Tagged: Tourism

Dam disclosure: full council meeting (22 October)

The full council meeting was held on 22 October 2015. Apologies were received from Cr Mirfin. All other councillors were present.

The agenda included: (1) Reserve classification of Rabbit Island, Rough Island, and Best Island, (2) Queen street reinstatement project, (3) Tasman historic wharves, (4) Krammer occupancy update, (5) Surplus treatment, (6) Tourist sign application, (7) Mayor’s report, (8) CEO’s report, and (9) Waimea community dam project status update report.

This was an eventful day. With one member of the public being asked to leave the council chamber under police escort, and council deciding at the last minute not to exclude the public from the Waimea community dam update deliberations. I will start with the public forum.

Public forum

Maxwell Clarke questioned the purpose of reserve park classification and suggested that the process was part of a wider arrangement (agreed 8 earlier) to swap Rabbit Island for land needed in the construction of the Waimea community dam. He asked the mayor to confirm if this was the case (or not). He also suggested that weirs could have been constructed for the amount of money already spent investigating the viability of the dam. Mr Clarke stated that a report written by Fred diCanzo for the TDC had observed that the decline of the Waimea aquifer was because: (1) tree’s along the river prevented the naturally wide flood plain being fully used to replenish the aquifer, and (2) the lowering water table had caused deep channels in the river, which further reduced the river’s ability to recharge the aquifer.

Reg Turner (“an award winning accommodation provider of 41 years”) responded to the report at page 67 of the agenda. He disputed the contents and accuracy of the report (addressing a number of paragraphs in the report). Mr Turner also tabled an application letter from him to TDC (dated 23 July 2015), on paper displaying the logo of his accommodation business. I will discuss the report and Mr Turner’s presentation below.

Unfortunately, Mr Turner was not allowed to complete all of his presentation. This is because the speaking time for the public forum is only 5 minutes, and the mayor did not permit Mr Turner to speak any longer. On being asked to sit down, Mr Turner refused (stating he only needed an extra 2 minutes to complete his speech), the mayor then asked the CEO to remove him from the chamber.

In my opinion this was an unfortunate situation and was handled poorly by the mayor. There was no reason why Mr Turner could not have been provided more time, as there were no other presentations in the public forum. Further, he had come considerable distance (and at some cost) to present his case before the elected representatives of the community. As other councillors left the chamber, Cr Bouillir, Cr Higgins, and myself remained to hear the remaining 2 minutes of his presentation (along with two members of the public). A typed copy of his presentation was also tabled.

The media has since published a story on the event. I agree with Cr Bouillir’s comments in the media article. Mr Turner should have been allowed to finish. It’s why I stayed to hear him out (see http://nelsonlive.co.nz/news/2015/10/manthrowntdc-meeting/).

Waimea community dam update

The council resolution for the Waimea community dam project status update report originally proposed to exclude the public from deliberations. However, the resolution did not receive the support of council and therefore the report was considered in public.

The report focused on two items: (1) the recently acquired resource consent (for the Dam), and (2) WCDL’s proposed financing and governance structure for a proposed Dam company. A highlight of this report for me was council doing a u-turn on gifting $300,000 to Waimea Community Dam Ltd (WCDL) under a loan arrangement that was unlikely to be recovered if the dam did not proceed. See some of my earlier posts on the dam (www.greeningtasman.wordpress.com/2015/06/02/long-term-plan-meeting-full-council-28-may/www.greeningtasman.wordpress.com/2015/09/08/full-council-meeting-30-july/www.greeningtasman.wordpress.com/2015/09/20/full-council-meeting-10-september/)

Resource consent

On 10 September 2015, the council considered a late confidential item concerning Waimea Community Dam Ltd’s (WCDL’s) refusal to handover a resource consent it had obtained under a prior funding and support agreement (dated 3 October 2014) with council.

Under that agreement, the council undertook to provide funding to WCDL to secure a resource consent (for the proposed Dam) for the council. This was because the council could not apply for a resource consent itself, and WCDL was a vehicle that was already formed, that could be used to test if a resource consent could be obtained for a dam. If a resource consent could not be obtained, then the dam project would be parked, and other water augmentation solutions explored. Using WCDL, avoided the need for council to form a company itself. To protect ratepayer funds, council entered into a funding and support agreement with WCDL, whereby WCDL agreed to handover the resource consent to council by a specified date, or on formation of a CCO, whichever occurred earlier.

Unfortunately, WCDL considered that this was not what was agreed, and refused to handover the resource consent to council on the specified date (in the absence of a CCO being formed). WCDL argued that a CCO had not been formed, and that they would only hand the resource consent to the entity choose to form the dam (not council).

In my opinion, this was an extraordinary position for WCDL to adopt. They had obtained a resource consent, funded totally from ratepayer money, and had signed a written agreement that set out the conditions for the handing over the consent to the people funding the exercise (council).

Council was faced with two options. It could proceed to court (more legal costs to enforce the agreement), or it could negotiate a solution that avoided such an outcome. Council’s preference was for a negotiated solution to be explored first. A suggested solution, was to both hold the resource consent – but without compromising councils legal rights to the consent (and the money spent to secure it). In my mind, if the dam did not proceed, the resource consent would be worth very little to council. Hence council were, in reality, giving up very little.

Accordingly, council resolved to instruct the CEO to “take necessary measures to have WCDL meet its obligations” under the funding and support agreement. At the project steering group (PSG) meeting (of 24 September 2015), the proposal for “joint holder status” was put to WCDL to avoid escalating the issue (on a without prejudice basis) to the courts.

Under this new proposed arrangement (to register WCDL as a joint holder of the resource consent), WCDL would hold the councils interest in the resource consent (as a trustee) under trust (with the council being the beneficiary). This meant WCDL could not use, transfer, or encumber the resource consent in any way. For example, it could not use the resource consent as security to raise funds for irrigators or sell it to another party. This also meant that WCDL could not ignore that fact that the value of the consent remained councils (as it was not theirs). Council also undertook not encumber or transfer the consent.

As part of this new arrangement, council would continue to advance $70,000 of water levy funds (that council could levy water users under its legislative powers) to WCDL, but would not advance $300,000 (as originally proposed in the LTP). The removal of the $300,000 grant was a good outcome. As some readers will be aware (from earlier posts on the LTP), I was opposed to council giving ratepayer funds to a private company – as was Cr Canton and Cr Bouillir.

However, at this meeting it was clear that WCDL continued to advance the argument that they did not want costs council had incurred up to now, to be considered to be part of councils final contribution to the dam. Accordingly, I was at pains to emphasise to WCDL (and councillors), that joint holder status should not be confused with joint ownership. By registering WCDL as a joint holder it could be perceived that we are giving WCDL half the value of the consent (like registering someone on the ownership papers of a car).

I was at pains to emphasise that if council thought it was doing this, then it should not support joint registration. If WCDL thought council was doing this, then they needed to think again. Rather this was an arrangement formed under trust law – whereby the beneficial interest was not given up. And council would continue to treat the cost of the resource consent as part of its financial contribution to any dam construction.

WCDL’s proposed structure

The report advised that the PSG had met with WCDL in late August to hear about WCDL’s proposed business model for dam construction. At that meeting WCDL proposed a preferred joint venture businesses model that would enable the formation of a CCO that would then enable the CCO to utilise the Public Works Act. The PSG undertook at this meeting to brief council of WCDL’s suggested business model at this meeting.

The report outlined the key structural elements of the proposed joint venture structure. Which is illustrated below.

DamCo-Sturcture-OptionB

The key structural elements were:

  • 50:50 ownership of co-operative company called Dam Co – thus holding the status of a CCO.
  • Dam Co construct, owns, and operates the dam.
  • Dam Co enters into water supply agreements with TDC and WCDL.
  • WCDL enters into water supply agreements with irrigators.

The key financial elements of the proposal were:

  • Dam costings use P50 pricing model (estimated to be $65 million).
  • WCDL and TDC invest $20 million each.
  • WCDL’s $20 million would include a $8.7 million loan from CIL.
  • Dam Co raises $17 million debt. This would appear to be paid off (funded) by subsequent irrigator uptake. However, liability for the debt (and servicing interest) would appear to be the responsibility of the current shareholders (and apportioned according to the shareholding at that time).
  • Dam Co received $8 million of grants.

Understandably, council had concerns with a number of the financial elements of the proposed joint venture structure. These were:

  • Pricing methodology (use of P50 over P95 pricing estimates).
  • $20 million equity from WCDL (for a $65 or $75 million dam).
  • $25 million from alternate sources (possibly $35 million if the dam is $75 million). In particular, debt funding of $17 million (and top up grants of $8 million).

Pricing methodology

A P95 estimate provides 95% certainty of pricing. A P50 provides 50% certainty over price. Commencing a project with a P50 rather than P95 pricing estimate increases risk of cost over-runs, without clarity over who will fund the over-run. Under a normal joint venture (50:50 ownership) both parties would be equally responsible. Any investment of council funds would have to have P95 security level.

WCDL’s initial investment

While this fits with the appearance of a 50:50 ownership model, 66% of dam water is intended for irrigators, and the total cost of the dam is $75 million (or $65 million under a P50). At the start, council is expected to take up irrigation for 1400 ha of land (this figure includes current and future users) and irrigators 2600 ha (expected to increase to 4500 ha). At a very simple level the numbers do not add up to legitimately justify equal ownership.

In my opinion, the drive for equal ownership appears to be an attempt to fit the proposal into the legal requirements for a CCO under the Local Government Act and the Public Works Act. To be a CCO, council must have control over the objectives of the organisation (either through 50% ownership of the entity, or control of the board). Such control must be “real” and effective. The Public Works Act requires the council has control over the construction of the works. This requires that the council has financial responsibility for the works. A CCO model might do this if the control is real and the financial contribution is real.

In my mind, a potential problem is the works will cost $65 or $75 million, yet councils commitment is only $25 million at best. How can council have “real” control or real financial responsibility for works (or even half the works), when the financial contribution of council will never add up to even half the cost of the works? The same could be said of a model that contemplates shifting subsequent ownership to irrigators as more irrigators come on board – which the ownership model already contemplates.

Debt funding of $17 million

At a simple level, joint ownership of the company holding the debt would mean council would be liable for half the debt (and the interest payments). At present, council have only committed to a $25 million contribution. So any additional liability (half the $17 million debt) would be outside any authorised investment by council. Arguably, this could be mitigated by wrap-around-agreements, whereby WCDL underwrite the council’s debt liability (and interest liability).

However, questions then arise about WCDL’s ability to undertake and honour that liability. Not to mention WCDL’s history of not honouring agreements. For example, the recent resource consent funding and support agreement. There is also a question about the debt being used to enable the “appearance” of 50:50 ownership model, when the “real” ownership arrangement is more likely to be less than 50:50 for council. Especially if any debt is underwritten by WCDL (or associated parties).

Moving forward

In my opinion, council is rapidly running out of time to put in place a solution that protects urban water consumers from the new water allocation (and restriction) rules. If a dam cannot be financed under a satisfactory model, then council needs to quickly undertake development of Plan B water augmentation solutions.

WCDL acknowledged in its presentation that there were effectively two options. The first was their proposed joint venture proposal, and the second was a private ownership model, whereby council was treated as just another water consumer (or irrigator investor). The later approach might be where this plane lands if a joint venture is not feasible. If it does, there will still be a number of conditions attached to council investment in a private company model, including security of investment.

A number of problems (discussed above) also draw me to the conclusion that a CCO model probably won’t work, unless government directly tops up councils investment, so that it equals the irrigators contribution (which it is also supporting, through the CIL loan). Anything else will be seen as artificial, and constructed to get around the requirements of a CCO under the Local Government Act, or an improper use of the Public Works Act. The alternative, is the dam company, as a private company (not a CCO), would have to seek government appointed “requiring authority” status to utilise the Public Works Act.

Council resolved to further explore (and test) WCDL’s joint venture proposal and to report back to council.

As I had stated in earlier posts, in my opinion, council should only be committing $14 t0 $15 million, not $25 million. A $15 million investment would reflect: $9 million for current and future urban water needs, $3 million for urban water users portion of the environmental benefit (under an extractor pays principle), and $3 million for investigation and resource consents). Reducing councils investment to $15 million will also reduce any risks for council and the public. As well as place pressure on the government to properly fund this project if it is to be implemented.

In my opinion, much has been made of the economic benefits the dam will provide (see earlier posts). However, it is only the government who is likely to immediately benefit from the dam (through the tax system, that can clip the ticket on an expanding economy from construction and future growth). In contrast, councils main mechanism for revenue raising is limited to land charges (rates). Any improvement from irrigation is unlikely to change councils revenue in a significant way.

I also find it strange that with all the economic benefits being banded about, government has remained silent on any significant investment in the dam. It would appear from government’s silence that they are not convinced the project has merit. For if it did, they would have made a statement already. I did note with interest the comments of Nelson MP (Nick Smith) at the opening of the water treatment plant, that water was considered to an economic advantage over competitors (ie Australia) (see www.stuff.co.nz/nelson-mail/news/73504764/new-115m-water-treatment-plant-opens-at-richmond). If the government believe that, where is the financial investment?

In my opinion, it is not the duty of ratepayers to sustain broader economic growth objectives of business. That is the role of government. Its time for government to step up, if this dam project is going to get across the line!

Surplus treatment

The purpose of this report was to re-allocate the financial surplus that council had achieved for the 2014-15 financial year (ended June 2015). This surplus was the result of actual expenditure for the year being lower than forecast expenditure. Generally, the surplus has been redeployed to debt retirement or other activities. In a number of other instances, the surplus has been left in the original activity, pending further examination.

Overall the surplus was allocated as follows:

  • external debt repayment ($9.243 million),
  • emergency fund ($0.87 million),
  • activity deficit retirement ($0.715 million),
  • carry over projects ($0.539 million),
  • remain with the original activity ($8.253 million, although $2 million requires further analysis).

From a departmental (or functional) perspective, the surplus funds were allocated as follows:

  • Community development: (1) carryover of $100,000 for Saxton field, (2) community housing internal debt retirement of $74,000, (3) parks and reserves internal debt retirement of $13,000, (4) carryover of $150,000 for LED lights in parks, (5) special purpose committee internal debt retirement of $9,000, (6) transfer of $8,000 from community grants to reduce deficit in the community recreation activity account, (7) transfer $358,000 from library activity account to library radio frequency information data project account.
  • Corporate services: (1) apply $117,000 to deficits in governance accounts, and (2) apply $142,000 to deferred maintenance of operational property activities.
  • Environment and planning: (1) transfer $250,000 from compliance monitoring, $100,000 from environmental information, and $56,000 from environmental policy to building control to reduce deficit, (2) carryover $72,000 for environmental information operational projects, (3) debt retirement of $18,000 within environmental information account, (4) Mapua decontamination debt retirement of $500,00 (balance $1.18 million remains), and (5) carryover of $67,000 for the operational projects within the sustainable management acount.
  • Engineering: (1) internal debt retirement of $139,000 in the coastal works account, (2) transfer $600,000 from subsidised roading activity account to general disaster fund, (3) debt retirement of $422,000 in subsidised roading account, (4) debt retirement of $378,000 in non-subsidised roading account, (5) transfer $270,000 from general river account to classified river protection fund, (6) carryover $150,000 from stormwater account to Seaton Valley detention pond, (7) debt retirement of $364,000 in stormwater account, (8) debt retirement of $3.896 million in wastewater account, (9) debt retirement of $2.212 million in urban water account, (10) debt retirement of $456,000 in Motueka water account, and (11) debt retirement of $105,000 in Takaka water account.

Interim remedial storm water measures

As part of this agenda item, I sought to have some of the surplus (roughly $400,000) applied to addressing 5 flooding hotspots in the wider Richmond area, identified during the 2011 flood event. These are spots that are prone to flooding in heavy rain events. The type of work I had contemplated would have been remedial in nature, aimed at mitigating flooding risk, before more substantial investment could be made. For example, joining storm water sink hole sumps (so a stand alone sump overflows into another sump rather than directly onto properties), or clearing and widening creeks (again to avoid overflows or blockages, that result in secondary flood paths).

Unfortunately, I received no support from any other Richmond ward councillors (or any other councillors, apart from Cr Bouillir). In my opinion, this is disappointing, given the communities very strong concerns over flooding risk in the wider Richmond area (as evidence by the community survey). Instead the majority of councillors preferred to wait until storm water modeling was completed in 6-9 months time.

Tourist signs application

Council were asked to consider an original 2014 application (and revised 2015 application) by Mr Reg Turner (owner and operator of a lodge called “Songs of the Tui”) for two MOSAT signs to be erected on the Collingwood Bainham Main Road. MOSAT stands for “Manual of traffic signs and markings” which is published by NZTA (see www.nzta.govt.nz/resources/motsam/). MOSAT signs are a legislatively prescribed sign and can only be used with the approval of an authorising body.

The signs sought to direct traffic along Mackay Pass Road in Golden Bay as an alternate scenic route to the Heaphy Track, and the Salisbury Falls (the Hobbit film site). That application sought to use the words “Song of the Tui – Alternative to the Heaphy Track”.

TDC staff initially declined this application on the basis they did not want to promote Mackay Pass Road as an alternate road to the Collingwood Bainham Main Road. This was because the Collingwood Bainham Main Road was sealed (and Mackay Pass Road was not), the additional risk of directing foreign travelers through a narrow unsealed road that had limited sight distance and some challenging road geometry, when a sealed road was available.

However, Mr Turner was still able to erect his own sign on private property if he did not agree with the decision of council. Such a sign would need to comply with resource consents (if any were required). In Golden Bay, there are many examples of private signs (located on private property) advertising local businesses. This was the advice council staff provided. He could also appeal to the council governance body, which is the reason for this report.

Mr Turner decided to take TDC staff advice, and subsequently approached the council’s roading contractor (Fulton Hogan) to construct a MOSAT sign – presumably with the intention of locating it on private property. Unfortunately, Mr Turner’s actions appear to show that he had not fully understood the staff advice. As that advice also made it clear that a private sign could not replicate the look of an official MOTSAT sign.

The contractor on receiving Mr Turners request, contacted the council (as the authorising body) to confirm approval had been provided – which was standard practice. Understandably, staff did not confirm this approval and the contractor advised Mr Turner that it could not construct a MOSAT sign for him. Mr Turner, considered that staff had interfered with private business activities and told his story to the papers. This was reported in the Nelson Mail on 17 April 2015 (see www.stuff.co.nz/nelson-mail/news/67669478/Golden-Bay-tourism-operator-accuses-TDC-of-blackmail-over-road-sign).

Mr Turner then submitted a revised application on 23 July 2015. In that application, he changed the words of the sign from “Song of the Tui – Alternative to the Heaphy Track” to “Scenic Route via Mackay Pass Road – Heaphy Track & Hobbit Film Site 300 meters”. The application notes that this is the first time a route refers to the Hobbit film site at Salisbury Falls. A copy of this application was sent to councillors on 15 October 2015, for consideration at the 22 October 2015 full council meeting.

Application to facts

Council unanimously declined this application. However, the decision does not prevent the applicant from pursuing a private sign (which is not a MOSAT sign), being located on private property near the locations he sought.

In my opinion, council could not endorse the use of Mackay Pass Road to reach several tourist destinations (the Heaphy Track or Salisbury Falls), when a better (safer) road was already available. This decision was not about promoting (or not promoting) business, this was about council endorsing the use of roads for getting to tourist destinations. As observed above, the applicant’s business was already promoted at the intersections sought under these applications.

MackayPassRd

While I agree that the roads after the Collingwood Bainham Main Road are unsealed, this does not mean that council should promote the use of unsealed roads over sealed roads. Quite the opposite. Council has invested substantial ratepayer funds in providing (and maintaining) a safe corridor to the Heaphy Track and Salisbury Falls via the Collingwood Bainham Main Road. That is the corridor that council has chosen to invest and support. To promote an alternative corridor (Mackay Pass Road), would only invite additional costs for council in the future, without any discernible advantage for council, ratepayers, or tourists.

Mr Turner raised a number of questions in his presentation that I would like to respond too. These observations and opinions are my own.

First, it would appear from the applicants submissions that the underlying reason for wanting the signs was to increase drive by traffic. In the applicants opinion, the tourist should have the right to choose the best path. I would note at this point that the tourist is still able to choose their best path – with (or without) a MOSAT sign. Generally, most tourists (if they are like me) use maps and draw on the presence of signage to confirm they are correctly reading their map. Although, clearly the applicant consider’s the presence of a MOSAT sign, would influence that decision. Which it might.

However, the applicant’s underlying reason for a MOTSAT sign, is not the only consideration council has to consider in approving or declining an application. Council also has to weigh up a number of other considerations (including road safety and cost).

In my opinion directing additional traffic down Mackay Pass Road (other than to find Mr Turner’s lodge) would also put additional pressure on council to make further improvements to this road – to meet any increased usage, especially if there was an accident. I cannot see why council would want to increase the usage of MacKay Pass Road, when it has already invested substantial amounts in sealing (and maintaining) the Collingwood Bainham Main Road. That is the preferred route for council to the Heaphy Track and Salisbury Falls.

While I appreciate, a sign might increase drive by traffic for the applicant, that has to be weighed against road safety concerns and future potential costs for council (and ratepayers). While I also appreciate, the applicant could achieve this end privately, council cannot endorse an outcome that is not in its (and ratepayers) best interests. In this regard, the interests of the applicant have to be weighed up against the interests of the ratepayers (and tourists).

Further, while I am not a marketing expert, I also wonder if increasing drive by traffic past the applicant’s lodge is a good marketing ploy. In my opinion, the applicant might be better off to market his lodge as a return destination (for refreshments or accommodation) at the tourist destinations he sought to promote, rather than promote alternative corridors to those destinations. I think its highly unlikely anyone motivated to get to the Heaphy Track or Salisbury Falls via an alternative route will be stopping on the way (unless they have an accident). I think its more likely that they might consider a stop over on their way back. Perhaps a sign located at the destination recommending the applicants business, is a far better marketing strategy?

Second, the applicant considers the report (at para 4.2) is incorrect in referring to the lodge as the applicant. In his words the “lodge name is not mentioned in [the] application”. I disagree, although I do not see it as material to the decision. In my opinion, it is reasonable to conclude that the lodge was the applicant. This is because: (1) Mr Turner is the owner operator of the lodge, (2) his name appears as the author of the 23 July 2015 application letter (“REJ Turner – Tourism operator”), (3) the 23 July 2015 application letter appears on lodge letter headed paper which contains the email and web address of the lodge.

Third, the applicant considers the report (at para 4.4) is incorrect in referring to “Lord of the Rings” as the film site, when the application refers to the “Hobbit”. I agree. However, councilors received a copy of the 23 July application letter (which correctly referred to “Hobbit Film Site”) on 15 October, several days before considering the report. Accordingly, the original error in the report is not material in the resulting decision.

Fourth, the applicant considers the report (at para 4.8) is incorrect. Mr Turner contends that there is no evidence of incorrect statements to the media. I disagree. Mr Turner is reported in the media article (dated 17 April 2015) as accusing “staff of acting illegally, blackmail and preventing a council contractor of doing business with him”. As discussed above, council have not prevented a contractor from doing business with him. Nor have they blackmailed the contractor as contended. However, they have stopped a contractor from supplying a MOTSAT sign to a person (or business) who was not authorised to use one.

Fifth, the applicant has also stated (page 3 of his submissions) that statements that try to compare sealed roads with gravel roads are not acceptable. He points out that there are a number of gravel roads that lead to tourist destinations and Mackay’s Pass Road is no different to those. I agree. However, unlike those other roads, there is a sealed alternative to Mackays Pass Road that provides a better (and safer) route to the aforementioned tourist destinations.

Sixth, the applicant considers the report (at para 5.3) is not sustained by the facts. The report at para 5.3 contends that a sign endorsing the use of Mackays Pass Road “has the potential to encourage motorists to use a road that has lower standard of maintenance, delineation and safety. Some of these motorists are likely to be international drivers and encouraging these road users to use Mackay Pass Road may lead to crashes involving themselves or with other vehicles. There could also be an increase in maintenance, complaints and requests for more work to be done to improve the low volume road.” The applicant points out that there have been no road incidents on McKays Pass Road, but there have been a total of 7 serious crashes (including one fatal) on the Collingwood Bainham Main Road (4 incidents), Collingwood Puponga Road (2 incidents) and Cowin Road (1 incident), between 2005 and 2014.

First, while I might agree the report does not appear to present all the evidence (that it probably could have), I cannot agree with the applicant’s statement that the report’s conclusion (and recommendation) is not sustained by the facts. A quick survey across the internet will generate a number of articles of road accidents involving tourists on gravel roads. For example www.stuff.co.nz/motoring/66769245/road-kill–must-something-be-done-about-foreign-drivers, and www.scoop.co.nz/stories/PO1504/S00093/most-tourist-accidents-are-preventable-says-report.htm.

In analysis of foreign drivers published last year, it was revealed that loss of control and unfamiliarity with local conditions were the leading causes of accidents (see www.transport.govt.nz/assets/Uploads/Research/Documents/Overseas-drivers-2014-web.pdf). Otago Regional Council has also specifically identified gravel roads and tourists as a cause of serious road trauma in the region and has suggested that “teaching tourist drivers how to drive on gravel roads: targeting drivers aged 25 to 34 years, in particular, and/or sealing roads commonly used by tourists” are means to mitigate this concern (see www.orc.govt.nz/PageFiles/1404/April%202015/Report%203a3%20-%20road%20safety-%20tourist%20drivers%20-%20with%20cover-%20%20%20LATEST%20PDF.pdf).

These reports alone, support the conclusion that the reports observations (at para 5.3) are sustained by facts. Albeit, not presented in the report.

Second, the applicant fails to appreciate that the current statistics for Mackay Pass Road are based on existing usage. In my opinion the applicant’s comparisons are misleading, as it suggests that a low crash rate would continue on Mackay Pass Road after road usage increased – which is the underlying purpose of the application. In fact, it might be suggested that the crash rates on the other three roads are in part due to higher road usage, and could well be worse, if road improvements (like sealing and geometrical changes to the road) had not been made. Unlike the applicant, I find it difficult to take any meaningful conclusions from the crash rate data, in terms of justifying increased usage of Mackay Pass Road.

Seventh, the applicant considers the report (at para 6.2) which stated “there are, however, risks in installing a tourist sign directing motorists along a route that has some geometric deficiencies. The local community is aware of these issues and drive accordingly whereas unfamiliar drivers may not” – is silly. I disagree. In my opinion there are risks (see preceding observations).

Eighth, the applicant considers the report (at para 7.1) ignores other operators who have placed signs up. In my opinion, the actions of other operators is not material to the decision, which must weigh a number of considerations. The actions of other operators is not one of them (especially if they are illegal). Nor is the failure of council to ensure compliance. However, if other operators are acting illegally, then council should be making proper investigations to correct this situation, now that it has been brought to its attention.

Ninth, the applicant considers the report (at paras 8.1 and 8.2) to be untrue and disputes the estimated costs of making and installing a sign ($1,700) or the cost of road improvements (above $40,000) over the 19km road. Unfortunately, these are the costs that council often face and why it is important to ensure council costs are contained if we want to keep rates costs down. To put the estimates into perspective, the average cost of road sealing is roughly $5,000 per km. Although this is figure is itself dependent on a number of other considerations.

As an aside, an interesting report on the cost of roading infrastructure in NZ is located at www.transport.govt.nz/assets/Uploads/Research/Documents/NZIER-report-2013-construction-industry-performance.pdf.

Tenth, the applicant considered the statement in the report (at para 9.1), that the issue had low significance “because it is a local issue being promoted by one landowner”, was not true, because tourism benefits the whole community. While the applicant’s statement has some general truth behind it (and the reason why council has decided to promote destination tourism on behalf of the region), I cannot agree that there is any evidence of measurable financial benefit from the applicant’s efforts in promoting the road as a scenic route in the manner contended. The burden of proof is on the applicant, and no evidence is provided in his submissions (or application) to support his conclusion.

Finally, the applicant considered the report’s conclusion (at paras 10.1 and 10.2) is speculative and not sustained by facts. In my opinion, these are concluding remarks from points made out in earlier parts of the report, and have been addressed above in this opinion.

In conclusion, while I have every sympathy for the applicant’s position, having considered the evidence and surrounding facts, I could not support the application. However, as stated above, this does not prevent the applicant from undertaking construction of different signage on private property, or exploring the promotion of his business from the destinations themselves.

Reserve classification

Rabbit Island (Motorua), Rough Island, and Birds Island are Crown owned reserves. Under the Reserves Act 1977, all reserves must be classified. Classification of reserves needs to completed before doing a reserve management plan. Before 2013, the minister of conservation was responsible for classification. In 2013, the minister delegated this task to local authorities. Local authorities are also tasked with preparation of management plans for reserves as the administering body.

It appears that formal classification of Rabbit Island (Motorua), Rough Island, and Birds Island under the Reserves Act 1977 has never been undertaken or completed. Although the existing management plan (first drafted by council in 1989 and updated in 1997 and 2001) has repeatedly stated (at para 2.3) that “classification is being undertaken as required by the Reserves Act 1977 … part of the land is to be classified as “recreation” and the reminder is to be classified “local purpose (plantation)”. A full history of the management of the islands is contained in the agenda report.

The administering body (council) can prepare an advance draft of a plan covering unclassified reserves for which it is the administering body, provided this does not pre-empt the classification process. However, the administering body cannot, invite public submissions on the draft plan until all the reserves which it covers are classified and the draft plan is consistent with those classifications (see www.doc.govt.nz/about-us/our-role/legislation/guides-and-bylaws/a-guide-for-reserve-administering-bodies/chapter-11-management-planning-for-reserves/questions-about-management-plans/).

For any unclassified reserves, the management plan will only have the status of an advance draft. This means that any policies or rules for managing unclassified land cannot be enforced, as they will only have a draft status. In addition, the Reserves Act (s 16(6) and(7)) appears to suggest that unclassified reserves are to be treated as recreation reserves until classified. This suggests that the forest plantation on the island should be administered as a recreation reserve, not a “local purpose (plantation)” reserve.

The net effect is that the current management plan cannot impose “local purpose” rules on the island’s forestry plantation. At best it appears it can only impose recreation reserve rules on land used for forestry. To correct this administrative oversight, formal classification of the forestry plantation was required.

Given this oversight, council resolved to complete the classification process, so that a valid (enforceable) management plan could be implemented. To avoid unnecessary consultation costs, a non-notified process would be undertaken (subject to consultation with iwi, given its crown land).

As discussed above, Max Clarke questioned the purpose of classifying the reserve at this time. I imagine part of the reason for his position is because a similar reclassification process occurred in the Queenstown region with the stated purpose of enabling land swaps (see www.qldc.govt.nz/assets/Uploads/Your-Views/LLS/Lakeview-Land-Swap-Summary-of-Proposal.pdf). In that situation, the Queenstown regional council (QRC), undertook to reclassify reserve land so that it could be swapped with other land of a similar classification. A similar land swap arrangement was also proposed for the Ruataniwha-dam (see www.stuff.co.nz/dominion-post/news/72700495/doc-approves-land-swap-paves-way-for-ruataniwha-dam.html).

[Update! The Ruataniwha-dam land swap arrangement is now subject to an appeal (www.stuff.co.nz/business/farming/74863647/land-swap-for-ruataniwha-dam-illegal-forest-and-bird).]

According to the QRC report:

The Department of Conservation guidelines for administering bodies suggests it is mandatory to classify a reserve under the Reserves Act before public notification of a draft management plan, but desirable before exchange of land or granting a major lease.

The requirements of the Reserves Act state that land becoming reserve land must be held for the same “purposes” as the land being exchanged. The purposes of a recreation reserve are:

“providing areas for the recreation and sporting activities and the physical welfare and enjoyment of the public, and for the protection of the natural environment and beauty of the countryside, with emphasis on the retention of open spaces and on outdoor recreational activities, including recreational tracks in the countryside”.

There is no requirement that on exchange the particular use must remain the same, as long as any change in use remains within the general purpose of the reserve classification.

To address Mr Clarke’s concerns the mayor declared that he had not been involved in any discussions concerning the swapping Rabbit Island forestry land for land in the Lee Valley.

While I took comfort from the mayor’s statement, and the underlying administrative purpose of reclassification (discussed above and with council staff before the meeting), I thought the timing for completion of the reclassification (September 2016) was an interesting coincidence. In my opinion, it would also be political suicide for a mayor or MP (given its crown land), to contemplate a land swap with Rabbit Island. There would be a public revolt.

Queen street reinstatement

As part of council’s strategy to address central business district (CBD) flooding risk, council propose to make improvements to Queen Street. This involves extensive excavation of the road and footpaths (from shop front to shop front) between Salisbury Road and Gladstone Road. The aim is to enable Queen Street to be a secondary flow path for storm water by reducing the level of the road. The project also provides an opportunity to evaluate whether changes should be made to this stretch of road. For example, wider footpaths, cycleways, bus lanes, etc.

Council resolved to receive the report and approve staff to engage with the community on amenity aspects of the project and report back following consultation.

I took the opportunity to reinforce to staff that the cost of the reinstatement should not be more than what it would cost to replace what is already there. If new things could be done within this financial cap, then council were open to the opportunity, subject to community feedback on such ideas. What I did not want to see is some councilors seeing this as a legacy opportunity and go on another spending spree (which is what has happened in the past).

Mayor’s report

I do not normally discuss the mayors report as there is not usually much in it. However, I do want to mention two items.

Climate change declaration

The first is in relation to the local government leaders climate change declaration. The declaration letter acknowledged the importance and urgent need to address climate change for the benefit of current and future generations. The letter also set out a number of commitments councils would support, as well as councils expectations of government (see www.lgnz.co.nz/assets/Mayors-Climate-Change-Declaration.pdf).

The mayor had written to councillors before the full council meeting advising them that he had decided to not affix his signature to this letter because of the potential cost to council in supporting some of commitments councils were signing up to. For example, supporting the use of electric cars.

I responded to the mayors email suggesting that it should be for council to decide, rather than the mayor. This was because the letter referred to the mayor’s signature as “signatories from councils”. As a signatory for council (which is what the letter suggested), council should consider the opportunity of supporting the declaration (or not).

I also noted that the tenure of the letter was to “support”, not undertake. The letter says “support” not “commit to buy”. “Support” can be passive or active. I’d be surprised if council could not “support the use of renewable energy and uptake of electric cars”. In fact, we already support renewable energy (through purchase of solar panels on the aquatic centre). And I’m sure if there was an application to install a recharge station (for electric cars) in Tasman, council would support such a venture. Its only a matter of time before petrol stations begin rolling them out.

I invited the mayor to reconsider his position and at least invite council to vote on councils representative (being the mayor) signing the declaration on councils behalf. To his credit, he did this. A show of hands was called and the majority of councillors supported the mayor’s position. Cr Ensor, Bouillir, and myself, did not. The essence of our argument (articulated very well by Cr Ensor) was council needed to show some leadership on the challenges of climate change for local government. My argument (as stated above), was that support did not have to translate to any cost for council (unless it chose to do so). In my mind, any financial support had to make commercial sense and be fiscally prudent.

Aniseed toilets

The second is an issue raised by a Richmond resident. The mayor’s report offers the opportunity for councillors to raise any issues not on the agenda. It was mentioned by a resident that the aniseed toilets were in a poor state. There was often no toilet papers or running water to wash hands. And the toilet was not pleasant to use. The resident had stated that they had raised the issue with the mayor and Cr Edgar sometime ago, but had not heard back.

I asked the mayor (and Cr Edgar) if they were aware of any progress. Neither recalled this issue. I have since followed up the issue with staff who have undertaken to contact the Department of Conservation (DoC) who are responsible for this toilet. Staff have also undertaken to audit other council toilets in the Aniseed valley. I hope to report back to the residents soon.

CEO report

Economic development

Nelson council has considered the funding agreement adopted by TDC on 10 September and have proposed some minor wording changes. The agreement has been referred to the transition group (who are reviewing the proposed merger of the EDA and NTT).

At the recent Joint Council meeting (held on 3 November 2015), I spoke to a few Nelson councilors and reiterated that this was the funding level Tasman council currently supported. However, the real issue was not the level of funding, but agreeing on measurable performance targets for this organisation. Council needed to be able to see that their investment was returning something financially tangible that was sufficiently connected (and traceable) to the funding. If council could see that the investment did directly result in improved financial outcomes, then it might be more willing to invest more.

For example, current indicators, like increased spend in town centres, does not necessarily mean it is coming from tourists or marketing initiatives. It could be coming from residents visiting those centres. The same criticism could be made of the EDA. Better measures and analysis is required.

Elections for 2016

Planning for local body elections has begun.

I would like to offer the opportunity for people considering standing for council in 2016 to contact me to talk confidentially about what council involves and what can be expected. I am hopeful that a number of people will put their hand up in 2016. In my opinion, a healthy council is one that continues to bring in new ideas and thinking, rather than returning the same people, with the same ideas. This can only happen with significant change around the council table. Change also avoids organisational capture.

Finance

For the quarter ended September 2015 (for the 2015-16 financial year), an accounting surplus of $2.394 million (compared to a budgeted surplus of $1.378 million) has been achieved. A positive accounting variance of $1.016 million.

On a year to date basis, expenditure is $2.866 million below forecast budget (mainly due to less than expected expenditure for emergency works, general maintenance, and finance costs). In addition, income is $705 million above forecast budget (mainly due to library insurance proceeds being received (and used for the Mapua development), timing of dog registration fees, external lotteries funds for Motueka recreation centre, and civil defence funds for Rameka creek claim). The net result is a $3.57 million operational surplus.

Year to date capital expenditure is $3.838 million. Overall, capital expenditure is budgeted at $34.315 million (plus carry overs from last year) for year end.

Debt is currently $146 million (lower than the forecast $173 million disclosed in the LTP).

People

Since the last report 5 appointments (internal transfer or replacement) have been made. Three resignations and 2 retirements have been received. TDC is currently recruiting for a strategi policy manager. For the quarter ending 30 September 2015, staff turnover was 1.12%, staff numbers were 242 FTEs (made up from 267 full-time and part-time people).

TDC has also been selected (after applying) to be part of the high performance work initiative programme offered by Callaghan Innovation (see www.callaghaninnovation.govt.nz). In my opinion, this is an exciting opportunity for the organisation.

Health and safety

Cosman Parkes have been engaged to complete a health and safety review of the council’s activities. A workshop (on 12 November) will be developed to report back to council on their findings and recommendations.

Best Island update

Two land valuations have been received – one based on the subdivision value (Ashford’s). Negotiations will begin soon.

Tasman wharves

Council resolved to receive the reports on historic wharves and small wharves in the Tasman region (mainly in Golden Bay) and agreed to consider at no cost to council (for historic wharves), or from reserve financial contribution (RFC) funds (which compete with other reserve projects) for small wharves, the establishment of local trusts to acquire and manage such wharves.

Agenda and minutes

The agenda and minutes are located at www.tasman.govt.nz/council/council-meetings/standing-committees-meetings/full-council-meetings/?path=/EDMS/Public/Meetings/FullCouncil/2015/2015-10-22.

 

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Full council meeting (10 September)

The full council meeting was held on 10 September 2015. All councillors were in attendance.

The agenda included: (1) treasury policy change, (2) capital carry-overs, navigation safety by-law, (3) public transport regional plan, (4) speed limits review, (5) unmanned aircraft policy, (6) Nelson regional sewerage business unit, (7) economic development funding agreement, (8) mayor’s report, (9) Waimea community dam, and (10) CEOs report.

Two additional late items were also considered in confidence: (1) audit subcommittee independent member appointment, and (2) Waimea water augmentation project. I’m unable to talk to these items at present, as they were discussed in committee and have yet to have their confidential status lifted.

Finally, two items were raised in public forum – with one raising a very interesting legal issue.

Public forum

Michael Croxford raised (and tabled) an interesting question regarding the treatment of development contribution levies by the council. By way of background, a developer (being the “consent holder” at the time the development is approved) will normally pay the council a development contribution. This financial contribution helps fund downstream infrastructural impacts from the development or proposed infrastructure that the development would benefit from.

In some instances council might decide not to proceed with implementing proposed infrastructural improvements. In those instances, council refunds the financial contribution to the consent holder (the original payor). In this instance, the Motueka coastal pipeline was removed from the long term plan requiring council to refund the development contribution. In some instances the original developer (the “consent holder” at the time) is no longer operating or has been liquidated. If it is a company it is normally removed from the companies register. However, removal from the companies office does not prevent a company re-registering.

Michael argued that the refund of development contributions, should go to the holder of the consent at the time it is deemed no longer required. Accordingly, where the developer no longer exists, the refund should go to the land owner as the subsequent holder of the consent. Essentially, his argument turned on whether the term “consent holder”, could import a wider meaning from examining other provisions of the Local Government Act (LGA) or Resource Management Act (RMA).

This matter was subsequently discussed during the Mayor’s report. The outcome of that discussion was that the council felt it had discharged its duty to determine (to the best of its ability) the legal position. That advice suggested that the “consent holder” was the payor (the original developer) and did not include the subsequent owner of the developed land. As Michael had not received a copy of the council’s legal opinion, it was felt that he should be provided a copy, so that he (and other residents) could decide whether they wanted to challenge the council’s legal advice.

Kit Maling spoke to the Waimea community dam update report (discussed below) and tabled a document outlining a resolution from the Waimea East Irrigation Company.

Waimea community dam

This item was a second (regular) project update for councillors. At this stage the project has been in slow mode (to avoid unnecessary expenditure) as discussions with WCDL progressed. The confidential briefing to councillors, updated much of what was stated in this part of the report. Once discussions with WCDL have been completed, planned work streams should move forward a little faster. The proposed work streams were outlined in my earlier post (see www.greeningtasman.wordpress.com/2015/09/08/full-council-meeting-30-july/).

Work that can be expected to re-gather momentum once discussions with WCDL have concluded are:

  • formation of a biodiversity technical advisory group (BTAG) to prepare a biodiversity management plan (a resource consent condition).
  • construction procurement process planning. It is being suggested that a two stage process (that comprises construction and design planning, followed by price negotiation and construction).
  • business structure planning. WCDL has been considering a variety of options (prepared by Northington partners). Staff will present a report to full council in October that considers the various issues.
  • preparation and review of pre-purchase agreements with landowners. These are agreements that hold open the ability to purchase the relevant land (at agreed prices), without actually entering into land sales. Effectively, the council avoids having to purchase land until there is agreement to proceed with a dam.

By way of background, WCDL acknowledged council’s recent offer to share the resource consent as joint resource consent holders (a 50:50 ownership arrangement). This is a change from councils original arrangement, where WCDL were contracted to secure the resource consent on behalf of the council and handing over the resource consent by a specified date or the formation of a CCO (which ever was earlier). WCDL has attached several conditions to this offer which council representatives have since brought back to council. Hence the confidential session.

I would hope that once all discussions with WCDL are completed, that relevant reports withheld under confidentiality are made public. I will certainly be advocating for this to happen.

So where to from here?

In my opinion, the process is at a critical fulcrum (or tipping point). I believe council needs to re-evaluate its relationship with WCDL. It has become very confusing and the lines between council and WCDL are very blurred. This has resulted in a great deal of uncertainty (and confusion) about who should be doing what, and who should be funding what.

At present council is both (sole) funder and service provider. Council is carrying all the risk (hence the growing concerns of council about the escalating write-off cost). Those roles need to be formally separated. Council should no longer be the sole funder and certainly not the main funder of a water solution that is being developed for the primary benefit of irrigators (who will receive over 2/3rds of the augmented water supply).

In my opinion, (as I have said repeatedly on this blog), WCDL needs to capitalise (as an investment holding entity for interested irrigators), so that it can take over this project as majority shareholder and funder of the dam. Like all investment vehicles, it needs start up capital to come from those investors who truly believe in this venture.

Once initially capitalised, WCDL can invest in developing a prospectus to secure more funding from potential investors to eventually invest into a Dam holding entity. The dam holding entity can then fund the services (and work streams) it needs to bring about the construction of a dam. Council can then evaluate whether it wants to invest in the venture or not. And can also compete against others, to provide project management services and technical expertise.

The parallel issue of water allocation and restrictions

Unfortunately, one of the most frustrating elements of the dam debate for me, is the confusion surrounding the water management (allocation and restriction) rules – which are set to change. Hardly anyone I speak to understands how these rules operate or how they impact on the way water is currently managed.

In my opinion council has done a very poor job in communicating the changing landscape of water management. This should have been communicated by council well before it began its conversation about water augmentation. Because this is “the” reason why council is having a debate about water augmentation solutions. Ironically, council were the ones who brought about these change in the rules, by way of a plan change a number of years ago.

However, the good news is that council has got its act together and is beginning to have this conversation. As part of the consultation process for proposed changes to the district plan rules, council will be hosting 2 open days for residents to meet and discuss the proposed plan changes. These are:

  • Wednesday, 7 October 2015 at Richmond Council Chambers (focusing on urban water supply), and
  • Thursday, 8 October 2015 at Seifried’s Estate, Redwood Rd (focusing on rural water permit holders).

Changes to water management rules

There are three changes to the water management rules.

First, water allocation is about to change. Basically, the amount of water people receive is likely to reduce. For example, people might have received a water allocation right of 10 litres, but only actually consumed 5 litres. This resulted in an over allocation of water. To correct this over-allocation, council will be reviewing peoples actual water usage. The review will re-calibrate water allocations so that they equal actual usage.

This re-calibration will also have an immediate affect on the impact of water restrictions on some water right holders. This is because water restrictions step down from the allocation right volume. If the allocation right volume was higher than real water consumption volume, the restrictions had no impact on water right holders. However, if the allocation right volume is the same as consumption, then restrictions will immediately affect the amount of water available for the water right holder.

For urban water users the allocation right volume is virtually identical to consumption. Effectively council has not purchased more water than it needs. Whereas, some rural water consumers have. This means any re-calibration of urban water will not result in any change.

The second change is the threshold for imposing water restrictions. The thresholds have changed (by way of an earlier plan change) so that they bite earlier (ie, at lower thresholds). These changes are even more severe for water users who will have their water allocation levels reduced to historical consumption levels (or use).

The third change (currently being consulted on) is the introduction of a dual water restriction system – one for those who are allocated water and are funding an increase in water supply (a dam funder), and one for those who are not. Those who choose not to fund an increase in water supply, will operate under the above rules (ie, the revised allocations that are equivalent to historical use, and lowered thresholds for water restrictions).

Those that fund a water supply increase, will effectively have a system that imposes water restrictions that take into consideration the additional water being added to the natural water supply. Effectively, using a different water restriction threshold, so that they can extract the water they have added to the river, before restrictions apply.

If council purchases water from the dam for urban users (estimated investment of $9 million) then they are less likely to see water restrictions. It should be noted that council has voted to provide $25 million towards the dam. With $13 million (of that $25 million) considered to be the environmental benefit contribution that will be rated across the whole district, against water club members (those people connected to a council provided water supply).

As I have said in earlier posts, I consider that the $13 million should be apportioned between the extractors (urban consumers and irrigators), rather than imposed across the district. Adopting an extractor pays approach would have resulted in council only contributing roughly $14 million towards water augmentation, rather than the $25 million that council has undertaken to provide in the LTP (see www.greeningtasman.wordpress.com/2015/06/02/long-term-plan-meeting-full-council-28-may/). In my opinion, the community should continue to put pressure on the councils (majority) decision to fund $25 million of the dam cost.

Speed limits

The council unanimously agreed to release for public consultation the draft consolidated bylaws on road speed limits for the district (see the “attachments” document at www.tasman.govt.nz/council/council-meetings/standing-committees-meetings/full-council-meetings/?path=/EDMS/Public/Meetings/FullCouncil/2015/2015-09-10).

A number of changes to road speed limits across the district are proposed. For example, Ranzau Road will have its speed limits reduced. Consultation is expected to begin from 14 September 2015 to 16 October 2015.

My advice for people wanting to a submission is to read the attachments document. This is because the attachment document highlights the proposed changes (via track changes), so that you can quickly identify any proposed changes. While the public consultation document will highlight if a speed has gone up or down, it won’t indicate the speed it has changed from.

The attachment document also includes very detailed assessments and reasons for why speed limits were proposed for changed (or not). Those assessments include a recommended speed (based on model), additional staff assessments (that consider aspects not included in the speed modeling), and the working party recommendations (being Crs Norris, Dowler, Higgins, Bryant, and Sangster).

In relation to school zones, the draft bylaw proposes a managed roll out of advisory signs. The only exception is for Brightwater, where the Brightwater school zone will have the benefit of a reduced speed limit. This was achieved by the mayor proposing a separate resolution that proposed a speed limit reduction for the main road in Brightwater. A number of councillors were upset with this move, as it appeared to give special treatment to one particular street (and school).

While, I could agree with those councillors, that this treatment was not fair, I nonetheless supported the separate resolution, as at least one school would benefit from the proposed speed reduction. However, I agree with those councillors who opposed the mayor’s maneuvering, that all other schools zones should have had similar treatment. No doubt those schools will be making a submission to council highlighting the difference in treatment and inviting council to lower speed limits on their roads.

Treasury policy

Council’s current treasury policy requires any interest rate swap arrangements that are longer than 10 years to be approved by full council (which meets every 6 weeks). The proposed change sought to extend the delegated authority from 10 years to 12 years, to enable staff to take advantage of the swap market (which is very fluid at present), without having to wait 6 weeks for approval. Both the full council and corporate services meeting unanimously supported the proposed change.

This item was brought to full council from the corporate services meeting (held on 3 September) as the corporate services committee did not have authority to amend the treasury policy. This item was explained in detail at para 9.4 of the corporate services agenda (see www.tasman.govt.nz/council/council-meetings/standing-committees-meetings/corporate-services-committee-meetings/?path=/EDMS/Public/Meetings/CorporateServicesCommittee/2015/2015-09-03) and discussed in an earlier post (see www.greeningtasman.wordpress.com/2015/09/08/corporate-services-committee-3-september/).

Capital carry-overs

Due to the nature of capital works, some projects planned to be undertaken in earlier financial years are either not started, or are not completed in the financial year they were planned. Often delays are due to weather or the cascading effect of other projects being delayed. This means funds that were allocated in an earlier financial year have to be brought forward into this financial year to enable the work to be completed or started.

Council unanimously supported the carry forward of $14.853 million from the 2014-15 year into the 2015-16 year. This does not have a financial impact in the 2015-16 year, as the funds for these projects has already been raised in the earlier years that these projects were planned to be completed. In the previous financial year, council carried forward around $20 million of capital projects. The reduction in carry forwards this year would suggest that council has made some progress in catching up on the delivery of these delayed projects.

A list of the projects being carried forward is listed in the agenda at page 15 to 23.

Navigation safety

Council unanimously adopted the proposed “Navigation Safety Bylaw 2015” which comes into effect on 14 September 2015. The new 2015 bylaw replaces the old 2006 bylaw. All bylaws are located on the council website at www.tasman.govt.nz/policy/policies/bylaws/.

The new 2015 bylaw is the result of a review of the old 2006 bylaw that began in December 2013 and involved public consultation during early 2014. During that consultation period council received over 212 submissions.

Since the consultation period the government has further simplified the law. This has meant that the new 2015 bylaw does not have to reproduce all the rules contained in the parent Act. Therefore, anyone referring to the Navigation Safety Bylaw 2015 should also consult the parent Act (the Maritime Transport Act 1994, see www.legislation.govt.nz/act/public/1994/0104/latest/whole.html), associated regulations, and rules.

Public transport

The regional public transport plan for 2015-18 was received and adopted by council.

I took the opportunity to reinforce the communities concerns that the regional plan is not used to drive (forgive the pun) further road widening projects (Wensley Road comes to mind). In my opinion, any expansion of the public transport network needs to utilise existing infrastructure not place additional financial costs on the community.

For example, a loop around Richmond that uses Hill Street, Hart’s Road, and Bateup Road (which is already earmarked for widening due to the proposed supermarket development) would be more appropriate roads to use as they have the capacity to take buses.

Unmanned aircraft

This topic was discussed in an earlier meeting (see www.tasman.govt.nz/council/council-meetings/standing-committees-meetings/corporate-services-committee-meetings/?path=/EDMS/Public/Meetings/CorporateServicesCommittee/2015/2015-09-03).

Full council received and approved the interim policy on unmanned aircraft (also referred to as drones, model aircraft, remotely piloted aircraft systems, or UAVs). The policy should be read in conjunction with the civil aviation authority (CAA) rules (which came into force on 1 August 2015) and are located at www.caa.govt.nz/rpas/.

The council policy document is is located at www.tasman.govt.nz/policy/policies/flying-drones-and-other-unmanned-aircraft-over-council-land/. Essentially, the policy prohibits use of unmanned aircraft within 4 km of identified aerodromes (controlled airspace), unless permission is granted by the council.

In contrast, council has provided general consent to use unmanned aircraft on all other council land, unless prohibited. Prohibited land areas include: council offices, libraries, forestry plantations, Mapua commercial precinct and wharf area, various public and memorial gardens (such as, Washbourn, Pethybridge, etc), cemeteries, Motueka sandspit, leased land to other parties (such as, bowling greens, tennis courts, etc). If on doubt contact the council.

This policy does not cover privately owned land. However, the CAA requires unmanned aircraft operators to obtain permission from a private landowner or occupier before flying over private land.

Nelson regional sewerage business unit

Council agreed to renew the Nelson regional sewerage business unit (NSRBU) memorandum of understanding and reappoint the joint committee that administers the NSRBU.

This item came before full council because both councils failed to enter into a renewed memorandum of understanding before August 2015, resulting in the deemed discharging of NRSBU joint committee. The council’s resolutions effectively corrected this administrative oversight.

Economic development funding

Council received and approved the EDA funding agreement with Nelson council. The agreement looks to fund destination tourism and economic development initiatives for the Tasman region at a total cost of $400,000 per annum. These funds come from general rates. Nelson council will use the EDA and NTT (or other appropriate vehicle) to provide these services (and outcomes).

I note that the Nelson council has begun a review of both organisations and is not proposing to merge both entities (see www.stuff.co.nz/nelson-mail/news/71888656/Nelson-economic-development-and-tourism-merger-could-save-100-000-a-year). I certainly support a merger as I have stated in earlier posts (see my discussion about tourism at www.greeningtasman.wordpress.com/2013/12/18/full-council-meeting-5-december/).

The council also established a liason group (comprising the mayor, Cr King, Bryant and Edgar) to improve accountability arrangements for service delivery for the Tasman district. In my opinion, this is an important element of the new process. Unfortunately the council in the past has not provided clear targets or outcomes for the Tasman district and therefore has struggled to receive anything meaningful in terms of measuring its return on investment.

While attempts had been made to target the cost of destination tourism to the commercial community (being those who directly benefit), rather than general ratepayers, the tools available to council were rather blunt (ie rating commercial land), and in the end the council opted in the interim to continue to use the general rating system.

CEO’s report

Highlights of the CEO’s report include:

  • strategy and planning. Council’s LTP consultative document was judged to one of the top 8 documents in the country. Council staff are reviewing the winning entry (and the other 6 documents) to make improvements for future consultation documents. Planning for the next financial year (including how we will consult with the public) has begun. A workshop was held on 3 September that discussed several issues including enabling the finance team to focus on forecasting (for the future), rather than just reporting on the past.
  • annual report. The annual audit process went more smoothly this year, with the annual report expected to be adopted at the next full council meeting on 24 September 2015. Appointment of an independent member to the audit subcommittee was addressed in a confidential session with the appointment being made by majority vote. The person appointed was Graham Naylor.
  • rules reduction taskforce. The government task force concluded that there were few loopy laws with many grievances stemming from service delivery and process problems. My experience has been that the interpretation of legislative rules by central government agencies is also an area of concern, especially in relation to health and safety standards (and there over zealous application).
  • people. Council are currently seeking 3 staff replacements. Collective employment agreement bargaining concluded with the union in August. This resulted in a wage increase of 1.2% for most staff – which was “just” within budget. A high level review of councils existing health and safety systems and processes has begun, with a view to implementing an improvement plan. Under the new Health and Safety Act councillors and officers have a duty of due diligence (ie taking reasonable steps to ensure compliance), but cannot be prosecuted for non-compliance.

Agenda and minutes

The agenda, attachments, and minutes are located at http://www.tasman.govt.nz/council/council-meetings/standing-committees-meetings/full-council-meetings/?path=/EDMS/Public/Meetings/FullCouncil/2015/2015-09-10.

 

Nothing like a little controversy

The Dam

The full council meeting on 19 February 2015 will be discussing the Waimea Community Dam and the use of the CCO. Those with an interest should read the agenda. This should be posted live on Monday (16 February) at http://www.tasman.govt.nz/council/council-meetings/standing-committees-meetings/full-council-meetings/?path=/EDMS/Public/Meetings/FullCouncil/2015.

Speaking of the Dam. There are many sources of crop failure. Drought is one. But it appears climate change is also bringing other extreme weather events that are just as likely to wipe out crops (see http://www.stuff.co.nz/business/farming/cropping/65718201/storm-destroys-central-otago-apples).

Amalgamation?

In the immortal words of the castle, “they’re dreamin” (see https://www.youtube.com/watch?v=dik_wnOE4dk)

Amalgamation in 2018? Really?

In my opinion, we need more back room co-operation and synchronisation of operational systems and functions to make it cost effective. Given the experiences of dealing with NCC to date, that won’t happen in the time they have suggested (see http://www.stuff.co.nz/nelson-mail/news/66138524/Plan-for-citys-future-laid-out).

Amalgamation is not a panacea. Empirical research suggests the opposite (http://press.anu.edu.au//agenda/015/01/mobile_devices/ch05s04.html).

Tourism

An assessment of the Economic Development Agency, Nelson Tasman Tourism and Uniquely Nelson is being undertaken by NCC in its long term plan. This could lead to the creation of a single agency with an integrated approach to promoting and growing the city. I think I suggested this in a blog sometime ago and certainly endorse this direction.

Traffic lights and pedestrian crossings

I’ve never been in favour of traffic lights.

Nobody likes to stop. And that makes traffic lights or pedestrian crossings, quite dangerous for people.

In my opinion, roundabouts are more efficient and much safer.

Cars don’t race towards roundabouts, as they do amber traffic lights, and that can only be safer for pedestrians and cyclists.

Plus, with roundabouts, drivers get to self regulate, rather than wait for a pre-programmed computer program to run through its pre-determined light phases, that is unable to know if cars are present or not.

But what if we made pedestrian crossing more fun … could that make them a little safer … https://www.youtube.com/watch?v=SB_0vRnkeOk

Freedom camping

I always found the title ” freedom camping” to be a very misleading label, given the attached conditions in the law.

On that note it’s interesting to read about other councils grappling with the same rules and their enforcement (see http://www.odt.co.nz/news/dunedin/332815/call-follow-resort-freedom-campers).

The Annual Plan – Full Council meetings (30 May, 5 June, and 30 June)

A full council meeting was held on 30 May 2014 and subsequently carried over to 5 June 2014. There were no apologies for the 30 May meeting. However, apologies from Cr Canton were received for the 5 June meeting.  The annual plan was then finalised by full council at the 30 June 2014 meeting.

The 30 May full council meeting was the official meeting to discuss the final cut of the 2014-15 annual plan and any expenditure that would be undertaken (or not) during that year. And an opportunity to take on board feedback on the draft annual plan circulated earlier in the year to the community. The agenda was to consider the following big items: Motueka library, Golden Bay service centres, Golden Bay recreation centre, Tourism funding, and Cycle trail extension – as separate resolutions, with a single resolution for all the other items.

However, before this meeting, several workshops had already been held in the preceding weeks to consider submissions, debate the issues, reconsider positions, and provide the opportunity for like minded councillors (or blocks of councilors) to strike any deals. Therefore, this meeting was to a large extent a formality, but for some councilors like myself, it was also the last opportunity to convince others around the table to change their minds.

Day One – the debt grenade

The full council meeting on Friday (30 May) was to be the big day when we would confirm council’s expenditure program for the forthcoming financial year. Things began, as outlined in the meeting agenda, with the Motueka library proposal leading the discussion.

Motueka library

All councillors were in support of removing the $1 million refurbishment of the Motueka library from the draft annual plan. Why it was ever included in the draft annual plan remains a mystery to me – given the lack of support it had around the council table before the draft annual plan was released. Yet the majority of councilors still voted for it to be included in the draft annual plan. Yet here we were, listening to the same arguments and now agreeing to remove it. Was it’s inclusion in the draft annual plan (and eventual removal in the final plan) just a straw-man for something else?

I for one, thought it should have been removed form the draft annual plan (and deferred for consideration in the long term plan), in the same manner the Golden Bay recreation centre was. This would provide the community a transparent and clear direction from council about what projects were to be deferred, and importantly, why.

Generally, the argument around the table during pre-draft annual plan workshops was that a redeveloped hub in Motueka (that included a service centre, library, and other council services) in one location on Decks reserve, was the way to go. I certainly agree with that direction, as it consolidates overhead costs for a number of council services. But the archilles heel for the hub project was its cost. It was just too expensive, at a time when council needed to be taking stock of its debt position. In my mind, the time was not right to undertake such a project and the prudent step was to consider this project (and others, like the Golden Bay recreation facility) as part of a longer term strategy.

The alternative to the hub concept was to invest $1 million in a refurbishment of the existing Motueka library – that included minor expansion of space and earthquake strengthening. This was the proposal that eventually made its way into the draft annual plan. However, on the day, councilors agreed that this work was also not a good idea. It was felt that the earthquake work would not be required given the governments announcements that it was reducing the earthquake strengthening standard from 66% to 34%. Furthermore, some councilors around the table felt that investing any more funds into a building that was on leased land, was not desirable.

Rather it was better to invest any funds in a hub concept on land owned by council. Finally, it had been noted in earlier reports to council that book useage at the Motueka library was in decline and the use of web based services (eg ebooks) was trending upwards. In light of this trend it was unclear whether the pressure on space within the library was also in decline – and perhaps more time was required to see how this trend would impact on future spacial needs. Accordingly, it was decided to reduce funding from $1 million to $76,000 to allow for any earthquake strengthening work required.

In my opinion the inclusion of the $1 million refurbishment of the Motueka library in the draft annual plan (and its eventual removal in the final annual plan) was a $1 million straw-man for other items to be kept or included in the final annual plan (eg the Golden Bay recreation centre). This is because some around the council table considered that the removal of the library (and deferment of the service centre) gave them room to do other projects within the existing budgeted program of expenditure. And as observed above, the inclusion in the draft annual plan of a refurbished Motueka library had little support during earlier workshops.

If I had been forced to chose between a $3 million Motueka hub concept and $3.5 million Golden Bay recreation centre, I probably would have chosen the hub concept. Why? Because the Golden Bay recreation centre still had a number of years of good service left within it. If we could sweat our roads (eg, defer maintenance of roads in the annual plan), we could easily sweat a recreation centre for a few more years. Furthermore, during an inspection of the recreation centre we were told that the main concerns with the centre were access to showers from the visitor changing sheds (which currently involved a toweled walk to the showers) and the closure of the grandstand (on the roof of the centre) due to earthquake risk. Both minor inconveniences and costs. Finally, some in the Golden Bay community also did not support another recreation facility if it added more debt. In contrast, the Motueka hub concept provided service improvements and potential operational cost savings.

A debt grenade

After consideration of the Motueka library refurbishment, the finance manager was invited to make a presentation on our financial (and debt) position in light of council’s intended expenditure program. This was to be a later item in the agenda.

During this presentation, the finance manager informed council that due to the 2014-15 annual plan being the last year of the previous long term plan, all outstanding capital projects (eg work that had yet to start or had not been completed) would have to be recognised in the 2014-15 financial accounts. This would also provide a clear financial position when considering the next long term plan.

Basically, council had committed to $20 million of capital expenditure in earlier years that would be catching up with the council’s balance sheet in the 2014-15 year. In effect, around $9 million dollars of debt funded capital works that had yet to completed would be added to the 2014-15 financial accounts.

Some councillors were quite shell shocked by this apparent increase in the council’s debt position. Although others recognised that this was actually debt funded expenditure that council had already undertaken to spend in earlier years. At this point the mayor asked that the meeting be suspended until the financial implications of the debt could be analysed. Subsequently, the revised (and very real) debt position was reported in the media (see Waimea Weekly. see “Shock as $18M blow-out found” (4 June 2014) http://issuu.com/waimea-weekly/docs/040614/1?e=1913941/8122090).

The reality was that the council’s closing debt position, based on forecasted opening debt (of $167 million) would be higher than forecast in the draft annual plan. However, due to the forecast of $167 million being higher than actual debt of $148 million, the increase in recognised debt meant that the forecasted closing debt position would remain close to what was forecasted (around $173 million).

The reality was that our debt was still going up. It’s just the forecasted increase from $167 million to $173 million (a $6 million increase) would instead go up from $148 million to $171 million (a $23 million increase).

In both scenarios, new debt increases by approximately $6 million. That’s the real figure to watch. As is the closing debt position – which will translate into increasing interest payments.

A figure we cannot afford. At a time when we should be trying to minimise debt funding so we can begin to turn the debt funding of council activities around. We already spend $8 million a year in interest payments. Thats three community recreation centres a year!! Thats why I could not at this time support any debt funding of assets that are not critical.

Sorry Golden Bay, but getting our debt under control has to come first, and saving $3.5 million is an easy first win that would have made a sizeable dent in a very large debt ship that we have to begin turning around. Adding $3.5 million of fuel to an “interest repayment” fire just makes no sense to me especially when we not under any real pressure to replace the recreation centre. Finally, in my opinion, more pressing issues (like storm water) required council funds before we could spend money on recreational facilities.

If anyone tells you we do not have a debt problem they are deluded. We have got to stop spending on the nice to have items to ensure we have the head room to turn around our dependence on debt funding, preserve our credit rating, and ensure we spend our money on the more pressing priorities (like storm water). That should have started now. Alas, its been kicked for touch till next year.

Day two – a fait compli

Council reconevened on Tuesday (5 June 2014) to move through the remaining items on the agenda. Apologies were received from Cr Inglis and Cr Canton. All other councillors were present. By this time, the shock of the debt had lulled and many councillors felt that it was just funds moving around on paper. But as I alluded to above, the reality is that council debt was increasing by a further $6 million.

Golden Bay service centre

The draft annual plan proposed adding just under $1 million dollars to the 2013-14 annual plan for a rebuild of the council service centre.

This building was a council services building used by council staff and for the public to make enquiries, pay rates, and obtain resource consent information. The building is located on crown granted land. If the land is not used for council purposes, it will revert back to the crown. Staff were removed from the building when it was identified as earthquake prone (eg, below the approved 66% earthquake compliance requirement). Accordingly, staff were shifted to a temporary building, opposite the back of the Motueka public library.

This left the council with several options: (1) refurbish the service centre so its 66% earthquake compliant costing $380k, (2) rebuild a new centre for no more than $1 million, or (3) relocate the service centre to another location – either the library or information centre. Added to the decision mix were several additional considerations. First, the council could receive additional insurance funds if it included a commercial space in any rebuild. Second, any relocation would require additional expenditure of expensive fibre for sending data to the service centre. This effectively ruled out relocation.

In terms of a rebuild it was argued that there was little financial difference in cost for a new build and any refurbishment that met the 66% earthquake standard. Especially if the new build would enable a commercial space to be added that would be partially funded by the additional insurance and future rental income.

However, there was a larger financial difference if the refurbishment was only required to meet a 34% earthquake standard. The expected cost would probably be something less than $380k. Given the government had announced a forthcoming change in the earthquake standard (from 66% to 34%), it was felt that the financial argument for a rebuild did not stack up, and earthquake strengthening to a 34% standard was the more cost effective option. Accordingly, the project was deferred to the long term plan for further consideration and no budget for a rebuild was required in the 2014-15 annual plan.

I think this was a very sensible financial decision. And one that perhaps preserves the heritage value of the building. And due credit also to the Golden Bay councilors (Cr Sangster and Cr Bouillir) moving the change to the draft annual plan. Although I also appreciate this was a tactical concession to get the Golden Bay recreation centre across the line.

Yes, it would mean that staff would have to continue to operate from a very small temporary space – but only for another year or two. In my opinion, there is also still scope for some functions (not all) to be moved to the library, so that only planning functions operate from the temporary building. This might alleviate in the short term some of the spacial pressure. However, that is for a future discussion.

Moving forward, the council will be investigating how much refurbishment work is required to meet a 34% compliance requirement so staff can return quickly to their former building.

Golden Bay community centre (or recreation centre)

This proposal sought the replacement (and upgrade) of the existing rugby clubrooms and squash courts. The upgrade also proposed the addition of net ball courts. The co ncept and plans can be viewed on the councils website (see http://www.tasman.govt.nz/policy/public-consultation/recently-closed-consultations/feedback-form-golden-bay-community-recreation-facility-concept-plan/).

I attribute its demise in the draft plan on the finance manager’s presentation to councilors on our debt position just before it was considered. And Cr Higgins vigerous support of that message. That presentation emphasised the cost of adding any more debt funded programs to the council books.

We also heard that there was no legal obligation on council to provide a recreation centre in Golden Bay. In effect, the inclusion of a new recreation centre was a luxury that we did not have to commit to in the next financial year. We could take a “tea break” and consolidate our financial position. Rather than rush in, we could take the time to improve our financial position before embarking on any more projects.

Shifting the recreation centre to the long term plan would also give the Golden Bay community more time to raise the necessary finance while signaling the project had not been forgotten. We just needed time to sort out the councils finances first. All very rational and prudent.

However, in my opinion, the reality was that the inclusion of the Golden Bay recreation centre (together with other items) in substitution of the Motueka library was a missed opportunity to reduce debt at a time when interest rates are going up. The time to spend on nice to have items (like recreation centres), is when interest rates are low or trending downward. Not when they are trending up or when the demand (and price) for builders and contractors will be high as the Christchurch rebuild gathers stream.

While I appreciate that the councils commitment was changed from $3.5 million to $3.2 million (a $300k reduction). It still commits council to debt that in my opinion was unnecessary to commit to, when were are also starring down the barrel of a Dam proposal, as well as a strain on our storm water infrastructure, as rainfalls are projected to increase due to climate change.

At this point I note a recent article in the Nelson mail on stormwater (see http://www.stuff.co.nz/national/10236222/Flooding-battle-to-cost-millions). In that article it was stated that storm water and flood protection would mean more borrowing and more debt. In my opinion, this misrepresents the debate. The tension is not between addressing storm water issues and debt, it is between addressing storm water issues and spending money on other nice to have projects. Its a question of prioritising spending. Surely protecting peoples homes, comes before building recreation facilities?

As a community we band together to protect one another during a crisis. Mitigating the potential cost to the community of a major flood (not to mention the risk of potential insurance fee hikes or non-insurance, as well as litigation risk for council) surely warrants the investment. Not to mention removing the unnecessary worry ratepayers have whenever there is a major rainfall event. This is a political decision and the community need to speak up.

If Champion Rd can have Q100 storm water solution why can’t the other three or four hotspots in Richmond. For example, the Hart Rd\Bateup Rd intersection which receives rainfall from the higher Richmond south developments and was under water during the last three heavy rainfall events since 2011. Or the cemetery dam overflow (at the back of the Richmond cemetery), that nearly overflowed were it not for the valiant mid-night efforts or nearby residents removing flood debris from storm water grills – averting what could have been a major disaster for homes below the cemertery.

Finally, while the Golden Bay recreation centre will only add another $1 million of debt to the 2014-15 plan, the proposal is funded across two years. This means that council has already committed to the remaining $2 million of debt in the 2016-17 year. This places another road block in prioritising available funds on storm water in future years. And the overall increase in debt remains the same $3.2 million.

For the record, Cr Murfin and I opposed this expenditure. Cr Norris also voted against the amended resolution, although he voted against it on the basis it should have remained at $3.5 million.

Tourism

This issue has generated a lot of confusion – and it has not been helped by poor communication of what council (or at least some councilors) set out to do – which was to review the return on investment from tourism funding. I’ve discussed this issue in earlier posts so I will not revisit the debate. However, the outcome of the annual plan puts in place funding for destination tourism for the 2014-15 year, with some incentive for the relevant stakeholders to resolve future funding before the end of this year.

Great Taste Trail (or cycle trail extension)

This proposal sought to build the next planned segment of the trail beyond Wakefield. During workshops leading up to the draft annual plan being finalised, many councillors were opposed to this proposal on the basis of the ongoing operational costs council would be exposed too against the limited financial return it might offer Wakefield businesses. However, the Mayor suggested that if he could secure 50% government funding would councilors support the cycle trail being added to the draft annual plan. On that basis it got support during the workshops. However, between the workshop and the proposed resolution, the funding source got widened to include other third parties (potentially including institutions that might received council grants).

To reinforce councils commitment that funding the cycle trail extension was only on the basis of government funding, and not from another entity that might be indirectly funded by council grants, I moved that the last three words of the resolution be removed – namely “or another third party”. Unfortunately, I received no support for this amendment and it was defeated.

Everything else (including the Mapua development)

Surprisingly (or perhaps not), the $1.2 million Mapua development was lumped into the fill-a-buster resolution – together with 70 other items for consideration.

As it was part of a single resolution, you had to either support the resolution or not. This meant that disagreement with one of the 70+ items meant you had to vote the whole resolution down, or note your dissent on any of the 70+ items being considered. For example, the $1.2 million Mapua development proposal.

I had thought given a number of residents raised concerns about this item, the level of general public interest, the size of the investment, and the fact the cycle trail (involving only $300k) had received a separate resolution, that the Mpaua development proposal would also have been separated out from the rest of the items, that were less controversial. However, the Mayor (who is responsible for setting the agenda) preferred to leave it in amongst the rest. However, as concession the Mayor allowed councillors to note their disapproval of any single item – which I chose to do – rather than seek to separate the item from the main resolution.

By way of a brief background, the Mapua development initiative proposes to build on the former acquarium site. Two build options were outlined by a WHK report. The first was a container option (similar to the one used in Christchurch) for around $100k. The second was a standard build for $1.2 million. This would be partially debt funded. A third option was to just lease the land and let a developer build and lease any new building.

In my opinion, its not for council to seek more equity from ratepayers in order to embark on new commercial activities. If ratepayers want to invest their money in new commercial activities they should not be compelled to do it through increases in rates. And lets be frank, thats what is being proposed.

I also do not believe it is for council to attempt to control what businesses operate in the Mapua precinct other than by regulations. That is for the market to decide. If there are undesirable businesses, they can be controlled through regulations, not buying up all the buildings so the council becomes the sole lease holder of the entire precinct. However, if councilors want to employ a strategy of ownership, then they should be doing it for the least cost.

In my mind the container option would achieve the desired outcomes in a more cost effective manner, as well as bringing back a buzz to the Mapua precinct, in the same way it has happened in Christchurch (see http://www.thefifthestate.com.au/archives/49798/ and http://www.china.org.cn/photos/2011-12/04/content_24070673_3.htm). The added benefit of a container development is that it would reduce the lease costs for tenants while providing a very efficient space to operate their businesses from.

Arguments have been made around small space a container would offer, but the type of family businesses some councillors seek to retain in the precinct could easily operate from smaller spaces – as is the case in Wellington. Although I should add containers can be made into larger spaces (as the pictures of the ChCh precinct show). A container development would also allow more space for public seating which is at a premium in this area. After staff costs, lease costs are a major hurdle for start-up businesses, especially craft businesses. A container development would provide opportunities for new businesses to establish themselves. Surely this is a good thing.

An argument was advanced by staff that the $1.2 million should remain in the budget so that full council could at least consider whether the proposal had merit. If it was removed, council could not consider whether the proposal had any merit. In my mind, council should have nipped the project in the bud then rather than waste any further effort by staff. However, that argument found favour and the majority of councillors (but not all).

In my mind, expenditure of $1.2 million (or for that matter anything above $200k) that would require more debt funding, did not have any merit. Accordingly, I voted against it and noted my dissent on the item.

 Agenda and minutes

The agenda and minutes for the annual plan are found at: http://www.tasman.govt.nz/council/council-meetings/standing-committees-meetings/full-council-meetings/?path=/EDMS/Public/Meetings/FullCouncil/2014/2014-05-30 and http://www.tasman.govt.nz/council/council-meetings/standing-committees-meetings/full-council-meetings/?path=/EDMS/Public/Meetings/FullCouncil/2014/2014-06-30.

Newspapers

http://www.tasman.govt.nz/council/media-centre/news/minimising-the-impact-on-ratepayers-remains-a-major-focus/

http://www.stuff.co.nz/nelson-mail/news/10227950/Final-decision-on-rates-plan

http://nelsonweekly.co.nz/funding-cut-to-cycle-trail/

http://www.stuff.co.nz/nelson-mail/news/10018498/Tasman-to-tackle-debt-crisis

“Shock as $18M blow-out found” (4 June 2014) http://issuu.com/waimea-weekly/docs/040614/1?e=1913941/8122090

http://www.stuff.co.nz/nelson-mail/news/9828399/Tasman-rates-to-rise-up-to-3-5pc

http://www.stuff.co.nz/national/10236222/Flooding-battle-to-cost-millions

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Full Council Meeting (5 December)

A full Council meeting was held on 5 December 2013. The agenda was substantial (taking over the allotted 6 hours to be considered) and comprised:

  • public forum presentations;
  • freedom camping rules;
  • port Tarakohe proposal;
  • appointment of directors;
  • Murchison visitor centre proposal;
  • regional tourism proposal;
  • parking and other traffic restriction rules;
  • Saxton field transmission lines;
  • Kina peninsula boat shed proposal;
  • Water storage (known as the lee valley dam) project issues;
  • Brightwater domain deliberations;
  • Chief Executive’s activity report; and
  • replacement of the mayor’s car.

All councillors were in attendance.

To keep this post short, I have summarised below the main items that took up most of the councils time.

Public Forum

A number of submissions were received – most on the trans-pacific partnership agreement (TPPA) and Port Tarakohe.

Trans-Pacific Partnership Agreement

Having received a number of public submissions on the TPPA council resolved to ask that staff report back briefly on the public’s draft resolution so that it might be considered at the next full council meeting. By way of background, the previous Council had already passed a very short resolution in September 2013 (see http://www.tasman.govt.nz/council/council-meetings/standing-committees-meetings/full-council-meetings/?path=/EDMS/Public/Meetings/FullCouncil/2013/2013-09-19) which was followed by a letter from council to the Minister of Trade (a copy enclosed in the agenda at p 309). However, the proposed draft resolution put before council proposed using similar wording as used by the Auckland and Nelson councils resolutions.

The Auckland council resolution (item 26) can be found at:

The reports and presentations that gave rise to that Auckland council resolution can be found at (item 26, pp 385-419):

The Nelson council resolution and minutes can be found at:

See also http://www.scoop.co.nz/stories/AK1307/S00665/nelson-is-second-city-to-pass-critical-resolution-on-tppa.htm.

Council decided to direct staff to report back at the next full council meeting on the draft resolution’s consistency with the Auckland and Nelson resolutions, so that it could consider whether it wanted to pass a more though resolution.

Since then, Greater Wellington Regional (GWR) council has also passed a resolution (dated 12 December 2013) on the TPPA (see http://www.stuff.co.nz/dominion-post/news/politics/9513659/Council-wades-into-trade-debate). It is noted that the proposed resolution (http://www.gw.govt.nz/assets/council-reports/Report_PDFs/13.1049.pdf) and final resolution (reproduced below) were much shorter than the Auckland and Nelson resolutions. The final GWR resolution (dated 12 December 2013) states:

“That the Council expresses concern at the lack of information available on the potential implications of the Trans-Pacific Partnership Agreement for New Zealand and for local government and, while accepting that treaty negotiations are general confidential:

1: Notes public reports that the New Zealand negotiators, along with those from other like-minded countries, do not agree with a number of proposed measures including those pertaining to pharmaceuticals, intellectual property protection and environmental measures;

2: Notes that the TPP, as with all trade agreements, will go through the full parliamentary process and, once that is complete, any law changes necessary to ensure New Zealand’s compliance with the treaty must be passed by parliament; and

3: Urges the Government to instruct its negotiating team to continue to oppose measures that would have unjustifiable negative impact on the ability of local government to make decisions on a range of options including procurement that are currently available under New Zealand law.”

For information on the process of adopting a treaty into New Zealand law (see http://www.mfat.govt.nz/Treaties-and-International-Law/03-Treaty-making-processhttp://www.scoop.co.nz/stories/PO1212/S00035/treaty-making-101-for-ministers-bloggers-and-lobbyists.htmhttp://www.parliament.nz/en-nz/pb/business/qoa/50HansQ_20131210_00000008/8-trans-pacific-partnership—release-of-information, http://www.parliament.nz/en-nz/pb/business/qoa/50HansQ_20131211_00000005/5-trans-pacific-partnership%E2%80%94ratification-processhttp://www.lawcom.govt.nz/sites/default/files/publications/1996/05/Publication_38_101_R34.pdf).

See also http://www.stuff.co.nz/nelson-mail/news/9508457/Tasman-may-seek-TPPA-pledge.

For a recent update on the TTPA see http://werewolf.co.nz/2013/12/tpp-all-cards-on-the-table/

Freedom Camping

I’ve spoken to this topic in an earlier post. Essentially Tasman now has two freedom camping bylaws. One governed by the Local Government Act (LGA) and now another governed by the new Freedom Camping Act. Designated areas in Motueka have been selected for coverage by the new bylaw as empowered under the Freedom Camping Act. Other proposed areas (for example, Liga Bay) will continue to be controlled by the older bylaw empowered under the LGA, as is most of Tasman District. Council will be monitoring the application of the new bylaw to gauge its success and whether further role out is warranted (if at all).

Port Tarakohe

This was a controversial proposal. The premise for the proposal was the removal of financial support from the general rates so that users of the port were paying for its ongoing operation, rather than ratepayers. In order to do this charges for using the port would have to be increased to make it self sustaining. The port is used by recreational users and commercial fishers (mainly mussel farmers). After, what I consider to be, a very brief consultation period (given its complexity and magnitude), it was decided that the original proposal would be softened. In effect, the impact of the proposed charges would be spread over a longer term (ie the charges would progressively be stepped up over a five year period) producing a working capital surplus by year 5 of nearly $300,000.

During council discussions I had asked staff if the projected working capital could adopt a zero surplus position (in effect reducing the charges so no working capital was accumulated). However, I was advised that without sufficient working capital no improvements to facilities or services on the wharf could be made (and this had been requested by community board members and some councillors).

I believe that council and the Golden Bay community still need to come up with a longer term strategy for the port to be sustainable. The real issue is the amount of business that the port generates (or does not generate). If there was more business going across the wharf, then there would be less pressure to increase port charges.  In my opinion, if products (like milk) were able to use the port for shipping product to and from Golden Bay, rather than being trucked over the hill (causing road repair costs for the community), then the port (and our roads) might be in safer hands. The challenge is to make shipping a cost effective option. It might also be suggested that business activity around the port could be increased by providing the right incentives for new port businesses to be established and grow.

See also http://www.stuff.co.nz/nelson-mail/news/9485457/Port-users-face-hike-in-charges.

Tourism

Tourism is another significant issue for Tasman. It is also a multi-faceted issue that essentially involves two layers of tourism promotion. First, there is promotion (usually the provision of information) from visitor centres within the region. This is the most visible form of tourism that ratepayers might experience or see themselves. Secondly, there is the promotion of Tasman to the outside world – both domestically and internationally. This type of destination promotion is pitched at attracting people to the region, rather than giving them information once they are here.

At present, tourism for Nelson and Tasman is managed by a company called Nelson-Tasman Tourism Ltd (NTT) that is jointly owned by the Nelson and Tasman councils. NTT operate a number of licensed “i-sites” (effectively branded visitor information centres) across both Nelson and Tasman. The most used and most visible being the Nelson “i-site”.

As part of NTT’s review of its operations, it proposed to close down two loss making “i-sites” – namely the Golden Bay and Murchison “i-sites”. At this point, its worth noting that a separate proposal for the continuation of a visitor centre in Murchison was also considered by council. In effect, the proposal sought to provide a visitor centre as part of a single central service hub that would be housed in a common building with other council services (for example, the council services centre). The recommendation was that a visitor centre needed to be on the main road. However, this is open to debate, as effective signage on the main road that points to a side road, only a short distance away, might be just as effective. It’s only when the journey from the signage to the visitor centre is more convoluted, that a presence on a main road is required. In Murchison, there is no danger of the journey being very long, as there are only a few side streets off the main highway through Murchison.

In terms of visitor centres, I am of the opinion that a single central service hub for visitor centres is the way to go. This would mean that NTT would not be required to manage visitor centres and council would directly fund them. A shared service hub, be it with other council services or the Department of Conservation (DOC)  should provide cost savings, both from shared building space and shared staff. For example, in Motueka, a visitor centre could be part of the Motueka library. Similarly, a visitor centre could be part of the Richmond library or Golden Bay library. This would enable visitors to have access to computers to make bookings, as well as have access to library staff who can point them to the relevant resources. I should add, that this would not mean that the Richmond visitor centre on Gladstone Road would be abandoned (as its incredibly cost effective due to being run by volunteers), but rather tourism could be run from the Richmond library as well, for very little additional expenditure.

Bringing all visitor centres under the direct control of council is the direction that is being pursued. And I agree with that direction, provided it delivers cost savings. This would mean that half of NTT’s function (and funding) would no longer be required and that funding would be redirected away from NTT and back to council. Whether council wish to withdraw from the second function of NTT (the promotion of Tasman as a destination) is still open to debate. Certainly the resolution that was passed by council invited further consultation on the issue, although it also made it clear to NTT, that council was considering withdrawing all funding of NTT for destination tourism. To make it absolutely clear, the council has yet to make that decision.

At this point its also worth considering the council commissioned report from OPUS. That report examined NTT’s role and suggested that it merge with another agency – the Economic Development Agency (EDA). Whether that is a well thought out proposal is hard to gauge at first glance as there was very little in terms of evidence in the report to suggest where the efficiencies and cost savings were from such a merger.

In my opinion, Tasman still requires investment in destination tourism. The question is what entity is best suited to provide that service. Is it NTT or is it another entity. Of course there is also another question tied up with this issue, which is funding. Who should be funding destination tourism – ratepayers or business? In my opinion, if council is funding visitor centres, then from a position of consistency, council should also be funding destination tourism. Lets not forget, businesses also pay rates.

So what was decided. First, council approved ongoing funding of NTT for the 2014-15 year at a maximum level of $426,000 (which is what Nelson council recently agreed). Second, council undertook to directly fund all visitor information centres in the region for the 2014-15 year (and correspondingly reduce NTT funding to a maximum level of $170,000). Thirdly, council sought, as part of its consultation over the 2015-25 long term plan, consideration of a proposal to withdraw all funding of NTT. Whether this proposal is adopted has yet to be decided. Fourthly, council agreed to consider the Murchison proposal to merge visitor information and council services centres into a single hub. Finally, council requested that financial proposals for Motueka, Golden Bay, and Murchison visitor information be completed by 31 January 2014, so they could be assessed.

See also http://www.stuff.co.nz/nelson-mail/news/9518177/Tourism-body-threatenedhttp://www.stuff.co.nz/nelson-mail/news/9489922/TDC-set-to-pull-the-plug-on-tourism-bodys-funding, http://www.stuff.co.nz/nelson-mail/opinion/9498567/Editorial-Fine-tourism-line-for-Tasmanhttp://www.nelsoncitycouncil.co.nz/council/news/recent-media-releases-and-news/council-commitment-to-tourism-remains.

Water Storage – The Lee Valley Dam

Council were also briefed on the processes and requirements council could be expected to follow when considering any future water storage proposal. As part of that discussion the chief executive had devised a memorandum of understanding with the key players to date. Namely the Waimea Water Augmentation Committee (WWAC) and a proposed holding company (Dam Co) that would be established by the WWAC. Dam Co would be used to apply for the various resource consents required for any water storage solution. Council was advised that wrap-around legal documentation with Dam Co, securing various property interests and rights for council, would be entered into between Dam Co and the council.

In my opinion, council should be establishing its own holding company, rather than using a privately owned entity, regardless of the legal protections council might put in place. This is because it shows to the public that no ownership outcomes have been pre-determined and avoids the need for unnecessary legal complexities. As history shows, complexity is the father of unforeseen surprises and this is not a project where we need surprises.

Appointments – Director of Airport

The council resolved to appoint Cr Edgar as a council appointed director of the airport. Cr Edgar holds a number of chair positions on council committees and is an experienced councillor. Readers of this blog will also remember that Cr Edgar was also nominated for deputy mayor at the first council meeting, which she subsequently declined to accept (see earlier post).

Agenda and Minutes

A copy of the agenda an minutes of this meeting can be found at http://www.tasman.govt.nz/council/council-meetings/standing-committees-meetings/full-council-meetings/?path=/EDMS/Public/Meetings/FullCouncil/2013/2013-12-05