Thursday, 8 December 2016
It would be foolish to think that the issue of Clarence Valley Council rates and charges has been permanently settled since the local government election in September this year.
The constant pressure of cost-shifting by state and federal governments means that regional councils in particular are prone to financial stress.
The fact that during previous elected terms Council in the Chamber appears to have agreed to expenditure which exacerbated this situation is regrettable but remains something that has to be faced.
I await the beginning of the 2017 local government year with interest.
The current state of play……
The Daily Examiner, 19 October 2016:
NEW Clarence Valley Mayor Jim Simmons has used his casting vote twice to ensure his council applied for a special rate variation.
At Tuesday's council meeting a Mayoral Minute calling for an organisation review of the council and a general manager's report outlining a Fit for the Future Improvement Plan and Special Rate Variation were fiercely debated.
The Mayoral minute ostensibly called for the appointment of a consultant to review the council's organisation, but quickly moved to debate on the SRV.
In his minute the mayor said the council needed make an application for an SRV in case it becomes necessary once the review was completed.
In debate he repeatedly stressed this was not an application for an SRV. He said this could only happen at budget time in June next year.
But for some councillors the SRV was totally off limits.
Councillors Peter Ellem and Greg Clancy said they would not vote in favour of any motion in favour of an SRV.
And Cr Andrew Baker said an SRV was an admission the council was not prepared to do the hard work in balancing the budget.
The voting was Crs Jason Kingsley, Richie Williamson, Arthur Lysaught and Jim Simmons in favour.
Against: Crs Baker, Ellem, Clancy and Debrah Novak.
The Daily Examiner, 1 December 2016:
CLARENCE Valley Council has missed its State Government-imposed deadline to submit a plan to show it will become Fit for the Future.
At an extraordinary meeting in Maclean yesterday, councillors voted down a staff-prepared proposal which included an application for a 9% special rates variation.
The deadline for the council to submit its proposal to the Office of Local Government was midnight last night, which the council general manager Scott Greensill said could not be met.
The gallery was filled with council staff, who came to see the outcome, which according to information in the report to the meeting could result in the loss of 63 jobs at the council over the next nine years.
Mayor Jim Simmons, who spoke in favour of the plan, used his casting vote to defeat the proposal.
His reasoning was that a councillor missing from the meeting, Cr Greg Clancy, was a strong opponent of the SRV proposal.
"This proposal would only be voted down at the next meeting in December, so I will vote against it now," he said.
Cr Andrew Baker foreshadowed a lengthy nine-point motion during question time. An amendment from Cr Karen Toms reduced this to eight points when he agreed to remove a section relating to council's tourism services.
This became the motion on the defeat of the officer's recommendation……
Cr Peter Ellem supported Cr Baker's motion.
He said the opposition to it was coming from a rump of the former council and council staff who had failed to listen adequately to the new members of council and the public.
He said the job losses and figures in the report were designed to scare councillors into voting in favour of an SRV, which he said the community could not afford.
That final Council resolution set out below is one that was amended by Williamson/Lysaught during the preceding motion vote which occurred sometime between 3.10pm and 4.06pm.
The Mayor adjourned the meeting at 4.06 pm and resumed at 4.13 pm.
COUNCIL RESOLUTION – 13.063/16
1. Adopt a Fit for the Future Continual Compliance Policy for immediate implementation and a Nil-Deficit General Fund Budget Policy for 2017/18 and subsequent years with each General Fund Budget to encompass at least:
a. Operating Performance Ratio at or better than breakeven to satisfy Benchmark 1.
b. Building and Infrastructure Renewal at or better than 100% to meet or exceed Benchmark 3.
c. Infrastructure Backlog Ratio of 2% or less to satisfy Benchmark 5, after an initial utilization of
$17.7 million of own Capital Reserves is applied to infrastructure backlog reduction by the
actions required at 3 and 4 below.
d. Asset Maintenance Ratio of 100% or more to meet or exceed Benchmark 5.
e. Already-adopted efficiency measures, revenue increases, expenditure reductions and other
measures adopted for financial sustainability purposes.
2. Commence Fit for the Future Continuing Compliance immediately by:
a. Adjusting the 2016/17 adopted budget deficit by any amounts realised from the adoption of
this resolution and,
b. Adjusting current budget projections to include the results of a Business Case review of the
Depot Rationalisation Project that is to include current known costs and projections together
with the items at 7a, 7b and 7c below and with this revised business case to be reported to
Council February 2017 and,
c. Implementing the actions required in following Sections 3 to 8 inclusive.
3. Adopt a Fleet Financing Policy that requires all fleet renewals and acquisitions to be financed by external commercial financing where item cost is prorated monthly over the planned economic life of the asset.
4. Create an Infrastructure Backlog Accelerated Reduction Reserve of $17.7 million by the transfer of all of the Fleet Reserve Fund of $10 million or such other final amount when calculated and by additional capital to emerge from the adoption of the Fleet Financing Policy and:
a. Apply Internal Fleet Hire funds emerging from this Fleet Financing Policy estimated: $3.53m
remaining 6 months 2016/17, $3.33m 2017/18, $1.1 million 2018/19, $0.41 million 2019/20,
$0.14 million 2020/21 for an estimated total $8.6 million over 54 months and subject to final
calculation amount to be inserted here to firstly reach the $17.7 million required for the
Infrastructure Backlog Accelerated Reduction Reserve amount and then to apply to other
Benchmark shortfalls and,
b. Apply fleet disposal income funds emerging at end of economic life disposal of fleet items
estimated at $8 million over 48 to 60 months and subject to final calculation amount to be
inserted here to firstly reach the $17.7 million required for the Infrastructure Backlog
Accelerated Reduction Reserve amount and then to apply to other Benchmark shortfalls.
5. After accounting for the adopted forecast reductions that will result from depot rationalisation natural attrition and other adopted efficiency savings measures, develop a workforce model that results in no nett reduction of adjusted workforce numbers with such model to be developed by inclusion of selected reductions to consultant and contract engagements in favour of maintaining at least current Council FTE workforce numbers.
6. Receive a report to the February 2017 Ordinary meeting and to subsequent meetings as necessary with such report to include:
a. Options and variations available for delivery of this resolution and,
b. Effects of implementation on subsequent budget forecasts and,
c. The capability and constraints of this resolution being implemented by existing Council
management expertise alone and,
d. The likely cost and benefit of further resolving the implementation of this resolution by the
engagement of external administration services.
7. Adopt a Business Case Reporting to Council Policy for pre-acquisition reporting on all proposed capital acquisitions of $100,000 or above to show all financial costs and benefits and alternatives if any with each report to include:
a. The Cost of Funds using best commercial borrowing rates available to Council at the time
b. The Cost of Funds using best commercial investment rates available to Council at the time
c. Any depreciation amounts attributable to the expected life of the acquisition.
8. Make a Fit for The Future Submission to the Office of Local Government showing the amended budget results and forecasts resulting from adoption of this resolution Sections 1 to 7 inclusive together with any other already-adopted future savings and revenue-increase measures to be implemented by Council to achieve financial sustainability.
Cr Williamson and Cr Lysaught left the meeting at 4.41 pm prior to the voting taking place. [my red bolding]
Voting recorded as follows
For: Simmons, Ellem, Novak, Toms, Baker