22 Feb 2023

Red-stickered Auckland homeowners may need to pay rates

From Checkpoint, 6:07 pm on 22 February 2023

Aucklanders forbidden from entering their properties for almost a month may still need to pay their rates bills come next Tuesday.

While some other councils affected by Cyclone Gabrielle are providing rates remission for red-stickered homeowners, Auckland Council has chosen not to, instead requiring affected people to apply for assistance.

For some residents it's a frustrating and costly hurdle.

Julie Armstrong faced a rates bill of almost $750. When Auckland flooded at the end of January, water streamed through her Northcote Point property, causing a slip.

She has not yet been able to return to check the extent of the damage.

"As soon as the slip occurred, we had to evacuate, so we don't really know."

Since then, her family has spent a week at an Airbnb for $2300, before locking in a rental with a bond that cost six weeks' rent.

Although insurance covered some of the cost of moving around, it came with a heavy excess of $1000.

On top of this, Armstrong had to pay to replace essentials, including clothing left behind in her family's rush to evacuate.

"You're left with literally nothing," she said. "I mean, at the time we evacuated, I grabbed some stuff and shoved it in a bag, but certainly not enough to go for a month on."

Now, her upcoming rates bill could be the straw that breaks the camel's back.

"It's completely unreasonable," she said. "[The council] have decided that I have to leave my house - I haven't decided that.

"You're blocking me from it and telling me it's illegal to enter it and get the things that I own and pay for. You're also blocking insurance from being able to assess the damage and therefore pay me any money.

"You're making it impossible for me to get money to live, and then saying I have to pay you money for nothing in return."

Auckland Council said that rather than rates remissions, it would support people through grants. It said its emergency relief fund catered not only to property owners, but also tenants.

Residents could make applications through the council website or over the phone, though the latter option drew a laugh from Armstrong.

"Have you ever tried calling the council? For the love of God, I'll be on hold for six-and-a-half hours."

Since Auckland's flooding and Cyclone Gabrielle, the Citizens Advice Bureau has been inundated with queries about where to access help.

Deputy chief executive Andrew Hubbard said the organisation expected a surge in rates-related queries to come soon.

"As they realise that they'll be paying rates for properties that aren't inhabitable, they'll be wondering whether or not they should."

Hubbard said when it came to rates remission, the approach varied from council to council. He said Thames-Coromandel District Council's decision to automatically provide remission for people with red-stickered houses should serve as an example to the rest.

"It's one less thing, one less hassle, for people already undergoing very stressful situations; they don't have to go through what can be a complex application process."

Auckland Council head of rates valuations Rhonwen Heath said any changes to properties' rates would only occur where there was significant damage and the rating value was impacted.

These changes would only take effect on 1 July - after affected homeowners had already paid two more instalments, on 28 February and 31 May.

"This applies to all ratepayers, however we are very mindful that some ratepayers have been affected by the recent weather events and might have issues with paying their rates," Heath said.

She encouraged people who were unable to pay their rates to call the council to discuss options, including postponing payments without incurring penalties. She said the council would consider any applications on their merits.

[h] Initial reponse 'lacked empathy needed'

After this story went to air, Auckland Council contacted RNZ to say that its processes to support red-stickered homeowners would change. 

The process was outlined in a post on Deputy Mayor Desley Simpson's personal Facebook page.

“I am aware of the plight of those who have had their properties red-stickered but are still required to pay rates," Simpson said.

“I do not think our initial response had the empathy needed to reflect the stress and trauma people must have felt being red stickered and removed from their properties.

“I have spoken to the chief financial officer and the rating team and have agreed with them that Auckland Council will proactively contact owners of red stickered properties to discuss how we can support them financially at this time.

“There are many options available which can provide relief, and our staff will make sure residents are supported to obtain targeted support. Those people do not need to do anything – we will contact them to discuss their options."

[h] More lenience in Napier

Meanwhile in Napier, a rates instalment was due on 15 February as the cyclone ripped through the city.

Napier City Council investment and funding manager Garry Hrustinsky said although some rates were now overdue, the council would extend the window for residents to pay.

"By law, we have to issue a penalty notice to advise them, but thankfully, within our remission policy, we've got quite a bit of scope to be flexible with that."

Hrustinsky said the council would be looking to provide targeted rates relief to residents. He said it was something they had already worked through after Covid-19 and the Napier floods of 2020.

"The first time round, we created a new clause within our remissions policy, effectively our rates refund policy.

"It's a response to what we'd call 'significant extraordinary circumstances', and it's a bit of a coverall.

"Within that, it allows council fairly sweeping powers to provide targeted rates relief to people that have been impacted."

Hrustinsky said the council had set an initial budget of $200,000 to cover the refunds.

Napier City Council would meet tomorrow to discuss whether to recognise the 'significant extraordinary circumstances' and give affected ratepayers a rates remission.