REGION - Ararat region farmers have joined with the Victorian Farmers' Federation in welcoming the Victorian Government's release of draft differential rate guidelines.
The guidelines, released for consultation last week, have been introduced to help local councils set municipal rates.
Ararat Rural City Council's differential rating system caused a furore in the farming community last year.
Council adopted a Farm Differential Rate of 52.5 percent of the general rate and a municipal charge of $80, despite more than 30 submissions received from the rural community accusing council of reneging on a decision made in 2010, which would have seen the farm differential rate reduced further in 2012 to 45 per cent of the general rate.
Liberal Member for Western Victoria Simon Ramsay invited all ratepayers, Councils and other interested organisations to participate in the state-wide consultation process.
"The Local Government Act 1989 previously provided Councils with insufficient guidance regarding the application of differential rates," Mr Ramsay said.
"Councils could levy differential rates as long as the highest rate was not more than four times the lowest, was calculated using the capital-improved-value, and contributed to the Council's efficient and effective operation.
"There's been a significant increase in the use of differential rates and in the inconsistency of their application, raising a number of community concerns.
"As a result, I think it's important to establish consistent principles to guide Councils in their use.
"A number of farmers across Victoria have expressed concerns regarding the importance of differential farm rates, so the consultation paper specifically seeks community feedback on whether Councils should be required to use reduced farm land rates."
Mr Ramsay said the Victorian Coalition Government last year amended the Local Government Act 1989 to allow the Minister for Local Government to set differential rating guidelines, and empower the Minister to seek an Order in Council to prevent the application of inconsistent differential rates.
The Victorian Farmers' Federation believes current municipal rates and differentials set by many local governments place an unfair financial burden on the farming community.
"The rating system is based on the value of land and its improvements. This means farmers are paying 46 per cent of regional Victoria's rates assessed on business despite only making up 12 per cent of the regional economy," VFF president Peter Tuohey said.
The VFF believes that there should be a mandatory lower differential for farmers to recognise the capacity to pay and create equity in the local government funding system.
"All councils should offer farmers lower differentials on their rates, in recognition that land values don't reflect your income earning capacity," Mr Tuohey said.
"Victorian farmers pay an average of $8,500 in municipal rates which is much higher than the $1,000 of residential rate payers in regional areas. That's why we need a lower differential."
Mr Tuohey visited Ararat last year and urged the farming community to join the fight against rising rates.
Ararat/Tatyoon VFF branch president Noel Barr said the branch welcomed the review.
"We want people to contact the VFF and say whether they want to keep the differential or have guidelines so that it can be used in a better way," he said.
Differential guidelines are only a small portion of the issues affecting local rates, and the VFF has a petition running calling on the government to conduct a comprehensive inquiry into local government funding.
The petition can be found at www.vff.org.au along with a fact sheet explaining how the rating system is affecting farmers across the region.
The VFF will be providing a detailed submission to the draft and encourages all farmers to attend a regional meeting and have their voice heard.
Meetings closest to Ararat include those at Hamilton on Monday February 11 from 10am - 12pm at the Hamilton Performing Arts Centre, Ted Kenna Room, 113 Brown Street, Hamilton, and in Ballarat on Monday February 11 from 3.30pm - 5.30pm in the Ballarat Town Hall, Trench Room, 222 Sturt Street, Ballarat
Details of the regional meetings and a copy of the government's guidelines are available at http://www.dpcd.vic.gov.au/localgovernment/projects-and-programs/differential-rates-guidelines