Business rates remissions delayed on Auditor-General's advice
Implementation of Rotorua District Council's rates remission guidelines for reducing the impact of the recent change to a capital value rating system on a number of businesses has been delayed following advice from the Office of the Auditor General.
The council had sought the views of the government's Auditor-General on its proposal and a response was received late last week.
Rotorua District Council chief executive Peter Guerin said that the Auditor-General had told the council it was advisable to undertake a formal public consultation process before proceeding with implementation of its business rates remission arrangements.
While this recommendation is at variance with the independent legal advice already obtained by the council, the prudent action for us now is to follow the suggestion of the Auditor-General and go through a formal consultation programme.
It does mean a frustrating delay, but it is important from a process perspective that we get it absolutely right from the beginning with every i' dotted and 't' crossed.
"It's arguable that the council could potentially be at risk of legal challenge to its decision if we didn't undertake the special consultative procedure set out in the Local Government Act.
Unfortunately this process will delay a final decision and the implementation of remission guidelines by around six weeks.
Mr Guerin said a report would be on the agenda of the council meeting on Thursday (16 August) so that the council could adopt a formal statement of proposal' about guidelines for business rates remissions for businesses identified as most affected by the change to capital rating. The proposal would then be released for public consultation over a period of a month.
At the end of the consultation period the mayor and councillors will hold a hearing for verbal submitters and will then meet to go through all submissions received. At that point they will be in a position to formally adopt guidelines for business rates submissions and their decision can then be implemented without further delay.
Rotorua Chamber of Commerce chief executive Roger Gordon said he shared the council's frustration at the delay but accepted that plans to undertake a formal public consultation process were responsible and appropriate given the advice of the Office of the Auditor-General.
This process will ensure that the council's decisions around guidelines for business rates remissions are safe from legal challenge, and that's critical to ensure certainty for affected businesses.
The chamber will definitely be taking the opportunity to make a submission in support of the proposals in principle although we will be expressing our view that the proposed rates remissions should be even more widespread, said Mr Gordon.
Mr Guerin said that a letter was being sent to explain the process to those business ratepayers who were expected to be eligible for rates remissions under the proposals.
He said he anticipated the proposal being released to the public for consultation and submissions as soon as it had been adopted at this week's council meeting (7pm Thursday 16 August).