Frequently Asked Questions

Under what legal authority does Council levy rates? 

The legislative authority and responsibilities of local governments are outlined by Federal Government as follows:

Local government in Australia's Federation

Local government bodies have existed in Australia since the establishment of the Adelaide Corporation (now the City of Adelaide) in 1840. Across Australia, there are now about 560 local government bodies that promote local interests and deliver important services and infrastructure. These bodies are very diverse: the areas they cover range from less than a square kilometre to almost 380,000 square kilometres, and their populations range from a few hundred to more than 1 million. 

Local government is a legislative responsibility of the States and Territories and is recognised in the Constitution of each State. State parliaments determine the roles and responsibilities of local governments, and those responsibilities vary from State to State. 

Chapter 7 of the Constitution of Queensland 2001» notes the following in regard to the authority and responsibilities of local governments: 

Chapter 7 Local Government
Part 1 System of local government
70 System of local government
  (1) There must be a system of local government in Queensland. 
  (2) The system consists of a number of local governments.
71
Requirements for a local government
  (1) A local government is an elected body that is charged with the good rule and local government of a part of Queensland allocated to the body.

The Local Government Act 2009», promulgated by the Queensland Parliament in terms of the Queensland Constitution, says the following: 

9
 Powers of local governments generally
  (1) a local government has the power to do anything that is necessary or convenient for the good rule and local government of its local government area.
94
Power to levy rates and charges
  (1) Each local government: 
     (a) must levy general rates on all rateable land within the local government area; and
     (b) may levy:
          (i) special rates and charges; and
          (ii) utility charges; and
          (iii) separate rates and charges. 
262
 Powers in support of responsibilities
     (c) power to charge for a service or facility, other than a service or facility for which a cost-recovery fee may be fixed. 

When does Council issue Rate Notices?

Council's financial year runs from 1 July to 30 June, and Council issues Rate Notices twice each financial year:

  • in mid-August with a payment date in mid-September; and
  • in mid-February with a payment date in mid-March.

How much is Council's Pensioner Rates Rebate?

Council offers a reduction in rates to eligible pensioners in the form of a Pension Rates Rebate which is currently $140 per year. The State Government Pension Rates Rebate is currently 20% of Rates up to a maximum of $200 per year. 

What do ratepayers receive for their General Rates?

1. Road Works

  • Construction of New Roads
  • Maintenance of Gravel Roads
  • Sealing of Roads
  • Bridge Construction
  • Mowing Road Reserves
  • Road Drainage
  • Bikeways

2. Roadside/Street Furniture

  • Bus Shelters
  • Street/Road Side Signage
  • Seats/Benches
  • Rubbish Bins

3. Street Lighting

  • Maintenance/New Lighting
  • Lighting for safety

4. Parks and Gardens

  • Maintenance
  • Drainage maintenance
  • Development of New Parks
  • Tree Planting
  • Beautification
  • Barbeques
  • Park Furniture
  • Shelters
  • Playground Equipment

5. General Drainage

6. Building Services - Advice/Control

7. Planning Services - Advice/Control

8. Environment Program

  • Environmental Monitoring/Licensing
  • Education

9. Public Order and Safety (Local Laws, Licensing, Compliance and Administration)

10. Public Health Program

  • Immunisation Clinics
  • Mosquito Control
  • Weed Control
  • Animal Control
  • Stock Pound
  • Vermin Control
  • Community Health Promotion

11. Community Facilities (Halls etc)

12. Community Services Programmes

  • Community & Major Events
  • Youth & Commnunity Development
13. Sport and Recreation Facilities

14. Libraries & Art Galleries

15. Airport

16. Public Toilets


How do Bundaberg's rates and charges compare with other major Queensland councils?

Bundaberg's rates continue to be one of the lowest of the major regional councils in Queensland, and the second lowest in regional Queensland after Gladstone. Only some of the big urban centres in South-East Queensland, such as Brisbane and Ipswich, as well as Gladstone in regional Queensland, have cheaper rates than Bundaberg. Cities like Brisbane and Ipswich have large commercial and industrial rating bases to boost their rates revenue and subsidise residential rates. It is also significant that our neighbouring councils of Fraser Coast, Rockhampton and Gympie have higher rates than Bundaberg. The comparison for 2012/13 is as follows:

Comparison of Rates and Charges between major Queensland Councils for 2012/2013

Regional Council

Minimum

General Rate

Sewerage

Waste Collection

Water Access

Separate Rates

Total

Order

Brisbane

$485

$476

$269

$167

$77

$1,474

1

Gladstone

$769

$501

$258

$317

$0

$1,845

2

Ipswich

$760

$567

$297

$339

$39

$2,002

3

Bundaberg

$814

$555

$283

$365

$0

$2,017

4

Cairns

$788

$697

$334

$233

$0

$2,052

5

Gold Coast

$767

$689

$229

$201

$173

$2,059

6

Sunshine Coast

$978

$570

$229

$232

$85

$2,094

7

Redlands

$811

$730

$318

$252

$0

$2,111

8

Moreton Bay

$740

$744

$237

$346

$52

$2,119

9

Logan

$686

$578

$254

$252

$389

$2,159

10

Townsville

$990

$701

$224

$310

$0

$2,225

11

Rockhampton

$1,100

$499

$346

$308

$432

$2,253

12

Gympie

$957

$587

$271

$343

$115

$2,273

13

Mackay

$984

$810

$250

$313

$102

$2,459

14

Fraser Coast

$1,109

$665

$316

$425

$104

$2,619

15

Average

$849

$625

$274

$294

$105

$2,117

 

How are General Rates calculated?

General Rates pay for most of what Council provides, except for the supply of Water, the treatment and disposal of Sewage, and the collection and disposal of Waste, which are separately financed. In terms of the Local Government Act 2009, General Rates must be calculated by Council based on the Government Value of each rateable property, which is the value assigned to a property by the State Government Department of Natural Resources and Mines. The amount of General Rates which a particular property is required to pay is calculated by multiplying a property's Government Valuation by a ‘Rate-in-the-dollar'. The Rate-in-the-dollar is calculated by dividing the total amount of Rates Revenue that Council requires by the total value of all rateable land.

For example, if there were only two rateable properties with values of $90,000 and $100,000, and if Council needed to collect say $2,000 in rates to provide them with general services, Council would calculate the rate-in-the-dollar by dividing the total amount it needed to collect ($2,000) by the total valuation of the properties ($190,000). So the rate-in-the-dollar in this example would be $2,000/$190,000 = 0.01053 cents in the dollar.

The amount of General Rates that each property owner would need to pay in this example would be calculated as follows:

Property Value   Rate-in-the-dollar    Rates Payable 

$100,000

x
 0.01053

=

$1,053

$90,000

x
 0.01053

=

$947

Total Income

   

=

$2,000


In simple terms a ratepayer pays 'their share' of the income needed by Council based on the proportion of their property's valuation to the total valuation of all properties.

What are Minimum General Rates and why are they necessary? 

As noted above, the Local Government Act prescribes that General Rates must be calculated by multiplying a property's Government Valuation by a rate-in-the-dollar. However the Act also provides for councils to charge all ratepayers a minimum amount which recognizes that ratepayers have an equal opportunity to enjoy the facilities and services provided by Council, which are financed from General Rates. If General Rates were only based on a property's valuation, ratepayers with relatively low property values would pay much less than those with higher valuations for the same Council services. It is generally accepted that a person's property value bears little relation to their use of Council's facilities and services, therefore the application of a minimum amount is considered to be a fairer outcome.

The effect of applying a Minimum General Rate is illustrated in the following example of two properties with valuations of $120,000 and $40,000. If General Rates were only based on Property Value multiplied by a Rate-in-the-dollar, Property ‘A' in the following example would pay three times as much General Rates as Property ‘B' for exactly the same Council services. This is obviously unfair so Council requires each ratepayer to pay a minimum amount of rates. For example, in 2012/2013 the minimum is $814 per annum for Urban residential properties. Therefore in the following example, even though the owner of the more valuable property still pays almost 50% more than the owner of the less valuable property pays when a Minimum is applied, at least the minimum makes the comparison fairer than if it would be if it was based solely on valuation.

Property

Property Value

Rate in the dollar

Rates charged

‘A'

$120,000

0.009909

$1,189

‘B'

$40,000

0.009909

$396

‘B'

$40,000

Minimum applied

$814

Currently 13,496 Bundaberg Regional Ratepayers pay a Minimum General Rate out of a total of 43,568 ratepayers,  that is 30.98%. Bundaberg Regional Council has one of the lowest Residential Minimum General Rates in Queensland; $814 in 2012/13, compared to the average Minimum of $849 that is applied by the larger Queensland councils.

How are Services Charges calculated?

Service Charges are levied by Council to recover the cost of providing a specific service, for example:

  • for supplying Water, or;
  • for the treatment and disposal of Sewerage, or;
  • for the collection and disposal of Waste.

These services are self-funding and their service charges are calculated by dividing the cost of the service by the number of ratepayers who receive the service. Ratepayers who do not receive the service pay nothing towards financing it.

Why are Service Charges payable for properties which do not receive services? 

Council's Water Access Charge and Sewerage Charge are levied to finance the capital cost of the Council's water and sewerage infrastructure, such as purification plants, reservoirs and pipes which are required to deliver water to Council's defined water supply areas and dispose of sewage from Council's defined sewerage areas. All ratepayers with properties within a water or sewerage area are required to pay a Water Access Charge and/or Sewerage Charge whether they are connected to the service or not.

The reason for this is that most ratepayers who own vacant land within a water or sewerage area and which is not currently connected to Council's infrastructure, plan to build on their property at some time in the future. The following simple example illustrates why Council charges everyone in a water or sewerage area a Water Access Charge and/or Sewerage Charge.

In this example, consider that Council has 100 ratepayers who require a water supply. Council builds a water reservoir, purification plant, and pipes to supply those 100 ratepayers with water. Then one additional ratepayer finishes building their house on their previously vacant land and requests a water supply from Council. If Council had not provided for this in their water reservoir capacity nor laid pipes to service the additional property, the ratepayer would have to wait whilst Council built a new reservoir and  would have to finance the entire cost of a Council work team laying the extra meters of pipe to extend the system to their property. That would cost all ratepayers in that situation thousands of dollars and would delay their receipt of a water supply  during which they would have to pay to have water trucked in.

If that situation arose, ratepayers would rightly consider that Council was inefficient and ineffective. That scenario would also be wasteful and inefficient from Council's perspective as it obviously doesn't cost as much to build a water reservoir to service 10,000 ratepayers as it would to build one for 1000 ratepayers and then another 1000 in a couple of years time and so on. It also makes financial and practical sense that, whilst Council's work crew is laying water pipes in an area, they lay them for the whole area, whether it be for water or sewerage services, rather than going back every time the next property at the end of the current service area requests a water or sewerage service. Therefore it benefits both Council and the ratepayer concerned if Council provides water and sewerage infrastructure to an entire area and if all the ratepayers in that area pay a portion of the cost of providing that infrastructure. That is a much lower cost than the ratepayer would have to pay if they requested water or sewerage services individually.

A ratepayer may never build on their vacant land, and may consider that they are paying for a potential service they will never benefit from. Whilst that is true, that scenario does not arise very often, as most people build on vacant land. However if a ratepayer doesn't plan to build on their property they will likely eventually sell it and a property that is capable of being connected to water and sewerage services should attract a higher market price than one that is not capable of connection, therefore the ratepayer still benefits from the provision of those services.

What affect does a revaluation of properties have on General Rates?

The Government Department of Natural Resources and Mines usually revalues all properties in the Bundaberg Region each year and Council is compelled by law to use the new valuations to calculate a ratepayer's general rates. Some ratepayers believe that because their property's valuation has increased their rates will increase by the same amount. This is not the case.  The amount of General Rates which a ratepayer pays is calculated by multiplying their property's Government Valuation by a ‘Rate-in-the-dollar'. The Rate-in-the-dollar is calculated by dividing the total amount of money that Council needs to collect in rates by the total value of all rateable land as illustrated in the example below. For example, if Council needed to collect $4,000 in rates to provide three properties with general services, Council would calculate the rate-in-the-dollar by dividing the total amount it needed to collect ($4,000) by the total value of the properties ($301,000). So the rate-in-the-dollar in this example would be $4,000/$301,000 = 0.013289 cents in the dollar.

In this example, the Department of Natural Resources and Mines revalued Property ‘A' from $80,000 to $84,000, Property ‘B' from $101,000 to $120,000, and Property ‘C' from $120,000 to $132,000. Council still needs to collect a total of General Rates of $4,000 from them. Therefore Council would calculate the new rate-in-the-dollar after the revaluation by dividing the income needed ($4,000) by the new total valuation of $336,000 which would give a new rate-in-the-dollar of 0.011905 ($4,000/$336,000). The important thing is the ‘average' percentage valuation increase, which in this example is 12% ($336,000 - $301,000)/$301,000.

This example illustrates that ratepayers pay rates in proportion to their property's valuation compared to the average valuation for their rating category. Therefore ratepayers in a rating category who have experienced a higher-than-average valuation increase may experience an increase in rates and those who have experienced a lower-than-average valuation increase may experience a decrease in rates. In the following example, Property A's valuation increased by 5% (less than average) and so its rates decreased from $1,063 to $1,000. Property B's valuation increased by 19% (more than average) and so its rates increased from $1,342 to $1,429. A general revaluation provides Council with no more or less total revenue, it just redistributes the total rates between existing ratepayers depending on the relationship between their property's valuation and the average valuation of all properties in their rating category.

What affect will the continued amalgamation of General Rating categories have on rates?

After the amalgamation of Bundaberg City and Burnett, Isis and Kolan Shires in 2008 to form the Bundaberg Regional Council, the Queensland Government required all amalgamated Councils to combine the rating categories of the former councils over a four year period from 1 July 2008 to 30 June 2012. However Bundaberg Regional Council requested, and the Government agreed, that General Rating Categories 6, 13 and 21 could be amalgamated over seven years due to the significant rates increases involved. This means that most rating categories have already been amalgamated and will receive the 'normal' increase in General Rates each year, but General Rating Categories 6, 13 and 21  will also receive an additional increase as a result of the necessity to amalgamate them with General Rating Categories 5, 14 and 2 respectively as illustrated below: