2014-01-13 Item 6.3 Appendices 1-5

               Total de-amalgamation costs per Proponent Council rateable property ($)
        300


        250


        200


        150


        100


          50


           -
                     Year 1               Year 2              Year 3              Year 4              Year 5

                          One-off costs     Fixed assets     Incremental annual recurring costs



In the first year, each rateable property in the Proponent Council area will on average 1 need to
contribute an extra $260 in rates to cover the costs of de-amalgamation. In the second year, the
extra contribution will drop to $142 and is then expected to increase each year based on
inflation.


1.2      Assessment of financial viability – using QTC’s Base Case
The financial viability of the Existing Council, Proponent Council and Remaining Council was
assessed by QTC with reference to financial information provided by the Proponent, and the
Existing Council’s current five year forecasts as well as five year forecasts for their respective
Proponent Council and Remaining Council.

In order to derive its own Base Case set of 5 year financial forecasts for the Proponent and
Remaining Councils, QTC made adjustments to the assumptions of the Proponent Council
and Existing Council where they were not considered to be complete and/or reasonable.

QTC’s Base Case financial forecasts for the Proponent Council and Remaining Council
included a cost allocation that might occur because of decreased purchasing power with
suppliers including insurance, waste management, fleet leasing and other expenses, as well as
other inefficiencies.

QTC’s financial forecasts for the Proponent Council also included the items identified in its
assessment of de-amalgamation costs. That is:
      the one-off costs of de-amalgamation for itself and the Existing Council
      the additional fixed asset costs, and

1 Rates per rateable property may bear no direct comparison to actual rates paid by some ratepayers because it is

an average figure calculated using total rateable properties. It does not take into consideration that some
residential, commercial and industrial rateable properties attract a higher portion of the base rate than others.


De-amalgamation Analysis of Sunshine Coast Regional Council                                                    Page 4