Rates increase lowest in decades

LOUISE BERWICK
Last updated 05:00 21/02/2014

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The Invercargill City Council has proposed one of its lowest rating increases in decades, but several key challenges the council face this year have been excluded from the budgets.

However, finance and policy chairman Neil Boniface is confident they will not make a huge impact on the proposed rate increase of 0.43 per cent this year.

The draft increase, which will see the council slash funding for sport turfs, council staff training, and the increase of dog registration and parking costs, was released in the finance and policy agenda yesterday.

Council chief executive Richard King and Invercargill Mayor Tim Shadbolt are touting it as a huge success, but some councillors remain sceptical about such a low increase.

Councillor Boniface said he believed it was one of the lowest increases since the mid 1990s and showed a "change in culture" in the council.

The first draft of the rates increase had projected a 3.72 per cent increase, but that had been decreased by "getting rid of the fat" and a significant success in negotiations.

"We are not cutting any key core services, I think it's sustainable."

The council's major success was negotiating an electricity contract which would save $500,000 each year for the next three years, he said.

He conceded it was "a coincidence" that the contract came up for renewal this year.

The Bluff Pool looks set to be a victim of the increase, with the original grant of $180,000 cut to $130,000 because the budget indicated a lower cost for the operations.

However, Anderson Park Art Gallery, which was shut recently after a building report showed it failed to meet building standards, has not been taken into account, nor have the issues facing Kennington.

The uncertainty surrounding the city's storm water and the cost to clean it from pollutants has also not been taken into account.

But Boniface said some of those issues may be resolved with reserve funds and he hoped to know the exact costs in the coming months, so they could be factored into the final rates increase.

"There's no sense in putting money in the budget, which is a culture we have done, for rainy days."

First-term councillor Karen Arnold said the small increase was a good start and showed the council was beginning to understand that people expected the council to operate within its means.

There were still savings to be made by the council and she wanted "the cost of doing business" and operating the council to be looked at, along with its financial commitment to Venture Southland.

Councillor Lindsay Thomas was not so positive about the increase, saying it left little room for unknowns, such as issues around earthquake strengthening.

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"I hope it's not too low, because I don't want us to have a spike. I would be comfortable with 1.5 per cent."

- The Southland Times

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