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Council shouldn’t revenue grab from windfall valuations

19 October 2014

Media Release

Council shouldn’t revenue grab from windfall valuations

Auckland Council should state clearly they will not try and capture revenue as a result of the latest valuations and needs reminding that the City’s skyrocketing property values doesn’t change the level or cost of Council’s services, says Auckland Chamber of Commerce head Michael Barnett.

“Rates pay for services delivered by Auckland Council. If the level and cost of services provided don’t change, then it is wrong for Council to impose rate increases just because the value of a property has increased….. All that does is treat rate payers as cash cows.”

A change to the link between property valuations and rates should be considered, said Mr Barnett.

He was responding to Council’s 2014 capital valuations of 525,000 Auckland properties released today. The average CV rise across the city since 2011 is 34%, putting the total value of the property stock throughout Auckland at some $474 billion.

The latest valuation will be used for rating purposes from July 1 next year.

However, Mr Barnett notes that the rating policy is due for review next month.

“One of the first things the review should consider is to remove the link between property values and rates.

“Rates should be assessed solely on the basis of the value of the services received. Just because the value of a property has increased should not dictate that rates will also rise.

Rates should only increase if and when service improvements are provided, he concluded.

ENDS

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