Christchurch ratepayers face lower rates than planned, but a bid for no rates increase failed.
Rates in Christchurch will be lower than originally planned. Photo: Colin & Linda McKie/ 123rf
Christchurch City Council had planned to increase rates by an average of 4.65 percent, but revised its draft annual plan for 2020-21 so the average rates increase is 3.5 percent, said mayor Lianne Dalziel.
The average residential rate rise is 2.23 per cent, meaning $62.05 more a year for an average house with a value of $508,608.
"The first 2020-21 budget approved in February proposed a 4.65 percent average rates increase which we put out for submissions at the beginning of March. Today's meeting acknowledges that the situation has changed dramatically," Dalziel said."
Six councillors - James Gough, Sam MacDonald, Catherine Chu, Phil Mauger, Aaron Keown and James Daniels - voted against the rates rise in the hope of having no increase.
In March, the six councillors called for a 12 month freeze on rates increases to minimise the burden on ratepayers during the challenging economic climate from Covid-19.
"We have been out-voted on a borrowed budget; instead we have a plan which proposes close to $100 million of additional capital projects that council management themselves identified as not a top priority for this coming fiscal year" said councillor Gough.
This view was shared by councillor Chu.
"The most effective way to help our residents right now would be to not charge them more," said Chu.
But Dalziel defended the rise.
"We're expecting a $33.3 million deficit to the end of this financial year as a result of lost revenue and dividends," Dalziel said.
"The expected impact from Covid-19 is a $50.5 million deficit for 2020 to 21. If that was simply absorbed into rates, it would have represented a 20 to 23 percent rates increase over 2020 to 21, which would have been untenable."
The draft annual plan for 2020 to 21 proposes capping capital spending at $400m, reducing the council's running costs by $23m, and increasing borrowing by $102m (includes $80m for 2020-21 and $22m for 2021-22). A total of $118m is set aside for 2020 to 21 for the Metro Sports Facility and Canterbury Multi-Use Arena.
Other changes include:
- Allowing the use of weed killers containing glyphosate in places where there is no direct contact with people (saving of $3.5m)
- Reducing grants to ChristchurchNZ and Heritage (saving of $3.3m)
- Reducing salary and wages by not filling vacancies (saving of $3.3m)
- Reducing external consulting budgets (saving of $3.3m)
- Reducing maintenance to essential work only (saving of $2.6m)
- Stopping funding to Regenerate Christchurch (saving of $1m)
- Additional revenue from charging for excess water use by the top 20 percent of residential customers ($2m). About 20 percent of residential households use more than 50 percent of water supplied.
The revised plan will be open for public feedback from 12 June to 29 June and will be adopted by councillors by the end of July.