Motel rates rises ‘disastrous’

Press, 12 July 1988, Page 1

Motel rates rises ‘disastrous’

By

KAY FORRESTER

Some Christchurch moteliers claim rates increases of up to 152 per cent are putting their businesses in peril. A group of moteliers has asked the Christchurch City Council for some form of rates relief to offset the effect of this year’s switch by the City to capital-value rating. They met Cr Ron Wright, who took their request to the council’s policy and finance committee later yesterday. The moteliers say that the switch to capital value has meant rates rises that are “nothing short of disastrous.” They cited nine motel complexes in the Bealey Avenue area. These faced total rates increases of between 74 per cent and 152 per cent Mr Doug McNulty owns the Abbey Motor Lodge, one of the nine sample motels. In October eight new suites were opened at the complex and Mr McNulty has calculated that his rates bill for 1987-88 would have been $5757 on the adjusted property valuation if the property had been rated on land value. His total rates bill for this year was $13,007, an increase over his calculation for last year of 125.9 per cent. He says that the City Council portion of the rates has risen between 200 and 300 per cent in the last few years. Other costs are rising too. “We paid a bill of just under

$4OOO the other day for electricity for a 59-day period,” he said.

“People say the motel prices are too high for the tourists and for New Zealanders, but we have to cover costs. Some motels would not be meeting their costs.” Other actual rates figures given by the moteliers were: Aotea Motel, $3503 actual rates paid in 1987-88, $BB5B rates in 1988-89, 152.8 per cent increase; Avalon Motel, $3193 (1987-88), $7245 (1988-89), 126.8 Ser cent; Avenue (and Bealey), 10,361 (1987-88), $20,229 (198889), 95.2 per cent; Akron Motel, $3365 (1987-88), $5862 (1988-89), 74.1 per cent; Southern Comfort, $3986 (1987-88), $7014 (1988-89), 75.9 per cent; Tudor Court, $3986 (1987-88), $7014 (1988-89), 75.9 per cent; Carlton Mill, $12,478 (1987-88), $22,550 (1988-89), 80.7 per cent; Abel Tasman, $5544 (1987-88), $12,316 (1988-89), 122.1 per cent.

The switch to capital value and the increase in the City’s commercial differential had resulted in this year’s “savage” increases, Mr McNulty said. Next year the revaluation (which comes into effect for the 1989-90 year) could bring bigger increases. Cr Wright suggested one form of relief might be staggering the rates increases per instalment and over a longer period than one year.