how-to-reduce-ratesI am writing this open letter to South Gippsland Shire Council because of the lack of informed debate on rates.
The committee established to formulate a rating strategy came up with 19 principles which were unanimously agreed by the committee members.
The choice of differential rates applied to represent those principles was not based on evidentiary modelling of the data due to time restrictions.
The modelling occurred afterwards and was done by council officers and presented to council.
In other words, the effects on the different community groups were not discussed prior to the discussion paper being considered by council.
The document was put out to public review and further changes were made to the differentials after receiving the submissions.
The changes in my view did not reflect the submissions’ views or the links to the principles within the strategy being aligned.
In other words, many of the stated principles were at odds with the effects caused from the amended differentials made by officers and supported at this stage by council.
An amendment was proposed for the recent council meeting but political manoeuvring meant it was not allowed to be presented.
The debate ensued and it is the level of debate I wish to discuss now in the remainder of this letter.
Every councillor has a duty to weigh up the argument and come to a conclusion.
My issue here is not that a particular councillor chose to vote against a motion but the reasons stated for doing so.
When a councillor chooses to ignore the evidence placed before them they do so for one of two reasons; they have a vested interest in not voting for the motion or they do not comprehend the evidence.
It is my belief that some councillors when it comes to the farm rates topic are voting against all reasonable evidence and failing to represent all their ratepayers fairly.
The basis of the rate review was to fairly and equitably share out the rate burden amongst ratepayers.
Whilst the removal of the municipal charge achieved the aim within each group, the overall issue of sharing out the rate burden between the different groups has not been achieved.
The different groups are almost paying the same as before as a group. If that was the fair and equitable outcome of the principles decided we would all be happy.
My opinion is that the evidence placed before the committee and in other forums is at odds with the status quo being a fair and equitable outcome from the review process.
For someone to argue for the status quo model, they should be able to make an argument based on evidence that supports their decision.
I do not believe they have made this argument at all and in fact the limited rationale they gave for their decision seems to be based on an ignorance of the facts in the matter.
For example, one councillor stated recently they could not agree to change the farm rate because it would mean another group would pay more.
So what this councillor was saying is that she is ignoring evidence for change because change in itself is not acceptable to her.
No evidence was suggested as to why the status quo was correct by this councillor, just that she did not want to make one group pay someone else’s rates.
Here lies another erroneous piece of reasoning.
If the farmers are shown to be paying too high a share of the rate burden then they are in fact paying someone else’s rates.
To remedy this inequitable sharing of the rate burden is not making one group pay another’s rates; it is making all groups pay what they should be paying all along.
The amendment I attempted to place in the debate last week would have raised vacant land rates and reduced farm levels – no effect on any other groups from this change.
The principle within the rate strategy and agreed to by this council is that vacant land category should pay more as an incentive to develop.
How is this principle achieved when the average rate rise for the group is five per cent and 40 per cent of the whole group are receiving a reduced rates bill because of that particular differential selected?
How did the above councillor negate this fact?
They simply stated that raising rates on vacant land would stymy development!
How is any intelligent being able to make this statement from the facts?
Land is being hoarded by speculators now (this is a commonly held belief by councillors), and we are approving new subdivisions eating up 400 acres of valuable farm land around Leongatha to make a few hundred new house lots.
The fact is, we have nearly 2000 vacant house lots now available for development but these are sat on by their owners who are choosing not to develop them at this stage.
They are not being developed now and despite the stated principle to encourage them to develop by raising their rates, the actual outcome of the rates strategy is to reduce the rates on around 40 per cent of those vacant lots, and to raise the average lot by only five per cent in value.
For a land developer on the other hand, they are being asked to pay $8500 per lot to cover infrastructure construction to service the new lots due to the developer contributions charge.
No complaint that they are made to pay that level of cash but to suggest they pay another $100 on their rates bill once the land is subdivided somehow is going to send them bankrupt or refuse to subdivide in the first place? Utter nonsense! That councillor agrees in charging them the $8500 but not the $100!
It is my view that with these lessened rates on a large number of vacant lots that the problem of hoarding will get worse, not better.
We need to have answers to the following questions from all who refuse to accept the need for change as presented above other than the spurious non-reasons they have relied on to this point.
1. How do they justify the status quo and where is their evidence?
2. Does their stated evidence actually stand up to scrutiny or is it just ignorant trivia?
3. How do they justify the farm group paying around three times that of the residential group?
4. How do they justify 12 per cent of the ratepayer base (farm group) paying 27 per cent of the total rates bill?
I will happily table their responses at a future council meeting if responses are forthcoming.
Don Hill, Tarwin Valley Ward Councillor.