Larger rate rises ahead

GISBORNE City residents face an average rates increase of just under 7 percent, while forestry interests will incur a 29 percent rise, figures in the District Council’s long-term plan consultation document show.

Commercial ratepayers face an 8 percent increase.

The theme of the council’s plan consultation round is “thrive to five” and includes a 5 percent rates increase. But a list of proposed rates changes in the document shows that the average residential urban increase is actually 6.9 percent.

The document says the 6.9 percent average for most properties in the city, fringe and residential lifestyle blocks is mainly due to increased fixed rates for water infrastructure, parks and reserves, dog and noise control, and the uniform annual general charge.

Increases to valuations at Wainui and connection to services of lifestyle properties in Sponge Bay and Cameron Road are drivers for increases over 10 percent there.

For a property with a $257,000 valuation, the actual rates would rise from $2665 last year to $2849, an average increase of $3.50 a week.

The main driver for the 29 percent average increase for exotic forestry properties is the increase to the roading differential.

The weighting of the rate for local roads is proposed to increase from 5 to 7.5 times more than a standard residential property pays.

For a property with a $1.3 million valuation, the actual rates would rise from $7712 in 2017/18 to $9948 in 2018/19. The council says that is a rate increase of $43 a week.

Residential lifestyle properties face an average increase of 4.9 percent.

For a property with a 2017 valuation of $490,000, that would produce an increase from $2241 to $2350.

Residential rural properties would rise by an average 3.4 percent, which means from $1190 to $1231, or 75 cents a week.

The council says while the average increase for most properties in townships and small communities is 3.4 percent, increases are higher in places like Whatatutu for new connections to the water supply.

Policy review in first yearThe council says the 8 percent average increase for most commercial properties is mainly due to higher valuations, increases in the UAGC, water connection and parks and reserves rates. On a $252,000 commercial property, the rates would rise from $2124 to $2294, or $3.25 a week.

Horticultural and pastoral properties would incur an average 3.8 percent increase or a rise on a $2.5 million property from $6391 to $6633, $4.70 a week.

The council says the increases are mainly due to reductions in pest and plant rates and increases for parks and reserves.

A number of rateable properties changed to the horticultural/pastoral category, which has a higher rating differential of 1.5.

District Council chief executive Nedine Thatcher Swann said 5 percent is the total average increase in rates the council needs to fund essential services and activities. The incidences of rates will differ depending on the services received and property valuations.

Referring to the forestry weighting increase, she said the council adopted its revenue and financing policy at its January meeting, with a differential rate weighting move from 5.0 to 7.5.

The weighting on local roads applies to forestry.

“At status quo, a 5.0 weighting for forestry equates to $1 million of rates income to apply to local roads, a 7.5 weighting provides an additional $430,000, with the overall rate income from forestry now being proposed at $1.48 million.”

“There will be a wholesale review of the revenue and financing policy, commencing in year one of the 2018-2028 long-term plan, which will look into the best way to recoup costs from heavy vehicles along with other principles such as user-pays.”

The examples given for the proposed rates changes are for a typical residential property rated for standard services.