Invercargill homeowners have been landed with the $1.9 million cost of funding Invercargill City Council's contribution to Venture Southland, even though the council and its executives promised the cost was to be paid by businesses.
The commitment was given by council executives at a public meeting on the draft long-term plan in April during a discussion about plans to drop the rates differential (higher rates charges) levied against commercial operators.
That meeting was assured that homeowners would not have to pay more if the council dropped the higher rates for commercial property owners because as a tradeoff the businesses would have the Venture cost added to their rates.
However, in the final audited long-term plan the Venture costing has been levied against general rates while the reduced commercial rate remains.
Council finance committee chairman Neil Boniface now says assigning the $1.9m charge to business rates in the draft long-term plan was a mistake that had since been corrected and approved by Audit NZ.
However, in April council finance director Dean Johnston told a North Invercargill public meeting that increasing the economic development rate (paid by businesses) from $60,000 to $1.9 million would target the cost of the service to those who received it.
And chief executive Richard King said it was one of several changes planned to more fairly and transparently rebalance the rates burden without having a big impact, if any, on existing ratepayers.
"That is why - whilst we've taken away the differential on businesses - we're not asking you as a resident to pay for the cost of the CBD development. We're not asking you as a resident to pay the cost of Venture Southland."
Mayor Tim Shadbolt later cited amendments to the general, parks and reserves, and pools rates among those most submitters supported.
But Venture Southland funding has been built into the rates bills homeowners received last week, whereas the benefits outlined for businesses passed through substantially intact.
The council has introduced new uniform annual charges of $57.50 for parks and reserves, and $28.75 for pools, with the balance of rates funding for these services charged solely to residential and lifestyle property owners.
The street lighting and footpaths portion of the general rate increased from 10 per cent to 15 per cent.
All differentials were removed except the rural-farming differential, which reduced from -55 per cent to -20 per cent (a discount on the rate), and the differential for the second and following units in a block of flats, which reduced from -50 per cent to -25 per cent.
A working group is planned to investigate the most equitable way of rating multi-unit properties in future.
- The Southland Times
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