Auckland business groups concerned by rates grab

Auckland business groups concerned about a residential rates grab

Auckland business associations are concerned that the final piece of 'Super City' legislation, under debate in Parliament, is set to limit their access to the top and could mean business districts effectively lose control and possibly rates revenue to local boards.

“We are very concerned that the Local Government (Auckland Law Reform) Bill means Auckland’s many business districts will lose their autonomy and direct access to the Auckland Council. We’re very happy to sit alongside local boards, but we don’t want to sit beneath them, says spokesman Cameron Brewer, who is chief executive of the Newmarket Business Association.

“Overall we support the refinements of the 3rd bill that introduce more local democracy. However when it comes to the targeted rates applied to business we are concerned that they may be grabbed by the residentially-focused suburban boards,” says Alex Swney, chief executive of Heart of the City.

“Between the 41 business districts, we represent in excess of 40,000 Auckland businesses across the region. We don’t believe business associations and BIDS (Business Improvement Districts) should be ultimately answerable to local boards run by residents, many of whom won’t understand retail, commercial and industrial ratepayers’ needs,” says Mr Brewer.

“Traditionally business associations have been ultimately responsible to their local businesses and property owners in some cases for the best part of a century. After all they pay the targeted rate, not residents. Why should local boards be allowed to move into town and start calling the shots?

“We’ve always sat alongside community boards and have maintained a direct relationship with and access to the main municipal authority. That model should have remained under the new Auckland Council,” says Mt Brewer.

“We’re told in time local boards will decide the fate of business associations in their area. That is wrong. Business associations were set up by business communities who have voted to support a targeted rate, and constitutionally if enough members want to dis-establish their association it can be done. We have a long history of self-governance.

“It’s very dangerous territory when a not-for-profit organisation’s self-determination is taken from its founding and financial members, and placed in the hands of a newly-formed elected board of outsiders,” says Cameron Brewer.

Alex Swney: “It fails the key test that links taxation and representation. Reporting via a residential board is nebulous to say the least. The existing model that sees business associations in regular communication with the local board but reporting through its funding master – council – is much more logical and pragmatic.”

Mr Brewer said business associations are also worried that local boards will potentially start viewing them as cash cows to help fund infrastructural upgrades for example – when the likes of town centre upgrades have traditionally been funded from general rates.

"We've always had council and community board representation around our table and that is helpful and right. However we’re against an outside authority now being given the power to call the shots on decisions around the targeted rate, marketing and branding, and what projects we should engage in, as spelled out in the third bill."

Mr Brewer says Auckland’s business associations have pleaded to MPs, currently debating the bill in its third reading, to look at changing the structure, and return some power to the people, as was achieved with the CCOs recently.

“The Auckland Transition Agency argues business associations fall under local boards because they are non-regulatory and local. However we strongly believe that given the critical role business plays in Auckland, the health and wealth of our business districts is not a local issue. Business success is of Auckland-wide significance and hence we do not deserve to be pushed down the pecking order,” says Cameron Brewer.

ENDS

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