Gold Coast Council Budget: The council budget balance act means low rate rise but continuing deficit

MAYOR Tom Tate will bring down this year’s council budget tomorrow. Rates are going up and here’s how much more Gold Coasters will be paying.

THE Gold Coast City Council is poised to bring down a budget with a rate rise similar to CPI increases, leaving the city still to pay off debt of almost $643 million.

But the city’s resident ratepayer lobbying group is forgiving of the paying off of council’s debt, welcoming predictions Mayor Tom Tate will deliver a budget tomorrow with just a small rate increase.

The group says it will forgive the council for the ongoing budget debt as residents prepare for some serious financial belt tightening post-Commonwealth Games.

Mayor Tom Tate is expected to hand down a budget at 10am tomorrow with a rate rise of 1.73 per cent. Many ratepayers will face a general rate increase of about $48.

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Mayor Tom Tate with the 2016-17 budget. Photo: David Clark

Most details of the budget have been discussed behind closed doors at special budget meetings, but projections of loan borrowings and debt have been released on council meeting papers.

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The 2017-18 council budget included loans of just less than $41 million and included another loan of $2.3 million for capital works.

Since a review in March, some funding allocated to major projects like the Palm Beach shoreline and Northern Gold Coast Sports and Community Precinct has reduced the loan requirement.

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The council expects it will now need $31.2 million in total loans rather than the $43.3 million originally forecast.

Mayor Tom Tate unveiled the Gold Coast City Council 2016-17. Photo: David Clark

Documents confirm the Queensland Treasury Corporation conducted a credit review last year and in late February the council received approval for loans up to $41 million.

The council had a debt balance of $686 million in June last year. Based on the current loan program and paying off debt of $75 million, it should be reduced by the end of the month to $642 million.

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Officers in their report said the council “sits comfortably” within the required debt ratio required by the QTC.

Gold Coast Resident and Ratepayers Association president Tom Bleier. Pic Tim Marsden

Councillors have unanimously supported an officer recommendation the council draw up a loan of $31.2 million from the Queensland Treasury to partly fund its 2017-18 capital program.

The forecast is the council will reduce its external debt balance by $44 million in 2017-18.

Gold Coast Residents and Ratepayers Association president Tom Bleier said a rate rise of only 1.7 per cent would be welcomed by his group’s membership, which included pensioners and small business operators.

“The increase they’re promising for rates is 1.7 per cent. I think that’s a very modest increase,” Mr Bleier said.

“A lot of my members are under (financial) pressure. I think it will get worse. I think we’re heading for a debt bubble in these newer areas.”

Mr Bleier said he was “not uncomfortable with the debt level”, given many Coast residents were facing high body corporate fees.

“I’d love to have a balanced book. But which government organisation is balanced (with its budget)?” he said.

“This is still a wonderful place to live. If you want to talk about something that’s outrageous, it’s the cost of water. I think the State Government’s rate for (bulk) water is another tax.”