Effectively the application for a 69.94% rate rise is inclusive of and to lock in permanently to the rate base, the 19% including rate peg, and 17% including rate peg increases, levied across the 23/24 and 24/25 years, based on the temporary SRV approved by IPART across these two years.
Made at council’s extraordinary meeting on Tuesday, the decision was flagged by the previous Federation Council before last September’s election.
Supporting the motion were Crs Andrew Kennedy, Rowena Black, Pat Bourke, David Harrison, Sue Wearne and Mayor Cheryl Cook. Against the motion were Crs David Bott, Derek Schoen and Richard Nixon.
A joint report by Federation Council’s General Manager Adrian Butler and deputy general manager Jo Shannon warned councillors about not accepting their recommendation for the SRV application to IPART.
“Should the application not be endorsed, effectively those increases are removed from the rate base placing council in an extremely vulnerable financial position with respect to managing assets and maintaining service delivery, whilst still retaining financial liquidity to meet commitments. Significant service reductions would be required,” the report for Tuesday’s extraordinary meeting stated.
“In addition to the additional rates sought, council continues on its productivity and efficiency program, and as evidenced in the application, has delivered over $700,000 of savings/efficiency improvements in the previous year, and makes further commitments in future years. Unfortunately, savings and productivity and efficiency improvements alone are not enough to arrest years of underfunding, with this being a systemic issue across many rural and regional councils.”
Cr Kennedy strongly encouraged fellow councillors to vote for the special rate variation application, mentioning that before the formation of Federation Council in 2016, both former councils of Urana and Corowa Shires were to seek SRVs, a recent independent study on the current shire’s assets revealed a shortfall of $164 million in asset renewal and that the rate increase to achieve the desired result would be 167% - a lot more than Federation Council is seeking.
Cr Derek Schoen flagged his intention for an alternative motion, to delay the SRV pending further evidence of in-house cost-cutting measures which was supported by Cr David Bott.
Cr Schoen said he hasn’t taken his course of proposed action lightly, acknowledging all the work which has gone into producing the paper work for councillors’ consideration.
Deputy Mayor Black said council cannot continue to defer the SRV. “We need to make the hard decision now. We’re nearly half-way through to the end point already,” she said.
“For the sake of people now and into the future we need to have these rate rises.”
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