2014-12-15 General Committee Agenda

GENERAL COMMITTEE MEETING AGENDA                                            15 DECEMBER 2014


There is no argument that the levy was valid throughout the period 1 July 2000 to 30 June 2014
in terms of its ability to levy property owners. There is however, a question about how the
previous Councils should have dealt with any surpluses that arose each year with the levy.
Essentially, the way that both the former Noosa Council and the Sunshine Coast Regional
Council dealt with the levy was to adopt an overall plan for one year with that same plan being
adopted each subsequent year. There is a question as to whether this gave the Councils the
ability to carry forward any surplus funds from year to year or whether each year, there was an
overall plan that was effectively self-contained i.e. the revenue and expenditure should be
balanced and if there was any surplus from a particular financial year, it should be returned to
those ratepayers who paid the levy at the end of the period of the overall plan i.e. at the end of
each financial year.

Suggested Way Ahead

The current reserve is not required for current or future Noosa Waters lock and weir
maintenance, replacement and other operational expenditure requirements. Financial modelling
undertaken demonstrates that those costs can be met from the current 2014/15 levy and future
levies. The current and future proposed levies have been reviewed by the Director Corporate
Services and the Director Planning & Infrastructure in conjunction with representatives from the
Noosa Waters Residents Association.

At the same time, there could be some doubt about whether Council has had the ability to “roll
forward” annual surpluses into the Noosa Waters lock and weir reserve. On this basis, it is
suggested that Council refund the surplus funds as they cannot be used for any other purpose.
This will have the dual benefit of removing any risk of challenge to Council holding funds that
have been accumulated from its annual levy and also recognising that those funds are no longer
needed.

The CEO sought legal advice from King and Co about the legislative obligations in relation to this
issue. King and Co has provided advice in relation to section 96 of the Local Government
Regulation. Section 96 provides as follows:-

(1)   This section applies if—
      (a) a local government implements an overall plan; and
      (b) the local government has not spent all the special rates or charges.
(2)   The local government must, as soon as practicable, pay the unspent special rates or
      charges to the current owners of the land on which the special rates or charges were
      levied.
(3)   The payments to the current owners must be in the same proportions as the special rates
      or charges were last levied.

The previous Regulation and Act had similar provisions. The net effect of the legal advice from
King and Co is as follows:

 Council does not have one reserve but in fact has, in a legal sense, 14 different reserves
   representing the surplus balance from each year since the levy’s inception in 2000/01;
 In providing a refund, Council would have an obligation to refund any unspent funds to the
   owner of the properties who paid the levy in each year;
 As such, Council would need to identify the balance of the surplus funds from each financial
   year and also identify who owned the property at the end of each financial year; and
 Council cannot achieve legislative compliance by simply refunding the total amount of the
   current reserve to the current owners of the properties.




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