GLOUCESTER Shire’s net operating result stands to slide more than $3 million into the red in 2014 unless an application for a special rates variation is successful.
Council is considering a submission to the Independent Pricing and Regulatory Tribunal (IPART) that would see rates more than double in the next seven years to offset the slide.
Financial projections released by the council last week predict a $3.2 million operating deficit in 2014, growing to $3.25 million in 2015 and $3.33 million in 2016.
Council ran at an operating loss of $40,000 in the 2012-13 financial year.
“The figures don’t include a special rates variation,” finance manager Susie Jones said.
“If we don’t get any particular grants, this is where we are headed.”
Council’s income for the 2012-13 financial year was $16.474 million, with expenses coming in at $16.514 million.
Council received $3.49 million in rates income, and $4.854 million in total rates and annual charges, but spent $6.16 million on employee expenses.
General manager Danny Green said an application for a special rates variation was in the pipeline.
He said council was considering applying for a 10.5 per cent rates increase above the CPI (Consumer Price Index) - roughly seven per cent per annum above the pegged rate - over the next five years.
“At the end of that period we would be looking at a doubling of rates,” he said.
Mr Green said council was still finalising its plans and would not commit to an actual figure until later in the year.
“If I table that today, the community will think council has made its mind up,” Mr Green told councillors at their monthly meeting last week.
Such an increase would allow council to maintain its assets to the “best affordable level”, Mr Green said.
He said if Gloucester residents wanted assets to be maintained at the highest possible level it would mean a tripling of rates.