Goulburn Mulwaree Council proposes 40pc special rate variation

If ultimately endorsed it could mean residents' rates rise by $505 annually under one scenario.

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Seven weeks of consultation is beginning on a plan to apply to the Independent Pricing and Regulatory Tribunal (IPART) for the hike.

Councillors at their meeting on Tuesday, September 19 heard that "the cost of doing business" had risen significantly due to rising insurance, electricity, cyber security and state government "cost shifting" on aspects like the emergency services levy.

CEO Aaron Johansson said the state's rate peg, or the percentage by which councils could increase general rates annually, had not kept pace.

"It is well and truly below the cost of conducting business, so there is a need to talk to the community about a special rate variation (SRV) ," he said.

The council will consult the community through drop-in sessions, inviting written submissions, conventional and social media, and information on its website up until November 3. The proposal must demonstrate community support to be approved by IPART.

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The organisation is proposing two options:

The council prefers the first option (40pc) as it means "less impact on household budgets."

A report to councillors also stated that "doing nothing" was not an acceptable risk.

"The business as usual (approach) will eventually result in the council running out of cash reserves and it will have failed to keep its assets in acceptable condition," it stated.

However it also acknowledged it came at a time when ratepayers also faced cost of living pressures. A separate study has analysed the impact.

The proposed SRV has been flagged for several years but not acted upon until now. It came after an independent assessment of the council's financial situation by consultants, Morrison Low.

It found that without intervention, the council would register average operating deficits of $10.7m annually over the next 10 years. The current deficit stands at $9m in the general fund but the SRV's aim is to reach "break-even."

Consultants also found the general fund would have inadequate funds to maintain service levels and renew assets, leading to "degradation of community infrastructure." Moreover, the council would not be able to cater for population growth.

The firm has also identified 43 efficiency improvements within the organisation, some of which Mr Johansson said had already been implemented.

On Tuesday, councillors also deferred several major projects, including a new community centre and a rail trail, unless grant funded.

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Speaking before the meeting, Mayor Peter Walker said the council needed to be financially responsible and had forward planned to be so.

"We, like a lot of councils, have been forced into this situation," he said.

"Cost shifting, the rate peg, wage increases and electricity all have an impact. Where do we find the difference?"

Morrison Low found that if approved, the SRV would provide $6m annually from 2024/25 for asset renewal, such as roads, stormwater and buildings; more resources for the council's parks and sporting fields; $1.25m annually for waste management centre upgrades; and additional staff "to meet the needs of a growing community."

Cr Jason Shepherd said no one wanted to hike rates but it about keeping services into the future.

Cr Andy Wood there had been much talk about leadership that evening, during the mayoral election.

"This is about us taking leadership and responsibility to continue looking after what's important to us, the residents of Goulburn Mulwaree," he said.

Cr Bob Kirk pointed out that 70 other councils in NSW had gone through the same process, with another 20 in train.

"Hopefully we can answer everyone's questions," he said.

"It won't ease the burden but we have to face reality. If we want to keep things up to speed, we have to address it now."

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Cr Michael Prevedello said he was "aghast" by the forecast $10.7m annual deficits.

"I know our (staff) are very much on top of our financial situation.

"(But) after years of being 'fit for the future' and amid tight scrutiny of our finances in the intervening years, we suddenly find ourselves with these shocking numbers."

Cr Prevedello agreed with Cr Wood's comments at an earlier briefing session that the rate rise was now being presented as "a fait accompli" and said he was "upset in that regard".

However he voted in favour of putting the proposal out for community consultation.

A report on feedback will go to a November 21 council meeting for a decision. If an application proceeds, IPART would undertake its own community engagement from February to April, 2024, with a determination expected in April/May, 2024.

In order to be approved, the application must include long-term financial planning, community acceptance, analysis of people's capacity and willingness to pay, and productivity improvements.

All of these accompanying documents are on public exhibition on the council's website.

Drop-in sessions:

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