How ARC ignored rates advice

By Wayne Thompson

By WAYNE THOMPSON

Auckland Regional Council was warned by the region's seven city and district councils against its controversial rates system.

The ARC, given power for the first time to directly rate property, ignored free advice when it chose a rating system based on a property's capital value that makes no differential between business and residential properties.

In early May, senior council officers - long versed in how to avoid creating firestorms of ratepayer protest - and experienced members of councils and community boards challenged the fairness of the system proposed by the "new chum" in the rating game.

In submissions to the ARC, various councils called on it to:

* change the due dates between rates for local councils and the ARC so ratepayers were not hit all at once

* rethink the basis of how the rates were calculated

* rethink charging people for regional services which they may not be able to get in their area.

North Shore Mayor George Wood yesterday said the ARC's discarding of his council's submissions resulted in 300 angry people stumping up to his council's monthly meeting on Wednesday night to get its backing in a bid to force the ARC into rethinking its rates.

"I have never seen so many people turning up at our council chamber," said Mr Wood.

The bid to increase the regional rates take by 34 per cent should have been done "by evolution rather than revolution", said Mr Wood.

"If it had been done incrementally there would not be the pressure we see now."

North Shore City Council and Rodney, Papakura and Waitakere councils called on the ARC in May to reconsider use of capital (improved) value in favour of land value (unimproved), which they all use as a basis for rating.

Papakura said capital value was less fair to residents because it ignored their ability to pay.

North Shore said capital value gave more extreme and exaggerated differences in rates between properties than did land value.

It said a uniform annual general charge set for each property would be closer to benefits received than a levy on property value, which hurt the elderly and those on fixed incomes.

Auckland City came out strongly against the ARC for not using differential rating as the region's other councils do.

The city said this would shift the rates burden from business ratepayers to residential and rural ratepayers. It warned the ARC a sudden jump from a differential system, combined with a substantial rate rise, would result in "extreme impacts".

North Shore, Papakura and Rodney were also against a system which rated all properties at the same rate in the dollar.

North Shore suggested a differential where businesses paid five times more than homes would provide the higher costs of services to businesses.

Councils with residents outside the metropolitan areas said having one transport rate applying across the region meant areas of low service were disadvantaged compared to those with a high level of service.

Regional councillors eventually voted seven to five for the ARC rating system.

Rates protests

* Meeting of protest groups at St Columba Church in Surrey Cres, Grey Lynn, 1pm tomorrow.

* Castor Bay and Campbells Bay Ratepayers Associations hold a joint public meeting at the Milford Senior Citizens Hall, 11am Sunday.

* Orewa residents' rates protest at the Orewa Community Centre, 2pm August 2.

* Public protest march up Queen St, Auckland City, August 6.

Tell us what you think about the rates increases:
* Email the Herald News Desk

Herald Feature: Rates shock

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