Showing its age

By Paul Pickering
KNOX City Council will tonight announce its plan to introduce a two per cent infrastructure levy to its rating scheme.
The levy will be spent on renewing and maintaining Knox’s ageing roads, drains, footpaths, parks and amenities.
Knox’s director of corporate development, Mick Jaensch, said the levy would address an infrastructure funding shortfall in the municipality.
“Our ability to renew our assets is about $3.7 million below where it needs to be,” Mr Jaensch said.
“We need to close that gap.
“The plan provides for the funding of that shortfall over a three-year period.”
The levy, which will equate to an average of $17 per household, will accompany rolling rate increases averaging around four per cent over the next five years.
The additional fees will be put before the Strategic Planning Committee tonight as part of Knox’s Long Term Financial Strategy (LTFS) document.
In accordance with the growing prevalence of asset management strategy within local government, Knox has recently conducted a series of asset reviews.
As well as identifying a widening gap between current and required funding, the reviews uncovered a worrying backlog in works needed to maintain the municipality’s ageing infrastructure.
Director of engineering and infrastructure Ian Bell said the backlog was in the order of $30 million.
“It’s actually deteriorating at a greater rate than we’re putting money into it,” he said.
Knox Mayor Jim Penna said, “If we did nothing and sat on our hands that would be accumulating the backlog for future generations.”
The council projects that the implementation of the LTFS will enable it to address the backlog passed on by its predecessors, placing Knox in a financially sustainable position within five years.
Cr Penna said the decision to separate the infrastructure levy from the general rate increase was based on the council’s commitment to transparency.
“We wanted to be open and we wanted to be transparent, and we wanted to show residents on a year-by-year basis how we’re applying that levy to our infrastructure renewal,” he said.
Mr Jaensch said the rolling rate increase would also rectify a turbulent period in Knox’s rating system.
“By acting responsibly now we are hoping for a smoother approach to rating in the future,” he said.
The council was also keen to note that problems with funding the renewal of infrastructure were being experienced across the state – with Victoria’s current funding gap approaching $280 million.
“The overall increase in rates across Victoria last year was 7.6 per cent, so even with this levy we’re still underneath that,” Mr Jaensch said.
Knox CEO Graeme Emonson said the LTFS would be put out for community consultation after tonight’s discussions, with residents invited to comment on the plan until 4 May.
The Knox Ratepayers Association was not willing to comment on the LTFS until members had a chance to discuss the plan at length.