How Rates Are Calculated (including penalties)

Overview

Rates are a tax on property and form the major component of funding available for local authorities to finance their activities.  Rates are assessed on properties within the provisions of the Local Government (Rating) Act 2002.

Horowhenua District Council sets two sorts of rates: targeted rates, which fund specific activities, and general rates, which fund everything else.

General Rates

General rates are the largest single source of funding for expenditure.  They are used to fund both operating and capital expenditure for all activities other than solid waste, water and wastewater, including:

  • Regulatory services (planning, health and safety licensing, building consents)
  • Parks and recreation (reserves and beautification, sports fields, cemeteries)
  • Roading (roads, streets and bridges, footpaths, stormwater drainage)
  • Libraries
  • Community support (emergency management, marketing, community development, Safer Community Councils, grants, economic development)
  • Property (motor camps, halls, forestry, general)

General rates are assessed to fund all activities not funded from targeted rates.  This is set to reflect the proportion to the relative benefits generated by Council's expenditure. 

General rates are based on land value. Land values are assessed every three years, and were last assessed in 2013, forming the basis of rating from 1st July 2014.

Targeted Rates

Targeted rates are set to cover, in a transparent manner, the operating and capital expenditure of seven major activities that have significant rating requirements and relatively high degrees of private benefit:

  • solid waste management
  • water supply
  • wastewater disposal
  • roading and stormwater
  • library services
  • representation and governance
  • swimming pools.

Solid Waste Rate

The solid waste rate is a fixed-sum rate assessed on the number of separately used or inhabited parts of each property in the district.

Water Rates

The water rates are fixed-sum rates assessed on the number of separately used or inhabited parts of each property in the five scheme areas (Levin, Shannon, Foxton, Foxton Beach and Tokomaru). In Foxton, there is also a rate on land value to meet loan-servicing costs.

Water rates based on metered consumption are also assessed on all properties in Foxton Beach, and on large users elsewhere.

Wastewater Rates

The wastewater rates are fixed-sum rates assessed on the number of separately used or inhabited parts of each property in the six scheme areas (Levin, Waitarere Beach, Shannon, Foxton, Foxton Beach and Tokomaru). In Levin, Foxton and Tokomaru there are also rates on land value to meet loan-servicing costs.

Penalties on Unpaid Rates

The due dates listed above under 'Instalment Dates' are the last dates on which payment can be made without the imposition of a penalty. A first penalty of 10% shall be added to the any part of an instalment that remains unpaid at due date.

A second penalty of 10% will be added to any and all rates and penalties remaining unpaid as at the following 1 July.

Further penalties of 10% will be added to any rates and penalties for previous years remaining unpaid as at the following 1 January and 1 July.

(Penalties are not charged on water rates invoiced by way of quarterly accounts for metered water consumption.)