Gunnedah Shire Council was set to make a decision regarding the Special Rate Variation (SRV) last night, with six scenarios tabled.

Four of the options would have the mining category carry a larger rate variation than business, residential and farmland ratepayers.

The decision was to determine council’s position to make an application to IPART.

It came after last week’s ordinary meeting, where the decision was deferred to allow for another workshop regarding the issue.

The motion moved by Cr Ann Luke and seconded by Cr Rob Hooke was unanimously supported.

The Director Corporate Services’ Report stated the number of scenarios were created to align closer with community feedback.

Scenario one outlined no SRV, number two was the originally proposed 38.88 per cent increase over two years, while scenario three was 42 per cent over three years, (38.88 per cent capped for residential, business and farmland) as outlined in last week’s Gunnedah Times (read story here: Recommendation for Gunnedah SRV to increase to 42% – Gunnedah Times).

Community feedback found some community members believed the mining sector should make more contributions to the rate base.

With a majority of options relying on mining to pay a higher rate, the director’s report acknowledged the category currently provides about 10 per cent of the total yield for rates.

This is about $1.6 million.

This category also contributes further funds through Voluntary Planning Agreements and other agreements. Funding had also previously come from programs such as Resources for Regions, which is no longer available for the council.

The contribution from the mining category increases for those scenarios where the SRV is not applied equally.

Scenario three would see the contribution increase to about 12 per cent and scenarios four, five and six (see below) at about 14 per cent.

The directors report acknowledged the council would need to use the estimated rate peg from the SRV if the rate peg was higher than expected for all scenarios.

There is further risk of inflation being higher than forecasted.

The officer’s recommendation was for council to “undertake any required feedback on the revised SRV proposal and associated minimum rate increases”.

Further recommendations were to formally notify IPART of council’s intention to submit an SRV application; that council’s Integrated Planning and Reporting documentation to be updated which would be presented at a future council meeting and for public exhibition and; there to be an extraordinary meeting in January for any submissions on the revised document and to endorse the SRV application.

 

 

Scenario four

New options for a proposed Special Rate Variation included scenario four, which would be a permanent 38.88 per cent cumulative SRV over three years.

This would be capped at 33.1 per cent for residential, business and farmland with mining filling the gap.

The three years would split the total SRV into 11.57 per cent for each year.

This is based on the estimated rate peg of 3.5 per cent for the 2026/27 period and 3 per cent for the 2027/28 period.

This aimed to provide some relief from the compound effect impact of the SRV for the ratepayers outside of the mining categories.

The cumulative increase to mining would be at 92 per cent over three years.

Council would however collect a lower amount of revenue if this option was approved.

The difference in the three years total would be negative $929,909.

The director’s report states, “council [would need] to identify approximately $930,000 in reduced expenditure or increased (untied) revenue (efficiency target) in the first three years to achieve the same outcome as scenario three”.

The report identified additional risks such as further cost shifting that council would potentially be unable to absorb; the possibility that no financial capacity is generated to manage growth-related infrastructure; that proposed measures to savings are not accepted by the council because of the impact on services and community and; the funding to address the backlog of infrastructure work is reduced making the conditions of the asset worse.

Scenario five

Scenario five consists of a permanent 37.67 per cent cumulative SRV over two years capped at 32.25 per cent cumulative (15 per cent per annum) for residential, business and farmland.

This aimed to spread the SRV more evenly over the two years with the mining category bridging the gap.

The total SRV for the 2025/26 financial year would be 18 per cent (4.7 per cent rate peg) and 16.67 per cent (based on an estimated 3.5 per cent rate peg).

The mining category would have a cumulative increase of 87 per cent over the two years.

The report states this scenario “would achieve a similar outcome to the SRV proposal that was consulted on once it has been implemented but the rating impacts would be higher during the two-year scenario implementation than the three-year scenario”.

Scenario six

Scenario six would be a permanent 42 per cent cumulative SRV for three years.

This would be capped at 36.8 per cent cumulative (11 per cent per annum) for residential, business and farmland while the rest would be sourced once more from mining.

This would create a similar outcome to the original proposed SRV.

The cumulative increase would be 92 per cent during three years for the mining category.

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