Hamilton City Council has approved an immediate jump to a capital value rating system in its proposed 10 year plan.
Capital value is where rates are calculated on the value of the land and what is built on the land rather than just the land itself.
Since 2014, the city has been transitioning from a land value-based rating system to capital value, however the council's proposal in the 10 year plan would implement the change completely from 2018/19.
To combat the extreme rate rise for some properties, the council is also proposing a Uniform Annual General Charge (UAGC) of $500 per property.
The UAGC is a flat fee to reflect base costs which apply to all residents and ratepayers. It would form part of a property's rates bill and would not be additional.
The capital value change means higher value properties would have a larger rates rise.
Net rates for a median residential house (CV $405,000)are now $2099; the switch with the proposed 15.5 per cent rates increase would increase rates to $2307 with UAGC included, an overall increase of 9.89 per cent.
In Huntington with a higher value property (CV $1,250,000) net rates are now $3,981. The proposed change would increase rates to $6,077 with UAGC included, an overall increase of 52.64 per cent.
Councillor Dave Macpherson was opposed to the UAGC, saying those in lower valued houses would take the hit.
"I don't believe we should be putting in a rating system that shifts the burden away from where it sits at the moment," Mr Macpherson said.
"Having a UAGC applied which will benefit particularly the higher value properties – those worth about $750,000 – which is only two per cent of our properties — and shift some of the burden on to lower value properties.
Councillor Angela O'Leary said the move to include a UAGC is not fair.
"I certainly think Robin Hood would say it isn't fair as we are taking from the poor and giving to the rich," Ms O'Leary said.
Ms O'Leary also said that the senior council staff found it difficult to explain the change to the rating system.
"A rate system has to be clear, understandable and fair," Ms O'Leary said.
"You need to look no further for an unfair rate system than applying a UAGC."
"My concern is for people living in lower value homes in Hamilton where you can reasonably assume they will be on a lower income."
Councillor Garry Mallett supported the UAGC, due to the immediate jump to capital value.
"We all get some base level of amenity when living in Hamilton, irrespective if you're a millionaire or a pauper," Mr Mallett said.
"There is some base level that we should all pay."
With Mayor Andrew King's proposed 15.5 Immediate move to capital valuations
I certainly think Robin Hood would say it isn't fair as we are taking from the poor and give to the rich.
Cr Angela O'Learyper cent rate rise included, an immediate move to capital value and a $500 UAGC, the council's net rates graph shows a property owner in Hamilton East (CV $450,000) could have a 62.97 per cent rates rise from $1539 to $2508, which includes the UAGC.
A Rototuna property (CV $680,000) would increase a rates bill from $3090 to $3534, a 14.34 per cent rise, and also includes the UAGC.
Councillors voted 7-5 in favour of Mayor King's immediate switch to capital value proposal.
Those opposed were councillors Casson, Henry, Mallett, O'Leary and Southgate
Those in favour were Mayor Andrew King, Deputy Mayor Martin Gallagher and councillors Tooman, Macpherson, Pascoe, Bunting and Taylor.
The council then voted 7-5 to to propose a $500 uniform annual general charge.
Those in favour were Mayor Andrew King and councillors Tooman, Mallett, Pascoe, Bunting, Taylor and Casson
Opposed were Deputy Mayor Gallagher, and Councillors Henry, O'Leary, Macpherson and Southgate.
The council's 10-year plan meeting is nearly completed, with councillors debating from 9am until 11.30pm on Wednesday. It was due to resume at 2pm yesterday for a final session.
Other decisions to be included in the the 10-year plan are:
■Councillors approved giving six months to the Hamilton i-SITE to find a way to break even, after Mayor King proposed shutting down the visitor information centre. Councillors were told that the i-SITE loses roughly $500,000 a year.
■Council also approved the sale of the heritage building, St Peter's Hall. Councillors Southgate and O'Leary voted against selling the building. If sold the building will reduce costs for council.
■Waiwhakareke Natural Heritage Park also made its way on to the 10 year plan as the council plans to open the park to the public.
■Councillor Southgate attempted to get a small amount of money to go towards funding for Chartwell and Hillcrest library, but a hung vote meant Mayor King used his casting vote against it.