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Tauranga Council‘s revenue slashed by $11 million

Tauranga Mayor Tenby Powell.

Empty car parks and airport runways due to coronavirus have slashed Tauranga City Council's revenue by $11 million.

With businesses closed and people in lockdown, parking revenue dropped $4.1 million down from the predicted end of year levels and airport landing fees fell by $1.6 million.

Meanwhile, event centres sit empty waiting to reopen.

A report to the Finance, Risk and Audit Committee on Tuesday outlined the financial impact of COVID-19 and revealed the significant revenue drops including parking and landing fees.

It comes after Mayor Tenby Powell stated Tauranga City Council was "kicking a debt can down the road" for decades and only corrective rate hikes would prevent council hitting its debt-to-income levels. 

A proposal to consult on a 12.6 per cent rate increase was passed in March 2020 but this has been reduced to 7.6 per cent and is still open for consultation. 

Tenby says the loss of revenue is a challenge but it is expected as COVID-19 changed the playing field. 

"The reality is we've moved out of level 4, into level 3 and the world has changed.

"We have to recognise the pain people have gone through as significant.

"We have to reduce council expenses." 

Tenby says there is a silver lining as the loss of revenue is being offset by a reduction in capital and operational expenses. 

The adjusted end of year debt prediction for the council is $525 million which is lower than the expected debt level of $543 million.

However, some capital projects will need to be rolled forwards into the 2021 financial year.  

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11 Comments
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Where do we start

Posted on 14-05-2020 11:41 | By

Putting a bus lane down Cameron Rd, wasting money on the city centre, more cycle lanes and the biggest waste of all The waste management proposal

@socantor01

Posted on 13-05-2020 17:09 | By

Look at Ngatai Rd and the pointless titivating. It serves no purpose. No congestion, no accidents, no cyclists, no traffic. Why? Just putting money in contractor buddies pockets. Done to justify some management positions. Self serving waste. Don’t confuse day to day essential “services” with pointless expensive capital expenditure.

Rates

Posted on 13-05-2020 14:42 | By socantor01

So what services do you want the Council to drop now, folks?

Lead by example.

Posted on 13-05-2020 12:21 | By morepork

"We have to reduce council expenses." So, why not take a wage cut, say 10%, across all management in TCC? It’s not like Mr. Powell needs the money... As for "deferring" some capital projects into 2021, why not roll them forward until such time AS WE CAN AFFORD THEM. It’s time there was a serious attempt to cut waste and "nice to have" projects.

Nailed it

Posted on 13-05-2020 11:58 | By

He says they have to reduce expenses. Correct. The loss in revenue has to be matched and more by cutting costs. But they show no sign of doing this. They are pouring money away, as I write, on needless titivating. He only mentions the shortfall in revenue to scare people into accepting their continued waste. It’s politics, not financial truth.

All about show and spin

Posted on 13-05-2020 10:48 | By

Instead of tackling the hard issue of reducing expenses in the face of reduced revenue all I’ve seen is spin. What actual operational expenses have been reduced? Staff must be the most significant surely. The buy local thing being pushed by Tenby elsewhere is unoriginal and seems like an attempt to distract from council inaction. Check the number of meetings council has actually held, about one a week if you’re lucky. True business leadership is needed now.

Step In The Right Direction

Posted on 13-05-2020 10:24 | By

At least the 7.6% rate increase is still open for consultation and they are recognizing that people’s pain from Covid19 is significant AND they are acknowledging the fact that Council expenses need to be addressed.

revenue

Posted on 13-05-2020 09:38 | By dumbkof2

So going by TCC figures they are getting in the region of 48 mil a year in parking and airport fees. Where is all this money going. or is this amount just a number somebody thought of as an excuse to raise the rates. Would like to see a breakdown of these figures.

Bureaucrats

Posted on 13-05-2020 09:15 | By The Sage

So the Rate Payer is expected to keep propping up the wages of an already top heavy and overpaid Council while businesses are closing due to the events of the last few months. If you thought Devonport Road was a Ghost ship before, that’s nothing compared to what is happening now. Aucklanders are complaining of a 2% rates rise, our Council needs to get their head out of their backsides. Where do they think the money is going to come from after many people are already suffering extreme financial hardship.

Parking

Posted on 13-05-2020 08:58 | By

I would not worry about parking revenue being down, soon nobody will be back in town to pay at all

What planet is he on ???

Posted on 13-05-2020 08:56 | By The Caveman

" A proposal to consult on a 12.6 per cent rate increase was passed in March 2020 but this has been reduced to 7.6 per cent and is still open for consultation. " Is this chap for real a 12.6% rate increase !!! Oh we have reduced it to 7.6% - get real anything over 2.5% cannot be justified ................