New levy, rate rise: Details of Toowoomba council’s record $703m budget revealed

Toowoomba ratepayers will be slugged an extra $200 a year on average to help pay for the most expensive project in the history of the council. How it will affect your family’s bottom line:

Residents will pay an extra $200 a year in rates as part of this year’s Toowoomba Regional Council budget, which mayor Geoff McDonald said was filled with “tough decisions”.

Mr McDonald and councillors endorsed the record $703.6m budget for 2024-25, which includes a five per cent rate rise — the highest in more than a decade.

It means a family in Toowoomba on a property land-valued at $200,000 using the average amount of water (182kL) will pay more than $3600 over the next 12 months.

There are also increases across the board for the organisation’s water, waste and sewerage charges that amount to more than $100 in extra costs for households.

The massive document has been dominated by the looming $270m Cressbrook Dam safety upgrades, which occupies more than half ($110m) of council’s unusually large $230m capital works budget.

Mayor Geoff McDonald speaks to media as Toowoomba councillors formally approve a $703 million budget for 2024-25, Tuesday, June 25, 2024. Picture: Kevin Farmer

The council has also unveiled its four-point plan to help pay for Cressbook if external funding isn’t secured in the coming weeks, which includes rate rises, debt, project delays and drawing on cash reserves.

The budget will result in a surplus of slightly under $1m, in line with state government requirements, but is dependent on federal assistance grant payments arriving in the next few days.

The council is expected to hold debt in the order of $216m in 12 months’ time, borrowing an extra $10m in the next financial year.

Aside from Cressbrook and the final works in the 2022 flood recovery program ($22m), the council has allocated $98m towards a series of capital projects.

Speaking after the meeting, Mr McDonald said he understood the toll this rate rise would have on residents struggling through the nation’s cost-of-living crisis.

“This has been a tough budget, but it’s a budget for now and a budget for future proofing our region,” he said.

“It’s the same discussion as what households are having, it’s the same discussion that businesses are having.

“It’s about prioritising what we’re doing, importantly delivering on what expectations are in the community.

“Last year, we had a four per cent general rate increase, this year we’re at five per cent.”

Toowoomba councillors have formally approved a $703 million budget for 2024-25, Tuesday, June 25, 2024. Picture: Kevin Farmer

Council’s day-to-day budget has grown by nearly five per cent to $472m, with Mr McDonald bemoaning the inflating costs of insurance premiums and electricity charges.

“We’re estimating our costs for electricity will go up somewhere in the order of $100,000 and that there will be a $900,000 increase in insurance premiums alone,” he said.

“So that’s almost $1m in those two areas and a million dollars in round terms equates to around about a one per cent rate rise.”

Mr McDonald also took aim at the current uncontested federal funding that local councils received, calling on the higher tiers of government to address it.

He said the TRC would lose about $8m over the next three years in federal assistance grants, a situation he believed “doesn’t make sense”.

Mayor Geoff McDonald and finance and business strategy general manager Ann-Marie Johnston as Toowoomba councillors formally approve a $703 million budget for 2024-25, Tuesday, June 25, 2024. Picture: Kevin Farmer

“The Australia Local Government Association’s estimate is one third of all community infrastructure is delivered and managed by local government, yet we get 3 cents in every dollar – it doesn’t matter which way you look at that, it just does not make sense,” he said.

“Local government is the closest to the people and we are the best deliverer when it comes to community involvement, community engagement and delivery on the ground.

“But we need to be funded to do that and that’s the critical part of why we lobby.

“It needs a complete shift, because we’re delivering in our region almost two-thirds of the community infrastructure.”

How much rates will go up in your town

Residents living outside of Toowoomba will be hit hardest in the latest council budget, with some regional areas nearly paying as much as their city counterparts.

Council budget documents show locals in Blue Mountain Heights, Highfields, Hodgson Vale and Westbrook will be handed a 6.1 per cent general rate increase.

It means a resident with the average land value for the outer urban areas of $244,000 will pay $1467 – an extra $84 and just shy of the Toowoomba amount of $1554 (based on an average land value of $203,000).

Residents’ actual rates notices will depend on their land valuations, set by the Queensland Government.

Crows Nest, Oakey and Pittsworth residents will all be slugged with a 10 per cent rate rise, bringing the average bill to $1162 (up $106 on a land value of $112,000).

Smaller towns like Brookstead, Cecil Plains, Clifton, Millmerran, Nobby, Southbrook and Wyreema will also be charged an extra 10 per cent in rates, worth about $93 extra per year at an average land value of $124,000.

Council’s water infrastructure charge has jumped 6.5 per cent to $672 for bulk supply users and 9.27 per cent (to $470) for non-bulk users, while the waste collection charge is up five per cent or $15 to $307.

Sewerage charges are up $30 to $532 in 2024-25 (an increase of 5.95 per cent), while the renamed waste facilities and landfill rehabilitation levy has jumped $4 to $77 for the year.

Public Transport Levy created, but no plan yet for funds

The council will invest $3m into the region’s public transport with the creation of a new levy, in a move mayor Geoff McDonald hopes will lead to state government investment.

The $40 charge has been created by pausing the Park and Open Space and Biosecurity levies.

Mr McDonald said the council had not determined what the money will be used for, but declared the framework essential to attracting funding for public transport from higher levels of government.

“The public transport levy will be the same value of those two (paused) levies, so the net increase is no more to ratepayers, and that’s a really important point,” he said.

“We’d love to live in a place where public transport is accessible, where it’s easy to access, where it gets you to and from your place of work or school, (but) we’re behind the eight-ball.

“The state government is aware of this and they said this is fantastic news, they will now look closely and more favourably on our region because we’re putting skin in the game.

“It aligns beautifully with our sustainable transport strategy, which was endorsed last year, and there’s a number of initiatives in there that just will not be delivered under a business as usual approach.”

Revealed: How council will pay for Cressbrook Dam

The Toowoomba council will raise rates, delay projects, borrow more and draw on its cash to help pay for the enormous $270m cost of the Cressbrook Dam safety upgrades.

Mayor Geoff McDonald laid out the four-point plan as part of his budget speech, which will see council debt balloon to $216m by the end of the next financial year.

However, the predicted position is far lower than the $300m debt level Mr McDonald had foreshadowed in the months leading up to the budget.

“We are well in advance of where we could possibly get to if we don’t financially manage this properly,” he said.

Council will also draw down on $100m of its cash reserves to help pay for the mammoth project, with that figure expected to sit at $105m by the end of 2024-25.

Flagship projects like the new civic administration building and the long-awaited Charlton sports precinct are also major casualties of Cressbrook, with the mayor confirming neither would be advanced in the next financial year.

Fourteen projects in total have been deferred due to the upgrade, which includes a new park, landfill rehabilitation projects, cycleways, culvert renewals and waste facility upgrades.

“They definitely have been pushed back — our admin building, the sports park, some of our water infrastructure program has been moved on, because we need it to,” Mr McDonald said.

“This is the argument we’ve been having with the state and federal government — we can afford to do the whole lot if we want to, but we’ll set the place broke and rates will go up 30 per cent.

“We’re not a council for that.”

It comes as the mayor prepares to deliver the business case for Cressbrook to Premier Steven Miles and water minister Glenn Butcher in two weeks’ time, with the view of potentially securing financial support from the state by August.

Mr McDonald confirmed the council would draw down less debt if it secured external funding.

McDonald: Why council must ‘build new’

Toowoomba councillors have formally approved a $703 million budget for 2024-25, Tuesday, June 25, 2024. Picture: Kevin Farmer

Mayor Geoff McDonald has declared the council can’t afford to not continue “building new” despite revelations it will struggle to meet a key state government metric.

Budget documents have revealed the TRC is unlikely to have an asset sustainability ratio of 60 per cent in the coming years.

The ratio, which is set by the state government, determines how much of the council’s capital works budget is spent on renewing ageing infrastructure.

Finance and business strategy general manager Ann-Marie Johnston told councillors earlier this year the council could “struggle” to meet that 60 per cent target due to Cressbrook.

But Mr McDonald said the region was growing too fast for the council to focus solely on renewing its exiting network, which he said was an argument for more external support.

“A growing community needs to be recognised by the state and federal governments,” he said.

“We’re struggling to (meet that target), because over the next 10 years in the (capital works) plan that’s in there, we talk about a new regional sports park, a new admin building, and water infrastructure that’s coming at us at a rapid rate.

“We’re a growing community, we need to build new — we need new sports facilities, we need new water infrastructure.

“We need a new admin building which helps to attract people and retain staff into our region.”

New projects in budget revealed

Bridges, water pipelines, waste facility upgrades and sports precinct renewals have all been included in the council’s capital works budget for 2024-25.

Outside of the Cressbrook Dam upgrade ($110m) and the completion of the DFRA Flood Recovery Program ($22m), the TRC has outlined a relatively small budget for new works of just $98m.

The most prominent projects include replacing two timber bridges at Brookstead and Branchview at a cost of $5.5m.

Another $2m will also be spent on council’s five-year lower order road program, which looks to address roads in poor condition.

The third stage of the Toowoomba Waste Management Centre’s vertical expansion, worth $5.5m, has also been costed in the budget, as is $2.5m for preliminary works on the state government’s Toowoomba to Warwick pipeline.

$2.4m will be spent to replace the Kearneys Spring Recreation Reserve clubhouse and amenities, which services touch football and softball among other sports.

Playgrounds, green spaces and skate parks in Toowoomba, Cambooya, Meringandan and Pittsworth will earn a combined $2.14m for upgrades and renewals.

Planning has also started on a new art gallery for the region, with the council committing $300,00 towards a business case.

The smart water meters program will continue to be rolled out across the region at a cost of $3.3m, while $1.5m has been allocated to connect Vale View to Toowoomba’s bulk water supply.

Asset sales “on table” as council balances budget

The Toowoomba Regional Council could explore asset sales in the coming years, with mayor Geoff McDonald declaring nothing was off the table as the organisation tries to manage its costs.

The region’s asset base is expected to balloon to more than $8.6bn within 10 years, up from its current value of $6.2bn.

The council is expected to pay the bulk of the $270m Cressbrook Dam upgrades even with external support, and some councillors have in the past suggested the organisation sell some or all of its dams to reduce the burden on ratepayers.

Recently, councillor Edwina Farquhar urged the TRC to move ahead with the divestment of its old nursery in Middle Ridge and the land that will become Highfields’ town centre to free up cash to help pay for Cressbrook.

Mr McDonald said the council was exploring all options to ensure its long-term sustainability, which could include asset sales in the future.

“What I’m really excited about in this term of council is that 11 councillors sat together on the first day and we challenged ourselves to look at things differently — we’re actually walking the talk,” he said.

“Everything is on the table to make sure that we have a council that functions well, the attracts staff, that delivers for our community and delivers for a bright future.”