Supplementary AGENDA  1R

 

Distributed on 26 February 2021

 

 

 

 

 

 

 

 

 

 

 

 

 

Extraordinary Council Meeting

                            

MONDAY 1 MARCH 2021

 

6.30PM

 

 

   


 

 

Extraordinary Council Meeting

1 March 2021

 

 

 

 

MEETING AGENDA – PRECIS

SUPPLEMENTARY ITEMS

 

 

The following attachment appears as late item as information required for the preparation of the report was not available at the time of distribution of the Business Paper.

 

 

1          Reports for Council Decision

 

ITEM                                                                                                                                         Page

 

C0321(1) Item 1  Harmonisation of Rates

                            (Attachment 5 - Rates Harmonisation Analysis $565 Minimum Rate)         3


 


Attachment 5

 

 

 

 

 

Harmonised Revenue Policy

 

Inner West Council – Statutory Minimum

 

 

26 February 2021


 

Introduction

Council requested further analysis with the inclusion of the 2021/22 statutory maximum minimum of $565.

 

Two options for analysis and comparison, both with $600k income movement from Business General to Business Mall:

              option 3 with maximum minimum of $565 for both Residential and Business

              option 4 with minimum of $850 for Residential and $820 for Business.


 

Minimum rates impact of different amounts

         The following slide details the impact of the 2 options for the Residential and Business categories in terms of:

            land value cap amount for each minimum

            number of assessments captured as minimum.

 

Note: for the next slide both Business Airport and Mall have high land values, hence were not affected by the minimum amount and therefore was not included in the analysis.


Minimum rates impact of di ferent amounts cont.

 

 

 

 

 

 

Category and Subcategory

Option 3

Minimum            Land Value                           Number of

Amount               Capped                            Minimum

Option 4

Minimum            Land Value            Number of

Amount                Capped                            Minimum

Business General Industrial Marrickville Industrial St Peters Industrial St Peters North Industrial Camperdown

Residential

565

141,082

441

820

204,756

653

565

100,483

114

820

145,833

122

565

99,714

3

820

144,718

14

565

99,662

1

820

144,642

1

565

100,054

3

820

145,212

6

565

439,993

24,185

850

661,937

30,945


 

Residential	Current Structure	Option 3	Option 4Residential options

 

 

 

 

 

 

 

 

Ashfield

Base Amount $727

Minimum $565

Minimum $850

Leichhardt

Minimum Amount $686

Minimum $565

Minimum $850

Marrickville

Minimum Amount $710

Minimum $565

Minimum $850


 

 

 

 

 

 

 

         The following slide details the change in total rates income for the former councils.

         The general trend still remains, regardless of the minimum amount, rates income moves from former Ashfield to Marrickville.

         Under the $565 minimum structure, option 3, more income moves from Ashfield to Marrickville than with option 4.

         Former Leichhardt income movement is slightly lower under the

$565 minimum than the $850 minimum.


 

 

 

 

 

 

 

 

Former

Current

Current

Option 3

Option 3

Option 4 Income

$850 M

$'000

Option 4 Income

$850 M

%

Councils

Residential

Income

$'000

Income

%

Income

$565 M

Income

$565 M

 

 

 

$'000

%

Ashfield

23,971 K

27%

18,828 K

21%

19,647 K

22%

Leichhardt

32,688 K

37%

33,997 K

38%

32,629 K

36%

Marrickville

30,653 K

35%

36,968 K

41%

37,517 K

42%

Total

87,312 K

100%

89,792 K

100%

89,792 K

100%


 

 

 

 

 

 

 

         The following slide details the $ range of increases and decreases for the former councils.

         With higher minimum of $850, former Marrickville will experience more increases at the higher $ range.

         Former Ashfield will experience a reduction on both minimum options, greater under option 3.

         Former Leichhardt will experience higher increases with minimum amount of $565.


 

 

 

 

Residential

Option 3

 

 

 

 

 

Former Council

Marrickville

 

Ashfield

 

Leichhardt

 

$ Rate Increase Range

# of Assessment

% of Assessment

# of Assessment

% of Assessment

# of Assessment

% of Assessment

Below $-400

0

0.0%

6,705

41.4%

-

0.0%

$-400 to $-200

-

0.0%

5,933

36.6%

-

0.0%

$-200 to $-75

12,306

37.0%

1,473

9.1%

5,692

24.2%

$-75 to $0

376

1.1%

617

3.8%

506

2.1%

$0 to $75

423

1.3%

603

3.7%

2,230

9.5%

$75 to $200

965

2.9%

639

3.9%

13,995

59.4%

$200 to $400

10,462

31.5%

151

0.9%

912

3.9%

Above $400

8,689

26.2%

92

0.6%

217

0.9%

 

33,221

100%

16,214

100%

23,552

100%

 

 

Residential

Option 4

 

 

 

 

 

Former Council

Marrickville

 

Ashfield

 

Leichhardt

 

$ Rate Increase Range

# of Assessment

% of Assessment

# of Assessment

% of Assessment

# of Assessment

% of Assessment

Below $-400

0

0.0%

4,014

24.8%

35

0.1%

$-400 to $-200

1

0.0%

6,487

40.0%

269

1.1%

$-200 to $-75

1

0.0%

3,919

24.2%

5,493

23.3%

$-75 to $0

3

0.0%

1,323

8.2%

10,214

43.4%

$0 to $75

2

0.0%

392

2.4%

583

2.5%

$75 to $200

18,858

56.8%

44

0.3%

6,935

29.4%

$200 to $400

13,494

40.6%

13

0.1%

4

0.0%

Above $400

861

2.6%

22

0.1%

18

0.1%

 

33,221

100%

16,214

100%

23,552

100%


 

 

 

 

 

 

 

 

Residential

2020/21

 

Land Values

IWC Proposed

minimum $565

IWC Proposed

minimum $850

 

Ashfield

 

Leichhardt

 

Marrickville

500,000

722

850

1,229

686

710

750,000

1,084

963

1,477

1,008

778

1,000,000

1,445

1,284

1,724

1,344

1,037

1,500,000

2,167

1,926

2,219

2,016

1,556

3,000,000

4,334

3,852

3,702

4,032

3,111

5,000,000

7,224

6,421

5,681

6,720

5,185


 

 

 

 

 

 

         Former Ashfield will experience a reduction under both options, with a greater reduction under option 3, $565 minimum, due to current rate structure with base amount of $727, and also with lower land value comparatively with the other former councils.

         Former Leichhardt current structure is minimum amount $686, in option 3 the lower percentile will experience a decrease due to lower minimum at $565 before higher ad valorem kicked in, and vice versa under option 4.

         Former Marrickville will generally experience increases except for lower percentile in option 3, due to higher current minimum amount of $710, with the greatest impact being option 4.


 

 

 

Residential

Assessments

2019 Land values

2020-21

Rates

Option 3 rates

Option Change

3

$

Option 3 % impact

Option 4 rates

Option 4 Change $

Option 4 Change %

 

Ashfield

16,214

 

 

 

 

 

 

 

 

0

Lowest

1

1,150

322

565

243

75.6%

266

(

56)

(17.4%)

0.1

10th percentile

1,621

191,884

921

565

(

356)

(38.7%)

850

(

71)

(7.7%)

0.2

20th percentile

1,621

265,998

994

565

(

429)

(43.2%)

850

(

144)

(14.5%)

0.3

30th percentile

1,621

317,364

1,046

565

(

481)

(46.0%)

850

(

196)

(18.7%)

0.4

40th percentile

1,621

370,000

1,097

565

(

532)

(48.5%)

850

(

247)

(22.5%)

0.5

50th percentile

1,621

500,000

1,217

709

(

507)

(41.7%)

850

(

367)

(30.1%)

0.6

60th percentile

1,621

868,000

1,584

1,241

(

343)

(21.6%)

1,103

(

481)

(30.3%)

0.7

70th percentile

1,621

1,050,000

1,773

1,517

(

257)

(14.5%)

1,348

(

425)

(24.0%)

0.8

80th percentile

1,621

1,230,000

1,942

1,763

(

179)

(9.2%)

1,567

(

375)

(19.3%)

0.9

90th percentile

1,621

1,570,000

2,278

2,254

(

24)

(1.1%)

2,003

(

275)

(12.1%)

1.0

Highest

1,621

13,400,000

13,989

19,360

5,370

38.4%

17,207

3,218

23.0%

 

Leichhardt

23,552

 

 

 

 

 

 

 

 

0

Lowest

1

3,750

5

565

560

11110.3%

213

207

4116.3%

0.1

10th percentile

2,355

214,816

686

565

(

121)

(17.6%)

850

164

23.9%

0.2

20th percentile

2,355

345,455

686

565

(

121)

(17.6%)

850

164

23.9%

0.3

30th percentile

2,355

597,442

779

839

60

7.8%

850

71

9.1%

0.4

40th percentile

2,355

824,000

1,090

1,173

83

7.6%

1,043

(

47)

(4.3%)

0.5

50th percentile

2,355

931,000

1,243

1,336

93

7.5%

1,188

(

55)

(4.5%)

0.6

60th percentile

2,355

1,030,000

1,384

1,488

104

7.5%

1,323

(

62)

(4.5%)

0.7

70th percentile

2,355

1,180,000

1,572

1,690

118

7.5%

1,502

(

70)

(4.5%)

0.8

80th percentile

2,355

1,340,000

1,788

1,922

134

7.5%

1,708

(

80)

(4.5%)

0.9

90th percentile

2,355

1,600,000

2,137

2,297

160

7.5%

2,042

(

95)

(4.5%)

1.0

Highest

2,355

24,200,000

32,525

34,963

2,438

7.5%

31,075

(

1,449)

(4.5%)

 

Marrickville

33,221

 

 

 

 

 

 

 

 

0

Lowest

1

48,323

247

565

318

129.1%

173

(

74)

(29.8%)

0.1

10th percentile

3,322

176,878

710

565

(

145)

(20.4%)

850

140

19.7%

0.2

20th percentile

3,322

233,272

710

565

(

145)

(20.4%)

850

140

19.7%

0.3

30th percentile

3,322

303,898

710

565

(

145)

(20.4%)

850

140

19.7%

0.4

40th percentile

3,322

567,000

710

819

109

15.4%

850

140

19.7%

0.5

50th percentile

3,322

741,000

765

1,066

301

39.3%

948

182

23.8%

0.6

60th percentile

3,322

840,400

871

1,214

342

39.3%

1,079

208

23.8%

0.7

70th percentile

3,322

932,000

967

1,345

379

39.2%

1,196

229

23.7%

0.8

80th percentile

3,322

1,070,000

1,110

1,546

436

39.3%

1,374

264

23.8%

0.9

90th percentile

3,322

1,270,000

1,317

1,835

518

39.3%

1,631

314

23.8%

1.0

Highest

3,322

36,500,000

37,853

52,733

14,881

39.3%

46,870

9,017

23.8%


 

 

 

 

 

 

         In option 3, the percentage range is between minus 48.5% to plus 39.3%, with net percentage range of minus 96.3%. The dollar range is between minus $532 to plus $518, with net dollar range  of minus $947.

           In option 4, the percentage range is between minus 30.3% to plus 23.9%, with net percentage range of plus 48.8%. The dollar range is between minus $481 to plus $314, with net dollar range of minus $834.

         Option 4 has overall less impact when compared to option 3.


 

 

 

                                                                 

 

                                                                  

                                                                    


 

 

 

 


Rate Structure Option 3						
Median residential property value		Median residential rate
$ 789,000		$	1,137
		
		
		
		
		
		
								
Upper quartile residential property value		Upper quartile residential rate (75th percentile)
$1,100,000		$	1,589
		
		
		
		
		
		
					

Proportion of residential ratepayers paying
Minimum Residential rate		minimum rate
$	565		33%
		
		
		
		
		
		
					

Number of residential assessments with increases
Average Residential rate		over $3.50 per week
$	1,236		21,113
		
		
		
		
		
		

                                                                  Rate Structure Option 4						
Median residential property value		Median residential rate
$ 789,000		$	1,011
		
		
		
		
		
		
								
Upper quartile residential property value		Upper quartile residential rate (75th percentile)
$1,100,000		$	1,413
		
		
		
		
		
		
					
Proportion of residential ratepayers paying
Minimum Residential rate		minimum rate
$	850		42%
		
		
		
		
		
		
					
N0. of residential assessments with increases
Average Residential rate		over $3.50 per week
$	1,230		16,777


Former Council Subcategory	Current Structure	Option 3	Option 4

 

 

 

 

 

 

 

 


Ashfield

General

Minimum Amount $820

Minimum $565

Minimum $850

Leichhardt

General

Minimum Amount $686

Minimum $565

Minimum $850

Marrickville

General

Ad valorem

Minimum $565

Minimum $850

Marrickville

Industrial Marrickville

Ad valorem

Minimum $565

Minimum $850

Marrickville

Industrial St Peters

Ad valorem

Minimum $565

Minimum $850

Marrickville

Industrial St Peters North

Ad valorem

Minimum $565

Minimum $850

Marrickville

Industrial Camperdown

Ad valorem

Minimum $565

Minimum $850

Marrickville

Marrickville Metro

Ad valorem

Minimum $565

Minimum $850

Marrickville

Airport

Ad valorem

Minimum $565

Minimum $850


 

 

 

 

 

 

 

       The following slide details the change in total rates income for the former councils.

       The movement of income between option 3 and 4 are very similar, with income shifting from former Leichhardt to former Marrickville and former Ashfield.

       Both options includes income movement of $600k from Business General to Business Mall.


 

 

 

 

 

 

Former

Current

Current

Option 3

Option 3

Option 4

Option 4

Councils

Income

Income %

Income

Income

Income

Income

Business

$'000

 

$565 M

$565 M

$850 M

$850 M

General

 

 

$'000

%

$'000

%

Ashfield

4,921 K

20%

5,249 K

21%

5,249 K

21%

Leichhardt

12,580 K

50%

9,558 K

39%

9,579 K

39%

Marrickville

7,544 K

30%

9,638 K

39%

9,618 K

39%

Total

25,045 K

100%

24,445 K

100%

24,445 K

100%


 

 

 

 

 

 

 

         The following slide details the range of increases and decreases for the former councils.

         In both options, former Marrickville will experience most increases above $400, with option 4 slight greater.

         Former Leichhardt will see significant reductions below $400, with both options having a very similar impact.

         Former Ashfield will also experience increases above $400, with 32% in option 3 and 26% in option 4.


 

 

 

 

Business General

Option 3

 

 

 

 

 

Former Council

Marrickville

 

Ashfield

 

Leichhardt

 

$ Rate Increase Range

# of Assessment

% of Assessment

# of Assessment

% of Assessment

# of Assessment

% of Assessment

Below $-800

0

0.0%

-

0.0%

1,024

60.0%

$-800 to $-400

1

0.1%

1

0.1%

290

17.0%

$-400 to $-200

1

0.0%

111

13.4%

191

11.2%

$-200 to $0

1

0.0%

44

5.3%

200

11.7%

$0 to $200

132

6.9%

160

19.3%

2

0.1%

$200 to $400

227

11.9%

250

30.1%

0

0.0%

$400 to $800

704

36.7%

143

17.2%

-

0.0%

Above $800

850

44.4%

121

14.6%

-

0.0%

 

1,917

100%

830

100%

1,708

100%

 

 

Business General

Option 4

 

 

 

 

 

Former Council

Marrickville

 

Ashfield

 

Leichhardt

 

$ Rate Increase Range

# of Assessment

% of Assessment

# of Assessment

% of Assessment

# of Assessment

% of Assessment

Below $-800

0

0.0%

-

0.0%

1,050

61.5%

$-800 to $-400

1

0.1%

1

0.1%

281

16.5%

$-400 to $-200

1

0.0%

-

0.0%

129

7.5%

$-200 to $0

1

0.0%

156

18.8%

54

3.2%

$0 to $200

58

3.1%

243

29.3%

192

11.3%

$200 to $400

214

11.2%

214

25.8%

0

0.0%

$400 to $800

862

45.0%

118

14.2%

-

0.0%

Above $800

779

40.7%

98

11.8%

-

0.0%

 

1,917

100%

830

100%

1,708

100%


 

 

 

 

 

 

 

 

 

Business General

2020/21

 

Land Values

IWC Proposed

minimum $565

IWC Proposed

minimum $820

 

Ashfield

 

Leichhardt

 

Marrickville

500,000

2,030

2,002

1,803

2,517

1,543

750,000

3,045

3,004

2,705

3,775

2,314

1,000,000

4,061

4,005

3,606

5,033

3,085

1,500,000

6,091

6,007

5,409

7,550

4,628

3,000,000

12,182

12,014

10,818

15,100

9,256

5,000,000

20,303

20,024

18,030

25,166

15,427


 

 

 

 

 

 

         Former Ashfield will experience slightly higher increases and decreases under option 3, while option 4 will have the least impact comparatively with current structure minimum amount of

$820.

         Former Leichhardt current structure is a minimum of $686, in both options former Leichhardt will experience a decrease due to lower ad valorem.

         Former Marrickville will generally experience increases due to higher ad valorem, with greater increase under option 4.


	


Business	


Assessments	

2019 Land values	

2020-21
Rates	

Option 3 rates	

Option 3 Change $	

Option 3 % impact	

Option 4 rates	

Option 4 Change $	

Option 4 Change %
	Ashfield	831								
0	Lowest	1	243	623	565	(	58)	(9.4%)	707	84	13.4%
0.1	10th percentile	83	125,574	829	565	(	264)	(31.9%)	820	(	9)	(1.1%)
0.2	20th percentile	83	240,960	902	968	66	7.3%	955	53	5.9%
0.3	30th percentile	83	604,100	1,826	1,926	100	5.5%	1,899	73	4.0%
0.4	40th percentile	83	742,600	2,526	2,727	201	7.9%	2,690	163	6.5%
0.5	50th percentile	83	878,500	3,055	3,301	247	8.1%	3,256	201	6.6%
0.6	60th percentile	83	1,100,000	3,720	4,034	314	8.4%	3,978	258	6.9%
0.7	70th percentile	83	1,380,000	4,845	5,234	389	8.0%	5,162	317	6.5%
0.8	80th percentile	83	1,946,000	6,983	7,553	570	8.2%	7,449	466	6.7%
0.9	90th percentile	83	3,416,000	12,817	13,871	1,053	8.2%	13,680	863	6.7%
1.0	Highest	83	51,516,845	193,188	192,668	(	520)	(0.3%)	393,101	199,913	103.5%
	Leichhardt	1,710								
0	Lowest	1	1,892	615	565	(	50)	(8.1%)	437	(	178)	(29.0%)
0.1	10th percentile	171	149,635	760	584	(	176)	(23.2%)	820	60	7.9%
0.2	20th percentile	171	311,868	1,508	1,140	(	368)	(24.4%)	1,125	(	384)	(25.5%)
0.3	30th percentile	171	521,552	2,288	1,752	(	536)	(23.4%)	1,728	(	560)	(24.5%)
0.4	40th percentile	171	725,200	3,293	2,522	(	772)	(23.4%)	2,487	(	806)	(24.5%)
0.5	50th percentile	171	910,000	4,330	3,313	(	1,017)	(23.5%)	3,268	(	1,062)	(24.5%)
0.6	60th percentile	171	1,100,480	5,284	4,061	(	1,224)	(23.2%)	4,005	(	1,280)	(24.2%)
0.7	70th percentile	171	1,310,000	6,500	4,994	(	1,505)	(23.2%)	4,926	(	1,574)	(24.2%)
0.8	80th percentile	171	1,730,000	8,719	6,700	(	2,019)	(23.2%)	6,608	(	2,111)	(24.2%)
0.9	90th percentile	171	2,720,000	14,035	10,785	(	3,251)	(23.2%)	10,637	(	3,399)	(24.2%)
1.0	Highest	171	56,200,000	296,983	228,203	(	68,780)	(23.2%)	318,373	21,390	7.2%
	Marrickville	3,199								
0	Lowest	1	640	2	565	563	28323.7%	718	716	36019.5%
0.1	10th percentile	320	146,904	525	644	119	22.6%	820	295	56.1%
0.2	20th percentile	320	340,200	1,332	1,584	252	18.9%	1,562	230	17.3%
0.3	30th percentile	320	619,200	2,172	2,681	509	23.4%	2,646	473	21.8%
0.4	40th percentile	320	759,600	2,663	3,313	650	24.4%	3,268	605	22.7%
0.5	50th percentile	320	874,000	3,263	3,910	647	19.8%	3,877	613	18.8%
0.6	60th percentile	320	1,026,080	3,946	4,673	727	18.4%	4,627	682	17.3%
0.7	70th percentile	320	1,250,000	5,212	5,829	616	11.8%	5,767	554	10.6%
0.8	80th percentile	320	1,666,000	7,208	7,826	619	8.6%	7,769	562	7.8%
0.9	90th percentile	320	2,610,000	11,464	12,366	902	7.9%	12,255	791	6.9%
1.0	Highest	320	66,700,000	417,982	417,982	-	0.0%	554,932	136,950	32.8%

A l Busines                                              snapshot analysis cont.


 

 

 

 

 

         In option 3, the percentage range is between minus 31.9% to plus 24.4%, with net percentage range of minus 24.8%. The dollar range is between minus $3,251 to plus $1,053, with net dollar range of minus $3,152.

         In option 4, the percentage range is between minus 25.5% to plus 56.1%, with net percentage range of plus 40.2%. The dollar range is between minus $3,399 to plus $863, with net dollar range of minus $3,925.

         Option 3 has less overall impact when compared to option 4.


 

 

 

 

 


                                                                    



 

 

 

 

 

 


Rate Structure Option 3						
Median business property value		Median business rate
$ 888,000		$	3,631
		
		
		
		
		
		
								
Upper quartile business property value		Upper quartile business rate (75th percentile)
$1,430,000		$	6,334
		
		
		
		
		
		
								
Minimum business rate		Proportion of ratepayers paying minimum
$	565		10%
		
		
		
		
		
		
					
Number of business assessments increasing
Average business rate		more than 10.0%
$	6,325		2,110
		
		
		
		
		
		

                                                             Rate Structure Option 4						
Median business property value		Median business rate
$ 888,000		$	3,336
		
		
		
		
		
		
								
Upper quartile business property value		Upper quartile business rate (75th percentile)
$1,430,000		$	5,527
		
		
		
		
		
		
								
Minimum business rate		Proportion of ratepayers paying minimum rate
$	820		14%
		
		
		
		
		
		
					
Number of business assessments increasing
Average business rate		more than 10.0%
$	6,396		2,291