[Matthew Saunders]

Hi everyone,

I haven’t had anything to do with Special Rates before so haven’t put much thought into how they work until I was asked some information about them by my manager.

If anyone has any knowledge of special rates, could you let me know:

If we will be raising for example an additional $300,000 on top of our permissible income for a specific project by use of a special rate, will this require an application to IPART for a SRV; and

If we plan to impose the Special Rate for example on Residential properties only, and we already have a minimum rate for residential properties, can we charge the properties currently on the minimum rate the special rate as well, or are properties on the minimum rate exempt from paying a Special Rate?

Thank you,

Matthew.

[Cherie Muir]

Hey Matthew

Yep. If the income is above your permissible, you’d need a SRV special rate or not. If a council didn’t want to do a SRV they’d need to reduce other rates to make room for the special rate within their permissible pie.

No. Having a minimum rate already in place for impacted properties should not prevent the application of a special rate, but have a think about how you are going to structure the special rate from a simplicity point of view e.g. straight ad valorem, or with base, or with minimum. I’m pretty sure there are limitations on on the maximum base amount with special rates … $2? comes to mind, but if you end up going for SRV you could get approval for a higher base that way.

Take a look pg 32-34 of Revenue Raising Manual.

Good luck with it, Cherie.

[Andrew Butcher]

Hi Matthew
Completely agree with everything Cherie has said, the minimum for Special Rates is $2 however the Minister can determine another amount by instrument (Section 548(3)(b)).
The only limitation for a Special Rate is that it cannot fund Domestic Waste Management (Section 495).
If council’s proposal is to apply for an SV for a period of one or more years you will need to be mindful of the implications when it finishes, you will need to reduce your permissible by the $300k plus any general variation percentages applied each year to it.
Also, there are changes to special rates in the amendment Act that allow councils to apply a Special Rate without an IPART approved variation. They are limited to joint infrastructure projects with other levels of government.

Regards,
Andrew

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