Covid 19 coronavirus: Council signs off $900K relief package

Businesses, community groups and sports teams are among those who stand to benefit from a pandemic relief package worth up to $900,000 agreed by Tauranga City Council. In response to a request for relief from the Tauranga Chamber of Commerce, the council has agreed to wipe or heavily discount rents and user fees and charges in some situations of hardship caused by Covid-19.

The council stopped short, however, of rates relief measures. This was due to the impact they would have on the council's balance sheet. A proposal to remit some water rates late penalty payments was also nixed on legal advice.

The council had previously cut its 2020/21 draft rate increase - currently out for consultation - from 12.7 per cent to 7.6 per cent, and council staff now say they expect to need to change and consult on the plan again to reflect the pandemic.

Among the relief measures agreed in a virtual meeting yesterday afternoon was provision for up to $100,000 in user fees and charges relief up to the end of September 2020.

Requests would be considered on a case-by-case basis and judged on hardship. Council chief executive Marty Grenfell would have the final say.

Council corporate services general manager Paul Davidson told the Bay of Plenty Times the fund had been designed to be flexible.

While mainly aimed at small and medium-sized businesses, he said any ratepayer, group, or business could apply for relief from fees or charges and be assessed based on hardship.

The council collects revenue from fees and charges from a huge range of services - from use of its cemeteries and event hirage of its facilities to building consents and liquor licensing.

Davidson said the council would consider whether other support avenues - for example, Government funding - were available or more appropriate in its decisions.

Davidson acknowledged the fund may run out before September. If that happened the council could decide whether or not to top it up.

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Mayor Tenby Powell told the Bay of Plenty Times he expected the fund to go quickly.

He said the goal of the relief measures was to augment the support funding central Government had put in place, and do what the council could to help as many small- and medium-sized businesses as possible survive.

The council also agreed to discount rent payments by 50 per cent for some groups that have commercial or residential lease or grazing agreements for council land until June 30.

Those with a license to occupy council land - generally cafes or shops that rent space on public footpaths for signs or seating - could get a discount of up to 100 per cent.

Elected members asked for that increased discount to reflect the fact many license holders were not able to open their doors at all under alert levels 3 and 4.

• Covid19.govt.nz: The Government's official Covid-19 advisory website

To be eligible for the rent discounts, organisations would have to meet the Government's Covid-19 support package criteria. Any longer-term adjustments or rent freezes would be considered on a case-by-case basis.

The council also considered a 50 per cent reduction for tenants of airport land, but elected to pause that decision to better understand who would be eligible and what support was needed.

Councillor John Robson said it would not be a good look for the council to be offering discounts to a big business that could support itself while smaller enterprises struggled.

Community and sports groups, which have been hit by restrictions on gatherings, would also receive some help.

Tauranga Moana Waitangi Day Festival at the Tauranga Historic Village this year. Photo / File

Community organisations that lease space in the Historic Village or that lease land directly from the council will have their rent waived for the last three months of this financial year.

Commercial tenants in the Historic Village would receive a 50 per cent discount over the same period.

The council would consider a further 3 to 6 months of rent relief for those tenants in its 2021 Annual Plan process.

The waived and discounted fees represent forgone revenue for the council. This will add debt that will have to be paid off in time. Only the relief proposed for sporting groups - amounting to $135,000 - would impact on a rates-funded activity.

The relief package was designed to avoid significantly impacting the council's revenue, which was already significantly hit by Covid-19.

Tauranga Chamber of Commerce chief executive Matt Cowley. Photo / File

Tauranga Chamber of Commerce chief executive Matt Cowley said he accepted the council's recommendations and "we appreciate the elected members support for local small businesses, especially given the council's own financial issues".

While the chamber had asked for the council to remove or defer some specific fees, he said he supported the flexible approach of the $100,000 hardship fund "as a number of businesses will fall into that hardship category".

He also backed the council's decision to extend the fund to September, rather than stopping it at the end of the financial year.

The extension would give the council more flexibility and also ensure some businesses that have to pay fees near the beginning of the financial year, such as hairdressers, would be eligible.