PURPOSE
·
To identify and communicate to the Council the
interest and preferences of the rural based industries and rural communities of
Auckland in relation to:
-
the content of the strategies, policies, plans,
and bylaws of the Council, and
-
any matter that the Panel considers to be of
particular interest or concern to the rural based industries and rural
communities of Auckland.
·
To advise the Mayor and the Council’s Governing
Body and local boards, of the Council processes and mechanisms for engagement
with the rural based industries and communities in Auckland.
·
To deliver recommendations for accelerating the
social, economic, environmental and cultural performance of the rural part of
the Auckland Council region.
SCOPE
To provide a forum for consideration of
issues affecting the rural part of the Auckland Council area and
recommendations to Council including (but not limited to):
·
Driving economic growth
·
Food and fibre production and associated food
and beverage processing (value adding) and equine based activities
·
Research and development support
·
Environmental resource issues including
quarrying and aggregate production
·
Ecological, landscape and coastal values
·
Service delivery
·
Rural infrastructure, including transport
·
Biosecurity
·
Amenities and open space
·
Transport
·
Rating.
|
Rural Advisory
Panel
04 September
2015
|
|
ITEM TABLE OF CONTENTS PAGE
1 Apologies 5
2 Declaration of Interest 5
3 Confirmation of Minutes 5
4 Extraordinary
Business 5
5 Ballance Farm Environment Awards (12.40 – 12.45pm)
Phil
Brown, Land and Water Advisory Team Manager.
6 Auckland Council Investments Ltd (ACIL) -
ACIL's objectives for 2015/16, performance to date and objectives for
subsequent years (12.45 – 1.15pm)
Auckland Council
Investments Ltd Chief Executive, Gary Swift.
7 Review of farm/lifestyle
rates (1.15 – 1.45pm) 7
Beth Sullivan, Principal Advisor, Financial Policy.
8 Proposed Auckland Unitary
Plan update - Cultural Impact Assessments (1.45 – 2.05pm)
Mark Leggett, Team Manager, Practice & Training, Resource
Consents and Jym Clark, Planner, Unitary Plan.
9 Events in Rural Areas
(2.05 – 2.25pm)
Tim Weight, Manager Inspections, Building Control.
10 National Policy Statement
for Freshwater (2.25 – 2.40pm)
Greg Holland, Manager Natural Environment Strategy.
11 Kaipara River update (2.40
– 2.55pm)
Wolfgang Kanz, Senior Stormwater Specialist.
12 Consideration of Extraordinary
Items
An apology from
Deputy Chairperson South Alan Cole has been received.
2 Declaration of Interest
Members are
reminded of the need to be vigilant to stand aside from decision making when a
conflict arises between their role as a member and any private or other
external interest they might have.
3 Confirmation of Minutes
|
That the Rural Advisory Panel:
a)
confirm the ordinary minutes of its meeting,
held on Friday, 24 July 2015, as a true and correct
record.
|
4 Extraordinary Business
Section 46A(7)
of the Local Government Official Information and Meetings Act 1987 (as amended)
states:
“An item that is
not on the agenda for a meeting may be dealt with at that meeting if-
(a) The local authority by resolution so decides; and
(b) The presiding member explains at the meeting, at a time
when it is open to the public,-
(i) The
reason why the item is not on the agenda; and
(ii) The reason why the discussion of the item cannot be
delayed until a subsequent meeting.”
Section 46A(7A)
of the Local Government Official Information and Meetings Act 1987 (as amended)
states:
“Where an item
is not on the agenda for a meeting,-
(a) That item may be discussed at that meeting if-
(i) That item is a minor matter relating to the general
business of the local authority; and
(ii) the presiding member explains at the beginning of the meeting,
at a time when it is open to the public, that the item will be discussed at the
meeting; but
(b) no resolution, decision or recommendation may be made in
respect of that item except to refer that item to a subsequent meeting of the
local authority for further discussion.”
|
Rural Advisory
Panel
04 September
2015
|
|
Auckland Council Discussion Document:
Rating farm and lifestyle properties
As part of the development of its Annual Plan 2016/2017
council will be considering whether it wishes to consult on a proposal to
change to how rates are charged to these properties. This proposal would see small
farm/lifestyle properties pay a little more in rates, to fund a larger rate
reduction for large farm/lifestyle properties. The purpose of this engagement
is to seek the views of the rural community prior to considering whether to
proceed to formally consult on the proposal. The following discussion document
gives an overview of the issues that need to be considered for such a proposal.
At present properties classed as farm/lifestyle pay 80% of
the general rate that is charged to urban residential properties. The council
thinks this difference in rates is fair as farm/lifestyle properties have lower
access to council services compared to other types of properties.
The proposal put forward would see larger farm/lifestyle
properties (50 hectares or more in size) charged 60% of the urban residential
rate. To fund this reduction in rates, small farm/lifestyle properties (less
than 6 hectares in size) would be charged 83% of the urban residential rate.
The table below shows the effect this proposal on rates for these properties.
|
Farm/lifestyle size category:
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Small
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Medium
|
Large
|
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Size:
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Less than 6ha
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6 to 50ha
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50 ha or larger
|
|
No. of
properties
|
19,900
|
5,300
|
1,200
|
|
Proposed
Differential
(% of urban residential general rate)
|
83%
|
80%
|
60%
|
|
Average
rate change(%)
|
+2.6%
|
0%
|
-21.9%
|
|
Average
rate change ($)
|
+$73
|
$0
|
-$1,353
|
This proposal only affects the rates of small and large
farm/lifestyle properties. Rates for all other properties, including medium
sized farm/lifestyle, would remain unchanged.
What reasons are there for charging larger farm/lifestyle
less and small farm/lifestyle more?
Large properties tend to be further from council services,
and have unsealed roads. Almost all large properties are farms or forestry.
They create local jobs and reduce the need for people to commute to the city.
Smaller properties are mostly residential lifestyle. They
tend to be located closer to urban areas, and usually have sealed roads. They
also tend to be in areas with higher household incomes and are associated with
urban commuting, creating demand on transport services.
Are there any reasons why farm/lifestyle rates should
stay the same?
Large farms are run as businesses and have tax advantages
not available to residential ratepayers. They currently pay a third of the
rates charged to other rural business properties. Farms and forestry are also
associated with heavy vehicle movements which contribute significantly to cost
of maintaining local roads.
Rates already reflect differences in access to services and
the quality of roads to an extent. This is because properties that are more
remote, or have unsealed roads, have lower land values than similar properties
that are close to urban areas or have sealed roads.
What do you think? Should
small farm/lifestyle properties pay more so large farm/lifestyle properties can
pay less?
To help you decide, the following document sets out some of
the key differences between small, medium and large farm/lifestyle properties.
Differences between small,
medium and large farm/lifestyle properties at a glance
Are there differences in how
farm/lifestyle properties benefit from council services?
Property and census data suggest some differences in how small
and large properties access and create demand for council services as shown
below. (Medium sized properties fell between small and large on all measures
shown.)
Distance to
council facilities
Around 30% of rates spending is on council facilities such
as parks, libraries, pools, event centres, community halls and attractions such
as the Auckland Museum that are partially rate funded. These facilities are
primarily located in urban areas, and larger rural towns.
It is difficult to assess the distance from every
farm/lifestyle property to every type of council facility. However, we can do a
simple analysis of the distance to the nearest council library service to give
a relative indication of how close properties are to council facilities.
Properties that are within 5 km of a council library are considered close; more
than 20km from a library are remote.
|
|
|
|
|
26%
of small properties
5%
of large properties
are
close
|
|
|
|
7% of small properties
30% of large properties
are remote
|
|
|
Small properties on average get greater benefit from council
facilities than larger properties, because they tend to be closer to these
services.
Local
roads
Around 18% of rates fund local roads, mainly for maintenance
and replacement costs. (State highways and motorways are the responsibility of
NZTA and funded through fuel tax).
|
|
|
|
|
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Sealed roads cost 4x unsealed roads to maintain
|
|
|
95%
of small properties
4%
of large properties
have
sealed road access
|
|
Small properties have better roads than large ones. However,
costs to maintain and renew roads are related to the number of heavy vehicle
movements. Rural industries, particularly dairying and forestry, are generators
of heavy vehicle movements. So while small properties receive more benefits
from local roads, large properties are responsible for a larger share of the
costs of maintaining them.
Public
transport
Around 15% of rates spending is on public transport – though
the share paid by rural properties is less than for urban properties.
|
|
|
|
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40%
of small properties
are
in areas with public transport use above the rural average
|
|
|
10%
of large properties
are
in areas with public transport use above the rural average
|
|
Small properties are more likely to
be in areas with higher levels of urban commuting than large properties. Rural
industry creates local employment, reducing the need for residents to commute.
Small properties generate more commuter trips than large ones. However the
overall level of commuting is still low, with only 8% of private vehicle and 7%
public transport commuter trips originating in rural areas.
Do these differences support
charging different rates for small, medium and large farm/lifestyle properties?
Small properties tend to benefit more from council services
than large properties. This doesn’t mean that small properties should pay
higher rates however.
Not all small properties receive a higher level of benefit
than all large properties. Some large properties will be close to council
services, and have sealed roads. Some small properties are remote, and there
are almost as many small properties on unsealed roads as large ones.
The level of benefit a property receives from council
services largely depends on how close it is to urban centres, and whether it
has sealed road access. These factors are reflected in land values. On average,
land close to council facilities is worth twice as much as similar land in
remote areas. Road sealing increases land values around 20 per cent.
This means that council rates already reflect differences in
the level of services available to properties to some extent. On average, a
large farm/lifestyle property close to urban areas will pay 2.3 times the rates
per hectare than a large property in remote areas. Small properties close to
urban areas pay twice as much rates per hectare than remote ones.
Large properties still pay a greater proportion of
farm/lifestyle rates compared to small ones. They make up 5% of farm/lifestyle
properties but pay 10% of the rates collected from these properties. This is
because larger properties have higher valuations than small ones. Under the
proposal, the share of farm/lifestyle rates paid by large properties drops to
7.3%.
Do some groups of
farm/lifestyle properties find it easier to pay rates?
Nearly 70 per cent of lifestyle properties are located in
areas that recorded average household incomes above $80,000 in the 2013 census.
This compares with 40% of residential properties.
Farms and other rural industries are run as businesses. They
have tax advantages that residential properties do not. They can treat rates as
an expense and claim back GST. This sees a farm effectively paying two-thirds
the rates of a same value lifestyle property. A farm also pays one third of the
rates paid by a rural business with the same valuation. This is because
properties classed as rural business (such as shops in rural areas) are charged
a higher rates differential.
Why use size? Why not apply
differentials based on land use?
A size based differential has the advantage of being an
objective measure that is easily assessed. The proposed categories broadly
differentiate between the predominately small residential lifestyle properties
and predominately large economic rural industry properties.
The disadvantage is that the size categories are arbitrary.
There will be no difference in level of council services for two adjacent same
use properties, one 5.9 hectares and one 6.1 hectares. It also does not
differentiate between residential properties and rural industry – a small
market garden would be rated the same as small lifestyle property.
Auckland Council’s general
rate
Properties are charged a general rate based on the total
value of the property (capital value or CV). The general rate (along with the
fixed general charge) pays for those council services that are considered to
benefit the community generally.
|
Rating
category
|
General Rates differential
|
|
Urban Business
|
276%
|
|
Urban Residential
|
100%
|
|
Rural Business
|
248%
|
|
Rural Residential
|
90%
|
|
Farm/lifestyle
|
80%
|
In deciding how to charge ratepayers the council considers
whether some groups of ratepayers benefit more from council services or find it
easier to pay rates. The council applies differentials to the general rate so
some groups of ratepayers pay more, and other less. This table shows how much
groups of ratepayers pay, compared to an urban residential property.
Business properties are charged more than urban residential
ratepayers. This is because businesses place greater demand on some council
services, such as roading and stormwater. They can also treat rates as a
business expense and claim back GST, so will pay less than a residential
property charged the same amount.
Rural properties are charged less than urban properties
because they have less access to or place less demand on council services such
as public transport and stormwater. They are also further from the council’s
urban based facilities.
Rural residential properties are
charged more than farm/lifestyle properties because they are generally located
in towns and often have a higher level of council services, such as footpaths,
and stormwater services. Larger towns may have facilities like libraries and
swimming pools.
How do Auckland Council rates
for farms compare with other councils?
An Auckland farm with a capital
value of $3,000,000 and land value of $2,000,000 would pay $6,420. The same
property would pay the following rates in these council areas:
|
Far North
|
$12,350
|
Taupo
|
$9,803
|
South Wairarapa
|
$5,990
|
|
Kaipara
|
$10,210
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New Plymouth
|
$6,530
|
Tasman
|
$8,170
|
|
Waikato
|
$8,990
|
Horowhenua
|
$6,950
|
Waimate
|
$6,070
|
(Rates
include district and regional rates. Excludes water, wastewater, and
rubbish/recycling rates.)
What do you think?
Should all farm/lifestyle
properties be rated the same?
Or is it fair to charge small
farm/lifestyle properties more and large farm/lifestyle less?
Do you have any other
comments on how Auckland Council rates rural properties?
Send us your feedback:
Email:
RuralRates@aucklandcouncil.govt.nz
In writing: Rural rates
review
Auckland
Council
Private
Bag 92300
Auckland
1142
Online: ShapeAuckland.co.nz
