Council adopts 10% rates increase
CEO Money needed to fund major capital projects
“Black Friday” was the epithet independent councillor Shane P O’Reilly branded the day councillors adopted the 2022 local authority budget. Set against a backdrop of retailers grappling with a pandemic, Cavan County Council opted to increase the rates multiplier by 0.2211 to ensure the “long-term economic stability” of the authority.
Elected members gathered for the local authority’s budget meeting at the Cavan Crystal Hotel. The change will equate to a 10% hike in the cost of the annual rates for most businesses in the county.
Tommy Ryan, CEO of the authority, said the increase was essential to match funding for projects to the value of €40M approved for the county. “Our income from the Local Government Fund has been static for eight years now,” Mr Ryan said, adding that declining revenue from NPPR and landfill operations resulted in reduced income for the authority.
Although the Local Property Tax (LPT) went up at the start of 2021, the council voted in July not to increase it for the coming year. Mr Ryan outlined a number of funds the council have accessed for development projects saying: “We have, as a council, invested significant local resources into that, to secure funding for those schemes.”
The funding will facilitate the Abbeylands urban regeneration, the Burren/Shannon Pot project, Virginia Civic Centre and Library, Bailieborough Courthouse project, Ballyconnell Market House renovation, Cootehill Enterprise Park, Cavan Townhall destination and outdoor performance, Cavan Regional Sports campus, and regeneration plans for Kingscourt and Ballyjamesduff.
He said of the €40M spend: “That requires us to have matched funding of €9.8M. There is no provision in our budget to date for that level of funding.”
The Council CEO said budgeting is about long-term considerations: “We have to continue developing projects, to have them in the pipeline for future applications. The development and approval of projects can take several years.”
Mr Ryan insisted that all the approved projects will assist businesses, job creation and improve the environs of towns. He said the council was aware declining income would force a rates increase: “It [Cavan’s rates] is one of the lowest in the country. It has been static for many years, in fact it has decreased for many ratepayers when the base readjustment was changed in 2018.”
The Chief Executive acknowledged the difficult trading environment: “There are challenges for business, and for everyone, over the last two years. We have had significant funding from government to support the local authority and the ratepayers in the county during this period.”
Supports for ratepayers have totalled €5.9M in 2020 under the waiver scheme, while €4.1 in subvention was spent in 2021. Restart grants for the county totalled €20M.
Mr Ryan said €800,000 of the 0.2211 increase in the rate of evaluation is ring fenced for loan repayments. He went on to tell members that economic predications for the coming year were positive, but added: “Let us hope this pandemic comes to an end and there is significant growth for the whole of the county.”
To ease the burden of the proposal on the small to medium enterprises in Cavan, there’s a small business rates incentive scheme. This will see a 5% reduction in the overall rates payment to business who commit to pay the their rates bill in full by October of next year.
Head of Finance, Margaret McNally broke down the numbers of the budget for the members. Ms McNally told members the Draft Budget for 2022 provides for total Expenditure of €81,463,851, an increase of €2,711,509 on the adopted figure from 2021.
In addressing the proposed budget Cllr John Paul Feeley (FF) spoke of the challenge of balancing the means of the County Council to fulfil the local authority’s obligations. He praised the Executive’s efforts to capitalise on government commitments to “getting funding into the region”.
Cllr Feeley said this would be the one and only increase in the rates “in the life of this council”.
The Fianna Fáil elected representative highlighted business supports, road programmes, as well as the capital projects outlined by the CEO as areas that require funding. Cllr Feeley said supporting these projects would change Cavan: “We have the capacity, in terms of staff and services, to make the application to draw down the funding we need to help transform the county.”
Cllr TP O’Reilly (FG) echoed his colleagues’ comments saying it was “not an easy step to take”. He said Budget 2022 was an important move forward, but added “there is never a good day to announce a rates increase”. Cllr TP O’Reilly spoke of the importance of the capital projects to the local economy. He said it was important to “grasp the nettle” and that matching funding of €9.8M for the €40M projects was a good return for the county and failure to do so would be a missed opportunity. Cllr TP O’Reilly also stressed there would be no further rates increase in the lifetime of the current local authority.
Addressing the meeting Cllr Shane P O’Reilly referenced the increase in the property charge in 2020, but said he was unhappy with this rates’ increase: “The LPT rise was fair, because it was ‘the many’ not ‘the few’. Today what has been done by the two main parties is a 10% increase in rates in the county for the coming year. It’s going to be the few that shoulder the burden of the many,” Cllr SP O’Reilly said.
“The people who will find this the most are our rate collectors. They are the coalface of our organisation,” he said at the meeting, “today is Black Friday, and it is a queer black Friday for retailers in this county.”
Despite Cllr O’Reilly’s objections members unanimously voted to approve the 2022 Budget including the 0.2211 multiplier increase.