ARC waives penalty for some rebels

The ghost of the Auckland Regional Council's 2003-04 rates hike and subsequent revolt continues to haunt the new council voted in last October.

It still has 2400 people with rates arrears of less than $25 for that year.

Yesterday, the council's finance committee decided they should get a chance to pay up without incurring further penalties.

The offer meant they would be let off a 10 per cent penalty that was slapped on unpaid rates last month.

The total owed by the 2400 ratepayers is $18,000.

One of the first requests from the new committee was for a staff report on writing off unpaid rates under $25.

Yesterday, finance director Brian Monk said councillors had a legal obligation to fully pursue all debts but if they were uneconomic to collect then a council may decide not to.

However, legal advisers said it was inappropriate to write off small unpaid balances at an early stage when a council had options for recovery.

These included approaching the first mortgagee for payment of the arrears and waiting until the property was sold, when outstanding rates would be paid as part of the transaction.

As an alternative to writing off rates, officers now proposed a letter go out to ratepayers owing less than $25, to advise that the January penalty would be waived in return for settlement of the debt by June 30.

But councillor Robyn Hughes, who campaigned on the RAM (Residents Action Movement) platform, said the recommendation did not go far enough.

She said it was a "slap in the face for the people's heroes who stood up to the rates rise"of up to 600 per cent in some cases.

They were the people, she said, who voted in a new council that would be different from the old.

The old council whacked them with cumulative 10 per cent penalties.

"We are saying 'pay up' like the other council did."

Instead, the council should stop pursuing rates debts for 2003-04 and put the debts in a holding account where they did not draw any further penalties.

The money would be eventually recovered when the properties concerned were sold.

Ms Hughes asked the committee to renounce the use of penalties and ask officers to report on "normal" commercial debt recovery practices for adoption as an alternative to penalties.

Finance chairman Wyn Hoadley ruled Ms Hughes' amendment could not become part of the committee's recommendation for want of a seconder.

Later, Ms Hughes said she appeared to be the only councillor who needed a seconder for an amendment.

ARC chairman Michael Lee supported the letter offering a penalty waiver only.

He said it was a proposal brought to the council by the Rates Revolt group after the outcry over the 2003-04 rates.

Mr Lee said the council had collected 98.8 per cent of the 2003-04 rates.

"Many of those who paid would have been rates protesters, as I was at the time, who would have paid up and done their civic duty."

Mr Lee said the collection rate was one of the highest in the country.

The story so far

* After last year's "rates revolt" against big ARC rates increases, 2400 people still owe less than $25 each in unpaid rates.
* The ARC has decided to drop a 10 per cent penalty against them.
* The council says 98.8 per cent of the 2003-04 rates have now been paid.