Reducing the ratepayer’s burden

The city council is proposing a bit of a rates re-structure. Photo: Supplied.

Tauranga City Council is proposing a restructuring for how it collects the rates, so the impact of the big increases planned over the next three years don’t all land on the lower end residential ratepayer as they do now.

The rates increases for domestic ratepayers over the next three years if the current system remains in effect are; 9.7 per cent next year, 8.1 per cent in 2020, and 8.6 per cent for 2021/22.

But if the proposed changes survive the public consultation process, the impact on residential ratepayers will be reduced.  The example given is a $500,000 capital value house that will pay an extra $127 a year, $2.43 a week or a 5.5 per cent increase instead of 9.7 per cent.

For the average commercial ratepayer with an $840,000 capital value property the impact is greater - an extra $1,117 a year, or $21.49 a week or 28 per cent.

The argument is the existing system is unfair.  Residential ratepayers with lower valued properties are paying a larger share of the general rates bill than any other major city in the country, while the commercial ratepayers own 17 per cent of the capital value of property in the city they only pay 14 per cent of the general rates, mainly because the uniform Annual General Charge is set at 30 per cent.

The UAGC is paid by all ratepayers as a fixed charge on each property. The 30 per cent of total rate that Tauranga City Council receives from its UAGC is the highest proportion of any metro city in the country, and it means people in lower value properties pay a larger share of the total rate, because the UAGC is divided up across property numbers and there are more cheaper properties than there are expensive ones.

The council is proposing to reduce the UAGC to 15 per cent and to introduce a differential rate – commercial properties will pay more – like they used to in Mount Maunganui Borough before it was amalgamated into the city.

The changes are expected to reduce pressure on residential ratepayers with lower value properties and ensure owners to higher capital valued properties will pay more on the city’s increasing costs.

Council staff estimate it will bring about a rates reduction for 38 per cent of ratepayers. For 40 per cent the increase will be smaller and 22 per cent will pay more, mainly the owners of higher value residential and commercial properties.

The council is offering the use of a rates calculator on its website where the impact can be assessed on individual addresses.

“That allows people to go online and actually look at the individual impact of the rating proposals on their own particular circumstances,” says chief financial officer Paul Davidson. “People can actually get that information through that calculator.”

The council is also proposing two new targeted rates, a resilience rate, which looks like a consultants’ slush fund -  and a city centre targeted rate to help pay for upgrades to the city centre streetscapes and waterfront.

The resiliency rate is explained as covering the cost of investigations to better understand the city’s resiliency issues and identify priority capital work to identify those issues.


The calculator is misleading

Posted on 28-03-2018 00:48 | By Really

Doesnt include the regional council rates and assumes property values will stay at the 2015 valuation out to 2021 which is unlikely. How can 38% of rate payers pay less if any over $500k pay more and the current average is just under $700k....yes you guessed it there will be tears all round at next revaluation time but then it will be too late they will have already implemented the new system. Doing the calculations with my estimated value rather than 2015 value and my rates would be double by 2021.

Councllors FITH?

Posted on 20-03-2018 22:49 | By MISS ADVENTURE

There is a clear case of disent in the ranks as a few are clammering to desperately distance themselves from teh huge mistake of a planned big spend. Obviously second throughts after the hand went up on auto-pilot before. Realisation that the consequences are clearly there and are bad.

@ maildrop

Posted on 18-03-2018 10:31 | By astex

Fully agree that they have shown that they are incapable of running the show for the benefits of ratepayers and must be stopped but ......... How do you stop them? how do you get a commissioner to take over? Can our local MP’s not do anything?

Rate Rebate

Posted on 18-03-2018 09:34 | By Told you

May I point out that the rate rebate has not moved with the increase in Super so therefore we get less each year.Whoever makes up this rebate table needs to lift it to make it worth while having.

Crafty cants

Posted on 17-03-2018 21:14 | By maildrop

It’s just shuffling the rigged deck. Whilst there may be merit in tweaking it, as explained, the fact remains that they are proposing massive increases to fund their stupid dreams. They are out of touch and out of control and must be stopped.


Posted on 17-03-2018 17:17 | By Told you

Council please just fund the essentials and leave the nice to have alone.

Council wages

Posted on 17-03-2018 15:48 | By MISS ADVENTURE

Are the highest of any sector for pay levels and annual pay increases. Then how do you expect rates to be realistic?

Rates are increasing heaps

Posted on 17-03-2018 15:45 | By MISS ADVENTURE

How can that be white-washed as a decrease somehow? Even if some households have no increase the burden will fall elsewhere. If commecial rates increase then the busienss will simply pass that on in the prices of everything, households will pay either way. The mind limitations and self justofications here are amazingly stupid.

@ Murray

Posted on 17-03-2018 15:37 | By MISS ADVENTURE

The ratepayer burden is increasing and only increasing. The game is all about spinning a yarn to self justify spending more somehow rather than face up to what really needs to happen which is a complete rationalisation of the entire organisation, that needs to start at the top with a clean out.

@ waiknot

Posted on 17-03-2018 14:49 | By MISS ADVENTURE

Impossible, that would mean reducing staff numbers so as to stop spending/wasting ratepayers monies.

Restructuring ???

Posted on 17-03-2018 13:26 | By waiknot

How about working on a reduction

Absolute BOLLOCKS, just PR manipulation and spin

Posted on 17-03-2018 13:21 | By Murray.Guy

NO system is perfect, or fair to all, BUT our present system and proportions is ’fairer than most’. Our city levies it’s property owners (NOTE: Not residents or people) to meet it’s operation costs on behalf of the residents. A fairer system would have resident contributions separate to commercial properties. How other local authorities proportion and gather their rates is irrelevant. NO service or commodity provider outside of governments operate on a ’property value fee/charging basis’. All all pay the same for benefits received or their availability - the value of a residential property is irrelevant. Just because an elderly retired couple on the pension find their family home of 40 years to have increased in value, why should they be potentially rated out of it, subsidizing the family of 5 in their less value home? This is wrong! There is a ’rate rebate’ available to low income owners!


Posted on 17-03-2018 13:20 | By overit

The only burden to the ratepayers are this Council.

Out of touch greedy fools

Posted on 17-03-2018 12:32 | By Captain Sensible

Out-of-touch idiots! Has anyone working or living in the real world had or expects pay rises of 9-10% for the next three years? No? Thought so.

lower valuation

Posted on 17-03-2018 11:59 | By rosscoo

So people such as myself where valuation around the $300,000 would have very small increase or know increase at all??? As article talking about the $500,000 + CV???

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