How are rates calculated?
Rates are based on two variables, the rate in the dollar and the valuation of your property.
The formula for calculating rates is:
- Capital Improved Value (CIV) x Rate in the dollar = Rate payable
- CIV of the residential property = $A
- Rate in the dollar for residential properties = B cents
- A x B = $Rates
The ‘rate in the dollar’ is determined by calculating the total amount of rate revenue we require to maintain our services. We then divide this amount by the total value of the properties within the Frankston City Municipality (this amount changes every year).
It is a requirement of State Government that Councils use the below values to determine how much each property pays in Rates:
- multiply the value of your property by the 'rate in the dollar'
- add the Municipal charge, Fire Services Property Levy and Landfill Levy
- add the cost of any Waste Services
- subtract any Concessions (if eligible)
Property owners with lower-valued properties pay less in rates than owners of higher-valued properties however the rate is capped at 2.00% for 2020-2021.
If you own multiple properties in various municipalities, you may be wondering why some rates are less than others. This is because every Council has different budget requirements for capital works, proposed works and ongoing costs to maintain services across the municipality.
Please be aware that when you receive your rates notice, it is important NOT to add your capital improved value (CIV) and site value (SV) together as this is not how rates are calculated.
Why didn’t Council lower rates instead?
Each year, Council delivers more than 150 services to our community which are funded through the Council Budget. Council rates fund the local essential services and infrastructure which benefits the whole community. This includes but is not limited to:
- Aged and disability services
- Arts, culture, community centres and libraries
- Child, youth and family Care
- Community buildings
- Community grants
- Drainage and local roads
- Economic and business development initiatives
- Events and festivals
- Capital works, including new infrastructure, maintenance and redevelopment.
Why did Council raise rates? Are Frankston City Council rates in line with other Councils?
Every Council has different budget requirements for capital works, proposed works and ongoing costs to maintain services across the municipality.
The annual rates revaluation may have an effect on the overall percentage increase of your rates. This is due to either an increase or decrease in your property valuation when compared to the overall average increase of the municipality.
If your property valuation increased and was greater than the municipal average then your rates may increase to a greater amount than the Rate Cap percentage, which is 2.0% for 2020-2021. However, if your property valuation decreased, then your overall Rates may be equal to the Rate Cap percentage.
It’s also important to note that Rate Capping only applies to the General Rate and the Municipal Charge. The Rate Cap does not apply to other charges such as Waste Bins.
What is Rate Capping?
Rate Capping was introduced by the State Government on 1st July 2016 which Council has complied with. Rate Capping limits the amount Councils may increase rates in a year, without seeking additional approvals. The Rate cap for 2021-2022 will be 1.5%. In comparison, the previous Rate Caps (based on CPI) have been:
- 2017-2018 2.00%
- 2018-2019 2.25%
- 2019-2020 2.5%
- 2020-2021 2.00%
- 2021-2022 1.5%
What if I can’t pay my rates?
If you are having difficulty paying your rates, there are options to help such as our Hardship Relief Waiver. Please contact our friendly team on 1300 322 322 or visit our website for more information.