Rotorua deputy mayor criticises ‘unfair’ rates swap proposal

Rotorua Lakes Council and the Bay of Plenty Regional Council held a joint workshop on Wednesday. Photos / Laura Smith

Rotorua’s deputy mayor Sandra Kai Fong has criticised a suggested council “rates swap” as unfair and a misnomer.

While ratepayers would pay the same, she thinks it would make the district council look like the “bad guys” with a rates rise.

Bay of Plenty Regional Council last year decided to lower its targeted Rotorua rate for lakes restoration work, and this week suggested Rotorua Lakes Council up theirs.

The idea was that impacted ratepayers would pay similar overall, and the district council could put money where it needed, such as the Tarawera Sewerage Scheme.

The $31 million to $32m scheme came about after fears for declining water quality prompted new regional council rules around effluent treatment.

About 450 affected Tarawera households either needed to connect to reticulated sewerage or seek consent to upgrade their wastewater systems — though consent was unlikely to be granted if reticulation was doable.

It is partially funded by the Ministry for the Environment and both councils — about $10.7 million total — and the rest by Tarawera ratepayers.

The most recent indication was $38,000 to $41,700 (GST exclusive) per connecting household, with some resident groups asking for it to be capped at $36,600 (GST inclusive), others at a lower amount.

The regional council presented to the district council during a Wednesday workshop, where no decisions were made.

Rates swap pitched as way to lower Tarawera cost burden

Regional councillor Kevin Winters outlined what a rates swap solution would entail.

The regional council consulted on and adopted its targeted Rotorua rate decrease through its 2024-2034 Long Term Plan process last year.

The reduction from about $160 a household would reach zero in the next three years.

There would be no loss of service with the regional general rate to cover the about $10m yearly investment.

Lake Tarawera near Rotorua. Photo / Laura Smith

Rotorua ratepayers would pay $31.78m (GST exclusive) less to the regional council if implemented over 10 years.

The idea was the district council could then reflect the decrease of the regional council rate in an increase to its own lakes enhancement rate.

All district ratepayers pay that rate, so scheme cost could be spread wider if it was put to that.

Kai Fong criticised the regional council decision for a “swap” as a misnomer, made without district council discussion.

She echoed a previous comment of councillor Rawiri Waru that it could have left the rates as they were and provided funding in a different way.

Kai Fong said it was unfair to suggest the district council raise its rate while the regional council lowered its own, worrying it would not be obvious to the public.

Deputy mayor Sandra Kai Fong at a previous council meeting. Photo / Laura Smith

She clarified to Local Democracy Reporting after the workshop she believed it made the regional council look like the “good guys,” the district council the “bad guys,” and all the while ratepayers would be paying about the same.

Regional council chief executive Fiona McTavish said both councils were committed to working towards protecting and improving the lakes for future generations.

The Tarawera scheme was a “vital part of that broader commitment”.

Mayor Tania Tapsell suggested at the workshop the regional council could uplift its targeted rate for Rotorua lake restoration.

Winters also said the regional council was discussing whether it could offer the district council a two-year interest-free loan of $4m for Tarawera.

Councillor Conan O’Brien said it still needed to be repaid, and was despite the regional council having changed the rules that prompted the scheme.

He believed the regional council could have used its Rotorua targeted rate to cover scheme costs.

Councillor Kevin Winters at a previous Bay of Plenty Regional Council meeting. Photo / Alex Cairns

McTavish said earlier it would look to develop a Water Quality Funding Policy when Local Water Done Well policy progressed.

In response to O’Brien, McTavish said it updated its plans and rules to meet national standards.

The district council was responsible for reticulation, she said. It declined Long-Term Plan process requests for reticulation funding as it tried to minimise rate rises.

Councillors earlier heard the regional council contributed $750,000 and it was not required to contribute more.

Tapsell said both had outcomes it needed to achieve “in the most affordable and efficient way” it could.

• This story has been updated to clarify that some resident groups were asking for the cost to be capped at $36,600 (GST inclusive), others at a lower amount.

Laura Smith is a Local Democracy Reporting journalist based at the Rotorua Daily Post. She previously reported general news for the Otago Daily Times and Southland Express, and has been a journalist since 2019.

- LDR is local body journalism co-funded by RNZ and NZ On Air.