Tauranga City Council Long-Term Plan: Tauranga homeowners face 7 per cent rates rise

The median rates rise for Tauranga’s residential properties is 7 per cent. Photo / Mead Norton

Tauranga’s median rates rise for residential properties is 7 per cent after the governing commission signed off on the city council’s Long-Term Plan.

This will be an extra $4.39 per week for median residential ratepayers from July 1, 2024.

The confirmed median increase is lower than the 11.1 per cent signalled during Long-Term Plan deliberations in early March.

Council chief financial officer Paul Davidson said this was because of the impact of the 2023 property valuations approved by the Office of the Valuer General on March 27.

While the median rates rise is 7 per cent, properties in the upper residential property value band will have a 15.3 per cent increase or an extra $28 per week.

Those in the low residential bracket will have a 9.6 per cent increase in rates, an extra $3.68 a week.

The 2024-34 Long-Term Plan was adopted at a Tauranga City Council meeting on Monday.

Tauranga City Council commissioner Stephen Selwood. Photo / John Borren, SunLive

Commissioner Stephen Selwood said in the meeting there weren’t many other councils around the country that could emulate the 7 per cent residential rates rise.

The city’s average rates rise, which includes residential, commercial and industrial properties, is 15.9 per cent.

The lower residential rates increase “reflects the shift in rates away from the residential ratepayer to the commercial business sector,” Selwood said.

The commission had worked hard to get a fairer balance of the rates allocation, he said.

Commissioners introduced an industrial rating category this year, meaning industrial properties pay a larger share of rates than before. This reduced the residential rate by about 3 per cent.

Earlier in their term, the commission increased the commercial differential - a ratio for how much more commercial ratepayers pay compared to residential.

Before the commission’s appointment the 2020 commercial differential was 1.2, so commercial properties paid $1.20 in rates for every dollar residential properties paid. The commission increased this yearly and the differential for 2024 is 2.1.

For commercial ratepayers, the median increase is 10.7 per cent and for industrial ratepayers the median increase is 37.7 per cent.

The commercial and industrial rates increases don’t include the transport system plan’s Infrastructure Funding and Financing (IFF) Levy.

The median TSP IFF levy increase is 5.2 per cent for commercial properties and 6.1 per cent for industrial properties.

The average rates rise of 15.9 per cent and median residential rates increase of 7 per cent include the levy.

An IFF levy is a loan from Crown Infrastructure Partners, and will be paid back through a targeted rate over 30 years.

Commission chair Anne Tolley. Photo / Alisha Evans

Commission chair Anne Tolley said Tauranga was in “dire straits” prior to the commission’s appointment.

“There was no rating structure in place that relieved the burden on residents. In fact, the rates put all the burden on the residential ratepayer.

“The city was simply overwhelmed by the massive growth that had happened over a very short period of time.”

Tauranga’s rates increases will come into effect on July 1.

- LDR is local body journalism co-funded by RNZ and NZ On Air.