Carterton District Council set out to fix a real problem. Instead it has shown how a single upstream data error can shift large sums between ratepayers, and how exposed forest owners are when that happens.
Ahead of a two-day hearing starting 11 November, a report from chief executive Geoff Hamilton recommends against proceeding with the rating review as consulted on. That is the right call. The more useful lesson is how the proposal got this far.
The number that moved on its own
Under the consulted proposal, the average forestry rating unit’s bill rises from $2,825 to $38,391 a year. When consultation opened in August, the modelled forestry increase was 793.5%. After the correction it is 1258.7%. Dairy moved the other way, from 144.4% down to 91.8%, with typical bills going from $8,825 to $16,929.
The cause was not a policy choice. Morrison Low, the consultancy hired by the three Wairarapa councils, used Wairarapa dairy production volumes that included herds in neighbouring Tararua, while the land area used to allocate that production left Tararua out. Carterton dairy farmer and Fonterra Shareholder Councillor John Stevenson caught the discrepancy by checking the figures against DairyNZ data. The council did not find it. A ratepayer did.
One input fixed, and forestry’s bill grows by another 465 percentage points. Any business would regard a cost forecast that sensitive as unfit for a budget, let alone for a permanent rating policy.
Best practice, built on stale forecasts
The council commissioned Infometrics to peer review the model. It found the work follows best practice for apportioning roading costs, then listed problems underneath it. MPI forecasts used in the model expected 28,235 in forestry removals for 2022-2026, while the actual figure was 17,380, an overestimate of more than 60%. The review also said forestry tonnages may be underestimated, and that farm foresters, who own 26% of exotic forestry in the southern North Island and typically run blocks under 40 hectares, were not handled properly.
Some of these errors push forestry’s share up and some push it down. The method may be sound in theory, but the corrected 1260% figure is not a settled number.
Tonnes are not axles
There is a more basic dispute that the peer review did not settle. An industry submission argued that Morrison Low should have allocated costs using equivalent standard axles and distance travelled, not freight tonnage. It cited TERNZ engineering work concluding pavement wear should be assessed on axle loading and distance, and questioned whether tonnage alone is robust enough to justify increases of this size.
This matters because other councils will be looking at the same approach. If the method is contestable at its foundation, every council that copies it will face the same argument.
Charging twice for the same road
Juken New Zealand chief forest officer Sean McBride points out that log trucks already pay road user charges, and forests can go decades without producing any logging traffic while owners still pay rates every year. NZFOA chief operating officer Joseph Brolly says a 300-hectare forest would go from $8,700 to $107,700 a year, “more than 12 times the current bill”.
Farmers Weekly columnist Alan Emerson notes that roughly half of RUC revenue already returns to councils. That makes a targeted roading rate look like a second charge for the same roads. On a 28-30 year harvest cycle, owners could pay a decade or more of inflated bills before any harvest income arrives. For forest owners, that is a cost that goes straight into land values. Emerson warns it could mean “the death of productive farming and forestry” in Carterton and any council that follows its lead.
Carterton has a fair point
The council’s starting concern is reasonable. Hamilton notes Carterton is the only rural council where residential rates exceed rural rates on average, and it ranks fourth highest among all territorial authorities in Taxpayers’ Union tables. About 4,700 residential and lifestyle properties stood to get a 14% cut. Still, of nearly 500 submissions, about 80% opposed the proposal.
Hamilton now recommends staggering changes over several years and limiting how much roading cost goes through the variable targeted rate. That is a sensible retreat. A long-standing imbalance is better fixed gradually than by forcing a 13-fold cost increase on one sector.
What happens next
More than 50 submitters will speak this week. Councillors should go beyond diluting the proposal. They should require the methodology dispute to be resolved, the forecasts updated and the RUC overlap accounted for before any new figures are put to ratepayers. Other councils watching Carterton should take note. A rates model that moves hundreds of percentage points on a single data correction is not ready to be used.
Sources
- NZ Herald: Carterton rates review could be halted amid backlash, faulty modelling (2026-11-09)
- NZ Herald: Carterton forestry rates: Corrected modelling raises average increase to 1260% (2026-10-15)
- The Post: Carterton council staff advise against rates review in its current form (2026-11-08)
- Scoop: Forestry Leaders Say 1260% Rates Hike Puts Jobs At Risk (2026-10-21)
- Carterton District Council: Rating Review – Original Analysis versus Updated Analysis (2026-10)
- Infometrics: Peer Review of Roading Rate Modelling for Carterton District Council (2026-10)
- Carterton District Council: Response to Rating Review Consultation (2026-09)
- Farmers Weekly: Rating productive farming and forestry out of existence (2026-10-27)
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