The purpose of this special rate variation is to improve the rate at which we renew our infrastructure and to implement an improvement program for our waterways.

1. Healthy waterways

Approximately 1.5% of the total special rate variation is being allocated to our Healthy Waterways Program. This program is focused on Council being more proactive in implementing initiatives to improve the health of our key waterbodies such as the Richmond River and its tributaries, Shaws Bay and Lake Ainsworth, as well as the Ballina Shire coastline.

Each of these waterbodies is supported by a management plan that identifies a variety of works that aim to improve the water quality and in certain instances, such as Shaws Bay and Lake Ainsworth, the recreational opportunities and amenity of the land surrounding the waterbodies.

Council’s existing rate revenue is insufficient to fund the actions in these management plans, which means we are almost totally reliant on government grants to undertake works. By generating additional rate income we are in better position to secure grants as many grant programs require a matching commitment from Council.

2. Asset renewal

We need to ensure Council is Fit for the Future. The NSW State Government established its Fit for the Future Program in 2014, where it asked all councils in NSW to identify how they would comply with a range of financial criteria to demonstrate that the council was financially sustainable.

Ballina Shire, in responding to this program, as well as identifying a range of efficiency measures, included a proposal to increase our general rate income by 2.9% each year, on top of the standard rate pegging limit, for the three year period from 2017/18 to 2019/20, with this income being a permanent increase. 

The extra rate income is to be expended on increased infrastructure renewal works for items such as road and drainage reconstruction, the replacement of playground equipment and sports ground facilities, and building maintenance. Council has an extensive asset renewal program and the additional income means that our existing infrastructure will be renewed in a timelier manner and there is less likelihood of those assets deteriorating over time.

This proposal was submitted to IPART and Council was confirmed as a Fit for the Future Council by the State Government. Information on the State Government’s Fit for the Future Program is available at the following website:  fitforthefuture.nsw.gov.au

Being Fit for the Future means that a council is adequately funding its asset renewal program and from an operating result perspective, (operating revenues less operating expenses) we should at least be achieving a break even financial result. Our long term financial plan and our asset modelling have confirmed we need this additional funding to achieve these outcomes.

Importantly, the State Government is no longer seeking to amalgamate councils which are not Fit for Future, however it is still important that Ballina Shire Council is financially sustainable in the long term. We do not want to see our core infrastructure assets deteriorate, as this then leads to increased maintenance costs and poorer levels of service to our community. 

Council is responsible for the management of over $1 billion worth of assets. These assets deteriorate at varying rates dependent on their use and construction type. If assets are not renewed in a timely manner we are faced with increased maintenance expenditure and the service level we provide to the community can also decrease. For example, we all prefer to drive on newly constructed smooth roads rather than ones full of potholes.

For the purposes of this special variation we are aiming to improve the rate at which we renew our key infrastructure classes of roads, stormwater, community buildings, open spaces, playgrounds and sports fields.  We currently have annual budgets for the renewal of these items but unfortunately the rate of renewal is proving to be insufficient to allow us to maintain or improve current standards. The additional revenue from this special rate variation will help us to maintain current standards and improve those standards over time.

Councils in NSW are subject to rate pegging. This means that the NSW Government only allows councils to increase rates by a set percentage every year. This is determined by the NSW Independent Pricing and Regulatory Tribunal (IPART) on behalf of the State Government. If a council wants to increase the total rate income by more than the set percentage it must apply to IPART. IPART then determines whether an application should be approved. IPART has advised that the standard rate peg for all councils is 2.3% for 2018/19 and 2019/20. 

IPART approved a temporary one year increase to our rate income of 4.9% in 2017/18. Because the increase is for one year only, we are now seeking to apply for a two year permanent increase; that being 9.1% in 2018/19 and 5.9% in 2019/20 (including a rate peg of 2.3%) to fund the asset renewal and healthy waterways programs. This income would be a permanent increase. 

Remember, this increase only applies to your rates and not to other charges such as water, wastewater, stormwater and waste. 

Council applies for special rate variations to deliver projects that are above and beyond normal maintenance and service programs. Special rate variations are generally invested in projects and services that would not normally go ahead without the increased revenue that Council receives from the rate increase. The below projects have been fully or partly funded by recent special rate variations:

Pools Redevelopment (applied in 2015/16 and 2016/17)

• FINA compliant 50m heated pools. Each pool will have eight 2.5m-wide lanes for competition swimming and water polo games
• 25m x 15m heated enclosable pools. Each pool can be used for swimming lessons, children’s play, lap swimming and rehabilitation
• access ramps into all pools
• wet play splash areas for children
• the Ballina pool will have a new amenities building and transparent fencing along the Richmond River enhanced landscaping at each site.

Roads ($389,600 in 2017/18)

Over $350,000 worth of road works will be brought forward as a result of the special rate variation in 2017/18. Road upgrades include Burnet Street, Fernleigh Road and Simmons Street.

• Lake Ainsworth 
• North Creek
• Chickiba Creek
• Riparian Planting Program 
• Erosion and Sediment Control Program
• Contribution to hyrdrological study - Tuckean Nature Reserve
• River Health Seminar Series
• Educational Program

For more information about each of these individual projects, view our September 2017 Community Connect (page 6). 

Over time, the current condition of our key infrastructure such as roads, community buildings and playgrounds will deteriorate to a level that will result in operational inefficiences and increased maintenance expenditure.

Eventually, there will be poorer levels of service, and a backlog of work to improve our assets. Unless we proactively increase funding now, we will be leaving future generations with significant liabilities. Ballina Shire Council has always focused resources on the careful management of our assets, and we want to ensure this continues into the future by having an adequate revenue base to fund asset renewal.

In addition, the Healthy Waterways Program will not proceed as Council will not be in a position to fund any of the planned initiatives.

Council's in NSW are subject to rate pegging. This means the NSW Government only allows councils to increase rates by a set percentage every year. This is determined by the NSW Independent Pricing and Regulatory Tribunal (IPART) on behalf of the State Government.

If a Council wants to increase the total rate income by more than the set percentage it must apply to IPART. IPART then determines whether an application should be approved. IPART has advised that the standard rate peg for all NSW councils is 2.3% for 2018/19 and 2019/20.