QLDC asks banks to help with $7 million in unpaid rates

The amount of overdue rates owed to the Queenstown Lakes District Council has increased to more than $7 million from $5.7 million just a year ago. Now the council is asking ratepayers' banks to recover the money from household mortgages or personal bank accounts. 

A total of 644 households (totalling $2.1 million in unpaid rates) are more than a year overdue.

The non-payment problem has become so serious that the QLDC has contacted the personal banks of 594 properties looking to get their rates money through a "bank mortgage call".

This process allows the council to "recover as a debt from the first mortgage of a rating unit" under Section 62 of the Local Government (rating) Act of 2002.

A QLDC spokesperson told Crux: "There may also be differences in how each bank extracts payment funds from the customer. For instance, some may take it from the customer’s current account, some may add it to their mortgage."

The rapid increase in rates arrears comes at a time when the QLDC rates have risen dramatically. In the current year the average increase has been 14.2 percent but many properties have seen an actual increase much higher than that average.

First-hand experience - Crux managing editor Peter Newport

It turns out I had a growing unpaid rates debt with the QLDC - the extent of it completely unknown to me until recently.

In my case I discovered that the QLDC had approached my bank (ASB) without telling me of the issue or sending a rates reminder.

Upon making an enquiry, a member of the council's rates team told me (as a ratepayer - not a journalist) that they "could see where the frustration and confusion has come from". 

"Our invoices are based around the Local Government (Rating) Act requirements, however I agree that they can be confusing. In terms of our debt collection processes, we do not currently send reminder letters as we have system limitations around this."

However, when these candid comments were put to the council for official comment for this story, the QLDC communications team has claimed the council rates invoices are easy to understand. "QLDC rates invoices clearly show the amount brought forward (i.e. unpaid) from the previous period and also the total amount owing."

Do you have a problem with your QLDC rates? Please contact [email protected]