Far North District Council is to slash its planned annual rates increase in the wake of Covid-19.

The council yesterday decided on a 2.23 per cent rates increase, 43 per cent less than the 3.94 per cent increase it had been planning for the 2020/21 financial year starting on July 1.

Mayor John Carter said it was the first time the council had done a major rates reset like this.

"I've never seen the situation we're now facing in more than 50 years in local government," Carter said.

Advertisement

The 2.23 per cent rates rise will be simply to keep in line with Local Government Cost Index (LGCI) indexed inflation. It was decided at the council's online meeting yesterday and will be formally adopted on June 30.

Carter recently warned job losses for contractors and staff would result from cutting rates for the coming year due to Covid-19 impacts.

But he said the council had been able to achieve its rates reset without that.

It had trimmed council operational costs - the amount of money collected from rates to cover the ongoing maintenance/replacement or deprecation of its assets would be cut by 24 per cent for the 2020/21 financial year. That reduction would then be added on to rates collection over the following five years.

Also, some council costs incurred in the coming financial year would be spread forward over the next two or three years in a similar way.

Carter said Covid-19 had added a second blow to Far North people already hit hard by drought.

"We are well aware some businesses won't survive. We're well aware some businesses that are currently shut have decided open again and some are working through whether to open again."

He said the council had made its decision on the rates reduction and seeking repayment of this from ratepayers in the coming few years knowing those impacts could worsen in 12 months.

Advertisement

"We don't know what's going to happen next week, in six weeks or in six months."

The council would deal with that situation at the time, reconsidering its rates relief as needed.

The council also set up a $300,000 economic recovery and support fund to support those impacted by Covid-19 and drought. It will be managed by the mayor, deputy mayor, chief executive and general manager-strategy and planning.

Carter said this would go some way towards helping the community including businesses, and households who were impacted.

Subscribe to Premium