Bernard Orsman

Bernard Orsman is Super City reporter for the NZ Herald.

Brown eyes new rates package for households

Len Brown. Photo / Greg Bowker
Len Brown. Photo / Greg Bowker

Auckland Mayor Len Brown has a new package to help households facing hefty rates increases this year.

Mr Brown wants to abandon an earlier package holding rates increases to no more than $300 or 15 per cent and replace it with a package to hold increases to no more than 10 per cent.

Thousands of Aucklanders are in for a shock when the rating systems of the eight former councils are merged into a single system next year.

Suburbs such as Mt Eden, Mt Roskill, Remuera and the eastern suburbs are particularly hard hit by the proposed rating system and new property revaluations.

However, many West Auckland, Manurewa and Papakura residential ratepayers will see their rates fall by up to $500 or more in some cases.

The introduction of a single rating system is one of the biggest challenges facing Mr Brown in his first term.

Mr Brown and councillors, however, were not comfortable with the 15 per cent figure. Over the holiday, officerscame up with two new options.

The first is to spread any increases over three years, but this appears to have been discounted because it would still mean hefty increases for some and because of technical difficulties.

The second option, favoured by Mr Brown as the "fairest possible", is to take money off ratepayers getting big rates decreases and use it to limit hefty increases to 10 per cent. It would mean that no household would face an increase of more than 10 per cent over the next three years and none would get a decrease greater than 5.6 per cent.

It would also mean that ratepayers with rates increases or decreases within the rates-cap limits would not be affected by the policy.

However, in the fourth year about 25,000 households would be faced with increases of more than 10 per cent.

The option favoured by Mr Brown would cap decreases for businesses at zero and limit increases to 11.5 per cent in the first year, 15.7 per cent in year two and 18.2 per cent in year three.

Mr Brown's preferred option would require a law change, possibly by an order in council for the first two years, followed by legislation thereafter.

HOW IT WORKS

* For three years, households face rates increases no greater than 10 per cent or decreases greater than 5.6 per cent.
* In the fourth year, about 25,000 households face increases of more than 10 per cent.
* Businesses face increases no greater than 11.5 per cent in year one, 15.7 per cent in year two and 18.2 per cent in year three. There are no decreases.
* In the fourth year, about 7500 business still face increases of more than 10 per cent.
* The rating system needs Government approval.

- NZ Herald

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