MOREE Plains Shire Council will meet today at an extraordinary meeting to decide whether to push back against the scale and timing of a major NSW Government development that could reshape the region – but also place long-term financial pressure on ratepayers.

The Moree Special Activation Precinct, a state-led economic development project, is designed to draw industry, jobs and investment to the district, including new roads, water, sewer and servicing infrastructure.

However, a report by senior staff warns the current delivery model could overwhelm Council’s finances if it proceeds as planned.

The recommendation before councillors at today’s 4pm meeting is not to abandon the SAP, but to slow the project down by reducing the initial infrastructure burden from $79 million to around $40 million.

Moree Plains Shire mayor, Susannah Pearse, said the SAP is moving forward.

“Excitingly, 2026 will see the Moree Special Activation Precinct move from concept to physical works on the ground, as works begin on road and utilities infrastructure,” Cr Pearse said.

The Moree SAP Master Plan was finalised in March, 2022 by the Regional Growth NSW Development Corporation.

The NSW Government funds and builds major infrastructure, then transfers ownership of those assets – such as roads, drainage and services – to Council once completed.

From there, Council becomes responsible for maintaining, renewing and eventually replacing those assets.

“Whilst the precinct is a NSW Government initiative, in due course, water, sewer and road infrastructure will be handed over to Council to own, operate and maintain as Council assets, and we need to ensure we have adequate annual funds to do so,” Cr Pearse said.

According to the report to be discussed today, the current proposal would see around $79 million worth of infrastructure transferred to Council very early in the project’s life.

That infrastructure is designed to support 30 to 40 years of potential development, regardless of whether businesses actually move in at that pace.

The report says this creates a major mismatch between costs today and revenue tomorrow.

“The current proposal of $79m of SAP works will however stretch council’s already-tight budget, especially if we do not see businesses take up the opportunity,” Cr Pearse said.

The report says Council will need to start paying for and maintaining decades’ worth of infrastructure long before rates and fees to support the project are collected.

Council’s three key funds that would be affected include the General Fund, Water Fund and Sewer Fund.

Council’s General Fund for roads, public infrastructure and general services has a current projected surplus of $518,000 per year.

The estimated SAP impact is about $1.5 million per year in depreciation and operating costs, meaning the General Fund would be pushed into a structural deficit.

The report says Council could not absorb those costs unless existing services are cut or a special rate variation is adopted.

The report says additional rates generated by the SAP development would be small initially, and nowhere near enough to offset the costs.

The projected surplus for Council’s Water Fund is $993,000, with a zero cash reserve and an existing loan of $6.7 million.

The report says, under the current SAP plan, Council would immediately take on around $333,000 per year in new depreciation, ongoing maintenance costs and responsibility for major future upgrades.

NSW Public Works estimates Council will need to invest around $65 million in water infrastructure over the next 30 years to support the SAP, starting from year five.

The report warns this would almost certainly force further water price increases, even if grants are secured.

The Sewer Fund has a surplus of $930,000, with cash reserves just under $3 million.

Immediate SAP costs are modest, but NSW Public Works projects $27 million in sewer upgrades over 30 years, which would likely require grants or significant borrowing.

The report also raises concerns about how the SAP infrastructure would be handed over.

Under the current proposal, assets would be transferred on an ‘as-is, where-is’ basis.

Council will rely on warranties in contracts it is not a party to, with suggestions there is limited assurance assets will meet Council standards – once defect periods expire, any hidden problems become ratepayers’ problems, the report says.

Rather than reject the SAP, the report proposes a staged delivery model, with initial infrastructure capped at around $40 million and road infrastructure capped at $20 million.

“As such, the report on today’s agenda recommends we ask the NSW Government to stage this body of work,” Cr Pearse said.

“By ‘doing it in sections’, the State Government investment can progress over time but in a way to limit the financial burden on council and ratepayers.

“If we spread it out over more years, we should see revenues begin to come in,” she said.

“Council recognises that to sustain and grow our population, we need to diversify and welcome new industries to town.

“The SAP provides one way of doing so and we are grateful for the NSW Government investment and support.

“The report is not about turning down opportunities; it is about balancing them with what we can afford,” she said.

Councillors today will be asked to note ongoing negotiations with RGDC; endorse the staged delivery approach; support the $40 million infrastructure cap; authorise general manager Natalia Cowley to formally request changes to the deal; and acknowledge the aim is to protect Council’s finances while still supporting long-term growth.

If endorsed, the general manager will write to RGDC seeking revised terms before any final contracts are signed.

“Many councils in New South Wales have been significantly increasing rates to cover every day operating costs and infrastructure maintenance and renewal. That is not a path that we want to be heading down,” Cr Pearse said.

“We want an exciting and prosperous future for our shire and we hope that the SAP will play a big part in getting us there.

“But our responsibilities to current residents and ratepayers must come first,” she said.