When setting categories and determining appropriate rates and charges the underlying principles that every local government must consider the income earning capacity of land.
It is important to note that the introduction of NOOR categories was also a key recommendation from financial advisers as a fair and equitable way to help achieve council's long-term financial management goals.
Going inside the heated Livingstone budget decision
Earlier this year there was a push from some councillors to remove the NOOR categories completely. Fortunately after careful consideration of all the facts common sense prevailed and these important categories were retained. The one change those councillors did make way to reduce the differential rate for the NOOR categories back to the same level as last year and make up the difference by increasing the rate rise for all other rating categories.
This one change will not alter the underlying strength of what has been acknowledged as a very sound overall budget. However for the 70 per cent of ordinary home-owner ratepayers, first-home owners, 'battlers' and pensioners there is bound to be some disappointment the planned 1.5 per cent General Rate rise was increased to 2.1 per cent as a result.
The intent of year's budget was to give these home owners some relief. To help achieve NOOR differential in General Rates was to increase by an average of just 59 cents above that paid by Owner Occupied Residential categories.
Put in perspective Rockhampton currently has an equivalent NOOR category at approximately 15 per cent higher than owner occupied residential properties.
The proposed increase would have limited Livingstone's differential at only 4.9% higher. When combined with utilities and charges that overall difference is closer to 2 per cent.
With almost 30 per cent of our residential properties falling into the NOOR income producing category nationally recognised as a commercial activity, the additional income from this category would have been around $300,000. Not a huge amount of money in the context of the overall budget, but over the 10-year forecast period an amount that would make a significant difference for the majority of ratepayers.
Interestingly fewer than 9 per cent of actual shire residents own those NOOR properties; the overwhelming majority of these properties are owned by investors from outside our shire or interstate. This reinforces that the Capricorn Coast remains a highly attractive proposition for investors from around Australia.
Given NOOR properties are also eligible for considerable tax concessions it does raise the question of whether the originally planned average increase of 59 cents above Owner Occupied Residential was excessive or unreasonable.