Rates hike proposed, but farmers not happy
Farmers will be taking a big hit if proposed changes to the way the South Waikato District Council is planning to spread rates increases go through, and they’re not happy about it.
The council is seeking to ease the burden of rising rates on urban ratepayers by taking more from the pockets of farmers.
With the low-socioeconomic community’s rates anticipated to rise on average by 7.7 per cent in
2021-22 the council wants to lower its uniform annual general charge (UAGC).
Dairy farmer Mary-Ann Mathis, who has been farming in the district for 40 years, said despite no change to her income, her rates will skyrocket.
‘‘I pay somewhere around
$80,000 in rates to the South Waikato District a year. The projected rates increase in the Draft Long Term Plan will take my rates bill to around $100,000,’’ she said.
‘‘Our income has not increased in 20 years and has had a lot of ups and downs.’’
A lower UAGC increases the overall rates of higher value properties while reducing them for lower value properties. Legislation allows councils to change the UAGC, currently set at 25 per cent, as long as it and other targeted rates don’t exceed
30 per cent of the total rates revenue.
The proposal, included in the council’s Long Term Plan Consultation Document 2021-31, seeks to reduce the UAGC to as low as 22 per cent for 2021-22 and to as low as 16 per cent by 2024.
Mathis said it was unfair to shift the burden onto farmers given that they’re the lifeblood of the district.
‘‘Until recently the council held the UAGC close to the 30 per cent limit in order to maintain some equity in who pays. Any downward change means that as a farmer we pay considerably more of the rates-take,‘‘ she said.
‘‘The farming community supports the whole community in many ways from working bees to donations. The proposed plan is an attempt to garner political support in the urban area . . . by manipulating who is paying.
‘‘I have spoken with other farmers and they are completely opposed to the council’s proposal and also frustrated that our voice is given no attention.’’
But South Waikato District Council communications manager Kerry Fabrie maintained it would be done to make it fairer on everyone.
‘‘The cumulative rate increase over the last 10 years for farms is less than the average of all properties and less than residential, lifestyle, commercial or industrial,’’ she said.
‘‘Despite this, the council accepts that rates charged to farms are a significant expense, as they are for owners of other types of properties with relatively high values.’’
Fabrie said the proposed change comes amid rapidly rising residential property prices and decreasing rural property prices. As well as the UAGC, the council’s rates revenue is also collected via general rates based on the value of a property and targeted rates.
‘‘When property values change, the total amount of money the council collects doesn’t change, just how we slice the pie changes to reflect the changes in market values,’’ she said.
Federated Farmers’ Waikato senior policy adviser Hilary Walker said, although farmers accept New Zealand’s property value rating system weighs heavily against their land-based businesses, they do expect to be treated fairly.
A series of public hearings are set to take place from May 17-19 when submissions on the issue will be read or heard. Any changes will come into effect from July.