Waitaki District Mayor Mel Tavendale said yesterday she intended to revoke last month’s decision to set the rate increase at 22% and proposed using a $1 million dividend from Whitestone Contracting to trim the rises.
A 9% rise mooted earlier in the process was not feasible and the new rates hike would be in the ‘‘high teens’’.
Mrs Tavendale’s notice of motion to revoke the rates rise comes as police investigate death threats to one councillor, and a protest march is planned for next week.
Yesterday, a spokeswoman for Local Government Minister Simon Watts confirmed government officials had been asked to engage with the council to understand its financial decision-making, including its rates take and spending.
Protest organiser Kirsty Cashmore said a rally planned for Thursday at Takaro Park to protest the 22% rates rise would ‘‘absolutely, 100%’’ be going ahead despite the mayor’s apparent backdown.
‘‘This is nowhere near acceptable and the mayor knows it,’’ she said.
Lisa Carter, who assisted those arranging the event, said on social media that ‘‘sadly ‘high teens’ is not going to help the people who spoke out at the community meeting’’.
Mrs Tavendale said yesterday her decision to revisit the rates rise was in recognition of the pressure the community was under.
‘‘And this is us looking for any option to take some of that pressure off in response,’’ she said.
However, Mrs Tavendale said it was ‘‘not a great long-term decision by any stretch’’ as the money found to ease the pressure on ratepayers was originally earmarked to pay off debt.
‘‘We are now moving away from that.
‘‘I’m trying to balance the concerns in the community around affordability with making the right long-term financial decisions, so we’re not leaving this council in an untenable position,’’ she said.
Mrs Tavendale said there was risk in the proposal of a short-term solution that could have ‘‘future consequences’’.
‘‘To use a dividend from our CCO [council-controlled organisation] basically for the day-to-day running of the council, rather than investing in, or putting money back into the repaying of debts — it’s not the best long-term option.
She said the council needed to be able to get an annual plan in place to set budgets, and the council was in danger of not being able to do that.
‘‘I’ve reached out to the minister in this conversation because I know there are some concerns around our approach,’’ she said.
Mrs Tavendale said the decision to reduce the rates rise ‘‘may increase the operating deficit, requiring further borrowing, so that future ratepayers will pay for the services used by ratepayers today’’.
‘‘We are [between] a rock and a hard place as we are attempting to find a balance that will be acceptable to funders and central government to keep us at the table.’’
A letter from Mr Watts’ office to a concerned Waitaki resident about council spending, provided to Allied Media, said the council’s reported operating deficit was a concern that needed to be addressed.
It also said the expectation was for the council to be transparent about what was behind its present deficit and how it intended to return to a sustainable financial position.
The expectation was the council would look closely at whether all planned spending was necessary at this time, it said.
It was clear residents faced ‘‘significant cost-of-living pressure, and sharp rate increases are challenging for households’’.
‘‘Ultimately, local authorities are independently elected and accountable to their communities for their financial decisions, including rates and spending.
‘‘Intervention tools under the Local Government Act 2002 are serious steps and used in exceptional circumstances where there is a significant or persistent mismanagement or failure of governance by the local authority.
‘‘Officials have been asked to engage with the council to understand the situation and the steps being taken to address it.’’
The Waitaki District Council consulted on 19%, 27% and 45% proposed rates rises during a two-week consultation before settling on 22% on May 26.
- This story has been updated to clarify that Lisa Carter assisted with the arranging of the event, but she was not a co-organiser of it.
