2007/2008 FINANCIAL YEAR BUDGET
MAYOR’S FULL BUDGET REPORT I am pleased to present the 2007/2008 financial year’s budget for Calliope Shire, which I hope is not the Shire’s last budget. As ratepayers would expect it remains a balanced and responsible budget. Whilst the future of the Shire remains under the threat of amalgamation, Council has proceeded to implement its strategic plan for the Shire. Ratepayers should expect nothing less from us in this regard. The Council Cost Index as published by the Local Government Association of Queensland for the 12 month period to December 2006 was 4.5% however in road and bridge construction the figure is 7.1%. The general wage increase for staff under the Enterprise Bargaining Agreement is 5%. In addition, internal staff will commence working an additional 30 minutes a day from July 2007 in accordance with their Enterprise Bargaining Agreement. This has a further 6% impact on costs.
GENERAL RATES As ratepayers would already be aware new valuations apply from the 1 July, 2007. The Shire’s rateable value has increased by 54% since the last valuation. Average residential values across the Shire increased by a similar amount. The following summarises the situation:-
A few years ago the Department of Natural Resources introduced annual revaluations to overcome what they termed were “wild fluctuations” in valuations under the old 7 year revaluation cycle. Revaluations are now completed every two years, however they have clearly failed to address the “wild fluctuations” issue. The 10% rate cap policy of this Council remains the only successful way of smoothing out the impact of such wild fluctuations. It remains in place in the current budget as does the policy that properties that change ownership during the previous year do not have the benefit of the rate cap. General rates in 2006/07 which were struck on the superseded valuations were:-
The proposed rating structure for 2007/08 is as follows:-
The change in terminology simply reflects the change in terminology used in the new planning scheme adopted on the 13th April 2007. The rate cap will apply to 3896 properties or 55% of properties. Properties throughout both the urban and rural sectors will benefit from the rate cap.
LACK OF LAND FOR DEVELOPMENT IN THE BOYNE TANNUM COMMUNITY – AT CRISIS POINT As ratepayers would be aware the Council has been pressuring the State Government for the last 5 years to release State owned land in Boyne Tannum which is capable of creating over 700 lots for residential development. We have been continually warning them that failure to do so would cause a major land shortage in the near future. That time has now arrived. By December this year Council expects that the land bank in this community will be zero. This not only has a huge impact on housing availability in the region but also on land affordability. The announcement of the Rio Tinto expansion project this week means that we now face a crisis situation. The State Government kept telling us that pre existing native title rights was the impediment to having the land released. Consequently, Council took the issue up directly with the native title claimants and last year we successfully negotiated a memorandum of understanding with them. This was rejected by the State who said that they propose to negotiate directly with the native title claimants with a view to having the land ultimately released to the commercial land development industry. Council understands that the State is yet to commence negotiations with the claimants. This lack of land supply in the Boyne Tannum community also impacts on costs of other infrastructure provision to the community. An excellent example is the new sewerage treatment plant at Tannum Sands which has been built at a cost of $23M to service anticipated growth in the area. If that growth is impeded then existing consumers will pay more in sewerage charges. It is a vicious cycle. Council now must look past the State Government to resolve the crisis that their inaction has caused. Council believes that there are only two major residential development nodes that can address this land shortage in the short term. The first is at Tannum Waters which is located behind the Broadacres area. The developers are expected to commence Stage one of their residential subdivision in the current financial year. The second is for Council to develop a significant portion of the 20 hectare lot it owns at the corner of Tannum Sands Road and Centenary Drive. Council purchased this land in 2000 and consultants developed a town centre plan over the site which incorporated shopping facilities, residential development, motel/convention centre and a multi-sports complex on the site. Since that time, the Tannum Sands shopping complex has been constructed opposite this site. In addition, Council has purchased over 300 hectares of land which surrounds the Tannum Sands sewerage treatment plant site. Part of this site has been identified for the development of sporting fields which Council is proposing to commence in the ensuing year. This site would also be suitable for other major recreation facilities such as an indoor sports complex. Access to this site will be significantly enhanced with the construction of the second bridge across the Boyne River, but more about that shortly. Accordingly, Council will ask its consultants to review the master plan for its 20 hectare site as a matter of urgency with a view to maximizing the residential use of the site. Council will then proceed to develop the site in accordance with the new plan with the primary objective of relieving the short term residential accommodation shortage in Boyne Tannum. The development of this land together with that at Tannum Waters will further increase the need for the second bridge over the Boyne River. Council’s strategic road network plan suggests that the bridge will be required as early as 2012. The difficulty is that the bridge will cost in excess of $10M to build. Council believes that profits from the development of its 20 hectare site has the capacity to substantially (if not fully) fund this project. In anticipation of this, Council will commence preliminary planning for the second bridge crossing over the Boyne River in this financial year.
CAPITAL PROJECTS OTHER THAN ROADWORKS Whilst roadworks remain a major focus of this budget other significant projects identified in Council’s corporate plan will be undertaken in the 2007/08 year. 1. $500,000 to convert the current Calliope library complex into a community centre including kitchen, bar and toilets similar to the Boyne Tannum Community Centre. 2. $145,000 to extend the carparks to serve the expanded Calliope Administration Centre and the redeveloped Calliope Community Centre complex. 3. $200,000 to construct a transfer station at the front end of the Benaraby tip so that the public do not need to go to the tip face. This will address a number of safety concerns with the public interacting with heavy equipment at the tip face. 4. $1,750,000 to complete the purchase of land adjoining the Benaraby landfill. The facility will not only have a life of over 200 years as a regional landfill but the purchase will ensure that the landfill has a significant buffer from other land uses. 5. $700,000 for new cell construction at the Benaraby landfill. 6. $1,500,000 for Stage 1 of the relocation of the BITS sporting fields to Tannum Sands now that formal contracts for the BITS redevelopment have been executed with the development proponents. 7. $50,000 at the crematorium for a pedestrian bridge link across the lake connecting the carpark to the cemetery.
GARBAGE COLLECTION CHARGES The budget provides for a modest increase of $8 per annum in the standard two bin 240 litre domestic service. The waste audit conducted recently revealed a lower than anticipated amount of refuse in the 140 litre bins. Less rubbish being placed in these bins means a cost saving to Council in disposing of the waste at landfill. Accordingly, Council is returning this benefit to consumers by reducing the service fee on a 140 litre bin from $166 to $164 for the 2007/08 year. For residents with a 240 litre bin this means that by moving to the 140 litre bin they can not only avoid the $8 rise but save a further $2 as well. Proposed charges are as follows:-
SEWERAGE CHARGES Domestic sewerage charges which apply to the Boyne Tannum and Calliope communities will be a uniform $425 per annum. This is an increase of $28 per annum for most consumers. The new $23M Tannum Sands Sewerage Treatment plant will be completed in August. Currently waste water from the Boyne Island Sewerage Treatment Plant is irrigated on the BITS golf course as well as on the Dennis park sports fields. Any excess is disposed of under an environmental license in the QAL Red Mud Dam ponds. Initially it was planned to simply connect the new plant to the existing waste water network whilst alternative reuse options were investigated. Council now plans to fast track this work and proposes to implement a reuse program through growing trees on most of the 300 hectare site within the next twelve months. Whilst this will increase capital costs by some $2m it will provide an environmentally sustainable solution to waste water disposal sooner than planned. Environmental approvals are now in place to expand the existing Calliope Sewerage treatment plant from a 2000 person plant to a 6000 person plant. The effluent will continue to be irrigated on the Calliope Golf Course. Tenders for this $4M project are expected to be awarded by the end of December 2007 with completion expected by June 2008.
WATER CHARGES Council operates a two part tariff system for water charges. ie 1. A base charge or a fixed cost component which meets the costs that are incurred independently from the use of the system eg. (a) Capital cost of mains and reservoirs (b) Operation and maintenance of network (c) Administration and engineering costs (d) Asset depreciation and replacement (e) Water losses eg fire service, meter error, leaks, mains scouring.
As such this charge applies to all connected and vacant land within the water scheme area. 2. A consumption charge or variable cost component which meets the actual costs which Council incurs in purchasing water from the Gladstone Area Water Board. This charge is based on the volume of water consumed. The base charge for all consumers connected to the Lake Awoonga treated water reticulation system for the 2007/08 financial year will be $198 which is an increase of $24 per annum from the base charge in 2006/07. The water consumption charge for all services connected to the Lake Awoonga supply was $1.24 per kilolitre in 2006/07. The Gladstone Area Water Board has advised that this charge will be $1.28 per kilolitre in 2007/08. The only water scheme operated by Council outside the Lake Awoonga/Gladstone Area Water Board supply system is in Builyan. In January this year the bores that supply Builyan failed and potable water has had to be carted to the town from Calliope since that time. Even with the 75% State Government assistance grant this still costs Council $7.91 a kilolitre to supplement the bore supply. When the bores failed Council introduced very tough water restrictions on Builyan residents which remain to this day. Residents are restricted to 100 litres of water per resident per day. Over recent years a number of test bores were dug in and around the town to access a better supply for the town. All these efforts failed. Council came to the tough conclusion in January this year that the only economical way of providing water to this small community was to revert to rain water tanks. This would place the residents of Builyan in the same position as residents in the nearby towns of Many Peaks, Ubobo and Nagoorin. In January 2007 Council offered Builyan residents the opportunity to withdraw from the reticulation scheme and offered a rebate of $1500 per property to assist with the installation of tanks on their property. This was in addition to the $1000 rebate offered by the State Government. These two rebates basically pay for a 25,000 litre tank. In addition, Council offered to meet any additional costs associated with the installation which would be recovered by Council by a special rate over a five year period. 16 property owners have now committed to withdraw from the scheme which leaves 38 properties still connected. In introducing the alternative scheme Council advised residents that should they remain on the reticulated scheme beyond the 30th June 2007 they would be asked to meet the full cost of providing water to them. Accordingly the charges for the remaining residents connected to the Builyan scheme for the 2007/08 year will be as follows:- Fixed Charge $1,359 per annum [standard 20mm domestic connection]. Consumption Charge:- (a) From bores only $1.61 a kilolitre (b) From a combination of bores and water carted from Calliope with Government subsidy $7.91 a kilolitre. (c) From a combination of bores and water carted from Calliope with no Government subsidy $27.24 a kilolitre. The consumption charge will be applied on a per four month billing period. For example:-
ROADS Roads continue to be a major focus for Council with $2.2m allocated to the maintenance of rural roads and $562,000 for the maintenance of urban streets. This year Council has doubled its commitment to the asphalt resealing program in urban streets from $500,000 to $1M. The budget provides for a $6.755m in capital projects on roads, making Council’s total commitment to road maintenance and improvements $10.517M. This includes the following specific projects:-
SUMMARY The $48.5M budget which Council places before the community provides for a significant capital works program in all areas of Council’s operation consistent with the Shire’s strategic plan. This has been achieved with a modest increase in rates and charges. General rates will increase between zero and 10% (the rate cap) depending on the individual valuation change. The average total increase in charges for garbage, sewerage and water in urban areas is $60 per annum or $1.15 per week. Residents who opt to change to the 140 litre bin can reduce this increase to $50 per annum or 96c per week. Builyan residents can avoid the huge cost involved in carting water from Calliope, by opting to transfer back to a tank water supply. The budget is environmentally responsible in that ratepayers are encouraged to opt for a smaller bin as well as the proposal to bring forward the effluent reuse system for the new Tannum Sands Sewerage Treatment Plant. The proposal to develop Council owned land at Tannum Sands and allocate the profits to the second bridge across the Boyne River has two major economic positives in that:-
I commend this responsible and visionary budget to our community.
CR GEORGE CREED, OAM MAYOR |
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