Communities get stirred up over hikes in annual rates and charges and criticism can be pretty heated.

So, a small increase in 2016-17 is good news, although some ratepayers will still resent it.

The Independent Pricing and Regulatory Tribunal (IPART) announced the rate peg on Friday, saying councils' costs were stable and there was no justification to increase the burden on ratepayers beyond inflation.

Many councils will be unhappy.

Rates are the main source of their general income. And the peg comes amid the furore over the NSW government's determination to see local governments merge under its Fit For The Future policy.

Emotions are already high - and now the revenue purse strings have been pulled a bit tighter.

Dubbo said it will just have to work within the figure. Wellington said it was not enough given increases in its costs.

Councils can ask IPART for a special variation to charge more, but it might be a brave move in the merger environment.

Dubbo ratepayers are quickly brought to boiling point over water charges. Across the years, they have been charged more as they use less.

Water charges are not included in the peg.

As some water lawns during the weekend, they will wonder why IPART does not look at that council tap.