TAMWORTH council has been forced to choose between the bad and the worst, with a plan on the table to up rates by more than 30 per cent across the next two years.
A report, which is set to go before councillors on Tuesday, has recommended council starts preparing an application to increase rates by 36.3 per cent across the next two years, or head towards a "very bad financial state", according to mayor Russell Webb.
Cr Webb said the council had explored all other options, including selling off assets, saving money, and cutting down on staff, before considering the looming rate rise.
"There's so many things we've been doing to try and save money," Cr Webb said.
"But we've reached the end of our tether."
If the council votes in favour of the recommendation, a six-week community consultation period will be held before a final application for the permanent 'Special Rate Variation' is lodged with the independent pricing watchdog, IPART.
If the rate rise is approved, council is proposing to up rates by 18.5 per cent for the 2024-25 financial year, and 15 per cent for the 2025-26 financial year.
Both increases include the yearly rate peg set by IPART.
On average, this would see residential rates increase by $221.50 in the next financial year, and $212.82 the year after.
Businesses would be forced to pay an extra $768.49 in the 2024-25 financial year, and $738.38 the following year.
Not applying for a SRV, or copping a one-off 30 per cent rate rise next financial year have also been mapped out as alternatives.
"The only thing we can do to increase our revenue is to probably consider putting up our rates through a SRV," Cr Webb said.
He said if the community takes a firm stance against the proposed rise, and the council does nothing, the city will face a loss of $10 million per year.
"If we don't do this now, and we put it off, we're going to be in a very bad financial state," Cr Webb said.
"We can't wait any longer."
And if rates go up, improving the road network and traffic upgrades, re-investing in ageing aquatic facilities, delivering sports and recreation projects, a new multi-million dollar aquatic centre, and a brand new animal pound will be added to the to do list.
Cr Webb confirmed the potential budget deficit the organisation could face if they don't act is not a result of biting off more than they can chew.
"We definitely haven't promised too many things we can't fund," he said.
But council's draft 'Long Term Financial Plan' for the next 10 years reveals some projects have been put on an indefinite hold.
"Given the current increasing costs of living, council has made the decision to focus on seeking only the sufficient revenue needed to renew current assets and remaining financially sustainable," the document says.
"Council is still looking at completing its studies on the best options to procure and fund the above projects, with the least financial impact on the wider community."
Cr Webb said what is to blame for the looming cash shortfall, is council's rising costs, inflation, the impacts of the pandemic, and severe wet weather.
He said Tamworth's council is not alone in feeling the pinch for more funds, but what they are asking for is significantly less than other councils around the state.
"There is not a council that has said anything other than 'we're in trouble'," he said.
If the recommendation is given the green light on Tuesday, a series of information sessions will be planned to hear what the community has to say.
"If you come to those information sessions, you'll get a bit of an insight into what we're looking at, and what we've got to do in the future to maintain ourselves."
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