Council confirms its rating intentions

Auckland City councillors have confirmed their intention to limit the total rates increase to the rate of inflation, currently estimated to be 2.5%, and will now consult the public on this preferred rating policy.

Councillors confirmed their favoured rating policy option for the next financial year at today’s combined meeting of all eight council committees. The Combined Committees are setting budget policy and other priorities for the financial year from 1 July 2003 to 30 June 2004.

The rating policy will be included in the council’s draft annual plan – and will be subject to a major public consultation campaign in April and May.

The chairperson of the council’s Combined Committees meeting, Deputy Mayor David Hay, says the fact the council is limiting the increase to the rate of inflation is testament to the council’s prudent financial management of the city.

“It’s a sensible decision. It preserves the council’s revenue base. It also honours the ACRN election pledge. We are now set to repeat last year’s achievement of the lowest rates increase in the region and one of the lowest in the country.”

The rating policy includes the proposal to increase the targeted rate for waste collection from $47 to $110, to provide the 2.5 per cent of extra revenue required to preserve the council’s current income in real terms.

Mr Hay says the increased targeted rate for waste collection would accurately reflect the cost to the council of providing the waste collection service.

The Combined Committees meeting also agreed its preferred rating policy option will include replacing part of the general rate with a uniform annual general charge of $150.

The Deputy Mayor says introducing a uniform annual general charge (UAGC) will smooth the impact on residential properties of the recent revaluation of city properties.

“Last year’s city-wide property revaluation has resulted in an increased rates burden on most residential ratepayers. The council has explored a number of options to limit this burden, including the uniform annual general charge.”

The UAGC would also result in every ratepayer contributing the same amount to council provided services that are accessible to and for the benefit of everyone, such as parks and libraries. The current annual value-based rating system does not do this.

“Regardless of whether your property is worth $100,000 or $1,000,000, every ratepayer benefits from council provided services like the art gallery, street lighting, footpaths, parks and libraries.

“We believe replacing part of the general rate with a $150 charge to recognise the benefit to each ratepayer of these and many other services is an improvement to the council’s rating policy.”

The UAGC would also be the lowest charged by any of the major city councils in the region.

Both the targeted rate for waste collection and the UAGC would apply to each separately used or inhabited part of a rating unit.

The Deputy Mayor says the Combined Committees meeting also agreed the rating policy should include an alteration to the business differential, the amount of rates paid by business compared to residential ratepayers, to further limit the impact of the revaluation on residential ratepayers.

The combined effect of all the rating policy decisions of today’s Combined Committees meeting means the average rates increase for residential properties will be 5.4 per cent.

“The impact on individual residential ratepayers will vary – some will be lower than this average increase and others will be higher. The meeting has approved a rating policy that results in the best outcome for all residential ratepayers.”

Non-residential ratepayers will have significantly lower rates increases, within the overall 2.5 per cent increase, as their property valuations did not increase by anywhere near as much as those of residential ratepayers

Mr Hay says today’s Combined Committees’ decisions are expected to be approved at the formal council meeting tomorrow morning.

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