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The Upper Selwyn Huts annual fee, relating to the resident’s licence to occupy the land, is currently $582 and will jump to $977 per hut from July 1.
When the community’s new wastewater system is installed in about three years the district council predicts the licence fee will reach $4618 per hut.
Resident Graeme Young said the community is confused by the increase this year.
“We cannot understand why it is being increased this year, there is no financial basis to it.
A Selwyn District Council spokesman said the costs include a number of things.
"A bond for hut removal is proposed to ensure that at the end of the licence period, if a hut owner does not remove their hut then the district council holds cash funds which it can use to remove the hut," he said.
Other costs include trucking sewerage and chlorination of the community's water supply.
Springs Ward district councillor Debra Hasson said: “If people want an increased level of service, it has to be funded from somewhere. It is the cost of all the things that we need to manage a community."
A report presented to district councilors at a meeting last week said: “There is no need to lift the fee to $4618 from July 1 as the wastewater upgrade cost will not be incurred for two to three years but there is a need to increase the fee to start reflecting the additional costs of living at the Upper Selwyn Huts.”
Consultation on further licence fee lifts will occur via the draft 2020/2021 Annual Plan process and the district council will engage directly with each licence holder.
The fee increase could be staggered each year until 2023, the report said.
The district council predicts the wastewater upgrade will cost $3 million.
In May last year, the district council voted that the residents would have to pay in full for a wastewater scheme, when its current scheme expires in June 2020.
The district council’s decision to decline including the upgrade in the district-wide rate was due to climate change threatening the community’s long-term liveability.