Black Orchid Collective cafe and tattoo shop owner Veronica de Oliveira says the fact she could be charged a $750-plus rental fee for placing three small dining tables on the footpath outside her establishment was "ridiculous" at a time when Tauranga City Council should be giving Mount Mainstreet businesses incentives to stay open. Photo / Sandra Conchie
Black Orchid Collective cafe and tattoo shop owner Veronica de Oliveira says the fact she could be charged a $750-plus rental fee for placing three small dining tables on the footpath outside her establishment was "ridiculous" at a time when Tauranga City Council should be giving Mount Mainstreet businesses incentives to stay open. Photo / Sandra Conchie
EDITORIAL
Hospitality businesses across New Zealand have been dealt a new blow by local government, with councils hiking outdoor dining fees and adding pressure to already struggling businesses.
Hospitality businesses in Tauranga and Mount Maunganui called the new outdoor street dining charges “disrespectful” and say they are “pilingeven more misery” on an industry already being put through its paces.
Changes to Tauranga City Council rules intended to create a fairer and more consistent approach and protect footpaths for pedestrians came into effect on July 1 after consultation last year.
Businesses must have a licence to use street space for dining and pay an annual charge based on the size of the area used and its zone within central Tauranga or Mount Maunganui. Previously, only 27 Tauranga CBD businesses were charged.
For Mount Maunganui Business Association destination manager Michael Clark, these charges simply do not make sense. Clark believes outdoor dining adds vibrancy and helps attract people to the area, which in turn benefits the wider community.
“I don’t think it’s justified for our council to charge us significantly more for street dining spaces than other main centres. This is just piling even more misery on to businesses [which are] already struggling,” he said.
The council’s research found Auckland charged a $401-a-year permit fee plus $21-154 per square metre, Hamilton a $90 fee plus $27 a table and Wellington $190 for a first permit and $95 for renewals.
Veronica de Oliveira, owner of the Black Orchid Collective cafe and tattoo shop in Mount Maunganui, said she would have to pay a “ridiculous” $750 fee plus GST to place “three little tables” on about 5sq m of footpath.
“Does the council know how many coffees I will need to sell to earn enough to pay these charges?”
She said some shops had closed after a “terrible winter” and businesses were hoping for a good summer.
“We were finally taking a bit of breath in preparation for our main income-earning period, and now we’re hit with these unexpected charges.
“It’s very disrespectful to us business owners trying to hang on and keep going.”
The outdoor dining fees are on top of increases in rent and insurance costs businesses have already had to deal with in recent times. Coupled with a decrease in sales for many, the fees give them little hope business can improve.
Mas Eden, owner of Turkish to Go Tauranga on Devonport Rd, said he was shocked and angry to learn he was now expected to pay rental fees to put four tables on the footpath when his sales were down 60-70%.
Turkish to Go Tauranga owner Mas Eden says he will refuse to pay rental fees to put four tables on the footpath outside his cafe when his sales have dropped 60-70% due to on-street parking charges and city-centre development works. Photo / Sandra Conchie
He said foot traffic was so quiet on Thursday, he only sold two coffees for $10 between 9am and 11.30am.
In Queenstown, outdoor dining fees are set to increase by almost 1500%, and some hospitality businesses fear for their future if the charges are put in place.
Queenstown Lakes District Council (QLDC) has recently changed what it charges hospitality venues in town to use public space for al fresco dining.
According to RNZ, the council had been planning to increase the fees in a stepped way before Covid, but this year transitioned to what it said was a charge based on market value – 30% of the value of the indoor rent.
Queenstown business owner Blair Impey told RNZ’s Checkpoint one of his businesses had paid the council $3200 a year for the last five years and is now looking at having to pay $51,000.
“It doesn’t add up maths-wise – I think you would have to sell 60,000 extra drinks there to pay that off,” Impey said.
Hospitality NZ chief executive Steve Armitage described it as an “almighty shock” for a sector still recovering from Covid and struggling with the “current economic climate”.
Armitage says no business is arguing against paying a fee to use a public space maintained through ratepayer funding – it is the high percentage being questioned.
Impey says he is going to meet with the council and is hopeful “common sense will prevail”. If it doesn’t, he fears a lot of businesses will not see the end of this summer.
New Zealand needs vibrant, thriving town centres. Over the years, businesses in the high street have suffered a few big blows, with the advent of malls, the rise in online shopping and working from home, as well as inflation and the skyrocketing cost of living. The high street, with its cafes, restaurants and other shops, is the heart of many towns across the motu and an essential part of what makes a community. We need to do more, not less, to help these businesses thrive.
