Notice of Meeting:

I hereby give notice that an ordinary meeting of the Dunedin City Council will be held on:

 

Date:                             Monday 11 December 2017

Time:                            10.30 am or at the conclusion of the previous meeting whichever is later

Venue:                          Edinburgh Room, Municipal Chambers,

                                      The Octagon Dunedin

 

Sue Bidrose

Chief Executive Officer

 

Council – 10 Year Plan

SUPPLEMENTARY AGENDA

 

MEMBERSHIP

 

Mayor

Mayor Dave Cull

 

Deputy Mayor

Cr Chris Staynes

 

Members

Cr David Benson-Pope

Cr Rachel Elder

 

Cr Christine Garey

Cr Doug Hall

 

Cr Aaron Hawkins

Cr Marie Laufiso

 

Cr Mike Lord

Cr Damian Newell

 

Cr Jim O'Malley

Cr Conrad Stedman

 

Cr Lee Vandervis

Cr Andrew Whiley

 

Cr Kate Wilson

 

 

Senior Officer                               Sue Bidrose, Chief Executive Officer

 

Governance Support Officer      Lynne Adamson

 

 

 

Lynne Adamson

Governance Support Officer

 

 

Telephone: 03 477 4000

Lynne.Adamson@dcc.govt.nz

www.dunedin.govt.nz

 

 

 

 

 

 

 

Note: Reports and recommendations contained in this agenda are not to be considered as Council policy until adopted.

 


Council

11 December 2017

 

 

 

ITEM TABLE OF CONTENTS                                                                  PAGE 32     

Reports

33        2018/19 Rating Method                                                                               4                 

       


Council

11 December 2017

 

 

Reports

 

2018/19 Rating Method

Department: Finance and Corporate

 

 

 

 

EXECUTIVE SUMMARY  

1      The draft budget as presented has an overall increase in rates of 6.9%. This increase in rates is collected through various funding mechanisms within the rating method. 

2      The proposed changes to the rating method are discussed in this report.  These include increases to the community services targeted rate (increase of 1.5%) and the Forsyth Barr Stadium differentiated rates (increase of 1.5%).

 

1     RECOMMENDATIONS

That the Council, for the purposes of community engagement:

a)     Approves an increase in the community services targeted rate for the 2018/19 year based on the June 2017 Local Government Cost Index (LGCI) of 1.5%, to $233.50 including GST.

b)     Approves an increase in the Forsyth Barr Stadium differentiated rates for the 2018/19 year based on the June 2017 LGCI of 1.5%.

c)     Approves the current rating method for the setting of all other rates for the 2018/19 year.

 

BACKGROUND

3      The purpose of this report is to detail the proposed changes to the rating method for the 2018/19 year.

4      In addition, the Council established the Rates and Funding Advisory Panel to review and provide advice on matters relating to the rating method. This report provides an update on the work undertaken to date by the Panel.

5      Please note that unless specified, all rating figures in this report are GST inclusive.

DISCUSSION

6      The draft budget for the 2018/19 year proposes a 6.9% increase in rates. This increase in rates is collected through various funding mechanisms within the rates policy.  The proposed changes are now discussed in more detail.

Community Services Rate

7      Over the past few years it has been agreed that the community services targeted rate should be increased annually by the Local Government Cost Index (LGCI).  An allowance for the June 2017 LGCI of 1.5% would increase this from $230.00 to $233.50 for the 2018/19 year.  The community services rate is a fixed charge on all rateable properties.

Forsyth Barr Stadium Rates

8      Since the 2013/14 year, the differentiated Forsyth Barr Stadium rates have been inflation adjusted annually. For the 2018/19 year, it is proposed to increase these rates by the June 2017 LGCI of 1.5%.

Schedule of Rates

9      Attachment A, summary of current and proposed rates, provides details of the individual rates and the amount collected from each rate.

10    Attachment B, summary information, provides a summary of fixed charges and general rates.

Overall Impact

11    The following table shows the overall rates income (including GST) by property category for 2017/18 and 2018/19.

Category

2017/18

($’000)

2018/19

($’000)

$ change

($’000)

% change

Residential

102,245

108,855

6,610

6.5%

Lifestyle

4,966

5,297

331

6.7%

Commercial

46,822

50,573

3,751

8.0%

Farmland

4,699

4,978

279

5.9%

Total

158,732

169,703

10,971

6.9%

 

12    The table below shows, for the average value property in each category, the total estimated rates for 2018/19.  The examples include general rates and the community services rate for all properties.  Targeted rates are included for residential and commercial properties only.

Including GST

Capital Value

Total Rates

2017/18

Total Rates 2018/19

$ change ($’000)

% change

Residential

326,800

2,126

2,255

129

6.1%

Lifestyle

561,000

1,773

1,911

138

7.8%

Commercial

1,307,000

14,733

15,862

1,129

7.7%

Farmland

1,157,000

2,923

3,148

225

7.7%

 

13    Attachment C provides further sample property rate impacts for each category of property. The sample property rate impacts incorporate:

·           The forecast rate increase of 6.9%.

·           An increase of $3.50 in the community services rate.

·           An increase of 1.5% in the differentiated rates paid by the Forsyth Barr Stadium.

Rate Maximum

14    Under the Local Government (Rating) Act 2002, certain rates must not exceed 30% of total rates revenue.  This includes the use of a uniform annual general charge and any targeted rates that are set on a uniform basis excluding targeted rates set solely for water supply or sewage disposal.  Based on the draft budgets, these rates represent 25% of total rates revenue.

Rate Rebate

15    When considering the affordability of rates on low income households, for the 2016/17 year, around 2,900 residential properties received a government funded rates rebate.  The average rebate was $558; the maximum rebate available was $610.

Rates and Funding Advisory Panel

16    The Panel was established to consider matters relating to the rating method. The initial work of the Panel was focused on issues identified during the last two Annual Plan processes and other matters referred to the Panel for consideration.

17    A summary of the matters considered is provided below.

Rating methods for residential properties with multiple studio rooms

18    It was requested by the Council that staff consider rating policies for residential properties with multiple studio rooms.

19    No changes are recommended by the Panel because the status quo is felt to be appropriate.

General rate differentials

20    The Panel considered the six general rate differential categories the Council currently has in place and of changes to these differential categories over time. General rate differential information from several other Councils was provided for comparison.

21    No further changes to the general rate differentials are recommended by the Panel because the status quo was felt to be appropriate.

Rates Rebate (Retirement Village Residents) Amendment Bill

22    The Panel were provided with an update on the Rates Rebate (Retirement Village Residents) Amendment Bill, which seeks to extend coverage of the rates rebate scheme to residents of retirement villages whose property ownership is governed by an Occupational Right Agreement and pay rates either directly or indirectly.

23    In July 2017, the Local Government and Environment Select Committee recommended that the Bill not proceed. The Panel agreed that the matter be left to the incoming Government to determine.

Rate Remission Policy regarding Māori freehold land

24    The Panel considered a draft Māori Freehold Land Rates Remission Policy. The draft policy will now be considered by the Runaka and the Council.

25    The draft policy will be provided in a separate report for consideration by the Council early next year.

North Dunedin Targeted Rate Scheme

26    The Panel considered imposing a targeted rate in North Dunedin to cover the additional cost of cleaning glass from the streets in the North Dunedin campus area. It was recommended by the Panel that the Council continues with the cleaning scheme in the North Dunedin area but does not progress with a targeted rate.

27    The Panel will consider at a later date targeted rate options for recycling and refuse collections in the North Dunedin campus area.

Warm Dunedin Targeted Rate Scheme

28    The continuation of the scheme was considered by the Panel. The panel recommended that the Council continue with the scheme. The continuation of the scheme is reflected in the draft budget.

Rating differential for rental properties

29    The option of a rating differential to encourage rental property owners to obtain a property warrant of fitness check was not pursued by the Panel.  It was agreed to wait for further action by the new Government.

Tourism Targeted Rates

30    Consideration was given to residential properties being used for short-term commercial accommodation, notably Air Bed and Breakfast establishments. Staff were requested to investigate this topic and provide further information for future discussion.

31    Further work will also be undertaken by staff to review the current Tourism/Economic Development Targeted Rate.

OPTIONS

32    No options are provided as this report is giving effect to the current rate method and previous decisions of the Council.

NEXT STEPS

33    If adopted, the proposed rating method will be included in the supporting documentation that accompanies the draft 2018/19 budget and other 10 year plan information.

34    While the Council is engaging with the community on the draft 2018/19 budget, rate account information is available on the DCC website that shows the proposed rating impact by individual rate account.

 

Signatories

Author:

Carolyn Allan - Senior Management Accountant

Sandy Graham - General Manager Strategy and Governance

Authoriser:

Gavin Logie - Acting Chief Financial Officer

Attachments

 

Title

Page

a

Summary of current and proposed rates

10

b

Summary information

11

c

Sample rates

12

 

SUMMARY OF CONSIDERATIONS

 

Fit with purpose of Local Government

This decision relates to providing a regulatory function and it is considered good-quality and cost-effective.

Fit with strategic framework

 

Contributes

Detracts

Not applicable

Social Wellbeing Strategy

Economic Development Strategy

Environment Strategy

Arts and Culture Strategy

3 Waters Strategy

Spatial Plan

Integrated Transport Strategy

Parks and Recreation Strategy

Other strategic projects/policies/plans

 

This decision fits with the strategic framework because it provides the necessary rates funding to implement the activities included in the draft 10 year plan.

Māori Impact Statement

Key stakeholders have been consulted in the development of the draft Māori Freehold Land Rates Remission Policy.

Sustainability

There are no implications for sustainability.

LTP/Annual Plan / Financial Strategy /Infrastructure Strategy

The proposed rating method will be set out with the draft 10 year plan material during the community engagement period.

Financial considerations

The proposed rating method will be set out with the draft 10 year plan material during the community engagement period.

Significance

This decision is considered low in terms of the Council’s Significance and Engagement Policy.

Engagement – external

The proposed rating method will be set out with the draft 10 year plan material during the community engagement period.

Engagement - internal

Internal engagement has occurred with staff in the relevant departments.

Risks: Legal / Health and Safety etc.

There were no risks identified.

Conflict of Interest

There are no known conflicts of interest.

Community Boards

There are no known implications for Community Boards.

 

 


Council

11 December 2017

 

 

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Council

11 December 2017

 

 

PDF Creator


Council

11 December 2017

 

 

PDF Creator


 

PDF Creator