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Holroyd Council's Tim Butler. Holroyd Council's Tim Butler.
21 December 2013 Posted by 

No debt as council moves to the future

INTERVIEW with Tim Butler, Director Corporate and Financial Services Holroyd City Council.

WSBA. Is Holroyd City in debt?

A. As at 2012/13, Holroyd City has $0 debt. Our funding gap isn’t a debt; it’s the additional income we need to maintain our services and infrastructure for today and the future. Over the past 20 years our community has enjoyed a growing number of new services and infrastructure which we’ve stretched all our funds trying to maintain. So we’re now at a point where we need to decide whether to reduce, maintain or enhance our services and infrastructure.

WSBA. Is Holroyd the only city looking at a rate increase?

A. No. 23 cities applied for a rate rise in 2013/14.

WSBA. What would the income from a rate increase be invested into?

A. The lower level rate increase would provide us with an additional $97.1m over the next 10 years to maintain our services and infrastructure and renew our ageing assets. The higher level rate increase would provide us with an additional $110.2m over the next 10 years to maintain our services and infrastructure and renew our ageing assets; as well as provide new services and/or infrastructure.

WSBA. Why can’t Council address the funding gap by increasing income and savings?

A. Council’s first need to maximise all other avenues to increase income and savings before qualifying for a rate increase. From increasing income from property assets to savings by using recycled materials in road construction; we’ve maximised all other revenues and now need to consider the rate increase option.

WSBA. Why can’t Council address the funding gap by other income sources?

A: Around 40% of our total income is provided by non-rate income sources, such as grants. Grant funding opportunities are pursued by Council however, most available opportunities are for funding specific projects (as opposed to ongoing services and infrastructure renewals) and don’t provide a guaranteed income source for the City over the long term. Without a guaranteed income source, service and infrastructure delivery also can’t be guaranteed. A common non-rate income source which councils often increase to reduce their rate to non-rate income source ratio is ‘User Charges’, which include childcare fees, parking fees, facility hire charges, development application charges, etc. However even if there was to be a substantial increase in User Charges, this increase couldn’t generate enough income to address Holroyd’s funding gap.

WSBA. What happens if most of our community want to reduce services and infrastructure standards?

A. Council will vote on whether to reduce our services and infrastructure standards in February 2014 and if so, we’ll begin discussing reduction options with our business and residential community thereafter.

WSBA. What types of services would be reduced if we didn’t have a rate increase?

A. If it’s decided to leave rates and reduce our services and infrastructure standards, we’ll begin discussing reduction options with our business and residential community.

WSBA. Why do we need a rate increase when we have funding coming in through Section 94 levies?

A. By law, Section 94 funding must be used to deliver new infrastructure, not to fund maintenance and renewal of existing infrastructure.

WSBA. Why did Council resolve an LEP that will lead to population growth if population growth is a problem?

A. Our community’s projected growth is a positive for our City’s future and so it’s important that we address the challenges this growth presents now rather than allow them to become problems later.

WSBA. Why should business ratepayers get involved in all this?

A. What happens to our City’s services and infrastructure should be a decision for our business and residential community. We are here to listen. Their future... their hands.



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