Unhappy about rates policy flip

Federated Farmers believes Rotorua Lakes Council should be more transparent

The rural community is profoundly disappointed with the council, and concerned that increased council spending will affect debt levels leaving farms unaffordable to run.

At four meetings Federated Farmers hosted on the 2015 Long Term Plan, those present revealed they are facing rates increases of almost 70 per cent.

These rate increases on farmland are way beyond the average limit set last year.

A major component of the increase arises from a funding policy change, which reduces the level of the Uniform Annual General Charge (UAGC) in favour of capital value rates.

The discussion on rating methods in the consultation document implies that the share of rates paid by ratepayers is largely based on a property's value.

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This does not reflect the reality where the council has a number of mechanisms for adjusting the distribution of property value rates, such as the UAGC, to achieve an equitable allocation of funding for its services as outlined in the Local Government Act 2002.

Federated Farmers is totally opposed to the council reducing the UAGC from $560 to $410. This is a major funding policy change that is not supported by analysis to show the reasons for re-allocating UAGC revenue to capital value rates.

The reduction in the UAGC exacerbates the effect of the recent revaluation on dairy farms and works to drive up rates on higher value properties.

The council should, as a matter of funding policy, show the proportion of rates revenue derived by the UAGC. Its level should be at the maximum of 30 per cent of rates revenue.

Federated Farmers believes Rotorua Lakes Council should be more transparent on how much the cost of borrowing is affecting rates. Particularly borrowing related to the airport initiative.

The council must urgently review its priorities as the debt proposed to be incurred through the term of this plan is in our view unsustainable.

-Submissions on Rotorua Lakes Council's Long Term Plan 2015-2025 are now closed