A recovery rate to pay for the damage caused by Cyclone Gabrielle will be attached to Hastings ratepayers’ bills for the next 16 years.

This year, as well as the recovery rate, ratepayers will have a new targeted post-cyclone rate of $58 per property to strengthen emergency management capability.

Overall, Hastings District Council (HDC) is proposing a 5.9% rate increase for the year, down from the 10% increase in its long-term plan.

The cyclone, which devastated the region on February 14, 2023, swept away bridges and infrastructure and flooded homes, leaving the council with recovery costs estimated to be around $1 billion.

The Government contributed 50% of the post-cyclone property buy-out scheme, funded the removal of millions of cubic metres of silt from properties, and gave a further $197 million towards specific transport projects and programmes.

Two years on, HDC faced a $230m recovery bill.

Mayor Wendy Schollum said the council had worked hard to reduce rates and its borrowing.

“We know households are under pressure and a rate increase of any size has an impact. Bringing the forecast 10% down to 5.9% reflects careful financial management and focused work,” she said.

Schollum said a major contributor to the lower figure was committing to complete major cyclone-damaged bridge and culvert rebuilds within the next three years.

That secured 100% of the funding for most of those rebuilds and reduced the council’s share of the cyclone cost to $182m, which in turn had reduced the cyclone-targeted rate in the district by $3.4m, a 2.1% reduction in overall rates.

Schollum said the council had also saved $3m by improving day-to-day operations, not replacing some staff, using fewer external consultants, and adjusting the wider roading programme.

Regan Munro says 16 years to pay off cyclone recovery is too long.

Regan Munro, a car salesman who owns two properties in the district, said he’d had enough of rising rates, and would be selling his rental property in September.

Rates rose in Hastings by 8.7% in 2023, 19% in 2024, and 15% in 2025.

“I can’t keep telling my tenant their rent is going up because the rates have gone up. It’s just not fair to them,” Munro said.

He said he worried the cyclone recovery fee sitting on his rates bills for the next 16 years would impede progress, and he felt the council should try to find other ways to pay for the recovery.

“All the new housing being built, particularly in Havelock North and Flaxmere, will mean more ratepayers.

“Surely that equals more money, and therefore the debt should be paid off quicker?”

The council said its budget was not set on property numbers.

“A budget is set for the cost of work to be done, and then shared out among the number of properties in the district,” a spokesperson said.

“Each year, through long-term plan and annual plan processes, council reviews the targeted rate which could be impacted by, for example, interest rates reducing or increasing, the total required, and/or considerably increased number of properties to share the cost.”

Schollum said if the council shortened the timeframe the targeted rate would need to rise.

“We will be reviewing all the costs associated with the recovery as part of our considerations during this year’s annual plan process.

“It’s worth noting that much of this work, such as the bridges, is expected to last 100 years, so many generations will get the benefit of this.”

A council spokesperson said it adopted a “we are all in it together principle” to share the cost, with the cyclone recovery fee split in two.

The first 50% was a fixed uniform charge on every property, while the other 50% was based on a percentage of land value.

“This ensures those in the rural areas who benefit more from the work contribute slightly more, and those with lower-value homes pay a smaller share.

“Six per cent of the 24/25 15% rate increase is the second and last step of introducing a targeted rate, which is now set at a stable level to fund the cyclone recovery over a further 15 years.

“Sticking to the financial strategy gives us the best chance of maintaining our financial credit rating. This keeps the cost of council borrowing as low as possible, which is critically important as we enter a period of increased borrowing.”

The spokesperson said the draft annual plan improved the council’s unbalanced budget position from $8.4 million to $4.8 million, with a return to a balanced budget forecast in 2027/28.

Munro said it felt as if the council was putting its hand out all the time, and he wanted it to be more prudent with its spending.

Rates in the rest of Hawke’s Bay

In Central Hawke’s Bay, the district’s projected average rates increase proposed for 2026-27 is 7.7%.

Again, cyclone recovery is cited as a key reason for the increase.

Central Hawke’s Bay District Council chief executive Doug Tate said it would receive its first update of the annual plan this week.

“The main drivers for the projected rates increase are recovery from Cyclone Gabrielle, the ongoing deliberate shift from the use of debt to rates funding for water renewals and focused critical Three Waters upgrades.

“The draft increase is down from 10.9% as projected in the Three-Year Plan ‘Road to Recovery’.”

He said the council would receive further updates and options on the annual plan in the coming months, ahead of its budget, which would be signed off by June 30.

In Wairoa, the forecasted rates increase, set two years ago in the 2024-27 long-term plan, is 9.97%.

For Napier ratepayers, the proposed increase is 9.1%.

Hawke’s Bay Regional Council said it was considering an average rates increase of less than 5% for 2026–27, down from the 8.5% rise projected in its long-term plan, though it had not confirmed a specific figure.

It would adopt its annual plan and set its rates in June.

LDR is local body journalism co-funded by RNZ and NZ On Air.