Far North council curbs rates increase to 2.23%

8:25 pm on 5 June 2020

Far North District Council is to slash more than 40 percent of its next year's planned rates increase in the wake of Covid-19.

Far North District Council's headquarters in  Kaikohe.

Far North District Council's headquarters in Kaikohe. Photo: Google Maps

The council today decided on a 2.23 percent rates increase, 43 percent less than the 3.94 percent increase it had been planning for the 2020/2021 financial year starting on 1 July.

Far North District Council (FNDC) mayor John Carter said it was the first time the council had done a major rates reset of the type decided on today.

"I've never seen the situation we're now facing in more than 50 years in local government," Carter said.

The 2.23 percent rates rise would be simply to keep in line with Local Government Cost Index (LGCI) indexed inflation.

It was decided at FNDC's online council meeting today, and will be formally adopted on 30 June.

Carter recently warned job losses for contractors and staff would result from his council cutting rates for the coming year due to Covid-19 impacts, but today said FNDC had been able to achieve its rates reset without that.

It had done this in three ways: by trimming operating costs; by putting off 24 percent of maintenance and depreciation rates collection for the 2020/21 year to be spread across the following five years; and by spreading some other council costs over the following two or three years in the same way.

FNDC funds all its asset depreciation costs from rates.

Carter said Covid-19 had added a second blow to Far North people already hit hard by drought.

"We are well aware some businesses won't survive," he said.

"We're well aware some businesses that are currently shut have decided not to open again and some are working through whether to open again."

He said the council had made its decision on the rates reduction and seeking repayment of this from ratepayers in the coming few years - knowing those impacts could worsen in 12 months.

"We don't know what's going to happen next week, in six weeks or in six months," he said.

FNDC would deal with that situation at the time, reconsidering its rates relief as needed.

The council today also set up a $300,000 economic recovery and support fund to support those impacted by Covid-19 and drought.

It will be managed by the Mayor, Deputy Mayor, chief executive and general manager-strategy and planning.

Carter said this would go some way towards helping the community, including businesses and households who were impacted.

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