COUNCIL’S general manager Catherine Dale has moved to get the ball rolling on an application to increase rates higher than the Consumer Price Index (CPI).
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Council rate rises are annually set by the Independent Pricing and Regulatory Tribunal, a system known as rate pegging, and are usually capped at CPI.
However this week Ms Dale sought approval from councillors to prioritise community infrastructure projects for consideration of a Special Rate Variation (SRV).
In a report presented to council last night, Ms Dale said a 2013 Resourcing Strategy identified a need for increased revenue in order to maintain assets and service levels, and while council had “aimed to more efficient” and made savings, it had a shortfall of funds.
“The cost of local government services has risen faster than inflation and council’s income is limited by the state government rate pegging that has been at least 0.5 per cent below inflation each year for the past 10 years,” Ms Dale said.
“There is a financial gap with the current level of funding… This leads to a significant and growing annual infrastructure renewal gap which is estimated at more than $3 million per annum.
“It is recommended that council considers how it will address this gap.”
Ms Dale said the options were to increase revenue by a rate increase above the rate peg amount, reduce services or service levels in council’s general fund operations, or allow infrastructure assets to continue to deteriorate.
“An SRV is one way of providing additional funds to deliver and provide community infrastructure requested by the community, that cannot be funded from current revenue,” she said
The application for an SRV would need to demonstrate need and purpose, evidence the community is aware of the proposal, evidence it is based on realistic assumptions, and an explanation of productivity improvements and cost containment strategies realised by council in past years.
Ms Dale’s recommendation is to compile a list of community infrastructure projects for consideration as part of an SRV, and preparation of a detailed community engagement strategy.
The recommendation was approved.