Hawkesbury City Council's latest financial report card reveals a challenging landscape where a budgetary shortfall of $1.3 million has been offset partially by external one-off payments.

The December 2024 Quarterly Budget Review Statement showed that key revenue streams are facing downward pressure, that costs have blown out in a number of areas and that HCC continues to frustrate ratepayers as it drags its feet on compliance and continues to over-rely on external consultants.

A noticeable slump in building compliance revenue is impacting the bottom line, with the report stating that "the number of fines is below the budgeted amount," leading to a $208,000 deficit. 

“Enforcement & compliance squeeze is the squeakiest of squeaky wheels in council”, Councillor Nathan Zamprogno told the Hawkesbury Post. “I get more complaints about this than any other issue. People are waiting for too long for compliance orders and enforcement.

Similarly, a decline in complying development income, stemming from fewer projects, has contributed to a $202,000 deficit in that budget line, with the Review saying there is a reduced revenue as "the number of complying developments is lower than budgeted for".. 

These shortfalls suggest a need for close attention to “development sector trends” and the effectiveness of “regulatory enforcement”, the council states, begging the question about how a local government entity is not on top of such trends.

Operational costs are also climbing at the Companion Animal Shelter. As authorities reveal that the shelter "is operating at capacity" which has increased operating expenses to exceed the initial budget allocations by $262,000. This increase is primarily due to the Shelter "operating at capacity" and increased labour and veterinary costs. 

HCC opens its shelter to other councils that do not have them, a key reason behind its capacity and raising the question about whether costs are being recovered effectively.

The number of development applications that require consultants has further affected Development Assessment consultancy fees, and also contributed to a drag on funds.

“Council makes too much use of external consultants, and not enough on cultivating well qualified people in the organisation,” Cr Zamprogno said.

The downturn in Development Applications is further compounded as "the number of Construction Certificate applications has been lower than expected", which has reduced the income received. The revenue losses caused by the shortfall of Development Applications is recorded at $131,000, followed by $109,000 in lost Construction Certificate income.

Other unfavourable adjustments to the budget included Consultancy fees for Heritage works ($64,000), Development Assessment casuals ($56,000), Sewage Management Facility reinspection fees ($50,000) and Occupation Certificates ($50,000).

However, the Council's Investment Portfolio has "exceeded budget expectations" by $611,000, offsetting some revenue shortfalls. This positive outcome is "due to higher interest rates obtained and higher than budgeted funds to invest." 

Revenue was also boosted, due to a number of “favourable adjustments” i.e. one-off windfall payments such as a $649,000 reimbursement received from Transport for NSW for “Recovery of Natural Disaster Expenses” (April 24). Leaseback changeover costs are down by $271,000, Property Lease Rental lower by $168,000, and the Emergency Services Levy was $154,000 lower than budget. There was also another windfall of $87,000 from an Insurance Settlement from Storm Damage in 2020. The offloading of the running of the Lower Portland Ferry to the State government saw another $171,000 windfall in savings.

In regard to cash assets, the " projected financial position at 30 June 2025 will be satisfactory at year end, having regard to the projected estimates of income and expenditure and the original budgeted income and expenditure as shown in Council's accounting records". 

The review also states “factors outside the Council’s control” could impact the end of year financial position, without detailing any of these factors. The Council forecast that it would end the year in a “satisfactory” short-term position.