Rotorua ratepayers could face a near double-figure rates rise this year, despite their council looking to defer work to spread costs amid a tough economic climate.

One councillor described delaying work as “kicking the can down the road” and another wondered whether people would want to simply pay in one go instead – in a 14 per cent rates rise.

In the last months of 2023, Rotorua Lakes Council elected members and staff worked through 2024-34 Long-Term Plan workshops.

The first year of the plan initially forecast a 14 per cent average general rates rise this year. Elected members asked staff to reduce this.

It was 6 per cent for year two and 4 per cent for year three.

By the December 15 meeting, operating costs, capital works programme investment and future borrowing were reviewed and reduced the first-year rise to a possible 9.8 per cent, while increasing years two and three.

Year two looked to be a 9.7 per cent rise and year three 7.8 per cent.

The increases would then reduce to between 2.5 and 4.1 per cent in years four to 10.

There will be further workshopping, with public consultation expected in April and councillors approving a final plan in June.

The forecast rates rise followed last year’s controversial Annual Plan, on which the council received 2100 submissions, the second most it had ever received.

After a review of its projects and plans, the final approved average rates rise was 8.8 per cent last year. Councillors agreed to a 5.7 per cent rise in 2022.

Discussion among councillors and the public discourse on the Annual Plan hinged on what ratepayers – and the council – could afford at a time of high inflation and the cost of living.

The same issue was key to elected members’ ’s workshop discussions for the Long-Term Plan.

At the December 15 workshop, which was open to the public, councillor Gregg Brown said he thought deferring works to split the rates rise over the first three years was “kicking the can down the road”.

Councillor Don Paterson asked if the public could have a say on whether they would prefer to pay the 14 per cent in one go or to split it over three years.

Council corporate service group manager Thomas Collé said the two models could be shown through consultation.
The cost spread was mostly down to year-one expenditure being deferred, he said. Elements of its operating expenditure were “built up” over the first three years and renewal work timing was spaced out too.

Local Democracy Reporting has asked the council specifically what work might be deferred.

At the workshop, corporate planning and governance executive director Oonagh Hopkins clarified that the plan would be drafted with councillors’ preference, but could include options on which people could be consulted.

Deputy Mayor Sandra Kai Fong noted projects and funding could change in future years and so could the rates.

In a December 15 statement, Mayor Tania Tapsell said high inflation and interest rates had have driven up the cost of everything.

Rotorua Mayor Tania Tapsell says the council is "seriously limited" on what it can spend. Photo / Laura Smith.

“[This] makes up approximately 6 per cent of that total increase.

“So we’re seriously limited on what we can spend, but we are committed to delivering essential services to our community and getting Rotorua through these tough times.”

She said the council would keep looking to improve and set a target of $1 million in efficiency savings to “deliver further affordability to ratepayers”.

-LDR is local body journalism co-funded by RNZ and NZ On Air.