Soaring land values deliver record rate hikes in regional Victoria

Farmers are being urged to challenge lazy councils that are cranking up rates on the back of record farmland values.

East Gippsland Shire has bucked the trend and cut farm rate revenue, despite a 13 per cent rise in rural land values.

Farmers must challenge lazy councils that simply crank up farm rates in response to surging land values, says Municipal Association of Victoria president David Clark.

His comments come as Victorian councils continued to roll out of double-digit rate hikes this month.

Demand for land along Melbourne’s growth corridors saw Whittlesea Council slug its 137 farmers with a 26.7 per cent hike, after the combined value of their properties rose from $35.85 million to $43.88 million in the year to January 1.

A 30.1 per cent surge in dryland farm values has prompted Swan Hill Rural City Council to draft a 2023-24 budget that hits its grain growers with a 20.8 per cent rate hike.

Mildura Rural City Council has signed off on hitting its farmers with a 13.1 per cent rate hike, while it slashes residential rates by 4.5 per cent.

Golden Plains Shire released a budget that collects an extra 34.7 per cent more revenue from farmers on less than 40ha, after their land values surged 54 per cent.

However, part of the jump in rate revenue from these smaller farms is due to the number of assessments, rising from 52 this financial year to 68 in 2023-24.

But as previously reported, not all councils are lifting farm rates by the same level as revaluations.

Surf Coast Council’s draft budget reports an 11.45 per cent rise in farmland values, but proposes lifting the revenue it collects from farmers by just 2.53 per cent.

Even smaller councils, such as Buloke Shire, which must service a small ageing ratepayer base and maintain a vast road network, has been able to contain rate increases.

Farmland values across Buloke Shire’s 2900 rural assessment surged 41 per cent in the 12 months to January this year, from $2.39 billion to $3.38 billion.

Yet Buloke Shire estimates it will collect just 3.5 per cent more in rate revenue from farmers in the new financial year, in line with the Andrews government’s fair-go rates cap.

Flood-hit Campaspe Shire has capped the amount it collects for all rating categories – farm, residential and commercial – at 3.89 per cent, despite farm values jumping 26.4 per cent.

The vast East Gippsland Shire has even cut the amount of rate revenue it collects from farmers by 0.48 per cent, despite a 13 per cent rise in rural valuations.

Mr Clark said councils where farmers actively campaigned for a fairer distribution of the rate burden were often successful.

“The system requires the community to lobby to get the proportions even,” he said, especially where councils lazily applied the same differential.