Council to look at options to ensure viability
The community will likely soon be asked whether it will accept a minimum 14 per cent rate rise, as council struggles with a $5.1 million budget deficit for 2024/2025 – with $255 million needed in the next 10 years for asset renewal.
The new council is meeting on 2 November to discuss council’s budget, with a vote on putting rate rise options out for community feedback expected this month or next.
Managers warned back in June that council’s income levels were ‘no longer sufficient’ to fund enormous budgetary requirements, with $524 million in expenditure for 2024/25 alone, and a staggering gap of $255 million required over 10 years to replace ageing infrastructure, already backlogged because of unexpected costs like the $8.9 million emergency services levy.
“(This) scenario is not sustainable and without intervention will continue to reduce services to the community,” managers said.
While it was not voted on, staff recommended a 14% rate rise for 2025/26, made up of a 10.6 per cent standard rate variation (SRV) and 3.4 per cent predicted for CPI, increasing rate income by $20 million. This would help stave off an expected deficit for 2025/26 of $10.2 million. Only the independent regular IPART can approve SRVs, after council has engaged in community consultation. Over the last two years, NBCdozens of councils have gone down a similar path as they struggle with high inflation and post-COVID-19 deficits.
Mayor Sue Heins told PL that ‘there is a growing gap in our ability to invest the funding required to maintain our infrastructure and meet the service levels expected by our community.’
“Council is facing growing pressure to its financial sustainability as increases in income have not reflected the rising costs of materials, contracts, and construction, with Sydney’s inflation being more than double the increase in rates income.”
While the mayor has in the past supported CPI rate rises, not all councillors agree this is the way forward.
Vincent De Luca is advocating for council to ‘first look internally and at other innovative ways to prevent rate payers being flagged again. We have to look at our management structure, the car pool and cost savings.’
Mr De Luca, who said the rate rise had previously been flagged as high as 24 to 27 per cent, said council should look at co-use of its vacant lands as a means of generating income.
Cr Candy Bingham, who may have the deciding vote on the issue, told PL council was in ‘dire straits.’ “(Some) infrastructure’s well over 100 years old. I think it’s inevitable. We don’t have any choice because it doesn’t matter what we cut back or how many staff we get rid of, it won’t produce enough money.”