Riccarton Borough rates to rise 33 per cent

Press, 14 July 1987, Page 9

Riccarton Borough rates to rise 33 per cent

A 33 per cent rate increase was approved by the Riccarton Borough Council yesterday. In a breakdown of the rates, the Riccarton Borough rate, which includes the general, refuse and water rates, has risen 39 per cent. The ad hoc rate, which includes the Catchment, Drainage and Transport Board rates, has increased 25 per cent. Compared with last year, the rates for residential properties will increase between 8 per cent and 40 per cent, with rates for an average property in Rattray Street increasing 18 per cent, from $496 to $586. In a summary of 198687 financial results, the Town Clerk, Mr John

Skinner, reported that net expenditure from rates was 3 per cent above estimates because of additional costs in administration, town planning and streetworks, but this was offset by a higher collection of rate arrears and an unbudgeted distribution from the vehicle testing station. Mr Skinner said that in spite of the rise in rates this year, Riccarton Borough’s average residential rate remained the lowest in the metropolitan area. He cited an average Christchurch City rate as $730, with Heathcote at $BB6 and Waimairi at $667. Comparisons were also made between other metropolitan districts in

the country, which showed that out of 37 authorities, Riccarton had the eleventh lowest average residential rate, the seventh lowest average electricity account, and the fifth lowest combined charge. Planned expenditure for this year is $12,229,851, compared with $8,889,000 spent last year. Loans totalling $2,343,000 are proposed to be raised during 1987-88 for road improvements, town hall improvements and electricity capital works. Rating method Together with the 33 per cent rate increase, the council introduced a

change from land-value rating to capital-value rating and differential rating. The chairman of the finance committee, Mr Brian Harman, said land value rating for the borough rate was previously appropriate because it encouraged the development of vacant land, but this benefit was no longer relevant. “Over all, capital-value rating tends to be fairer because the rates paid relate directly to the total market value of a property. “Also, the rates base expands as new development takes place, so the council revenue automatically rises to help fund the increase in demands made on its resources.”

Mr Hannan said the rapid growth of the borough’s commercial sector had placed an extra burden on resources, with heavy costs in the areas of town planning and traffic management. He said that because of the 1986 revaluation, rate levels for individual properties would vary widely this year. Bringing in capital value rating and the revaluation would also cause shifts in the incidence of rating, which would marginally increase the share of total costs paid by residential property owners. Mr Skinner said a majority of councils in New Zealand used capitalvalue rating.