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Proposed rates increase kept as low as possible

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This year’s Wairoa District Council rates are not expected to rise above an average of 5%.

Wairoa Mayor Craig Little said the 2020/21 rates have not yet been set, but the indication is the increase will not be more than a five percent average across the district.

Mr Little explained that for the second year in a row Council has a deficit between what it costs to run the district and the income Council receives.

However, this deficit is not being passed onto ratepayers. In fact, it is the opposite with Council absorbing the difference.

“Each year a budget is developed to forecast expenses. Income, such as subsidies, Council generated revenue and rates is then put against the expenses.

“Council has been adamant it did not want any average rates increase to be above 5%, but to maintain that it means there is a gap between what we spend and what we make.

“So instead of passing that deficit onto ratepayers, at an average of $300 per property, Council has looked for alternative ways of absorbing the difference.”

Mr Little said managing the shortfall includes not collecting rates in 2020/21 to cover wear and tear on council assets or potential costs of emergencies — a saving of $2.5m.

Council has also reduced spending on staff training, travel, maintenance and grants, and used reserves to fund one-off operational projects, thereby saving $500,000.

“These are not long-term solutions but does provide a short-term fix.

“It is important to note that while Council has reduced its rating income it still has sufficient income to meet its operating and capital expenditure for the current year. In line with Local Government Act Requirements Council is operating in a prudent manner and showing the necessary restraint expected by all local authorities.

“At the end of the day we are a vast district with a small ratepaying population. Every year we juggle our expenses the best way we can to keep rates affordable while still growing our district.

“Nobody ever wants any of their expenses to go up and while we are capping the average rates increase at 5%, it is an average, and there will be variations across the district and in different sectors.

“We have looked at alternative rating models in the past, even as recently as 2018, but these were rejected by the community. We will continue to look at options, but the reality is every decision made will have a balancing effect and it is impossible to keep everybody from every sector happy.

“As Council develops its 2021-31 Long-Term Plan in the coming months long term sustainability will be a major feature. Council cannot afford to live off its credit card and only pay interest, we will continue to investigate long-term solutions.

“For us the magic wand is to be able to increase our revenue and the best way to do that is through a population increase and the economic benefits that brings with it.

“The latest 2018 population Census data shows Wairoa’s population increased by 477 (8,367) when compared to the 2013 census (7,890).

“And what is even better news is the Wairoa district ‘Estimated Resident Population’ for 2019 is 8,680. This is an estimated increase of 790 compared to 2013, and 313 compared to 2018.

“We know people are moving here and that is having a positive flow on effect such as an increase in consents.

“Over the 2018/19 financial year a total of 151 consents were issued, up by 33 consents compared
to the previous financial year. The value of the consents is also increasing, and this trend has continued throughout the 2019/20 year.

“Like other businesses Council has also incurred additional costs and lost revenue as a result of COVID-19, and again it is about balancing that against keeping our rates affordable.

“We are trying to do everything we can to grow our district and making it the best it can be with as little impact on our ratepayers as possible.

“Over the last couple of years, the Council has attracted more than $15 million through the Provincial Growth Fund in additional Central Government funding.

“The physical work around many of these projects, is starting to become evident.

“Our latest boost was around $2.5 million for roading and construction projects which was part of the $15.24 million for Hawke’s Bay through the Government’s Worker Redeployment Package, announced in March.

“Wairoa work will see the replacement of the Patangata Bridge at Whakaki, realignment of the Nuhaka River Road at Nuhaka and repair of the Rangatahi Dropout at Mahia.

“Other physical works already underway include nearly $5 million for a town centre revitalisation project, $7 million towards the sealing of the Mahia East Coast Road, $2.2 million for bridge strengthening, and $400,000 for the creation of a regional digital hub in the Wairoa library.

“A business case is also being conducted to look at all the options for access into the Peninsula as well as the realignment of the Nuhaka/Opoutama Road.
“Just last year the Taxpayers’ Union 2019 ratepayers’ report placed the average Wairoa rates at $1880, the sixth lowest of the 66 Councils that were analysed.

“Of the 23 Rural Council’s the Wairoa District Council average rates are the fourth lowest.

“This is not a situation unique to Wairoa. We are not alone in this, all councils throughout New Zealand are affected.

“Locally councillors still have more work to do, including workshops, prior to the Council meeting on June 16 when it is expected the Annual Plan will be presented and the 2020/21 rates considered.”

29 May 2020

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