kā tāke kaunihera
If you own property, then you pay rates. The level of rates set by the Council depends mainly on what services and facilities the community wants.
An overall rates rise of 9.8% is proposed for the first year of this 10 year plan. After that, the increase varies, but will be 5.7% on average across the following nine years. We know higher rates can be hard for people to afford and the DCC will be doing its bit too. Staff need to save $4 million in the first year of the plan, so we’ll be looking at how we can improve the way we do things.
As well as outlining what overall rates rises are planned, we have to have rates limits so our community is clear about what to expect over the next 10 years. We propose limiting the rates increase to 10% in the first year to help us cover the costs of running the city. The rates limit will be 6.5% on average over the next nine years.
We know these are big increases, but we can’t keep rates low and still do the things the community wants and that we need to do, such as replace old pipes.
This graph shows what we’re proposing.
This table contains the Forecast rates increase for years ending 30 June.
|Rates forecast||Rates limit|
|Draft Budget 2022||9.8%||10.0%|
|Draft Budget 2023||7.0%||6.5%|
|Draft Budget 2024||7.0%||6.5%|
|Draft Budget 2025||6.0%||6.5%|
|Draft Budget 2026||6.0%||6.5%|
|Draft Budget 2027||6.0%||6.5%|
|Draft Budget 2028||5.5%||6.5%|
|Draft Budget 2029||5.5%||6.5%|
|Draft Budget 2030||4.2%||6.5%|
|Draft Budget 2031||3.9%||6.5%|
This diagram shows what we spend your rates on.
Currently we have debt of $257 million. We need to be able to borrow more money so that we can deliver what we need to do. Our last 10 year plan had a fixed amount that we could borrow of $350 million. We need to increase the amount we spend on renewing and building new assets, and this borrowing limit will not be enough to let us do that.
Spending to maintain and renew our assets is a big priority and we need debt to help us do this.
Our draft Financial Strategy sets our debt limit differently, allowing us to borrow up to 250% of our revenue.
This new way to set our debt limit is commonly used by big councils across New Zealand. It means we will be able to deliver our planned capital projects, and we could fund any emergency work if we needed to.
The 250% of revenue is a debt limit, not a goal or target. We will only borrow money if we need it. Setting a flexible debt limit will help us deliver our big capital programme for the next 10 years.
The current plans mean we would be borrowing 211% of revenue ($880 million) by the end of the 10 years. We do have investments that we can use to offset our debt. These investments, worth about $300 million, are the Waipori Fund, an investment property portfolio and our investment in Council companies.
There is always a trade-off between doing stuff and paying for it, and borrowing is one way to try to find a balance. Borrowing spreads the load across generations – some people think this is fair, some don't.
This graph shows what we’re proposing.
Forecast debt for years ending 30 June.
|Debt limit||Debt forecast|
|Draft Budget 2022||717||352|
|Draft Budget 2023||753||428|
|Draft Budget 2024||796||492|
|Draft Budget 2025||828||565|
|Draft Budget 2026||853||634|
|Draft Budget 2027||899||694|
|Draft Budget 2028||937||745|
|Draft Budget 2029||974||794|
|Draft Budget 2030||1005||830|
|Draft Budget 2031||1041||880|
te tahua mō te kahurutaka
10 year budget
te puna pūtea
where we get our money from
The DCC gets its money from a range of sources. About 67% comes from your rates, with the rest from fees, charges, rents, subsidies and grants, as well as some money from council-owned companies.
The rates you pay are related to the capital value of your property. The following table shows what the proposed rates rise in 2021-22 means for a selection of different properties.
Go to www.dunedin.govt.nz/rates to see your rates.
This table contains the Rates examples for the 2021/22 year.
|Capital Value||2020/21 Rates $||2021/22 Rates $||Increase $||Increase %|
|Farmland (general and community services rates only)|
|Lifestyle (general and community services rates only)|
|Residential heritage bed and breakfast|