Mayor Stephen Hart said borrowing more money would be irresponsible.
COLAC Otway Shire councillors have approved the council’s 2012-13 budget despite concerns about its rising debt.
Councillors voted 4-3 to adopt the budget, which imposes an average rate rise of 6.33 per cent.
The council will borrow an extra $1.5 million over 15 years to pay for a roof over Colac’s saleyards, increasing its debt from $4.2 million to $5.26 million.
Mayor Stephen Hart and Cr Stuart Hart said borrowing more money would be irresponsible for the council.
“We have a defined superannuation benefits shortfall coming up, the estimates are $1.2 to 3 million – we’ll have a precise figure in a month or so,” Cr Stephen Hart said.
“A $4.2-million debt is quite low in historical terms and compared to other shires,” he said.
“To get another one so soon, it would be irresponsible to be borrowing – debt will double in one year.”
Cr Chris Smith said he disagreed with the budget’s impact on the council’s asset-to-liability ratio, which will be 134 per cent compared with the recommended 200 per cent.
He was also concerned about rising costs for council services such as pet registration, and a possible rates shortfall if farmers challenged their bills.
Cr Brian Crook said defended the budget, saying the council had a “low risk” rating from the state’s auditor general in its underlying result, liquidity, indebtedness, self-financing, capital replacement and renewal gap.
Cr Frank Buchanan said councillors had a responsibility to pass the budget, which also gave funding to the district’s event organisers.
“We have four formal briefings – which Chris Smith didn’t go to – but all of the other councillors agreed to 6.3 per cent,” he said.
“Then when it comes to voting time, they vote against it. That’s what I find extremely disappointing.”
