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Double-digit rate rise signalled

Double-digit rate rise signalled
A significant 29% funding increase for roading is being proposed in the first three years of the 2024-35 long-term-plan for the overall subsidised maintenance, operations, and renewals.

Mid Canterbury residents are facing a possible 11.5% rate increase - and while councillors think it's probably too high, they aren't sure where they can make further cuts.

Ashburton District councillors landed at the 11.5% figure after two and half days of poring over the budgets for the draft long-term plan, having started with a figure of 13.75%.

“A big chunk of the increase is roading,” chief executive Hamish Riach said.

“Roading is the single biggest cost factor”

Over the next three years, the roading budget is proposed to increase by 29% ($10.7m).

The council won’t know until around May if NZ Transport Agency Waka Kotahi will match its proposed roading programme, and subsidise 51% of the $10.7m.

Debt servicing costs from capital works, including three waters, over the last few years is another large factor, Riach said.

Three waters, drinking, waste and storm water, work will continue to impact the budgets over the next 10 years as the council works to reach mandatory compliance standards.

The final details will be prepared, including how the 11.5% average will impact on various areas, for the next budget workshop on January 17.

There is plenty of water to go under the bridge before the LTP – which includes a new bridge and a water main under it – is locked in at the end of June.

The Ashburton District Council spent three days going through the long-term plan budgets.

Councillor Carolyn Cameron said she felt the signalled rise is too high.

“I think 11.5% is too much.”

Deputy Mayor Liz McMillan said councillors probably all agreed it was too high, but would struggle to find ways of cutting it back.

Mayor Neil Brown said it will be up to the ratepayers to decide if the 11.5% increase is too high.

“Let the community tell us when we consult what they don’t want.

“Where do they want us to cut.”

The councillors had been working on a rough formula that 1% equated to $470,000.

Utilising dividends and interest earned from investments, along with reserves, to the tune of $6,447,987 for 2024/25 is effectively subsiding rates by 13.7%.

Of the 11.5% increase signalled, roading, with an additional $1.8m from the council, is around 3% and the compliance works on drinking water (an extra $1.67m) and wastewater ($950,000) combine for around 5%.

Once the draft LTP is produced early next year, it will go out for public consultation in March.