LAKE Macquarie’s economy will receive an estimated $2.5 billion injection with the approval last night of a massive rate rise to be spread across seven years.
Councillors voted unanimously in favour of what will be the largest rate rise on record in NSW. They approved council staff’s recommendation for a residential rate rise of almost 70 per cent over seven years, with businesses facing a 90 per cent increase over the same period.
The decision will cost residents an extra $93 a year, on average, and businesses will pay an additional $421 a year, on average.
Councillors said the decision was made to cover a $15 million annual shortfall and in response to community demand for improved infrastructure and services.
They said it was needed because of increased costs, deteriorating infrastructure and a lack of money from state and federal governments.
Some ratepayers believe wasted money, mismanagement and largesse played a part in the problem.
Councillors asked for further improvements in efficiency but they believed the council was run well.
The decision will be submitted to the Independent Pricing and Regulatory Tribunal for determination.
Councillors vote in record Lake rate rise
Mayor Greg Piper bristled at the rate rise being described as the largest in NSW history.
“The council is showing great leadership and courage,” he said.
Council figures show the rises will allow a $659 million capital investment in infrastructure over seven years including $326 million in new projects and $333 million to replace ageing assets.
Cr Daniel Wallace said it would amount to a $2.5 billion renewal program for the city, with an economic multiplier effect of four-to-one. A further $35 million would be spent on maintenance.
The council will increase debt from $58 million in 2011-12 to $185 million by 2018-19.
Councillors chose “option three”, the largest rate rise of three options put to the community for comment.
The council said 50 per cent of 3257 residents who responded to surveys supported option three.
After the vote, council general manager Brian Bell hugged corporate services director Wayne Jack, who managed the rate rise plan.
Cr Laurie Coghlan said the city would now be on par with similar councils for rate income.
Cr Kay Fraser said some pensioners and families would struggle to afford the rise, but several councillors said data showed most residents could afford it.
Cr Anthony Birt said he was an economic conservative who believed in lower rates and user pays but “expectations have risen and our income has not”.
Cr Jodie Harrison said: “If we don’t do this now, it will be much worse in seven years”.
Cr Paul Scarfe said the unanimous decision meant Greens, Liberals, Labor and independents supported the rate rise.