The council has estimated its surplus for the financial year ending June 30, 2016, will be $550,000, after $100,000 is allocated for reduction of rates and $25,000 goes toward funding the current year’s Neighbourhoods of Healthy Homes programme shortfall.

A report, written by operations and services manager Tom McDowall and adopted by the council at a meeting last week, explained that the rates reduction was possible because the council received an additional $200,000 in revenue from Ngati Tuwharetoa Geothermal Assets for council land leased by the energy company.

The council has used surpluses in the past to reduce rates. For the 2010-11 year it used $100,000 and for 2011-12 a further $300,000 of surpluses to phase in the rate increase resulting from acquiring ownership of the wastewater treatment plant.

“However, for 2012-13, when there were no longer any surplus available, the rate increase was 7.2 percent.”

The report also explains the council has funded depreciation reserves to be used to replace assets nearing the end of their useful lives.

“There is approximately $8.7 million in reserves and it is anticipated the bulk of these reserves won’t be spent until 2025-30. These are not part of the surplus general funds,” Mr McDowall said.

The council approved the recommendation to use $100,000 from the general fund surplus to reduce rates for the next financial year, and implemented a policy to guide council decisions about spending surpluses in the future.

The policy ensures that monies are used sensibly and also for the benefit of ratepayers.

Source: Whakatane Beacon