Agenda of Extraordinary Council

ETHICAL DECISION MAKING AND CONFLICTS OF INTEREST

A GUIDING CHECKLIST FOR COUNCILLORS, OFFICERS AND COMMUNITY COMMITTEES

Ethical decision making

Is the decision or conduct legal?

Is it consistent with Government policy, Council’s objectives and Code of Conduct?

What will the outcome be for you, your colleagues, the Council, anyone else?

Does it raise a conflict of interest?

Do you stand to gain personally at public expense?

Can the decision be justified in terms of public interest?

Would it withstand public scrutiny?

Conflict of interest

A conflict of interest is a clash between private interest and public duty. There are two types of conflict:

Pecuniary – regulated by the Local Government Act and Department of Local Government

Non-pecuniary – regulated by Codes of Conduct and policy. ICAC, Ombudsman, Department of Local Government (advice only). If declaring a Non-Pecuniary Conflict of Interest, Councillors can choose to either disclose and vote, disclose and not vote or leave the Chamber.

The test for conflict of interest

Is it likely I could be influenced by personal interest in carrying out my public duty?

Would a fair and reasonable person believe I could be so influenced?

Conflict of interest is closely tied to the layperson’s definition of ‘corruption’ – using public office for private gain.

Important to consider public perceptions of whether you have a conflict of interest.

Identifying problems

1st Do I have private interests affected by a matter I am officially involved in?

2nd Is my official role one of influence or perceived influence over the matter?

3rd Do my private interests conflict with my official role?

Whilst seeking advice is generally useful, the ultimate decision rests with the person concerned.

Agency advice

Officers of the following agencies are available during office hours to discuss the obligations placed on Councillors, officers and community committee members by various pieces of legislation, regulation and codes.

Contact	Phone	Email	Website
Bega Valley Shire Council	(02) 6499 2222	council@begavalley.nsw.gov.au	www.begavalley.nsw.gov.au
ICAC	8281 5999 Toll Free 1800 463 909	icac@icac.nsw.gov.au	www.icac.nsw.gov.au
Division of Local Government (DPC)	(02) 4428 4100	dlg@dlg.nsw.gov.au	www.dlg.nsw.gov.au
NSW Ombudsman	(02) 8286 1000 Toll Free 1800 451 524	nswombo@ombo.nsw.gov.au	www.ombo.nsw.gov.au

TO: The General Manager
Bega Valley Shire Council

Disclosure of pecuniary interests / non-pecuniary conflict of interests

In accordance with the Council’s Code of Meeting Practice and the requirements of the Local Government Act and regulations or dispensation issued by the Division of Local Government I hereby disclose the following pecuniary interests and/or non-pecuniary conflict of interests at the meeting as indicated below:

Ordinary meeting held on _____ / _____ / 20___

dd mm yy

	Item no & subject
	Interest (tick one)	Pecuniary interest Non-pecuniary conflict of interest
	* Nature of interest
	If Non-pecuniary (tick one)	Disclose & vote Disclose & not vote Leave chamber

	Item no & subject
	Interest (tick one)	Pecuniary interest Non-pecuniary conflict of interest
	* Nature of interest
	If Non-pecuniary (tick one)	Disclose & vote Disclose & not vote Leave chamber

Signed
Print Name	Councillor

* Note: Under the provisions of Section 451(1) of the Local Government Act 1993 (pecuniary interests) and Part 6.11 of the Model Code of Conduct prescribed by the Local Government (Discipline) Regulation 2004 (conflict of interests) it is necessary for you to disclose the nature of the interest when making a disclosure of a pecuniary interest or a non-pecuniary conflict of interest at a meeting.

Extraordinary Council 7 March 2013 Item 3.1

3.1. Special Variation application consideration

Council is required to formally resolve if it will lodge the proposed Special Variation to General Rates income through a s508A application to IPART.

Group Manager Community & Relationships

Background

At its meeting on 12 December Council resolved:

1. That Council notify the Independent Pricing and Regulatory Tribunal in relation to a s508A special variation application for the period of three years from 2013/14.

2. That should Council proceed in due course with a special rate variation application, the second part of that variation concerning the renewal of the sports and recreation levy be referred to as “assets being for renewal and upgrade”.

In line with this resolution Council formally advised IPART that a section 508A (multiyear application) was being finalised and further consultation with the community was commenced.

Focus group consultation commenced in January 2013 following surveys conducted in December 2012.

At its meeting on 6 February Council resolved:

1. That the draft 2013/14 operational plan and budget be placed on public exhibition from 7 February 2013 with feedback on Council’s proposed special rate variation to be considered at an Extraordinary meeting on 7 March 2013.

2. That the draft 2013/14 fees and charges be further considered by Councillors prior to public exhibition in April 2013 noting further amendments to the draft pending Council determinations on draft section 64 and section 94 charges and sporting and halls management committees draft fees.

3. Council hold public meetings at Bega, Bermagui, Merimbula and Eden to discuss the proposed special rate variation.

The special variation application which is outlined in Council’s adopted Long Term Financial Plan, Asset Management Plans and Bega Valley 2013 (Operational Plan) and as previously reported to Council, is outlined below:

1. New 2% one-off permanent increase above the 3.4% rate peg in 2014, for renewal of collector roads. This variation will raise the general rate yield by an estimated $391,000 in 2014 and then be indexed by LGCI on an ongoing capacity. Total increase 5.4%.

2. Retained 2.5% one-off permanent increase above rate pegging in 2015 to retain the expiring recreation and access approval, with the options to use this amount for debt servicing or for annual project works in line with the LTFP for recreation asset renewals. This variation will retain the general rate yield at an estimated $516,000 and then be indexed by LGCI on an ongoing capacity.

3. New 2% one-off permanent increase above rate pegging in 2016 for infrastructure renewal for public domain areas and buildings. This variation will raise the general rate yield by an estimated $433,000 and then be indexed by LGCI on an ongoing capacity.

The rate variations are a one-off % lift in total general rate income. With an expiring special variation, the value of a rate variation (including effect of rate pegs) is removed from the total rate income. An application to IPART anticipates the value of the rate peg, plus the amount above rate peg that is sought.

IPART assesses council applications for special variations using criteria set by the NSW Government. The criteria are set out in guidelines provided by the Division of Local Government. A copy of the guidelines is available on the Division of Local Government website.

Prior to lodging a (permanent) s508A application, Council must have completed its Community Strategic Plan and all associated plans and reports - in particular outlining the special variation in the relevant Asset Management Plans and the LTFP. Bega Valley Shire has outlined the intent and purpose of the rate variations proposed within those documents as required, initially proposing annual rate variations for 10 years in accord with the recommendations of Prof Percy Allan following the ‘asset and financial sustainability review’ in 2010, then modifying those to the three proposed rate variations following council’s ‘asset and services’ review in 2011.

ISSUES

Legal

If Council is to progress a s508A special variation application to rate income there are specific requirements that must be followed. Council must also formally resolve to lodge the application.

Asset

The core intent of the special variation model is to address the growing maintenance and renewal backlog in the areas of collector roads, recreation assets, public domains and public buildings.

Strategic

Should Council resolve to delay or not continue with an application Council’s long term plans will be required to be reviewed and re-exhibited prior to adoption before 30 June 2013.

Consultation

Councils are required to engage with their community in relation to special variation applications and be able to demonstrate support for a s508A application. Council is required to advertise its draft plans and any proposed special variation. Council commenced consultation and engagement in 2012 and placed the proposed special variation on public exhibition for the period February 7 2013 to 6 March 2013.

In relation to Council’s proposed special variation application for increases to rate income above rate pegging, Council undertook detailed engagement. This commenced with Council’s community satisfaction survey on services and priorities and deliberative survey in November 2012.

In late January 2013 Council hosted focus meetings with key community, media and interest groups in relation to the proposals for rate increases for renewal of collector roads and community buildings, and retention of the sports and access variation.

A rates information brochure was prepared for distribution and was available on Council’s web site. An on line rates calculator was also available so ratepayers could calculate the impact on their rates for the three year period.

Groups involved in the focus group consultations included :

· Bega Valley Shire Ratepayers Association

· Media

· Sport and recreation / facility committees

· General halls committee

· Chambers of Commerce, truck and bus operators, farmer association

Issues raised through these consultation sessions will be considered by Councillors at a workshop and the final report published at the conclusion of the exhibition period.

Consultations held over February/March 2013

The key elements of informing and engaging with the community held over the period of the public exhibition are outlined below:

· Web site and online rates calculator – Council’s web site included the complete proposal, and a rates calculator where enquirers could input their new 2013 property valuation details and calculate the potential rates effect

· Special Variation Brochure – an updated booklet outlining the proposal, the purpose and effects of the proposal was available on line and in hard copy. Hard copy brochures were available from Council and library branches.

· Media – media staff were invited to a briefing with the Mayor on the special variation proposal and the draft operational plan and budget. Council provided regular media information about the proposal over the period of public exhibition. The Mayor and Councillors also indicated that they were available to meet with the media on the proposal. Media representatives also attended community information and question and answer sessions in Merimbula and Eden. The Mayor has provided regular radio interviews about the proposal and the consultations.

· Bega Valley Views – Council’s online consultation forum included polls, calculators and links to documents as well as specific discussion forums about the proposal, enabling community members to provide feedback to the Councillors.

· Deliberative survey questionnaire– this was made broadly available online following the completion of the independent survey period.

· Community Link – a summary of the information provided in the special variation brochure was run in Council’s Community Link page in local print media

Public Meetings

The Mayor and Councillors hosted a series of community forums on the special variation over the period of public exhibition.

Forums were held in Bermagui, Bega, Merimbula and Eden. The forums provided rate payers the opportunity to meet with Councillors and informally ask questions as well as accurately calculate the impact of the proposal on their rates. Council staff were available with computers to assist community members calcite the rate impacts.

Whilst small numbers attended these sessions (Bermagui 6, Bega 3, Merimbula 20, Eden 4 with 2 media representatives) the discussions were informed and robust.

The sessions were divided into two parts. In the first session members of the public were invited to bring a copy of their last rates notice and their new valuation notice from the Valuer General so that they could be show the real impact on their rates for the period of the special variation.

The second session was a more formal forum chaired by the Mayor outlining the proposal, its objectives and potential impacts, providing responses to questions and issues raised and asking for an indication of support or otherwise for the proposal.

Key issues raised in consultations and engagement

Whilst the period of public exhibition has not concluded at the time of preparing this report there have been a number of key themes raised throughout the consultation process. These are summarised for Councillors consideration below:

1. Affordability and capacity to pay – a number of the people raised the issue of the impact of any proposed increases on pensioners and self-funded retirees. The issue of the pensioner rebate being capped at the same level for a number of years was raised and the impact of other cost increases for services such as electricity, gas, petrol and telecommunications was also raised.

2. Council efficiencies – members of the community wanted to be assured that the request for rate increases was the last option after Council had considered all areas to trim costs and reduce the burden on ratepayers. The option of funding the proposal thorugh further efficiencies or cuts was also raised.

3. Concerns that whilst this proposal covered the period of a Council term, that a new Council may come in 2016 and add to the burden.

4. The impact of not taking up the proposal on infrastructure was raised.

5. Concerns over quality of road repairs and the perception of money being wasted on patching jobs needing reworking within a short period.

6. Confusion over the impact of the recent land revaluation and its potential impact on individual property rates.

Submissions

The final report on the submissions received will be presented by separate cover at the conclusion of the exhibition period.

Financial

The table below illustrates the rate yield with the rate peg only, compared to the effect of the rate variations, if approved.

Rate category	Properties	Old LV ($m)	New LV ($m)	2014 rate yield (rate peg only)	2014 rate yield (rate peg and SV)	2015 rate yield (rate peg and SV)	2016 rate yield (rate peg and SV)
Residential	17,281	$2,559,081,995	$2,410,231,818	$16,144,985	$16,685,627	$17,603,336	$18,914,360
Business	1,004	$394,200,020	$370,867,000	$1,792,948	$1,852,988	$1,954,902	$2,100,495
Farmland	850	$274,508,030	$246,823,385	$2,066,546	$2,135,748	$2,253,215	$2,421,025
	19,135	$3,227,790,045	$3,027,922,203	$20,004,479	$20,674,363	$21,811,453	$23,435,880

Conclusion

Council’s proposal for a special variation to rate income over a three year period has been considered by the Council and the community since the consultation period for the Council’s community strategic plan in 2010. The proposal is included in Council’s adopted Long Term Financial Plan and the proposal was identified as a key project for consultation with the community in the 2013 Operational Plan.

Council has considered the matter on three occasions and has undertaken considerable engagement with the community

ATTACHMENTS

Nil

Recommendation

That Council submit an application to IPART consistent with the proposal adopted in Council’s Long Term Financial Plan and outlined in the draft operational plan 2013-14.

That Council undertake a review of its long term plans and then reconsider an application to IPART