Kawerau District Council has managed to cut almost six per cent off its projected double-figure rates' rise – without cutting services.

With over $1.5 million more required to maintain current levels of service in the Kawerau district in the coming financial year, the town was facing an overall rates increase of almost 14 per cent.

However reductions in the amount set aside for depreciation has helped reduce this to 8.2 per cent.

All ratepayers will still be looking at a $100 increase in their uniform annual charge.

The minimum rate paid by all ratepayers, before capital value of the property is taken into consideration, will now be $850.

The council adopted a consultation document for its 2023-24 Annual Plan to go out to all ratepayers at its meeting on Wednesday.

Finance and corporate services manager Lee-anne Butler says initial budget estimates for the coming financial year shows an increase in costs to maintain current levels of service to the tune of $1.66 million. This equated to a 13.9 per cent overall rates increase.

Part of the increase in budget is due to council-owned assets increasing in value by $18.8 million in the recent revaluation carried out as part of the 2021-22 annual report process.

Rather than being good news for ratepayers, the increased value of assets meant a rise of $758,850 in the amount the council must fund depreciation on those assets. Of this, $453,000 is to be covered by rates.

The council currently saves $1.33 million a year by not fully funding depreciation.

In 1998, it decided not to fully fund the depreciation for several buildings as they were not likely to replace these with buildings of equivalent value.

These include the Town Hall, Concert Chamber, Ron Hardie Recreation Centre, Library and Museum, Museum Archives building and the district council offices.

It also does not fully fund depreciation on roads that are subject to Waka Kotahi New Zealand Transport Agency subsidies.

It is now proposing to increase that amount by $583,000 to $1.91 million as a 'prudent method of lowering the rates requirement” without lowering the level of service.

Other reasons for the increase in council costs are the $550,000 in surpluses from the Central Cove sales being used in the current financial year's budget, inflation, increased costs of waste disposal and the of $120,000 cost of having the upcoming long-term plan audited.

The overall rates' increase includes a 9.8 percent increase in general rates and a 10 per cent increase in the targeted rate for refuse collection, which is currently $191 or $243, depending on what size bin each property has.

These increases will be offset by lower targeted rates for water. Residential properties in Kawerau pay a flat rate for water supply, which will drop by 18.9 per cent, and waste water, which will drop by 19.2 per cent.

Many councils in New Zealand are looking at double-figure rates' rises this year and drastic cuts to levels of service.

Whakatāne District Council is increasing its loan funding to keep its overall rates' increase to 6.92 per cent and Ōpōtiki District Council is facing an almost 14 per cent rise.

Councillor Carolyn Ion says she feels the council needs to do the very best it can for the community.

'We've got to work harder and we've got to work smarter. We're hearing councils around New Zealand are cutting services. The knives are coming out. We're not looking at cutting services.”

Mayor Faylene Tunui says the council needs to feel reassured that it's collecting only what it needs.

'We are not unnecessarily charging rates to all the households, all the industries, all the non-residential ratepayers, who all have their challenges, as do our residential ratepayers.”

The council voted unanimously to adopt the draft plan for consultation.

Kawerau residents will have one month to make submissions on the plan and the council will hear and consider these in early June, ahead of adopting the plan on June 28.

-Public Interest Journalism funded through NZ On Air.