Town of Bassendean: Agenda

back to the list of Agendas and Minutes >>>

TOWN OF BASSENDEAN

NOTICE OF A SPECIAL COUNCIL MEETING

Dear Council Member

A Special Meeting of the Council of the Town of Bassendean to adopt the 2010/11 Budget will be held in the Council Chamber, 48 Old Perth Road, Bassendean, on Tuesday, 29 June 2010, commencing at 7.00pm.

Mr Bob Jarvis

CHIEF EXECUTIVE OFFICER

25 June 2010

A G E N D A

Councillors, An EMRC presentation on Broadband and Tourism will commence at 5.30pm. A meal will be provided at 6.15pm and the Special Council meeting will commence at 7.00pm.

1.0 ATTENDANCES & APOLOGIES

2.0 PUBLIC QUESTION TIME – PART ONE

Members of the public who wish to do so may ask questions at this point in the agenda. A further opportunity is also provided later in the meeting.

3.0 DECLARATIONS OF INTEREST

If a Councillor believes that he/she may have an interest in any of the Budget items, they should declare an interest and the item will be voted on separately.

4.0 CONSIDERATION OF THE 2010/2011 BUDGET

4.1 Adoption of the 2010/2011 Budget (Ref FINM/BUGTG/1 - Mike Costarella, Director Corporate Services)

APPLICATION

To seek Council adoption the 2010/11 Budget as presented and amended following the two budget workshops held on the 4 May and 15 June 2010.

BACKGROUND

Staff prepared and presented the two components of the draft budget, namely the Capital Works and Operational Income and Expenditure.

Council held two workshop to discuss the draft budget.

Capital Works Budget Workshop 4 May 2010

Prior to the budget workshop, Councillors were provided with a list of projects for each Councillor to assess and prioritise. Based on:

1- Essential
2- Highly Desirable
3- Desirable

At the budget workshop held on the 4 May 2010, Councillors were presented with a list of projects for consideration totalling $5,882,691 (excluding grants and other funding sources). Each Councillor prioritised each project based on the following:

1- Essential $2,831,401
2- Highly Desirable $ 2,290,275
3- Desirable $ 761,015

Grant and funding sources for the Priority 1 projects total $1,878,185 and this consist of:

Plant Replacement Program $ 17,500.00

MRRG $ 325,049.00

State Black Spot Program $ 35,333.00

Roads to Recovery $ 106,930.00

Perth Bicycle Network (PBN) $ 35,000.00

Cash In Lieu Funding $ 872,005.00

Goodbye Graffiti - OCP $ 20,000.00

Anti Hoon Speed Cushion - OCP $ 20,000.00

RLCIP (Round 2) $ 446,368.00 Sub-total: $1,878,185.00

Therefore, an amount of $ 952,316 will need to be funded from Rates Income.

Draft Budget Workshop 15 June 2010

At the workshop, Councillors were presented with a draft budget that provided for a closing surplus as at the 30 June 2010 of $10,336. The report also included an opening deficit for the 2010/11 financial year of $79,093. The deficit was mainly due to the non sale of Lot 33 Second Ave and savings in other areas.

CPI Index

The Director Corporate Services has obtained information from the Australian Bureau of Statistics that indicates that the Annual CPI for March 2010 (Perth All groups) is 3.4 %. The WALGA costing index for the same period shows an increase in costs of 1.9%.

This may be used as a guide to increase the rates income for the 2010/11 financial year. However, given the inclusion on a new collective agreement for Staff, an increase in the cost of the Refuse Collection and Maintenance and the Landfill Levy of approximately $600,000, and additional utility charges of some $100,000, the CPI does not provide sufficient scope to provide funding in the 2010/11 financial year.

Given the above factors, Staff have prepared the budget utilising a 7% increase in the rateable income.

In order to achieve a 7% increase in the rateable income, staff have increase the rate in a dollar from 8.974 cents to 9.604 cents. The minimum rate for each property increases from $776 to $819.65.

NOTE: Should Council require inclusion of any of the excluded projects, It would need to exclude a project of a similar value or increase the rates and charges. For Council’s information 1% of rates increase equates to $88,000.

4.2 Director Corporate Services’ Report

The budget document has been formulated in accordance with requirements of the Financial Management Regulations and the Local Government Act. This incorporates:

Statutory Financial Statements – incorporating the Rates Setting Statement, Cash-flow; and notes associated with the Statements as well as Income and Expenditure Statements by Nature and Type and by Function;
Operating Income and Expenditure for:

2010/11 Draft Budget
2009/10 Forecast
2009/10 Budget

2010/11 Capital Works Program;
2009/10 Works and Services;
Profit and Loss on the Sale of Assets;
2010/11 projects included in operational budget- information only; and
Fees & Charges for 2010/11 (including 2009/10).

Introduction of a New Annual Waste Service Charge

The cost of providing for all the waste services in 2010/11 financial year has increased some $600,000 over the 2009/10 financial year. This is mainly due to the new refuse contract costs, recycling contract costs and refuse disposal fees. A factor in the increase in these costs is attributed to the continued landfill levy being collected by Local Governments on behalf of the State Government.

In light of these additional costs, staff have prepared the budget with the introduction of an new Waste Service Rate of $145 per property for the provision of all the waste services the Town provides. In previous budgets the Town has charged a recycling levy on all residential properties, however, this levy will now be absorbed into the annual waste service charge and will be applicable to all rateable properties.

This means that the previous recycling levy or $45 applicable to all residential properties will be replaced with an annual waste service charge of $145 applicable to all rateable properties.

Previously, the cost of providing for all the Town’s waste services was included in the rates and if it had been shown separately on the rates notice, it would have equated to $125 (on an average household property). This means an overall increase of $20 per annum.

Note: Local Governments in the surrounding areas have increase refuse fees by a similar amount. Whilst this is a new charge for the Town of Bassendean, the costs of running the service can no longer be incorporated in the rate increase and over the ensuing years will enable Council to assess the value and cost of the service. The 7% increase in the rate in a dollar on the rates may create an overall increase of some $200 per annum per property.

Staff have scaled back many projects from the Capital and Operating Budget, however, were left with no other option but to introduce the refuse fee in order for Council to adopt a budget with a small surplus.

OFFICER RECOMMENDATION – ITEM 4.2

That the Director Corporate Services’ Budget Report for 2010/20011 be received.

4.3 Adoption of Minimum Rate

The Minimum Rate required to be set will be determined by Council’s decision on items to be included in the Budget.

Rate models will be available at the meeting, the minimum rate included in the draft Budget is $819.65.

OFFICER RECOMMENDATION – ITEM 4.3

That Council sets a General Minimum Rate of $819.65 for the year ending 30 June 2011.

TO BE PASSED BY AN ABSOLUTE MAJORITY

4.4 Adoption of General Rate

The rate required to be set will be determined by Council’s decision on items to be included in the Budget. Rate models will be available at the meeting, rate included in the draft Budget is 9.604 cents in the dollar.

OFFICER RECOMMENDATION – ITEM 4.4

That Council sets a General Rate of 9.604 cents in the dollar upon the Gross Rental Valuation of each rateable property in the district for the period 1 July 2010 to 30 June 2011.

TO BE PASSED BY AN ABSOLUTE MAJORITY

4.5 Communication Allowances for Councillors

The maximum allowance is $ 3,000 per Councillor under the revised regulation. In 2009/10, the Communications Allowance was raised from $2,800 to $3,000 per annum, paid quarterly in arrears to recompense Councillors for expenditure on telephones, fax lines and an ISP.

COMMENT

An amount of $3,000 paid quarterly with meeting fees has been included in the draft Budget.

OFFICER RECOMMENDATION – ITEM 4.5

That a Communication Allowance of $3,000 per annum for 2009/10 be paid in quarterly amounts to Councillors with their meeting fees.

TO BE PASSED BY AN ABSOLUTE MAJORITY

4.6 Councillors’ Meeting Fees

Councillors are entitled to receive meeting fees for attendance at meetings. Currently, an amount of $7,000 per annum is paid with the payments being made quarterly (in arrears). The Local Government (Administration) Regulations provide that a minimum of $2,400 to a maximum of $7,000 be paid for members other than the Mayor.

The minimum for the position of Mayor is $6,000 and a maximum of $14,000 is set by regulation. Currently an amount of $14,000 is paid.

An amount of $7,000 (Councillors) and $14,000 (Mayor), to be paid quarterly, has been included in the draft Budget.

OFFICER RECOMMENDATION – ITEM 4.6

That:

1. Councillors’ meeting fees of $7,000 for 2010/11 be paid quarterly in arrears; and

2. the Mayor’s meeting fee of $14,000 for 2010/11 be paid quarterly in arrears.

TO BE PASSED BY AN ABSOLUTE MAJORITY

4.7 Local Government Allowance

The Local Government Allowance for the Mayor may be set from a minimum of $500 to a maximum of $12,000 or 0.002 of the local government’s operating revenue. For Bassendean, this equates to approximately $27.200. The current allowance is $15,000 paid to the Mayor.

There is provision for an amount up to 25% of the allowance paid to the Mayor, to be paid to the Deputy Mayor. Currently, an amount of $3,750 is paid to the Deputy Mayor.

An amount of $15,000 (Mayor) and $3,750 (Deputy Mayor) have been included in the draft Budget.

OFFICER RECOMMENDATION – ITEM 4.7

That a Local Government Allowance of:

1. $15,000 for 2010/2011 be paid to the Mayor; and

2. $3,750 for 2010/2011 be paid to the Deputy Mayor.

TO BE PASSED BY AN ABSOLUTE MAJORITY

4.8 Adoption of Fees and Charges

The Local Government Act 1995 requires that all fees and charges be included in the budget document.

The Schedule of Fees and Charges is attached and requires that Council adopt the fees and charges for the 2010/11 financial year.

OFFICER RECOMMENDATION – ITEM 4.8

That Council adopts the fees and charges included in the attachment to the 2010/11 Draft Budget for the 2010/11 financial year.

4.9 Rate Administration Fee and Interest Charge for Instalment Option

Council needs to include a Rate Administration Fee of $27.00 and an Interest Charge for Instalments of 5.5% in 2009/10. Interest charged may be up to a maximum of 5.5%. The interest charge is regulated by the Local Government (Financial Management) Regulations 1996.

The principal reason for the introduction of an administration fee and interest charge on the outstanding balance of rates, is to ensure Council either has use of the money for investment or an interest charge is paid by the ratepayer.

Ratepayers, who do not elect to pay their rates by instalments, can use the “special payment arrangement” and a fee of $42.00 will apply.

The fee covers officer time and external costs for preparing and sending out instalment notices and the additional receipting and checking involved.

OFFICER RECOMMENDATION – ITEM 4.9

That Council approves:

1 An administration fee of $ 27 for ratepayers who elect to use the instalment payment option for their rates in the 2010/2011 rating year;

2. An administration fee of $42 be applied for those ratepayers who elect to use the “special payment arrangement”; and

3 An interest charge of 5.5% on the balance of rate instalment monies for ratepayers who elect to use the instalment payment option for their rates in the 2010/20011 rating year.

TO BE PASSED BY AN ABSOLUTE MAJORITY

4.10 Transfer to/from Reserves and Restricted Cash

The 2010/11 Draft Budget contains funds being transferred to/from Reserve Funds and these are listed on Page 21 of the document.

OFFICER RECOMMENDATION – ITEM 4.10

That the Transfers to and from Reserve Funds contained in the 2010/11 Budget, be adopted by Council.

4.11 Rate Instalment Dates

The Local Government Act 1995 requires local government to offer ratepayers the option of paying rates by 4 instalments, and each instalment subsequent to the first is due no sooner than two months from the due date for payment of rates.

The dates contained in the recommendation below are recommended as the due dates for the payment of rates by instalments:

OFFICER RECOMMENDATION – ITEM 4.11

That Council sets the following dates as the due dates for payment of rates by instalments:

23 August 2010;

22 October 2010;

17 December 2010; and

18 February 2011.

TO BE PASSED BY AN ABSOLUTE MAJORITY

4.12 Setting of Interest Rate for Late Payment of Rates

The Local Government Act (1995) allows councils to set a late payment interest penalty for rates. The Local Government (Financial Management) Regulations 1996 allows a maximum late payment interest rate of 11%.

The amount of interest charged on overdue rates is an incentive to ratepayers to pay their accounts promptly. Council is required to formally adopt the rate at the time of adopting the budget.

OFFICER RECOMMENDATION – ITEM 4.12

That a late payment interest rate be set in 2010/11 in accordance with the provision of Section 6.51(1) of the Local Government Act (1995) and the Local Government (Financial Management) Regulations No 70, at 11%.

TO BE PASSED BY AN ABSOLUTE MAJORITY

4.13 Discounts, Incentives, Concessions & Write-offs – 2008/09 Financial Year

Council has offered a rate incentive scheme which offers prizes for payment of rates within the 35 days from the date of issue of the Rates Notice. Council will be offering Ten (10) Cash Prizes of $500 in addition to prizes offered by sponsors at no cost to Council.

All ratepayers who pay rates on or before the due date are automatically entered into the draw unless Council is notified that any person does not wish to participate. The draw is conducted by random computer selection of eligible ratepayers as soon as possible after the due date. All winners are notified in writing by Council.

Council will also be providing a rates concession on the Hyde Retirement Village which equates to 50% of the rates levied .

OFFICER RECOMMENDATION – ITEM 4.13

That Council adopts the Rates Concession and Prizes for the 2010/11 financial year Budget.

4.14 Consideration and Adoption of the 2010/11 Budget

The draft Budget estimates of Income and Expenditure was presented to budget workshops and following the inclusion of the additional projects, Council is now requested to adopt the Budgets as presented.

As discussed at the budget workshop held on the 2 June 2009. the budget includes a 7% increase in rates income and provides for a closing surplus at the 30 June 2011 of $10,336.

OFFICER RECOMMENDATION – ITEM 4.14

That Council adopts the 2010/11 Budget for the year ending 30 June 2011, as presented.

TO BE PASSED BY AN ABSOLUTE MAJORITY

5.0 PUBLIC QUESTION TIME & RIGHT OF REPLY

Members of the public who did not ask questions in Part One of Public Question Time will be heard first.

6.0 CLOSURE