Rate Increases in Feilding

Manawatu Times, Volume 59, Issue 181, 31 July 1934, Page 3

Rate Increases in Feilding

.TO MEET EEVALUATION ADJUSTMENTS. Notwithstanding the very full explanation given on more than ono occasion- by the Mayor of Feilding (Mr. C. E. Taylor) as to the necessity for meeting tho loss of rato revenue consequent upon individual revaluations of properties, by increasing tho rates, thero are still ratepayers unablo to appreciate the reason for tho increases shown on current demand notices. To adjust tho inequitable situation that resulted from tho substantial loss of rato revenue following individual revaluations tho council availed itself of an amendment to tho Valuation of Land Act, 1933, which provided that rating could bo based on not less than 75 per cent, of tho original valuation. The idea of this legislation was to enable local bodies to givo somo relief to - those ratepayers who had not had any revaluation of their properties. In tho caso of Fcild-ing-no steps wero taken to moot tho fall in rato revenue until this year when it becamo unavoidable since tho revenue had fallen to a point below tho actual requirements of tho borough. Discussing tho question yesterday tho Mayor recalled that tho rate revenuo for the year 1929-30 was approximately £IB,OOO, while tho collection for the year 1933-34 was slightly over £14,000. The total reductions in unimproved valuations since 1926 amounted to £IOO,OOO and as every £IOO of unimproved valuo carried roughly £2 10s in rates, the annual loss amounted to £2500. Owing to tho depression the council mado no attempt to recoup this loss of revenuo beyond restricting its activities and actually gave ratepayers two reductions of rates, ono of 2 per cent, and another of about 7§ per cent. Tho council could havo taken steps to increase tho rates by a small sum annually, as other local bodies did in fact do, but refrained from such a step in tho hope that tho depression would lift. The borough’s original valuation, fixed in 1926, was in round figures £560,000 and ns tho result of revaluations it* now stood at approximately £460,000 —a loss of £IOO,OOO. Approximately £300,000 of this figure was unaffected by reductions, leaving £260,000 of unimproved value benefiting by reductions. In fixing the current year’s rato the council decided upon an SO per cent, valuation which the 20 per cent, reduction did not apply to those properties that had already enjoyed a reduction, unless the reduction was less than 20 per cent. With that “cut” in tho valuation tho council was then faced with levying a rate that would bo sufficient to meet tho fixed charges of the borough as well as provide for tho [ normal services, excluding, of course, capital works. Tho reduction made, said tho Mayor, would still Icavo tho majority of those ratepayers who did enjoy valuation reductions in a better position than than those whoso valua-

tions wero not interfered with sinco being fixed in 1926. Mr. Taylor went on to say that ho could not sco any possibility of reducing tho rates unless tho borough enjoyed other sources of revenuo outsido rating or obtained relief in other directions. Tho reduction in interest meant a saving of £IOOO to the borough, but this year tho council was levying £2200 less than it did in tho year 1929-30, Of tho total rato collection for tho current year, amounting to £15,500, tho following fixed charges had to bo met: —Interest and sinking fund, £10,000; Hospital Board, £1200; Fire Board, £380; subsidies, £200; a total of £11,780. This left the. council with about £4OOO, plus miscellaneous revenue, to carry on with and more than half of this amount was absorbed in ordinary maintenance charges. It was practically impossible to do any capital works out of revenue and while tho council could do with another £7OO rato revenue, ho was loathe to levy more than was actually nocessary. Tho change-over under the loan conversion schemo would this year givo the council somo easement both in interest and sinking fund payments and this was enabling tho council to do certain additional work. Tho same rate next year would not enablo tho council to do any capital work out of revenue.

Air. Taylor went on to say that the town had a very heavy debt requiring interest and sinking fund to bo paid on a sum approximating £ISO,OOO. While somo ratepayers might consider they havo a grievance, the blame, if any, could not bo attributed to tho present council, and in considering tho position thero wero at least three factors to bo taken into consideration, namely: (a) The unusual heavy debt (tho only loans added to tho debt during the past seven years were tho supplementary water loan of £IOSO and tho Aorangi bridge loan of £1500); (b) tho area of tho borough, over 2000 acres, which meant high maintenance charges for streets and footways; (c) and the fact that the borough received no rovenuo from reserves. Those factors could not be easily overcome, but responsible citizens should givo consideration to tho system of rating. Mr. Taylor did not think any one of tho three systems now on the Statute Book was ideal. The unimproved valuo system in a town of tho sizo of Feilding was a heavy burden on tho business community as well as on ratepayers with more or loss largo sections, excluding altogether the larger areas used for farming purposes. Mr. Taylor concluded by stating that both ho and tho council wore fully alive to tho position and would welcome from tho ratepayers any scheme whereby tho rato burden could bo reduced or dealt with on a moro equitable basis.