Wellington City Council has discovered an error that caused it to undercharge the household and commercial sludge levy in the quarterly rates invoices sent on 1 August 2025 and 1 November 2025.

Households have been undercharged between $3 and $100 each, with an average undercharge of $40 per levy payer.

Commercial levy payers have been undercharged between $500 and $5,000, an average of $1,200 per levy payer.

The Council is the only entity that owes more than $5,000. It has the highest undercharge of $63,186 for its properties.

The total undercharged amount is $3.436 million, which the Council is legally required to collect and pass on to the financial entity set up to fund Wellington City Council's (WCC) new Sludge Minimisation Facility, Sludge Finance LP.

As such, the Council cannot selectively waive or absorb levy charges.

Instead, levy payers will see the undercharge added to the two remaining rates invoices to be sent on 1 February and 1 May 2026. Most of the adjustment (3 quarters of the adjustment) will be included in the February invoice, with the remainder applied in the final instalment on 1 May. The correction does not mean levy payers will pay more than they should. It simply brings everyone to the correct annual levy that applies to their property.

Andrea Reeves, the Council’s Chief Strategy and Finance Officer, says: “We want to sincerely apologise for this error.

“It was discovered during a quarterly reporting review, and Council took immediate action to review how the error occurred.

“To prevent this happening again, stronger internal controls have been put in place, including additional review steps.

“We want to reassure Wellingtonians that their February rates notice will include personalised information about the undercharge on their account, and no penalties or interest will be applied for the undercharged sludge levy.”

Andrea Reeves will be available to answer any questions from media between 3pm-3.30pm today (17 December) at level 16, 113 The Terrace.

About the error

The error happened during the upload of the levy into the billing system. Some amounts were entered as GST-inclusive instead of GST-exclusive, and an incorrect fixed charge was used.

The levy order allowing the Council to collect the levy is correct and the levy calculation was set correctly.

The levy is unrelated to the additional capital funding approved to complete construction of the sludge minimisation facility.

About the sludge levy

The levy repays the Council’s loan to construct the sludge minimisation facility.

The Council secured funding for the construction of Te Whare Wai Para Nuku, the sludge minimisation facility by utilising the Infrastructure Funding and Financing Act 2020. The finance was raised through a Special Purpose Vehicle called Sludge Finance LP, which is wholly owned by National Infrastructure Funding and Financing.

The funds raised by the SPV are to be repaid via a ratepayer levy authorised under the Wellington Sludge Minimisation Facility Levy Order 2023 (the levy order). The levy is invoiced alongside rates and is included as a separate portion in each quarter’s rates notice.

The levy comprises a flat fee and a pro rata levy based on property value and the category of land. The Council collects the levy, then pays it to Sludge Finance LP, to repay the debt raised for the facility.

The tables show what was charged compared with what should have been charged.

Connected property

Unconnected property

Commercial property

Average undercharge per household property valuation band

Average undercharge for the levy (both Commercial and Household) per suburb

© Scoop Media