Tensions boil over city rates

Abigail Caspari | 23rd May 2008

Tensions ran high as Rotorua's chief executive was shouted down at a public meeting about city plans to change the way it charges rates.

Some ratepayers fear that if the council opts for a capital value rating system the city will become a "hovel" or "backwater".

They told Rotorua District Council chief executive Peter Guerin, as much at last night's meeting.

Mr Guerin got shouted down several times as he gave a presentation and answered questions on the proposed changes.

The council wants to introduce a capital value system which would take into account land, buildings, and any improvements. Under the current system rates are based only on land value.

They say it would be fairer but most of the 40 or so people at last night's meeting disagreed, with one man saying the council would "create a disaster" if it opted for capital value.

"We are facing a rates increase of $800. We are a couple of pensioners on a fixed income. Where is the equity in that? Where is the fairness?," the man said.

A woman yelled: "You have already made your mind up."

Mr Guerin repeated several times that the council had an open mind but that was questioned by some who accused him of defending capital value rating.

Mr Guerin said the capital value rating system was a proposal and urged residents to make submissions. Councillor Charles Sturt, the only councillor at the meeting, said more people supported the capital value rating system than opposed it.

But he said the council had got parts of the proposal wrong and that would be looked at. "We are not going to put something in so that we [councillors] can get the sack at the next election."

Rotorua couple John and Dee Pascoe said they were upset about having to pay at least an extra $500 a year under the proposed rating system. They live in a new subdivision on Holden Ave and have already had to pay high compliance costs to build.

"This policy is no fairer than the existing one because it is not based on the amount of services and utilities used by each household. The rationale behind this proposal is an assumption that people who live in higher value homes have a greater ability to pay more than their fair share of the city's rates than people who live in cheaper homes," Mr Pascoe said.

Several people said they were concerned a capital value rating system would discourage people to make improvements, with one woman saying Rotorua would not get better houses.

Instead the city would become a "hovel" or a "real back water".

Mr Guerin said that had not been the case in other parts of New Zealand which had capital value rating.

Dennis Walsh runs Rotorua retirement village Regency Park Estate and already pays $82,396 in rates a year, which is passed on to the 59 residents. Under the proposed rating system, he would pay an extra $22,000. Mr Walsh said there is a false perception that people who live in retirement homes had plenty of money. Submissions close on June 20.