Bay of Plenty Regional Councillor Stuart Crosby. Photo / File
Bay of Plenty Regional Councillor Stuart Crosby. Photo / File
A Bay of Plenty Regional councillor has questioned the sustainability of big rates rises next year, coupled with seeking a bigger dividend from its investment arm.
The council met yesterday to sign off the draft of its 2021-31 plan for audit, before public consultation early in the new year.
The draft detailed general rates rises next year of 5.8 per cent and a 7.5 per cent jump in targeted rates.
The general rates increase would add about $16 to the average bill in 2021/22. The impact of the targeted rates would vary between areas of the district.
The draft proposed increasing rates around 3 per cent in each of the two following years.
Councillor Stuart Crosby said the regional council's operating budget would jump $19 million in one year.
Stuart Crosby is also president of Local Government New Zealand. Photo / File
The council has also asked its investment arm, Quayside Holdings - a 51 per cent shareholder in the high-performing Port of Tauranga - to increase the dividend it pays to the council by $7 million to $40 million next financial year, then by 3 per cent a year for the next nine years.
Quayside is considering the request, along with other suggestions from the council, and is expected to respond in the new year.
The council uses the dividend to offset rates bills: every $1 million from Quayside is the equivalent of 3 per cent in general rates.
Crosby said a $7m increase saved a 21 per cent rates impact.
"Do you believe that trajectory is sustainable from a funding perspective?" he asked council chief executive Fiona McTavish.
Bay of Plenty Regional Council chief executive Fiona McTavish. Photo / File
McTavish said she was confident in the sustainability of the budgets and that one of the key increases in the first two years was the council's $20m contribution to the Ōpōtiki Harbour project.
"Year one is very high then we track down in terms of those rates increases," she said.
Crosby said he had been around long enough to see supposed one-off "humps" repeat.
He said he supported the general content of a draft consultation document but, it needed to be more transparent about the finances of the council.
"We can talk about buses and surf-lifesaving all we want, but the big-ticket item for me is financial sustainability."
The draft plan for consultation puts the increase in costs down to more work created by Central Government, which is rolling out significant environmental reforms.
Other reasons include higher engagement requirements, costs relating to major capital projects and "environmental considerations that did not previously exist".
In the meeting, the council voted to add a targeted rate to the draft budget to raise $400,000 to fund charitable regional safety and rescue services.
The council gets regular money requests from the likes of Surf Lifesaving New Zealand and Coastguard New Zealand, but the fund was not limited to any specific organisations.
Surf lifesavers help keep people safe at beaches around the region. Photo / File
It also plans to ask for public feedback on subsidising bus fares - including making them free for school children - and introducing flat fares.
The council, which declared a climate change emergency last year, also planned to ask residents if they want more spending on climate change projects and to help households install things like solar panels, insulation and clean heating to make them more sustainable.
Other councillors raised concerns about the cumulative impact on ratepayers also facing rates increases from local councils.
The Tauranga City Council, for example, has foreshadowed increases totalling 45 per cent over the next three years.
Councillor Stacey Rose criticised the draft for being "too mild" from a "futuristic" standpoint, for a council that talked about transformational change.
Councillor Andrew von Dadelszen said it was nice to be aspirational but someone had to pay for it.
The draft is expected to come back to the council in February. It may be amended before being signed off for formal community consultation.
The regional council did not increase rates in 2020-21 in response to the impact of Covid-19.
