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Community board submits opposition to targeted rates

June 28th, 2010

The Motueka Community Board has put forward a submission to central government on the Local Government Act 2002 Amendment Bill, opposing the proposed clarification to allow Councils to fund Community Boards through targeted rates.

If adopted, the "proposed clarification" would mean that Motueka ward residents would have to pay a sanctioned extra rate, targeted at them only, to pay for the operation and administration of their community board. The Board, through chairman David Ogilvie, insists that its administration and governance costs should be funded through the General Rate.

Since the Tasman District Council controversially imposed a targeted rate for community boards, ratepayers have been charged for administration at high rates which the Council calls "charge-out costs".

The Golden Bay Community Board, through its chairman Joe Bell, has recently made strong public representations to Tasman District Council on this issue, which affects their ward.

Tasman District Council has also made a submission but with the opposite viewpoint. It says: "The Council supports .... clause 45 that councils can fund community boards through targeted rates. Tasman District has five wards .... The three wards that do not have community boards do not want to pay for the wards that do have them.The ability to use targeted rates funding for those communities with community boards satisfies this concern."

Motueka Community Board's submission is as follows:

While we acknowledge the potential benefits arising from having Community Board driven projects funded through targeted rating, we oppose the imposition of targeted rating to fund the governance and basic administration of Community Boards. Administration and governance costs should be funded through the General Rate. Anything else will, as it has in Tasman District, create strains between Council and communities with Community Boards.

Please note that a clear distinction needs to be made between projects, as opposed to administration and governance. In a diverse area like the Tasman District, targeted rates are increasingly being used to fund diverse, community-specific projects - the costs largely fall where they lie. However, no such geographical distinctions are imposed upon the funding of Council governance and administration, except when it comes to areas with community boards. Community boards are a structural feature of Council. Ratepayers in areas with community boards should not be singled out for extra costs.

Community boards are not community associations. Community boards are defined by the 2002 Local Government Act. The LGA sets out the definition of the legal status, purpose, and powers of community boards, as well as territorial authorities responsibilities regarding community boards. Community boards should be funded in the same way as the rest of Council governance and administration.

Since the Tasman District Council controversially imposed a targeted rate for community boards following a split vote, ratepayers have been charged for administration at rates which the Council calls "charge-out costs". This implies that community boards are separate from Council.

These charge-out costs include:
  - hourly charges of $336 for the CEO's time.
  - $172 per hour for a Council manager.
  - $70 per hour for a minute secretary.
  - 10c per page for photocopying agendas and minutes.
  - $400 per month to 'cover the costs of elections'.

The CEO's hourly rate, if applied to a 40 hour week, comes to $13,440 per week. This weekly total is only $1,060 less than the median annual income in Motueka. Over 52 weeks, the CEO's fees would total $698,880.

A year of 40 hour weeks for a manager would cost $357,760, the minute secretary $145,600, ten times Motueka's media annual income of $14,500.

These charges are a vivid example of the unfair use of a targeted rate for community board administration, and of treating community boards as a separate or external entity from Council. We hope Central Government would not vindicate such a move.

If Central Government was to sanction the imposition of targeted rates to fund the basic operating costs of community boards, it would be sending the message that community boards are a separate entity from their parent councils. The Local Government Act does not support such a stance. Community boards exist under the wing of council and should not be treated differently when it comes to funding basic operations.

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