Council is considering making an application to the Independent Pricing and Regulatory Tribunal (IPART) for a special rate variation to secure the funding our City and community will need for future works and services. Our aim is to provide the best possible services to our community while remaining financially sustainable into the future. This booklet explains three funding options Council has developed in consultation with the community. We’re inviting you to find out about each option, and tell us which one you prefer at http://haveyoursaylakemac.com.au/securingourfuture

1. We’ve listened.
Now it’s time for you to tell us
your preferred funding option.
Important information about
your Council rates and services.
Contact Us Lake Macquarie City Council phone: 02 4921 0333 fax: 02 4958 7257
web: www.lakemac.com.au email: council@lakemac.nsw.gov.au post: Box 1906 HRMC NSW 2310
Designed by Lakemac Print.

2. MAYOR’S RECENT
INTRODUCTION ACHIEVEMENTS
Council is considering Lake Macquarie City Council achieved 83%
making an application to of its Operational Plan targets last financial
the Independent Pricing and year (2010/2011), with major highlights being
Regulatory Tribunal (IPART) environmental works on 26 sites around the
for a special rate variation to City, completion of the Fernleigh Track to
secure the funding our City Belmont, and receiving a national award for
and community will need for climate change adaptation programs.
future works and services. The final stages of the Fernleigh Track officially opened
Our aim is to provide the best possible services to our in April, and the 15km route now links Adamstown
community while remaining financially sustainable into to Belmont. It has become one of the region’s most
the future. popular shared pathways.
Council has managed to balance its budget for many Council was named 1 of 6 Climate Change Adaptation
years, but with each passing year this has become Champions from around Australia for the steps we
increasingly difficult. It is clear that ‘business as usual’ is have taken to prepare for the impact of climate change.
no longer an option and that we need to change the way Since 2007, Council has actively researched and taken
we fund our assets and services, or go down the path of action to adapt to predicted changes, with a priority on
making some serious cuts. the effects of sea level rise and increased flooding.
Families are taking advantage of the now complete
Council undertakes extensive community consultation
Lake Macquarie Variety Playground, which boasts a
each year as we develop our operational plans
flying fox, climbing structure, amenities building, and
and delivery programs. We have undertaken more
cafe. The playground has special features for children
consultation in 2011 as we look to confirm which
with disabilities, and continues to be one of the most
services you value the most, and try to strike the right
loved attractions in our City.
balance between the services you want and those you
are willing to pay for through your rates.
Many people attended the series of Securing our Future
community workshops held in July, joined our online
forum, and used our budget allocator tool over recent
months. Most participants were reluctant to see cuts
to services or the sale of Council assets to fund budget
shortfalls. Indeed, many indicated they would be happy
to see an increase in rates to maintain or improve the
services and assets they value, so long as the increase
was reasonable.
Based on this feedback, Council has developed
three funding options to present to the community for
consideration. Lake Macquarie’s biggest and best skate park is also
These options, explained on pages 6-13, have been proving very popular. The new park in Chapman Oval,
based on community priorities identified through the Swansea, was officially opened in March. The 60m
Securing our Future consultation. The options also long skate park was designed in collaboration with
respond to the community’s vision as reflected in our local users.
10 Year Community Plan. Council’s inaugural Living Smart Festival attracted a
crowd of 8,000 to Speers Point Park last year. The
We are asking you to tell us which of these three options
event is an educational and inspirational celebration of
you prefer. We will use the results of feedback from the
sustainable living through music, dance, performance,
community to determine the level of rate increase we will
workshops, art, fashion, and food. This year’s event will
seek from IPART. The final decision on whether Council
be held on Saturday 19 November and will feature the
can increase its rate income will be made by IPART in
Hunter Valley Electric Vehicle Show.
June next year.
I urge you to take the time to read the information
contained in this brochure and tell us your preferred
option. Your feedback will have an effect on the future of Lake Macquarie City Council recently
Council and the City of Lake Macquarie. won a Local Government Award for
Excellence in Financial Reporting for
Councillor Greg Piper the presentation of our 2009/2010
Mayor of Lake Macquarie Financial Statements.
2

3. WHAT YOU NEED TO KNOW
People who live in Lake Macquarie value a quality lifestyle, This booklet explains three funding options Council has
based around our beautiful lake, coastline, and bushland. developed in consultation with the community.
For Council, delivering this quality of life comes down
to maintaining and improving our assets – our natural Option 1:
environment, as well as our community infrastructure – Reduce Services – Maintain Rates
our roads and cycleways, sporting and cultural facilities,
parks and playgrounds, and vibrant town centres.
Option 2:
This vision is captured in our 10 Year Community Plan, Maintain Services – Increase Rates
which sets out our shared goals and aspirations for
the future.
Option 3:
While we are committed to this vision, like many other
councils in NSW we face financial pressures. Rising costs Improve Services – Increase Rates
and limits to our income mean that without securing
additional funds, Council can no longer deliver the services We’re inviting you to find out about each option,
and infrastructure our community needs and expects. and tell us which one you prefer.
WHAT WE ARE ASKING YOU TO DO
Find out why Council is looking to increase rates see page 4
STEP
1
Find out about the financial challenges facing Lake Macquarie, and why Council is seeking feedback on a
rate increase now. Read about what Council has been doing to improve our financial situation and reduce
the burden on ratepayers.
We explain how our rates and other fees and charges work, and how they compare to those of similar
NSW councils.
Understand the three funding options see page 6
STEP
2
Read about the three options and what they mean for you. You can use our calculation tables to
understand how each option will impact on your rates.
Tell us your preferred option see page 16
STEP
3
Once you’ve decided which option you think is best, tell us!
See the back page of this booklet for details of how to register your choice by post, online, or at one of
our community forums in November.
Important information about your Council rates and services 3

4. OUR CURRENT SITUATION
In past years, Council has consistently delivered balanced WHAT IS RATE PEGGING?
budgets. However, cost increases have meant we have Rate pegging is the percentage limit by which all
had to draw on the City’s asset replacement reserves to councils in NSW may increase the total income they
achieve this result. The reality is, our operating deficit will will receive from rates. The rate peg is set annually by
continue to increase in years to come unless changes can the Independent Pricing and Regulatory Tribunal of
be made. If things stay the same, a $132M budget deficit NSW (IPART). The rate peg amount for the 2011/12
is projected over the next 7 years. financial year is 2.8%.
Current economic and legislative conditions – rate pegging,
cost shifting from other levels of government, and increasing ratepayers. This includes establishing LakeMac Enterprises,
costs – have all restricted our ability to meet existing and which has a strong focus on providing services to other
emerging community priorities from current income. NSW councils. It is anticipated that LakeMac Enterprises
Council has an extensive asset base, valued at over $2 can generate in excess of $1M for Lake Macquarie City
billion. Most of this is infrastructure used for the delivery of Council within 5 years.
services for the community, including roads, bridges, drains,
buildings, and parks. These assets deteriorate over time Why is Council looking to
and eventually require replacement. As Council has not had increase rates now?
sufficient funds to maintain and replace its infrastructure, a To achieve financial sustainability and manage the
backlog of works has built up. The current estimated cost to community’s infrastructure, we either need to increase
bring the infrastructure up to a satisfactory standard is $67M. our income by increasing rates, or reduce our expenditure
Deteriorating infrastructure is a major issue for local by decreasing the level of services we provide to our
government across Australia. In 2006, the total community.
infrastructure backlog for all NSW councils was estimated at
If NSW councils want to increase rates beyond the rate
$6.3 billion.
peg amount they have to apply to IPART for a special rate
Faced with these challenges, Council has first looked at variation, and in doing so must demonstrate extensive
ways to save money and increase income. consultation and significant support from the community.
Securing our Future is a 6-month consultation process
How do we know Council is efficient? Council is conducting with a view to making an application
Council commenced a comprehensive Service Review in to IPART in 2012. Applications close on 24 February 2012
2009, which demonstrated that our operations are already for rate increases commencing in the 2012/13 financial year.
lean. This analysis is supported by the Division of Local
Government’s comparative data, which shows that our You can find out more about Council’s financial
expenses per capita from continuing operations are below management by visiting www.haveyoursaylakemac.
the average for NSW councils. com.au/securingourfuture and downloading our
information sheets on Services, Revenue and Expenditure,
Council made approximately $4M in savings and Sustainability, Efficiency and Enterprise, and Assets.
improvements across the organisation as a result of the
review. By changing our purchasing practices we saved
$2.4M. The total benefit of the service review is estimated to
be $10M to $14M, achieved through efficiencies, savings,
HOW OUR
and additional income.
RATES COMPARE
2009/2010 AVERAGE EMPLOYEE COST PER CAPITA Our rate revenue per capita is low in comparison to similar
$700 NSW councils. This is despite having a larger population to
$600
service than most of our comparable councils except for
Wollongong, whose rates are much higher.
$500
$400
$300 $642
$642
$527
$527 $540
$540
$473
2009/2010 TOTAL RATE REVENUE PER CAPITA
$473
$200 $438
$438
$384
$384
$100
$0 $600
e
ffs as tle aven eed gong Lak arie $500
Co our wc oalh Tw llon
rb Ne Sh Wo cqu $400
Ha Ma
$300
$534
$534 $531
$531
Group 5 Councils $200 $383
$383
$451
$451 $441
$441
$371
$371
$100
*Note: Group 5 is a collection of councils throughout NSW – they are deemed $0
comparable as regional councils, part of an urban centre with a population over n ng e
ffs
Co our ast
le ave eed
ngo Lak arie
70,000, and predominantly urban in nature, as determined by the Division of wc oalh Tw llo cqu
rb Ne Sh Wo Ma
Local Government. Ha
Group 5 Councils
What is being done to develop
Source for tables above and left: Division of Local Government, Comparative
new income streams? Information on NSW Local Government Councils 09/10 - DLG Snapshot
of NSW Councils.
Council is developing a range of entrepreneurial activities
Australian Bureau of Statistics, Population Estimates by Local Government Area,
to generate additional revenue and reduce the burden on 2001 to 2010.
4

5. HOW OUR RATES COMPARE
2009/2010 2009/2010
RESIDENTIAL - AVERAGE RATE PER ASSESSMENT BUSINESS - AVERAGE RATE PER ASSESSMENT
ffs ave
n ed ng e
Co our ast
le
Tw
e ngo Lak arie
rb wc oalh llo cqu
Ha Ne Sh Wo Ma ffs le n ed ng e
Co our ast ave e Lak arie
wc oalh Tw ngo
Ha
rb Ne Sh Wo
llo cqu
Ma
Group 5 Councils
Group 5 Councils
Division of Local Government analysis shows that while our Keeping our business rates at an affordable level is an
residential rates are below average in comparison with the five important way that Council supports local enterprise
councils we are grouped with, our business rates are much and encourages employment close to the places we
lower. In fact, they fall well below the NSW State average. live. However, this analysis indicates an argument for a
reasonable increase to bring Lake Macquarie’s business
Source: Division of Local Government, Comparative Information on NSW
Local Government Councils 09/10 - DLG Snapshot of NSW Councils.
rates in line with the average business rates for our
Australian Bureau of Statistics, Population Estimates by Local Government Area,
comparable councils.
2001 to 2010.
HOW OUR RATES WORK Sustainability Levy
Currently the ordinary rate includes a special variation known
Council rates are determined in accordance with the as the Sustainability Levy. This Levy was introduced in July
provisions of the Local Government Act 1993. This legislation 2009 to fund environmental projects, including continuation
provides the mechanisms to calculate rates and limits the of lake water quality improvement works. The Levy finishes
income councils can derive from rates. in 2014. See page 14 for further detail.
Each property in Lake Macquarie falls into 1 of 4 categories Domestic Waste Management Charge
for rating purposes depending on the land use of the
property. The domestic waste management charge is an annual
charge for waste services that is listed as a separate amount
These categories are residential, business, farmland, and on your residential or farmland rates notice.
mining. Council decides which category your property should
be in based on its land use. It includes a levy charged by the state government.
Most NSW councils have to pay the levy, which they then
Rates are calculated annually, and include the ordinary rate have to pass on to ratepayers on a fee for service basis.
and annual charges. The ordinary rate includes a flat base Councils are not permitted to make a profit or loss.
amount, plus an ad valorem amount, which is based on
the value of your land. The ordinary rate also includes the In 2011/12 this charge is $349.00 for Lake Macquarie.
Sustainability Levy. For this, residents get a weekly kerbside collection, a
fortnightly recycling collection, bi-annual bulk waste
Land valuation is conducted every 3 years by the NSW Valuer collections, eWaste drop offs, and clean-out services for
General. The land value does not include the value of your the disposal of chemicals, sharps and oils. Awaba Waste
house, buildings, or other improvements to the land. Council Management Facility is also partly funded through this
uses this figure to calculate the ad valorem amount to reflect charge. In 2012/13 the charge will be $370.50.
any changes in the value of your land.
RATE CATEGORIES
ORDINARY RATE (includes Sustainability Levy) Residential Business Farmland Mining
Base Amount A flat rate that applies to all rateable properties. In 2011/12 this is $475.06 per ✓ ✓ ✓ ✓
residential property.
Ad Valorem (land value) A variable rate based on the value of your land. In 2011/12 for a residential ✓ ✓ ✓ ✓
property with a land value of $210,500, this is $474.90.
ANNUAL CHARGES Residential Business Farmland Mining
Domestic Waste A flat rate calculated annually on a cost recovery basis. In 2011/12 this is ✓ ✗ ✓ ✗
Management Charge $349.50 per property. In 2012/13 this will be $370.50.
Commercial Waste Charge A flat rate calculated annually. In 2011/12 this is $320.00 per property. ✗ ✓ ✗ ✓
In 2012/13 this will be $362.00.
Some properties not on mains sewerage may also pay an effluent removal charge.
For more information about our rates and charges, and how they are calculated, visit www.lakemac.com.au/council/rates
Important information about your Council rates and services 5

6. Option 1: Reduce Services – Maintain Rates
Average residential and business rate increase each year over 7 years: 3% rate cap only. 3% is the expected
rate cap to be set annually by IPART. If the actual percentage set by IPART is lower in the 7 years, then further reductions
in spending will be required.
This option will see a dramatic difference in community infrastructure and services over the
next 7 years. With income restricted by the rate peg, Council will need to make some big
changes to meet rising costs and achieve a balanced budget.
Reduction in maintenance of our City’s Reduction in environmental programs
assets and infrastructure and works
$20.8M will be saved over 7 years through a major The Sustainability Levy will not be extended beyond 2014.
reduction in city infrastructure maintenance. Without As a result there could be a decline in the quality of our
regular maintenance, the quality of our infrastructure and lake, coastline, and bushland. Vegetation maintenance
environment will decline over time, and more expensive programs for our foreshore reserves and for bushfire
reactive and emergency work may be needed. management will be affected. Environmental works and
programs, such as lake water quality programs, will reduce
Consequences could include:
significantly, as will programs to minimise pollution, waste
• Longer response times for requests for graffiti removal, generation, and resource consumption.
tree lopping, and vandalism repairs.
• Less frequent mowing, weed removal and spraying, Closure of major community facilities
gutter cleaning, and litter collection. This would result in a To save money, Council will need to close a number of
reduction in standards for users. For example, the grass in major facilities. In 2012/13 the Lake Macquarie Performing
our parks and playing fields could be longer. Our wetlands Arts Centre and 2 pools will close. One pool will be put
could also become choked with weeds and litter. out to contract for management. Libraries will be open for
• Safety and environmental hazards may increase, for reduced hours initially, then 5 libraries will close between
example trip hazards, unsafe trees, bushfire hazards, and 2013/14 and 2014/15. This will save $24M over 7 years.
soil erosion.
Reduced construction and maintenance of
Roads and drainage works reduced footpaths, cycleways, and traffic facilities
Our construction program for new footpaths, cycleways,
and traffic facilities will reduce by $4M over the 7 years. In
addition, no new boat ramps or jetties will be constructed,
saving $2.3M over 7 years.
Reductions in service levels across the
City and loss of 123 Council staff
Staffing reductions across all areas of Council will occur,
With $24.1M less budgeted for roadworks, such as kerb saving $42.6M over 7 years. With reduced staffing,
and guttering and resealing, the quality of our roads will response times for service requests and turnaround times
decline to a ‘fair’ condition within 10 years. for processing development applications will be longer.
The budget for replacement of failed drainage systems
and flood mitigation measures will reduce by $3.9M over
7 years. This will make it harder for our drainage system to
cope with major flooding events.
6

7. The Economic Development Department would be Limited new capital projects
disbanded, including closure of the Visitor Information New capital expenditure over the 7 years will be limited
Centre at Swansea. One staff position would be created to $240M. While Glendale Transport Interchange and
to assist employment generating development proponents the Lake Macquarie Waste Strategy will be funded, town
with site identification and approval processes, with a centre upgrades for Cardiff, Charlestown, Belmont, Toronto
second position created to assist in facilitating events that Morisset, Warners Bay, Glendale, Swansea and Mount
attract visitors to the City. This would effectively reduce Hutton will not go ahead under Option 1.
staffing for Economic Development from 7.4 to 2 full time
equivalent staff.
Financial Outcomes
Under Option 1 only about 77% (8,500 of the 11,000) Council will continue to experience an operating deficit over
service requests we receive each year will be completed. the 7-year period. The current $15.8M operating deficit
Requests that will be delayed or not carried out include would reduce to $8.5M by 2018/19. Council’s maintenance
footpath repairs, road patching, and graffiti removal. and infrastructure backlog will increase significantly.
Option 2: Maintain Services – Increase Rates
7.7% average residential rate increase each year (including 3% rate cap)
9.9% average business rate increase each year (including 3% rate cap)
This option will see Council services stay largely the same as they are now, with minimal
improvements or upgrades. However, the increase in income will not be enough to
maintain the condition of all our City assets and infrastructure, and the quality of our roads
will continue to decline, then hold in the ‘good’ range.
Funding maintained for maintenance of Drainage maintained
our City’s assets and infrastructure Current funding for replacement of failed drainage will be
Under this option, the maintenance of the City’s maintained, enabling Council to replace approximately 30%
infrastructure will continue to be funded at current levels for of drainage that fails.
the next 3 years.
Environmental programs and
In 2015/16 the annual maintenance program will increase by
approximately $1.5M per year until 2018/19. This will add works maintained
a total of $6M to infrastructure maintenance over the next
7 years. This increased spending will only keep pace with
inflation and an increase in the number of assets we have
to maintain. Requests for footpath repairs, road patching,
weed removal, plumbing repairs, and signage replacement
can continue to be responded to in a timely manner.
Road condition declines
Option 2 does not provide funds to stop the declining
Sustainability works and programs will continue beyond
quality of our roads. Although an additional $16M will be
2014/15, when the Sustainability Levy finishes. Continuing
allocated over 7 years, this funding will only keep pace with
programs include bushland and foreshore rehabilitation
rising cost increases. This means that the average condition
projects, and lake water quality improvement programs.
of our roads will continue to decline for the next few years,
See page 14 for details.
but will then hold in the ‘good’ range.
Important information about your Council rates and services 7

8. Community facilities remain open With the right levels of staff, we intend to maintain our
Rate increases under Option 2 will allow Council to keep the current turnaround times for processing development
Lake Macquarie Performing Arts Centre and pools open. applications.
Libraries will remain open in the short term; however, In addition, Ranger staffing will be increased, including
funding levels have been set at the same amount as weekend shifts and after hours services. Additional Ranger
2011/2012 budget. This means that as costs increase patrols on weekends will improve response times to
over time, levels of service and stock will need to decrease requests, and patrols and enforcement activities will be
to ensure the service can be provided within the budget increased during normal hours. The community will benefit
available. Consequently, reductions in opening hours, staff, from increased monitoring and enforcement of public health
book stock, and service points will be considered. and environmental standards.
Lake Macquarie Art Gallery will have all internal lights
changed to meet new environmental legislation at a cost of
$82,150.
Sporting and recreation facilities –
minimal improvements
Our pools will not be upgraded to standards reflected in
Council’s Pool Service Delivery Model. For example, the
proposed water play zone at Speers Point will not be
delivered under Option 2. New capital projects
Our pools will have resuscitation equipment and disability Total new capital expenditure over the 7 years will be
hoists upgraded at a cost of $140,200 over 7 years. $269M. Town centres will not be upgraded under Option 2.
The Glendale Transport Interchange and the Lake
Current staffing levels maintained and Macquarie Waste Strategy will be funded.
frontline staff increased
While Council will continue to find efficiencies in the way Financial
we operate, current levels of staff will be maintained across Council will continue to experience an operating deficit
all areas of Council. Maintaining staff levels means we until 2016/17, with an expected surplus of up to $5M in
can continue to respond in a timely manner to the 11,000 2018/19. The City’s infrastructure backlog of $67M will
maintenance requests we receive each year. only be partially addressed. Increased funding for roads, for
Current Economic Development staffing will be retained. example, only maintains roads at a ‘good’ condition in the
future due to increasing costs.
RATING THE CONDITION OF OUR ROADS
The following index is provided to assist in describing the condition of our roads:
1. Excellent condition 4. Fair
No surface defects, smooth surface. Rough surface, major cracking.
Significant renewal/upgrade required.
2. Very good
Minor cracking. 5. Poor
Minor maintenance required. Extensive surface and structural failure.
Requires replacement or removal.
3. Good
Noticeable cracking, surface defects. Information about each of Council’s roads is stored in a
Planned maintenance required. pavement management system, which allows us to track
the history of each road’s condition, any treatments, and
predict future condition.
8

9. Option 3: Improve Services – Increase Rates
9.8% average residential rate increase (including 3% rate cap)
12.8% average business rate increase each year (including 3% rate cap)
Under this option the community will see much of their vision as outlined in the 10 Year
Community Plan come to life. Option 3 is designed to deliver on priorities identified through
community consultation, and is based on what people have said they want to see more of,
or wish to see maintained or improved. The increased funding will allow Council to improve
levels of service to the community and support an additional program of works for roads,
pools, libraries, sports centres, parks and playgrounds, and upgrades to town centres.
Improvements in maintenance of our City’s Environmental programs and
assets and infrastructure works maintained
Funds will be injected into infrastructure renewal and Sustainability works and programs will continue beyond
maintenance across the City, with an additional $15M over 2014/15, when the Sustainability Levy finishes. See page 14
the 7-year period. for more detail.
This will significantly improve the standard of maintenance
and overall appearance of the City. Response times for Existing community facilities upgraded
maintenance requests will be reduced including vandalism and new facilities built
repairs, pothole patching, and drainage clearing.
Regular services such as litter removal, street sweeping,
and toilet cleaning will be conducted more frequently.
This amount allows for an increase in the number of assets
in the City over 7 years and recognises that maintenance
costs and community expectations change over time.
Roads and drainage improved
Rate increases under Option 3 will allow Council to keep
the Lake Macquarie Performing Arts Centre and pools
open. Council will also implement recommendations from
the Library Service Delivery Model, which proposes 2 new
libraries at Morisset and Glendale, costing $7.4M.
Lake Macquarie Art Gallery will be extended to incorporate
seminar rooms and the sculpture park will be extended in
the gallery grounds.
Under Option 3, the condition of our roads is expected The community will also benefit from:
to reach the ‘very good’ range within the next 10 years
• Rathmines Community Hall kitchen upgrade
through a program of targeted renewal. This will be
achieved through a $42M investment over the next 7 years • Renovation of Lambton Colliery, Redhead Community
in programs for road reconstruction and resurfacing. Buildings
Funding will be available to upgrade drainage infrastructure • Refurbishment of the Sugar Valley Neighbourhood Centre
and replace drainage that fails.
• A new amenity block at Warners Bay foreshore
Important information about your Council rates and services 9

10. Sporting and recreation facilities improved New Youth and Aboriginal Programs
Additional youth and Aboriginal programs will be delivered in
partnership with relevant organisations.
Current staffing maintained and frontline
staffing increased
Current staffing levels will be maintained and in addition,
Ranger staffing will be increased as per Option 2.
Under Option 3, $20.4M will be provided over 7 years New capital projects
to redevelop our pools according to recommendations New capital expenditure over the 7 years will increase to
in Council’s Pool Service Delivery Model. This includes $326M, and includes the works detailed above.
redevelopment of Charlestown Pool and a new water play In addition a program to upgrade town centres will be
zone at Speers Point. developed. $7M will be allocated over 7 years for upgrades
Our sport and recreation facilities will be improved and in 9 locations: Cardiff, Charlestown, Belmont, Toronto
extended across the City: Morisset, Warners Bay, Glendale, Swansea and Mount
• Sportsground improvements to playing surfaces, Hutton.
lighting, amenities, and car parks across the City The Glendale Transport Interchange and the Lake
($6M over 7 years) Macquarie Waste Strategy will be funded.
• Additional sporting fields at Edgeworth (funded in part
by developer contributions) ($5.3M) Financial
• Continued implementation of: Council will continue to experience a small operating deficit
- Cameron Park Master Plan – Sports Fields and Parks until 2016/17, with a surplus of up to $7M in 2018/19
(funded in part by developer contributions) projected. Option 3 addresses the $67M infrastructure
($7.6M over 5 years) backlog with roads ($30M backlog) improved and funding
- Speers Point Park Master Plan ($1.1M over 4 years) for future drainage renewals are provided.
- Toronto Foreshore Master Plan including new play
equipment
HOW WERE THESE OPTIONS DEVELOPED?
The funding options were developed based on our 10 Year Community Plan, as well as input gathered through the Securing
our Future consultation. Securing our Future is a 6-month community engagement process to raise awareness and consult
the community about Council’s financial sustainability. Between July and September this year, more than 400 people
attended forums held across the City. Council’s consultation website www.haveyoursaylakemac.com.au was also used
to gather community feedback through an online forum. Input was also sought from a community working group of 24
randomly selected yet demographically representative residents across all wards.
Forum participants were asked to identify which Council assets and services they valued most and would prioritise for future
funding. Our roads and cycleways, domestic and commercial waste collection, environmental programs – especially lake and
foreshore management, libraries, and park facilities were shown to be highly valued.
Results of the community engagement informed development of the three options Council is now presenting to the
community for consideration.
10

11. THE THREE OPTIONS AT A GLANCE
Option 1 Option 2 Option 3
KEY FEATURES • Services significantly reduced • Services largely maintained • Services improved
• Condition of our assets declines • Condition of our assets maintained at current • Delivers on 10 Year Community Plan
• Rates increase only by rate peg amount set rates of decline initially, then will hold • Condition of our assets improves
annually by IPART • Average residential rates increase 7.7% pa • Program of infrastructure renewal
• Average residential rates increase 3% pa • Average business rates increase 9.9% pa • Average residential rates increase 9.8% pa
• Average business rates increase 3% pa • Average business rates increase 12.8% pa
INFRASTRUCTURE A reduction of $20.8M over 7 years for Increased by $6M over 7 years to maintain Increased by $15M over 7 years to ensure Council
MAINTENANCE maintenance of City infrastructure maintenance standards and response times assets are well maintained and useful over their
predicted life
BOAT RAMPS No new boat ramps or jetties constructed, saving Current levels maintained Current levels maintained
& JETTIES $2.3M over 7 years
DRAINAGE $3.9M reduction over 7 years for replacement of Current funding levels maintained, enabling Funding available to replace drainage that fails
failed drainage infrastructure and construction of approximately 30% of drainage infrastructure that
flood mitigation measures fails to be replaced
ROADWORKS $20.4M reduction over 7 years for sealing An additional $16M over 7 years for reconstructing An additional $42M over 7 years for reconstruction
gravel roads, new kerb and gutter, resealing and and resurfacing roads and resurfacing
reconstruction of paved roads Average road condition continues to decline Road condition increases to ‘very good’ range in
Average road condition falls from ‘good’ to ‘fair’ for the next few years but then remains in the 10 years
within 10 years ‘good’ range
ENVIRONMENT & Reduced maintenance program for natural Sustainability Levy becomes part of rate base Sustainability Levy becomes part of rate base
SUSTAINABILITY vegetated areas including foreshore reserves Continuing projects include bushland rehabilitation Continuing projects include bushland rehabilitation
and bushfire protection. From 2014/15 reduced projects, lake water quality programs, foreshore projects, lake water quality programs, foreshore
environmental works including lake water quality rehabilitation projects rehabilitation projects
programs and foreshore rehabilitation projects,
saving $14.4M over 7 years
LIBRARIES & Reduced opening hours for all libraries. 2 library Maintain budget at current level, which will result $7.4M over 7 years to implement the Library
CULTURAL closures in 2013, saving $713,000, and 3 further in a gradual reduction in stock and service points Service Delivery Model including new libraries at
ACTIVITIES libraries close in 2014, saving $750,000 Morisset and Glendale
Total saving over 7 years of $8.6M Art Gallery extension
POOLS 1 pool will close in 2012, saving $3M over 7 years, Upgraded CPR and other equipment $20.4M over 7 years to upgrade pools
and 1 pool will be put under contract management, Pools not upgraded Redevelopment of Charlestown Pool and water
saving $3.9M over 7 years play zone at Speers Point
In 2013 a further pool will close, saving $2.4M
over 6 years
PARKS & Reduction of $536K over 7 years Funding and level of service maintained $0.8M over 7 years to improve park furniture
PLAYGROUNDS across City
New play equipment at Toronto foreshore at
$750K
FOOTWAYS & $4M reduction over 7 years for construction of Current levels maintained $3.5M over 7 years for construction of new
CYCLEWAYS new footpaths, cycleways, and traffic facilities footpaths and cycleways
COUNCIL STAFF Reduction of 123 Council staff across all areas, Increase in Ranger staff - increased patrols, Increase in Ranger staff - increased patrols,
saving $42.6M per year improved response times, improved public health, improved response times, improved public health,
The Economic Development Department would and environmental monitoring and enforcement and environmental monitoring and enforcement
be disbanded
DEVELOPMENT Longer turnaround times for DAs, reduced number Current levels maintained Current levels maintained
APPROVALS of planning studies, master plans, and area plans,
saving $0.4M per year
TOURISM Changes to tourism funding including closure of Current levels maintained Current levels maintained
the Visitor Information Centre at Swansea, saving
$3.8M over 7 years
TOWN CENTRE Funding not included Funding not included $7M over 7 years to implement a program to
UPGRADES upgrade town centres
NEW YOUTH AND Funding not included Funding not included New programs in partnership with relevant
ABORIGINAL organisations
PROGRAMS
IMPROVED Funding not included Funding not included $4.9M over 7 years for renovations, extensions,
COMMUNITY and construction works across the City
FACILITIES
FINANCIAL • Maintenance and infrastructure backlog • Maintenance and infrastructure backlog will be • Maintenance and infrastructure backlog
significantly increases partially addressed addressed
• Operating deficit continues with estimate of • Operating deficit until 2016/17 then expected • Operating deficit until 2016/17 then expected
$8.5M in 2018/19 surplus of up to $5M in 2018/19 surplus of up to $7M in 2018/19
• New capital expenditure of $240M over 7 years • New capital expenditure of $269M over 7 years • New capital expenditure of $326M over 7 years
• Replacement capital expenditure of $268M over • Replacement capital expenditure of $308M • Replacement capital expenditure of $344M
7 years over 7 years over 7 years
Important information about your Council rates and services 11

12. RESIDENTIAL RATES CALCULATOR
Option 1: Reduce Services – Maintain Rates
2011/12 2012/13 2013/14 2014/15 2015/16 2016/17 2017/18 2018/19 Cumulative
Increase on 3.00% 3.00% 0.34%* 3.00% 3.00% 3.00% 3.00%
Previous Year
Rateable Value Number of Land Value
Properties For Rates Calc
$0 to $99,999 6,803 $50,000 $587.87 $17.64 $18.17 $2.18 $18.77 $19.34 $19.92 $20.51 $116.53
$100,000 to $149,999 14,602 $125,000 $757.07 $22.71 $23.39 $2.81 $24.18 $24.90 $25.65 $26.42 $150.07
$150,000 to $199,999 22,367 $175,000 $869.88 $26.10 $26.88 $3.23 $27.78 $28.61 $29.47 $30.36 $172.43
$200,000 to $299,999 21,589 $250,000 $1,039.09 $31.17 $32.11 $3.86 $33.18 $34.18 $35.20 $36.26 $205.97
$300,000 to $499,999 6,909 $400,000 $1,377.50 $41.33 $42.56 $5.12 $43.99 $45.31 $46.67 $48.07 $273.05
$500,000 to $999,999 2,267 $750,000 $2,167.14 $65.01 $66.96 $8.05 $69.21 $71.28 $73.42 $75.63 $429.57
$1,000,000 to 254 $1,500,000 $3,859.21 $115.78 $119.25 $14.34 $123.24 $126.94 $130.75 $134.67 $764.97
$1,999,999
$2,000,000 27 $2,000,000 $4,987.26 $149.62 $154.11 $18.53 $159.27 $164.05 $168.97 $174.04 $988.58
and greater
Option 2: Maintain Services – Increase Rates
2011/12 2012/13 2013/14 2014/15 2015/16 2016/17 2017/18 2018/19 Cumulative
Increase on 9.75% 9.50% 6.00%* 5.50% 5.25% 4.75% 4.75%
Previous Year
Rateable Value Number of Land Value
Properties For Rates Calc
$0 to $99,999 6,803 $50,000 $587.87 $57.32 $61.29 $23.03 $40.12 $40.41 $38.48 $40.30 $300.95
$100,000 to $149,999 14,602 $125,000 $757.07 $73.81 $78.93 $29.66 $51.67 $52.04 $49.55 $51.91 $387.57
$150,000 to $199,999 22,367 $175,000 $869.88 $84.81 $90.70 $34.08 $59.37 $59.79 $56.93 $59.64 $445.32
$200,000 to $299,999 21,589 $250,000 $1,039.09 $101.31 $108.34 $40.71 $70.92 $71.42 $68.01 $71.24 $531.94
$300,000 to $499,999 6,909 $400,000 $1,377.50 $134.31 $143.62 $53.97 $94.02 $94.68 $90.16 $94.44 $705.19
$500,000 to $999,999 2,267 $750,000 $2,167.14 $211.30 $225.95 $84.90 $147.91 $148.95 $141.84 $148.58 $1,109.43
$1,000,000 to 254 $1,500,000 $3,859.21 $376.27 $402.37 $151.19 $263.40 $265.25 $252.59 $264.59 $1,975.67
$1,999,999
$2,000,000 27 $2,000,000 $4,987.26 $486.26 $519.98 $195.39 $340.39 $342.79 $326.42 $341.93 $2,553.16
and greater
Option 3: Improve Services – Increase Rates
2011/12 2012/13 2013/14 2014/15 2015/16 2016/17 2017/18 2018/19 Cumulative
Increase on 9.80% 9.70% 9.00%* 7.75% 7.25% 6.75% 4.75%
Previous Year
Rateable Value Number of Land Value
Properties For Rates Calc
$0 to $99,999 6,803 $50,000 $587.87 $57.61 $62.61 $43.76 $58.27 $58.73 $58.65 $44.06 $383.69
$100,000 to $149,999 14,602 $125,000 $757.07 $74.19 $80.63 $56.36 $75.04 $75.64 $75.53 $56.74 $494.12
$150,000 to $199,999 22,367 $175,000 $869.88 $85.25 $92.65 $64.75 $86.22 $86.91 $86.78 $65.19 $567.75
$200,000 to $299,999 21,589 $250,000 $1,039.09 $101.83 $110.67 $77.35 $102.99 $103.81 $103.66 $77.87 $678.19
$300,000 to $499,999 6,909 $400,000 $1,377.50 $135.00 $146.71 $102.54 $136.54 $137.63 $137.42 $103.23 $899.06
$500,000 to $999,999 2,267 $750,000 $2,167.14 $212.38 $230.81 $161.32 $214.80 $216.52 $216.20 $162.41 $1,414.44
$1,000,000 to 254 $1,500,000 $3,859.21 $378.20 $411.03 $287.27 $382.52 $385.57 $385.01 $289.22 $2,518.82
$1,999,999
$2,000,000 27 $2,000,000 $4,987.26 $488.75 $531.17 $371.24 $494.33 $498.27 $497.54 $373.76 $3,255.07
and greater
Business and farmland rates calculations for each option are also available.
Visit www.haveyoursaylakemac.com.au/securingourfuture or contact Council on 4921 0333.
The Cumulative column represents the total increase in rates payable over the 7-year period from 2011/12 to 2018/19.
12

13. HOW WILL A RATE INCREASE
AFFECT ME FINANCIALLY?
For residential ratepayers, with an average land value of $175,000, your
average yearly increase will be: Council offers a number of
Option 1: $24.63 per year or $0.47 per week options for ratepayers to tailor
their payments to manageable
Option 2: $63.61 per year or $1.22 per week amounts. For example, you can
arrange to pay in quarterly or
Option 3: $81.10 per year or $1.56 per week monthly instalments, and by
direct debit. Contact Council on
Residents can use the Residential Rates Calculator on the opposite page 4921 0333 if you wish to discuss
to work out what a potential rate increase will mean in terms of dollars. payment plans for your rates.
Residents and business owners can use the tables below to understand the
year-to-year increases on a percentage basis.
SUMMARY OF RATE INCREASES
Residential Option 1 Option 2 Option 3
2012/2013 3.00% 9.75% 9.80%
2013/2014 3.00% 9.50% 9.70%
2014/2015 0.34%* 6.00%* 9.00%*
2015/2016 3.00% 5.50% 7.75%
2016/2017 3.00% 5.25% 7.25%
2017/2018 3.00% 4.75% 6.75%
2018/2019 3.00% 4.75% 4.75%
Business Option 1 Option 2 Option 3
2012/2013 3.00% 14.00% 14.00%
2013/2014 3.00% 14.00% 14.00%
2014/2015 0.34%* 7.50%* 12.50%*
2015/2016 3.00% 6.00% 9.00%
2016/2017 3.00% 5.25% 7.50%
2017/2018 3.00% 4.75% 6.75%
2018/2019 3.00% 4.75% 4.75%
If IPART sets the rate peg higher than any approved rate increases for any year, then Council will adjust rates accordingly for
each option.
NOTES FOR TABLES: *In 2014/15 Council has an expiring special variation to general income that was granted for the
years 2010/11 to 2013/14 inclusive, for costs associated with environmental works as defined by Council in its special
variation 5 year works program. This special variation has come to be known as the Sustainability Levy.
The amount Council will be required to reduce its general income is $2,103,708 plus the equivalent cumulative proportion of
this increase from any general variation increases or special variation increases approved for the 2011/12 to 2013/14 rating
years inclusive. The reduced rate increase (0.34%) in 2014/15 for Option 1 reflects a reduction in environmental programs
and works after the Levy ceases. The estimated reduction in Council’s general income for each option in 2014/15 is as
follows: Option 1: $2,293,869; Option 2: $2,629,142; Option 3: $2,634,213.
As Council intends to continue with its environmental program, it is proposed to increase rate income in Options 2 and
3 for 2014/15 to enable these works to be funded. This increase in rate income is incorporated in percentage increases
for Options 2 and 3. The proposed percentage increase in rate income in 2014/15 that relates to the extension of the
environmental program is as follows: Option 2: 2.59% (which equates to an average of $29.05 per residential rate
assessment); Option 3: 2.59% (which equates to an average of $29.12 per residential rate assessment). See page 14 for
more information on the Levy.
Important information about your Council rates and services 13

14. SUSTAINABILITY LEVY
The local environment consistently rates as one of the What has been achieved with the Levy?
most important features of the City for residents. Access Key achievements include:
to the lake, coastline, and bushland provides people with an
opportunity to enhance health and wellbeing through outdoor • 26 on-ground works projects completed to improve lake
activity and enjoyment of our wildlife and natural places. water quality
• Clean Up Lake Macquarie collected 28 tonnes of rubbish
During development of the 10 Year Community Plan over 86 sites with 7,146 volunteers
in 2008, community feedback rated Caring for the
Environment as the most important of Council’s focus • Residents were assisted in saving money, including a
areas. The need for additional funds to deliver environmental 3.9% reduction in citywide electricity use in 2009-2010,
programs was identified, as the previous Lake Levy which and an overall saving to the community of $6M through
had been in place for 10 years was due to expire. access to rebates and other programs
• Award winning climate change adaptation program
Council sought and was granted a special variation, which delivered, including the E-shorance web tool to assess
has come to be known as the Sustainability Levy. It was the response of the lake foreshore to predicted sea
introduced in 2009 to fund environmental projects, including level rise
continuation of lake water quality improvement works. The
Levy expires in 2014. • Inaugural Living Smart Festival attracted 8,000 people
• Waste to landfill reduced by 23% per capita, and
What happens under each funding option commercial recycling increased by 38%
when the Levy finishes in 2014? • 18 sustainable neighbourhood groups established
All three funding options include the Sustainability Levy in
2012-2014. As Council intends to continue with its Caring What is planned for the next 7 years?
for the Environment programs, it proposes to increase rate In the next 7 years we intend to continue work to:
income across the 7-year period to enable these works • Maintain and improve lake water quality through
to continue beyond 2014. This increase in rate income is construction and maintenance of over 70 on-ground
incorporated in Options 2 and 3, but not in Option 1. works projects
Under Option 1, the Levy funding for environmental works • Complete over 20 works projects to reduce energy and
and programs stops in 2014/15. This will also be the case water consumption in Council and community facilities.
if Council’s application for a rate increase is not approved • Develop local area adaptation plans for all foreshore
by IPART. areas affected by flooding and sea level rise
Under Options 2 and 3, rate increases for the 7-year • Expand our sustainable neighbourhoods program to
period will provide additional income to continue Council’s provide an opportunity for neighbourhoods in the City to
current environmental programs beyond 2014. The expiring work with Council to improve their local environment
variation becomes part of the general rate base beyond • Continue to support residents and businesses to save
2014/15. money at home and at work through programs to reduce
waste generation and resource consumption
HOW DO WE KNOW Council currently reports on its performance quarterly,
as well as in our annual report, which is provided to
COUNCIL IS DOING the community. Council’s performance reporting will be
increased to ensure that the community can easily track
A GOOD JOB? Council’s delivery of programs identified as part of any
special rate variation.
The Local Government Act 1993 requires local councils Lake Macquarie City Council has a strong track record of
to demonstrate they are meeting the needs of their productivity improvements that have been achieved over the
communities in an effective and efficient way. last 10 years. We recognise that continuous improvement
Our 10 Year Community Plan outlines targets and other and innovation is an ongoing process. Council is committed
measures by which actual levels of service provision to getting the very best value for money and outcomes for
can be assessed. our community. We will continue to explore and adopt best
practice and seek out innovative ways of delivering services.
14

15. FREQUENTLY ASKED QUESTIONS
What is a Special Rate Variation? deliver the same, or improved, levels of service to our
Since 4 June 2010, the Independent Pricing and community. The rate peg has consistently been set below
Regulatory Tribunal (IPART) has been responsible for cost increases.
setting a maximum percentage by which councils can If funding is not obtained to cover the operating deficit,
increase rates. This is known as the rate cap or rate peg, there will need to be a significant reduction in expenditure
and is usually around 3%. Prior to 2010, the rate peg was to contain costs, which will result in reduced services to
set by the Minister for Local Government. the community.
Councils can request a special rate variation to increase
rates above the rate peg. Councils must undertake How has Council sustained a balanced
extensive community consultation and make an application budget without increasing rates up
to IPART if they wish to seek a special rate variation. until now?
IPART makes the final decision on whether the rate Council has used our asset replacement and other
increase is allowed. reserves to balance the budget. This practice is not
sustainable. Our assets continue to age, and depreciation
What are the proposed rate continues to increase, our reserves are being eroded to
increase options? meet the budget shortfall.
Council has put forward three funding options for the
community to consider. How much money will Council be
spending on upgrading and replacing
Option 1: Reduce Services – Maintain Rates assets across the City?
Option 2: Maintain Services – Increase Rates To ensure sufficient funds are provided for the replacement
and upgrade of assets such as roads, community
Option 3: Improve Services – Increase Rates buildings, boat ramps, and jetties, Council sets aside an
amount of money each year. This amount is a percentage
Each of these rate increase options is explained in detail of the total money required to ensure specific assets
on pages 6-13. reach their full life cycle. This is known as cash funding
depreciation.
What happens after 7 years? Each of the three funding options includes different
After 7 years, rates will realign with the rate peg amount amounts of funds set aside for the replacement and
determined by IPART. maintenance of assets.
Under Option 1, cash funding of depreciation commences
Why is Council looking to increase rates? at 53% after year 1 and increases to only 67% after 7
Council faces some financial challenges and cannot years, while Option 2 commences at 61% after year 1 and
continue to provide existing levels of service to the increases to 87% after 7 years. Option 3 provides the most
community with our current funding levels. satisfactory outcome to ensure appropriate management
and replacement of our asset base by commencing at
Careful financial management has enabled Council 57% after year 1, and increasing to over 90% cash funding
to consistently maintain an operating surplus, where of the annual depreciation charge by year 7.
our operational income has exceeded our operational
expenditure. This surplus has been used to offset What happens if Council’s application for
infrastructure costs and for principal loan repayments.
a rate increase is unsuccessful?
Unfortunately, rate pegging continues to affect our ability
If IPART does not approve Council’s application to increase
to achieve a surplus. In fact, we are now forecasting a
rates, this will mean that rates will continue to increase
significant operating deficit in the 2011/12 financial year
by only the rate peg amount (3%). Council will have to
and future years.
consider cuts to services to correct budget shortfalls and
Other factors affecting our operating result include the ensure financial sustainability, as outlined on pages 6-7.
impact of cost shifting. This is where the costs of other
levels of government are passed on to local government. When will rates rise?
Cost shifting currently amounts to over $15.5M per year
If a rate increase application is successful, rates will
for Lake Macquarie City Council. In addition to the burden
increase from 1 July 2012.
of cost shifting, recently there have been significant
increases in other government levies such as the Rural Fire
Services Levy. How can I get more information?
Visit www.haveyoursaylakemac.com.au/
Like all other businesses and households, we also have
securingourfuture
to budget for increased utility and fuel costs, as well as
increases in the costs of materials. Such price increases
have a significant impact on our ability to continue to
Important information about your Council rates and services 15

16. HAVE YOUR SAY ON SECURING OUR FUTURE
Which option do you prefer? Attend a Securing our Future
Community Workshop in your area
Option 1: Reduce Services – Maintain Rates
Wed 9 Nov Belmont 16 Footers
Option 2: Maintain Services – Increase Rates 12pm – 2pm The Parade, Belmont
Thur 10 Nov The Place
Option 3: Improve Services – Increase Rates 5.30pm – 7.30pm Charlestown Community Centre,
Charlestown Square,
81/30 Pearson Street, Charlestown
Sun 13 Nov Toronto Diggers
There are many ways 2pm – 4pm 41 The Boulevarde, Toronto
to tell us your preferred option Tues 15 Nov Council Administrative Centre
You can either: 12pm – 2pm 126-138 Main Road,
6pm – 8pm Speers Point
• Complete our online poll at
www.haveyoursaylakemac.com.au/ Sun 20 Nov Cameron Park Community Centre
securingourfuture 2pm – 4pm 107 Northlakes Drive, Cameron Park
Tues 22 Nov Morisset Country Club
• Attend one of our community workshops
5.30pm – 7.30pm Dora Street, Morisset
or
• Complete the funding option selection form below and Find out more online:
drop it off at your local library or post it in an envelope. If Visit www.haveyoursaylakemac.com.au/
addressed as shown on the form, no stamp is required. securingourfuture to find out more and:
• Read our information sheets and frequently
Stay up to date asked questions
Like us on Facebook • Take part in online discussions
www.facebook.com/lakemaccity • Try your hand at setting Council’s budget using our online
or budget allocator
follow us on Twitter
www.twitter.com/lakemac • Find out what other residents are saying about rates and
Council services
SECURING OUR FUTURE
FUNDING OPTION SELECTION FORM
Age: Gender: Male Female Postcode:
Which funding option provides the most appropriate level of service? (please tick)
Option 1: or Option 2: or Option 3:
Any comments?
Which funding option do you prefer? (please tick)
Option 1: or Option 2: or Option 3:
Any comments?
Please post your completed form in an envelope.
No postage stamp is required if addressed as follows: Securing Our Future Project
Lake Macquarie City Council
Reply Paid 67121
HRMC NSW 2310