Auckland bed tax battle highlights search for tourism funding

More than 200 Auckland commercial accommodation providers will now pay higher rates to help finance tourism promotions ...
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More than 200 Auckland commercial accommodation providers will now pay higher rates to help finance tourism promotions and events.

Auckland's targeted rates saga may play out elsewhere. Amanda Cropp reports

The scramble for tourism funding continues with other councils tipped to follow Auckland's lead and raise money through targeted rates.

More user-pays charges, such as Tekapo's $1-per-pee ablution block, are also on the cards as local authorities try to cover the cost of building and maintaining tourism facilities. 

Auckland City's new targeted rate - widely referred to as a "bed tax" even though strictly speaking it's not  - came into force on Saturday and applies to about 215 commercial accommodation providers. 

It was modified to exclude holiday parks, backpacker lodges and some motels, and will contribute $13.4m towards tourism promotion and events, instead of up to $30m as originally envisaged. 

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Hospitality New Zealand's general manager accommodation Rachael Shadbolt believes other financially pressed councils will now consider going down the Auckland route to help pay for tourism facilities and promotion.

Pay as you go: Tekapo's new toilet block charges patrons $1 a head in what could be a growing trend for cash-strapped ...
JOHN BISSET/FAIRFAX NZ

Pay as you go: Tekapo's new toilet block charges patrons $1 a head in what could be a growing trend for cash-strapped councils.

If they did, she said the Queenstown system of targeting rented holiday homes and businesses was much fairer than the Auckland approach.

"Waiheke is being pinged, but Rodney is not. It's all a bit messy."

Still not enough

Local Government New Zealand chief executive Malcolm Alexander supports the recently announced New Zealand First policy of returning GST from international visitors to regions where the money was spent, and tagging it for tourism infrastructure.

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He said the Government's $110m tourism infrastructure fund spread over four years was simply not enough and it was likely other councils would follow Auckland's example.

"We've been told to use our existing tools and that's it, so essentially we're confined to debt and rates, and that [includes] a targeted rate."

The industry is exploring the possibility of legally challenging Auckland's targeted rate, but  Alexander said the city had strong case for the special levy.

"If legal action ultimately found that there's not that power … then that accentuates the funding issue even further."

Minister decries money grab

KiwiCamp creator Chris Wagner says interest in user pays is growing and his freedom camping pod more than covers its ...
Derek Flynn/Fairfax NZ

KiwiCamp creator Chris Wagner says interest in user pays is growing and his freedom camping pod more than covers its running costs.

Tourism Minister Paula Bennett is unhappy about Auckland's decision to target the accommodation sector  describing it as "piecemeal and confusing" for visitors.

"I think an additional cost to the tourist on top of what they are paying for rooms in some places would be seen as quite unattractive."

Bennett is also fed up with the Government being painted as a scrooge over the new tourism infrastructure fund announced in the Budget.

She said larger expensive one-off projects could receive additional funding if there was a compelling business case.

"I feel like the sector and local government should get on with spending what we have got, and presenting a good case, instead of constantly going for the money grab."

Spending a penny

Tekapo's $1-a-pop toilets are expected to cover their $12,000 to $15,000 a year running costs and Bennett is all for it. 

"I don't think international tourists would mind paying a small nominal fee to use a very clean and well placed toilet."

Alexander said user-pays for facilities such as toilets and car parking worked in some areas but it wasn't a "silver bullet".

The problem was the people who chose not to pay and instead used "a convenient tree" up the road.

"And it doesn't deal with water infrastructure, so it's no use for waste water plants, and from our point of view that's just as important an aspect of tourism infrastructure."

Blenheim businessman Chris Wagner has had a lot of interest in his user-pays KiwiCamp freedom camping pod and is hopeful some local authorities will take it up next summer.

The $200,000 ablution block has an electronic payment system for showers, laundry, power, Wi-Fi, and dishing washing, with free toilets and rubbish disposal.

Wagner opened a KiwiCamp unit at his Riverlands truck-stop four months ago and about 950 people have stayed the night, spending $6 each on average.

Wagner said that more than covered operating costs, which was a big deal for councils. 

"Every time they build something they have to put that in their budget for ever."

Wagner is offering the building design for free when councils signed up for payment system managed through his KiwiCash app 

 

 

 

 

 

 

 

 

 - Stuff

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