The Independent Pricing and Regulatory Tribunal (IPART) sets the amount Councils in NSW can increase rates by each year, which is called the rate peg. A Special Rate Variation is a request by Council to IPART to increase rates by more than the rate peg amount.

NSW councils can apply to IPART for a Special Rate Variation to the rate peg which will be considered against the guidelines set by the NSW Office of Local Government.

There is a widening gap between Tamworth Regional Council’s income level and the growing costs of providing current services and infrastructure.

Up to now, Council has supported a steadily growing population and maintained its infrastructure and services within the scope of its revenue growth in line with the rate peg increases set by the State Government. However, in recent years this has become increasingly difficult.

Rate revenue represents around one-third of council’s total revenue. In recent years the rate peg increase has not been sufficient for Council to deal with high inflationary pressures and cost shifting from State and Federal Government eg. Emergency Services Levy.

We have made appropriate use of savings to sustain us in recent years through our worst drought on record, extreme bushfires, the COVID pandemic, repeated major storm events and subsequent flooding.

This current financial year we have forecast a modest cash surplus but over the next few years it is projected our cash reserves will be in decline.

permanent Special Rate Variation of 36.3 per cent over two years. The proposal comprises a variation of 13.6 per cent from July 1, 2024-25 (including the actual rate peg of 4.9 per cent) and 12.5 per cent in 2025-26 (including the forecasted rate peg of 2.5 per cent).

* 36.3% calculated based on interest compounding over the 2 years. Think about a starting rate of $100. In year 1, I would pay $118.50 [$100 + ($100 x 18.5%)] in rates, and in year 2 I would be $136.28 in rates [$118.50 + ($118.50 x 15%)]. It is the same as taking the original $100 and increasing it by 36.3%.

The impact on an individual’s rates will be different depending on the unimproved land value of their property.

To find out what the increase will be for you, use our online rate calculator.

The SRV applies to the general rate charge. This is the base rate and rateable value on your rates notice. It does not apply to garbage or general waste, sewerage, stormwater, or water charges.

The Office of Local Government considers Tamworth Regional Council as a Group 4 council alongside Albury, Dubbo, Broken Hill, Armidale, Byron, Ballina and Eurobodalla. When Tamworth Regional Council rates are compared with others in Group 4, the amount paid by our residential ratepayers is currently ‘significantly below’ the group average. To learn more go to www.yourcouncil.nsw.gov.au

Council is guided by what the community wants when setting its priorities. The proposed Special Rate Variation will enable Council to:

• Invest more on its transport and road network across the region to meet community expectation and address the adverse impact of climate change on their quality. Two thirds of the proposed SRV will be allocated to our roads and transport network.
• Invest adequately in its infrastructure to maintain assets at fit for purpose conditions.
• Deliver the actions in adopted sports and recreation strategies and masterplans for key sites such as Victoria Park, Bicentennial Park and Chaffey Park.
• Invest in Council’s aquatics facilities.
• Undertake key transport upgrades such as Jewry Street, Moore Creek Road and in the CBD.
• Return key assets back to a satisfactory condition, particularly in stormwater and buildings (such as Town Hall, Community Centre and TRECC).
• Build a new animal rehoming pound.
• Deliver key approved projects such as the Skywalk and remediation of Ray Walsh House.

Tamworth Regional Council has been able to hold off on seeking a Special Rate Variation until now through our track record of strong financial management. Many nearby local government areas have already been granted a sizeable Special Rate Variation this current financial year.

We have already implemented a range of efficiency and productivity improvements to create operational savings, however an increase to our rate income is an option we must look at if we want to continue to deliver the services and projects our community has told us they want and need.

Council has made every effort to avoid asking our ratepayers to sustain an increase in rates but we are at a point where we must seriously consider it or reassess our current priorities.

Council regularly reviews its operations and actively identifies and takes actions to ensure that it is containing costs and finds efficiency gains, so that it is able to provide value for money to the community. We have already identified $7.9 million in annual savings or additional revenue and $3.2 million in one-off savings through implementing 189 initiatives over the last few years.

Council has a plan to implement a further 24 actions in the coming years providing further annual net savings and benefits of $1.6 million and one-off net savings and benefits of $2.2million. These improvements have been included in its updated Our Resourcing Plan including Long Term Financial Plan 2023-2034. Our Organisation Sustainability Improvement Plan also highlights a range of cost savings, revenue and productivity gains.

Yes, Council knows the community is doing it tough and did not jump to request an increase last year when 17 other NSW Councils were faced with the same financial challenges and decided to act immediately. Compared to other council requests for a Special Rate Variation ours is modest.

Unfortunately, the money is required to keep infrastructure adequately maintained so we can continue to deliver the same level of service that the Community expects.

For those that are struggling, Council has a “Hardship Policy” and is in the process of revising it to ensure that the most vulnerable in our community has the means and the support they need in times that are challenging.

Our Councillors agreed to increase the rebate for ratepayers who receive an Australian Government pension/income support payment. The rebate will be $50 in addition to the State Government Funded existing rebate in the first year if a Special Rate Variation is approved and enacted, and $100 in the second year of the Special Variation and continue ongoing.

This has been formalised in our Ratepayers Pensioner Policy, which outlines the additional options for support and flexibility for eligible pensioners with regards to property debt incurred for their principal place of living.

The other document that has been on public exhibition is the Ratepayers Hardship Policy, which is to ensure equity to all ratepayers whilst assisting those experiencing financial hardship, and to ensure property debt is reduced consistently over time.

The intention is to encourage those facing hardship to reach out to our staff so they can try and find flexibility to accommodate individual circumstances.

The current rate increase request is focussed on ensuring financial sustainability for Council whilst recognising the capacity of the community to pay in these times of high inflationary pressure.

For this reason, the following growth projects have been excluded pending more favourable economic conditions, possible financial support from other levels of government and appropriate community consultation:

These projects remain important to Council and to supporting growth in the Tamworth region. Given the current increasing costs of living, Council has made the decision to focus on seeking only the sufficient revenue needed to renew current assets and remaining financially sustainable. Council is still looking at completing its studies on the best options to procure and fund the above projects with the least financial impact on the wider community.

There is already a need for Council to address pedestrian safety on the road to the Lookout. Now we have a grant of $14 million that will not only address that safety concern but also add to our regional attractions and offerings.

Council’s modest contribution of $3 million is necessary to secure that grant as it is customary of grantors to request the grant recipient (i.e. council) to make some contribution.

Under The Local Government Act 1993, Council is required to apply sound financial management principles which include ensuring balancing expenditure with revenue.

Council is seeking feedback and submissions on the potential for an SRV. But the Council will need to weight the feedback received against its obligations under the Local Government Act.

If Council could not increase its rates revenue through an SRV, it would not be able to adequately fund its asset renewal and maintenance, particularly in roads. It would also not be able to deliver the projects identified to address key areas of asset backlog, particularly in sports and recreation (including pools), stormwater, roads and buildings.

As this investment in infrastructure is critical to supporting a growing population, Council’s Blueprint 100 strategy and commitments to the community under the Community Strategic Plan are jeopardised if a Special Variation is not approved.

Until the end of October this year we will be actively providing you with a range of information to raise your awareness and understanding about the need for a Special Rate Variation.

This information will be provided through Council’s website and social media channels, traditional media advertising (print, radio and television), community information sessions and online webinars. There will also be a printed newsletter sent to all ratepayers and available for download from Council’s website for all local residents.

Once the community consultation period concludes, Council will review the feedback received.

At a November Ordinary Meeting Councillors will decide whether to proceed with a special variation application for 2024-25 with the application to be lodged in or before February 2024.

IPART will ask for feedback from the community until 18 March 2024

IPART will announce the outcome of the application in May or June next year with any approved increase to apply to rates from July 2024.

Council encourages residents and ratepayers who wish to provide feedback to do so through any of the following:

• By submitting your comments online below
• Letter – General Manager, PO Box 555 Tamworth NSW 2340
• Email – trc@tamworth.nsw.gov.au
• Phone – Customer service 02 6767 5555

IPART has set the rate peg for the 2024-25 financial year using our new rate peg methodology. The core rate peg for the 2024-25 financial year for each council (i.e. before applying the population factor) ranges from 4.5% to 5.5%.

IPART’s rate peg takes into account the Base Cost Change (BCC) by council group (metropolitan, regional and rural), in addition to a population factor based on each council’s population growth and an Emergency Services Levy (ESL) factor to reflect annual changes in each council’s ESL contributions that differ from the changes to the council’s BCC.

The rate pegs for the 2024-25 financial year also include a catch-up adjustment for past changes in the superannuation guarantee rate and a council-specific ESL adjustment for some councils. The purpose of the council-specific ESL adjustment is to reflect the increase in the ESL in the years when increases were not captured by the rate peg because they were subsidised by the NSW Government.

The population factor in the rate peg maintains the amount of rates collected per person in areas that have a growing population. The final rate peg for the 2024-25 financial year for each council (i.e. after applying the population factor) ranges from 4.5% to 8.2%.

For more information on the rate peg for the 2024-25 financial year, please see our Information Paper, which includes the rate peg for each council, and our Media Release.