Rates may rise two percent

SOUTH Gippsland ratepayers may receive a $100,000 gift from council.
That’s how much council is forgoing in rate increases by planning to keep the next rate increase below the State Government’s cap of 2.25 percent.
South Gippsland Shire Council’s proposed budget for 2018-19 forecasts a rate rise of two percent.
“We are sending a nice message to the community,” council’s acting manager finance Stuart Smith said.
He said council could have increased rates to the limit permitted by the cap, resulting in an extra $100,000 income, but could afford not to.
“Over the last 15 years we have stuck to our Long Term Financial Plan and that has enabled us to be in a strong financial position,” he said.
Mayor Cr Lorraine Brunt said even by holding the rate rise at two percent, council would still achieve a surplus. Council predicts an underlying surplus of $3.33 million, which is the result minus capital funding sources.
Council plans to raise $42.15 million from rates in 2018-19. Rates increased by 2.5 percent in 2017-18.
Council will deliberate the proposed budget tomorrow (Wednesday) and it includes a $21.39 million capital works program featuring the expansion of the Great Southern Rail Trail from Welshpool to Hedley, building a footpath along Jumbunna Road to Korumburra Secondary College, a new bridge on Bena-Kongwak Road, $3.8 million refurbishment of Mirboo North pool, and drainage and kerb and channelling in Loch’s Main Street.
While the capital works expenditure is up $3.2 million on 2017-18, council expects much of the cost to be funded by grants. Council will spend $6 million less on major works compared to this financial year.
Council has allocated $1 million towards extending the rail trail 8.3km from Welshpool to Hedley next financial year rather than the extension from Leongatha to Korumburra, as council believes it may obtain grants for half of the project from the Latrobe Valley Authority and Regional Development Victoria towards the works. Council plans to allocate $3 million towards the Korumburra extension in 2019-20.
Other capital works include $778,000 to cap three cells at Koonwarra landfill and a further $352,000 for a leachate evaporation system; $364,000 set aside towards the Korumburra Community Hub if the preferred site of the railway land is approved; and $1.3m for road seal rehabilitation works.
Total caravan parks works for 2018-19 are: $435,000 for a toilet block at Waratah Bay, $376,000 for a toilet block at Long Jetty Caravan Park, $60,000 to replace cabins at Long Jetty Caravan Park, $68,000 for an office at Long Jetty, $99,000 for a communal area at Yanakie Caravan Park and $169,000 for an electrical upgrade at Yanakie, for a total of $1.307 million.
Staff costs have risen by $1 million to $26 million, with council now employing 265.53 fulltime equivalent staff. This financial year, council added an arts and events officer.
“We are still providing the same services so unless you cut out services, you can’t cut out staff,” Mr Smith said.
Council borrowed $4 million in 2013-14 to fund a $4.59 million unfunded superannuation obligation and has converted the borrowings into a five year bond due to be repaid in July 2019.
As at June 30, 2019, council will have $3.35 million in outstanding borrowings, along with $3.35 million in a cash loan reserve to pay out the bond. That reserve has been buoyed by council putting money aside over the years.
Some rates bills will vary due to property valuations now being conducted annually, as required by the valuer-general. Council will still conduct valuations in-house until 2022 when it becomes mandatory that valuations be undertaken by the valuer-general. Council believes in-house valuations are cheaper for ratepayers.

Future plan: from left, South Gippsland Shire Council’s communications officer Danielle Thompson, mayor Cr Lorraine Brunt and acting manager finance Stuart Smith with council’s proposed budget for 2018-19.

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Posted by Tayla Kershaw on Mar 20 2018. Filed under Featured, News. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry