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Hi to all Northern Suburbs Residents & Ratepayers
I hope Christmas & New Year weren't too bad - considering the fires and smoke .. tragic that many homes & businesses were lost in the Helensburgh & Stanwell Tops area .. but at least we didn't lose anyone in the Wollongong City Council area and the fires didn't get too far down the escarpment in too many places ... we have the many brave volunteers who spent day after day doing 15-16 hour stints to thank for their excellent efforts in ensuring the toll wasn't greater .. although the toll on the Dhurawal State Recreation particularly and Garrawarra area is very great, not to mention our northern city boundary, the Royal National Park... I attended a meeting as a member of the Sydney Southern Region Advisory Committee about 10 days ago where the recovery strategies for the Royal were discusses, as of course the controversial issues of hazard reduction ..... NPWS has 2 draft fire management plans, one covering Dhurawal and the other Royal/Garrawarra/Heathcote, but the third for the Illawarra Escarpment State Recreation Area is not yet at draft stage for public comment .. I have pushed for its completion as an urgent priority
In the meantime ... I'm sending some info around about the potentially huge rate rises for many Ward 1 residents in the coming financial year .. please see some comments below and in the attachments .. southern councillors are already disputing these and querying northern ratepayers and residents concerns
I am horrified that if we don't get the rating system changed that Ward 1 residents & ratepayers could be paying 30% of the city's residential rates bills and that each of the other 5 wards would only pay an average of 14% of the total each.
I have lodged a notice of motion for the first council meeting of 2002 in February to have a review of rating systems and for Rod Oxley to prepare options where Ward 1 would be charged a number of different options - 17%, 20%, 25% and 30% of the city's total residential rates bill
Whilst there has been a big focus on planning issues lately please be assured that I am fighting hard with fellow W1 ACT councillor Dave Martin to get this changed to something more equitable.
please feel free to share this email with other people who you believe might have interest or concern for the rates paid by Ward One relative to the rest of Wollongong
also - feel free to send me your comments and also send them onto Rod Oxley and consider raising them at one of the neighbourhood committee meetings
regards & hoping for a better 2002
Cr Kerrie Christian
ACT Team Councillor for Ward 1
Wollongong City Council
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MEDIA RELEASE
- LATEST LAND VALUATIONS EXPLODE NORTHERN RATES
Outrage is expected from council rates increases expected in Wollongong’s northern suburbs, especially from Thirroul to Coalcliff, based on new land valuations, if the current rating system remains unchanged, according to Ward 1 Councillor Kerrie Christian. Across the whole city, land values have gone up by about 53%, but in Ward 1 they have risen by an average of 80%, and so larger rises can be expected by most ratepayers north of Bulli Pass, according to Cr Christian’s preliminary analysis of the new valuations. These rises have been driven by Sydney pressures since the late 1980’s. Councillors are awaiting more detailed analysis from council finance staff to determine the impacts that could occur, although this is generally not provided on an individual Ward basis.
“The truth is finally out …Wollongong Council has been raising about a quarter of its residential rates from Ward 1 residents alone, that is from only 1 of its 6 wards,” stated Cr Christian, “Council has generally refused to release these figures on a ward basis, but I have been able to calculate the figures for Ward 1 in relation to the rest of the city.”
“And now with these latest valuations, this distortion is worse, and we could have nearly a third of the city’s land rates coming from Ward 1 alone,” stated a furious Cr Christian, “the other 70% would come from the other 5 wards.”
Effectively it means that about double the rates would be raised from Ward 1, compared with the average raised across each of the other 5 wards, according to an indignant Cr Christian. She asked was it fair that Ward 1 alone, with its generally poorer services, should be footing the bill for nearly 1/3 of the city’s total residential rates bill?
“It really shows the absurdity of the basis on which land rates are calculated,’ commented Cr Christian, “it assumes that property values reflect your income, even if you bought your property decades ago at a small fraction of today’s values.”
The method of calculating land rates has been an ongoing controversy for both state government and local government for decades. A Statewide Inquiry was held in the late 1980’s, and both Ward 1 ACT councillors, Kerrie Christian and Dave Martin had made submissions to the Inquiry calling for an overhaul. Ultimately there was little change made to the rating system used by Wollongong Council since that Inquiry, and with each new set of land valuations, the distortion between northern and southern suburbs has kept growing. Cr Christian indicated that she did not support flat rates, ie with all ratepayers paying exactly the same amount, but that there does need to be some method based on ability to pay, however the current system is moving further away from that for many of the older & longer term Ward 1 citizens.
Suburbs likely to be hard hit with huge increases, according to Cr Christian’s preliminary analysis, include Austinmer, Clifton, Coalcliff, Coledale, Scarborough, Wombarra and Thirroul, which all face average rises of $250-$700. Coalcliff is facing the highest average increase of $700, which could give a suburb average of $2100, compared with the city suburb average of $740 to become virtually the highest rated suburb in the city, after Yallah which has only 3 properties. While Stanwell Park which had been hard hit last time, could see a much smaller average rate increase for the suburb of about $50 this time. Elsewhere in the city, Towradgi is probably the only suburb which could see an average rate rise of about $200, above its current average of $870. About half of the city’s suburbs south of Bulli Pass could actually see average rate reductions, or only a small increase associated with annual cpi effects. Although residents in suburbs such as Avondale, Marshall Mount, West Dapto and Mt Pleasant also face huge rates bills well above the average for the city.
“I truly fear that if we don’t get a fairer system, then we will see the Secession Push for the Bring Back Bulli Shire Council develop much more momentum, if these land valuation increases are directly reflected in the next financial year’s land rates,” stated Cr Christian, “and Ward 1 residents will be demanding a fairer share of the city’s spending to fix up the area’s footpaths, roads, carparks, revamp shopping centres, and to build a new library/community centre.”
There had been some debate about the financial viability of setting up a separate council in Wollongong’s north, but with Ward 1 facing possibly paying 1/3 of the city’s residential rates, this argument could become increasingly spurious. And according to Cr Christian if Wollongong Council were to merge with Shellharbour, northern suburbs rates could be even worse, as the larger and more diverse the council area, the greater the variation in rates paid by individual ratepayers.
Wollongong Council’s Finance Department is expected to analyse possible options under the two rating calculation methods allowed by the State Government. In the past Ward 1 Councillors Kerrie Christian and Dave Martin have had little joy in persuading councillors from other wards to modify the rating system, because they feared a backlash in their own wards and so Ward 1 ratepayers have been continually sacrificed. Cr Christian has explained that she will be seeking the advice of General Manager Rod Oxley and the support of councillors from other wards for a review of the city’s rates in order to reduce this distortion, which is now at risk of accelerating the northern secession movement.
EXPLANATION
Currently land rates are directly related to land valuations, ie if your land is worth 15% more than another lot in the next street, then you also pay 15% more rates than the owner of that other lot in the next street.
So Ward 1has been paying about 26% of the city’s total residential land rates because the land valuations in Ward 1 represent 26% of the total city land values. This is at least 50% more than the average raised for each of the other 5 wards, ie averaging about 15% of the city’s rates in each of Wards 2 to 6.
If the current rating system remains unchanged, then with the new valuations, Ward 1 will begin to pay 30%, or nearly a third of the city’s total land rates. This would be about double the average rates paid by each of the other 5 wards, ie averaging about 14% of the city’s rates in each of Wards 2 to 6, and in fact a slight decrease in average rates paid for these wards.
Using a current average land rate of $744 per property, then
Currently the average rate for Ward 1 per property is $1054 Currently the average rate for Ward 2-6 properties is $673
If the current system of basing land rates directly on land valuations, and using the new valuations remained unchanged then we could see the following scenarios ..
The average rate for Ward 1 per property would be $1276 – an increase of at least $200
The average rate for Ward 2-6 properties would be $635 – a decrease of about $40
And individual suburbs in Ward 1 could experience the following impacts with the new valuations and with no change to the rating system used….
RATING SYSTEMS INFORMATION
The state government allows 2 methods of calculating land rates
- A single charge using land valuations alone – which Wollongong Council uses – known as the Ad Valorem
- Two part charge method – one part comprising a minimum rate, say between $300 and $500 and another part based on the land valuation,
Changing to the two part method would potentially bring a little more equity in so that high rise apartment complexes in North Wollongong/Wollongong (eg from priced from $399,000 and up to at least $700,000 and possibly $1 million) would pay at least the minimum rate, plus any a valuation component if appropriate. Currently they could potentially pay far less than equivalently priced single houses in Ward 1, because the rate bill for the whole site for their apartment complex is divided by the number of apartments, so that the more units that can be fitted onto the site, then the lower the rate for each unit.
But there is a need to protect really low value suburbs, eg Cringila and so it is not a good idea to have a flat rates, ie with all ratepayers paying exactly the same amount, because there does need to be some method based on ability to pay, however the current system is moving further away from that for many of the older and longer term citizens in Ward 1.
Note - When new land valuations are supplied to Councils by the NSW Valuer General these must be used for the next year’s rates. But Councils cannot use these higher valuations to increase the total rates charged across the whole of the city … so they have to juggle the percentage of rates paid by individual ratepayers.
Land valuation increases are only of value to you if you plan to sell your property, otherwise it is of no benefit and just leads to more land rates increases.
Return to Kerrie's Main ACT Web Page
Authorised - Kerrie Christian
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