Unpaid rates bill tops $4.8m

At the end of February, $4,801,680 was owed to the Rotorua Lakes Council in unpaid rates and penalties. Photo/File

More than $4.8 million is owed in unpaid rates in Rotorua - with owners of one property owing more than $57,000.

Figures requested by the Rotorua Daily Post showed that at the end of February, $4,801,680 was owed to the Rotorua Lakes Council in unpaid rates and penalties.

The figures showed the owners of 2905 properties owed more than $50 while the most owed on a single property was $57,979 which dates back from July 2012.

The council's chief financial officer, Thomas Colle, said in the case of the biggest rates debt, the council had taken all available steps that could be taken within the boundaries of legislation, without success.

He said because there was no mortgage on the property, the council couldn't place a formal demand on the mortgagee, and because it was owed by multiple owners, it couldn't be sold because of the unpaid rates.

"No further legal processes are available to council and the debt will lapse as 'statue barred' after expiration of six years."

He said the council wrote off about $100,000 worth of unpaid rates each year.

Mr Colle said the council collected about 99.5 per cent of rates ever year. He said action was taken against all those who didn't pay.

Initially the council wrote to property owners to try and secure payment amicably, but if that failed they took a more forceful approach such as a formal demand on mortgage or lodging the debt with Baycorp, or legal action through the courts. Failing that, the council can ask for the power to force the sale of the land where the land is general title, however in the past five years no Rotorua properties had been sold because of unpaid rates.

"Rate sales are always the last port of call."

At the moment there are 57 properties under legal action and 1118 were notified to the mortgagees as required by rating legislation. Most of these were paid by the ratepayers or mortgagees without the need for further action. Only two of those remained outstanding and were expected to be collected.

When asked what extra projects the $4.8 million would pay for if recovered, Mr Colle said the council operated a balanced budget.

"If the $4.8 million was collected, council would apply [it to the] existing capital works programme."