North Sydney Council staff have proposed doubling rates in an attempt to stave off a ‘very weak’ and ‘unsustainable’ financial outlook.
Council will discuss four special rate rise options to be put out to community consultation at its 25 November meeting, in the face of the $51 million debt for the North Sydney Olympic Pool.
North Sydney has one of the lowest rates in Sydney, but attempts to rationalise its post-COVID-19 budget, where it lost some $10 million in revenue, with redundancies and other cuts, have been ineffective.
Most councils across Sydney have applied to regulator IPART for a special rate rise as they battle the post-COVID-19 income dent, rising building costs and soaring interest rates. Willoughby approved a 15% rise earlier this year, and Northern Beaches Council is looking at a 13.8% rise for 2025/6.
Mayor Zoë Baker told NL that she was ‘frustrated and angry’ that residents would be asked to ‘be part of a financial repair solution to a decision that I spent four years trying to prevent.’
“The last thing you do is go out to the community and ask them to pay more.”
However, internal ‘efficiencies’ had not been enough to prop up the budget leakage due to the pool blowout, Mayor Baker said.
The proposed rises would be staggered over three years. The base option would be a 50% rise (65% cumulative over three years), which would see the current average of $1,040 increase to $1,511. The largest rise would be 111%, which would start at $1,611 and rise to $2,127 in the third year.
The basic option enables just financial repair; whereas the highest rate would enable new infrastructure and increases to services – much of which has been stalled with money for projects redirected to prop up the ballooning pool project costs.
The report states the pool budget blow-out had put council in a ‘weak financial position and with an unsustainable forecast.’ It puts the blame squarely on the 2020 council which entered into the pool contract without designs being finalised. “Significant risk was taken and has been realised, resulting in increased capital and operating costs.”
Mayor Baker said council was ‘at a crisis point because of the impacts of the dreadful pool project.’ “I’ve been saying to our community that there will come a reckoning and we’re going have to make tough decisions. And to me, this is the time.”
The mayor supports a special rate rise but refused to say by how much, as she first wants to ‘hear from the community and that will inform the decision that’s finally made.’