By Cam Lucadou-Wells
Greater Dandenong residents will be spared the full 3.5 per cent rate rise as the council pulls the “financial reins” in its draft 2023-’24 budget.
Despite economic headwinds and soaring costs, Greater Dandenong Council will charge residents a 1.85 per cent median increase in rates.
Including the waste charge, the median household rates bill will rise from $1459 to $1504 – up $45 or 3.11 per cent.
Overall, the 3.5 per cent rates cap set by the State Government has been applied as an average across all property types.
Farm, industrial and commercial ratepayers will bear the greatest increases of 19.2 per cent, 4.96 per cent and 3.54 per cent respectively.
Mayor Eden Foster said the budget was balancing the protection of ratepayers “feeling the financial strain” with providing long-sought community projects.
She said some projects would be delayed because of the challenging financial environment afflicting “all levels of government”.
“We have to pull the financial reins a bit.”
According to budget papers, Greater Dandenong is set to borrow extensively to fund three major projects – the $22m Keysborough South Community Hub, the $98m Dandenong Wellness Centre (the new Oasis) and the $30m Dandenong Community Hub.
They will be funded by nearly $75 million in loans and $34 million from reserves over the next four years.
A council budget report declared the projects as important for community wellbeing, as well as stimulating local employment, businesses and suppliers.
Greater Dandenong’s proposed $58.3 million capital works program is dominated by big infrastructure, including:
– $11 million for Keysborough South Community Hub
– $5.5 million towards the $98 million Dandenong Wellness Centre
– $3 million for Dandenong New Art gallery
– $1.76 million for detailed design of the Dandenong Community Hub.
Roads, footpaths and drainage infrastructure, however, get a major cut in 2023-’24.
This is despite the need to replace 1960s and 1970s infrastructure “beginning to become urgent”.
Greater Dandenong Council expects its debts will reach a height of $104 million in 2027 but remain “within prudential limits”, according to a budget report.
As of June 2022, the council was the second most indebted of Eastern Metropolitan Melbourne, owing about $60 million.
Borrowing costs will also be hit by rising interest rates. About $7.2 million a year is expected to be diverted from capital works to service debt and interest.
Cr Foster noted that interest rates were rising from a “very low” base, and weren’t anywhere near the 17 per cent rate three decades ago.
“We don’t want to stop altogether. There are certain things that the community needs.
“We have significant ageing infrastructure and a need for new community facilities.
“The Dandenong Oasis is so old and it’s costing us so much to run per year. It needs to be replaced.
“With Keysborough South Community Hub, that’s something the community has been waiting for quite some time.
“And again with Dandenong Community Hub, they’ve been waiting a long time for it and that’s in the city’s centre.”
Projecting a $29 million 2023-’24 surplus, the council states that financial stability and sustainability is “one of the highest and most pressing” of its challenges.
It faces increased energy and construction costs, rising wages and widespread skills shortages, as well as being “hurt” by rate capping.
“A devastating pandemic has had an enormous financial impact and a lasting one,” its budget papers state.
“This remains a risk but has been in effect superseded by the cost of living and inflationary pressures which will challenge Council’s financial position and longer-term financial sustainability.
“The key challenge over the next decade will be keeping rates affordable by meeting the rate cap as pressure on other revenue sources combine with key service and construction costs growing quicker than the rate cap.
“Council has the same dilemma as most individuals – it has a limited budget yet many and competing demands on where to allocate its scarce resources.”
Keysborough households will continue to pay the $350 Keysborough Maintenance Levy.
The proposed budget is on public exhibition from 26 April-24 May.
