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Environment Southland Settle On 4.9% Rate Increase

Jul 01, 2020
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Environment Southland approved its Annual Plan 2020-21 at today’s Council meeting. The focus is on striking a balance between meeting growing expectations to deliver on increasingly complex projects and recovering financially in a post-COVID-19 world.

The annual plan is forecasting a deficit of $2.7 million and sets the overall rates increase at 4.9%, which is lower than the 5.9% forecast in the Long-term Plan 2018-2028.

When the Council began planning its work programmes and budgets more than six months ago COVID-19 was unheard of.  Environment Southland chairman Nicol Horrell said the Council has taken the time to consider its position, make savings on expenditure and to carefully plan for the present to medium term.

“Carefully managing our expenditure now and in the years ahead is a critical part of our strategy to move the Council from a $2.7 million deficit this coming year to a balanced budget by 2024-25.

“In setting rates councillors were mindful of the community’s ability to pay in the post-COVID-19 environment while also ensuring we are able to continue to meet our environmental responsibilities. We are increasingly being asked to do more with the Government’s freshwater package upon us, our Water and Land plan in its final stages in court and the need to continue building greater resilience within communities to the impacts of natural hazards and climate change.”

Chairman Horrell said regional council rates increases are not as high in dollar terms as the percentage may indicate.

An example ratepayer with a house in Invercargill worth $235,000 would pay $16 more next year based on an overall rate increase of 4.9%. A range of sample rates are provided in the Annual Plan 2020-2021. Actual dollar amounts will vary from property to property as the overall rate is made up of a mix of land and capital value rates. The impact of the changes is lessened to a degree by the Uniform Annual General Charge, but changes in valuation relativities are likely to affect many properties.

The Council recently released statements outlining an expected significant reduction in income in 2020-21 due to COVID-19 of $3.5 million (relating to drops in cruise ship fees and the investment portfolio); and its saving in expenditure of $500,000 on what was budgeted in the Long-term Plan 2018-2028.

Chairman Horrell said even though the Council has a strong balance sheet, developing the annual plan had been challenging and came on top of the costs related to repairs of flood schemes following the floods in the Waiau in December 2019 and the Mataura catchment in February, which totalled about $5 million; $2 million of which would be met by reserves tagged for this purpose.

This coming year the Council will be offering people the option of paying their rates in three instalments without penalty, via direct debit. More details on this will be available when the rates are struck in September.

The Annual Plan 2020-2021 will be available on the Environment Southland website es.govt.nz today and from our office, cnr Price Street and North Road Invercargill or by calling 0800 76 88 45.

Samples:

Example property:

House in Invercargill with a valuation of $235,000

Current ES annual rates $173  
4.9% overall rate increase by ES = $ value $16
Total ES rates for 2020 $189

 

Example property:

Sheep farm in Lumsden with a valuation of $2,955,000

Current ES annual rates $1,868  
4.9% overall rate increase by ES = $ value $30.00
Total ES rates for 2020 $1,898

Note: Actual dollar amounts will vary from property to property as the overall rate is made up of a mix of land and capital value rates. The impact of the changes is lessened to a degree by the Uniform Annual General Charge, but changes in valuation relativities are likely to affect many properties.

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