A survey of councils covering more than 90 per cent of the state’s population found that 37 of them are “financially unsustainable” with rate increases of between 80 to 300 per cent needed in the coming decade to fix the shortfall in funds.

Yass Valley Council was not surveyed, as it is not one of the state’s largest 100 councils. Mr Rowe, however, suspects council would rate within the financially unsustainable category if included in the review.

“It is likely that smaller councils, such as Yass Valley, would be in the unsustainable bracket.”

Mr Rowe said he was not surprised by the report, which puts the total repair backlog of NSW councils at $4.5 billion, a figure so large that it could only be eliminated with funding from state and federal governments.

“We are always in need of more money for infrastructure,” he said.

“The only way to fix the backlog is to put more money into infrastructure otherwise unsustainable councils will continue down the spiralling path of deteriorating infrastructure.”

The review defines unsustainable councils as those that need to increase rates and charges by more than double the inflation rate to get their finances and infrastructure in order, not councils facing insolvency.

The study was based on publicised data for 2007-2008 and did not capture the impact of the global financial crisis which would be likely to exacerbate the problem.

The NSW Local Government and Shires Association says the report confirms what Local Government in NSW already knows – that inadequate financing has forced many NSW councils into an infrastructure renewal backlog.

“Through a combination of inadequate tax transfers from State to Federal coffers, and rate pegging, Local Government has been made to operate on a minimal budget for years,” President of the NSW Local Government Association, Cr Genia McCaffery said.

President of the Shires Association, Cr Bruce Miller, said that despite income restrictions councils have made some significant gains in addressing the infrastructure backlog through increased infrastructure spending.

“This demonstrates that councils have become very adept at doing a great deal with very little,” he said.