Council confirms rates refunds after calculation cock-up

Hobsons Bay City Council has revealed that an ‘unintentional error’ in its rating process has resulted in rates increases of 2.28 per cent – .03 per cent higher than the permissible 2.25 per cent rate cap – with the Council to refund ratepayers an average 75 cents next year.

It was explained that the error was due to Council’s valuers returning supplementary rates for a number of properties in the last financial year after the new rates notices had been issued for the new financial year, meaning some rates refunds were not accounted for.

The total dollar figure from rates received for all properties within the municipality is used in the calculation of future rates, and therefore the recent rates notices issued were calculated using an incorrect total dollar amount from the previous financial year.

Strategic Development Director Tammi Rose said Council can receive information back from its valuers any time of year in relation to an objection, noting that in some instances they can take some time especially if they are complex.

“Council processes supplementary rates right through the year, at any point in time when the valuers return a supplementary rate in relation to a property. Property valuation objections are lodged within 60 days of the rate of notice,” she said.

“A valuer can take some months… many, many months in this case… to actually consider the objection from when it’s lodged after the rate notice and provide the information back to Council on their determination which is what happened in this case.”

Hobsons Bay City Council will refund ratepayers an average 75 cents after an ‘unintentional error’ in its rating process.

It was explained that while the overall overcharge was approximately $30,000, it averages out to about 75 cents per property based on the total number of properties rated, therefore the actual amount per property can vary.

Acting Corporate Services Director Roger Verwey said Council completed a cost-benefit analysis, looking at how much it would cost ratepayers to have their rates notices re-issued now as opposed to refund adjustments being applied to rates notices next year.

“We did a bit of a costing analysis and probably the most conservative estimate would probably be about $15,000, but it could go a lot higher than that. Sending out a rate notice alone is approximately $40,000, it could be higher,” he said.

Council officers determined that in the interest of reducing the impact on the community as a whole, to recommend Council consider applying the refund in the next financial year rather than re-issuing rates notices in the current financial year. The motion was carried.

It is expected Council will incur ‘immaterial non-compliance’ status with the Essential Services Commission for exceeding the rate cap, however it is understood Hobsons Bay City Council will not be the only council to incur such status.

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