B&B owners have year to adjust to non-residential rates

Andrew Noone
Andrew Noone
Bed and breakfast owners in Dunedin facing a switch to higher non-residential rates will be given one year to adjust their businesses, the Dunedin City Council has indicated.

Councillors at a full council meeting yesterday decided to introduce the new policy, subject to public consultation as part of this year's 2011-12 draft annual plan.

The policy would mean B&B property owners reclassified from residential to non-residential rates by Quotable Value would be charged 50% of the higher rating category's charges in the first year, before paying the full amount the following year.

The move comes after a group of five B&B owners objected to sudden switches to non-residential rates last year, in some cases nearly tripling rates bills overnight.

QV staff determined the five were operating as commercial, rather than residential, entities, because of the number of rooms or kitchen facilities they offered.

That meant the council was required to charge the owners higher non-residential rates.

Details of the new policy were outlined in a report by council financial planner Carolyn Howard to yesterday's meeting.

Cr Andrew Noone acknowledged last year's changes had put affected B&B owners in "quite a difficult financial position", and the new policy made the change "a bit more palatable".

Ms Howard said the change would apply to those B&B owners operating with more than four bedrooms, or a commercial kitchen, reclassified as non-residential in future by QV staff.

She was not aware of any owners facing such a change this year, with those affected last year having made changes to their operations, or accepted non-residential rates, she said.

However, Cr Neil Collins predicted the change would still prompt opposition from owners during public consultation at this year's draft annual plan public hearings.

"All we have really done is say we are going to give you a wee bit longer and then hit you on the head," he said.

Deputy mayor Chris Staynes disagreed, saying the biggest concern raised by B&B owners was the sudden change in rates, when the operators' own charges were set and advertised several years in advance.

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