Kempsey Shire Council has been given permission to raise rates by 24 per cent over the next two years by the NSW Government's independent pricing regulator.
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The Independent Pricing and Regulatory Tribunal (IPART) has announced a partial approval of council's application for a special rate variation, approving only the first two years of the application for a 42 per cent increase over three years.
Council originally proposed a 7.9 per cent increase in property rates for the first year, followed by 15 per cent increases over the following two years, however, it has only been approved for the 24 per cent over two years.
IPART states councillors can choose when they implement the approved increase in rates income, including deferring any increases for up to 10 years, and also how they set rates across the rating categories.
Kempsey council has announced councillors will make a final decision on setting the 2024-25 rates at the June ordinary council meeting.
In the meantime, council's draft operating plan and budget for 2024-25 is on public exhibition with members of the community able to submit feedback until Sunday, May 19.
The rate variation approved for the 2024-25 financial year is 3.2 per cent above the already approved rate peg increase of 4.7 per cent.
Kempsey Shire Mayor, Leo Hauville, says the partial approval supports the need to generate increased income to secure financial sustainability.
"Council will have to remain focused on reducing costs and ensuring the right services are being delivered in the most efficient way," Cr Hauville said.
"The long term financial plan, currently on public exhibition, includes a range of actions in the financial sustainability program. These now become even more critical to deliver."
Council's director corporate and commercial, Stephen Mitchell said the IPART determination is a fair representation of the challenges faced by council and the ratepayers.
"We are committed to making financial sustainability a focus of the councillor induction and planning sessions following the September 2024 local government elections," Mr Mitchell said.
"There is still a significant forecast deficit to manage, and over the next year we will look for savings by reviewing operations of Kempsey Airport, conducting service level reviews, and aligning the most efficient staffing levels with those services."
IPART released its decisions on nine New South Wales council applications for special variations to increase their general income by more than the rate peg.
Out of the nine, the tribunal approved five applications, approved a lower increase for three and declined one.
"These decisions are based on our assessment against the Office of Local Government criteria, taking into account the issues raised by stakeholders during our submission period," IPART chair Carmel Donnelly said.
A total of 75 submissions were sent to IPART by Kempsey Shire community members on the SRV.
"The councils with approved increases are encouraged to consult with the community to decide how best to implement the allowed increase."
IPART states councils are required to report to the community about how their additional revenues are spent, and councils must spend the approved additional income on the specific purposes outlined in each of their applications.
