As ratepayers continue to have their say about a proposed 35 per cent rate increase it would appear the hike will not alone suffice, as council is planning a multi-million dollar loan.
Meanwhile questions are being raised as to whether council is doing enough to reduce costs, particularly in the area of staffing.
Submissions on Bega Valley Shire Council's draft financial documents closed on June 1 and they, along with the proposal for a 35 per cent general rate increase from July 1, 2023, will come back to council to be adopted.
The rate increase, if agreed by council, will need approval by IPART (Independent Pricing and Regulatory Tribunal) later this year, at which point there will be a chance for community input.
Mayor Russell Fitzpatrick said that in his discussions with the community "people understood" the need for the rate increase.
"They may not like it, but people understand and realise that you have to have it if you want to get things done," he said.
He believes the increase needed to be in one hit - 35 per cent rather than three years of 10 per cent increases.
But will the rate increase fix Bega Valley Shire Council's financial problems in the longer term?
It would appear that the 35 per cent rate increase alone is not sufficient because council has plans to take out a $34m loan as well as part of its 'maintain' scenario.
Under the projections for the 35 per cent increase (the 'maintain' scenario) council's general fund doesn't come out of negative territory until financial year 2027 and then immediately dives back in for another two years.
When ACM sought clarification from council over cash flows in the general fund, a council spokeswoman said bridge replacements were at the heart of the problem.
Regarding the general fund closing cash position, included in the maintain model is over $30m of critical bridge replacements. To fund these projects, we will fully exhaust councils unrestricted funds and then have proposed a loan of $34m, which is also included in the model to allow for these works to be undertaken.- Bega Valley Shire Council spokeswoman
"Regarding the general fund closing cash position, included in the 'maintain' model is over $30m worth of critical bridge replacements," she said.
But she went on to explain that to fund these projects council would fully exhaust it's unrestricted funds. This is something that would leave council in a precarious financial position.
"And then (council) have proposed a loan of $34m, which is also included in the model to allow for these works to be undertaken," the spokeswoman said.
Prior to the proposed 35 per cent increase, at the end of June 2022, the general fund is predicted to be $3.8m in the red but at the end of financial year 2023 it will be $9.45m in the red, dragging the entire consolidated funds into the red to the tune of $6.58m.
The loan is proposed to be taken out in financial year 2023/24, immediately after the proposed 35 per cent rate increase. At that stage loan repayments in the general fund will total almost $4m.
In the consolidated fund the rate increase would see the fund hover around $180,000 and $4.1m in the black between financial years 2024 and 2032.
In regards to council staffing, numbers appear to have increased significantly over the last term of council.
In 2016 council said it had 360 staff, but now has between 345 full-time-equivalent (FTE) staff, plus 158 contract staff and 65 casuals as shown in the draft resourcing strategy. However the draft delivery program appears to show 411.8 FTEs.
We asked council for clarification on the staff numbers.
There has been an increase in grant funded contract staff over the last two years related to our bushfire recovery response and the numbers of contract staff are expected to change as capital projects are finalised and our recovery support service concludes.- Bega Valley Shire Council spokeswoman
"The workforce snapshot provided in the resourcing strategy is a point in time view of our organisation taken in January this year," the council spokeswoman said.
"It looks at the total number of people employed by council on that day, regardless of whether they were full time, part time, permanent or casual."
The spokeswoman said the delivery program/operational plan was also point in time snapshot but it differed because it was of the FTEs delivering each service.
"It is not a headcount as full time staff are counted as one, while a part time staff member will be counted as a percentage of one based on their hours.
"Trainees, cadets and apprentices are all engaged on fixed term contracts. Cadets for six years, apprentices for four years and trainees for two years," she added.
The 158 contract staff include nine cadets, 15 trainees and three apprentices.
"There has been an increase in grant funded contract staff over the last two years related to our bushfire recovery response and the numbers of contract staff are expected to change as capital projects are finalised and our recovery support service concludes," the spokeswoman said.
ACM also questioned the different staff costs for financial year 2022/23, between the council's draft delivery program ($39.48m) and draft resourcing strategy ($42.49m).
The difference of some $3m is because some positions are grant funded.
"The capitalisation of wages against grant funded capital projects is the variation between the two employee costs outlined. The resourcing strategy includes both operational and capital wages," the spokeswoman said.
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