Tough budget for disaster-ridden council
IT HAS been a tough year for Richmond Valley Council, with the community facing devastating bushfires, drought, flooding and the ongoing effects of Covid-19.
The draft budget has revealed these natural disasters, as well as increases to the Emergency Services Levy, will create tough times for the council's coffers.
According to the May meeting agenda, the general manager's report includes the proposed 2020/21 Draft Operational Plan (including Draft Financial Estimates 2020/24).
The report, which was compiled by the council's principal accountant, shows the council's projected operating result before capital grants and contributions for 2020/2021 will have a deficit of $4,589,990.
But, this is set to slightly improve with the draft budget estimating a deficit of $1,897,558 over the four year forward financial estimate to 2024.
The report said the 2019 approval of the council's special rate variation has "given council the ability to focus on moving towards a break-even operating result before capital grants and contributions in the medium term".
"Finding ways of achieving additional income, reducing operating expenditure and refining asset valuation methodologies, to accurately reflect depreciation of the council's assets remain key areas to focus on moving forward," the report says.
The report warns the council will also need to find strategies for funding the ongoing increases in the Emergency Services Levy, which the report said is a "major concern".
While the draft budget projects an unrestricted cash surplus of $290,384 in 2020/2021, the four year forward financial estimate reveals the council could face deficits in the next three financial years due to further increases of the levy.
The draft budget reveals the levy has increased by $451,665 or 39 per cent for 2020/2021 financial year, with one-off funding relief being provided through the Office of Local Government's Covid-19 economic stimulus package.
A further increase of approximately 27 per cent is estimated for the 2021/2022 year and has been factored in to the 2020/24 financial estimate.
However there is positive news within the proposed budget, which includes a capital works program of $31,883,597 for 2020/2021 including a number of key projects.
"Council is delivering on its capital works program and continuing to rebuild the bushfire, drought and flood affected areas of the Richmond Valley," the report says.
Richmond Valley councillors are set to vote on the Draft Operational Plan at tonight's meeting, which if successful, will go onto public exhibition.