Nelson City Council is considering a range of options around lowering this year’s rates payment due to the impact from Covid-19 – including offering a zero percent rate rise.
The options will be discussed by elected members in an extraordinary meeting tomorrow, which will be held online using the video conferencing software, Zoom.
A report to council states that two rating scenarios will be prepared for council to consider on 23 April, including a 1.9 per cent overall rates increase, and a zero rates increase.
The 2020/21 draft annual plan proposed a rates rise of 3.7 per cent, however council officers now say this level “may no longer be considered prudent” or “promote the current or future interests of the community”.
The report says that lower rates could be achieved by reducing expenditure elsewhere – such as not funding and/or drawing down against the disaster recovery fund, as well as reducing the various events budgets.
Officers will also remit rates penalties on the 2019/20 fourth rates instalment under the rates remission policy using ‘compassionate grounds’ or where an agreed repayment programme is in place.
It is also being recommended that the consultation period for the 2020/21 annual plan be extended to 6 May, to enable the public to provide feedback on an appropriate rates rise.
Nelson mayor Rachel Reese says it is clear that the initial draft annual plan will not work for the social and economic situation we are in.
“I know how hard the next year will be for many in Nelson. If council is to assist in helping residents and businesses recover, we need to take the draft annual plan in a new direction.”
She says the consultation document was written in a “very different economic landscape” and the Covid-19 shutdown has changed things considerably, with many people on reduced wages or facing unemployment.
“In the few short weeks since the document was released the world has changed and we need to reconsider our plans for the next 12 months and how we as a council can help get Nelson back on track at a time when many people are facing an uncertain economic future.”
Council says freezing rates at their current level would represent an almost $3m reduction in the proposed budget over the next financial year and with impacts on revenue likely, due to the economic downturn.
Rachel says if this path is adopted by the council then tough calls would need to be made regarding priorities.
“The work council undertakes acts as a powerful stimulus for our local economy, so we need to think carefully about what changes to the rate increase will mean for Nelson. With council’s other revenue streams also impacted by the lockdown, we need some smart thinking about where and how we allocate our spending over the next year.”
She says council is well prepared to support Nelson through this crisis.
“I want to reassure you that we have kept council finances in good shape so we have the ability to support our community through this emergency. We have kept our debt level low and we have reserves to draw on.”
Councillors will also discuss how they can encourage people back into the CBD after the lockdown, in tomorrow’s meeting.
It is being recommended that inner city parking remains free of charge until the end of June, at an estimated cost of $50,000 to council.
“Officers stopped enforcement patrols in the last week of March and are unlikely to recommence until July. However, the need for patrols to manage parking such as unsafe parking, blocking driveways and in mobility car parks would continue,” the report reads.
A three-month rent holiday has already been put in place for council tenants in the hospitality and tourism sector and community groups. The potential cost of this to council is about $235,000.
Tomorrow’s meeting will be recorded and will be available to view on the council’s YouTube channel.
Up to 30 April, 14 council meetings have been put on hold or postponed, according to Nicky McDonald, group manager strategy and communications.
“Officers are currently reviewing all reports that were scheduled to be considered at the postponed meetings to ensure that those with the highest priority are considered first,” she says.
“Additionally, some reports may not be required as the impact of Covid-19 is such that decisions at this point may no longer be relevant.”