The owners of Hazelwood power station and mine will still be required to pay rates to council once power generation ceases at the end of March, given they still own the land.
Majority owner Engie pays Latrobe City an amount in lieu of rates, which is calculated in accordance with an order published in a 2005 Victorian Government Gazette.
This is because land exclusively used for mining purposes is not rateable.
Latrobe City chief executive Gary Van Driel would not disclose the amount Engie currently contributes for the Hazelwood power plant “with consideration to our ratepayers’ privacy”.
But he confirmed council needed to explore the full ramifications the Hazelwood closure would have on council’s budget.
“However, it would be prudent to take into consideration the closure when determining the level and quantity of services to be provided going forward,” Mr Van Driel said.
He did not expect the closure to “leave an immediate shortfall” in the 2016/17 budget, but said council needed to review its short and long-term financial plans.
Once generation ceases, site owners will no longer be eligible to pay an amount in lieu of rates under the Electricity Industry Act 2000.
Mr Van Driel said the owner would instead be liable to pay rates, unless the State Government took over ownership.
“Ownership of the site, we must assume, will be determined by the ownership agreement with the Victorian State Government,” he said.
“Council is not aware of the terms in relation to this agreement.”
When asked whether council would seek compensation so any shortfall did not impact on ratepayers, Mr Van Driel said the matter had been raised with the government.
Local Government Minister Natalie Hutchins assured the Latrobe Valley community the government would stand by them.
“We have been very clear that we will stand by the community and work with the council to help them through this difficult time,” Ms Hutchins said.
General property valuations for rating purposes take place every two years, with the latest undertaken this year for the 2016/17 rates.
The next revaluation is due for the 2018/19 rating year.
