The heads of Newcastle business associations are calling for council to scrap the special rate imposed on commercial ratepayers in the city's retail precincts.
Subscribe now for unlimited access.
$0/
(min cost $0)
or signup to continue reading
Tuesday's council meeting will consider changes to how the special business rate is managed into the future.
Business improvement associations (BIAs), including Newcastle Now and Hamilton Chamber of Commerce, believe council's proposal will maintain a financial burden on commercial ratepayers while diminishing businesses' say in how the $1.3 million is spent.
Previously, money raised through the special rate went to business chambers operating in commercial precincts. However, council is now looking to enter revised deals with Newcastle's four existing associations in Wallsend, Newcastle CBD, Hamilton and New Lambton.
Council has put forward a plan, based on recommendations by consultants from AECOM, to open up the majority of funding to competition and making it available to any project that promotes, beautifies or develops those commercial areas.
"Some of the BIAs have struggled to maximise the return on the funds they have been provided," said City of Newcastle CEO Jeremy Bath of the proposal. "Competition is what is now needed to bring about fresh ideas for how this money is best invested in the activation of these areas."
The heads of Newcastle, Hamilton, New Lambton and Mayfield's business associations gathered in Hunter Street Mall on Monday to oppose the plan, saying council's "micro-management" of the funding would limit businesses' say in what projects go ahead, as well as discourage associations from criticising council for fear of losing tenders.
"Businesses have lost confidence in the city's management," Nathan Errington, the president of the Hamilton Chamber of Commerce, said. "If council wishes to continue on this path and endorse the sub-standard report up for consideration, then we urge the future programs be funded by the $53 million raised from businesses via the commercial rate."
Mr Errington said 80 per cent of 200 business owners who responded to a survey he conducted last week in areas affected by the special rate said they could no longer afford to pay it on top of the council's standard commercial rate.
Chair of Newcastle Now, Edward Duc, said the money to develop, beautify and promote retail areas should just be taken out of the council's commercial rate.
"If they can establish a BIA in The Junction using the commercial rate, why can't council do that across Newcastle?" he said.
Newcastle Now would be the group impacted most by council's proposed changes.
The council projects the special rate imposed on commercial ratepayers in the CBD will amount to $872,000 in the 2019-2020 financial year, of which Newcastle Now would only receive $100,000 in guaranteed funding.
Council terminated its deed of arrangement with Newcastle Now last December, after Mr Bath said an external investigation into the arrangement revealed several breaches by Newcastle Now.
David McElwaine, the owner manager of David McElwaine's Gentleman's Outfitters on Hunter Street, would support a reduction in rates, saying one reason shopfronts were empty in the city was that "rates had been pushed too high".
Related stories:
