How rates work
Local councils carry out a range of activities for their communities. These include maintaining our water supply and roads and providing community facilities such as libraries and museums. Council activities are mainly funded through rates.
Other sources of funding include grants, user fees, investment income and development contributions.
The following information explains how rates are calculated in Whanganui, how property valuations affect rates and how rates are allocated to individual properties.
More detailed information can be found in the Council's Long-Term Plan and Annual Plan.
How our rates compare
Rates cannot be directly tallied against other centres as many variables influence rates, such as population, geography, assets to maintain, levels of investment in infrastructure and services provided.
Whanganui District Council does not collect information on how we compare to other councils but each year the Taxpayers’ Union undertakes a survey to compare rates between councils.
According to this survey our rating level is comparable to regions of a similar size. For the 2019/2020 year, Whanganui’s average rates per household were $2,645. This is lower than our Manawatū neighbours – who sit at $3,088 – but higher than South Taranaki – at $2,231 – and effectively the same as Palmerston North at $2,634.
The survey shows that nationally Whanganui sits mid-range. The national average for the 2019/2020 year was $2,446.
How rates are set
The amount of rates the Council collects each year is determined through the Long-Term Plan and the Annual Plan process.
These plans establish the Council’s work programme for a range of activities, such as roading or stormwater. The cost of delivering and funding each programme is calculated, and the amount of rates that needs be collected is then worked out. The Council consults with the community before adopting these plans.
How your rates are calculated
Once the Council calculates the total amount it needs to collect from rates to fund its activities, rates are charged to individual properties. Rates are usually based on either the property’s land value, capital value or a fixed charge applied to each separately used or inhabited part of a rating unit (SUIP).
The Property Rates Search provides a draft calculation of the 2019/2020 rates. Rates for 2019/2020 were finalised in July 2019 after the 2019-20 Annual Plan was adopted by the Council.
What is a SUIP (separately used or inhabited part of a rating unit)?
In most cases one household or business is based at a property and the property is classified as one SUIP. However, some properties have several users, and these properties are called 'multiple SUIPs'. An example of a multiple SUIP would be a house with a 'granny flat', or a property where several businesses operate.
For a legal definition of a SUIP refer to the Council’s Funding Impact Statement contained in the latest Long-Term Plan or Annual Plan.
Differential rating system
Under Whanganui's differential rating system, properties are categorised as either residential, commercial or farming. Rates vary for each category of property, based on the perceived level of service and benefit that category of property receives.
Types of rates
Whanganui's rates can be broken down into three main types - uniform annual general charge, general rate and targeted rates.
Uniform annual general charge (UAGC)
A uniform annual general charge is a fixed charge for each SUIP of a property, regardless of the value of the property. It’s used to pay for general Council services.
The purpose of a uniform annual general charge is to make sure all property owners or ratepayers make a minimum contribution to services that benefit Whanganui.
As a rule, if a service benefits the entire community it will be funded from general rates. General rates are calculated by looking at the land value of a property.
Both the uniform annual general charge and the general rate are used to fund services such as:
- libraries, museums and galleries
- animal management
- parks and recreation
- port and river.
If a service benefits only a specific group of ratepayers, it will be funded from a targeted rate. For example, only those connected to the Council’s wastewater system are charged rates for maintaining the wastewater system.
The targeted rates apply to:
- water supply
- stormwater drainage
- waterways and natural drainage
- earthquake strengthening
- Central Business District services.
How property values affect rates
When a property’s value changes this can affect the share of total rates the property pays, as some of our rates are based on a property’s land or capital value.
- if your property value increases by about the average amount, you’ll have an average rates increase
- if your property value increases more than the average, you’ll have a greater-than-average rates increase
- if your property value increases by less than the average, you’ll have a lower-than-average rates increase.
Regional Council rates
Horizons Regional Council rates are billed and paid for separately and are not connected to Whanganui District Council rates. You can call Horizons’ Rates Department on 0508 800 800.