Planning for our future - proposed Special Rate Variation and Rates Harmonisation

Proposed Special Rate Variation

At the Council Meeting held on Wednesday 28 October 2020 the Interim Administrator resolved to commence community engagement on the following options for a Special Rate Variation.

1. A permanent SRV of 18.5% plus 2.0% rate peg (total 20.5%) commencing in 2021- 22;

2. A permanent SRV of 8.5% plus 2.0% rate peg (total 10.5%) commencing in 2021- 22; and

3. Discontinuation of the temporary SRV of 10% (above the rate peg) applied by the former Armidale Dumaresq Council and ending on 30 June 2021

• and on or before 27 November 2020, formally notify IPART that Council intends to submit a Special Rate Variation application;
• and that the community engagement will also cover rates harmonisation impacts effective 1 July 2021; and that the Special Rate Variation and Rates Harmonisation community engagement period runs from Monday, 2 November 2020 through to Thursday, 10 December 2020.

Introduction

In June 2021 a temporary Special Rate Variation (SRV) of 10 percent (above the rate peg) applied by the former Armidale Dumaresq Council over a seven year period will expire, reducing Council’s overall rates income by $1.5 million annually. Income generated from the temporary SRV has paid for the maintenance and renewal of community assets including roads, bridges, storm water drainage and facilities like the Armidale Town Hall, village halls, parks and gardens and other buildings managed by Council.

To maintain current levels of service Council must apply this year to the NSW Independent Pricing & Regulatory Tribunal (IPART) to have the temporary SRV made permanent. Before making a submission, Council will consult the community on three options for an SRV including a higher SRV amount to allow for further investment in maintaining our infrastructure, in particular renewal works on our roads, bridges and community buildings and facilities.

Like many Councils across the State, Armidale Regional Council is struggling to continue to provide the broad range of services without increased revenue. At present Council’s revenue is regulated by the Independent Pricing and Regulatory Tribunal. IPART sets a rate peg that limits the amount Councils can increase their total rate collection by each year. Unfortunately the rate peg has not kept pace with the increasing cost of maintaining our assets and providing services to the community.

It has been a difficult few years for the Armidale region and like many rural areas, Council revenue has been heavily impacted by drought and now Covid-19.

Our priority now is to get back to basics in delivering important essential services to ratepayers and the community. Ensuring that we have enough revenue to continue to deliver services to the community is essential in this rebuilding phase.

Consultation

During the next five weeks we will be engaging with the community on three SRV options for consideration in our final proposal to IPART and provide further clarity on the mandatory process for harmonisation of rates.

This page contains FAQs and a Fact Sheet that will assist you in making an informed decision. Below is a schedule of engagement opportunities and how you can provide feedback to Council through a formal submission.

This is a lot of information to digest and understand so please take this opportunity to engage with Council.

A dedicated SRV and rates harmonisation hotline on 1300 364 366 has also been established to assist you with any enquiry you may have during the consultation period.

Submissions

Feedback from the community is encouraged via a formal submission to Council.

Address submissions as 'Submission SRV and Rates Harmonisation'

By email: council@armidale.nsw.gov.au

By Post: Armidale Regional Council PO Box 75A, Armidale 2350

Drop-off: Armidale Civic Administration Building, 135 Rusden Street or at the Guyra Civic Administration Building 158 Bradley Street.

Submissions close midnight on Thursday 10 December 2020

Rates Harmonisation

Since amalgamation of Armidale Dumaresq and Guyra Shire Council in 2016 Council has been required to maintain two rating systems for the local government area. This was due to a four year rate freeze imposed by the NSW Government. This meant that Council could not adjust rates beyond the rate peg in the first four years after amalgamation which saw different rates being paid in the former local government areas.

Under current legislation Council must maintain one consistent rating structure to ensure a fairer and more equitable system across all rating categories within the Armidale Regional Local Government Area. This will take effect from July 1 2021 and will only affect general rates. There will be no increase in total rates collected by Council due to harmonisation, but the distribution between rate categories needs to be made more equitable. It is a complex process to find the fairest outcome and your understanding will be much appreciated.

The challenge in harmonising rates is recognised by Councils across NSW and by the State Government. The Minister for Local Government has committed to taking a bill to the Parliament early next year which would provide options for Council to implement rates harmonisation more gradually. There is no guarantee that the bill will be passed by Parliament so we must continue under the current law and current date of July 1 2021. Council has focused on creating the most equitable rate structure for all ratepayers.

Council welcomes and values feedback and is acutely aware it must ultimately make the fairest decision which will impact some ratepayers positively and others negatively.

Engagement opportunities

Village meetings

Pop-ups

Webinar

Face-to-face meetings