Council will refund about $7 million in canal levies due to problems with the way the collection process was set up

Council to repay about $7 million in fees to canal residents

A TECHNICAL blunder by Redland City Council has forced it to return about $7 million from a special levy which was collected to do dredging, maintenance and repair work on canal and lake estates.

When the levy was set up in 2011, no end point or dollar projection on the total monies to be collected were defined.

A week ago this was found not to meet state legislative requirements.

Letters will go out next week to all 1200 properties at Raby Bay, Aquatic Paradise and Sovereign Waters who paid the levy.

Money remaining in this special fund will be returned although sums to individual residents will vary according to how much they have put in.

Council used to pay 30 per cent of the maintenance bill on those estates based on the premise that parts of these places are used by the public. This input was cut to 20 per cent in the last budget.

Council chief executive Bill Lyon said there was about $9 million in the canal reserve, of which 20 per cent to 30 per cent was put in by council and would not be part of the refund.

Special charges would be temporarily ended while money was returned and a new process developed.

Mr Lyon said the fund tended to rise and fall, depending on what work was being done on canals.

Scheduled jobs already under way like revetment work on two canals and maintenance dredging would continue.

Mr Lyon said the problem had been found during a review.

“Following this review we believe it is only proper that we take this course of action,’’ Mr Lyon said. “This is the result of a technical drafting error and once it was detected council has moved quickly and proactively to rectify it.

“Council has received no direction to take this action. We are doing it ... to maintain our standard of accountability.’’

Mr Lyon said an independent accountant had been hired to sort the issue out as a priority.

“Council is open and transparent and we are investing a great deal of time to ensure we get this right,’’ he said.

After the matter was resolved council would consult with residents about any new set-up.

“This decision does not affect services or funding for other areas of the city, as the money being refunded was collected from canal homeowners and quarantined specifically for work on canals, such as dredging, cleaning and, at Raby Bay, repairs to revetment walls,’’ he said.

A special charge might be introduced in 2017-18 dependent on budget deliberations.

“In the meantime, council and the community have an opportunity to revisit the issue of canal maintenance and revetment wall repairs and to develop an appropriate strategy,’’ he said.

“However, council maintains its position that the maintenance of our canals should be predominantly funded by those who own property on them.’’

A review of the city’s other special benefit levies showed they met legislative requirements.