An interesting Ratepayers Response to The Association's Submission to LCC

A Background Note: Launceston has a ratepayer who pays rates in various constituencies and is therefore qualified to make comparisons between LCC's performance and rating priorities and their experiences with other councils elsewhere in Australia and the UK.

To quote "Greetings from England, and CONGRATULATIONS! A most commendable submission, and we most fervently trust there is a substantial and meaningful response.

As a matter of interest, in the county of Wiltshire, re-cycling is a big issue: it is let to a private contractor for sale/disposal; many 'free' household re-cycle centres have been set up on the outskirts of towns, in which every conceivable type of waste is collected and sorted; from electronic, green garden, household etc. etc.. ratepayers are most supportive, and a visit to such places has become almost a social event!

However the general drift of your submission is worthy of adaption to a world wide context; I'll not launch into similar situations that could be observed here! Local rates are being kept exactly the same level as last year, in response to central government demands for economies.

Cheers, Susan and Mike "

Launceston ratepayers can only dream of anything like the experiences of their UK sisters and brothers being theirs too!

LCC's New Consultation Policy Looks More and More Cynical

In the end this idea that the ratepayers should be consulted about their rates now has all the signs of being a relatively cynical exercise. If you have any experience in bureaucracy at all you know that you NEVER go into a meeting unless you already know what the outcome will be. We should have seen this one coming.

Launceston City Council's GM, Robert Dobrzynski, advocated the process and he received some aldermanic resistance ... surprise surprise. There are a number of Aldermen that harbour the idea that ratepayers gave up all interest in the management of council and the city when the polls were declared. Has anyone met a ratepayer like that?

On the face of it Mr. Dobrzynski needed to be congratulated for his stance that gave ratepayers a louder voice and the association did congratulate him. BUT it is a different story once the submission process is over. It is unclear what is being done with or about the submissions that came from the process. Filtered one suspects. This is an unfolding story and it looks like the picture is less and less pretty as time passes .

Interestingly Ald. Ball was a strong advocate for the process and true to form he delivered some impassioned rhetoric on the subject. There were two meetings and both were poorly attended. Curiously, Ald. Ball was not at either of the meetings he was such a passionate advocate for and neither was he an apology for either of them. The title "Alderman Bandwagon" does seem to have something to it and increasingly so.

Ald. Ball as an alderman has complex views on many things and he is a vociferous advocate too. At the last council meeting there was yet another example of his complexity in action. The matter under consideration was the removal of a dangerous tree but it seems that Ald. Ball was sticking up for its retention. Anyone who read the article in The Examiner could see that this tree needed to be removed but there was a bandwagon to jump on here and it seems Ald. Ball just couldn't resist .... click here to read the story

To return to the rates issue in Launceston, it is going to be interesting to see who jumps where but one suspects all the jumping will be done as they say "in camera." Its odds on that nothing much will change from the original proposition. The same old, same old reigns supreme, so watch this space! It would be very nice to be wrong for a change!

COUNCIL PERFORMANCE INDICATORS

Well it has to be said that Frank Dean hits the nail on the head. North Midlands' Councilors have behaved better than many other Council and demonstrated some constraint. What is often noticeable for Council budgets in general terms is that they typically increase at a rate in excess of the CPI.

If you ask an officer why this is so and you'll get a load of blah blah blah blah AND your bull dust alarm will ring very early in the conversation. Ask an Alderman/Councilor and you'll typically get officer generated bureau babble spouted at you and something along the lines that it is hard to blah blah blah blah AND your bull dust alarm will ring very loudly again.

What we all need to understand is that largely council officers are:

• very good at spending ratepayers' money;
• often not all that good at accountability
  
• good at ensuring that their salaries and superannuation continually rise without too much performance assessment interfering; and
• not at all good at devising alternative income opportunities to relieve ratepayers' rate bills – waste management versus resource recovery being a very good example.

Aldermen and Councillors need to hold their officers more accountable and ensure that they diligently carry out Council policy. They should also be subjected to regular tests that will tell ratepayers just how well they have performed against a set of standards.

Launceston City Council's 2011-2012 rate striking process

The General Manager's initiative to consult with Launceston's ratepayers in regard to the striking of the annual rate before it was actually struck was unwelcomed by three Aldermen but wholeheartedly endorsed by the city's Ratepayer's Association. Does that tell you anything?

Well the Association has taken the opportunity to make a submission to Council on the subject, so let's see where that goes. Ratepayers write to the press and one imagines that the bureaucrats at Town Hall will disregard them as will many Aldermen. The bureaucrats seem to think that more of the same will do it for them – it has up to now. They'll predictably be fighting for the status quo – unless there has been a mind shattering shift in their sentiments – and all the consultation will look like just so much window dressing.

Typically 'community consultation' in Launceston involves bureaucrats telling ratepayers and residents what is good for them rather than an opportunity to listen to them and to take on board new information.

The cynics seem to be finding indicators that the process here was less genuine than it might have been and has been presented as. If ratepayers are treated like mushrooms, and in the past they have been, their cynicism should have been expected. The test will be when the rate is struck! Let us see if there is indeed an effort to be more equitable and better financial managers.

CLICK HERE TO READ THE RATEPAYERS' ASSOCIATION SUBMISSION TO COUNCIL

The Absurdity of AAV for calculating Municipal Rates _ Letter to Mayor & Aldermen

The Tasmanian Ratepayers Assoc. has written to Launceston's Mayor a Aldermen – copied below – and to date for whatever reason there has been only been one Alderman who has seen a need to responded to the correspondence ... click here to read the thread of correspondence

WED JUNE 8 2011
Mayor and Aldermen,
Launceston City Council.

The Tasmanian Ratepayers Association Inc is indebted to Leo Foley for preparing this interesting piece. Launceston City Council is NOT obliged to use the AAV system in establishing its rates. The legislation clearly allows Launceston to select another of the alternative methods. It has long been recognized at Local and State Government levels that AAV should be abandoned as it is unjust and bears an inequitable basis for rating.

The State Government PROMISED Tasmanians that this system would be abandoned by LEGISLATION but this milestone has not yet been reached and the latest promise is by about November this year. This is extremely disappointing, given the hardship created the last time Launceston was previously revalued and now to be again repeated with the new valuation notices distributed a week or so ago.

Launceston could CHOOSE to use the Land Valuation figure to levy its rate, so why not ACT NOW ??

Launceston could also CHOOSE to limit or cap its rates for residential properties, so why not ACT NOW ??

Since 2006, there have been replacement Aldermen elected to Launceston City Council, all promising REFORM ON RATING, so why hasn’t this occurred ?

In 2011, there will be another election.

PLEASE, PLEASE now consider a different rating system. Don’t repeat the old system. Capping increases at 20% IS AN EXTRAORDINARY INSULT to ratepayers, as clearly that means many many ratepayers will pay less, pay no more, or pay less than the 4% increase expected across the board.

We look forward to receiving individual responses from each and every Alderman.

Yours sincerely,
Lionel Morrell
President
Tasmanian Ratepayers Association Inc.
Tel. 6331 6144

"Absurdity of Rating Improvements (AAV) We descend from a long history of destructive property taxes!
Windows were taxed in the UK, so people boarded up their windows, making them ill!
France had its chimney tax, so people boarded them up too, smoking residents to death.
In the UK Midlands, a capital improvements tax led to the de-roofing of buildings. Absurd? Of course; but – should we laugh at our forebears? Are we any wiser?
Under Assessed Annual Value (AAV), anyone who erects a dwelling is penalized ! Then, the homeowner is penalized again whenever they improve their property. Add a room – up go the rates! Establish paths—up go the rates! Build a garage – up go the rates! AAV not only taxes chimneys and windows, it taxes the whole house!
Property value consists of two separate parts: 1. the land value itself; and 2. the value of the buildings and other improvements made by the owner. •
The AAV system fails to distinguish between the value of these separate parts. Rates are levied on the property as a whole – on land and all improvements.
Land gets its value from the efforts of the whole community, not any one individual. Under a principled system of rating, property owners would pay in proportion to the value given to their sites by the community (ie on land value), not according to the value of their own improvements.
Some of the inefficient consequences of AAV are:

1. AAV penalizes the industrious homeowner, thus discouraging improvements. Those who renovate find that they must pay higher rates for their efforts.
2. AAV is arbitrary and unjust. The system bears little relationship to services rendered by the local authority.
3. Under AAV, rates are borne disproportionately on developed properties, compared to vacant land. It costs nearly as much to maintain a road past a vacant property as it does to maintain that road past an improved one.
4. AAV encourages the holding of land for speculative purposes. There is a lesser levy payable for holding land idle, than for using it.
5. AAV rating is inequitable. Owners who build on their land are liable for a higher proportion of the income of the municipality than the owners of underdeveloped land, although the services offered to each by the council are identical.
6. AAV has no moral basis. Not only does it fail to distinguish between land and improvements,
7. AAV is a nominal figure only. It is the rent which a property might return to the owner. Since most homeowners do not rent out their house, it has no true basis.

Land differs from every other form of property. It is nature’s free gift to all of us. When a person builds a house, the house is their private property because they built it. It does not belong to the community, and the community has no right to the house or its value.

Do we, as a society, need more houses?
Yes! We need to house our young families. So, don’t penalize people for building them! Infill development should not be penalized by higher rates, but encouraged by the need to derive income from sites in order to cover the rates thereon.
When ratepayers know that the council will charge them rates only on the value of their sites and not on the value of their homes or other improvements, they respond by becoming improvement-minded. The building and construction industries are stimulated, and a higher level of activity is maintained.
The Local Government Act 1993, gives the option of using one of three rating systems to Tasmanian councils: S 90 (3) A general rate is to be based on one of the following categories of values of land: (a) the land value of the land; (b) the capital value of the land; (c) the assessed annual value of the land (including improvements). In Tasmania, all municipal councils opt to levy rates on the AAV method. By comparison, all municipal councils in NSW and Queensland levy rates on the ‘Land Value’ method. Most ratepayer polls around Australia have found a majority favour the ‘Land Value’ method.
Why should ratepayers be faced with the worst system? Insist on your rates being based on land values only!

Posted in Economics, Local government, Rates « Are higher house prices good for society? Is ‘User-Pays’ fair? »

TASMANIAN RATEPAYERS CONGRATULATE LAUNCESTON'S GM

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