2014-01-13 Item 6.3 Appendices 1-5

4.3.1 Base Case average annual rates per rateable property

Table 16 shows the average net rates and utilities per rateable property that would apply using
QTC’s Base Case for the Proponent Council.

TABLE 16 – BASE CASE AVERAGE ANNUAL NET RATES AND UTILITIES PER RATEABLE PROPERTY

                            FY2013    FY2014    FY2015    FY2016       FY2017

Proponent Council ($)       1,894      2,000     2,114        2,234    2,362



4.3.2 Breakeven average annual rates per rateable property

QTC considers that a balanced operating result is essential to a council’s long term financial
sustainability. Table 17 shows the estimated incremental increase / (decrease) in net rates and
utilities per rateable property that would apply if de-amalgamation was successful and the
Proponent Council was to achieve a balanced operating result (ie, the breakeven rates).

TABLE 17 - CHANGE IN AVERAGE ANNUAL NET RATES AND UTILITIES PER RATEABLE PROPERTY
– BREAKEVEN CASE INCREMENTAL TO BASE CASE

                             FY2013    FY2014    FY2015       FY2016   FY2017
Breakeven case
Proponent Council ($)           101        14        23          46         4
Change from Base Case (%)        5%        1%        1%          2%        0%



The required increases per rateable property in the Breakeven Case when compared to the
Base Case five year forecasts reflect:
      the elimination of operating deficits in the Base Case
      the cost increases attributable to the impact of de-amalgamation, with the upfront costs
       being incurred in FY2013 and other costs expensed in future years, and
      the impact of increased operating expenses associated with a reduction in economies of
       scale and efficiency.

Additional revenue would not rectify the debt servicing issues experienced by the Proponent
Council. Borrowings would still be required to fund the significant forecast capital expenditure
program.




De-amalgamation Analysis of Sunshine Coast Regional Council                               Page 26