Special Rate Variation

Updated 01 June, 2017 

At the extraordinary meeting on 31 May, Council resolved:

  1. That Council adopt the addendum to the 2016/2017 Delivery Program/Operational Plan that includes a special rate variation proposal, and note the submissions received during the public exhibition period. 

  2. That Council make an application to the Independent Pricing and Regulatory Tribunal (IPART) under section 508A for a special variation to its general income being a 4 year permanent increase as follows:

    • 2017/2018 - 11% (inclusive of a 6% Environmental Levy and the rate peg)
    • 2018/2019 - 5% (inclusive of rate peg)
    • 2019/2020 - 5% (inclusive of rate peg)
    • 2020/2021 - 5% (inclusive of rate peg)

The purpose of the increase is to address underfunding of renewals on Council's road and bridge assets, to start addressing the asset backlog and support ongoing financial sustainability. The increase will also harmonise and support an environmental program across the MidCoast local government area. All current special variations would be forgone and replaced by this proposal should it proceed.

Council's special variation application to IPART can be viewed below:

IPART has advised that:

Community members wishing to make submissions may now do so directly to IPART can do so until 30 June 2017, and these submissions will be considered as part of our determination.

Full details about the proposal submitted by MidCoast Council, the assessment criteria for special variations, and how to lodge a submission can be found here

Document resources

In November 2016 a Special Rate Variation was proposed to address MidCoast roads and bridges. While the Office of Local Government announced councils that Graph.pngmerged in May 2016 are ineligible to apply for a SRV in 2017/18, a change in legislation in April 2017 has provided the opportunity for MidCoast Council to make an application.

Since the merger, we've reviewed asset data for sealed roads and bridges from the three former councils, with assistance from asset experts Morrison Low.  This highlighted an annual shortfall of $5million for funding depreciation of our roads and bridges, and a $180million backlog of works. And with roads and bridges representing 76% of the total value of our $3.3billion asset base, they remain our greatest challenge. 

Creating a sustainable path forward for our community requires additional funding dedicated to our transport network. Already, a $30million Roadcare Program has been developed, made up of ongoing savings identified as a result of the merger (which far exceed the KPMG business case scenario) along with additional merger funding through the Stronger Communities – Major Projects Fund.

But this alone is not enough to address depreciation or our significant backlog

To support the Roadcare Program we developed a special rate variation (SRV) proposal aimed at addressing our transport network.  The SRV proposal is for an increase of 5% (including the rate peg), each year over a 4 year period, along with the harmonisation of the environmental rate at 6% across the MidCoast local government area. Should the application be approved, the SRV will come into effect from 1 July 2017.

Community endorsement

During community consultation in October and November last year, you provided feedback on the proposed SRV and were quite clear in acknowledging that something needs to be done. Over 75% of people completing the survey at that time supported a SRV at the proposed level or slightly lower, demonstrating a good understanding of our current situation. Review the report that was presented to Council in November, along with the Community Engagement Strategy here(PDF, 5MB) (Report 1: Special Rate Variation Application to IPART). And you can review the results of the survey here(PDF, 26MB).

Want to know more?

Pending a resolution of Council, an application for the proposed SRV will be made based on the information distributed in October/November 2016. To find out more about the condition of our roads, the proposed SRV, and how the funds would be used to improve the MidCoast region click through and review the Survey Brochure(PDF, 2MB).

You can also see how the proposed SRV will impact on the average residential rates in your region by reviewing the information in the Addendum to 2016-17 Delivery Program and Operational Plan(PDF, 2MB).

As well as the survey, we also held a series of Community Meetings across the MidCoast region in October/November 2016, where attendees were provided with up-to-date information on how the merger is progressing, Council's long term financial position, and the proposed special rate variation. Click to review the information presented or watch the video below.

On 30 May 2017, Glenn Handford spoke to Georgia Maher of NBN News about the SRV. See the full interview below.

The video below shows Interim General Manager Glenn Handford making a presentation at a meeting held in Bulahdelah on 8 November. Glenn explains why he feels an SRV is necessary and how MidCoast Council would use the money to improve services across the region.