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7.9pc rates rise on the cards

Masterton ratepayers are likely to face a 7.9 per cent rates rise this year.

The latest figure was made available to the public yesterday in a council agenda that also recommended formal public consultation on the Draft Annual Plan.

Masterton District Council’s [MDC] finance manager David Paris, who wrote the report, said the first draft of budgets for 2023-24 period resulted in a rates rise of 14.2 per cent.

“Staff and elected members have scrutinised the work programme and budgets with a view to minimising the rates impact on our community, given the difficult economic conditions the community are facing,” Paris said.

“Cost reductions that do not significantly impact levels of service have been identified.

“Increases in some user charges above the rate of inflation are proposed in some areas to reduce the rates.”

At 7.9 per cent, the proposed average rates rise is higher than MDC’s Long-Term Plan [LTP] projection of 6.5 per cent, but is lower than the 10.4 per cent limit in the council’s financial strategy.

Neighbouring Carterton District Council has estimated a rates rise of between 4 per cent and 7.2 per cent on average this year.

Key drivers for MDC’s rates increase reflect the current economic environment and are primarily outside of council’s control, Paris said.

These factors include: higher-than-forecast inflation, higher interest rates on borrowing, insurance costs, and increased renewal and depreciation costs.

Paris said the council’s insurance costs are expected to increase 15 per cent from a current cost of $1.02 million.

As part of the Annual Plan consultation, residents and ratepayers will be asked their thoughts on cost-saving measures.

The council proposes to increase user-pays fees and charges in order to generate an estimated $65k in additional revenue.

Building consent fees, building warrant of fitness fees, environmental health fees and charges, cemetery fees, LIM fees, and resource consent fees are proposed to rise 10 per cent.

Senior housing rents are also proposed to be raised by 6.5 per cent, which is an increase of $6.50 per week.

This rise brings the average council senior housing rental to $111 per week and the increase is set to generate an additional $14,000 in revenue.

MDC also proposes to introduce a new e-waste fee to generate an extra $10k, slash its community grants funding by $88k, and seek more external funding for council projects and initiatives to the tune of $22k.

Total council staff numbers are not increasing, and savings have been built into budgets by allowing for a level of staff vacancies carried during the year, Paris said.

The council is set to discuss the consultation approach on Wednesday.

Under the Local Government Act, the council is required to consult on an annual plan if there are significant or material differences compared to what was planned for that year in the LTP.

“The proposed changes to mitigate the rates impact may not be assessed as significant or material in usual circumstances,” Paris said. “However, we know that these are not usual circumstances.

“We are delivering in challenging times and the proposed changes will have some implications for some sectors of our community.

“User charges, by their nature, impact directly on the users of those services, rather than spreading costs across the ratepayer base.

“For these reasons, we believe the most open and transparent approach is to consult on the proposed changes.

“We want to know what our community think.”

Variances from the LTP for the coming financial year include: the civic centre scope being revisited, and the replacement of the all-weather athletics track at Colin Pugh Sportsbowl being deferred to 2024/25 due to cost escalations. –NZLDR

    Public Interest Journalism funded through NZ On Air

Emily Ireland
Emily Ireland
Emily Ireland is Wairarapa’s Local Democracy Reporter, a Public Interest Journalism role funded through NZ On Air. Emily has worked at the Wairarapa Times-Age for seven years and has a keen interest in council decision-making and transparency.

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