No 'profit' from rates: council
WITH rates notices set to hit the deck across the region, the Southern Downs Regional Council has fended off claims a looming massive rise is not needed due to new developments approved in recent years filling the coffers with more rates dollars.
Planning boss Councillor Neil Meiklejohn yesterday conceded that every new housing lot approved generated new rates once developed, but was adamant there was no “profit” in it for council as more services were required for every new dwelling constructed.
He also made it clear that while council might approve a new housing estate, not all were quick to develop and until completed generated a much lower level of “developer's rates”.
His comments come as Toowoomba ratepayers face a 5.8% increase in their budget brought down yesterday, a far cry from the 9.6% jump to hit our region.
Cr Meiklejohn said of the roughly 3000 new residential and rural residential blocks approved by the current council and the former Warwick and Stanthorpe shires since 2004, only about a third had proceeded.
“It's a really important point to understand that not all new lots that are approved necessarily proceed to completion,” Cr Meiklejohn said.
“It's not until there's a house there and people living in it that we collect full rates, and when there is it means the whole range of new services needs to be provided, like street lighting, garbage collection and water and sewerage.
“Every new lot created creates a new lot of services that council has to fund.
“And we have some large developments that have been approved but are either selling slowly or work hasn't started at all.
“There are also a range of smaller one into two and one into eight subdivisions which have likewise not proceeded.”
Cr Meiklejohn said the new cash flow generated in the local economy by new residents was the upside.
Councillors at this week's Planning Committee meeting questioned if a budget shortfall could arise due to the State Government freezing the charges councils impose for infrastructure in new developments at the end of the financial year.
Some were concerned that not allowing councils to factor CPI rises into the charges could lead to council receiving less money from developers than budgeted, but planning director Ken Harris said the figure was only ever a loose estimate.
“We simply don't know what developments are going to proceed in any given financial year, so there is always the potential for a shortfall,” Mr Harris said.
The Bligh Government earlier this year imposed a cap on council charges to developers for water and sewerage, roads and parkland of $28,000 for the typical three-bedroom home in a new housing estate.
Large councils across the state have argued the cap is too low and will force them to increase their borrowings, but for smaller councils it could mean they rake in more from the development sector.
Local Government Association of Queensland chief executive Greg Hoffman said at the time the government's changes to infrastructure charges could add an average $60 to the average rates bill in south-east Queensland and push total local government debt in Queensland past the $10 billion mark.
Rates bills are due to be received this week. If yours seems out of whack, let us know by calling chief of staff Jenna Cairney on 4660 1318.