COLLIE Shire Council is set to increase rates by 6.82 per cent.
The sharp increase is due to changes in the way the Western Australian Grants Commission distributes its funding pool.
Higher water and electricity charges are adding to the council’s budget agonies.
About 12 inland councils council have been hit hard and the money they have lost has been allocated to high-growth coastal areas, shire councillors were told at their budget meeting on Tuesday night.
The shire’s finance manager Colin Young said the grants committee has developed a new methodology for distributing the multi-purpose grants.
This new methodology is expected to cost the Collie council $800,000 over the next four years.
This year council’s grants are expected to be reduced by $200,000,said Mr Young.
This equates to about an additional 5 per cent rate rise to cover the cost.
Increases to the funding pool over the period will only partly compensate for the loss, Mr Young said.
Higher water and electricity charges have added to the council’s grant woes.
Consistent with recent years, the government has announced an increase in water costs of 6 per cent,Mr Young reported.
There is expected to be a 5 per cent increase in street lighting and 3.5 per cent increase in general tariffs.
This will be combined with an estimated extra increase of 9.5 per cent due to the carbon tax on electricity tariffs.
Projections indicate a $45,376 greater cost to council than the 2011/12 financial year.
This equates to approximately an additional 1.09 per cent rate rise.
Tomorrow a council delegation will travel to Perth to forcefully appeal for a change in the grants commission’s decision.
But Tuesday night’s planning did not count on any about-face in Perth. An earlier written submission had been rejected.
Instead, councillors spent several hours wrangling the figures, dropping or reducing allocations to planned projects, then waited as officers worked on a spreadsheet to see the effect on rates.
If they had not taken a razor to the draft budget, the rise could have been 12 or 13 per cent, said shire president Cr Wayne Sanford after the meeting.
Even coastal growth area councils, which were to get more grant funding, were increasing rates to cover rising costs.
Dardanup, which is getting more grant money, is upping its rates by eight per cent, Capel is to increase its rate by at least seven per cent and Bunbury by 5.95 per cent.
Griffin Energy’s ongoing legal battle against the valuation placed on the Bluewaters Power Station has skewed the grant allocation to Collie.
On paper the council should be getting about $500,000 a year from the power station. It has budgeted for only $150,000 (paid by Griffin in 2009/10 and 2011/12) as the company’s objection to the Valuer-General’s Office drags on.
The draft 2012/13 budget will be available to the public so individuals or groups can comment before its adoption.
Cr Sanford said the budget would be available on the council website or a copy could be obtained by contacting the council office on 9734 9000.
If people would like to get a copy of the draft and make some comments that would be great,he said.
Comments would need to be submitted to the finance manager Colin Young prior to Wednesday, July 25.
Any comments will be reported to the council meeting endorsing the budget.We will give any comments received consideration,Cr Sanford added.
