Water funding just part of upcoming Central Hawke's Bay rates rises

Rate increases ranging between 5.4 per cent and 7.4 per cent have been proposed for the first year of the CHB District Council's draft Long Term Plan 2018/2028. Photo / Paul Taylor

While the Central Hawke's Bay District Council is proposing an average rate increase of 3.2 per cent a year for the next 10 years, some ratepayers will be facing a much heftier hike in the year ahead.

The 2018/2028 draft Long Term Plan was adopted by the council last week, which was now seeking feedback on its approach to funding the significant infrastructure demands facing the district in the next 10 years.

In the 2018/19 year the increases would vary across the district ranging from a 1.8 per cent increase for a medium value property at Te Paerahi beach to a 16.7 per cent hike for Tikokino ratepayers.

In Waipawa and Waipukurau, the increases ranged from 5.4 per cent to 7.7 per cent ($115 to $199) depending on the value of the property, but only small increases were projected for commercial properties in the two townships, and there were decreases in some rural areas.

A key element of the plan was changing the funding of water and wastewater infrastructure to a model that would see 5 per cent of the rates funding requirements paid by all ratepayers, not just those connected to the water networks.

In addition, the plan considered future water needs and supply reliability, including investigating increased drinking water storage for Waipukurau should something happen to the Pukeora reservoir or the pipe into town, and a large trunk main from Otane to supply water to Waipawa.

While this would see rural ratepayers helping pay the cost of the town's water and wastewater networks, with an additional charge across all ratepayers of $48.71 a year, another contributor to the rates increase was linked to the uniform "leadership and economic development/social development" rate.

Council chief executive Monique Davidson said that in Tikokino, $79 of the $115 increase for 2018/19 was attributed to this charge.

She said the leadership aspect was the cost of having a governing body, including representation reviews, elections, annual and long term plan processes and salaries.

Another driver of the increases in community, economic and social development was the change from a targeted rate for the Waipukurau and Waipawa main streets to a uniform rate that would include other townships and communities around the district.

Mrs Davidson said $50,000 a year had been budgeted to create town centre plans for the main town centres, and also community plans for Tikokino, Takapau, Porangahau, Otane and Ongaonga.

"The leadership, economic and social development activities have been insufficiently budgeted to deliver the level of service we have either been delivering or need to deliver to ensure that as an organisation we are thriving."

Only small rate increases were in store for commercial ratepayers in the first year as the universal charge for water had been offset by the economic development (or main street) rate going across the whole district rather than just the commercial sector.

From 2019 to 2023, however, increases between 3.5 per cent and 6.4 per cent were projected. Rural percentage increases were less dramatic, generally ranging between 2 and 4.4 per cent over the next five years, with small decreases in some areas in the year ahead.

Adding to the projections was the clear message that came through the Project Thrive process of the importance of environmental sustainability, particularly around water, Mrs Davidson said.

"While we acknowledge that rural ratepayers will not necessarily be connected to the water infrastructure, we all need the towns to thrive - this is about looking at the wider community."

At this point, the plan had not taken into account all of the costs of investigating solutions to make the Waipukurau and Waipawa wastewater treatment plants compliant.

Any changes arising from that would be considered in upcoming annual plans, which would go out to consultation.

"The council has been very clear that we need to look for other sources of funding, we can't continue to rely on the ratepayers to fund infrastructure for future generations," said Mrs Davidson.

Consultation on the draft long term plan would take place between February 19 and March 29.