Cutting next year's rates in a post-Covid-19 reset would mean local job losses, according to Far North District Mayor John Carter.
"That would not improve our economy or our recovery," he said.
His comments came ahead of the council's meeting today to formally debate rates for the financial year starting on July 1.
"The reality is that we are a significant service provider that directly and indirectly employs hundreds of Far North residents.
"Tightening our belt by reducing rates would inevitably mean contractors and our own staff would lose their jobs."
FNDC had been planning a 3.94 per cent rates increase for the coming year pre-Covid-19.
Carter is not saying what the council plans to do about any change to this at its 2020/2021 Annual Plan deliberations meeting - ahead of formally adopting the plan on June 30.
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"At this stage, it would be inappropriate for me to discuss the details of the options being considered ahead of the council's June 5 deliberations or the final decision on rates due on June 30."
Councillors have had two workshops to consider rating options for the coming year.
"Far North District Council is aware that many ratepayers are facing economic hardship due to the Covid-19 coronavirus pandemic and the ongoing drought," Carter said
FNDC would not need to consult on any changes to the 2020/2021 rates.
"The council has not made any changes that will require additional consultation," Carter said.
He would not be drawn on how much income FNDC expected to lose in 2020/2021 due to Covid-19 impacts.
"It is worth noting (however) that Far North District Council does not have significant alternative revenue streams, such as a port, income from parking charges, or an investment portfolio.
Other councils that do receive income from sources like these may be more significantly impacted by a pandemic-related economic downturn," Carter said.
FNDC's initially-planned rates increase for 2020/2021 is slightly less than it said would be introduced for the year during 10-year long term planning covering this period. This longer-term planning indicated a 4 per cent increase.
It is the only Northland council to initially set its coming year's rates below what it said would happen in its 2018-2028 Long Term Plan.
Carter said today's meeting would also include consideration of whether FNDC continued sourcing funding to cover asset depreciation from rates.
Public consultation about the 2020/201 annual plan had not been impacted by Covid-19.
Consultation started before the level 4 lockdown and finished before level 3 restrictions began.
FNDC had been exploring ways to reduce costs to minimise rate increases.
It had worked through options alongside Local Government New Zealand and the Government.