There is financial relief on the way for the Hastings commercial sector but, in exchange, some residential property owners may face a rates increase as part of changes to be phased in over the next eight years.
Commercial property owners in Hastings were paying 3.5 times more to the ratespool collected by the Hastings District Council compared to their urban residential counterparts in Hastings, Flaxmere and Havelock North.
The council decided this week to reduce the share of rates the commercial sector paid, after a lengthy review of the differences between commercial and residential rates.
The impact however, is that residential rates would increase, albeit over an eight year period to allow people time to adjust to the change.
Clive, Haumoana/Te Awanga, Whakatu as well as horticulture/lifestyle block owners would face the largest incremental increase over the phase-in period.
Hastings deputy mayor Cynthia Bowers headed the review and said it was not about increasing the amount of money collected via rates, but a redistribution of the rating responsibility between residential and commercial areas.
"We started with a clean sheet of paper and used the urban residential area in Hastings as a base, and then compared what ratepayers there got to what people got in towns like Clive, Haumoana/Te Awanga. We also compared what services residential areas got compared to what commercial ratepayers received.
"It came through that the commercial rate payers were getting 2.7 times the level of service than what residential ratepayers get," Cr Bowers said.
Commercial rates in the CBD were more because the area needed a "higher level of service" for roads and storm water for example, as well as financial contributions to business associations.
"At the moment commercial pays 3.5 times more than residential and we had said it should be 2.7."
The council met on Monday to consider the rating review and voted for the commercial differential rating to be 2.85, which was still lower than the current 3.5, Cr Bowers said.
It also agreed a targeted rate should apply to commercial businesses to pay for regular upgrades to the CBD, rather than taxing ratepayers across the district.
"We think 80 per cent of the costs should be paid directly by the ratepayers who are going to benefit, so that's the CBD landowners.
"There is also some public good in that work and so the other 20 per cent will be spread over the general rating base," Cr Bowers said.
