A plan to repay part of Hastings District Council's $2 million surplus to ratepayers was rejected and labelled an election campaign ploy, the deputy mayor Cynthia Bowers said yesterday.
The council met to review details of its interim financial report for the year ending June 30, 2012 and to determine how it should spend the left-over cash. After taking out costs of additional projects, the council was left with a surplus of just under $1.5 million.
Councillor Wayne Bradshaw suggested moving $1 million of the surplus into a "rates stabilisation account" that would be credited against the 2013/14 rates, possibly bringing rates down to 2 per cent. He said it would recognise the "over collection" of rates by the council for interest and roading costs, which had not been spent.
But deputy mayor Cynthia Bowers said reducing rates next year would mean a hike was likely the following year to catch up on the finance needed to keep the district operating. The council also heard from its staff that a priority should be using the extra money to retire debt.
"This is incredibly irresponsible and I am totally against it. I also note that this is being proposed for the 2013/14 financial year when we have an election on at the same time. We have a surplus of $2 million and the alternative is to cut back the budget where the flow-on effect may be that we face a deficit the next year and we will be in a catch-up situation."
Cr Simon Nixon supported the proposal and said any surplus the council accounted for was owned by the ratepayers it represented. "The reality is, that insurance costs more, and so we add it to the rates. This is the same thing operating in the opposite direction and a good case to pass the surplus back to the ratepayers."
Cr Bradshaw said he believed the council had over-collected $900,000 in the past financial year, money earmarked for road-maintenance projects with the New Zealand Transport Agency.
Council staff said the money needed to be held because NZTA had not indicated how much funding it would chip in towards road works. In the future, the council could be expected to pay more to keep the roading network up to scratch.
The council laughed when Cr Bradshaw replied to Cr Bowers' comments about the initiative being released during an election year.
"The fact that next year is an election year did not enter my mind," Cr Bradshaw said. "I am an amateur politician and I don't like to play to the crowds as some other people may do."
The council voted against Cr Bradshaw's proposal and instead for the use of the $1.5 million to repay debt on CBD developments.