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Wairoa nod to new rates system

Wairoa District councillors have commended staff and themselves after a “journey and a half” to overhaul the region's 25-year-old rating system.

Councillors voted to simplify the system from more than 30 rating categories to just five at an extraordinary meeting on Tuesday.

The new rating differentials, which are rates based on different land uses, would be broken down into commercial, rural, residential, forestry and residential with a capital value of more than $399,999.

It would all be applied to a capital value based general rate.

Rates affordability for houeholds was central to the revamp, with the initial proposal saying urban properties were paying an “unaffordable” share of the costs.

The initial proposal, which sought to transfer rates from residential and commercial sectors to rural and forestry, received backlash from the rural sector including Federated Farmers which said it agreed with the principles of affordability and simplification, but the proposal had “missed the mark”.

After more than 250 submissions and two days of hearings, the initial proposal was refined which included softening the impact on rural.

Councillors deliberated in a meeting on December 22, before making their final resolutions on January 12.

They voted to keep the variations in residential and commercial differentials as the council's original proposal at 1.0 and 1.6 respectively.

The forestry variation rose from 3.32 to 4.0, while the rural variation has gone down from 1.0 to 0.7.

They also added a new differential on Tuesday — the variation of residential properties with a capital value of more than $399,999 will be 0.8.

Councillors voted to create a new general rate based on capital value, and to move 10 percent of the water, wastewater, stormwater and waste management rates to the general rate.

They also resolved to move 50 percent of the uniform annual general charge to the general rate.

Mayor Craig Little commended the team, saying it had been hard for staff and elected members.

He reflected on the submissions they received from the community, and the extensive hearings.

“A lot of people were happy with what we were trying to do, but maybe we had swung too far one way and we obviously heard there was quite a bit of sting for some,” he said.

He had been through two rating reviews over the past 10 years and nothing had changed, he said.

“We have known that we've had a problem for years . . . It would be easy just to sit there and do nothing but we're obviously here for the future of our organisation and the future of our district,” he said.

He also said a differential factor of 4.0 for forestry reflected community feedback that this sector contributed less towards the social, economic and environmental wellbeing of the district.

During hearings about the rates review, business leaders in forestry critisised the council for targeting their industry and fueling negative sentiment towards them.

Councillor Denise Eaglesome-Karekare said it had been hard to tackle.

“It is a blunt tool that we have to set rates and the bluntness of the tool can cause dips and swings and unintended consequences,” she said.

But she believed staff and councillors had done a great job to get to this point.

“I think we've actually listened to the community . . . and that's why we're at where we're at.”

Councillor Melissa Kaimoana said it had been a “journey and a half”.

“I think that we were also quite lucky to have this in our first term because we now have a very good, comprehensive understanding of how our rating system works . . . and why it's like this.”

Interim chief executive Kitea Tipuna commended councillors for the courage to change a system that had been around for a long time.

“I commend elected members for having the serious conversations, months of pre-engagement, community consultation, community feedback . . . (and for) being able to hopefully today come to a resolution that is true to the principles of the proposal: simple, affordable and appropriate.”

Councillors also instructed the chief executive to develop policies to enable the new rating system to take effect on July 1, and to update the revenue and financing policy for public consultation in the 2021-31 long-term plan.

The rates review also highlighted differences between forestry land that is classified as Indigenous and that which is Exotic, and the council would consider this and decide if it was appropriate to rate land planted in exotic and indigenous forests the same.