Central Otago District Council (CODC) has launched a high stakes review of its rating system, with its chief financial officer warning councillors they have “one chance” to get it right.

At the final council meeting of the year on Wednesday (December 17), councillors authorised staff to begin modelling different scenarios for how rates could be collected across the district. 

Chief financial officer Paul Morris told elected members the process carried significant risk if not handled carefully.

"You get one chance to do it and maintain credibility around it," Paul said. 

"It's got to be thought through and the decisions that come out of it will have to be well documented, making sure the affected parties are well informed about what we're proposing and why we’re proposing it." 

He cautioned against incremental changes without a clear plan, saying other councils had "tried this over a period of time” and made systems “progressively worse” with each attempt. 

Paul said the council would need to "cross your t’s and dot your i's" to ensure strict legislative compliance to "close down the opportunities for challenge", warning rates could be legally contested if they did not strictly follow the law. 

The review aims to address imbalances created by recent significant rate increases, the move to a district wide funding model and the pending transfer of water services. 

A report presented by Paul said the current rating system had not been reviewed for "many years" and it was time to "review and redesign, if appropriate". 

The report also signalled a possible reset for some sectors, saying the process would allow the council to propose new rates for industries “currently not covered adequately". 

Deputy mayor Tracy Paterson asked whether the council could go through the full review process and ultimately decide to change nothing. 

Paul said that outcome remained a possible. 

"We could end up back where we started, but at least we would have gone through a rigorous process to say ‘yes, we're happy with that’," he said.  

"You don't know what's available and what you might like to do…it's a matter of going through that process and ascertaining whether you think that is equitable or not." 

Teviot Valley councillor Curtis Pannett said early engagement with the community would be important. 

Mayor Tamah Alley rejected suggestions to "pick away" at the issue, saying a comprehensive review was needed. 

She said any changes would likely be implemented in 2027, by which time the council would have "no three waters coming out" and a "strong indication from the government" regarding a potential rates cap. 

Funding for the review has already been allocated in council budgets.  

Staff will now begin work on the proposal, with the aim to have it ready for public feedback by June.