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Thursday, May 28, 2015
Vol 44, No 30
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â&#x20AC;&#x2DC;We must reduce our dependence on ratesâ&#x20AC;&#x2122; By MARIANNE KELLY
T
WO clear messages, to keep rate increases and debt levels low, have been addressed says Auckland Mayor Len Brown, despite widespread criticism. Household revaluations, a continuing transition to a standard rate across the SuperCity and now the imposition of a transport levy is making the average general rate increase of 2.5 per cent, agreed for 2015/2016, academic in many ratepayersâ&#x20AC;&#x2122; minds.
But Mr Brown says â&#x20AC;&#x153;we dropped the rate increase to 2.5 per cent and I have delivered what I said I wouldâ&#x20AC;?. Also, $3 billion of projected spending has been chopped from the 20152025 Budget while future borrowing has been capped at no more than 12 per cent of revenue. â&#x20AC;&#x153;Forty per cent of what we spend is on transport and three-quarters of what we spend on the transport build is borrowed, so putting a noose around debt levels has been a key driver,â&#x20AC;? he says.
With rates forming about 43 per cent of the SuperCityâ&#x20AC;&#x2122;s revenue base, Mr Brown says the council needs to continue to reduce its reliance on rates and is currently moving to fully depreciate its assets to reduce debt levels. â&#x20AC;&#x153;Under this budget we are allowing for an extra two to two-and-a-half percent depreciation, as the legislation allows, which will increase the amount of money we can use for the maintenance of assets or to pay down debt.
â&#x20AC;&#x153;The balance sheet is shifting and our level of rates to non-rating revenue [43 per cent] is low compared with other councils throughout the country which work on 50-60 per cent,â&#x20AC;? he says. â&#x20AC;&#x153;But that in itself is making us look to drive it down further and weâ&#x20AC;&#x2122;ve asked our new chief ďŹ nancial ofďŹ cer [Suzanne Tindall] to look at the councilâ&#x20AC;&#x2122;s $2 billion property portfolio, including Albert Street [the new administration headquarters]. â&#x17E;¤ Turn to Page 3
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