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Wednesday, 14 May 2008

DETAILED RATES COMPARISON: THAMES v AUCKLAND

There has been a lot of misinformation spread by rumourmongers, the hate-machine, and others who should know better, about what our rates would be if the Local Government Commission rules that we would get better local government under Thames-Coromandel than Auckland, and transfers us. All sorts of wildly imaginative figures have been put up, like scarecrows in a cucumber patch. 'Rates will be three times as high, five times as high, ten times as high.' have been flung out as if they were statements of fact.

The fact is that Waiheke's rates now average $1624 per property, and Thames-Coromandel's average $1541 (on data from Quotable Value, Auckland and Thames).

But those figures don't tell the whole story. They don't say anything about the power and autonomy that Community Boards have under the Thames-Coromandel District Council, and how deeply involved they are in setting budgets and local rates in consultation with their local communities. One effect of that system is that rates under TCDC can vary considerably from one board area to another, so if we were with it our rates would be OUR rates, not any other area's.

That point is underscored by the draft reorganisation proposal, which emphasises a financial firewall, (click here for the full text), and by that fact that the proposal also says that the total rates-take shall not rise in the first year after amalgamation, and that it shall then not rise by more than the rise in the Consumer Price Index (unless the community wants a greater increase to fund some desired project or projects).

To make the point even more clearly TCDC's rates team worked out what our rates would be if we were under them, and as if we were in each of its five existing Community Board areas (but, of course, leaving out charges for water and wastewater reticulation, which would not apply here). They used values from a real property on Waiheke, in Palm Beach, because it is close to Waiheke's averages (a capital value of $564,587, a land value of $406,775, and an improved value of $157,812). The sample Palm Beach property has a capital value of $570,000, a land value of $380,000 and an improved value of $190,000. Its rates under Auckland are $1557.

If it were magically put under the Thames Community Board's jurisdiction its rates would be $1685; under the Coromandel-Colville Community Board they would be $1417; under the Tairua/Pauanui Board they would be $1227; under the Whangamata Community Board they would be $1196; under the Mercury Bay Community Board they would be $1185.

But if the sample property happened to be in a part of Waiheke where the stormwater charge did not apply, the rates would instead be $1415, $1176, $1130, $1131 and $1066 respectively under those five boards. The stormwater decision would be made for each village and area by the Waiheke Community Board--which shows how fine-grained a board's authority is under TCDC.

You can see the range of rates, and therefore why it is impossible to say from looking at the rates in one area what they would be in another, and therefore why it is bunkum to quote rates in Thames as if they would be Waiheke's or Great Barrier's or Rakino's (or Smelly Nelly's), especially when you are including Thames's wastewater and water reticulation charges, which is what is usually done.

Obviously the rates we would have on Waiheke if we were with TCDC cannot be known to the last dollar because the local-rates portion would be decided by our Community Board after community consultation. But we do know that they would have to obey the firewall, the no-initial-increase, and the CPI-increase clauses in the reorganisation proposal. We also know from the comparison of averages and the comparison for the sample property above that they could not be three times ACC's rates, or five times, or ten times. Or even double.

But it is obvious that if the Waiheke Community Board tried to set such outrageous local rates, it would the very next day--quite rightly--be hanged, drawn and quartered in the supermarket carpark to the loud cheers of the whole island.