Tararua District Council considers ‘smoothing’ of rates ahead of ‘steep rise’

Tararua District Council could opt for a “smoothing” of rates to defer a portion of a pending 16.29% hike.

The district’s mayor, Tracey Collis, told Hawke’s Bay Today that “smoothing” meant that council budgets are initially underfunded and recovered gradually in future years.

She said they tried hard to make sure everybody paid their fair share and didn’t think the cost would be pushed out for future generations to pay.

“We are really conscious of that intergenerational debt,” she said.

Last week councillors deliberated the Three Year Plan and the need to increase rates by 16.29% in 2024/25 to “deliver on responsibilities to the community”.

About 500 submitters contributed to the consultation.

A council spokesperson said it recognised the “steep rise”, so the rates smoothing option was consulted.

The spokesperson said the recommended and widely agreed approach was to support the smoothing.

Rates created healthy deliberations for the Tararua District Council. Photo / Paul Taylor

A compromise of smoothing rates over three years with a “softening” of the 2024/25 rates requirement being recovered over the following two years was reached.

“Under this option, the average increase is spread out over three years to be 12.09% in 2024/25, 10.13% in 2025/26, and 10.71% in year 2026/27,” the spokesperson said.

The council had initially proposed three options. The first would see no rates smoothing in the first year of the Long Term Plan, in this option the rate increase is highest in the first year.

The second option suggested rates smoothing over three years, with less financial impact for ratepayers in year one of the Long Term Plan so the highest increases would be in years 2-3.

The third and preferred option of the TDC would mean rates smoothing over six years, which could see rates increase higher in the fourth and fifth years.

Discussions centred around the risk of this approach, with concerns that a six-year period was too lengthy.

The council also decided to retain general and fixed rates for differential roading rates and introduce a “heavy vehicle” rate.

There will also be district-wide town centre refurbishment rates.

The deadline for adopting the Long-term Plan came up for some heavy discussion at a meeting in March.

In the meeting, councillors had resolved to adopt an unaudited Long-term Plan (LTP) by June 30, 2024, but management had since advised that this was not going to be possible.

An extraordinary meeting was called in which the group manager of corporate, Raj Suppiah, asked the council to rescind the earlier resolution and extend the timeline to July 31.

He told councillors this would provide enough time for auditors to firstly work alongside the council to review the LTP before it went out to consultation, and then audit the final document from mid-June.

These changes along with the new fees and charges will take effect when the 2024-2034 LTP is adopted on July 31 this year.

Michaela Gower joined Hawke’s Bay Today in 2023 and is based out of the Hastings and Central Hawke’s Bay newsrooms. She covers Dannevirke and Hawke’s Bay news and has a love for sharing stories about farming and rural communities.