A 76 per cent increase in council rates is now on the table for residents of Yass, Murrumbateman and Sutton, in New South Wales, after Yass Valley Council voted to put a special rate variation out for community feedback.
The motion passed 5-4 at an extraordinary meeting called on Wednesday to address the council's financial position.
Independent consultants found that the council would need to generate an extra $8.3 million from operations each year by 2027-28 to maintain its financial and infrastructure position.
The decision starts six weeks of consultation, during which three financial options go to the public. All three would result in a cumulative 76 per cent increase over four years. They differ in how the increases are staged.
The mayor, Jasmin Jones, stressed that the council had not decided to approve the rise. "It was a decision to go out to our community for the next six weeks to put our boots on the ground, to get that really robust feedback from our community," she said.
Any variation would also need the approval of the NSW Independent Pricing and Regulatory Tribunal.
Speaking to 666 ABC Canberra, Cr Jones agreed that 76 per cent sounded like "a lot". "But that is the structural financial correction that is happening across New South Wales right now," she said.
"Yass Valley Council is certainly not alone in the need to go for a special rate variation at least once every 10 years," she said.
She pushed back against the suggestion that the council had mismanaged its finances. "I think it's fair to say that if every rural council is going for a special rate variation every 10 years, that tells you that there's a structural problem in how councils are funded," she said.
The constraint she pointed to is the rate peg, the annual limit on how much a council may raise rates. "Our rate peg only allows us to put up rates every year - for example, 3.4 per cent or 3.7 or 3.9 - when the cost of materials skyrocketed, for example, during the diesel crisis," she said.
Asked about the council's decision to invest in a new building, which has drawn criticism locally, Cr Jones said the old workplace "wasn't fit for purpose - we had people's chairs actually falling through the floor, it was beyond redeeming that particular building". She also conceded that the council was struggling to keep up with road maintenance.
The council's chief executive, Gayleen Burley, said the issue was an emotive one for people struggling with costs, and that the council had "compassionate debt recovery services" and wanted to engage with residents early.
The consultation is the part that deserves attention, because it is unusually generous. Ratepayers are not being asked whether rates should rise by 76 per cent. They are being offered three ways of doing it.
This newspaper has compared the three. The first reaches 76 per cent. The second reaches 76 per cent. The third reaches 76 per cent. The difference between them is the order of the years.
Robust feedback is therefore assured. Whatever the community says over the next six weeks, the total is already known, which removes from the exercise the single largest source of uncertainty in public consultation.
The rate peg completes the design. It permits increases of 3.4, 3.7 or 3.9 per cent in a given year, which holds rates down in every year except the ones in which a special rate variation arrives, and the mayor says rural councils need one of those at least once a decade.
The Department of Unnecessary Research has worked through the implication and finds it reassuring. Averaged across the ten years, the peg is holding. The 76 per cent is simply the portion of the average that has to be collected in person.