Mildura Rural City Council’s manager Corporate Administration, Richard Sexton. Photo: COOPER LEA
By VINNIE RODI
COMMUNITY residents will likely be given the chance to have their say on Mildura Rural City Council’s next rating strategy in October.
Council’s manager Corporate Administration, Richard Sexton, this week confirmed that Council is already in the process of formulating its next rating strategy following the conclusion of its current five-year plan.
He said that “widespread public consultation” is key to ensuring that Council delivers “a fair rates strategy.”
“We will invite every person who wants to contribute to do so,” he said. “There will be no 28-day window, we will be making this consultation as long as it needs to be to get everyone’s views.
“At the end of the day no one likes paying rates, so everyone will have a vested interest in what this new strategy looks like.
“Our challenge is to listen to these people, and then having something ultimately in place that provides a fairness to the system based on a particular point in time, and which doesn’t prejudice a particular category in the longer-term.”
The formula currently used to calculate rates across the Mildura Local Government Area came under fire last week from both the farming community and some Mildura Councillors.
The criticism came as the forecast rates revenue to be collected from the dryland farming sector in the 2018/19 financial year increased by 22.87 percent.
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, and in the case of the dryland farming sector, the dramatic rise was linked to large increases in the CIV of a number of big farming properties.
It was an increase that led many local farmers and the Victorian Farmers Federation to stage a peaceful protest at Council’s Deakin Avenue offices last Wednesday, where they called for “a fair go on rates.”
The increase, and the subsequent feeling by local farmers that they were unfairly being forced to bear a significant rates burden, led to some Mildura Councillors stating that they “weren’t fans” of using CIV to determine rates.
“CIV has been a big talking point in recent weeks,” Mr Sexton said. “Dryland farmers, according to our data, make up half of our region’s farmers, and the irony is that in terms of valuations, they will probably be the least affected in what was mooted, incorrectly, as a 22.87 percent ‘blanket increase’ for farmers.
“Our last rating strategy, which was set for five years, ascertained that CIV was the best system for us to use, and at the moment, with the new Local Government Act plan, the recommendation is for CIV to be mandatory going forward.
“The data we used last time to form our rates strategy was quite complex, and quite detailed in providing information about who was struggling in not just a year, but in a series of years.
“With that in mind it allows you to look at individual sectors, and get an idea of what capacity to pay they might have, and forces us to factor that into the strategy.
“It’s the system by law that we are required to use, and we have a new opportunity now (through this review) to get it right.”
Mr Sexton, PICTURED, said that Council was currently inviting tenders for consultants to assist with the rating strategy review.
“This is the same process undertaken five years ago, and we will engage a consultant to do a lot of the number crunching… and give us some guidance on what other Councils are doing in this space,” he said.
“We will undertake our own benchmarking, but in this case it’s advantageous to have an external group, and one of the strengths is for them to undertake a lot of the consultation with our community just so there is no accusation of Council not listening or steering things in a certain way.
“Fundamental to the rating strategy is that we have an obligation to not only hear from farmers, but ensure there is a fair outcome for all groups. This includes the 8.5 percent of commercial properties and 80 percent of residential properties in our region.
“And while fair is an easy term to use, everyone has a different view of what fair looks like.
“We know we have to have a rating strategy in place by June 30, 2019, and with that said, the emphasis is on having this strategy completed in the next six months.
“The next rating strategy will look at CIV or alternatives, bearing in mind that the Act may not give us another option. Our plan is to look in quite complex detail at that capacity to pay, and this is where our outside consultant can help.”
Mr Sexton said that while he would “love to see a fairer system established”, he was “unsure what that is.”
“The CIV system does base itself largely on the market and where things are at,” he said. “By law re-evaluations of properties have to occur every year now, and I suspect that we won’t see dramatic shifts in the future, and I think the system will recognise when a specific category is struggling, and theoretically the (rates) burden will shift accordingly.”
Mr Sexton said that while the previous rating strategy covered a five-year period, it was yet to be determined whether the new strategy would cover the same term.
“Given the dynamics it may be prudent to look at a rates strategy that covers a three-year period,” he said. “The Local Government Act is, however, proposing rates strategies cover an elected Council term – so four years.”
Mr Sexton also confirmed that the Special Rate currently in place for Mildura’s CBD operators, which is used to fund Mildura City Heart operations etc., will also be reviewed as part of the ongoing process.