Farmers' call for Ruapehu rates pruning heeded

Ruapehu Bulletin, Volume 13, Issue 589, 6 June 1995, Page 5

Farmers' call for Ruapehu rates pruning heeded

Heeding the calls for restraint from a delegation of farmers, Ruapehu District councillors voted to go back to the drawing board to try to trim the council' s 1995-1996 budget by $160,000. Following a long and circular debate on the rights and wrongs of rates incidence and the annual planning process, councillors accepted the suggestion of chief executive officer Cliff Houston, that the executive officers review the annual plan document, aiming at a maximum of three per cent increase in the general rate for northern wards. They will consider this amended plan at a special meeting tomorrow, Wednesday 7 June. Because of increased valuations in the north, farmers and other rural property owners in those wards face steep increases in their rates. This is despite an overall budget increase of just 1.1 per cent on last year's council budget. Cutting the budget to neutralise the increases in the north would have the effect of providing decreases in the general rate for southern ward rate payers. Ohakune rates up 1 4% However, because of massive increases in service charges in Ohakune, ratepayers there face a bottom-line increase of around 14 per cent (based on a property with a land value of $14,000). Councillor Ellen Gould suggested trimming the separate ward rate for the Waimarino to alleviate the problem there, but it was shown that decreasing that budget would only impact on the figure by around one per cent. "There is nothing we can do for Ohakune, it is simple as that," said mayor Garrick Workman. The increased service charges are due to spending on capital works on upgrading the sewage treatment plant, increased spending on the water treatment plant which "reflects the difficulties in resolving the operational problems of the plant". Cr Gould said it was unfortunate that the cuirent ratepayers were footing the bill for upgrades that were for the benefit of developers, who are not yet paying their full share of rates. Farmers' incomes cut Farmers told the council that their incomes had dropped 25-40 per cent in recent times, yet their rate demands had risen by any where between 40 and 75 per cent, depending on land value.

Submitter Ken Malcolm cited examples, one where a farmer's rates demands had increased from $2366 to $3352 since 1992; another whose rates had gone from $5441 to $9527; another from $8885 to $13,899. He said the council had to look at the income of farmers when setting rates. Earlier, in answer to a question from councillor Bob Peck, he said it was an unfair question to ask what percentage of income a farmer's rate demand was. "You don't ask an urban ratepayer what he earns before you decide how much to charge him," said Mr Malcolm. He said the council should look at whether the charges were fair in relation to the services provided. "You should adjust where you spend it, not just where you get it." Federated Farmers called for an increase in the Uniform Annual General Charge and decrease in the general rate, which would shift some of the rate burden from rural to urban property owners. They also called for the council to cut spending back to just the core services. Rural people were paying more than their fair share for many services such as parks and reserves, they believed. "We are paying for things we see no benefit from," said spokesman JG Walker. He said such services should be paid for through user charges and fees, or differential rates, not through a general rate.

In answer, deputy mayor Graeme Cosford said there was an assumption being made that the rural sector was subsidising urban ratepayers, but that this was not happening. "I can say quite emphatically — water, sewerage and refuse collection charges are not coming from the general rate," said Mr Houston. Mr Workman countered their claims, saying the RDC's rating policy is very close to the policy that Federated Farmers suggested. Mr Houston, asked what was so difficult about differential rating, said it was very difficult to apply a system to suit every situation. He said there was no formula to show that parks and reserves are used X per cent by urban/rural people. "Urban ratepayers say 'I don't use that (rural) road and rural ratepayers say "I don't use parks," said Mr Houston. Cr Joe Murphy said farmers "bring their kids into town to play rugby". Cr Irene Dempsey said it was not just farmers who were hard hit, that all families were affected. The council was asked where the dividend paid out by Ruapehu Construction Limited goes and Mr Houston replied that the money is used to offset the general rate demand. Mr Houston showed examples of how a $20 increase in the UAGC would see a greater increase in rates for northern urban ratepayers and a lesser increase for northern rural ratepayers. Cr Weston Kirton suggested the roading improvemerit rate could be trimmed. He said this was brought about based on an improving economy and Because that was not now the case they should consider dropping some of the projects. Cr Tony Hawkins said the roading improvement was the rural area's 'Mainstreet' programme. "If we drop that then we need to look at the Mainstreet programme and the sports co-ordinator," he said, adding that a lot of rural people wanted those projects to remain. The plan presented on Friday showed Ohakune urban ratepayers facing a 1 3- 14 per cent increase; Waimarino rural facing a 2.3 per cent decrease; Raetihi urban up 3.6 per cent and rural down 2.0 per cent; Waiouru urban up 2.3 per cent and rural down 7.3 per cent; National Park up 5.9 per cent and rural up 6.3 per cent. These figures would all be altered if the budget is cut to meet the call to reduce the rates increases in the north.