The Council is seeking public consultation on an Annual Plan involving an average rates increase of 3.8 per cent for households.
For Tauranga homes it means a rates increase of between $67 and $98 a year depending on the property value.
A $400,000 property will have a rates increase of $71 for the 2017/18 year, a $500,000 property $76 increase $600,000, $80; $800,000, $89, and a $98 for the million dollar properties.
The council is seeking public consultation because while the proposed Annual Plan budget for 2017/18 is based on year three of the 2015-25 Long Term Plan, changes are proposed to the budgets as set out in the LTP to reflect revised economic and business conditions.
In particular, growth is now estimated at three per cent which is above levels assumed in the LTP and has implications for both capital and operational budgets.
The $154m capital programme is the biggest in the last ten years, says chief financial officer Paul Davidson.
Infrastructure pressures from the continued high levels of growth continue to put pressure on debt levels.
Following today's approval of the Plan by Council, the consultation period for the Annual Plan 2017/18 will run from 8am March 20, 2017 to 5pm April 20, 2017. Consultation on the Statement of Proposal will be held concurrently.
Included in the $154 million is half of the $4 million spread over two years to deliver a new Visitor Information Centre at Coronation Park by summer 2018/19. This will be 50 per cent funded by rates, and 50 per cent via the targeted economic development rate on commercial properties.
As the full cost to deliver an iconic building is estimated at $5m, Tourism BOP with Council support will investigate external funding options to deliver the building as per the concept design. The $4m will allow the city to build the Centre based on a more basic design, should it fail to secure external funding.
Other capital works:
Sludge pond decommissioning at Te Maunga wastewater treatment plant, $6m.
• extension of Tauranga airport terminal, $4.6m.
• structure plans for new urban growth areas, $1.6m.
• new Papamoa Community Surf Rescue Base, $950,000 contribution.
• floodlighting at Bay Oval regional cricket ground, $765,000 contribution.
• third hockey turf at Blake Park, $600,000 contribution.
Two Mainstreet organisations have asked for increases to their targeted rates above what was previously requested and budgeted through the Long Term Plan:
Mount Mainstreet is requesting a 10 per cent increase to develop their branding and meet increasing administration and design costs for events and generic advertising. This means an increase from $148,077 in 2016/17 to $162,877 in 2017/18.
Papamoa Unlimited proposes a 100 per cent increase of the targeted rate to be able to run more events and improve the marketing initiatives they undertake on behalf of local businesses. This would mean an increase from $25,000 in 2016/17 to $50,000 in 2017/18.
Council is planning within its financial strategy limits for debt and the debt to revenue ratio. However, the increase in debt to fund infrastructure earlier than in the LTP means the 2017/18 debt level and debt to revenue ratio are higher than they were in the Long Term Plan.
LTP Budget 2017/18 Annual plan proposed 2017/18
Rates $131m $134m
Other operating revenue including water rates of $19m
Subsidies and grants received for capital
Total operating revenue
Surplus/ (deficit) $5m ($1m)
Rates increase average after growth
(Increase is net of a 3% growth factor)
Deby summary net debt July 1 2017,
Net debt June 30 2018 $427m $462m
(About 65% of debt is funded through rates. The rest is funded by development contributions or user fees.)
Increase in net debt from 2016/17
Debt/revenue ratio 215 per cent 221 per cent
(Includes capital funding for NZTA renewals and rehabilitation funding as per the LTP).
Capital investment $123m $154m
(Excludes vested assets and land sales).
Development contributions $20m $24m