Changes to miscellaneous licences fall short, creating confusion and financial stress: Mt Magnet shire

A Mid West council says the passing of new legislation to “provide clarity” amid a mining rates dispute will do nothing but create more confusion and financial burden.

Reforms to the Local Government Act 1995 passed WA Parliament last Wednesday, which will exempt mining companies from paying rates to local governments under miscellaneous licences.

This came following a legal dispute between the Shire of Mt Magnet and Atlantic Vanadium last year, when WA Supreme Court Justice Marcus Solomon ruled the shire could charge levies on six miscellaneous licences.

The State Government was then said to jump to the rescue of the mining sector by introducing legislation, excluding these miscellaneous licences from council rates.

The changes will deplete the Shire of Mt Magnet’s revenue, while also leaving them with a hefty bill as the new laws include a retrospective clause that requires them to pay back these rates since 2017.

According to shire CEO Tralee Cable and president Jorgen Jensen, the tiny council overseeing a population of little more than 500 people will have to cough up between $350,000-$400,000 in reimbursements.

This is a move Cr Jensen said was another string in the bow of shifting more costs onto local governments.

Miscellaneous licences are usually used in conjunction with mining or exploration tenements to facilitate infrastructure such as roads, aerodromes, pipelines, and staff accommodation required to support mining activities.

Ms Cable said contrary to what the State Government had been saying, the changes did not introduce clarity to the situation.

“It’s increased the confusion unfortunately; the government appears to have disregarded the decision of Justice Solomon in the Supreme Court and what he said the consequences would be to this sort of a change to legislation,” she said.

“The problem that we have is that the intention of the government is not what the text advises, and I believe the text opens the door to challenges of significant financial impact.”

Ms Cable said the shire had tried on multiple occasions to communicate the financial struggle Mt Magnet would be put under if the changes were passed, yet said the State Government claimed in Parliament it had received no communication.

“Considering the intent to the legislation to clarify the situation, one would have thought that it would be very easy to negotiate directly with the local government that has the biggest problem with it,” she said.

Cr Jensen said it was clear to the shire the changes would be passed in Parliament based on the lack of communication and acknowledgement from the State Government, and “disappointingly neither from the two major opposition parties”.

“There is a lot of ambiguity and confusion around companies being able to claim back until 2017 and GRE rating on assets and miscellaneous releases,” he said.

“It’s potentially incredibly damaging and there is a lot of confusion between members of Parliament contradicting what’s actually written in the Act, as well as many not getting their head around the actual details.”

In regards to the changes to the Act, Cr Jensen viewed “every last one of them” to be negative.

“The changes will make local government in regional WA much, much harder. We already exist in a very tight fiscal environment and there is only a certain amount of revenue opportunities for us,” he said.

“We don’t have large rate bases, we have large areas of land to manage and large road networks . . . we are stuck in a situation.

“For 20 years there has been a constant cost shift onto local government, and I can’t see anything good about those changes. It makes it more cumbersome to operate local government for very little upside.”

Local Government Minister Hannah Beazley said the changes “ensure the long-held understanding within the local government and resource sectors that miscellaneous licences located on Crown land are not rateable”.

“The Cook Labor government has acted quickly to prevent significant extra costs being imposed on mining and exploration companies, as their viability is essential to creating and protecting jobs,” she said.

Ms Beazley said the State Government would continue to work with local governments, including any sustainability issues, as well as engage with the resources sector of how it continues to contribute to local communities.

Member for Geraldton Kirrilee Warr said the bill highlighted the disdain and disregard towards the regions.

“(The Government) has made it clear - local governments, particularly those in the regions, are not a priority,” she said.

“Future governments must support communities where the wealth is generated, instead of leaving them out of pocket with no means of assistance.”