Council has $153.5 million debt
ROCKHAMPTON Regional Council ran up a deficit of $10.2 million in the last financial year and now has debts of $153.5 million.
But Mayor Brad Carter says the authority is on track to get its annual budget to break-even by 2014-15.
The deficit was “slightly worse than anticipated” largely due to an increase in depreciation on the council’s considerable assets. He says the forecast for the current financial year is another operating deficit of $8.6 million.
In the council’s community financial report for the year ended June 30, 2010, it is revealed that the net value of assets owned by the council improved by $28.8 million to stand at approximately $2.3 billion.
“Council continues to be in a strong financial position. It is holding a good reserve of cash, has substantial equity in its assets, and maintains debt at manageable levels,” says the report.
“The healthy financial position, combined with sound budgeting and forward planning, provides capacity for the council to meet its objectives as well as provide a large degree of flexibility if strategic directions change.”
The authority’s reserves were $71 million at the end of June of which $36.4 million is held in a reserve which must be spent on future capital projects. Interest from investments totalled $1.9 million.
Last year the budget was underspent by about $10 million as a result of projects which were not completed during the financial period. All that money is being carried over into the current financial year to complete those projects.
The report concludes: “Council is well placed to provide the necessary financial resources to address the land use, natural resource, environmental, economic and social challenges association with developing growth across the region.”
It says the aim is to continue to maintain a strong financial base through the prudent use of annual rates collection, grants and subsidies, developers’ contributions, borrowings and the use of specific cash reserves.
Cr Carter says he will be looking to a greater financial contribution from the council’s business interests, such as the airport.
For each 1% rise in council rates income increases by $1,272,484.