Kempsey Council still waiting on $6 million in disaster recovery reimbursements

A February council meeting has revealed Kempsey Shire is still waiting on the NSW government to reimburse $6 million in disaster recovery costs, nine months after major flooding inundated the CBD.

What happened: Kempsey Council spent massively on repairs in 2025 after multiple major weather events.

• The impacts of a tropical cyclone in March, a major flood event in May and a severe storm in early August all had to be covered by the council in the wake of the disasters.

Who pays when: Following a disaster like the major flood event in May, local councils are responsible for delivering emergency recovery works which are expected to be reimbursed down the track.

• Kempsey council said it funds the disaster recovery works out of an unrestricted but small cash reserve, resulting in an overhead for the council. 

• It then lodges claims with the NSW Reconstruction Authority (RA) to have that money repaid.

As it stands, Kempsey Shire Council remains millions out of pocket as it waits for claims to be approved.

“Poor performance”: Kempsey Council’s CEO Andrew Meddle said during the meeting that local council’s peak body, LGNSW, is leading a campaign to address what he referred to as “the very poor performance of RA in terms of turning around claims and paying for the works that councils have already undertaken in good faith”.

• LGNSW President and Inner West mayor Darcy Byrne said the “massive increase” in floods, storms and fires across the state has devastated many local councils and their communities.

• “While the Reconstruction Authority is improving, the system for processing claims is inadequate with payments totalling hundreds of millions of dollars overdue to councils who are struggling with recovery,” Byrne said in a statement.

Not the only one: President Byrne said Kempsey wasn’t the only Mid North Coast council waiting on claims to be processed. For MidCoast Council in the south of the region, the May floods had an impact of $226.5 million on transport and infrastructure. 

• “To date, the [MidCoast] council has spent $43 million on emergency and immediate reconstruction works on its transport network and has only received $6.1 million from the NSW Reconstruction Authority,” Byrne said.

As we approach the one year anniversary of these devastating floods, Byrne said it’s time recovery funding is paid in full.

Ratepayers footing the bill: Kempsey Shire Council’s Director of Corporate and Commercial, Daniel Thoroughgood, put the local impact into numbers for the councillors.

• “From the last couple of events, we have expended $12 million of our money on undertaking those works,” Thoroughgood said. “We've received $6 million reimbursement so far from RA and we are carrying $6 million of that debt, essentially currently ourselves.”
  

• “Given that council is in a position where it is borrowing money to undertake our own works… our ratepayers are paying interest on that money we are carrying for the state government,” Thoroughgood said.

Thumbnail: Kempsey CBD after May floods 2025. Kempsey Shire Council Facebook.