Lake Macquarie City Council predicts $30 million in lost rate revenue across the next 10 years due to IPART rate peg of 0.7 per cent

Almost 60 per cent of the council's revenue comes from rates, and with projects and long-term financial plans forecast with the expected 2.5 per cent rate peg, it anticipates it will lose more than $2.6 million each year.

The real cost will come to the community, LMCC chief executive Morven Cameron said, with a savings plan likely to lead to a reel back on services.

"I'm not going to pull the tablecloth off and there be this dramatic shutdown of services, we have a $420 million budget and 1300 employees so we will do the best we can to make sure the actual direct impact on the community is felt as little as possible," she said.

"But it does mean a road might take an extra year to be resurfaced, a bridge might take longer to get fixed, we aren't going to stop delivering services but the biggest impact will be on our long-term ability to look after assets."

It could mean playground equipment that normally gets replaced on a 10 to 15 year cycle could be put on the backburner as the council scrimps and saves.

Councils across the state were shocked in late 2021 when IPART announced the maximum amount that rates could be raised by was 0.7 per cent.

It was significantly lower than the 2.5 per cent Lake Macquarie not only expected - but used to forecast major documents like its long-term financials and the Community Strategic Plan - which sets out the vision for the future. But, there is an option to claw the money back - IPART has announced a one-off opportunity for councils to apply for an additional special rate variation to make up the extra 1.8 per cent.

Ms Cameron said that decision will be in the council's hands.

"If we wanted to increase 1.8 per cent above a rate peg we would have to do significant consultation and demonstrate to IPART why the rates are going up and the impact on the city," she said.

"Yet IPART can make a decision that has a $30 million impact on our city over 10 years with no consultation or conversation, that's the most frustrating or galling part.

"To take that money out affects our ability to maintain roads and look after parks to the standard the community expects and that we want to deliver."

The deadline to apply for an additional SRV is April 29, and it is expected to be a shorter process than normal.

The council is expected to discuss whether it will apply for an additional SRV at its next meeting.

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