Solution sought to rates proposal stalemate

A working group is to be formed to hammer out a solution to the standoff between the Far North District Council and quarry owners who, under the council's proposed fairer rating system, face massive rate increases.

The council's 2013-14 draft annual plan includes a proposal aimed at making the industries causing the greatest damage to the district's roads pay a fair share of maintenance and repair costs. One of the consequences would be a rate increase for the quarrying and mining sector averaging more than 900 per cent (one in Kaitaia would see a rise of 1066 per cent). Forestry (166 per cent) and dairy farming (15 per cent) would also pay significantly more.

Quarry owners say the plan, if adopted, would lead to closures, job losses, and increased road maintenance costs that the council would end up paying.

A similar 'fairer' rating proposal was voted down by councillors last year while Mayor Wayne Brown was overseas. Amongst the changes this time is a separate rating category for mines and quarries, after forest owners said it was unfair that they had previously been included in the relatively lightly-rated industrial category.

Several quarry operators, all strongly opposed to the proposal, spoke at hearings in Kerikeri last week. One of them, Transfield quarries manger Neil Cates, said the proposal would increase road maintenance costs and stifle development and jobs. He questioned the assumptions behind the council's calculations, and said it was unfair that some quarries faced huge increases while others paid nothing.

Quarrying would be pushed away from the heavily-rated sites and pop up at locations under the radar. It could result in aggregate being trucked in from outside the district, and create a barrier to the mining industry the council was hoping to attract.

Mr Cates said charging a roading rate using a land value-based differential made no sense. The roading rate would be better based on tonnage of goods transported, the current road-user charges (RUCs) or a GPS system capturing actual truck movements.

Councillors agreed, but said by law, rates had to be based on land value.

Cr Monty Knight called for a working group to develop a policy for mines and quarries that was sensible and palatable.

"The last place council would want to over-tax is the sector that provides road maintenance and construction," he said.

Mr Cates conceded the rates currently paid by quarries were low, but they did not have the margins to pay the kind of increases the council was proposing. They were, however, prepared to pay their fair share.

Mr Brown said rating on land value was a blunt instrument but was the system chosen by government. The council was seeking ideas from the forest and quarry industries on alternative methods such as charging by weight and distance travelled on council roads, especially as the government was unwilling to share its RUCs income.

Transfield operates five quarries in the Far North, the biggest on Puketona Road, near Paihia. Other submitters on quarry rates included Straterra, the Aggregate and Quarry Association, Fulton Hogan and Imerys Tableware, which operates the china clay quarry at Matauri Bay.