Waitaki Residents Face “Tough Ask” as Council Approves 22% Rates Hike
In an extraordinary Waitaki District Council meeting on Tuesday, local councillors “reluctantly” agreed to a 22% rates increase for the upcoming financial year. The decision comes as the council attempts to address a projected $14 million operating deficit.
A Long-Term Financial Struggle
The decision follows a period of significant fiscal instability. Mayor Mel Tavendale noted that the council has accepted deficits for nine out of the last ten years, explaining that the community has not been rating enough to cover actual operating costs. An expensive water services programme has also contributed to a surge in expenditure for local authorities.
During the consultation process, the council explored several potential paths, including rates rises of 19%, 27%, and 45%, before settling on the 22% increase. To mitigate the deficit, the council also approved several budgetary shifts, including:
- A $5.3 million reduction in the water programme.
- A $1.2 million increase in roading investment.
- Reductions of $383,000 across other budgets.
- Cuts totaling almost $100,000 to operating budgets for training, travel, and catering.
While these changes are intended to lower the council’s debt position, they are not expected to resolve the operating deficit.
Community Impact and Local Concern
The financial implications for Waitaki residents are significant. The community’s median income is $32,000, which is $10,000 less than the national average. This economic reality has fueled intense concern among the public.
“It’s going to be a real tough ask,” said Mayor Tavendale.
The announcement has met with substantial pushback. More than 500 submissions were received, and some ratepayers have called for a government probe into the council’s finances due to fears that residents could lose their homes. Councillor Mata’aga Hana Fanene-Taiti raised concerns regarding the ability of certain community members to absorb the costs, asking if the council had considered the potential gap for those unable to pay.
Councillor Jim Hopkins, who voted against the increase, described the hike as a “monstrously huge amount” and noted that the level of anger among residents has been unprecedented. He suggested that the cost may lead some people to consider leaving the district altogether.
Demands for Internal Reform
The Waitaki Ratepayers and Residents Association has criticized the council for not focusing sufficiently on internal cost-cutting. Association chairperson Ray Henderson argued that while the council has discussed deferring projects, it has not yet demonstrated a “culture” of cutting internal expenditure. Henderson suggested that the council should also look toward increasing revenue by attracting more businesses to the region.
Future Outlook
As the council moves into the next financial year, several developments may follow:
- The council is exploring payment plan options to assist ratepayers in managing the increase.
- Residents may consider relocating outside the district due to the increased cost of living.
- The council could face continued pressure to implement more dramatic cuts to internal spending or to focus on revenue generation through business attraction.
While Council Support Services Director Paul Hope noted that costs could ultimately be recouped if the council were to sell properties, Mayor Tavendale clarified that forcing the sale or lease of property to recover unpaid rates is not the direction the council intends to take.
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