Nelson City Council unanimously decides to consider 0% rates rise

Nelson City Council has shown its commitment to supporting the community through the COVID-19 crisis by voting unanimously to consider a zero percent rates rise in the 2020/21 Annual Plan.

At an Extraordinary Meeting held today (9 April) Council asked officers to investigate the impacts of a zero percent rates rise on the budget for 2020-21, outlining how the 0% rate rise will be achieved and report back to Council in late April.   

Consultation on the Annual Plan is being extended to 06 May, so the public will have a chance to have their say on the proposal.   

In the same meeting, Council agreed to a comprehensive relief package designed to aid Nelson’s recovery from the COVID-19 shutdown.   The package includes:

• Establishing an emergency fund of $200,000 to support community organisations impacted by Covid-19.
• Suspending all parking fees in the City Centre until the end of June 2020.
• Remitting penalties for late payment of the fourth instalment of 2019/2020 rates and establishing payment plans for those in financial difficulties.
• Removing the $5000 cap on applications to the 2021/22 Community Investment Fund and prioritising projects that reduce the impact of Covid-19 on vulnerable communities.
• A three month rent holiday for Council tenants in the hospitality, tourism, and community sector.
• A three month holiday for the payment of Outdoor Dining Licenses
• Lobbying Government to waive alcohol licencing fees and allow businesses to voluntarily extend their food licencing period by the amount of time they are not operating due to the shutdown.

The package is designed to draw people back to the central city, help Nelsonians financially through this difficult period and ensure groups that do so much to assist our community can survive in this difficult time.   

The new parking measures are designed to encourage people to visit Nelson’s city centre once the COVID-19 shutdown is over and bring our high streets back to life. 

Drivers are asked to be community-minded when using the new system, it is not intended to be all day free parking for people who are commuting to work.   

Simon Duffy of Uniquely Nelson says he fully supports Nelson City Council’s financial relief for city businesses during these difficult times.  

“These are initiatives and provisions that will help with recovery for so many businesses, especially with our boutique localized shops that Nelson offers.”

Chief Executive of the Nelson Regional Development Authority (NRDA) Mark Rawson says he is in favour of the zero rate rise, but stressed that the money spent by Council over the next financial year would be a key stimulus for the economy.  

“A zero percent rate rise is the responsible approach in the current economic climate. It will support one of the key focus areas of our restart and recovery planning which is on the short-term stimulation of demand within the local economy to help restart of the services sector. At this time it is also important that Council can continue its critical role of investment in infrastructure projects, which will create further services demand and strengthen local supply chains.“ 

Rates make up 67% of Council’s revenues, and without a rate rise Council’s proposed budget for 2020/21 would be reduced by $3m. This shortfall would be covered by a staff wage freeze, money saved from events that have now been cancelled, and by either not contributing to or drawing down from the Council’s disaster recovery fund.  

Nelson Mayor Rachel Reese said she favoured a 0% rate increase, as opposed to a second option of increasing rates by the Consumer Price Index of 1.9% to cover inflation.  

“The Covid-19 shutdown has changed things considerably.  People are on reduced wages or facing unemployment and businesses are under considerable pressure, with many unable to operate. This Council will not put more pressure on people’s finances during this difficult period.”

Councillors discussed whether a 0% rates rise this year would simply mean an even greater rise next year, but Mayor Reese and Chief Executive Pat Dougherty both say that would not be the case.  

“These are times of uncertainty,” says Mayor Reese. “So it is difficult for anyone to predict the economic situation for 2021/22, but I will not be planning for a larger rise than has been applied in other years of the Long Term Plan. We will still be in recovery and that will be my focus.”

Chief Executive Dougherty agrees.  

“Council would not be proposing a larger than normal rate rise next year," he says.    

As well as providing the relief package for local businesses and the community, Council is putting forward projects for funding to a Central Government initiative – the Crown Infrastructure Partnership – that seeks to identify ‘shovel ready’ infrastructure projects worth more than $10m that have been impacted by COVID 19.   

Mayor Reese said the Council was completely focused on doing all it could to get Nelson back on its feet but it couldn’t do it single-handedly. This money would provide the region with a vital boost.  

“No community in New Zealand will be able to dig itself out of this hole on its own. Support for local economies from Central Government will be essential as Nelson, and New Zealand as a whole, starts on the long road to recovery.”