The Independent Pricing and Regulatory Tribunal (IPART) today released decisions on applications made by 13 councils to increase general income above the 2.3 per cent rate peg from 1 July 2018, including Ballina and Lismore.
The applications made by nine councils – including Ballina and Lismore – were approved in full.
Ballina applied for a 15.0 per cent cumulative increase over two years to be retained permanently in the rate base.
Lismore applied for a 0.41 per cent single year increase to be retained in the rate base for five years (applies only to business rates).
Also approved were applications from Bellingen Shire, Balranald Shire, Clarence Valley, Hawkesbury City, Kempsey Shire, Randwick City and Shoalhaven City.
Increases requested by Kiama Municipal and Muswellbrook Shire councils have been partially approved, while the applications from Upper Hunter Shire and Willoughby City were not approved.
IPART Chair Dr Peter Boxall said special variations are ‘designed to give councils the flexibility to generate additional income above the rate peg to meet their specific needs, and have a direct impact on the rates paid by land owners’.
‘The rate peg is calculated each year to reflect changes in the standard operating costs of local government such as labour, electricity and construction works,’ Dr Boxall said.
‘Councils requiring additional funds to improve services, financial sustainability or to fund new capital works can apply for a special rate variation after consulting with their communities and meeting other criteria set by the Office of Local Government (OLG).
‘The OLG criteria emphasize the importance of councils’ communicating their proposed special variations… to enable ratepayers to understand and provide feedback to councils on their proposals,’ Dr Boxall said.
It is a mater for each individual council to determine how it collects rate revenue across different categories of ratepayer, and how the special variation increase is distributed amongst ratepayers.
The impacts on individual ratepayers will also vary due to land re-valuations and the decisions made by councils about how to allocate rate changes amongst their communities.
IPART has attached conditions to the approvals requiring the additional income to be used for the purposes outlined in the application, and that councils report to their communities each year about how the additional revenue is spent.
IPART will set the next rate peg, to apply from 1 July 2019, in September this year to provide councils with more time to prepare annual budgets and consult with their communities if they are considering applying for a special rate variation.
Note: All percentages include the 2.3 per cent rate peg applicable to all NSW councils in 2017-18, and the assumed rate peg in subsequent years.
Full reports can be found on IPART’s website.
