Coronavirus has had a significant impact on Queenstown’s tourism economy, affecting everyone from seasonal workers to homeowners. As a result, many are facing severe financial challenges.
Queenstown Lakes District Council (QLDC) has provided a range of programmes to help ease pressure on people across the district.
These include rent relief, broader options for rates payment instalments and Emergency Operations Centre welfare programmes. All are still available for residents who fit the relevant criteria.
As well as these, a comprehensive review of the 2020-2021 Annual Plan will look to limit rates increases to a minimum. Council fully acknowledges that the budgets supporting the draft Annual Plan, adopted on March 12, need to be substantially reviewed in light of the deteriorating economic conditions resulting from the coronavirus pandemic.
To this end, the council announced on April 8 that it intended to proactively review alternative budget scenarios for the 2020-2021 Annual Plan (AP21). In particular, the council stated it would be looking to limit rates increases to a minimum. The consultation document approved on March 12 signalled an average rates increase of 6.76 per cent. Council is now targeting a revised budget which reduces the average rates increase down closer to the current rate of inflation, which is 1.8 per cent.
Limiting the rates increase to this degree will not be an easy task. A significant budget issue for QLDC is that it has substantial tourism-related revenue budgets which are now at risk. These include the Queenstown Airport Corporation dividend and turnover-based concessions, as well as tourism-related rental income from sources such as campgrounds and wharves. Much of this tourism-related revenue reduces rates.
The revised budget has seen all these revenue forecasts reduce significantly, which means QLDC had to find significant additional savings and funding. The revised budget will be discussed by councillors next week as part of its consideration of Annual Plan submissions.
Visitor accommodation has been particularly affected by coronavirus. With far fewer tourists visiting the region, many houses that were used for visitor accommodation have now become long-term rentals or remain unrented.
This has had an impact on the rates owners of these properties need to pay. Owners can now apply for visitor accommodation rates relief if they own a property in this category and do not intend to use it for visitor accommodation for the next 12 months, or if they hold a 365-day visitor accommodation consent and are significantly reducing the amount of visitor accommodation use to fewer than 180 days per year.
Visitor accommodation rates relief will readjust rates for the rating year commencing on July 1 2020. Rates will revert to pre-coronavirus visitor accommodation rates in July 2021 unless the council is contacted before June 30 2021.
Owners will be required to make a declaration that they are aware of obligations to pay rates and that the property will be used in the manner specified on the application form for the next 12 months.
There is no requirement to adjust resource consents to be eligible for the rates relief.
Read edition 976 of the Wānaka Sun here.