Hastings facing one of highest rises
Council could hit $700m debt
Hastings District Council is proposing a huge — but unsurprising — 25 per cent rates increase from July as it looks to fund “unprecedented” recovery costs from Cyclone Gabrielle.
Council is nearing $400 million in debt and anticipates it will reach $700m in debt by 2030, according to the council’s new draft Long Term Plan (LTP).
The draft LTP was released for public feedback yesterday.
The council is also proposing potentially closing Frimley Pool to help save money.
“The cost of recovery from Cyclone Gabrielle has had to be incorporated in council budgets and, despite receiving some funding from central Government, the net cost to Hastings district ratepayers is unprecedented,” council papers stated.
Hastings district was the hardest hit of any region in Hawke’s Bay during Cyclone Gabrielle last February in terms of damage.
The LTP includes proposals for a new cyclone recovery targeted rate, which would be included in ratepayers’ annual rates bill.
“The cyclone recovery programme is forecast to cost an average of $17 million per year over 16 years,” the LTP stated. “If we spread this over all properties, the average cost would be $620 per property a year.”
Hastings District Council chief executive Nigel Bickle said it had been a difficult process.
“This has been the most challenging
Long Term Plan we have probably ever had to deal with.”
For an average homeowner, who pays about $3000 in Hastings rates per year, they are now facing a rates bill of $3750 during the next council year (July 2024 to June 2025).
If the 25 per cent rates rise is
adopted in the coming months it will be among the highest in the country.
Other councils around the country with high proposed rates rises include West Coast Regional Council (27 per cent rise), Environment Canterbury (24.2 per cent rise), and Napier City Council (23.7 per cent rise).
According to data collected by Local Government NZ, the average rates rise across the country is about 15 per cent, for the up-coming year.
Other Hawke’s Bay councils to unveil their proposed rates increases include Central Hawke’s Bay District Council (20 percent rise) and Hawke’s
Bay Regional Council (19.6 percent rise).
Some councils around the country, such as Wairoa, are yet to release their proposed rates rises.
On top of ongoing cyclone recovery costs — including Category 3 house buyouts — Hastings District Council is juggling higher debt repayments, inflation and higher insurance costs.
The council does have caps on how much it can borrow from the Local Government Funding Agency, in terms of debt, to stop it from getting into financial trouble.
The council is within its borrowing limits despite nearing $400 million of debt.
Councillor Simon Nixon said the debt had grown significantly in recent years and he was “starting to worry” council would not have enough borrowing headroom if another big event were to happen.