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Local roads to benefit from change in legislation

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Council road worksLegislation passed in NSW Parliament earlier this month has provided the opportunity for MidCoast Council to apply for a Special Rate Variation, an important step forward in addressing the condition of the region’s transport network and Council’s ongoing financial sustainability.

The condition of roads and bridges has been highlighted by the local community as their highest priority.

But with an annual shortfall of $5million for funding depreciation of these assets, and a backlog currently sitting at $180million, increased funding is needed to address the region’s transport network.

With this in mind, a special rate variation (SRV) proposal was developed and taken to the MidCoast community late last year.

Now, in passing the Local Government Amendment (Rates - Merged Council Areas) Bill 2017, MidCoast Council has been given approval to proceed with submitting its SRV application.

The SRV proposal is for an increase of 5% (including the rate peg), each year over a 4 year period, along with the harmonisation of the environmental rate at 6% across the MidCoast local government area.

Should the application be approved, the SRV will come into effect from 1 July 2017.

“Being given the green light to proceed with the SRV application is a positive step forward and one that is endorsed by our community, who have consistently rated the condition of local roads in need of significant improvement as of the highest importance”, explains Glenn Handford, MidCoast Council’s Interim General Manager.

“In a survey conducted in November last year, over 75% of respondents supported a SRV at the proposed level or slightly lower, which pleasingly demonstrates the community’s understanding of our current position”.

When MidCoast Council was formed in May 2016, a critical initial priority was to consolidate the asset and financial position of the merged entity to determine a sustainable path forward for the community.

An investigation highlighted the extensive asset backlog for roads and bridges, along with underfunding of depreciation for roads and bridges by $5million annually, which until addressed, means the backlog of works will continue to increase.

“Since the merger, we have identified ongoing savings far exceeding the KPMG merger business case scenario.

By committing these merger savings to our roads and bridges, along with additional merger funding through the Stronger Communities – Major Projects Fund, a $30million Roadcare Program has been developed”, Glenn said.

“While this is a great result for a newly merged Council, it will not address depreciation or the significant backlog, which is where the SRV will be critical in making a positive difference”.

Potential issues around affordability of the SRV proposal and its impact on ratepayers formed an important part of the community consultation last November.

“The proposal includes a freeze on the waste levy for 3 years, which will provide a saving of $120 and assist in some way to offset the rate increase”, he said.

The average increase per year is $59 in the Manning region, $64 in the Great Lakes region, and $77 in the Gloucester region.

To find out more about the SRV proposal, visit www.midcoast.nsw.gov.au/SRV where information will continue to be updated as it becomes available.

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