By VINNIE RODI
MILDURA Rural City Council is on track to release a draft of its next five-year rating strategy for public comment in February.
Council’s manager Corporate Administration, Richard Sexton, PICTURED, this week confirmed that external consultants, ‘Mach2 Consulting’, had completed public consultations, and had submitted a summary and discussion paper to Council.
“That discussion paper is currently before Councillors to consider,” he said. “Once Councillors have their input, a final draft rating strategy will be presented to Councillors for endorsement, and once endorsed a statutory 28-day public submission period will be held.
“At best a draft rating strategy will go before Councillors for endorsement in February.”
Mr Sexton said that it was looking likely the formula to calculate rates across the municipality will remain the same as in previous years, however, he indicated that all options were currently being discussed and considered.
Over the past five years, the total amount each property owner pays in rates is determined by multiplying the rate in the dollar by the Capital Improved Value (CIV) of their property.
It’s a system that came under fire last year, after the region’s farming sector was hit with a 22.87 percent increase in the total amount of rates revenue collected as part of the 2018/19 Council budget.
“We’re still looking at everything from how we collect our rate debt to how much empathy we can show and what we can do in terms of hardship provisions,” Mr Sexton said. “All of these things, however, touch on a bigger problem, and one that we’re not confident we can simply resolve.
“The irony at this point is we still need, in round terms, $60million in rates to operate. Our commitment is there to ensure everyone has the opportunity to consider the draft strategy and speak to it, with ratepayers to have the option to speak to Council either individually or as a group in addition to any written feedback.”
Mr Sexton also expressed criticism of the current Victorian rating system, saying Council was working hard to make the system fair for local ratepayers.
“I know many political aspirants talked about it (rates) at the last State election, and fundamentally the system we work in isn’t serving us well, and it isn’t a long-term solution,” he said.
“Short of additional State or Federal funding, there is a gap between what we pay out in taxes to those bodies and what we get back, and that gap manifests in a rate. Now there might be rate capping in place, but ultimately we still have to be high to deliver the services we think we need to provide.”
Mr Sexton said Council was also committed to working with new Member for Mildura Ali Cupper to keep the rates issue “in front of the State Government.”
“We know it’s a long-term game, and no one is going to hand over buckets of money,” he said. “The whole rates system doesn’t lend itself to a rural, small population-type Council.
“The system as we currently have it across Victoria lends itself to metro areas where you have large population bases sharing the load.”
Mr Sexton also discussed the consultation period undertaken by Mach2 Consulting, saying the vast amount of feedback had come from the farming sector, which had been “most impacted from the most recent rating year.”
“We’re conscious at the same time that we haven’t heard much from our commercial and our residential ratepayers,” he said. “We don’t want to underestimate their needs, so we’re hoping the draft will flesh out more of their input.
“It’s fair to say that there is strong empathy for the plight of farming, and at the same time recognising that it’s not just a simple category being a farmer.
“There’s not only dryland, there’s also variation in farming more generally, whether that’s multi-national type entities, whether it’s the local traditional farmer…. the bigger enterprises, there’s quite a rich variation there.
“We also don’t want to underestimate any particular group’s capacity to pay, because we’ve come to the realisation that we are a fairly high-rating Council, and while we don’t deny that, we know that we have to be.”
The 2019-24 rating strategy will be the first since significant changes were introduced in 2014, including a farming differential rate set at 95 percent of the residential rate, a Business differential rate set at 120 percent of the residential rate, a City Heart special rate and the introduction of a $100 Municipal Charge.
Mr Sexton said all of these additions are still being looked at as part of the new rating strategy.
“There’s lots of schools of thought, for example the Municipal Charge, is that a regressive tax? I don’t think anyone disputes that, but most Council’s have one,” he said. “It’s not an extra amount, it’s a minimum rate, and I can certainly see the arguments for and against, and so does Council, especially that it could be disadvantaging to lower socio-economic groups.”