The proposed Queenstown Lakes District rate increase for 2006/07 will come in under 1 percent, down from the Council's original forecast increase, QLDC finance manager Stewart Burns said.

"An overall rates increase of 0.8% for 2006/07 is required (after allowing for growth). The effect of this increase on individual properties will vary according to location, services received, valuation and property usage," Mr Burns said.

Relevant factors included the effect of the three yearly district-wide rating revaluation and the results of the recent Funding & Rates Review, which reflected in the allocation of 2006/07 rates to various property types.

"The rate increase has gone down because assumptions made about anticipated growth in the rating base have proved to be slightly conservative. District-wide the actual increase in capital value is 8.1%, compared to 7.3% allowed for in the draft Council Community Plan. In addition the total number of rateable properties for the 2006/07 year is estimated to be 18,388, which represents an increase of 6.3% on last year, and is 1.9% more than allowed for in the draft CCP," Mr Burns said.

The overall effect of these two factors on the final rates required was that the indicative rate movements shown in the draft CCP were slightly overstated for most property types.

Rates information published in the draft CCP can only be indicative and represents the Council's best estimate at that time.

"The introduction of roading development contributions has also meant that the growth portion of capital works is no longer funded from rates," Mr Burns said.

This had benefited all ratepayers but particularly the Commercial, Accommodation andRural sectors where rating differentials for roading have been reduced.

The 0.8% increase compares with an average rate increase of 4.3% the previous year.

The Council would be asked to set the rates for 2006/07 at the full Council meeting on Friday.

ENDS

For further information please contact Stewart Burns 03 441 0499.

By: Sarah