The domestic refuse levy will also increased by £1 a week to £202.
James Horton, chairman of the board, said: ‘No local authority wishes to announce significant rate increases, however it is a matter of public record that we underestimated the level of financial challenge which awaited us in 2022.
s detailed in our annual accounts, the town operated at a significant deficit to the rates collected for the year ended March 31, 2022, and has continued to do so into the current financial year.
‘Intervention is now required to address the deficit without further depleting our general reserve.
‘We must also make additional provision for increases to costs in the forthcoming municipal year, a number of which remain undefined.
‘The significant inflationary pressures experienced have led the board to make difficult decisions.
‘We have been united in our view that whilst an clear option, we do not wish to significantly cut spending on services and support for events within the town which will provide a saving now but will be to the detriment of residents and visitors at a later date.
‘We shall however change the way in which we deliver some services with immediate effect which will result in cost savings of just over £19,000 over the next 12 months.
‘The uplift both addresses the town’s current operating deficit and ensures that we are best placed to deal with challenges and deliver some of the improvements that the public are seeking.
‘While there have been significant increases in borrowing costs, sanitation and employee costs remain the commissioners highest areas of expenditure.
‘Our refuse and sanitation costs continue to increase significantly and the refuse levy increase now fully covers these costs. We continue to waive collection charges for commercial refuse in an effort to support businesses that are located in our town and we are in dialogue with providers to improve recycling options.
‘In 2022 the town was consistently delivering between 110 - 120 tonnes of refuse to the EFW [energy from waste - or incinerator] plant a month and we will contribute £94,710 to the Southern Recycling Centre.
‘Employee costs reduced marginally in 2022 but have once again come under pressure following the 6.5% public sector pay award. While inflation is reducing we anticipate a similar situation in the forthcoming financial year.
‘The demolition of properties connected to School Hill has had a clear impact on collected rates in recent years, however we now expect that there will be near term organic growth in the rateable value of the town as the two significant residential developments progress and more properties are occupied, we also anticipate rental incomes from leases within our portfolio and other income streams to return to pre-Covid levels.
‘Provided that inflation continues to fall as expected, the general reserve will be returned to a level that is prudent and appropriate for the size of the authority during our term.
‘I would like to take this opportunity to thank the individuals and businesses that continue to invest in Castletown and fund our operations through the rate system. I feel that we are close to unlocking the towns potential for residents and visitors alike.
‘We as a board absolutely recognise that the same inflationary pressures have affected residents and local businesses and we are also conscious of the burden placed on the ratepayers of Castletown through providing services and events which benefit the wider population.
‘The commissioners aspire to facilitate a more collaborative working relationship with other local authorities in future years and remain supportive of efforts to reform the rating system on the island.
‘The current rates system dates back to the 1960s, with properties assessed on their rental value, yet a desirable six-bed period town house has an identical rateable value to a three-bed social housing property. Something needs to change.’
The value of penny in Castletown is £2,562.38.
After collection charge, deductions and defaults the commissioners estimate to receive approximately £2,326.76 per 1p levied.
The average rateable value of a residential property in Castletown is £119. A property of this rating will see an increase of £104.36 a year. (£52 refuse levy / £52.36 rates)