission.
“I don’t think that all of the time I have been in council there has ever been a steady state,” he said. “There’s always something that comes out of the woodwork. I don’t think that waiting for a steady state is critical.
“I am in favour of rates capping because I think that something has to be done to stop the incredible history of rates increases, and we’ve been as much to blame, an average of 10 per cent over the last five years I think is unsustainable.”
How high can rates go? Photo: RDNE Stock, Pexels.com
