Ballarat City deputy mayor Mark Harris said the rate capping formula was broken and should be scrapped for a more modern system.

“What galled us was when our local member Sharon Knight put out radio ads saying councils were greedy and the government was here to stop rapacious rate rises,” he said.

“Rates are a historic anachronism, they are like a land tax - it is hardly equitable to have rates on property to fund roads.

“There are no direct connections, most councils acknowledge we don’t want to put rates up, but the formula is broken.”

The state government has commissioned an inquiry into rate capping, which is currently before parliament.

The Municipal Association of Victoria wants to remove rate caps so rural councils can address funding shortfalls for infrastructure maintenance.

Rural councils lost up to $1 million a year when the country bridge and roads program was scrapped in 2015.

The federal government also froze financial assistance grants, which were awarded to councils specifically for road maintenance, but left them with massive funding holes.

Wendouree MP Sharon Knight said the government went to the last election with a rate capping policy.

“We won the election and we implemented it as we said we would,” she said.

“Any council can go to the Essentials Services Commission and state they are under pressure, under hardship, and have that rate capping waived.

“I understand the city did that, and that was not waived.”

Pyrenees Shire Council successfully had a rate increase above the cap approved earlier this year.

The extra funding received under the plan must be quarantined for roads.

Pyrenees Shire mayor Ron Eason said rate capping was not in the best interest of small councils.

“We are trying to cover large expanses of roads with a small population base,” he said.

“We have limited ability to raise other revenue, whereas bigger councils can use parking fines and meters to raise more.”

Councillors who spoke with The Courier raised a variety of methods to increase revenue, but also stressed there had to be community consultation.

Some said pooling parking revenue from all councils, then distributing it equitably on a needs basis, would also be a good solution.

Potentially raising the GST was also suggested.

Hepburn Shire mayor Sebastian Klein said the municipality had planned for the funding changes before they were implemented.

“Our staff have pursued a range of efficiencies over the years,” he said.

“We anticipate being able to operate without an issues for the next few years.”

Cr Klein said Hepburn Shire now fixed roads when they required rather before they had issues, while works would be planned in geographical groups to be more efficient.