Upper Hunter Shire Council (UHSC) will pursue a 33 per cent rate rise to rectify its dire financial situation, while also revealing a council-run festival flopped to the tune of $133,000.
The council will write to the Independent Pricing and Regulatory Tribunal requesting a special rate variation of 10 per cent a year for three years, for a permanent cumulative increase of 33.1 per cent.
Earlier this year, the Newcastle Herald revealed UHSC would operate with a deficit until 2032 due to a $32 million debt, which is nearly three times its annual ratepayer base.
Council says that by the end of the final year, residents would pay about $322 extra a year, or roughly $6.20 a week.
Several residents addressed the council before the meeting, opposing the rate rise and questioning the council's ability to make sound financial decisions, including its management of the Warbirds Over Scone event.
The 2024 airshow incurred a loss of $133,976, "primarily due to lower than expected ticket sales".
"By comparison, the 2022 Warbirds Over Scone event incurred a loss of $219,878. Accordingly, despite the loss sustained by the 2024 event, the net result is a marked improvement on the 2022 event result," council papers said.
Council estimated the event generated $2.8 million in economic activity, but, with the past two airshows combining for a $350,000 loss, the councillors voted to take a step back from the event and call for expressions of interest from parties to hire the facility and operate future airshows independently.
Scone resident Robin Wills told the council his last water and rates notice was $6000, and questioned why the council had fielded offers for its Early Learning Centre (ELC), which was making a small profit, while pushing the Warbirds that operated at a massive loss.
"[The Warbirds] costs council a truly staggering amount of money," he said.
"On one hand you have the cost neutral ELC for sale, yet Warbirds is burning through hundreds of thousands of dollars by itself."
Councillor Lee Watts voted against the rate rise, citing the financial burden it would put on a community that was already struggling through a cost of living crisis.
"Now is not the time for rate rises, we need to find alternative ways to make ends meet," Cr Watts said.
"We need to make better decisions. I am not convinced, I don't think it's the only way forward."
Many of the councillors blame state and federal governments for UPSC's financial position, citing insufficient funding and cost-shifting.
Mayor Maurice Collison said the council didn't have any alternatives but to pursue the SRV.
"I'm not sure if I'll be back again or not [after the upcoming council elections], but someone's got some very hard thinking to do if this is not granted," Cr Collison said.
Councillor Ron Campbell agreed "nobody wants this", however the community had to "face the fact and look at what is happening to our council", while Cr Allison McPhee said without the rate rise council would have to reduce its services.
Should IPART grant the rate rise, it would kick in the 2025-26 financial year.
NSW Local Government Minister Ron Hoenig says he is "aware there have been some concerns raised" about the UHSC financial position, but he is reluctant to intervene.
