The Southland District Council has investigated a lower rates rise than forecast for next year, but it could mean a higher increase in the future.
A draft annual plan was presented to the council this week which recommended a 2.65% rise — lower than the 3.27% forecast in the long-term plan.
Finance manager Sheree Marrah said the reduction was achieved by using road and forestry reserves as a "one-off" approach.
“By using reserves to offset rates, the council is not covering all its operational costs from the current year and therefore this will need to be paid from revenue in future years, thus increasing rates requirements.”
Cr Karyn Owen was disappointed the report did not include a zero rates increase option .
Mayor Gary Tong said the council still needed to focus on economic and regional development.
Cr Rob Scott said the council should understand what rate increases for the future might actually be.
He suggested staff look at office costs, budgeted at $900,000, as council staff were working from home.
Chief executive Steve Ruru said this would be reviewed during the long-term plan process.
The report was approved. Crs Owen and Scott voted against it.
The council’s annual plan must be adopted by June 30 ahead of the new financial year starting on July 1.
