Councils facing £750m extra costs, says WLGA
Councils will need to cover extra costs worth £750m by 2019-20, the Welsh Local Government Association has said.
The body, which represents Wales' 22 councils, said increasing demand is "most acute" in social services and education.
It added the costs are the equivalent of annual council tax increases of nearly 15%.
The Welsh Government said it expects local authorities to limit the impact on taxpayers.
It said its provisional financial settlement for councils gives them a "stable platform".
There is an informal cap of 5% on council tax increases.
The funding gap could also be covered by cuts, more fees for services, or increases in Welsh Government funding for councils.
As well as rising demand for services, the Welsh Local Government Association (WLGA) said the National Living Wage, the Apprenticeship Levy and additional pension contributions also need to be funded.
'Nowhere near enough'
The WLGA gave evidence on Wednesday to the assembly's finance committee on the Welsh Government's draft budget for 2017-18.
In written evidence to AMs, it sets out the extent to which council tax would need to rise to cover the new costs.
It said: "While council tax continues to be an important source of income for local authorities, future increases are nowhere near enough to fund the pressures highlighted above.
"Assuming funding stays flat in cash terms, council tax would have to increase by nearly 15% every year up to 2019-20."
Last month, Local Government Secretary Mark Drakeford announced many local councils would see their first increase in Welsh Government funding since 2013-14.
A total of £4.1bn will be divided between Wales' 22 local councils, a cash increase of £3.8m on 2016-17.
A spokeswoman for the Welsh Government said: "The setting of council tax is a matter for each authority and we would expect them to act reasonably in balancing their responsibility to deliver key services with limiting the impact they place on local taxpayers.
"It is also important to recognise that local authority spending is funded from a variety of sources including fees and charges and specific grants."