He said this was not abnormal and was consistent with previous years.
The number of people who received a late-penalty notice compared to 3196 in February 2022, 3023 in February 2021, 3135 in February 2020, 3390 in February 2019 and 3570 in February 2018.
Collé said this downward trend correlated with an increase in ratepayers who paid by regular direct debit over the past five years and minimised the risk of late payment.
The largest sum owed to the council, inclusive of penalties, was a seven-year-old debt of $93,811. The council was pursuing this with a debt-collection agency and it was before the courts.
When asked how non-payment impacted the council’s work, he said the revenue paid for various services.
“The large-scale non-payment of rates would mean that [the] council would have to decide whether to stop delivering certain services to the public or to fund the services from a different source.”
There were a number of options if someone had trouble paying their bill, he said
“This might mean entering into a payment arrangement over time, entering into a rates postponement scheme or applying to [the] council for a rates remission.”
When asked how the cost of living crisis was affecting rates payments, he said the council had not had an increase in the number of ratepayers requesting support with payments. He said it remained committed to engaging with ratepayers needing advice.
The council had 30,775 ratepayers and was forecast to collect $113.5m in rates for the year ending June 20, 2023.
Councillors this week approved its draft Annual Plan, which included a proposed 7.2 per cent rates rise, to go out for consultation.
Rotorua District Residents and Ratepayers Association chairman Reynold Macpherson said, in his opinion, the $5.4m figure “could indicate how unaffordable rates had become”.
“Our community and its economy have been profoundly affected by three crises - Covid, inflation and the homeless industry.”
He believed the council should cut $5.4m from expenditure as a contribution towards the affordability of rates.
Rotorua Age Concern manager Rory O’Rourke did not believe elderly people made up a large portion of those not paying their rates.
Retirees were of a generation who prioritised paying their bills, he said.
He said Age Concern members tended to be more affluent, but many elderly people were struggling with the rising cost of living.
About 60 per cent of members owned homes.
Rotorua Budget Advisory Service manager Pakanui Tuhura said 10 of 420 clients from the past nine months were in rates arrears.
“I think this is because keeping a roof over their heads is a very high priority, and people are making sure their rates are paid for that security.”
Rates did not fluctuate once set so people could plan to pay them.
He said issues with rates usually happened because a payment was forgotten or the person who organised the rates payment was no longer living in the household.
His advice to anyone struggling to pay rates was to talk to a budget adviser or the council for solutions and to organise a regular automated payment to avoid late penalties, as well as to find out if a person qualified for a rebate.
What happens when rates aren’t paid?
Collé said unpaid rates were first followed up with reminder notices. If the rates were still unpaid and the property had a mortgage, the council under the Local Government Act was able to place a demand with the bank, which then pays on the ratepayer’s behalf and adds to their mortgage.
If rates were unpaid and there was no mortgage on the property, the council engaged a third-party debt collection agency to pursue the overdue amounts on its behalf.
The last resort if all other options were exhausted was a rating sale, where the council followed a specific legal path to place the property up for sale in order to recover the portion of unpaid rates.
Collé said this was incredibly rare.
Rotorua Lakes Council was approached for a response to Macpherson’s comments, but a spokesman said because they were of a political nature, Local Democracy Reporting was directed to Rotorua Mayor Tania Tapsell, who declined to comment.
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