Over the past decade, Tenterfield Shire Council has maintained high levels of service; maintaining roads, re-building bridges, running libraries, parks and gardens. However, in the past four years, prolonged drought, bushfires, COVID-19 and floods have all impacted Council’s finances. At the same time, cost-shifting from the State government and significant reduction of the Financial Assistant Grants (FAGs) by the Federal government have had a significant impact on our bottom line.
While service levels have been maintained, Council’s income has remained fairly static while input costs have soared with significant cost increases attributed to renewal and maintenance of assets. Council has also seen a significant cost increase in legislative compliance, (e.g. audit and risk, grant applications, reporting and acquittal) insurance and workers compensation. As Council operating expenses are exceeding our operating revenue a deficit shortfall is generated which accumulates each year impacting Council service delivery to the community.
Council acknowledges that its cash reserve’s within the General Fund is of high concern and despite implementing effective short-term strategies to cut costs, including a freeze on staff hiring, Council’s financial position is unsustainable without rate rises.
The proposed rate rise is critical because the gap between what we receive in rates into the General Fund and what we need to spend maintaining and upgrading Council owned assets (Shire buildings, 695km of sealed and 1043km of unsealed roads and bridges etc.) is currently $4.5m per year.
Like most businesses, the impacts of the past three years have forced Council to stop and reset. With a new Council in place, we need to look at how we do business, where we can improve our revenues, create efficiencies, find savings and how we can ensure financial sustainability for the residents of Tenterfield Shire well into the future.
It should be noted that Council has separate funds for waste, water and sewerage. These funds are self sustaining and include asset management, maintenance and renewal costs. These funds cannot be used for any other purpose.