Most Western Bay of Plenty residents finally get rates relief after years of helping build the district council into a "strong financial position".
The rates bill for 61 per cent of Western Bay ratepayers will decrease after a unanimous decision today to increase rates 1.98 per cent in the council's 2020/21 Annual Plan.
Western Bay mayor Garry Webber said the Annual Plan took into consideration the impact of Covid-19 on the economy and household incomes and the ability for the council to deliver public services post-pandemic.
Today's decision comes despite previous criticism from first-term councillor Christina Humphreys who campaigned on reducing rates.
"Some would prefer not to put the rates up. We all would prefer that, but to make sure this business is financially responsible and set up for the next year, that's the best that could be done," Webber told the Bay of Plenty Times.
"We've gone through the GFC [Global Financial Crisis], PSA - and the significant impact that had on property values - and now Covid, and come out of those three big shocks in pretty good shape."
The council's debt is $100 million. Ten years ago it was $180m.
Webber referred to international credit rating agency Standard & Poor's (S&P) when saying the council was "one of the few councils in Australia and New Zealand that has reduced debt over the past 10 years".
In September, S&P lifted the council from AA- rating to AA, revising its outlook from stable to positive.
The upgrade was in recognition of the council's significant reduction in debt, good financial performance and positive fiscal outlook, it said at the time. S&P also said that it expected the council's financial position to continue to improve as it benefited from strong revenue growth.
Webber said the council had "managed" its debt level down, and rates were a large part of that.
"When Western Bay went through the GFC, being a fast-growth council, we went through hard times but we had the courage of mayors Ross Paterson and Graeme Weld before me to go to ratepayers to explain why it was necessary to do what we had to do."
In 2012, the council sought to dig itself out of a funding crisis caused by the GFC by upping rates by an average of 4.7 per cent. Since then, rates have increased each year with rises between 4 and 7 per cent, resulting in some residents experiencing hikes of as much as 10 and 12 per cent.
"After all of those hard years, we've now got this place into a pretty strong financial position."
Webber said some "hard decisions" had been made but today's vote was reflective a good result.
On May 30, Humphreys was the sole councillor to oppose the proposed 1.98 rates rise.
Humphreys could not be reached this afternoon but previously said a zero rates rise was more appropriate to "give the public some respite on their fixed costs in these difficult times".
In the coming year (July 1, 2020 to June 30, 2021) the council will collect $66.50m in total rates. This comprises district rates ($40.86m); community board rates ($0.42m); water treatment and supply ($6.41m); wastewater ($11.45m); stormwater ($4.73m) and other targeted rates ($2.63m).
Items in the 2020/21 budget that contribute to the 1.98 per cent increase are: $1.03m to continue the seal extension programme across the district, $1.5m for wastewater treatment plant improvements, $900,000 support for community groups including Tourism Bay of Plenty, Katch Katikati, and Te Puke Economic Development Group, and $200,000 for Waihi Beach's Island View Reserve playground and development.