Revenue and Financing Policy

Should we change how we fund our footpaths?

Council is proposing to change how we fund footpaths and this will have an impact on rates across the District.

As this is a change to our Revenue and Financing Policy we need to consult with our community and get feedback before we confirm this change.

The impact of this change is that the cost for all footpaths will be spread across the whole District. The resulting increase in rural rates will be matched by an increase in footpath replacement and maintenance in coming years, to lift the quality of these footpaths to match those in larger urban areas across the District.

The proposed changes under the Revenue and Financing Policy have been included in the draft budgets for this LTP and are represented through the ratings examples provided.

Where are we at?

What is the Revenue and Financing Policy?

This Policy sets out how we fund all our activities, including the different methods of funding we’ll use, such as general rates, targeted rates, fees and charges. The Policy isn’t about how much we intend to spend, but about how we intend to spread the cost of each service across the District and among different groups of ratepayers. It also sets out our rationale for why we fund these services in this way. For example, our rationale for funding our Animal Control services mainly from dog registration fees is because the owners of dogs create the need for Council to monitor and control stray and aggressive animals. The Policy is reviewed every three years, in line with the development of our Long Term Plan.


Why the proposed change?

The main change Council is proposing is the way we fund footpaths across the District. Under the current Policy, footpath replacement and maintenance is funded through a targeted rate based on the land value of each rating unit. There is a targeted rate set for each of the following areas; Geraldine, Temuka, Timaru, and Rural areas (including Pleasant Point).

This Policy was set because previously, Council did not receive any funding assistance from Waka Kotahi (New Zealand Transport Agency) for footpaths. It was decided that each community should set the level of funding for footpaths in their area. This was done through the Long Term Plan and Annual Plan budgeting process with Council and Community Boards. In 2018 Waka Kotahi began providing co-funding for footpaths.

This has allowed Council to increase the amount spent across the District as a whole. Because of this change, Council now believes that it is more appropriate to fund footpaths in the same way we fund all roading work that attracts co-funding from Waka Kotahi, that is, at a District-wide level through the General Rate (70%) and the Uniform Annual General Charge (30%). At an operational level, every three years all footpaths in the District are condition rated, and replacement and maintenance needs are assessed on a quality and use basis.

Our current Policy however, limits the amount of work planned and carried out across the different communities based on the budget set, rather than the condition rating of the footpaths. This has mean that in some instances, smaller townships are receiving a lower level of service for footpaths, due to limited funding. This would likely continue if we do not amend this Policy.

What is the impact of the proposed change?

This change will mean that the cost of all footpaths will be spread across the whole District. This will mean an initial increase in rates for the areas currently charged the Rural Community Works and Services Rate, and a decrease in rates for those charged the Geraldine, Temuka and Timaru Community Works and Services Rate. This increase in rates for those in the rural areas will be matched by an increase in footpath replacement and maintenance in coming years, to lift the quality of these footpaths to match those in larger urban areas.

The table below shows the rates impact of the proposed amendment on sample properties across the District.