Council votes to increase rates

By DENISE DION

March 13, 2013, 11:17 a.m.

BVSC

Bega Valley Shire Council will apply to the Independent Pricing And Regulatory Tribunal (IPART) to increase rates above rate pegging following an extra-ordinary council meeting on Thursday, March 7.

The decision was made on five votes to four with Councillors Bill Taylor, Tony Allen, Michael Britten, Ann Mawhinney and Liz Seckold voting for the increase and Councillors Russell Fitzpatrick, Keith Hughes, Sharon Tapscott and Kirsty McBain voting against.

The application covers rate increases for the next three years and if successful will see general rates rise by about 13.5 per cent between now and 2016, assuming rate pegging to be 3 per cent in 2014/15 and 2015/16.

The decision at the council meeting was not without some discussion. In speaking for the increase, Councillor Michael Britten referred to the asset management backlog of $70 million which could drop to $40 million, he said, over the next 10 years if the increase goes ahead.

Council currently spends about $6 million on maintaining its assets, such as roads and bridges but finance manager Lucas Scarpin told the News Weekly that council needed to spend double that every year for the next 20 years just to keep the assets where they were.

In relation to people’s ability to pay, Cr Britten said: “A lot of people may not want the increase. It is not possible to take into account the circumstances of each person in the shire.”

Councillor Russell Fitzpatrick spoke against the motion citing major concerns over the level of water and sewerage charges. “Whether we like it or not it is considered one bill and since 2005 we have had 19 special variations and have raised $19.4 million,” Cr Fitzpatrick said.

“As late as yesterday we were told we could have substantial changes to water and sewerage charges. I can’t support this until our whole house is in order,” he said.

Councillor Tony Allen spoke in favour of the increase and said: “The essence of what we are doing today is finding a few extra dollars for roads. The other big issue is the halls. We have 17 or 19 halls today and they are the lifeblood of the towns. They are vital infrastructure and we can’t allow them to go into a bad state.”

Cr Allen admitted though he had been “shocked by what I heard yesterday on water and sewerage”. He said he supported the increase but had reservations.

Councillor Sharon Tapscott also said there was a need to sort out water and sewerage charges first and said she didn’t think there was the capacity to pay in the community, or the support for the increases.

“I don’t think ratepayers have the capacity to extend themselves any further,” Cr Tapscott said.

But the Mayor, Bill Taylor disagreed and said that he had lived in the area most of his life and in his role as mayor no one had stopped him to talk about it. “It’s not an issue out there. I think we have to take into account the relatively little reaction.”

Cr Taylor said that while the reaction was based on inability to pay and he understood that, council had a moral obligation to provide services.

“This is about the assets into the next generation. The issue of water and sewerage, it’s only part way through the workshops and it would be wrong to assume it will go up. Let’s deal with the special rate variation in isolation and give credence to public opinion,” Cr Taylor said.

The application to IPART covers:

• New 2 per cent one-off permanent increase above the 3.4 per cent rate peg in 2014, for renewal of collector roads.

This will mean a 5.4 per cent increase in 2013/14 rates.

• Retained 2.5 per cent one-off permanent increase above rate pegging in 2015 to retain the expiring recreation and access approval for recreational facilities.

This will have no effect on general rates as ratepayers currently pay this and as an expiring levy it will be continued.

• New 2 per cent one-off permanent increase above rate pegging in 2016 for infrastructure renewal for public domain areas and buildings.

The net effect of these increases over the three-year period and due to the small compounding effect will be 14.36 per cent for residential and farmland and 13.5 per cent for business, according to IPART’s own calculations, Mr Scarpin said.

The calculations assume that CPI will increase by 3 per cent in 2014/15 and 20115/16. The proposed increase applies only to the general rate element and not to water or sewerage charges.

The application has now gone to IPART, where it will be reviewed. A final decision on rates and charges will be made at the June council meeting.