Rates headache for councils

THE rate in the dollar Vincent council collects from homeowners will have to go up nearly 16 per cent to keep the rates income “frozen” at last year’s level.

On average homeowners will have the same rates bill as last year, but any lucky homeowner whose rental value has bucked the downward trend will face a bigger rates bill. 

Every three years a state government valuer updates the expected annual rental value of houses, and council rates are based on taking a few cents out of each dollar, the ‘rate’. Major renovations, putting in a pool, or adding on a storey can lead to a higher valuation.

The valuer has determined that residential rent values have dropped an average of 16 per cent in Vincent, so if the council wants to bring in the same $35 million it collected last year then the cents-in-the-dollar will have to shoot up by 16 per cent to compensate.

The council’s finalising some hardship measures for those in a financial pickle due to Covid, including deferment of up to six months, and a waiver on penalty interest and charges for people on payment plans. 

All ratepayers will be able to choose to “smooth” their bills, paying either fortnightly or monthly, whereas in previous years the only options were yearly or quarterly. 

Volatility

Mayor Emma Cole said at the June 16 meeting: “While the city is committed to having a 0 per cent increase in rate yield, that volatility is there for individual ratepayers,” and they’d need to be clear with people how the rates are tallied.

The draft rate setting statement is soon to be advertised for comment for 21 days but Ms Cole says she wants thorough engagement on it, and not just the bare-minimum public notice required by law. 

The council’s taken about a $4m hit from covid-19 already and is projected to be down another $10m in the 2020-21 financial year, mainly from lost revenue from Beatty Park Leisure Centre’s closure, a drop in parking, and a few other smaller categories like refunded hire fees.

Many councils are dealing with explaining to residents how a rates yield “freeze” works while some people get lower bills and other people get higher ones, and the WA Local Government Association is soon to launch an information campaign to clear up the byzantine billing system. 

To connect with today’s homeowners WALGA is bringing in 1976 Olympic silver medalist Ric Charlesworth to front the campaign and explain how it works.

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