Coober Pedy Council flags massive 32pc rate rise to pull council out of debt

Coober Pedy Council administrator Tim Jackson says a huge rate rise will be on the table next year.

• Auditor-General: Coober Pedy Council has “unsustainable” debt
• Coober Pedy: Council wants water subsidies

The residents of Coober Pedy will be slugged with a massive rate rise next year as the council tries to solve its financial troubles — but bills could be partially offset by reduced water costs.

Coober Pedy Council administrator Tim Jackson says a 32 per cent rate rise will be on the table next year, in a bid to help fix the district’s trouble-plagued finances.

Mr Jackson wants to hold a referendum in October or November, asking voters for their preference on options to eventually get the council back in the black.

They would likely include service cuts, asset sales, and rate rises, which could be partially offset by reduced water costs.

Mr Jackson has ruled out his preferred 32 per cent rise this financial year, saying more consultation was needed before potentially introducing it next year.

The average residential rates bill in Coober Pedy is $750, and the rise would push that up to about $990.

While the cost would still be significantly less than an average rates bill in Adelaide, Mr Jackson said weekly household income in Coober Pedy was $855, compared to about $1200 across SA.

Homeowners with properties valued at about $463,000 in West Torrens received rates bills of about $1200 during 2018-19.

Mr Jackson said the council would lobby the State Government for a water cost reduction, which would drastically reduce the general rate rise’s impact on locals.

If the Government subsidised water costs in Coober Pedy, where the council draws water from the Great Artesian Basin, treats it, and supplies it to locals, that could reduce water costs by 24 per cent.

“We get a very significant subsidy to ensure that electricity is at Adelaide prices, but we don’t for water and that’s just an anomaly,” Mr Jackson said.

“With my preferred option, the net impact was a 6 per cent increase with rates going up 32 per cent but water going down 24 per cent.

“It wasn’t a bad outcome considering our financial dilemma.”

Sunset at Coober Pedy. Picture: Tricia Watkinson

The Government appointed the former Playford Council in January, after a July 2018 Ombudsman’s Report found serious failings and irregularities at the council.

Coober Pedy’s total debt sits at about $9 million.

“Every year we spend more than we raise,” Mr Jackson said.

“We have a structural deficit of about $1 million a year, so we’re living beyond our means by about $1 million a year – that’s the problem.”

Mr Jackson favoured a 32 per cent rate increase for one year – and a rise in line with inflation after that – along with other measures, including selling the council’s sewerage and electricity services, increasing airport fees and finding another organisation to take over its childcare service.

During the coming 2019-20 financial year, rates will rise by 2 per cent.

The council wrote to the State Government about two months ago seeking a subsidy on its water supply, in line with other regional areas, but to no avail.

Mr Jackson said it would try again, in the hope of having a cheaper water arrangement in place by the middle of next year.

Mr Jackson was yet to explore how much a referendum might cost.

A State Government spokesman in April said there were several council-owned water schemes across SA.

“The State Government is aware of the issues Coober Pedy Council is facing and will continue to discuss options available,” he said.

“Any proposal needs to be carefully considered against the impacts on South Australian taxpayers.”