City of Busselton ratepayers will not see a five per cent increase in their rates next financial year as a result of the Performing Arts and Convention Centre, according to mayor Grant Henley.
Mr Henley said the City was not just reliant on rates with which to pay for the centre.
The construction of the $38 million centre was confirmed at a council meeting on November 24, when councillors awarded the tender to Broad Construction.
The motion was approved 5-4 with councillor Anne Ryan unsuccessfully raising an amendment to defer the development until 2023.
Cr Ryan has been vocal about her concerns on the building cost since before she was elected onto the council in October.
Mayor Henley said part of the payment towards the project would be within the usual CPI increase in rates of 2.5-3 per cent, which is outlined in the City's long-term financial plan.
"We estimate the impact of the BPACC on future rate increases will be a proportion of 2 per cent spread over the next three financial years," he said.
"We are looking at other levers to keep it to that such as reducing the transfers to reserves and other savings we can make to reduce the burden on ratepayers as asked of by council."
Busselton resident Keith Sims said the council vote was democratic but the result did not represent what the community was after.
He said the community survey earlier this year showed 64 per cent of residents did not want the current building with the $38 million price tag to go ahead.
"Figures and information from the Catalyse survey show the rate increase as $83, not a cup of coffee or $0.10c a day as some councillors try and tell us," Mr Sims said.
"The 25 per cent increase in interest rate to 2.5 per cent will also cause an increase. Yearly rate per cent increases will also cause that figure to compound, making it grow even higher every year."
The survey asked whether people would prefer to go ahead with the project as planned with the inflated cost, scale back the build at a reduced cost or not to proceed with the project at all.
Fifty three per cent of respondents said they would prefer not to proceed with the centre at all, 45 per cent of respondents supported the project with 34 per cent of those preferring to go ahead with the construction as planned at the higher cost, and 11 per cent preferring a scaled back building at a reduced cost.
The design includes a 600-seat auditorium, an art gallery that can host national and international exhibitions, separate function areas with seating up to 400 people to allow for a range of events including music concerts, orchestral shows, comedy, cabaret and dance performances, business events, award nights and graduations.
Construction is set to begin in December 2021.
Mayor Henley said the council made a difficult decision.
"In doing so, council delivered on a long held promise to provide a performing arts facility and recognised that a development of this kind would make a valued contribution to the social and economic growth of the district," he said.
During the council debate, councillor Phil Carter said the project was not going to get any cheaper.
"There has been serious under investment in the culture and arts in the City of Busselton and this decision is about balancing that social ledger," he said.
Mayor Henley said the City was aware of the community concern over the cost of the building but the timing was right due to low interest rates and support from the federal government.
If the motion was not approved, the city would have had to return the grant money it received from the federal government on the project.
"Council believes it has the financial capacity to proceed with the project while still delivering on its many other commitments," he said.
"We also have existing historical loans that are being paid out, most at much higher interest rates, which have repayments already built into our revenue base and these repayments can be incorporated into new community infrastructure loan requirements.
"This is part of the City's long term financial plan structure and will eventually allow a line of credit for new community project borrowings without the need for rate increases.
"The city will borrow for BPACC from Treasury at a fixed low rate for long terms and draw down those loans during construction.
"Additional funding sourced will of course further reduce these repayments."