Rates rise forecast
Marianne Gillingham
A projected rate rise of around 7.4 percent in Gisborne and a 3 to 4 percent increase in council fees will be the first big challenge for councillors today at the start of an election year.
Driving the rise is the increase in loan funding required for building Gisborne’s new wastewater treatment plant, inflation and additional depreciation resulting from this and asset revaluations.
The total rates income required to meet this year’s 10-year community plan requirements is $45.32 million, up from $42.7m last year.
Debt levels are projected to rise to $46m, from $36m last year, along with an increase of almost $1m in interest, from $2.4m last year to $3.3m this year.
The council also faces increased staff costs as a result of changes in ACC levies and KiwiSaver, increased depreciation on landfills and bad debt increases.
Combined, the increases are expected to drive rates up by 6.1 percent overall. This would translate to an average increase of around 7.4 percent in Gisborne, or $175 more per household, and an average of 4.4 percent in rural areas.
More than half the rates increase is due to the wastewater project and the council is still banking on a $7.2m grant from the Government to cover the cost of separating food processing waste from the sewage stream.
On the positive side, council staff are continuing their project to trim $1m in operation costs, which equates to 5 percent of an estimated $20m operations budget.
At the end of last year they had already achieved nearly $500,000.
Staff saved a further $1.3m in roading costs as a result of changing the contracts to take advantage of favourable market conditions.
Further savings have yet to be verified but the end-of-year result is expected to carry an operating surplus of $3m.
Big projects in the community plan for the coming year include an upgrade of the War Memorial Theatre, work towards a cycleway through the Motu, progressing plans for developing the inner harbour area and ongoing work on walkways around the city.
Township developments are also planned for Patutahi, Ruatoria, Manutuke, Matawai and Motu, Rangitukia and Tikitiki, Te Puia Springs and Waipiro Bay.
Following any changes resulting from councillors’ input on this year’s budget, a full round of community consultation is planned, with meetings to be held in many urban and rural centres from March 2 to March 25.
Dates and venues are to be notified.