Tauranga City Council elected members during yesterday's meeting. Photo/Samantha Motion
A fist was banged on a table and voices were raised in passionate speeches as Tauranga City Council thrashed out a 12.6 per cent draft rates rise yesterday.
The rise, if adopted in the annual plan after public consultation, would work out to a median 8 per cent increase for homeowners, or about $4 extra a week.
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The 6-5 vote came after three hours of presentations about the pressure the council's finances were under from growth, with the need to make massive infrastructure investments without breaching the debt to revenue ratio, triggering refinancing.
There were two hours of, at times, intense debate.
Deputy mayor Larry Baldock led the charge for the rates rise - not for the first time in recent years. At one point he banged his fist on the table.
"If we don't make the right decision today, we will see sewage spilling into the harbour, people won't turn on the tap and get water all the time, and flooding will get worse.
"We have to all face the pain of it and get on with building a great city."
Mayor Tenby Powell, who also backed the rise, slammed the notion that Tauranga must stop growth, calling it "Trump-esque" and "isolationist".
"This is Tauranga, not a fortified, walled city of ancient Europe... It's 2020, not 1620."
"We are going to grow, people are going to continue to come. It's time to stop being rubbery-lipped about growth and drop the 'I don't want my sleeping little village to change' tantrum."
Much of what needed to be paid for was historical, he said.
"Increasingly I feel less like the mayor and more like the janitor constantly sweeping up yesterday's mess due to visionless leadership and an abject lack of courage."
Tauranga was an "amenity desert", he said, with outdated pools and halls.
"A new generation of children who without fit for purpose amenities, may end up on the street and in gangs."
There was strong opposition from some councillors, however, to such a high rates rise.
Much of that centred on figures drafted by Councillor Kelvin Clout and council staff showing Tauranga already had higher average (mean) residential rates than Wellington, Christchurch, Hamilton and Dunedin.
Auckland, as a unitary council, calculated its rates in a way that made it more difficult to compare but Clout's rough estimates showed Tauranga was close.
The analysis also showed residential ratepayers in Tauranga carried a greater chunk of the rates burden than they did in the other cities, where the commercial sector paid more.
Clout went on to vote for the 12.6 per cent rise, despite having committed to a lower rates cap during his mayoral campaign.
"If this was business as usual then [the cap] is what I would be proposing. But this is not business as usual."
He pointed to "skyrocketing" capital costs and the need for "massive" infrastructure and resilience investments alongside social infrastructure.
"I am not afraid of going out on a limb for the sake of future generations of the city."
Councillor Steve Morris, who voted against the rise and wanted the decision delayed, said the council was perpetuating the "myth" that Tauranga ratepayers were not doing their bit.
"Residential ratepayers are more than stepping up. They have been funding this city for years. We are running out of runway to hit them with any more."
He said statements by Baldock that people on low incomes who owned expensive homes, who would be hit hardest by a big rise, may have to downsize had "put the fear of God into people".
"We shouldn't be talking like that."
People would be left with a stark choice, he said: "What would I do without?"
"The council is betraying the trust put in it by the community just four months ago."
Along with councillors John Robson and Bill Grainger, Morris argued the council should wait for further information on other options before making a decision next week.
Rate rise supporters talked about the need to show Tauranga's regional and central government partners that it was serious about getting the city back on track.
Robson, however, said he saw no reason to "over-egg the commitment pudding to show central Government we are willing to work with them".
He called for the Government to sign a Memorandum of Understanding with the council over funding.
"Talk is good, rhetoric is entertaining, but at the end of the day, show me the money."
He also argued the business community had not been paying its fair share of rates "for years". Now its talent struggled to afford a home in Tauranga and wasted hours stuck in traffic.
The council also voted for commercial property owners to pay a bigger chunk of the city's rates bill, increasing the commercial differential from the planned 1:2 to 1:3.
Two business leaders, asked earlier in the meeting about the sector's appetite to pay more, said it may be accepted if the council could show what businesses would be getting for their extra money.
Priority One chief executive Nigel Tutt said: "It all comes down to what you get for that money. That's where we failed last time. We couldn't get across what they got for that."
"It's going to be really crucial to bring businesses along with you."
Tauranga Chamber of Commerce chief executive Matt Cowley said the council needed a solid plan to give the business sector confidence.
"A lot of these business owners are also [residential] ratepayers too, so they are also paying twice."
Councillor Jako Abrie argued for a higher rate increase of 15.1 per cent to allow the council to offset more debt.
He predicted it was a doomed move, and he was right. Only Councillor Tina Salisbury supported it.
Yesterday's decision would allow for a capital work programme of $244 million, meaning all but about $4m of project plans already on the books for 2020-21 could stay there.
It would also reduce the fixed portion of the rates - the uniform annual general charge - to 10 per cent from 20 per cent to lessen the impact of the rise on those with the lowest valued properties.
Public consultation for the draft annual plan is expected to start on March 25.
Here's what a 12.6 per cent rates rise would work out to each week for these property value benchmarks, ranging from the lowest to highest valued properties.
Residential
$350,000: $0
$525,000: $2
$650,000: $4
$740,000: $5
$810,000: $6
$2,400,000: $26
Commercial
$550,000: $9
$1.070,000: $20
$2,010,000: $41
$2,620,000: $55
$25,626,000: $572.
Rates rise breakdown
Business as usual general rate: 3.9 per cent
Waters: 2.1 per cent
Growth and transport planning: 1.5 per cent
Debt management: 5 per cent
Other: 0.1 per cent
Commercial differential: 1:3
Uniform Annual General Charge: 10 per cent.
Capital programme: $244m.
How they voted
For: Deputy mayor Larry Baldock (mover), mayor Tenby Powell, councillors Kelvin Clout, Jako Abrie, Tina Salisbury, Heidi Hughes.
Against: Councillors Steve Morris, Dawn Kiddie, Andrew Hollis, Bill Grainger, John Robson.
Motorists should avoid SH2 East between Stanley Rd and Fraser Rd.