Rates could rise above State cap


YEARLY rates rises in Ocean Grove may increase after Geelong Council recently applied for an average rate rise of 3.5 per cent.
The council applied to the Essential Services Commission for the rate rise, which is one per cent above the Victorian Government’s 2.5 per cent rate cap on Victorian councils.
Mayor Darryn Lyons said his council wanted to set an average rise of 3.5 per cent for 2016/17 to reduce debt.
“When the Victorian Government first announced a rate cap we didn’t know what that cap would be, so in our 2015/16 budget process we agreed to restrict all future rate rises to 3.5 per cent,” he said.
Cr Lyons said 3.5 per cent would allow the council to deliver objectives in the City Plan 2013/17, such as capital works to cater for the growing population.
“We were also facing increased demand for more and better community services, and the rising cost of maintaining our ageing infrastructure,” Cr Lyons said.
“Those demands have not gone away,”
As part of last year’s Strategic Resource Plan, the council lowered its future rate income projections for the next four years.
It identified $1 million worth of operational savings each year by improving how the council conducted its business.
Cr Lyons said this would equate to an average increase of $50 a year across all rateable properties.
“Our aim was always to deliver a sustainable budget in 2016/17, based on a 3.5 per cent average rise in rates,” he said.
“Such an approach would have continued to reinforce our status as one of Victoria’s lower-rating councils.”
Cr Lyons said a one per cent drop in anticipated rate rises equalled a $1.6 million revenue loss for the council in 2016/17, or $6.7 million over four years.
“We’d planned to use that revenue to help reduce our current debt to a more acceptable level in 2016/17, and we still think that’s a very sensible and forward-thinking thing to do,” he said.
“Without a 3.5 per cent rate rise, there’ll be impacts down the track.”
Mayor Lyons said the financial planning changed when the Victorian Government announced the rate cap would be 2.5 per cent.
“We’ve now had to frame our 2016/17 Budget on a 2.5 per cent rate rise, and amazingly we’ve managed to do that and achieve a wafer thin surplus,” he said.
Ratepayers can read the City of Greater Geelong’s full submission to the Essential Services Commission at www.geelongaustralia.com.au