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At the same time we're staying home and saving lives, @HuttCityCouncil met for the first time virtually this afternoon. We've agreed to cut the proposed 7.9% rates increase we agreed on in February, and prepare a budget based on a 3.8% rise instead http://heart.huttcity.govt.nz/services/hutt-city-council-acts-to-cut-proposed-7-9-rates-increase/
Because of #COVID19nz we know this is a tough and challenging time for people and businesses across our community. To proceed with the proposed increase and continue with business as usual is not tenable. We need to do all we can to ease the financial burden on local people.
Our decision today means we will have to push pause on some projects, but we know there are still a range of issues we need to front up to: tackling the housing crisis, modernising our rubbish and recycling system, easing congestion on our roads, rebuilding Naenae Pool...
and ensuring our basic infrastructure (especially three waters infrastructure) is up to scratch. A 3.8% increase strikes a balance – we don't want to add to financial pressures local people and businesses face, but equally we don't want to completely kick the can down the road.
Some people will be asking why we aren't pushing a zero rates increase. That's a fair question, and one I want to answer directly. First of all – we have asked our officers to prepare some information on what a zero rates rise would look like. In our meeting today...
we were advised this would require spending reductions which would result in large service cuts. My personal concern is broader than that, and is captured well in this article from @GeorgeKCampbell https://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=12323791 In the context of an economic recovery, it would be...
unhelpful for councils to jump to short-term and politically popular decisions which ultimately incentivise us to defer important projects and precisely the kind of activity that stimulates local economies and supports wider government objectives as we come out of lock-down.
I absolutely understand and support relief for residents and businesses who have been impacted by #COVID19nz. The biggest opportunity here though, isn't with local government – it's central government which has the levers to make a real difference on this front. That's why...
@HuttCityCouncil Chief Executive @jomillernz and I have written to @NanaiaMahuta and @grantrobertson1 asking them to consider a range of measures – like extending eligibility for the existing rates rebate scheme, and deferring the application of this year's property revaluations
You can read the full letter and position paper here http://iportal.huttcity.govt.nz/Record/ReadOnly?Tab=3&Uri=5579805. In it, we explain the revaluation 'issue' in a bit further detail – but for Lower Hutt it means that our most economically deprived communities would face rates increases in the order of 8-11%...
even if we were to implement a zero rates increase. This is due to soaring house prices in those communities and this being reflected in capital revaluations. That is outlined a bit better here: https://www.stuff.co.nz/national/117173792/house-prices-in-wainuiomata-up-50-per-cent-in-three-years. In this situation, wealthy suburbs would actually....
see a decrease in their rates, in some cases by as much as 4%. This demonstrates some of the challenges with rates as a blunt taxation instrument, but really shows how regressive a zero rates increase could be.
That's my 2 cents on what our Council is doing and my own thoughts on zero rates increases. I realise it's not politically popular, but my job as Mayor is to do my best by the people in our city – both now and into the future. We must strike a balance locally, while...
at the same time lobbying for more impactful changes from central government. Extending rates rebates eligibility, and addressing the revaluation issue would make a more meaningful difference for those needing rates relief. Keen to hear your thoughts!
