7 days ago
Shire of Coolgardie angers mining industry with 97 per cent rates hike
A cash-strapped regional shire in Western Australia's Goldfields is pushing on with plans to hike mining rates despite significant public backlash.
The move has drawn the ire of industry titans in Perth and local prospectors.
The Shire of Coolgardie, which was founded on the discovery of gold in 1892, has taken drastic steps since March when it revealed it was facing a $6.5 million budget deficit.
The local government, colloquially known as "the mother of the Goldfields", was already dealing with an ongoing investigation into former CEO James Trail when it this month proposed raising mining rates by 119 per cent.
The plan to increase the rate in the dollar for mining rates from 0.23667 to 0.52030 would result in increases for all operating mining companies and tenements within the shire.
The proposal attracted 21 submissions during public consultation, with a further 179 submissions lodged in a petition.
Objections flowed from major employers in the Goldfields, including companies controlled by mining magnates Andrew Forrest and Chris Ellison, and powerful lobby groups such as the Association of Mining and Exploration Companies (AMEC).
At Tuesday's ordinary council meeting in Coolgardie, councillors voted in favour of a slightly reduced increase in the rate in the dollar of 0.46827.
It equated to a 97 per cent increase in mining rates.
Councillors also agreed to provide a 30 per cent concession for prospectors and a 25 per cent concession for exploration companies, reducing forecast rates revenue by $481,478.
The shire has forecast rates revenue of $20.57 million in 2025-26, up $7.86 million from the $12.71 million forecast in 2024-25.
Shire of Coolgardie president Mal Cullen had defended the proposed increase, telling the ABC the additional income would help cover the cost of a $10.4 million capital works program to repair roads damaged by increased heavy vehicle movements and mining activity in the past three years.
"The reasoning behind the proposed increase is to maintain infrastructure in the shire, such as the road network," he said.
"The cost of operation of local government these days is significant."
Deputy shire president Tracey Rathbone said the shire had done its best under the circumstances, telling the packed public gallery at Tuesday's meeting that "voices have been heard".
"It has not been an easy budget to work through," she said.
The angry response to the proposed hike was reflected by the Eastern Goldfields Prospectors Association, which took out a full-page newspaper advertisement in Tuesday's edition of the Kalgoorlie Miner.
The advertisement depicted the shire as the grim reaper and urged ratepayers to "stand with us", calling for the appointment of administrators and for Local Government Minister Hannah Beazley to intervene "before mining is destroyed".
"We're upset, our members are ropeable they've been targeted to get the shire out of trouble," president Cranston Edwards said.
"They just go to the mining industry for a quick fix, it's a like a drug addict … we've been attacked."
Prospector Ferdinand Gere said the proposed rates hike was unrealistic and scandalous.
Privately-owned gold miner, Corinthian Mining, said if approved, the rates bill on its tenements would jump nearly $300,000 a year to $511,534.
The shire disputed that figure.
Corinthian Mining managing director Noel Wemyss said it risked Coolgardie's reputation as a stable place to invest.
Ms Beazley has been contacted for comment.
Mr Ellison's Mineral Resources, which placed its Bald Hill mine near Kambalda into care and maintenance last year, has been working closely with the Shire of Coolgardie on plans to upgrade the Kambalda Airport.
It said the proposed increases differed markedly from neighbouring local governments with no evidence-based rationale to justify the hike.
In response to a similar comment during the council meeting's public question time, shire president Mal Cullen said each shire had different budget considerations to work through when drafting rate increases.
Mineral Resources manager of land access and tenure, Michael Bycroft, said it would result in a $400,000 increase in rates, describing the proposed hike as "unfair and inequitable".
Mr Forrest's Wyloo Metals, which closed its Kambalda nickel mines last year, wrote in its public submission to the shire that its rates bill would increase from $725,471 to $1.74 million as a result of the proposed hike.
Wyloo's Kambalda asset president, Zoran Seat, noted the financial impact of the shire's decision to build a 328-bed workers camp in Kambalda, known as Bluebush Village.
He said multi-million dollar losses from the effectively failed investment by the shire had directly contributed to its deficit.
"We have serious concerns that the proposed rate hike is being implemented to raise funds to address the shortfall in finances the shire is facing, rather than as part of a fair or sustainable fiscal strategy," Mr Seat wrote.
ASX-listed exploration company WIN Metals said its rates bill would jump from $299,000 a year to $511,000, which it described as "simply ridiculous".
"The shire and its financial issues are entirely of its own creation," WIN Metals managing director Steve Norregaard said.
A submission from AMEC chief executive Warren Pearce called it an "extraordinary leap", saying he was not unsympathetic to the shire's financial woes but "exorbitant rates" were not the solution.
Mining giant Rio Tinto, via its general manager of technical services for lithium, Leigh Slomp, said mining growth was fragile.
He pointed to a recent downturn in nickel and lithium as examples.
"It threatens to severely undermine confidence in Coolgardie as a mining-friendly shire and ultimately reduce long-term revenue as companies reassess the attractiveness of operating in Coolgardie and its reputation as a stable place to invest," he said.
Gold miner Evolution Mining, which this year completed a $228 million expansion of its Mungari operations, estimated the rates on its mining tenements would increase by $1.6 million to $2.8 million.
Evolution Mining also owns the 100-bed Kurrajong Village in Coolgardie, with the company calculating the rates for the workforce accommodation would increase by $784,237 to $1.43 million.
Mungari general manager Scott Barber said the increases would have lasting and long-term repercussions, adding the company would be asking the local government minister to intervene.
ASX-listed Minerals 260 in January paid $166.5 million to acquire the Bullabulling gold project near Coolgardie.
It plans to enter production in 2028 with a mine employing about 350 workers.
Minerals 260 managing director Luke McFadyen said the proposed rates hike would deter investment in the region, reduce exploration activity and discourage the key industry which underpinned the local economy.
