Tauranga City’s Mayor and Councillors have asked staff for options they can consider to reduce rates increases as part of the draft 2026/2027 Annual Plan. 

A report received at yesterday’s Council meeting set out options for reducing a preliminary estimated average rates increase of 13% for the next financial year, which is higher than the 10.4% increase forecast in the 2024-34 Long-term Plan. The Council asked for additional options which would allow the potential increase to be reduced to 7.5% and 4%. 

Mayor Mahé Drysdale says Elected Members agreed that the report is a “good starting point” and are determined to ensure that any increase in 2026/27 rates charges is affordable and service levels are aligned to community expectations. 

“To that end, Elected Members and staff will be looking at the cost reduction options we can achieve, to be put to the people of Tauranga in next year’s draft Annual Plan consultation process,” Mahé says. 

The Mayor and Councillors will also be considering what consultation processes the Council should undertake, with a view to establishing the relative importance people and organisations place on rates costs, maintaining current levels of services and investing in infrastructure and community facilities. 

“Key drivers of the current working draft budget are increased depreciation and debt servicing costs, additional operating expenses related to new assets, and planned water service surpluses to achieve the level of financial sustainability required by the Government’s Local Water Done Well legislation,” Mahé explains. 

“Options for reducing rates include lowering our planned capital expenditure; adjusting our water service revenue expectations; realising the value of some Council assets; and increasing user fees and charges. 

"We also want to explore the community’s willingness to consider service reductions. That will be an important part of our draft Annual Plan consultation and reflects the reality of our situation if we are to achieve the rates capping target set by central Government.” 

Mahé adds that the Council has taken on board community feedback about rates affordability, as well as the future rates cap signalled by the Government, and will be doing its best to move towards those expectations.

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