Draft ORC LTP has Queenstown paying up to 35 percent more in rates

by Kim Bowden - Apr 16, 2024

A proposal for how the Otago Regional Council will divvy up its rates burden leaves Queenstown ratepayers stumping up significantly more than their Dunedin counterparts.

The anomaly has been highlighted by Brian Fitzpatrick, of Remarkables Park, who has crunched the numbers to show Queenstowners are set to pay close to 35 percent more on average than Dunedinites if suggested changes proceed.

Queenstown-based regional councillor Alexia Forbes says Mr Fitzpatrick's workings are correct and while at initial glance the situation may appear unfair she is backing the council's rating policy.

She says the council's finance team tells her the perceived inequality stems from Queenstown's "huge rise in capital value" when compared to Dunedin's - and it will be similar over the hill in Wānaka.

"It's purely the rise in property value that has driven that change", and not any council policy, she says.

Regardless, she expects locals to "push back" on it.

Her view is that "if we view rates as a wealth tax, this is not unfair".

"I don't see why we would resolve it. We have agreed, long ago, to rate on value of property, and that is what's happened."

She says anyone with concerns about how this will affect "their back pocket" should try the council's online rates calculator before they start to worry too much.

"If they then have a problem with that, I'd love to hear from them."

The numbers form part of the council's next Long Term Plan, which sets the direction for council spending for the coming decade and is developed on a three-year cycle.

The plan is proposing changes to the council's current rating system in an attempt, the council says, to ensure rates are being applied fairly, using a more workable and transparent approach.

Mr Fitzpatrick says he was generally supportive of the LTP proposals for better targeting of rates, but decided to do a quick check on how average Queenstown rates would compare to average Dunedin rates under the would-be scheme.

Into a spreadsheet he put the number of ratepayers in each location and information supplied to him by council staff on the corresponding total rate takes.

"It indicates to me that, while at present the average rates for a Queenstown ratepayer are eight percent higher than for a Dunedin ratepayer, under the new proposal they would be either 19 percent or 35 percent higher (under the old and new Revenue and Financing Policies respectively).

"This raises a red flag for me and suggests that the rates settings are not fair."

Brian Fitzgerald's number crunching reveals an inequity in rates burden between Queenstown and Dunedin (Image: Supplied).

When asked to comment on the unfairness or not of the proposed rating changes, Councillor Forbes' fellow Dunstan councillors both raised issues with the Long Term Plan in its entirety.

Cromwell-based Michael Laws calls it "a dog".

"I said it at its drafting, at the council meeting where I voted against it, and I repeat, 'Bow wow wow'.

"It has no redeemable features; just another rates grab from a bloated bureaucracy in Dunedin."

Springvale farmer Gary Kelliher, who also voted against it, says he is concerned that "right through the process it was aligned towards proceeding with the staff's preference for everything".

"A few of us councillors were battling constantly for some financial sanity."

Councillor Kelliher says he commends Mr Fitzpatrick for "delving deeper" to find this "substantial unfairness", and encourages other residents and ratepayers to submit "their concerns".

Councillor Forbes spoke with Crux this morning on her way to two drop-in sessions planned for Alexandra on the proposed plan.

She says councillors need to be working to spot and draw attention to issues like that raised by Mr Fitzpatrick "rather than just slinging off".

It is her view the consultation period, underway now, is the time for that and councillors need to "show up" for that process, as do members of the public. (*Reply received from Councillor Kelliher, Thursday, April 18 advising he has been unwell and has provided councillors and the council's chief executive with an explanation for his absence from some scheduled LTP workshops.)

"To me, the whole thing is about being open and honest and taking on board the feedback and figuring out how we come up with a system that is as fair as possible. It's a strategic direction that is looking for that, and it's all in the draft financial statement."

A series of drop-in and online sessions continue this week, with councillors in attendance to discuss the Long Term Plan.

ORC’s chief executive Richard Saunders encourages any ratepayers to attend.

"Our Long Term Plan is the time for people to provide their feedback through the submission process.

"This enables councillors to consider the views of the community."

Drop in sessions

Queenstown, Wednesday, April 17, between 4pm and 7pm, Mezzanine Meeting Room, Queenstown Events Centre, Frankton
Wānaka, Thursday, April 18, between 4pm and 7pm, Lake Wānaka Centre's Armstrong Room, 89 Ardmore Street
Online, Friday, April 19, between 11am and 12pm, join here

Find a copy of the ORC's Long Term Plan consultation document here. Feedback is open until Sunday, April 28.

*Story updated 1pm with new comment from Councillor Alexa Forbes