Despite several councils denying there is any increase to farm rates in their 2020-21 draft budgets when looking at the rate of the dollar, the income they expect to receive from farm owners through rates is expected to increase.
While councils are forced by law to cap increases at two per cent for 2020-21, this cap only affects overall rates revenue, not individuals’ bills or parts of a council's overall rates revenue.
Moira Shire Council's corporate general manager Simon Rennie said the rate in the dollar for farms in Moira Shire had decreased by two per cent, but a closer look at the draft budget and the estimated total amount to be raised by general rates for farm buildings and farm vacant categories shows increases of 1.2 and 0.8 per cent respectively.
In the Shepparton area, Greater Shepparton City Council is expecting to receive 5.88 per cent more from farm rates next financial year, compared to 2019-20.
“No changes are proposed to the current rating differentials which, in particular, sees farming properties pay a discounted rate in the dollar (90 per cent) compared to residential/general (100 per cent) and commercial/industrial (205 per cent) groups,” Greater Shepparton City Council rates and finance manager Matt Jarvis said.
“Any increases for individual ratepayers outside of the two per cent rate cap increase will be influenced by movements in property valuations.
“These independent valuations are conducted on an annual basis by the Victorian Valuer-General.
“The draft valuations provided by the Valuer-General at the time of the draft budget indicate farming properties have on average seen a nine per cent increase in valuations.”
Strathbogie Shire Mayor Amanda McClaren acknowledged the impact the Valuer-General's valuations have on farm rates and said the council had acted to reduce the burden.
“Over the past two years this council has reduced rates for farmers by a further five per cent, meaning they now pay 20 per cent less than residential ratepayers,” she said.
“We understand the effects of the Valuer-General’s annual valuations and have proactively changed our differential rating structure to provide our farmers more relief.”
The VFF is calling for this adaptability to be consistent across the state.
“Victorian agriculture cannot be expected to shoulder an even greater rating burden as we work to help rebuild the state's economy in the wake of COVID-19,” VFF president David Jochinke said.
“Victoria’s rating system has created the situation whereby all regional and rural ratepayers pay more in rates as a percentage of the value of their property than ratepayers in metropolitan Melbourne.
“What's more, regional and rural ratepayers often receive and have access to fewer services from local government than ratepayers in the city.”
Dookie cropping farmer Steve Ludeman said despite farm values increasing this shouldn't be the way the rating system works.
“Two years ago, our rates went up a ridiculous amount, it went up 50 per cent on some blocks,” he said.
“They are basing that on the farm value increasing, which it has, but it's unfair how the rating system works.
“I can’t understand why it can't be done on a per person per household basis, and no-one can explain why that can't be done.”