2% Rates cap? So how to pay for that infrastructure to those new developments?
Why does the hard Right in Auckland focus solely on Rates caps and service cuts when campaigning for Auckland? They have tried in the last two elections with Auckland and lost rather soundly both times. So what does Mayoral candidate and Auckland Future’s Victoria Crone offer? More of the same the City has rejected twice and on current trajectories will reject for a third time.
See cutting the Interim Transport Levy that expires at the completion of 2017/2018 Budget then not offering what would be cut in terms of transport projects as a result of cutting the ITL is rather daft. $500 in “efficiency” savings? You could get $200m ditching ATEED out the door (as was wanted in the 2015-2025 Long Term Plan submissions) but the other $300m means cutting services and staff. Given we are short in consenting staff as is with a building boom under way and people get cranky when information is not out promptly cutting staff would seem on first impressions rather harmful to the City (you could “reset” the Auckland Transport Budgets though).
Auckland is Booming – We need to INVEST!
Given the City is under one of the largest booms it has even seen the issues for Aucklanders is housing, transport and water/wastewater. These are the issues that need to be addressed not this folly around Rates caps which would hamstring the Council in getting the core infrastructure services rolled out as the housing boom (especially under the Unitary Plan) continues to accelerate. And it is just not roads, buses, trains and pipes needed but also parks, libraries, community centres and public spaces through place making (think Manukau and the City Centre with Panuku Development Auckland). While most investment into the City is funded through CAPEX debt expenditure, in the end needs to be serviced through financing costs mostly covered by Rates, fees, selling of assets (often done when investing in a new one), Development Contributions (in new developments) and depreciation.
So Crone where is the money going to cover from to make the City function in the middle of the biggest boom we have ever seen? Cutting back office waste? That is a National translation for cutting in the end front-line services as seen in education, police and health and look how is that harming the nation as it is now.
In the end if we want to keep Rates “under control” then we need to keep property values under control given that is what Rates is based on. As blogged before the quickest way to work out which way your Rates are heading is look at the property revaluations when done every three years. If the average Auckland property value rise was say 5% depending how fast your property value when up is depending where your Rates go. If your property value went up under that 5% average congratulations you get a Rates decrease, vice versa if above 5%. Of course you could put the Uniform Annual General Charge up but that will go and annoy residents in 16 of the 21 Local Board areas as their Rates go up higher than they would with a low UAGC.
From Radio NZ:
Mayoral candidate has big plans but little detail
The National Party-aligned Auckland Future ticket, and the independent mayoral candidate Vic Crone’s joint Fiscal Responsibility Pledge, sells the message of lower rate rises and smaller council budgets.
In an interview with Ms Crone and Auckland Future’s candidate and sitting councillor Denise Krum, the pair couldn’t say much more about what the pledge will mean.
Take the 2 percent residential rates cap, how much less revenue would that bring in than the currently proposed 4 percent averages?
Ms Crone couldn’t give a figure, it “would depend”, it would “not be significant”, and “would not impede the ability to invest”.
The real answer, based on council data, is that about $20m less would flow into council coffers each year.
The pair repeatedly talked about the certainty the pledge would give residents.
They would “review it”, and “not in the first two years”. In fact the levy has only two more years to run, having been introduced as an interim measure ahead of new transport funding sources still to be discussed with the government.
What about the contentious Uniform Annual Charge?
The UAGC makes up a portion of household’s total rates set as a flat fee of $397. Some centre-right councillors want a higher flat charge, which would lower the proportion of rates determined by property value, and bump up rates for lower-value properties.
Ms Crone and Auckland Future are waiting to see what people say on the issue in consultation for this year’s annual budget. So would they be bound by the outcome of that consultation? “No.”
The other key headline pledge is a commitment over eight years to trim the council group budget by $500m, over and above a savings programme being currently driven by the council.
Where would the savings come from? “Back office,” said Ms Crone. No services would be cut. The half billion dollars would be cut from how the council runs itself.
The Fiscal Pledge is a significant step in this year’s election campaign. It strongly signals the thinking not only of a mayoral candidate, but the political ticket she is aligned with.
However voters will need and deserve more detail over the next months before deciding it’s merits.
It’s not the first fiscal policy to be released. Centre-right leaning Mark Thomas plans to offer Aucklanders the “option” of a rates freeze. This would cut council revenue by $50m plus. Other choices would be a 2 percent or 4 percent average rates rise.
No candidate has yet properly detailed how their headline figures can become reality.
The Pledge (for the lack of details it is) would essentially fail on the first hurdle given Auckland Future would need a majority on the Governing Body something the South and West would not give in a hurry. Including Councillors Casey and Clow, the South, West and Rodney would give 12 of the 21 votes at any given time (which is what we get for most things now). So Crone and Krum would subsequently struggle as a result to get a Budget through.
In the end we are looking for a Mayoral candidate and Councillors with a vision in propelling the City forward. Housing, transport, community (facilities) and a City we can identify with (so place making) is what we are looking for. Get these issues on top of and the Rates issues sorts itself out naturally through time. Focusing on Rates with no information on how to nurture a booming City is last Century’s dogma!