Rates Harmonisation – Overview and FAQs

Overview

Rates across the Central Coast Local Government Area (LGA) are being reviewed and will change from July 2021. The changes to your rates will come from:

  1. Rates harmonisation which will address the current rates imbalance from the rate path freeze and align the rating structure across the LGA for all rating categories.
  2. Increase in Council’s rating income.

Step one: Harmonisation of rating structure

Important: Rates harmonisation does not result in any additional income for Council.

Currently ratepayers across the Central Coast pay different rates, even though their land values are the same, as different rate paths are in place depending on whether you live in the former Wyong Shire (Wyong LGA) or former Gosford City Council area (Gosford LGA). This is because the NSW State Government put a rate structure freeze in place at the time the former Councils amalgamated in May 2016.  This meant that the rate structure in place before amalgamation had to stay in place until this year – there could be no changes. 

The freeze has now lifted and amalgamated Councils, including Central Coast Council, must have one rating path/structure in place for the entire Central Coast Local Government Area by 1 July 2021.

Council is proposing to harmonise the minimum ordinary rate to $565 in 2021-22. Harmonising the minimum rate to $565 means that all ratepayers will be levied rates of at least $565 regardless of your property’s land value.  Based on current land values the minimum rates will apply to all properties with a land value up to $187,000.  Properties with land values above $187,000 will pay more than the minimum rate of $565.

How much Ordinary Rates (less the Domestic Waste Management charge) will go up or down due to harmonisation is largely dependent on the value of land. 
Gosford LGA residential ratepayers’ land values are on average 43% higher than Wyong LGA residential land values. This means that former Gosford ratepayers have been paying significantly less in rates than former Wyong ratepayers with the same land value.

Step two: Increase in Council’s rating income

To ensure Council remains financially sustainable Council has applied to the Independent Pricing and Regulatory Tribunal (IPART) for a Special Variation (SV)of 15% to provide an additional $25.9M in income next financial year. 

The special variation of 15% does not apply to the total amount payable as shown on your Council rates notices. It only applies to the total amount of Ordinary Rates Council can collect (so excludes the Domestic Waste Management charge). 

Gosford LGA residential ratepayers will pay on average 26% higher due to harmonisation and another 15% on that for the SV. This is on average $8 per week extra. Wyong LGA residential ratepayers will get on average a 20% reduction due to harmonisation and then after the SV, they’ll be getting a nine percent reduction on average. This is on average $2 per week less for Wyong.

IPART’s determination of Council’s Special Variation application is likely in May 2021.

What about Rate Peg

The amount that Council can increase its rate income each year is set by IPART and called the rate peg. The rate peg for 2021-22 has been set at two percent. This means even without a SV rate increase, Council’s rate income will increase by two percent. 

Rates Calculator

The rates calculator has been developed to provide residential ratepayers with the estimated impact from:

  1. Rates harmonisation only
  2. Rates harmonisation plus rate peg of 2%
  3. Rates harmonisation plus SV of 15% (including rate peg of 2%)

Proposed New Residential Rates Calculator

1. Please enter your current land valuation as printed on your yearly rates notice. Alternatively you can find your land value through the valuer general's website - please use valuing year 01 July 2019.
2. Please select your former local government area: Gosford or Wyong.
$554
$565
$565
$565
$ Increase from 2020-21
$11
$11
$11
$ Increase per week
$0.21
$0.21
$0.21
$300
$565
$565
$565
$ Increase from 2020-21
$265
$265
$265
$ Increase per week
$5.10
$5.10
$5.10

Please note:

  • Estimated rates are based on the following:
    • Land values as at early December 2020.  Council will continue to be provided with updated land values from the NSW Valuer General up to the time that the rate in the dollar is struck for 2021-22
    • Rating categories as at early December 2020 – properties may be reclassified up to the time that the rate in the dollar is struck for 2021-22
    • Rates harmonisation based on a proposed rating structure with a minimum rate set at $565
    • Rates from the Special Variation at 15% is based on Council’s application.  The actual percentage will be determined by IPART
  • Houses and apartments may be on the minimum rate, though the majority of minimum rate properties are units.
  • These indicative Ordinary Rates exclude the Domestic Waste Management charge and other levies included in Council rates notices.
  • The final 2021-22 rate levies may vary due to IPART decisions and marginal movements due to model sensitivity.
  • The averages released by IPART are calculated using the total revenue / the number of assessments.

The estimates provided in this calculator are based on your individual land value.

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Where to find your property’s valuation?

To use the calculator you will need to know the valuation of your property that is set by the NSW Valuer General. This value is based on the land value only and does not include any improvements such as buildings. The valuation of your property can be found on your annual rate notice – the rate notice you receive at the start of the financial year. It does not appear on every rate notice if you pay rates quarterly. (see image below).

You can also find your land valuation from the NSW Valuer General website – select the 1 July 2019 value.
 

Rates Notice

What is rates harmonisation?

Harmonisation means one rating path or structure will be put in place for the entire Central Coast.  So, if your residential land is valued by the NSW Government at $300,000 you will pay the same rates no matter where you live on the Central Coast.  Rates charged for each property will still vary depending on the rating category (residential, business, farmland and mining) and your land value determined by the NSW Valuer General, but the property location will no longer be a factor. 

Why is Council harmonising rates?

Each year Council collects rates to fund community infrastructure and services. Currently, these rates are different depending on where you live on the Central Coast. Council is required by the NSW Government to harmonise the rating structure of the former Gosford City and Wyong Shire Councils by 1 July 2021. Harmonising rates will enable a fairer and more equitable approach to rates collection. 

How are the charges on my rates broken down? / what are Ordinary Rates? 

Your residential Council rates bill is made up of

  1. Ordinary Rates (incudes minimum rate + amount based on land value)
  2. Domestic Waste Management charge

Harmonisation and/or any Special Variation rate increase applies to Ordinary Rates only.

What are the different rating categories?

Every parcel of land in NSW falls within one of four categories for rating purposes and Council is required to categorise each one based on its characteristics and uses.

  1. Residential - where the dominant use is for residential accommodation (does not include hotels, caravan parks, nursing homes etc). If vacant land is zoned or classified as residential it comes under this category.
  2. Farmland - where the dominant use of the land is for farming or agricultural production, where the primary production business has a significant and substantial nature and a purpose of making a profit. Hobby farms do not meet the definition.
  3. Mining - where the dominant use is for a coal or metalliferous mining.
  4. Business - all land that cannot be classified as farmland, residential or mining.
2020/21 current average an minimum annual rates

What about land value? How does land value affect rates harmonisation? 

The NSW Valuer General is the statutory independent valuing authority in NSW. The valuation process is something Council cannot influence. Land is valued by the NSW Valuer General under the Valuation of Land Act 1916. These valuations are carried out approximately every three years for rating purposes and you should get a valuation notice once completed. The latest valuation notice was issued in March/April 2020 with land values as at 1 July 2019. These land values must be used for rating from 1 July 2020 to 30 June 2023.

Ordinary Rates are calculated based on a variable rate which is applied to the land value of your property. Where the rates calculated is below the minimum rate the minimum rate will apply. The rates are distributed within each rating category based on the land value of individual properties in proportion to the total value of all land within the rating category in the Central Coast LGA.

Increases in land values do not necessarily lead to similar increases in rates. Changes to land valuations will result in a redistribution of the rates levied across categorised properties, but individual rates will change based on the change in your property’s land value compared to the overall change in land values within the rating category of your property.

What if I don’t know my land value or don’t agree with it?

Information about the NSW Valuer General’s valuation process and how to request a review is issued with the valuation notices. It is very important to read that information as it explains what you should do if you have concerns about your valuation and how to go about requesting a review of your valuation. As valuations are provided by NSW Land & Property Information on behalf of the NSW Valuer General who is the statutory independent valuing authority, all enquiries should be directed to NSW Land & Property Information:

Phone:1800 110 038
Website: www.valuergeneral.nsw.gov.au

Submit an enquiry

The NSW Land & Property Information and NSW Valuer General’s Office websites contain information on the valuation process and how to request a review/lodge an objection.

So does my land valuation affect what I will pay under rates harmonisation?

With a new harmonised rating structure to be introduced on 1 July 2021, Central Coast ratepayers may see an increase or a decrease in their rates dependant on the location and value of the property. 

Currently, ratepayers from the former Wyong LGA pay more than ratepayers in the former Gosford LGA. Will that change with rates harmonisation?

Under rates harmonisation, the creation of a uniform rating structure will mean some of the existing rates will go up and some will go down from 2021-22. 

How much Ordinary Rates (less Domestic Waste Management charge) will go up or down due to harmonisation is largely dependent on the value of land.

Gosford LGA residential ratepayers’ land values are on average 43% higher than Wyong LGA residential land values. Gosford LGA residential ratepayers have been paying nine percent less rates on residential land valuations than Wyong LGA ratepayers.

This means that former Gosford ratepayers have been paying significantly less in rates than former Wyong ratepayers with the same land value. 
Gosford LGA residential ratepayers will pay on average 26% higher due to harmonisation and another 15% on top of that  if Council is successful in its application for a Special Variation to IPART.  This is on average $8 per week extra for Gosford LGA ratepayers. Wyong LGA residential ratepayers will get on average a 20% reduction due to harmonisation and then after the SV, they’ll be getting a nine percent reduction on average. This is on average $2 per week less for Wyong LGA ratepayers.

However these are just average rate figures and some rates in Wyong LGA will still go up with rates harmonisation, particularly those on the current minimum rate in Wyong LGA which will be harmonised to $565. For the approximately 3,600 ratepayers in the former Wyong LGA, mostly unit owners, who currently pay the minimum of $300 a year in Ordinary Rates, it means this will go up to $565.  In Gosford LGA those who currently pay the minimum of $554 will see this increase to $565.  

The harmonised minimum rate of $565 for the Central Coast is set annually by IPART and is the maximum that a Council can charge. This equates to $10.87 per week for the services which Council provides to the community from rates.

What is the minimum rate and who pays it?

Minimum rates are a specific rate, where a minimum amount is levied on each parcel of land, regardless of the land value. This mostly applies to apartments and units, as these dwellings share the land value of the land on which the apartments are built. As a result, they tend to pay substantially lower rates to that of houses. Councils set minimum rates to reduce the gap between what houses and apartments pay in their Local Government Areas.  This is because the use of Council services like parks, open space, beaches, and local roads, is available to everyone regardless of whether you live in a house or unit.

Is harmonisation happening regardless of IPART’s determination on the Special Variation (rate rise)?

Yes. Council must have a new rating structure in place by 1 July 2021. 

Is rates harmonisation being used to help solve Council’s financial challenges?

No. Rates harmonisation does not result in any additional income for Council.  Rates harmonisation redistributes the permitted rates income amongst the ratepayers within each rating category.

Can Council automatically increase rates?

No. The total amount of income any Council can receive from rates is capped by the rate peg set annually by IPART. Council’s rates income can only increase in one of the following ways:

  • Rate peg set by IPART (rate peg is the annual amount that Councils can increase rates by; and for 21-22 it is 2%)
  • Applying to IPART for a Special Variation

On 9 February 2021 the Council made a decision to apply to IPART for a 15% one-off permanent Special Variation increase (which includes the 2% rate peg). IPART’s determination of Council’s Special Variation application is likely in May 2021.

How can I work out how much I will pay under the harmonised rating structure?

If you know your land value than you can use the rates calculator on this page to find out.

Will I still get the Pensioner Rebate?

Yes. Residents who hold a pensioner concession card are still entitled to apply for a rebate.

What do I do if I have trouble paying my rates?

If you are having difficulty paying your rates, contact us as soon as possible on 1300 463 954 to discuss your situation. Make it clear what you can afford to pay or ask us to put a proposal to you.

Depending on your needs, we can provide you with information about:

  • payment options, including help to set up weekly, fortnightly or monthly direct debits
  • personal payment plans to help you pay off your overdue rates at the same time as addressing your future instalments in one easy plan
  • access to Centrelink’s Centrepay facilities
  • referral to financial counselling services
  • advice on how to manage your water usage to save money.

Council recognises there are cases of genuine financial hardship requiring respect and compassion in special circumstances. Council has recently reviewed our Debt Recovery and Financial Hardship Policy which is currently on public exhibition and is seeking feedback until Tuesday 9 March 2021. You can view the Policy at yourvoiceourcoast.com

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