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Rates up 5% but fears of 30% hit on some properties

INFORMATION presented to Derwent Valley councillors on the day of their annual budget meeting last week was that hundreds of ratepayers would pay much more than the proposed 5% rates increase, Cr Philip Bingley said during the meeting on Thursday night. Cr Bingley’s remarks came after the majority of councillors had opposed a move to delay deciding on the rates rise until other options were considered.

The attempt by Cr Wayne Shoobridge and Cr Bingley to defer the Derwent Valley Council’s decision on its rates and charges for the new financial year was defeated by five votes to two. Referring to big variations in the recent revaluation of properties in the municipality, Cr Shoobridge said the proposed 5% rate rise would have the effect of a 30% increase for some ratepayers.

“I trust we’ve all read through this thoroughly, we’ve had a couple of workshops on it,” mayor Michelle Dracoulis said when introducing executive manager Amanda McCall’s recommendation that the proposed rates and charges resolution be adopted.

Cr Shoobridge immediately moved that the item be deferred and this was seconded by Cr Bingley. Cr Dracoulis invited Cr Shoobridge to speak but then withdrew the offer due to the motion being a procedural one, for which debate is not allowed. The motion to defer the rates and charges resolution was defeated, with councillors Derksen, Browning, Dracoulis, Cosgrove and Lowe voting against it.

Debate then returned to the draft rating resolution and Cr Derksen said he appreciated the move to defer the consideration of the rates rise, noting that the recent revaluation of properties in the municipality had produced many disparities, including government valuations well above market values.

Cr Shoobridge said the revaluation Cr Derksen referred to was going to have an enormous effect on the municipality and councillors should consider information that had come to light in recent days. “We’ve only had the revaluation for about four weeks,” he said. Of the municipality’s 4418 residential properties, 38% of them, 1711, would have a rate rise of 5% or more. Continuing he said:

  • 22.98% (1015 properties) would see their council rates rise 12% or more
  • 17.95% of properties would have an increase of 15% increase or more
  • 172 residential properties would have a 30% increase.

“Yes, there’s going to be winners and losers, but I don’t believe that we’ve had enough time to model out other formulas and that was my reason for wanting to defer tonight,” he said. “It doesn’t seem equitable that we’re going to place a 5% increase that we want on our rights on 38% of residential properties. It just doesn’t wash.

“It is prudent of us as councillors to be looking after all the ratepayers, not just some. There should be something that we can do. We can come back in two weeks at a special meeting and set the rate. We don’t need to set the rate tonight if we haven’t looked at every option and I don’t believe we have, and I think we need to do it. Yes, this is an extraordinary event and we’ve got little control over it. But what we can control, we should at least have a go at.”

Cr Bingley said the impact of cost-of-living should always be in councillors’ minds when setting the rates. “For me, the benchmark is CPI, the consumer price index. For the 12 months up to March, it is 3.1%. For me, I can look at the ratepayers and say that is a fair thing because the CPI is generally used for wage increases, pension increases, so that sort of increase can cover our rates within that CPI range.

“On top of not only the 5% increase, we have got these revaluations and the information as late as today indicates that hundreds of ratepayers are going to be hit with rate increases of up to 30%. As a councillor I could never agree to that sort of resolution to do that, as Cr Shoobridge said, without further investigation. That’s my benchmark, CPI, and that’s were I’ll stand.”

Deputy mayor Luke Browning said Crs Shoobridge and Bingley had outlined “a lot of problems” but did not provide any solutions. “In view of that, I’m happy to support it as it is,” he said. Cr Browning said this did not mean that work could not occur behind the scenes for the next budget. “At this point in time, I don’t want to see delays occur, not getting the notices out, not getting the income in so we can provide the services and get projects done for the community.”

Responding to a question from Cr Shoobridge about modelling for rates to be levied based on land value, Ms McCall said the rates resolution was based on AAV (assessed annual value). “We have modelled differential rating today after numerous requests from councillors in the last couple of days. “We’re looking at flat rating and I can tell you that flat rating doesn’t have any positive impact,” she said.

Ms McCall said that on a flat-rating model, where every property is charged the same flat rate, 2900 of the 4418 properties would end up paying more than under the present AAV model. “Currently, there is 274 properties that pay the minimum rate. They would then be required to pay $1421, so in the scheme of people losing out, only 1509 would pay less,” she said.

Ms McCall said her team had worked tirelessly on the rates for weeks. “They have been answering questions ongoing, so to say that we haven’t done that … is highly offensive. We have answered every question that we have been asked and we have tried every model that we have.”

Cr Shoobridge said his question was whether the council had modelled land value. “No,” Ms McCall said. Cr Shoobridge began to say that was another method of rating but was cut off by the mayor calling for any other speakers.

Closing the debate, Cr Derksen said he had been speaking to ratepayers about the impact of property revaluations and made the point that these were not decided by the council. Anyone with a concern about their revaluation could object in writing to the valuer-general. He also suggested that property revaluations should be done earlier in the year to avoid clashing with council budget deliberations. “I appreciate the contributions from Cr Shoobridge and Cr Bingley,” he said.

When put to the vote, the rates and charges resolution was approved by a vote of 5-2. Those in favour were councillors Lowe, Cosgrove, Dracoulis, Browning and Derksen, with councillors Bingley and Shoobridge voting against.

In two subsequent motions, councillors voted to adopt the annual plan and budget estimates but the schedule of fees and charges failed to pass following a failed attempt to reinstate the full value of the council’s “tip tickets.” As a result, two tickets will still be needed to deposit a standard load of rubbish at the council’s two waste management facilities.

After the meeting, New Norfolk and Derwent Valley News asked Cr Shoobridge where he had sourced the numbers about the potential rate increases being up to 30%. He said the information had been provided by the council to all councillors.

Disclosure: Wayne Shoobridge is associated with New Norfolk and Derwent Valley News as a contractor in the advertising department. He is not involved in news production.

See more Derwent Valley and Central Highlands news online and read our print edition every second Friday.

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