Litchfield Council has admitted that after dramatically dropping the cost to Southport residents for sealing six streets, it does not know how the revised figure was calculated.
Residents say they were not told there was going to be a charge until after the streets were bituminised.
The revelation about costs levied by the council is said to have occurred at a meeting where the mayor admitted residents were not told until after the work had been done.
One resident, Barry Moriarty, who is a Southport Progress Association committee member, said Litchfield Council was charging the owners of 71 residential blocks in the small hamlet, about 60km southeast of Darwin, $3801.79 per block for sealing or partially sealing a total of 2.32km in six streets.
The partially sealed thoroughfares are Aldridge, Ringwood, Riverside, Collett, Cheery and Barrow Streets.
The levy was reduced from $5641 per block, which the council was originally going to charge.
Residents said they were given details more than a year after being advised that the work would be done and after the work had been completed. Before that, they had not been told it would cost them anything.
Some residents who had no street frontage on the sealed roads were also charged, a situation mayor Doug Barden told the July council meeting had been rectified.
The council’s own rates policy states that properties on intersections will only be charged once rather than once for each road.
The federal government granted the council $2,366,858 for the work.
“There was no community consultation with regards to the road upgrade, as they are supposed to do,” Mr Moriarty said.
“The mayor has admitted in recorded council meetings that the consultation was poor, and we were not advised prior to the works beginning of a charge. We have asked the question as to when any consultation was done. He is unable to answer.”
What consultation was undertaken
Mr Moriarty said the first notice to residents of the intent to seal streets came when mayor Barden attended a Southport Progress Association meeting early last year to get feedback from residents about the council’s plan to do so, but Mr Moriarty said Mr Barden did not mention that they would be paying for it.
A letter from the council dated March 15, 2023, seen by the NT Independent, which Mr Moriarty said was the first official notification from the council, tells residents the streets were going to be sealed on the basis of federal government funding being secured, with work to begin in May.
It made no mention of any cost to residents.
A further letter from the council dated April 4, 2024 said a road sealing levy of $5641 per block with a two-year interest-free period would be approved as part of the draft municipal plan for the streets that had then recently been sealed.
Southport resident Marcus Schmidt asked at the April 16 council meeting why there was no consultation with impacted residents prior to the roadwork commencing.
The minutes for the meeting record that his question was not answered.
“The current consultation period for Southport roads will provide an opportunity for feedback,” the minutes record.
“The council will consider this feedback as it has with any previous feedback on the sealing of roads and special rates. Previous communication with Southport residents provided by Litchfield Council has related to the specific road sealing project delivery details.”
The minutes from the May meeting record that residents Karl and Anne Schmidt asked in a letter why ratepayers were not consulted or advised that they would have to pay a special rate before the road was sealed, saying the were not informed of this in 2023, and cited Mr Barden’s silence on the matter in the April 16 meeting when he was asked about consultation.
“There was consultation about the project and the work but not specifically a special rate levy,” they said.
The council has videos of its August, July, and June meetings on YouTube but earlier meetings have been deleted and minutes do not record exactly what councillors say at meetings.
The Schmidts also asked at which meeting councillors approved imposing a special rate for the work.
In response to their questions, the minutes noted: “Writers were not present at the meeting, a response will be forwarded to the person asking the question in writing following the meeting.”
The minutes for the May meeting record Mr Moriarty’s concerns that “perfectly good” bitumen streets were being resealed with grant money to use it up, and that residents fronting those streets were not paying any levy for it.
He said there needed to be a review of the cost per metre charge for the Southport street sealing, and into the fact that he had raised the matter of proposed levy charges and was not provided with any information.
“Question taken on Notice, Council will consider the concerns during the 2024/2025 Municipal Plan Process,” was minuted.
They further record that Marcus Schmidt told the meeting: “it seems unlikely that council has correctly followed procedures in the Local Government Act in relation to special rates.”
The minutes show the proposed municipal plan with the $3801.79 per block levy was adopted at that meeting.
Litchfield Council chief executive officer Stephen Hoyne said in a statement to the NT Independent that the decision to seal the streets was informed by its sealing of roads policy, which prioritises road sealing projects based on factors such as public benefit, safety and the availability of funding.
He said council engaged with Southport residents as part of standard procedure under the Local Government Act and had published notices inviting submissions and feedback on the draft municipal plan, which included the road sealing and proposed levy.
Mr Hoyne would not specify the nature of the consultation nor when residents were first told about the charge.
“During the consultation period, we received and considered multiple submissions from residents, which were duly reviewed by council before finalising the plan,” he said.
“Residents were informed about the potential for a special rate levy to be imposed to help defray the costs of sealing…This was in line with Section 238 of the Local Government Act, which permits council to declare special rates for such projects where there is a public benefit.”
How the cost was arrived at
Residents say that the initial $5641cost per block was applied equally to small landholders and those with 200 acres and longer street frontage because it had been calculated as a flat rate per property.
Mr Moriarty said that meant the cost was about $24 a metre for five-acre blocks, but even at the reduced price, Southport residents were being charged about $111 per metre.
He said a group of residents were at the June council meeting to hear the outcome of their written objections. They were told the new charge was based on a calculation from 2015 with CPI added.
“That figure is flawed because that was the charge for rural blocks, which are mostly five acres and above and having over 100 metres of frontage,” Mr Moriarty said.
“The Southport blocks are only 30 metres long. I think most of us would be happy to pay something that is comparative to what others on larger blocks would pay.”
Minutes from the July council meeting state that in response to a question by Mr Moriarty at the June council meeting, “Mayor Barden confirmed that the original calculation was set by a previous council and that it was unknown, however the processes of applying a road seal levy has been confirmed through legal advice”.
Mr Hoyne said in a statement to the NT Independent the council reduced the levy the residents would be charged for the work after considering submissions from residents and further reviewing the matter.
The levy was then adjusted to $3801.79, which was calculated based on a base rate established in 2013 and indexed to 2023 by CPI.
Council did not know how the 2013 figure was arrived at.
“The policy ensures that ratepayers are not charged the full cost recovery, unlike in many interstate councils,” Mr Hoyne said.
“While it’s been noted in council documents that the current council does not have the original calculation method used to establish the $3000/property (in 2013), we applied the levy in line with established local government practices and note that this rate represents a subsidy to actual costs in the order of 90 per cent.
“In this case, council’s application of a reduced rate for Southport was determined to represent a fair outcome.”
Asked what he meant by the levy being applied in line with established local government practices given that council admitted it did not know what the calculations were based on, he said it related to the principle of applying a levy and was not intended to suggest there was a universally accepted formula for calculating levies.
“In this instance council referenced a benchmarked amount from 2013 whilst being mindful of the actual construction costs and an appropriate level of subsidy,” Mr Hoyne said.
“It should also be mentioned that property owners have two years to pay the levy and that anyone suffering financial hardship may apply for delayed payment terms.”
Video of the July meeting shows that mayor Barden told Mr Moriarty, who was present, that the new figure came from the amount residents of Kersley Street in Southport were charged in 2016, but with CPI added.
He said the original calculation for the Kersley Street residents was contained in a confidential briefing paper from May 11, 2016, which he sent to all councillors.
He was asked by Mr Moriarty what the original calculation was based on.
“We don’t know,” Mr Bardon said.
Division 1 of the Local Government Act 2019 specifies that a council must be able to “state the basis of the special rates”.
Frank ownership of decisions made today that, in part, answer to and correct bad governance of the past while still delivering projects and improvements to residents is a good indication of why this same council should be returned at the next election.