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Eurobodalla not on current list seeking Special Rate Variation


Fourteen councils across NSW have notified the Independent Pricing and Regulatory Tribunal (IPART) of their intention to apply for a special variation to increase their general income above the rate peg in 2019-20. Eurobodalla is not listed in the latest statement issued December 1st. With just one more meeting before Council takes a six week summer break the Eurobodalla appears to be sticking to the assurance given by Mayor Liz Innes that there would not be another Special Rate Variation sought under this term of Council. Councils were asked to notify IPART by 30 November 2018. The fourteen who have notified now have until 11 February 2019 to consult with their communities and submit their applications for a special variation increase. The councils lodging notifications include seven from the Sydney metropolitan area and seven from rural and regional NSW. The Sydney councils are Burwood, Camden, Hunters Hill, Ku-ring-gai, North Sydney, Randwick and Sutherland. The regional and rural councils are Dungog, Kiama, Lithgow, Muswellbrook, Port Stephens, Richmond Valley, and Tamworth. Special variations are the mechanism for councils to use if they want to increase their general income by more than the rate peg to fund items such as infrastructure or additional services, or to improve their financial sustainability. Under the rate peg, all NSW councils are eligible to increase general income from rates by up to 2.7% in 2019-20 upon a vote by the elected Councillors. Councils seeking a larger increase must consult with their communities and seek IPART approval, before they are able to adopt higher rates. IPART assess the applications against criteria set out in the Office of Local Government’s guidelines. These criteria include demonstrating the need for the additional income, evidence of adequate community awareness and an assessment of the reasonableness of the increase and impact on ratepayers. While over 11,000 Eurobodalla Shire residents signed a petitions stating that they considered the submission of Council's proposal in February 2015, on 19 May 2015 to the Independent Pricing and Regulatory Tribunal (IPART) be "reasonable" nor affordable. At the time Councl's General Manager Dr Dale said that a rate variation would be a financially responsible direction for Council and the community who have clearly indicated that they want Council to maintain the current level of community and transport infrastructure and services in the future. 'It would be an important step in meeting the NSW Government's new financial criteria and increasing Council's medium and long term financial sustainability. Councillors chose to ignore the 11,000 signature petition and simply receive and note the feedback and results of the community consultation with the Motion, on being put, declared CARRIED with Councillors Leslight and Innes voting against the Motion. The Special Rate Variation saw IPART give permission to Eurobodalla Shire Council that allowed an increase of the general rate amount by 6.5%, including the rate peg amount, for a period of three years.The rate variation was applied from July 2015. At the end of the third year, rates were to stay at this new higher level and increase every year by the annual rate peg amount set by IPART. Council said at the time "Despite making considerable savings and securing grants and external funds, we would not have been able to meet the community's needs in the years ahead with the previous rates income. With the special rate variation, we do not have to cut service or maintenance levels and can invest in and renew community and transport infrastructure for the future." Earlier this year Councillor Pat McGinlay, seeking clarification around a financial issue, had it revealed that the Council's Water fund and Sewer fund, which are not controlled by IPART had traditionally run at an annual profit from the increases Council places on water and sewer charges. It was also revealed by Council staff that these "profits" are redirected into the General Fund which is hamstrung by CPI increases and that future Council budgets expect the same dividend exposing this premediated expectation as a conscious action by Council revealing that annual water and sewer rate increases are factored into the annual revenue stream and are in fact built into council's financial plan.

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