Council tips $500k budget deficit
RICHMOND Valley Council is expecting its 2010/11 budget to be $500,000 in the red.
The council’s grim financial situation was revealed at an extraordinary council meeting yesterday, called to endorse the draft management and budget plans for the year.
“We are approaching a dire situation,” Cr Charlie Cox said.
“The Richmond Valley Council will be financially insolvent within three to five years.
“Houston, we have a problem.”
Cr Cox said that in the past councillors had asked staff to guide them to find long-term financial solutions.
“We can’t keep asking for staff to come up with ideas,” he said.
“It’s time for the hard yards. It’s not time to throw it over to someone else and ask them to carry it for us.”
Cr Robert Mustow pointed to the rejection of a three-year-old proposal to introduce five years of rolling rate increases, knocked back by the Department of Local Government and the community, as a contributing factor to the current financial crisis.
Finance manager James Brickley confirmed that had the rises been granted the council would not be in the financial situation it finds itself. The rate yield for 2010/11 would have been $1 million more than its current yield.
The councillors agreed it was time to find ways to increase revenue and cut back on council spending, although no tough decisions were taken at yesterday’s meeting.
Total general rate revenue for the next financial year is estimated to be $7.7 million.
This includes the allowed rate peg increase of 2.6 per cent, and is about 18.5pc of the council’s proposed operating revenue.