FAQs about rates for 2024/25 year 1 of LTP 2024–34
A. Porirua City Council has to provide services and infrastructure for its 62,849 residents, but when compared to other cities with a similar population our size, we have considerably fewer ratepayers footing the bill. Porirua City Council has only 20,448 rateable properties to spread our costs over. A breakdown of the properties is provided below:
| Property type | |
|---|---|
| Residential | 18,747 |
| Rural | 649 |
| Business | 812 |
| Non rateable | 240 |
| 20,448 |
Therefore the same level of spending is shared among fewer people. Porirua also has fewer sources of income like airports, trusts, ports, property portfolios. In total 67% of Porirua’s cash revenue comes from rates compared with 47% on average across other councils in New Zealand.
Residents do want us to provide all our services and facilities and we are reluctant to reduce these without clear and strong direction from the community. The latest resident survey demonstrated 74% of residents were either very satisfied or satisfied with the public facilities provided and 63% of residents were either very satisfied or satisfied with Council’s overall services and facilities provided.
General rates relate to city-wide charges that everyone contributes towards. These are for services and facilities like libraries, parks, playgrounds, sports grounds, cemeteries, walkways, swimming pools, property, city events and public infrastructure. General rates are for services and facilities that are generally available, either directly or indirectly, to all ratepayers. These costs are shared across every ratepayer in the city.
Targeted rates relate to specific charges where those who directly use the services pay for theservices. Targeted rates include charges for drinking water, sewage disposal, recycling and city development. Targeted rates are set to fund a particular activity or service and they may be assessed on particular groups of ratepayers. For instance, residential and commercial ratepayers contribute to wastewater, drinking water, and sewage disposal costs. Rural ratepayers who are not connected to the city’s network do not pay for these costs.
Sometimes some of what our rates contribute to are often forgotten. All of the following examples rely on Council rates. When you turn your shower on in the morning, when you flush your toilet, when you drive to work, when you walk down to the park and play on a playground, or when you go down to one of the freshly mowed sportsfields. These are a few examples of the maintenance and ongoing upgrades Council undertakes to ensure you receive the services you expect from our city.
A. Council sets its budget every year and must manage its revenues, expenses, assets, liabilities, investments and general financial dealings prudently and in a manner that promotes the current and future interests of the community.
New activities, increased investment in infrastructure and the quality or quantity of our services – eg standards of our roading, rubbish collections – determine how much money the Council needs to collect. Unexpected demands like increased costs for insurance and unforeseen costs in response to emergency management and storms / flooding also add to annual rates increases.
The rates increase for 2024/25 is an average of 17.5% for existing residential properties. You can find out more:
- about how we set rates https://poriruacity.govt.nz/services/rates-property/rates/how-rates-are-decided
A. It is important to distinguish between the increases in rates revenue from year to year and the average rates increase. Our revenue increases reflect not only the impact of rates increases to the average existing ratepayer, but it also includes rates revenue received from the growth in new rateable properties each year – currently running around 0.9% per annum.
The total increase in rates in 2024/25 is 18.40% however the increase to existing ratepayers is 17.50%.
It is worth noting that the rate level of 17.50% is driven by our continual investment in infrastructure and the need to balance the budget by 2023/24. These contribute to the 17.50% as follows:
- general increase 5.13%
- infrastricture 8.51%
- balanced budget 3.86%
A. The table below shows the median rates increase of each rating category. Individual increases will vary based on the capital value of your property.
| Group |
Average increase |
Average increase $ |
Change per week in rates $ |
|---|---|---|---|
| Residential | |||
| Lower quartile | 17.77% | 692.20 | 13.31 |
| Median | 17.96% | 781.47 | 15.03 |
| Upper quartile | 18.17% | 908.99 | 17.48 |
| Vacant section | 17.17% | 391.00 | 7.52 |
| Other groups | |||
|
Rural (less than 50 hectares) |
18.07% | 989.78 | 19.03 |
|
Rural (50 hectares & greater) |
18.10% | 1,015.63 | 19.53 |
| Hongoeka community | 15.44% | 306.46 | 5.89 |
| Commercial | 18.16% | 2,154.36 | 41.43 |
| Industrial | 18.22% | 2,351.51 | 45.22 |
| Motels | 14.14% | 4,591.06 | 88.29 |
| Shopping plaza | 17.38% | 29,675.98 | 570.69 |
|
Vacant land/ derelict building |
55.50% | 3,735.07 | 71.83 |
A. We have also included a table that provides a comparison between our different rating categories. The table below relates to a property with a capital valuation of $1.3 million. The table provides an estimate of rates for 2024/25 as a percentage of capital value.
| Group | Capital value | General rates | Targeted rates * | Total rates |
General rates as a % of CV |
Total rates as a % of CV |
|---|---|---|---|---|---|---|
| Residential | $1,300,000 | $5,491 | $1,590 | $7,081 | 0.42% | 0.54% |
| Rural | $1,300,000 | $4,478 | $0 | $4,478 | 0.34% | 0.34% |
| Farming | $1,300,000 | $3,971 | $0 | $3,971 | 0.31% | 0.31% |
| Commercial | $1,300,000 | $16,129 | $2,470 | $18,600 | 1.24% | 1.43% |
| Motels | $1,300,000 | $7,619 | $15,989 | $23,608 | 0.59% | 1.82% |
| Shopping plaza | $1,300,000 | $16,979 | $23,098 | $40,078 | 1.31% | 3.08% |
|
Vacant land/ derelict buildings |
$1,300,000 | $23,222 | $2,470 | $25,692 | 1.79% | 1.98% |
*Targeted rates include kerbside recycling, water, city development, uniform annual general charge and sewage.
Q7. What does rating for depreciation mean?
A. The current and future ratepayers each pay their fair share of the cost of the Council’s assets (eg water, wastewater, stormwater and roading assets) over the assets’ useful lives, so that the replacement costs are met by those ratepayers who have benefited from these assets. If current and future ratepayers do not each pay for their share, then an unfair debt burden will be placed on the other group.
Q8. What does having a balanced budget mean?
A. Having a balanced budget means Council’s spending matches its income and so doesn’t create a deficit that needs to be funded by future generations.
In the LTP 2024–34, we extended balancing the budget, meaning we won’t balance the budget until 2026/27 otherwise rate increases for 2024/25 would have been higher than 23.0%.
Q9. How do you calculate the share each ratepayer has to pay?
A. Each rating unit (or property) is placed within a differential rating category, based on land use. Rates are calculated using these differentials. Differentials can be viewed as the percentage share each rating category pays. For example for every $1 a residential ratepayer pays in general rates, rural ratepayers will pay 80 cents and business ratepayers will pay $3.10.
|
Categories and groups |
Factor 2024/25 |
Rates revenue including GST 2024/25 |
|---|---|---|
| Residential | ||
| Group 01 – Residential and other | 1.00 | $ 63,729,488 |
| Commercial | ||
| Group 13 – Business | 3.10 | $ 17,570,355 |
| Group 15 – Motels | 1.42 | $ 146,059 |
| Group 16 – Shopping plazas | 3.10 | $ 2,944,911 |
| Group 17 – Vacant land /derelict buildings | 4.5 | $ 16,396 |
| Rural | ||
| Group 19 – Rural (less than 50 hectares) | 0.8 | $ 3,326,550 |
| Group 20 – Rural (50 hectares or greater) | 0.7 | $ 498,508 |
| Group 21 – Rural (Hongoeka community) | 0.7 | $ 91,943 |
Rates are calculated using the capital value of your property in relation to the total capital value of your rating category’s values. This will give your share of your rating category’s general rates.
For further detail on how we set our rates, refer to our Funding Impact Statement.
Q10. What do general rates pay for?
A. The general rates needed to support the city in 2024/25 rating year are projected at $88,325,000.
This amount is made up as follows:
The total general rates are then charged to each of the rating categories based on each category’s share of differential and total capital value. A breakdown of each rating category’s share of the general rates is provided below:
Targeted rates are charged directly to end-users and are not included in general rates. There is a small amount of wastewater and drinking water charges that are included in the general rates. These amounts are determined by looking at the public infrastructure needed to support the city, which all ratepayers should pay a share of.
A. The following table shows the projected annual average rates increase for the life of the Long-term Plan 2024–34.
A. The Council contracts Quotable Value to perform property revaluations every three years. The last revaluation was as at 1 October 2022. Quotable Value determines the value of your property by looking at the selling price of similar properties in the area. Valuations do not include chattels, such as carpets, drapes or light fittings.
Q13. Can we receive our rates bills via email?
A. Yes. Simply email [email protected] advising them that you would like to have your rates invoices emailed, detailing the property account number or address and confirming the email address to be used.
