Wagga Wagga City Council acknowledges the traditional custodians of the land, the Wiradjuri/Wiradyuri people, and pays respect to Elders past, present and future and extends our respect to all First Nations Peoples in Wagga Wagga.
We recognise and respect their cultural heritage, beliefs and continuing connection with the land and rivers. We also recognise the resilience, strength and pride of the Wiradjuri/ Wiradyuri and First Nations communities.
Front cover image: Jim Elphick Tennis Centre
Executive summary
As part of the Integrated Planning and Reporting (IP&R) Guidelines issued by the Office of Local Government (OLG) in 2010, all Councils in NSW are required to prepare a suite of documents to assist with planning and reporting within the IP&R framework.
The main components of this framework include the Community Strategic Plan, Resourcing Strategy, Delivery Program, Operational Plan and Annual Report as shown in figure 1.
The Long Term Financial Plan (LTFP) is an essential element of the resourcing strategy which recognises Wagga Wagga City Council’s (Council’s) current and future financial capacity to continue delivering services, facilities and infrastructure to the community as part of the objectives and commitments outlined in the Delivery Program and Operational Plan while undertaking the initiatives and projects that will contribute towards the strategic aspirations in the Community Strategic Plan.
The Resourcing Strategy focuses on long term strategies in three key areas:
• Financial Planning - addresses the financial resources that impact on Council’s ability to fund its services and capital works whilst remaining financially sustainable.
• Workforce Planning - ensures that Council has the resourcing capacity with the required skills and experience to deliver current services and operational needs for the community now and in the future.
• Asset Management Planning - defines the services, how they are provided and what funds are required to provide these services over the 10 year planning period.
These interrelated plans consider the capacity of Council to deliver its obligations within the Community Strategic Plan that fall under the responsibility of Council in terms of time, money, assets and people.
Wagga Wagga City Council’s Long Term Financial Plan is a 10 year financial planning document with an emphasis on long-term financial sustainability. Financial sustainability is one of the key issues facing local government, due to several contributing factors, including growing demands for community services and facilities and their ongoing operational costs, constrained revenue growth and ageing infrastructure.
The Long Term Financial Plan is formulated using a number of estimates and assumptions, to project the future revenue and expenditure required of Council to deliver those services, projects and programs expected by the community for the next ten years. In doing so, it addresses the issues that impact on Council’s ability to fund its services and capital works whilst remaining financially sustainable.
Council has reviewed the previous Long Term Financial Plan and adjustments have been made as part of this process. The proposed budget for 2025/26 is a balanced budget with the majority of the years for the LTFP projecting deficits (excluding 2027/28 and 2030/31 which are showing surpluses) for the 10-year rolling plan.
The projected deficit positions for the plan highlight the significant challenges that Council has been facing with revenue restrictions and rising costs, which has resulted in the requirement to increase the use of borrowings to fund projects with further loan repayments included over the life of the plan.
The Long Term Financial Plan is reviewed during the year and changes adopted via the Monthly Financial Performance Report that is presented to Council. This report monitors and assesses Council’s performance against budget each month. If there are any changes to the budget as a result of this process they are reported to Council and adjusted in the Long Term Financial Plan.
Long Term Financial Plan Objectives
The objectives of Wagga Wagga City Council’s Long Term Financial Plan are:
• to provide a forecast financial position over 10 years to ensure that Council remains financially sustainable
• to support the implementation of the Community Strategic Plan (CSP)
• to identify and highlight future challenges, issues and financial trends to ensure that they are considered and addressed
• to ensure compliance with legislative requirements of Integrated Planning and Reporting (IP&R) contained in the Local Government Act 1993 (the Act), the Local Government (General) Regulation 2021 (the Regulation) and the guidelines produced by the NSW Office of Local Government (OLG).
Other state plans and strategies
Other Council strategies and plans, including:
Local Strategic Planning Statement
All Abilities Inclusion Action Plan
Cultural Plan
Environmental Strategies
Community Engagement Strategy
Long Term Financial Plan Asset Management Plan Workforce Resourcing Strategy Delivery Program
Operational Plan Resourcing strategies
Figure 1: Wagga Wagga City Council's IP&R framework.
Financial strategy
Wagga Wagga City Council is committed to operating in a financially sustainable framework, to ensure that its community and other stakeholders can rely upon the ongoing provision of a diverse range of high-quality community services, facilities and infrastructure.
Council plans to maintain its financial position and performance, to ensure resilience and a capacity to adapt and respond to arising community needs in a measured and equitable manner. The six key principles employed in Council’s financial planning process are:
Financial sustainability
• Provide facilities, services and infrastructure that the community needs
• Maintain cash and investments
• Maintain liquidity to manage any unexpected shocks
• Balanced budget in the 1st year
Prudent financial investment
• Manage Council’s reserves
• Manage cash flow
• Monitor investment performance
Effective utilisation of funding sources
• Utilise grant funding where available
• Utilise reserve funding if applicable
• Utilise borrowings if necessary
Maintain tight control over expenditure
• Review of service delivery
• Continuous improvement
• Determine real ongoing savings
• ‘Can do’ attitude and approach
Aim for above benchmark results against KPI’s
• Improve financial position against key performance measures
Narrow the infrastructure funding gap
• Increase maintenance/renewal budgets from savings and efficiency gains
• Maintain an Infrastructure reserve and allocate funds when savings are realised
• Assess asset conditions and what constitutes a ‘satisfactory condition’
• Apply for state and federal grant funding for roads and other assets
• Investigate potential funding options such as a Special Rate Variation (SRV)
Financial Strategy 1
Financial sustainability
Financial Sustainability is the ability for Council to generate sufficient funds to provide the level of services and infrastructure that the community needs and expects over the medium to longer term. This includes being able to manage likely developments and unexpected financial shocks in the future. Council has faced significant challenges in maintaining a stable position in previous Long Term Financial Plans.
In many cases external factors exert significant pressure on Council’s long term sustainability. Some of the external factors include:
• Council’s regulatory environment that defines the scope and boundaries by which the Council must conduct its business
• Continual lower than anticipated allowable rate peg increases which reduces Council’s ability to align rating revenues with the increased cost of providing services
• Cost shifting of services or functions by Federal and State government to Local Government without corresponding funding, with examples such as the contributions to the NSW Fire Brigade; inadequate funding for public libraries; and the cost of regulation of companion animals
• Growth and urban development increasing Wagga’s population and therefore increasing the demands on existing infrastructure, facilities and services provided
• The financial impact as a result of the COVID-19 pandemic has added additional pressure for Council to remain financially sustainable
Each of the above factors result in an income gap with costs increasing at a greater rate than revenue. Council has again conducted a comprehensive annual review of all budgets for the 2025/26 Long Term Financial Plan, which demonstrates its commitment to remaining financially sustainable and reducing the income gap.
Maintain unrestricted cash and investments
Unrestricted cash and investments represent a measure of liquidity/net financial position. Council’s unrestricted cash and investments allows for day to day liquidity and ensures the organisation is able to manage any budget shocks during the year, which may include unforeseen expenditure overruns, an emergency event or income shortfalls.
Wagga Wagga City Council, as a prudent financial manager, has set a minimum level of $3.5M which should be maintained. This ensures it retains an appropriate level of liquidity on an ongoing basis and is able to control/ determine the value of its annual budget surplus or deficit.
With budgeted deficits for 7 years of the Long Term Financial Plan, the continued challenge is maintaining this minimum level of Unrestricted Cash into the future.
Balanced budgets
With each annual budget process Council aims at a minimum, to achieve a balanced budget which allows the organisation to maintain a positive unrestricted cash and investments balance. This position gives flexibility to maintain liquidity and fund any unforeseen expenditures or discretionary funding deficits.
The Base Case budget detailed in this Long Term Financial Plan indicates Council will maintain a balanced budget for 2025/26. Arriving at this balanced position for Year 1 was a complex and challenging task. These ongoing adjustments will continue to have a substantial impact on the delivery of projects and services, which will require Council to be highly innovative and efficient in delivering the Operational Plan and Delivery Program items.
The budget for 2025/26 is balanced with the majority of the years for the LTFP projecting deficits (excluding 2027/28 and 2030/31 which are showing surpluses) for the 10-year rolling plan as shown in Table 1.
These figures will again be reviewed as part of the 2026/27 Long Term Financial Plan to ensure that a balance budget for at least the initial financial year is achieved.
Wagga Wagga City Council will continue to carefully manage its cash reserves and investments to ensure that appropriate financial reserves are available to meet Council’s liabilities and commitments, along with managing cash flow demands to ensure responsible financial management control. While externally restricted reserves will be maintained in accordance with legislative requirements, a number of internally restricted reserves are used to ensure that funds are available to directly support the initiatives and projects as outlined in the Community Strategic Plan, Delivery Program and Operational Plan.
Into the future, there will continue to be more scrutiny placed on the use of these internally restricted reserves with the potential diversion of funds to other areas in response to Council’s ongoing financial pressures. Externally restricted reserves will also be considered, where appropriate, ensuring that approvals are sought where required.
Council will closely monitor and report its investment performance as part of its ongoing monthly and quarterly budget review requirements which demonstrates its financial health and sustainability in the Financial Performance report presented to Council monthly.
Financial Strategy 3
Effective utilisation of funding sources to fund capital works
The Long Term Capital Works Program identifies the various funding sources proposed for each capital project. Council will utilise grant funding where available, internal reserves where applicable, and borrowings where it is deemed necessary and intergenerational equity is considered more appropriate.
Council has previously utilised borrowings through the Low Cost Loans Initiative (LCLI) program that was announced by NSW Planning & Environment to assist councils with the cost of new infrastructure that
enables new housing supply. This initiative provided a 50% interest subsidy on projects that met the criteria under the program. Council was successful in its application to Rounds 1 and 2 of the program for relevant capital works projects.
Council has also been successful in recent years in attracting a number of state and federal government funded grants to be directed towards various major capital works projects.
Financial Strategy 4
Maintain tight control over expenditure and staff numbers, while still maintaining best value services, facilities and infrastructure
Wagga Wagga City Council is committed to the ongoing review of its service delivery as part of a continuous improvement process. Specifically, Council is seeking to identify if the services it delivers are relevant and necessary to the community as well as appropriate in the current environment. The continual improvement process includes determining if the services meet the needs and expectations of the community as set out in the Community Strategic Plan, Delivery Program and Operational Plan.
The continuous improvement process aims to achieve the following objectives:
• Assist in informing Councillors, the community and Council’s staff on what, how and why it delivers the current list of services. It endeavours to answer questions surrounding the need to provide the service, service delivery alternatives such as contracting resources, outsourcing some activities, joint delivery with other councils, what can be provided at what cost and if any efficiencies can be found.
• Finding savings that are real, sustainable, and are able to be entrenched into future budgets. This strategic approach to budget management is to identify lasting solutions for the provision of services in contrast to common short-term budget management strategies which include delaying the implementation of projects onto an unfunded list or by making budget cuts that may not align with the Community Strategic Plan.
• Continue moving the organisational culture to one of a “can do attitude and approach”. By creating an expectation of better service delivery, Council is empowering its staff with the tools and processes to make better decisions.
• Embedding the realisation of continuous improvement. In providing an environment where continuous improvement to service delivery is expected, staff are encouraged and supported to identify opportunities so that the services that Wagga Wagga City Council provides are the best value for its community.
A number of other initiatives have been implemented to assist in identifying budget efficiencies, which include:
• Review of fees and charges that are deemed cost recovery to ensure a closer alignment with actual costs
• Energy savings and carbon reduction initiatives
• E-Business and online service initiatives
• Improved information management systems and technology
• Competitive procurement processes
• Review of capital project delivery, procedures and outcomes
• Utilisation of allowable reserves for internal loans in preference to external borrowings where possible
• Refinancing of high interest loan borrowings where possible and where it is cost effective taking into account exit costs
• Zero Base Budgeting (funding to be allocated based on program efficiency and necessity, rather than budget history)
Financial Strategy 5
Maintain/move towards above benchmark results against key performance indicators
Council will monitor and work towards improving its financial position against key performance measures and benchmarks as set by the Office of Local Government (OLG).
Reportable ratio results are also included in Council’s annual financial statements.
Refer to Appendix 4 of this document for relevant Key Performance Indicators.
Financial Strategy 6
Narrow the infrastructure funding gap
Wagga Wagga City Council’s Asset Management Plans have identified a shortfall in current expenditure on the maintenance and renewal of infrastructure assets. This represents a risk to the organisation that a significant number of assets may fail due to inadequate maintenance. If this issue is not addressed, it will have an adverse impact on Council’s financial position in the medium and longer term. Council is attempting to address this issue wherever possible by:
• Increasing recurrent levels of maintenance and renewal budgets by identifying budget savings and efficiency gains from all parts of the organisation
• Maintaining a reserve for infrastructure replacement and allocating additional funds towards this reserve as a priority when budget improvements are realised
• Reassessing asset conditions and what constitutes a “satisfactory” condition
• Applying for state and federal grant funding for roads and other assets to direct towards maintenance or renewal projects
• Investigating potential funding options such as a Special Rate Variation (SRV)
Economic Overview
Annual change in Estimated Resident Population (ERP)
Population and Demographics
The population estimate for Wagga Wagga City as of the 30th June 2024 is 68,951. Population growth slowed in 2024 to an estimated 0.4% per annum, roughly half the growth rate seen during the Covid-19 era. The Estimated Resident Population (ERP) is the Australian Bureau of Statistics' official 2024 population figure for all Local Government Areas (LGAs) - but is subject to review after the next Census release.
In 2021, Wagga Wagga LGA had a higher proportion of children (under 18) and a lower proportion of persons aged 60 or older, than Regional NSW. The largest age group reflected in the population was the 35-49 year age group with the population median age being 35.
Source: Australian Bureau of Statistics, Region Population Growth). Compiled and presented by .id (informed decisions)
Economic conditions and growth
Economic growth across the Wagga Wagga LGA was steady in 2024, though conditions have likely eased further in recent months as a result of the nationwide slowdown in household consumption. Growth though will continue to be boosted by the significant infrastructure construction boom, including major redevelopments at Defence base Kapooka and RAAF Wagga, the development of the Inland Rail project, the development of two TransGrid projects - Energy Connect and HumeLink, as well as the ongoing development within the Special Activation Precinct.
Financial conditions are restrictive, which is weighing on demand and is helping to bring down underlying inflation. Growth in private demand has been subdued even though household consumption growth looks to have picked up late last year. Public demand has supported overall growth in economic activity over recent quarters.
Underlying inflation has moderated over the past three quarters. Trimmed mean inflation eased to 3.2 per cent over 2024. It is expected to reach the 2–3 per cent target range in early 2025, which is sooner than expected at the time of the November Statement. Headline inflation declined to 2.4 per cent over 2024. Headline inflation remains lower than
underlying inflation, mostly because of the impact of federal and state government subsidies to households. The labour market has remained strong. The unemployment rate declined a little in late 2024 to 4 per cent. Much of the strength in the labour market has been underpinned by strong employment growth in the non-market sector, which in turn has affected labour market conditions in the market sector as both compete for labour. Employment growth has also bolstered household incomes. Outside of the labour market, there is some evidence that capacity pressures have eased.
Source: Economic Outlook – Reserve Bank Australia - statement on monetary policy – February 2025
Annual change in Gross Regional Product
Source: National Institute of Economic and Industry Research (NIEIR) 2024. Compiled and presented in economy .id by (informed decisions)
Total spend in businesses located in Wagga Wagga
Source: CBA Council.IQ
Employment
Labour market conditions remain very strong across the Wagga Wagga LGA into 2025, with unemployment low, and some businesses reporting skills and labour hiring shortages. The unemployment rate was estimated to be just 2.6% in 2025, below the NSW average of 3.8%.
The largest sectors of employment across Wagga Wagga in 2023 were:
• Health Care and Social Assistance (7,637 people or 19.0% of total employment)
• Construction (4,504 people or 11.2%)
• Education and Training (4,259 people or 10.6%)
• Retail Trade (4,194 people or 10.4% of total)
• Public Administration and Safety (4,078 people or 10.2%)
Source: Australian Bureau of Statistics, Labour force survey catalogue number 6202.0, and Department of Employment, Small Area Labour Markets. Compiled and presented in economy.id by .id (informed decisions)
Forecast
The announcement of tariffs between the United States and other major economies poses challenges to the global outlook. But the scale and incidence of the tariffs and their effects remain highly uncertain – which may itself delay some investment until the outlook becomes clearer.
Economic growth is forecast to pick up and the labour market is forecast to remain tight. These forecasts are conditioned on the market implied cash rate path, which had built in 90 basis points of easing by mid2026. Household consumption growth is expected to pick up, which along with growth in public demand is expected to see output growth increase over the coming year. As a result, the unemployment rate is forecast to rise only a little.
Source: Economic Outlook – Reserve Bank Australiastatement on monetary policy –February 2025
Future economic growth conditions should steady across Wagga Wagga subject to the non-emergence of another global shock. The main risks to economic growth over the next five years will come from weak home building which would constrain population growth, delayed delivery of supporting infrastructure, weak short stay accommodation supply, and low levels of innovation investment by existing and new businesses.
Contributions, grants and donations
Wagga Wagga City Council contributes to the community utilising a variety of methods which includes contributions, donations, fee waivers and grant program funding, totalling $2.5M annually. This information is provided in Council’s Operational Plan.
Financial Planning Assumptions
Operating revenue
Figure 2 represents Wagga Wagga City Council’s budgeted operating revenue by category for the 2025/26 financial year.
Rates & Annual Charges
Rating Income
Rates are levied against properties in accordance with their classification as defined in the Local Government Act 1993. Properties are classified as Residential, Business or Farmland based on their dominant use. The calculation of the rateable amount for each property is determined by multiplying the valuation (provided by the NSW Valuer General on a 3 year cycle) by the Ad valorem amount to form the rate base.
Growth within the city from subdivisions and new land releases increases Council’s rates base. Council’s rating structure is reviewed annually and is assumed to remain the same over the life of the LTFP with growth for residential properties each year factored in.
Rate Pegging
The regulation of Council rates in NSW has been largely based on an approach known as ‘rate pegging’. Under this methodology, each year the NSW Government determines the maximum amount by which Councils can increase their general income. The Independent Pricing and Regulatory Tribunal (IPART) determines this rate peg each year. Individual councils can then adjust their rates and annual charges so their general income increases up to this maximum amount, or apply for a special variation to exceed the amount.
In response to a request from the NSW Government, there was a recent review conducted by IPART on the methodology of this calculation. The previous calculation included the change in the Local Government Cost Index, a productivity factor as well as any other pertinent legislative and industry factors.
This calculation has now been updated to include a population factor
which is equal to the annual change in residential population, adjusted for revenue received from supplementary variations (which are adjustments to council’s general income). This is to ensure that a balance is made between Council maintaining costs for existing service levels and by keeping pace with population growth providing additional services as required to meet the growing demand of residents and businesses and improving financial sustainability.
The Base Case scenario includes an ordinary rate increase for 2025/26 of 3.8% as announced by IPART in October 2024 as well as a 1% growth in rateable residential properties. The budgeted increase in rates for 2026/27 onwards is 2.5% annually with an additional 1% growth factor in rateable residential properties for the Long Term Financial Plan.
Figure 2: Total Operating Revenue by category - $153.4M
Council’s rate income is over 57% of it’s total budgeted revenue for 2025/26. The risk to Council in relation to the amount of rates revenue budgeted in the Long Term Financial Plan is that the rate peg announced annually by IPART may be well below the budgeted annual percentages that have been forecasted, resulting in a significant negative impact to Council’s 10 year bottom line (as demonstrated in the Sensitivity Analysis section).
Annual Charges – Domestic & Commercial Waste
Annual charges for waste are modelled at recovering a reasonable estimated cost of providing the service which includes a component for future site rehabilitation. The rate used in the Base Case scenario which is included in the 2025/26 Long Term Financial Plan is:
• 2025/26 - 5% increase plus a 1% growth factor for domestic services
• 2026/27 to 2034/35 – 3% increase plus a 1% growth factor for domestic services
Sewer Charges
Sewer charges are also modelled at achieving full cost recovery including a component for future site rehabilitation and depreciation consistent with Council’s Return on Investment Policy for council businesses. Best-practice sewerage pricing involves a uniform annual sewerage bill for residential customers.
For Non-Residential customers an appropriate sewer usage charge is required for the estimated volume discharged to the sewerage system, together with an access charge based on the water meter size.
The rate used in the Base Case scenario which is included in the 2025/26 Long Term Financial Plan for these charges is:
2025/26 to 2034/35 - 3% increase plus a 1% residential growth factor
Stormwater Management Service Charge
The maximum amount levied for annual stormwater services is prescribed by legislation.
These charges are as follows:
• Residential - $25.00 per property
• Residential Strata - $12.50 per occupancy
• Business - $25.00 per 350 m2
• Business Strata - $5.50 per strata title
This is the basis for which the Base Case and all scenarios of the Long Term Financial Plan are forecasted for the duration of the plan.
User Fees & Charges
Council’s can raise revenue through the adoption of a fee or charge for services or facilities, and applies the general principle that fees and charges should be set at appropriate levels that reflect user pay principles to recover the actual cost of providing the service where possible, and factoring in community affordability.
User Fees & Charges include a diverse range of services such as swimming pools, sporting facilities, weighbridge, livestock, airport and cemetery fees.
This category also includes statutory charges which are priced at the figure stipulated by legislation. Examples of these fees are development assessment fees, planning and building certificates.
The Base Case scenario of the Long Term Financial Plan initially includes a projected average increase in user fees and charges generally between 3% - 5%.
Refer to the 2025/26 Fees & Charges document (The Statement of Revenue Policy) for further details: wagga.nsw.gov.au/fees
Interest & Investment Revenue
Council has an investment portfolio comprising a diversified mix of bank term deposits, cash, fixed rate bonds, growth funds and Floating Rate Notes (FRNs) to achieve its policy objective of maximising returns from authorised investments whilst minimising risk. Council uses independent
professional investment advisory services in the management of its investment assets.
Wagga Wagga City Council’s investment revenue is linked to the expected balance of the portfolio over the 10 years of the plan. With recent interest rate movements, continued high portfolio balance amounts and recent high returns, Interest on Investments has been budgeted to reflect these amounts in the 2025/26 Long Term Financial Plan, but will continue to be reviewed on an annual basis and adjusted accordingly for the 10 years of the plan.
For the Base Case scenario, the projected interest rates are a 3.51%4.56% return on investment over the life of the plan, (which is a marginal increase from the 2024/25 LTFP rates of 3.28% - 4.53%).
Grants & Contributions Grants
It is assumed in the Base Case scenario that the current level of recurrent operating grant funding support from the State and Federal Governments will continue.
This category is mainly attributed to the annual Federal Government Financial Assistance Grant funding program which consists of a generalpurpose component and an identified local road component with both components being untied allowing Council to spend the grants according to local priorities. The forecasted amount for 2025/26 for this grant is $13M with an annual increase of 3% factored into the 10 years of the Long Term Financial Plan.
Grants are a significant source of funding for local government and as such any fluctuation in current levels is likely to have a substantial impact on the delivery of services and projects identified in the Long Term Financial Plan.
This category does not include the receipt of Capital grants funding which is generally tied funding that fluctuates each year specific to a particular capital
project.
Developer Contributions
Developer contributions income has been projected in line with the adopted Wagga Wagga Local Infrastructure Contributions Plan 2019-2034 and enables Council to collect contributions towards the provision and upgrade of public facilities, amenities and infrastructure required as a consequence of development. For Council to levy contributions there must be a clear nexus between the proposed development and the need for the public service or amenity. These funds are held separately to Council’s general income as they can only be applied to the provision of services and amenities identified in the Wagga Local Infrastructure Contributions Plan.
The projects identified in this plan have been reflected in the 10-year capital works program. These plans are subject to review annually with each year of the plan updated accordingly.
Other Revenues
Other revenue includes fines, income from sale of goods, diesel fuel rebates and income from insurance claims. Revenue from these sources is difficult to ascertain with any certainty as they are generally influenced by factors outside of Council’s control. As a result, for the purposes of the Long Term Financial Plan, where applicable other revenue has been projected at a 3% increase on the 2024/25 financial year budget and corresponds to historical trends.
Other Income
Other income includes lease income for Council vehicles, buildings and facilities. Vehicle lease income has been increased by 3% for the 10 years of the Long Term Financial Plan and leases on Council buildings/facilities has been projected at a 2.5% annual increase on the 2024/25 financial year budget.
$2.7M
Operating expenditure
Figure 3 represents the Wagga Wagga City Council’s budgeted operating expenses by category for the 2025/26 financial year.
Employee Benefits and On Costs
Employee Benefits and On Costs include salaries, leave entitlements (annual and long service leave), superannuation, payroll tax and workers compensation and represent 38% of Council’s total operating expenditure. Under the NSW Local Government Award, the base salaries are adjusted annually by award increases, along with performance based progression increases through Council’s salary system for eligible employees. The LTFP for 2025/26 has factored in a 3% award increase. Combining the award increase, performance based increase and the associated on costs, the annual total increase factored into the annual budget for employee costs is 4.5%.
Council also factors into this budget a vacancy assumption based on the anticipated turnover of staff annually.
The risk to Council in relation to the employee expenses budgeted for future years is that the award rate % increase factored into the Long Term Financial Plan may be less than what is determined, resulting in a significant negative impact to Council’s 10 year bottom line (as demonstrated in the Sensitivity Analysis section).
Borrowing Costs - including Low Cost Loans Initiative (LCLI)
External Loan Borrowings
The Council have used borrowings to fund asset works (new and renewal) which is considered a prudent financial strategy when used to fund long life assets. Known as the principle ‘intergenerational equity’ this spreads the burden of financing assets across generations.
Figure 3: Total Operating Expenditure by category
Budgeted borrowing costs of $37.7M for the 10 years have been conservatively forecast for project funding with the following assumptions used:
5.5% 2025/26 – 2034/35 10 year term
If borrowing rates or the amount of borrowings that are required change substantially, then Wagga Wagga City Council will have to adjust the borrowings program as well as capital programs so that an affordable level of debt is always maintained.
Low Cost Loans Initiative (LCLI)
NSW Planning & Environment announced a $500M Low Cost Loans Initiative (LCLI) in late April 2018. The key aim of the LCLI is to enable and fast track new housing supply.
The essential elements of the initiative are:
• the NSW Government will refund 50% of the costs of council’s interest payments on loans for eligible infrastructure
• the council is responsible for repaying the loan which is funded by NSW Treasury Corp (TCorp), or another financial institution of the council’s choice
• Loans taken out must be for a minimum of $1M and have a fixed interest rate and must be no longer than 10 years
• Councils showing that planned infrastructure will be substantially completed by 30 June 2021 will be preferred for LCLI support
Council was successful in its Round 1 and 2 applications to NSW Planning & Environment for eligible infrastructure projects predominantly funded from Section 7.11 Contributions, Stormwater DSP Contributions, Civil Infrastructure Reserve and the Sewer Reserve. This has resulted in cashflow adjustments to these funding sources which has been funded initially through external borrowings with a 50% interest subsidy to be received, and the remaining loan repayments for the term of the loan to be funded from these reserves.
A review of the timeframe for projects funded from the LCLI has recently been undertaken, with some of the projects to be amended and their funding source replaced with their original funding source.
Materials & Contracts
This category includes contractor costs for waste collection and general maintenance costs of Council’s buildings and community facilities. Projected costs and increases in materials and contract costs are generally in line with expected inflation, with the remaining costs of materials and contracts to be maintained within existing annual budget allocations.
Depreciation
The forecasted Depreciation of assets is a non-cash budgeted expense which is reflective of new capital additions, purchases and asset renewals over the term of the Long Term Financial Plan. Depreciation levels are subject to an ongoing review with each year of the plan.
Other Expenses
Utilities
An increase has been projected in the Long Term Financial Plan for electricity of 9% for 2025/26 only based on contract rates (reducing to 7% from 2026/27 onwards), gas of 7% and water costs of 5% per annum ongoing.
Wagga Wagga City Council is actively pursuing efficient alternative sources of energy including the adopted energy saving capital projects as well as the completed LED street lighting upgrade project with these projected savings included in the Long Term Financial Plan. The recent Power Purchase Agreement (PPA) for the provision of electricity has resulted in further projected energy savings which have been restricted into a separate reserve, as per Council’s Corporate Net Zero Emissions 2040 Strategy.
Insurance
It has been assumed that all insurances which predominantly include property, liability and fidelity for 2025/26 and ongoing in the Long Term Financial Plan are forecast to increase by 7.5%.
Other Operating Expenses
This includes Bushfire and Emergency Service Levy’s which are budgeted to increase by 3% annually and Section 356 contributions which are to be maintained within the resolved annual budgets.
Annual challenge of balancing the budget
An indication of the financial sustainability of any business is its ability to balance both its annual cash budget as well as its annual operating result (including depreciation and excluding capital grants).
Figure 4 demonstrates the relationship between operating revenue and operating expenditure. As shown in this graph, Council’s costs rise faster than its revenue and this challenge impacts both the Council’s ability to balance its annual cash budget and its operating result.
Wagga Wagga City Council’s operating expenditure including depreciation is greater than its operating income for the first 7 years of the LTFP. This indicates that Council still has a substantial way to go in the interim to be able to fund depreciation and maintain financial sustainability in the long-term.
Figure 4: Operating Revenue and Expenditure
Sensitivity Analysis
Although the assumptions listed in the previous section are informed estimates based on reliable information at that point in time, Long Term Financial Plans are inherently uncertain. They contain a wide range of assumptions, including assumptions about interest rate movements and the potential effect of inflation on revenue and expenditure, which are largely outside of Council’s control.
The financial effect if certain assumptions were to change in relation to Council’s fixed operational income and expenditure are illustrated below, which would in turn affect the ability to carry out the activities as identified in the Operational Plan and Delivery Program.
Rates
Rates comprise 57% of Council’s total operating income for 2025/26. As stated earlier, rates are capped by the State Government and Council can only increase rates above the IPART rate pegging percentage if a Special Rate Variation is submitted and approved.
If general fund rates are accumulatively held 1% p.a. below the predicted rate pegging percentage, the effect on the Long Term Financial Plan Base Case budget operating result before Capital Grants and Contributions represents a reduction of $28M in revenue over 10 years (shown in Figure 5 and Table 2).
Surplus/(Deficit) before capital grants and contributions
Salary growth is largely subject to the NSW Local Government Award. Wagga Wagga City Council factors in an annual increase in employee expenses to cover both award and progression increases. If the Award increased by 1% over and above the existing assumption built into the Long Term Financial Plan, the effect on the Base Case budget deficits before Capital Grants and Contributions represents an increase in expenditure of $28M over 10 years (shown in Figure 6 and Table 3).
Surplus/(Deficit) before capital grants and contributions
Figure 7 and Table 4 below shows the combined impact of a 1% unfavourable variance in our assumptions for Rate Income and Employee Costs (cumulatively a negative impact of $57M over 10 years):
Surplus/(Deficit) before capital grants and contributions
7: Combined impact of rates and employee costs analysis
The commentary and analysis provided in the document to this point describe the Base Case model of the Long Term Financial Plan. This model which is inclusive of the previously detailed assumptions will be recommended to Council for adoption.
Add back Depreciation Expense (noncash)
Scenarios -
Infrastructure Renewal and Maintenance Shortfall Scenario
The Council has a large portfolio of built assets and facilities which support the provision of services to the community. Much of the City’s assets and facilities are ageing and in need of maintenance, renewal or upgrade, however the Council has limited funds with which to do this.
As part of the Long Term Financial Plan review process, and ongoing discussions with Council’s Asset Management division, it has been identified that Wagga Wagga City Council requires funds of $316,217,682 over 10 years of the Long Term Financial Plan to address its Infrastructure Maintenance and Renewal Shortfall.
Along with many other NSW Councils, Wagga Wagga City Council is in the process of improving the maturity of its asset management data, and through the use of predictive modelling software will be better able to predict the financial requirements of renewal and maintenance activities and the year in which the funding is required. This figure is based on the most up to date asset information in Council’s Asset Management Systems across all asset categories.
In order to eliminate or reduce this shortfall and meet ongoing costs, the option of a Special Rate Variation (SRV) may need to be investigated, which will include further community engagement and the continual review of the Asset Management Plans, to determine required funding over the 10 years of the Long Term Financial Plan.
The Infrastructure renewal and maintenance shortfall of $316M is allocated across the 10 years of the Long Term Financial Plan as follows:
In order to fund the shortfall, an SRV funding scenario may be developed as follows:
Part fund 10 year Infrastructure Shortfall from Special Rate Variation Scenario
Under the Local Government Act, Councils are able to seek additional increases in general rates income beyond the annual rate peg, by applying to IPART for a ‘special variation’ to rates (SRV).
There is a timing deadline of November 2025 for the annual application to IPART for a potential SRV application in Year 2 of the Long Term Financial Plan, therefore if approved, will be proposed to commence this SRV from 2026/27.
If Council was to fund the infrastructure shortfall from 2026/27 to 2034/35 of $283M with a Special Rate Variation, this would result in an average increase to rates of approximately 61.3% for 2026/27 in addition to the existing budgeted 2.5% rate peg increase included in the base case scenario. As 63.8% is considered a significant increase to the ratepayer, it is proposed to instead part-fund the shortfall by proposing an increase similar to the previous SRV that was in place from 2016/17 – 2020/21 for the levee project as ratepayers had previously factored this amount in to their household budgets. This increase would then be maintained along with the budgeted rate peg for the remaining years of the Long Term Financial Plan.
This scenario would equate to an approximate 3.9% increase (50% reduction applied for farmland of 1.95%) along with the annual estimated rate peg of 2.5% which would result in additional potential rates income ongoing of $33M for the remaining nine (9) years of this LTFP from 2026/27 as follows:
Major projects
Included in Council’s 2025/26 Long Term Financial Plan Capital Works Program (Appendix 8) are the following significant projects with an allocated budget of over $5M (excluding Roads projects):
passenger numbers and supporting the growth and expansion of the range of general aviation businesses and other operators relying on the Airport.
The program of works includes the expansion of the arrival and departures terminal, construction of covered walkway and accessible parking area and reconfiguration of the front-of-house access.
This project is contingent on receiving grant funding, and also contingent on Council receiving a renewed lease from the Department of Defence past the current 30 June 2026 lease end date.
Airport – Runway Lighting Upgrade
The Airport Runway Lighting project is for the upgrade of taxiway lighting infrastructure and technology to Taxiways A, B & L which will accommodate low visibility operations to resident operators. The project will also ensure compliance with regulatory standards, and access to all taxiways and aprons.
This project is funded from Loan Borrowings and the Airport Reserve and is also contingent on Council receiving a renewed lease from the Department of Defence past the current 30 June 2026 lease end date.
*Council is currently in the process of negotiating a new lease term with the Department of Defence. The current lease term ends on 30 June 2026. See below for further information.
The potential uncertainties around some of Council’s planned major projects have the ability to have a significant impact on the Long Term Financial Plan, both in regards to timing and costing and the utilisation of funding sources.
Airport – Redevelop Terminal
This project is for the redevelopment of the passenger terminal precinct, as a result of increased passenger numbers and aviation related activity and reaching operational capacity at the Airport. This upgrade will allow the Airport to continue to operate safely and comfortably in the future, whilst managing current and growing
Bolton Park Upgrade
This upgrade of Bolton Park is listed in the recommendations contained in the 2018 Bolton Park Masterplan which aimed to guide the future development of all areas of the Bolton Park Precinct including the Oasis Regional Aquatic Centre, Robertson Oval, Jim Elphick Tennis Centre, Bolton Park Stadium, Bolton Park Open Space, Skate Park, croquet facilities and cricket needs.
The aim of the project is to activate the Bolton Park Precinct, turning it into a sports hub that attracts athletes, officials and tourists, boosting Wagga Wagga’s growth and reputation.
This project has also been identified in the Wagga Wagga Local Infrastructure Contributions Plan 2019-2034. Funding for the project includes Section 7.11 contributions $4.2M, Council Loan Borrowings
$1.5M, and is contingent on receiving significant Grant funding $25.9M.
Stage 1 of this upgrade has been budgeted separately and is scheduled for completion in 2024/25.
GWMC – Domestic Precinct
Council will make major improvements at Gregadoo Waste Management Centre including new weighbridges and associated approach roads, a control building and carpark.
The new weighbridge will be located toward the entrance of the Centre to facilitate weighing and improve the management of waste and recycling activities.
The planned new domestic precinct centre will see small vehicles and the general public separated from the large vehicles and waste contractors with emphasis on waste separation and improved efficiency with all customers being processed with minimal delay.
This project is to be funded from the Solid Waste Reserve.
GWMC – Future General Waste Cell Construction
Future funding has been allocated for a new general waste cell which is to be developed in accordance with the needs and growth of the community. The project has also been established from legislative requirements as per the commitments from the Gregadoo Waste Management Centre Environmental Impact Statement including airspace cost calculations.
Once the existing general waste cells near the end of their life and reach capacity, a new cell is required providing a vastly increased capacity for the disposal of general waste, bushfire and natural disaster generated waste into the future.
This project will be funded from the Solid Waste Reserve.
GWMC – Waste to Energy (Solution)
This concept will be a future consideration at the Gregadoo Waste Management Centre, involving the construction of plant to generate energy in the form of electricity and heat from the treatment and burning of waste materials.
With Council’s ongoing education programs and implementation of waste avoidance measures including reuse and recycling programs, this waste to energy solution will be a future opportunity to get value from material that would otherwise go to landfill.
This project will be funded from the Solid Waste Reserve.
Lake Albert Water Sports and Event Precinct
Budgets have been allocated for the Lake Albert Water Sports and Event Precinct project, to address community concern regarding the ongoing performance of Lake Albert.
The scope of the project will allow for the construction of infrastructure to pump water from the Murrumbidgee River into the lake, the remediation of the foreshore and upgrade of two existing weir structures.
The scope of works will include:
• Construction of infrastructure that will allow 1800Mls of water to be pumped from the river to the lake annually
• Remediation of 2350m of foreshore to address erosion issues
• Upgrade of existing weir and spillway system
This project is funded 50% from the Australian Government’s Growing Regions Grant Program $4.5M and 50% from Council’s internal reserve allocations $4.5M.
Levee Bank System Upgrades - Main City Levee and North Wagga Levees
Wagga Wagga City Council have completed Stage 1 and 2 of the Main City Levee Upgrade which has upgraded the Main City Levee to a 1 in 100-year level of protection. These works have resulted in the strengthening of the levee system to help safeguard the central business district and many of the city’s critical assets and thousands of homes.
As commissioned by the Floodplain Risk Management Advisory Committee the independent peer review of the North Wagga component of the overall Floodplain Risk Management Study and Plan has now been completed. The review looked at the process surrounding the risk assessment strategy and consultation processes for all flood mitigation options proposed for North Wagga. Council resolved to endorse the final peer review, noting it showed no findings which would materially change the outcomes of the original 2018 study and plan. Council has now supported the recommencement of the original feasibility study for flood mitigation options for North Wagga and surrounding floodplain areas, incorporating a thorough communication and consultation process.
The Floodplain Risk Management Advisory Committee and Council in February 2024 received a report prepared by consultants regarding North Wagga Flood Mitigation Options, with a further report following the public exhibition and submission period presented and adopted by Council in May 2024.
This report recommended as part of Stage 1 to upgrade the existing North Wagga Levee System to a 5% Annual Exceedance Probability (AEP) level, or 1 in 20 levee. Stage 2 of the project includes a suggested increase to the road heights and bridges along Hampden Avenue, and to consider further measures or new designs as outlined in the report. This decision enables Council to now begin planning for the design and implementation of Stage 1 with Stage 2 to be considered in the future, subject to funding and approval processes.
Northern Sporting Precinct
This project has been identified as part of Council’s Recreation, Open Space and Community Strategy 2040 (ROSC) as well as previous and current infrastructure contribution plans for the development of a regional sporting facility to deliver multisport and community facilities to cater for the expanding northern growth area of Wagga Wagga.
The intent of this project is to create a centralised activity precinct for the wider community including community meeting facilities and improved and expanded sporting facilities located at Peter Hastie Oval.
The Peter Hastie Oval site will include the following works:
• Refurbishment of Oval including upgrade of lighting
• New Clubhouse including female friendly change rooms
• New Interchange Benches
• Electronic Scoreboard
• Cricket Wickets and Nets
• Construction of two netball courts and lighting
• Two new rectangular sports fields
• Small canteen/amenity building to service new fields
• Exercise pathways
• Carpark extension including on-street Carparking
• Perimeter Fencing
• Shaded Playground
• Skate Park facilities
This project is funded from various funding sources including Section 7.11 Developer Contributions, General Purpose Revenue, Reserves and External Borrowings.
Oasis Energy Efficiency Upgrade
This project will see the replacement of pool and air heating systems with electric heat pumps as well as upgrades to the Oasis facilities building management systems and electronic control valves.
Implementing this project will not only significantly reduce carbon emissions, it will also allow for the replacement of plant that is currently reaching end of life and in need of renewal. It will also reduce the impact of condensation damage and patron discomfort within the pool hall due to high humidity levels.
Council was successful in securing $2.5M in funding through the Community Energy Upgrades Fund (Australian GovernmentDepartment of Industry, Science and Resources) towards this project, with Council’s required co-contribution of $5.85M comprising of existing Oasis projects funded from S7.11, and internal Reserve allocations.
Sewer Augmentation & Upgrade – Forest Hill
Funds have been allocated in the Long Term Financial Plan for the Forest Hill Sewer Augmentation and Plant upgrade project.
This project is required as the plant is at current capacity as a result of the recent housing development and growth in the area. With planned future development of 100+ homes, the infrastructure growth requirements in the area will continue to increase, needing further investment into Sewer infrastructure and assets.
This project will be funded from the Sewer Reserve.
Sewer Upgrades – Northern Growth Area
This project links the Northern Growth Area and Bomen Special Activation Precinct and will provide capacity to cater for housing growth and industrial growth in the north of the City.
This project will see an additional three pump stations on the northern side of the river, a sewer treatment plant orbal inlet, and an additional 1.5km trunk main and 3.62km in sewer mains.
Council was successful in attracting $71M of grant funding through the Accelerated Infrastructure Fund (AIF) Round 3. This funding was to go towards 3 projects which included the upgrades to the Sewer Network in the north of Wagga Wagga as well as Plumpton Road duplications between Lake Albert Road and Gregadoo Road (Plumpton Road North) and Gregadoo Road and Rowan Road South (Plumpton Road South).
This Sewer project is funded $21.2M from AIF grant funding and $7.1M Council contributions from the Sewer Reserve.
Roads projects
Included in Council’s 2025/26 Long Term Financial Plan Capital Works Program (Appendix 8) are both one-off and recurrent Roads project funding across the 10 years. The total amount budgeted of $271M, which includes one-off projects of ($117.4M) and recurrent programs of ($153.6M). The One-off Roads projects and Recurrent Roads program budgets across the ten years of the LTFP are shown below:
Recurrent Roads
Appendices
The following summary documents are provided as appendixes to the Long Term Financial Plan document. They provide a summary of the financial projections of Wagga Wagga City Council over the next 10 years. It is important that these documents are considered as a total package and not in isolation to gain a clear picture of Council’s budgeted financial position over the next 10 years.
Appendix 1
Budgeted Income Statement
Appendix 2
Budgeted Balance Sheet
Appendix 3
Budgeted Cash Flow Statement
Appendix 4
Key Performance Indicators (KPI’s)
Appendix 5
Budgeted External Restrictions
Appendix 6
Budgeted Internal Restrictions
Appendix 7
External Loan Projects and Debt Servicing
Appendix 8
a) Capital Works Program – One off projects
b) Capital Works Program – Recurrent projects
Appendix 9
Airport - Ten Year Financial Plan
Appendix 10
Livestock Marketing Centre - Ten Year Financial Plan
Appendix 11
Sewerage Services - Ten Year Financial Plan
Appendix 12
Solid Waste Services - Ten Year Financial Plan
Appendix 13
Stormwater Levy - Ten Year Financial Plan
Appendix 14
Budgeted Income Statement by CSP Function
Appendix 1 - Budgeted income statement
Revenue From Continuing Operations
Appendix 2 - Budgeted balance sheet
Appendix 2 - Budgeted balance sheet (cont.)
Appendix 3 - Budgeted cash flow statement
Appendix 3 - Budgeted cash flow statement (cont.)
Cash Flows from Financing Activities
Cash Equivalents & Investments -
Appendix 4 - Key Performance Indicators
Appendix 4 - Key Performance Indicators (cont.)
Measure: Council’s ability to fund it’s ongoing loan interest repayments. NSW TCorp Benchmark >= 3.00
Measure: Assess the impact of uncollected rates and annual charges
Restrictions (Reserves)
Council maintains both statutory (externally restricted) and discretionary (internally restricted) reserves that acknowledge the receipt of funds from various sources and realised savings which are prudently kept aside to respond to events that cannot be predicted or planned and that are consistent with the purpose of that reserve fund as detailed in Council’s adopted Policy ‘POL-021 Financial Reserves for Future Expenditures’ as follows:
• Externally restricted reserves are only available for specific use by Council due to a restriction placed by legislation or a third-party contractual agreement.
• Internally restricted reserves are not subject to external restrictions and may be internally allocated by resolution or policy of the elected Council
The Reserves are currently maintained as shown in Appendix 5 and Appendix 6:
Appendix 5 - Budgeted External Restrictions
Appendix 5 - Budgeted external restrictions
Section 7.12 Developer Contributions
* Unexpended Grants are also classified as externally restricted funds - however these are not shown in this table
Appendix 7 - External loan projects and debt servicing
Appendix 7 - External loan projects and debt servicing (cont.)
Appendix 7 - External loan projects and debt servicing (cont.)
Appendix 7 - External loan projects and debt servicing (cont.)
2027/28
Appendix
Appendix 7 - External loan projects and debt servicing (cont.)
Appendix 7 - External loan projects and debt servicing (cont.)
Appendix 7 - External loan projects and debt servicing (cont.)
Stormwater Levy Debt Servicing
Appendix 7 - External loan projects and
Appendix 8a - Capital Works Program – One-off Capital Projects
The One-off capital projects and Recurrent capital works program represent Council’s current commitment to project delivery for the 10 years of the Long Term Financial Plan. The projects allocated in the 2025/26 financial year will be reported to Councillors and the Community as part of the Delivery Program and reviewed.
9
2
Appendix 8a - Capital Works Program – One-off Capital Projects (cont.)
Appendix 8a - Capital Works Program – One-off Capital Projects (cont.)
Appendix 8a - Capital Works Program – One-off Capital Projects (cont.)
Appendix 8a - Capital Works Program – One-off Capital Projects (cont.)
66
Appendix 8a - Capital Works Program – One-off Capital Projects
Appendix 8a - Capital Works Program – One-off Capital Projects (cont.)
+
+ S7.11
+
+
(CEUF)
82
(GPR
Appendix 8a - Capital Works Program – One-off Capital Projects (cont.)
Appendix 8a - Capital Works Program – One-off Capital Projects (cont.)
Appendix 8a - Capital Works Program – One-off Capital Projects (cont.)
Appendix 8a - Capital Works Program – One-off Capital Projects (cont.)
Appendix 8b - Capital Works Program – Recurrent capital projects
$110,000 (25/26)
$70,000 (25/26) +
$20,000 (25/26-29/30) with
to reserves 26/27-29/30 and reductions to reserves and increases to GPR from 30/31-33/34 and 34/35 100% funded from GPR
Appendix 8b - Capital Works Program – Recurrent capital projects (cont.)
25/26 Grant (Roads to recovery - R2R) $3,281,130 + Grant (Regional Roads Block) $656,242 + GPR $2,488,733 + 2026/27 ongoing (R2R 26/27-28/29 as per schedule, 29/3034/35 $2,051K with ongoing 3% increments + Block 2%
Appendix 8b - Capital Works Program – Recurrent capital projects
Appendix 9 - Airport Ten Year Financial Plan*
* The forecast cash budget surplus shown for the Airport in 2025/26 is for the payback to the Internal Loans Reserve for previous financial year’s Airport deficits which at the time were unable to be funded from the Airport Reserve due to its low balance. From 2026/27 to 2034/35 the operating Airport surplus result will then be transferred to the Airport Reserve.
Appendix 10 - Livestock Marketing Centre Ten Year Financial Plan
Appendix 11 - Sewerage Services Ten Year Financial Plan
Capital and Reserve Movements
Appendix 12 - Solid Waste Services Ten Year Financial Plan
Appendix 13 - Stormwater Levy Ten Year Financial Plan
Capital and Reserve Movements
Appendix 14 - Budgeted Income Statement by CSP Function
This funding summary details the Community Strategic Plan (CSP) themes (Regional Leadership, Sustainable, Growing, Vibrant) budgets for the 10 years of the Long Term Financial Plan.
