Accommodation NZ Disappointed LGNZ Joining Case, Fears Wider Agenda

Accommodation NZ is extremely disappointed Local Government NZ has at the 11th hour applied for and been granted leave to join Auckland Council’s appeal over the legality of the Accommodation Providers Targeted Rate.

“This is extremely disappointing because this issue has been going on for five years but only now, just weeks out from the Supreme Court hearing, has Local Government NZ (LGNZ) decided to be a part of it,” says Troy Clarry.

“There is clearly more to this last-ditch effort to support Auckland Council’s bid to overturn the Court of Appeal’s ruling that threw out the targeted rate.

“We do not believe LGNZ will add anything new to the case, which the council has had five years to argue and spent well over $1 million of ratepayer money and countless hours of officials’ time – and climbing – while it’s being forced to make massive budget cuts.

“The facts of the case remain the same.

“As the Court of Appeal found in overturning the High Court ruling, the council did not take into account the accommodation sector receives less than 9% of the tourism income while paying 100% of the funding. There were very limited benefits for operators, and the court recognised that.

“Also, the council wrongly assumed accommodation providers could pass on that cost, which they genuinely are unable to do.

“This is more ratepayer money to support an appeal Aucklanders were already paying for, and they should be asking why their money is being spent in this way for no extra benefit.

“Accommodation NZ will continue to support its Auckland members while advocating for a fair funding model for tourism that is well thought-out and designed with the involvement of the industry.

“But while the focus has been on this case and how it affects accommodation ratepayers, there’s a much bigger concern this move by LGNZ indicates it has a bigger target – the application of targeted rates and the ability of councils across New Zealand to be able to use them to raise money for projects that do not have any benefit for the targeted ratepayers.

“We suspect this indicates other councils are waiting to implement the same targeted rates.

“And they may not be just an accommodation-specific. LGNZ’s involvement suggests they are advocating for the ability to use the targeted rate function to target any small group and charge what they like with no direct benefits needing to be demonstrated.”

The Court of Appeal will hear the case on July 20-21.

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