Rating Review - Rebalancing our Rating System

Thanks for asking for clarification - we appreciate the opportunity to clear up any mixed messaging. Here's the extracts directly from the Rating Review Report:

Council is proposing to increase the Differential for Vacant Land from 135% to 200% compared to the Rate in the Dollar (RID) for Residential properties.

Reasons for Increasing the Differential for Vacant Land

There is concern within the community about the availability of housing, including long-term rental housing. This is a concern in many councils. One strategy is to increase Vacant Land rates to discourage Land Banking and encourage owners to either build on their properties or sell them to others for development. Council’s infrastructure still has to be built and maintained regardless of whether properties have housing or are vacant.

Council is proposing to increase the Differential for Commercial Other properties from 100% to 135% compared to the RID for Residential properties.

Reasons for Increasing the Differential for Commercial Other and Industry Other properties.

Larger businesses are rated as Commercial Other and Industry Other. Ratepayers owning these types of properties potentially have a higher capacity to pay rates than typical local Residential property ratepayers.

Many councils are exploring ways to apply higher rates to short-term rental properties listed on platforms such as Airbnb and Stayz. The aim is to incentivise property owners to offer long-term rentals, helping alleviate housing shortages.

In South Australia, councils are awaiting further guidance from the State Government following the SA Parliament Select Committee inquiry into short-stay accommodation. Currently, most short-term rental properties are classified as Residential, meaning they pay the same rate in the dollar as long-term residential properties.

A proposed approach would reclassify short-term rentals under the land use category Commercial Other rather than Residential. This change would allow councils to apply a higher differential rate to these properties. At present, the differential for Commercial Other and Industry Other properties is set at 100%, the same as Residential. The council is proposing to increase this differential to 135%, enabling higher rates for short-term rentals in the future.

Thank you for raising this - it’s a good question that highlights some of the differences that can occur with the proposed approach. Examples like these are intended to support discussion about potential impacts and the trade-offs involved. Here's the detail from the Finance Team:

It’s a reasonable thing to query - thanks for picking it up. We passed this question to the Finance Team so we can provide a clear and accurate explanation of how the proposed model works - here's what they had to say:

Thanks for your question about waste services for rural properties. At the moment, kerbside green-waste bins are only available in township areas and rural properties do not receive a green bin service. We understand this can feel inequitable, especially if it appears everyone is paying the same but receiving different services.

As part of the Rating Review, Council is considering a separate Waste Charge. The Waste Charge is designed to clearly show the real cost of collecting and treating waste. Currently, these costs (around $1.2 million per year) are included within general rates. Moving this cost out of general rates and making it a separate charge would:

• increase transparency
• reduce the “Rate in the Dollar” for general rates
• show clearly who pays for waste and who receives a waste service

Under the legislation, a Waste Charge can apply to both rateable and non-rateable land. That means non-rateable properties – which don’t currently contribute to waste costs – would start contributing if they receive a waste service. The Waste Charge would not apply to vacant land unless a waste service is provided.

For rural properties, distance from a collection point (property entrance or bin bank) makes a difference. Legislation provides that:

• within 500m – charged in full
• 500m and <2km – charged at 75%
• 2km and <5km – charged at 50%
• 5km from collection point – no charge

Introducing a Waste Charge does not automatically expand green-bin services to rural areas, but it does highlight service differences and helps Council understand whether current arrangements remain fair. Your feedback brings feedback about green-waste access to the conversation, thank you.

We know the consultation paper includes a lot of information, so here’s a summarised explanation of what is happening and what you can expect.

1. What exactly is being proposed?

Right now, Council is not proposing to increase the total amount of rates collected. The amount of rates required is a separate process that happens each year when Council considers its Long-Term Financial Plan, develops its Annual Business Plan & Budget and consults with the community.

On this occasion, Council is reviewing how the current rates are shared across different types of properties to make sure the system is fair.

Phase 1 of this community engagement program explains the structure of rating being considered – things like a fixed charge, adjusting differentials for certain land uses and introducing a Waste Charge.

Phase 1 is the first step. The detailed, property-by-property examples you’re asking for – such as what a $400K home or a $2M farm would pay – will be included in Phase 2 of the community engagement program.

Phase 2 will explain:

• the current rate for different property types
• the proposed rate under the new structure
• how this changes in dollars and in percentage terms
• the effect of the Fixed Charge
• the effect of the Waste Charge

You will be able to see how the proposal affects several example properties in each rating category (Residential, Primary Production, Vacant Land, Commercial etc).

Rate revenue is set by Council each year as the last step in preparing the budget.
 The ‘rate in the dollar’ is calculated by taking the total Rates Revenue Council identifies as necessary to raise and dividing it by the total Capital Value of the properties in our district.

If property values go up, Council does not automatically receive more money.

Property values are determined by the Valuer General. 

• If the total property values for the district rise, the rate in the dollar falls.
• If values fall, the rate in the dollar rises. 

This is how all councils in South Australia operate under the Local Government Act 1999.

2. What if the economy gets worse?

Council plans ahead for economic changes. We do this through our 10-year Long-Term Financial Plan, which includes:

• economic scenario planning
• managing revenue risks
• careful borrowing
• maintaining essential services
• controlling costs
• building financial resilience over time

3. What is Council’s debt situation?

As at the end of October 2025, Council reported a total debt figure of $13.8M. The full details of the loan balances are published every month in the monthly Finance Report as well as annually in the Annual Report through the audited Financial Statements.

In the recently revised 2025-26 budget (Budget Review 1), finance costs (interest on loans) was forecast at $662K. This equates to 4.18% of Total Rates Revenue, or 3.4% of Total Revenue (as Council receives income from other sources than just rates).

Great question and we appreciate you digging into the reasoning behind the Fixed Charge vs Minimum Rate. Here's what our Financial Sustainability Team have to say:

Under the Local Government Act 1999, Council does not directly choose the Rate in the Dollar (RID). The RID is simply the mathematical result of:

Total general rate revenue required ÷ Total capital value of all rateable properties.

Because of this, Council cannot reduce the RID by ‘choosing a lower rate’; the only way to reduce the RID is to reduce the amount of revenue that must be raised through the RID calculation.

A Fixed Charge is one of the tools that allows Council to do this. When a Fixed Charge is applied:

1. A fixed amount is collected evenly from all rateable properties.

2. This reduces the amount of revenue that must be raised through the RID calculation.

3. As a result, the RID is lower than it otherwise would be.

This is why a Fixed Charge can have the effect of reducing rates for higher-valued properties (such as many Primary Production properties), compared with the current Minimum Rate system.

Our Financial Sustainability Team have provided some more information:

Community-title and Torrens-title homes are charged the same rates because the Local Government Act 1999 requires councils to calculate general rates based on the value of the property (Capital Value as provided by the Valuer General), not the type of land title or the private infrastructure that owners pay for themselves. This means Council is not legally able to set different rates for community-title properties unless the State Government changes the legislation.

Council understand that community-title owners often contribute to internal roads, lighting, shared gardens and other infrastructure within their schemes. However, many properties across the district - such as rural homes, farms and private estates - also maintain internal roads, driveways, stormwater systems, pumps or shared assets at their own cost. Under the Act, these privately funded services cannot be used to reduce Council rates, because general rates must remain based on land value.

All residential properties - whether Community title or Torrens title - still receive and benefit from district-wide Council services, including:

• access to the public road network
• waste and recycling services
• libraries and community facilities
• parks and open space
• development assessment
• environmental management; and
• many other core services provided by Council

Because Community-title properties also rely on and benefit from these whole-of-community services, they must remain in the Residential rating category under current SA law.

Thanks for following up, sometimes questions don’t appear straight away due to moderation, so we appreciate you asking again.

To help with your query, the detailed proposal - Review of the Basis of Rating Consultation Paper – Part A, prepared by UHY Haines Norton - is available to read and download here on the project site. 

Here's some more information Financial Sustainability Team:

When Council talks about ‘rebalancing the distribution of rates’, Council means it is looking at how the total rates bill is shared across different types of properties, not increasing the amount Council collects overall.

Over time, some groups of properties have ended up paying more or less than what seems fair when we compare ourselves to other councils. This review is about checking whether the current system is still fair for everyone.

What does “capacity to pay” mean in this review?

Council is not looking at anyone’s personal income or bank balance. Instead, it looks at broader indicators to understand what different groups of ratepayers can reasonably contribute.

This includes things like:

• Property values – Rates in SA are based on the capital value of your property as valued by the Valuer General. Higher-value properties generally have a greater capacity to pay.
• Socio-economic data – ABS data shows which parts of the District have higher levels of financial stress and which are more advantaged.
• Where owners live – Over half of the properties in our district are owned by people who don’t live here and many live in higher-income suburbs. That tells us something about capacity to pay across the district.
• Property type – Commercial, industrial, vacant land and primary production properties all have different economic profiles.

Council uses this information to understand the bigger picture – not to judge any individual household.

So what actually changes?

The proposals currently out for the community to consider aim to make the system fairer by:

• moving from a Minimum Rate to a smaller Fixed Charge,
• adjusting differentials for certain property types; and
• introducing a Waste Charge so waste costs are shared more directly amongst those are provided the service    .

These changes don’t raise extra money for Council – they simply look at whether the current mix is fair and how it could be improved.

What’s next?

Phase 2 of the community engagement program will provide detailed modelling showing how the proposals would affect different types of ratepayers. All feedback will be carefully considered before any decisions are made.

Importantly, there are already measures in place under South Australian legislation and Council policy to support people experiencing financial difficulty, and these will continue to be available regardless of any rating changes.

1. Seniors can postpone part of their rates

South Australian legislation allows eligible seniors to postpone all rates above $500 on their principal place of residence. The postponed amount does not need to be repaid until the property is sold. Interest applies, but this option can significantly reduce the amount a senior needs to pay each year.

2. Council offers payment plans

Any ratepayer who is struggling can request a payment arrangement, allowing rates to be spread over smaller, more manageable instalments.

3. Financial hardship assistance is available

For pensioners or other residents experiencing genuine financial hardship, additional support may be available following a recommendation by a qualified financial counsellor (a free service).

4. Cost of Living Concession

Additionally, Councils used to provider a Pensioner Concession that was funded by the State Government. In 2014–15, the State Government ended its funding to councils for this concession. Instead, eligible households now receive a Cost of Living Concession directly from the State Government.