Councillors considered the draft annual plan report written by interim chief executive Stephen Parry at a full council meeting yesterday.
In the report, Mr Parry outlined eight areas where costs had increased, including insurance, maintenance of council buildings, depreciation and roading.
Initially, after all council budgets were submitted to corporate support general manager Lornae Straith, the rates increase would have been 40% but Ms Straith "worked assiduously to whittle the rates increase down to 31.7%", Mr Parry said.
Further cost cuts were found to end up with the present proposed increase of 21.4%.
Speaking to his report, Mr Parry said this budget was the "most challenging" he had faced in his time at the council.
"These rates increases proposed are abnormal and a reflection on, I think, a deeper-lying problem which is the sustainability of funding at local government."
The public would be able to make submissions on the draft annual plan, Mr Parry said.
Gore District Mayor Ben Bell said the council had come through some tough times since the election.
"I think the toughest thing is definitely passing on a rate increase that we all know, as ratepayers, that the community simply can’t afford and that’s really hard as we have to keep this council going."
During the discussion Cr Stewart MacDonell said while the rate increase might be necessary this year, the council needed to look at other ways to lower its debt.
"We may get away without too much blood on the carpet with a 21.4[% rates rise] this year but if we go back for a second round we’ll be in trouble."
One possible source of revenue was to sell some of the 95 buildings the council owned in the town, he said.
Submissions open on Monday and close on May 17.
