Rate revenue planned to stay at last year’s level
The City of Fremantle has signalled its intention to have the revenue raised from rates in the coming 2020-21 financial year maintained at the same level as the previous 2019-20 financial year (i.e. there will be no increase in rate revenue).
The City advertised its proposed rates for 2020-21 on Friday 15 May, with submissions invited until 5pm, Tuesday 9 June.
The final decision on rates will be made by the council when it considers and adopts the 2020-21 annual budget.
Just as it has with other sectors of our community, the COVID-19 pandemic has had a significant financial impact on the City of Fremantle. We estimate COVID-19 will cost the City more than $6 million in lost revenue this financial year, made up of car parking, rent from commercial properties and fees and charges.
While we always endeavour to keep our rates as low as possible to minimise the financial impact on our ratepayers, we also need to ensure we raise enough revenue to provide the services and facilities our community needs and expects.
Maintaining rate revenue at the same level as last year, excluding interim rates, will help us strike a balance between minimising the cost to ratepayers while also ensuring we have enough revenue to fund essential services and facilities that will help Fremantle bounce back from COVID-19.
Local government rates are calculated based on the Gross Rental Value (GRV) of each individual property, as determined by the state government’s Valuer General, multiplied by a rate in the dollar set by the local government.
The Valuer General revalues the GRV of properties every three years, and this year is a revaluation year. That means the GRV on some properties may go up, while for others GRV may go down.
As a general rule GRV goes up or down in line with changes in the property market. This revaluation year will see the average values decrease based on recent trends.
Based on the data received from Landgate, Gross Rental Values in the City of Fremantle have gone down by around 10 per cent on average, therefore the rate in the dollar will have to be increased by around 10 per cent to ensure the overall amount of revenue raised is maintained at the same level as last year.
If the rate in the dollar set by the council was frozen at the same rate as the previous year, it would translate into a net rate revenue decrease for the City of approximately $4.1 million.
While average Gross Rental Values have gone down, the costs to local governments in providing services and facilities for the community have continued to rise.