The impact of the coronavirus has extended the projected operating deficit of Lake Macquarie council's next budget to almost $11.5 million.
The council approved a revised $394 million budget and operational plan for 2020/21 at its ordinary meeting on Monday night.
It features a $115 million works program, including $45 million for new assets and $70 million for upgrades.
But the council is now forecasting an operating deficit of $11.5 million, up from $8.4 million outlined in the draft budget put on exhibition in April.
The increase is the result of various changes made to the budget due to the impact of COVID-19.
Staff identified a reduction in projected revenue of $1.9 million across multiple areas of council and a projected decrease in development contributions revenue of $4.7 million.
The council expects development to slow in the year based on recent activity, will suffer a hit from the commercial rents it waived as part of a revised hardship policy, and will lose revenue because its swim centres are set to have reduced capacity.
But the council was forecasting a loss for 2020/21 even before the coronavirus outbreak, as well as for the following two years.
It recorded an operating deficit of $9.9 million last year.
"While COVID-19 impacts are currently resulting in a greater than projected operating loss, current modelling shows the long-term financial plan returning to an operating surplus within three years," council staff said in a report prepared for the meeting.
No councillor commented on the draft budget when it was approved for exhibition in April and it was similar silence when the revised budget was passed with a unanimous vote on Monday.
The council's employee costs are expected to top $100 million in 2020/21, up from $92 million this year.
Total revenue is expected to rise about $5 million to hit $296 million, of which $140 million will be from rates.
The base residential rate, which makes up half of the rate notice, will rise to $747 from $730. The average rate in Lake Macquarie will be $1946, comprising rates of $1495 and a $451 waste levy.
Works expenditure increased by $10 million from the draft budget mainly as a result of a deferred spend.
In the next year, the council will invest more than $70 million on roads, drains, footpaths and shared pathways, including the completion of key cycleways at Glendale and Brightwaters.
Close to $20 million will be invested in new or improved parks, playgrounds, sporting facilities and swim centres.
About 30,000 native plants will be planted in Swansea, Blacksmiths, Caves Beach and Catherine Hill Bay.
"There are a number of highlights and actions outlined in the plan that will provide a significant boost to the local economy, as well continuing to protect our lifestyle and deliver the day-to-day services and facilities we all value," CEO Morven Cameron said in a statement.
Lake Macquarie mayor Kay Fraser, who was absent from Monday night's meeting, said the plan would keep the city's economy moving.
"This is a really important plan, more so than in previous years, as it sets out the direction for our recovery beyond COVID-19," she said.
"We know many people and businesses have been doing it tough, so it is critical for council to implement a robust plan that helps increase employment options and provides a kickstart to our local economy."
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