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Rate-rise distribution is unfair

Opinion Piece

From September roading will get a major investment boost from the Government and the ratepayer. That will be good for the region, jobs and growth. However, who pays and who benefits is not being fairly distributed.

City ratepayers face an average 7 percent rate increase, horticultural properties even more, while pastoral farmers are in for a rate decrease.

The unfairness of this rate-rise distribution is pronounced when you look at the council’s expenditure. Its proposed 10-year budget invests $3-4 million more ratepayer money a year into roading in 2018/19 compared to 2015/16. The vast majority of that roading budget is being lined up for forestry routes and back-country roads. However, the overwhelming burden of increased cost is falling on city ratepayers, many of whom have low and fixed incomes. It is also falling on horticultural property owners. Without change these ratepayers can expect to receive a bare-minimum roading service.

What is needed is for:

• the average city rate increase to be capped at no more than 5 percent; and

• for ratepayers in the city and on the horticultural flats to receive the roading service they are paying for.

That will require change to the council’s 10-year budget, road plan and final rate strike — which will only happen if councillors advocate for city and horticultural ratepayers, and city ward councillors use their numbers around the table.

If you want a fairer rates increase distribution and fairer road investment, it’s important to submit on the council’s plans by this Friday.

We have got into this unequal situation because of the council’s one road network policy, which loads costs on to the city ratepayer. It’s a policy that needs to be revisited to strike a fairer 50:50 balance between network and the payer receiving the service they pay for.

The council charges a targeted rate differential for roading that is proposed to collect $3m a year from city ratepayers. Once the Transport Agency’s 64 percent roading subsidy is added, this $8.3m per year should be invested on the city and surrounding roads.

However it is not. Nothing like it.

That money is being diverted to forestry routes and rural roads. Meanwhile the city faces significant traffic growth, including heavy vehicles, alongside growing road condition, safety and efficiency problems.

Similarly on the flats, with both high traffic (an average 5500 vehicles a day) and heavy vehicles (850 a day) on State Highway 2, there are significant road condition, safety and efficiency issues.

The productive horticultural and food processing industry, and the people who live and work on the flats, are paying for but not receiving their fair share of road service.

Two key sectors of our economy, the city and the flats, are being overlooked and underserved.

The local roads plan needs transparency for these sectors. Its opaque nature avoids accountability on where the road maintenance and surface renewals budget will be invested.

With regard to forestry, the council’s proposed budget increases the forestry targeted road rate to $1.5m per year. This unfortunately is well short of the annual road maintenance cost attributable to the forestry industry which is at least $2.7m a year for the rural network alone. The ratepayer and resident is currently subsidising these forest industry costs.

Most of us are supportive of the forest industry and the jobs it creates. However, that does not mean we are willing to subsidise these costs when the benefit will be banked into the forest owners’ accounts.

Similarly the city is supportive of the farming industry, but that does not mean city ratepayers are willing to subsidise rural road costs while the city roads and flats do not receive their fair share.

John Kape