Agenda of Policy and Strategy Committee Meeting

Policy and Strategy Committee Meeting Minutes

4 August 2021

DRAFT

MINUTES OF Carterton District Council
Policy and Strategy Committee Meeting
HELD AT THE Carterton Events Centre, 50 Holloway Street, Carterton
ON Wednesday, 4 August 2021 AT 11:00am

IN ATTENDANCE: Interim Chair Robyn Cherry-Campbell, Mayor Greg Lang, Interim Chief Executive Blair King Councillor Rebecca Vergunst, Councillor Steve Cretney, Councillor Brian Deller, Councillor Jill Greathead, Councillor Rob Stockley, Councillor Dale Williams, Marae Representative Rīhi Clarke-Reiri

STAFF PRESENT: Dave Gittings (Infrastructure, Planning and Regulatory Manager), Kelly Vatselias (Corporate Services Manager), Geri Brooking (People and Wellbeing Manager), Glenda Seville (Community Services and Facilities Manager), Elisa Brown (Senior Planner Solitaire Robertson, Communications and Engagement Advisor), Serah Pettigrew, (Democratic Services Officer ) Sheree Dewbery (Executive Assistant to Mayor and Chief Executive)

GUEST: Jos Coolen, Urban Designer Boffa Miskell

1 Karakia Timatanga

One Minute Silence in recognition of the passing of prominent community member Mike Osborne.

The meeting was opened with a Karakia led by Interim Chair Robyn Cherry-Campbell

2 Apologies

There was an apology for Cr Russell Keys’ (absence)

CARRIED Cr Steve Cretney / Cr Rebecca Vergunst

3 Conflicts of Interests Declaration

Conflicts of interest Declaration by Cr Brian Deller

CARRIED Interim Chair Robyn Cherry-Campbell / Cr Dale Williams

4 Public Forum

There was no public forum

5 Confirmation of the Minutes

5.1 Minutes of the Policy and Strategy Committee Meeting held on 2 June 2021

Comment

Brief discussion under 6.1, regarding the Procurement Policy. Elected members recommend that it be reviewed in the next Policy and Strategy Meeting to be held on 29 September 2021.

Moved

CARRIED Cr Rebecca Vergunst / Cr Jill Greathead

6 Reports

6.1 Resource Consent Update

Purpose

To update the Committee on the resource consents issued since the previous meeting.

Elected members requested more detailed identification of property locations.

· Action point: Street name of properties is to be included in the report e.g. Broadway or Hughes Line

Further discussions were around the relocation of dwellings and road conditions and consent.

Moved

That the Committee:

Receives the report

CARRIED Cr Rob Stockley / Cr Brian Deller

6.2 Eastern Growth Update

Purpose

For the committee to receive updated plans as a result from the feedback from the Eastern Growth informal consultation undertaken.

Main points of discussion were around Stages 2, 3 & 4 of the report, the buffer zone, the lot sizes, and the effects on the Carterton water supply.

Flooding risk as a result of climate change was discussed. An increased buffer zone from the waterway is preferred to mitigate potential flood damage and can be used as a green area, spill zone, bird path.

Points raised to include the Eastern shared pathway indicated on the map.

· Action point, linkage to be added.

Discussion on how green space within stage 3 can be included.

· Action point to include green space.

Option 4 with the following modifications preferred:

1. Walkway from Moreton Road to connect with schools to be shown on any updated maps.

2. Provide for 1000m2 lots on the eastern side of Rutland road, provided that any development as a whole averages 1500m2

3. Provide for a 50m buffer along Booth Creek, this being made up of a 25m buffer either side of the centre line of the creek.

Moved

1. Cr Steve Cretney / Cr Brian Deller

2. Interim Chair Robyn Cherry-Campbell / Cr Rob Stockley

3. Cr Rebecca Vergunst / Cr Brian Deller

4. Cr Rebecca Vergunst / Cr Steve Cretney

CARRIED

That the Council/Committee:

1. Receives the report

2. Notes the four different options.

3. Adopts option modify four as the Strategy and Policy’s preferred option.

4. Recommends that council instructs officers to engage a suitable consultant to investigate water supply possibilities for growth as per modified option 4.

6.3 Application for remission of water charges from leaks

Purpose

For this Committee to approve the attached form as Council’s approved application for remission of water leak charges.

Main discussion was about the frequency of applications, and delegation limits.

· Action point – to add the website link into the paper on ‘how to read your meter’.

Moved

1. Cr Dale Williams / Mayor Greg Lang

2. Cr Rebecca Vergunst / Interim Chair Robyn Cherry-Campbell

3. Cr Rob Stockley / Cr Dale Williams

CARRIED

That the Committee:

1. Receives the report

2. Recommends the Committee adopts the APPLICATION FOR PERMISSION OF WATER CHARGES FROM LEAKS, as Councils Water Leaks Remission Policy

3. Reviews the implementation of the Policy in 12 months.

6.4 Dust Suppression Policy

Purpose

For the committee to review a draft Council dust suppression policy

Discussion around dust levels on unsealed roads

· : Action point - Item 6 under Otta Seal, add in life expectancy.

· Action point - Item 7 under Residents Contribution, add in Council to part fund up to 75% of the balance following Waka Kotahi contributions.

Moved

Cr Dale Williams / Cr Brian Deller

CARRIED

That the Committee:

1. Receives the report.

2. Agrees to acceptance of a Draft Suppression Policy with the amendments

3. Notes that the final Policy will be presented for adoption at the meeting 29 September 2021.

6.5 Development of a Wairarapa Combined Smoke Free policy

Purpose

For the committee to note the development of a three Council combined smoke free policy

Discussion on the inclusion of e-cigarettes / Vape cigarettes.

Moved

Cr Rob Stockley / Interim Chair Robyn Cherry-Campbell

CARRIED

That the Council/Committee:

1. Receives the report

2. Notes that the Wairarapa Policy Working Group will be called upon to develop the policy

3. Notes that each Council will adopt the final policy separately

6.6 Elected Members Expenses and Reimbursements Policy

Purpose

The purpose of this report is for the Committee to review the updated policy on elected members’ allowances and expenses, based on the Local Government Members (2021/22) Determination 2021 (the Determination), and recommend adoption of the policy by Council.

No discussion raised.

Moved

Marae Representative Rīhi Clarke-Reiri / Cr Steve Cretney

CARRIED

That the Committee:

1. Receives the report.

2. Notes the content of the report.

3. Recommends adopts the Policy on Elected Members’ Allowances and Expenses 2021.

6.7 Lapse of rally bond policy

Purpose

For the Committee to agree to the current Rally Bond Policy be lapsed.

No discussion raised

Moved

Cr Dale Williams / Mayor Greg Lang

CARRIED

That the Council/Committee:

1. Receives the report

2. Agrees to lapsing of the current ‘Bond for road events’ policy

7 Karakia WhakamUtunga

The meeting was closed with a Karakia led by Marae Representative Rīhi Clarke-Reiri

The Meeting closed at 1:18 p.m.

Minutes confirmed: ……………………………………

Date: ...................................................

Policy and Strategy Committee Meeting Agenda

29 September 2021

6 Reports

6.1 Department of Internal Affairs Three Waters response

1. Purpose

For the committee to endorse the Chief Executives letter to the Department of Internal Affairs

2. Significance

The matters for decision in this report are not considered to be of significance under the Significance and Engagement Policy.

3. Background

The New Zealand Government has initiated a wide-ranging reform of the three waters sector which is ongoing in 2021 and intended for implementation 1 July 2024. Over the past two decades, there has been many Government and sector reports dealing with the wide range of issues surrounding the New Zealand three waters sector.

The current reform was triggered by the Havelock North water supply incident in 2016 where contaminated groundwater entered the water network and led to 5,000 people falling ill, 50 hospitalised and five consequential deaths.

The subsequent Government inquiry in 2017 observed that New Zealand had fallen well behind international best practice in the delivery of drinking water and made wide-ranging reform recommendations.

The Government received these recommendations and is acting on them in the current reform process.

In July 2020, the Government launched the Three Waters Reform Programme, a three-year programme to reform local government three waters service delivery arrangements.

At the same time, it announced a $761 million funding package to provide post COVID-19 stimulus to maintain, improve three waters infrastructure, support a three-year programme of reform of local government water service delivery arrangements (reform programme), and support the establishment of Taumata Arowai, the new Waters Services Regulator.

In September 2020, the Council approved the signing of a Memorandum of Understanding to remain engaged in the reform process. It was a non-binding commitment to receive initial funding for specific shovel-ready projects and continue to be involved in the reform process.

The Council consequently received funding of $1.84 million to be spent on approved water, wastewater and stormwater projects by March 2022.

The Council is on track to spend this funding.

4. What Council has been asked to do

Department of Internal Affairs have asked local authorities to review and consider the reform package and its implications for the communities they serve. Councils are asked to carry out analysis to understand the potential impact of the reform by taking these steps:

1. Understand the key features of the proposed model and how it is intended to work.

2. Apply the proposed model to Council circumstances (considering impacts on the community) for today and for the future (proposing a 30-year horizon).

Local authorities are encouraged to consider the impacts of the proposed reform holistically, in terms of service outcomes, economic development and growth, finance and funding, workforce capability and social, community and economic well-being. Local authorities are asked to provide feedback on outstanding issues identified by the Government.

Government is seeking feedback on, and solution refinements for, issues that councils have raised that aren’t fully resolved and on which the Government has said there is room for flexibility to come up with solutions that meet local needs:

1. Ensuring all communities have both a voice in the system and influence over local decisions. This includes assurance that water service entities will understand and respond appropriately to communities’ needs and wants, including responding to localised concerns.

2. Effective representation on the new water service entities’ oversight boards so that there is strong strategic guidance from, and accountability to, the communities they serve, including iwi/mana whenua participation. This also covers effective assurance that entities, which will remain in public ownership, cannot be privatised in future.

The sections set out below are a high-level summary of the information Council has been asked to assess.

5. Cabinet papers

Government has produced a high number of papers to support Cabinet decisions thus far on the three waters reform programme dating back to 2017. The latest releases (30th June 2021) are most relevant to Council’s task. Three cabinet papers titled, “A new system for three waters service delivery”, “Designing the new three waters service delivery entities”, “Protecting and promoting iwi Māori rights and interests” provided more detail on the proposed boundaries of the four water providers, further details on the proposed water services entities, including governance arrangements, the role of iwi, and how they would be regulated.

These papers can be found at: https://www.dia.govt.nz/Three-waters-review

6. Water Industry Commission for Scotland

In December 2020, DIA released a report conducted by the Water Industry Commission for Scotland (WICS), commissioned as part of the programme.

This Phase 1 Report provided an early indicative view on the size of New Zealand’s three waters infrastructure deficit and the potential benefits of reform. Local government representatives expressed concerns over the validity of parts of this analysis, which led to a request for information from councils on their three waters assets and services.

In late December 2020, DIA issued a Request for Information (RFI) to all councils in the country. The RFI required the Council to provide specific data related to the three water activities. The data was submitted in early February 2020 and modelled and assessed by the WICS.

The subsequent report by WICS estimates that New Zealand will need to invest between $120 billion to $185 billion in our three waters infrastructure over the next 30 years to meet drinking water and environmental standards and provide for future population growth. WICS determined that without reform, these costs will be shared unevenly among New Zealand households.

For rural communities, this equates to an increase of up to 13 times present costs, eight times higher for provincial areas and up to seven times higher for many metropolitan households. With reform, the cost of providing these critical services to our communities is likely to reduce substantially by between 45% to 49%. Reform will also improve transparency about, and accountability for, the delivery and costs of these services and uphold the Crown’s Treaty of Waitangi obligations to iwi/Māori.

The Crown has outlined the following features to guide the design of the reform programme and operating structure.

· Maintaining local authority ownership of water services entities.

· Providing the necessary balance sheet separations from local authorities.

· Protecting against privatisation.

· An integrated regulatory system.

· Retaining influence of local authorities and mana whenua over strategic and performance expectations.

The Crown is seeking to enable greater strategic influence to exercise rangatiratanga over water services delivery, ensuring;

· Integration of iwi/Māori rights and interests within a wider system.

· Reflection of a holistic te ao Māori perspective.

· Supporting clear account and ensure roles, responsibilities, and accountability for the

· relationship with the Treaty partner.

· Improving outcomes at a local level to enable a step change improvement in delivery of water services for iwi/Māori.

The Crown has committed to ensuring no Council participating in water reform is in a materially worse position financially to continue to provide services to its community as a direct result of the reform.

7. Data review

During the 8-week period allotted to Council one of the tasks was to explore and understand the WICS model. Three different entities have been employed by Central Government to undertake a review on the WICS analysis. Beca were engaged to reviewed the relevance of the Scottish modelling to the New Zealand environment, Deloitte analysed the effects of the proposed reform on the economy and Farrierswier reviewed the WICS methodology.

The documents in full can be found here: https://www.dia.govt.nz/three-waters-reform-programme-national-evidence-base

BECA REPORT

WICS has modelled different efficiency benefits that could be reasonably expected by a comparable regulatory regime for New Zealand and combined this in a range of amalgamation scenarios that provide further efficiency through scale by the formation of new statutory water services entities (WSEs).

In summary, Beca stated that New Zealand is facing a period of major changes in land, air, and water environmental legislation, and for regional and local government responsibilities. Taken as a whole, Beca conclude that it is very difficult at this time to predict impacts on the New Zealand three waters segment and on the timeframe and total costs (capital and operating) of subsequent changes in standards which apply to the proposed aggregated WSEs. WICS modelling is based on long-term plans from Councils which may well under-estimate the scale, nature and timeframes for upgrading the performance of three waters systems under new legislation.

New Zealand has no consistent nation-wide model for setting and maintaining levels of service for water supply or wastewater management to private residences, industrial and commercial premises. Each Council receives and acts on its own customers’ complaints and there is no mechanism (or requirement) for these to be aggregated across New Zealand, and hence no way to establish common failures by Councils to meet any particular Level of Service, and to therefore establish industry-wide mechanisms for improvements.

On balance, the predictions from WICS modelling may well underestimate the necessary investment costs and could give overly optimistic timeframes for implementation due to supply chain limitations in New Zealand, and the pressures of managing and delivering improvement and asset renewals backlogs simultaneously.

DELOITTE REPORT

Deloitte found that reform is likely to deliver a significant economic benefit of between $14 -$23 billion over the next 30 years in real present value terms. This is equivalent to the New Zealand economy being on average 0.3% to 0.5% larger over the 30-year period, than it otherwise would have been without reform. It is further projected to increase employment throughout the New Zealand economy.

The positive impact is also projected to be distributed across sectors. Trade, Financial Services, Business Services, Construction and Other Services are expected to see the largest increases in GDP as a result of reform. Other Services includes Public Administration and Defence, Education, Human Health and Social Work activities, and Dwellings (i.e. housing).

These are large sectors, which all benefit from the GDP and output growth that reform facilitates. GDP in all sectors shows growth in absolute terms. While the water delivery sector also increases initially, modelling shows a decline from mid-2038 relative to the counterfactual, due to efficiency driven cost savings in this sector as a result of reform.

FARRIERSWEIR REPORT

The overall approach adopted by WICS to modelling the potential impact that amalgamation of water entities and associated reforms could have on projected expenditure, financing costs, revenue and prices of water service providers has been shown to give reasonable estimates in terms of direction and order of magnitude.

Farriersweir conclude that, given the nature of the analysis, there are invariably limitations with it, however Farriersweir do not consider that the modelling undertaken by WICS and the choices it has made over how to do this materially affect the direction (i.e. sign) of estimated benefits from amalgamation and associated reforms.

The order of magnitude of benefits estimated by WICS appears feasible, especially given the 30-year horizon being considered. Sensitivity analysis undertaken by WICS shows that the estimated benefits from amalgamation and associated reform – in terms of average household bills in 2051 – can vary materially if key assumptions are changed. Although this analysis shows that the direction of those benefits is in almost all cases positive, the order of magnitude of estimated benefits could vary noticeably if different assumptions were adopted.

8. Taumata Arowai

In March 2021, the Government established Taumata Arowai, a new water services regulator to administer and enforce a new drinking water, wastewater and stormwater regulatory system.

Once Taumata Arowai is fully functional, it will oversee and administer an expanded and strengthened drinking water regulatory system, new drinking water standards and oversee the environmental performance of wastewater and stormwater networks. This is expected to improve the sector’s performance, and to put greater focus on infrastructure performance.

It is also expected to increase compliance and monitoring requirements.

9. Water Service Entities

On 30th June 2021 the Government announced its intention to shape the sector around four Water Service Entities (WSE). Carterton would belong to ‘Entity C’, along with 22 other Councils. The boundaries have been set with consideration of rohe/takiwā, water catchments, population, economic benefits and the needs and interests of local communities.

Under this model Councils would have no shareholding or financial interest. The WSE would be independent with a competency based Board of Directors. It is intended that the entities have the scale, capacity and capability to uplift the wider sector.

Under the existing model, where Council borrowing capacity is limited, the future rates increases required would be significant. The legislative changes that are currently underway signal a rise in compliance and monitoring and these costs alone will heavily impact rates without additional calculation of environmental betterment. The WSEs will have separate balance sheets to enable more substantial borrowing and lessen the burden on rates alone.

WICS has estimated efficiencies of 45% over a 30-year period, roughly 2% per annum achieved through improved and aggregated capability, procurement, governance, scale and economic regulation, ultimately delivering lower costs for communities.

10. Governance of the Entities

The Government also released proposed governance arrangements, as shown below.

Under this model, Councils will own (without shareholding or financial interest) the water entities on behalf of communities, and mana whenua will have a joint oversight role. The structure of entities and their establishing legislation will protect against future privatisation with assets remaining in the ownership of their local communities.

While Councils maintain ownership of the water entities, the type of entity, and the responsibilities associated with ownership are likely to be substantially different to traditional ownership models. The Government considers that Councils will be able to influence objectives and priorities of the new entities through this structure, and through land use planning mechanisms such as spatial plans. It is not yet clear how communities might directly influence strategy and resource prioritisation.

11. Funding Support

On 15 July 2021, the Government announced a financial support package of $2.5 billion to support the local government sector through the transition to the new water services delivery system and to position the sector for the future. There are two broad components to this support package

The “better off” component of the support package, which comprises $2 billion, is allocated to territorial authorities based on a nationally consistent formula that takes into account population, relative deprivation and land area. This formula recognises the relative needs of local communities, the unique challenges facing local authorities in meeting those needs and differences across the country in the ability to pay for those needs.

An indicative amount of $6,797,415 has been allocated from this “better off” funding should Carterton Council continue to be involved in the three waters reform programme. There are criteria on when and how this funding will be released.

Councils will be required to demonstrate that the use of this funding supports the three waters service delivery reform objectives and other local wellbeing outcomes and aligns with the priorities of central and local government, through meeting some or all of the following criteria:

· enable housing development and growth, with a focus on brownfield and infill development opportunities where those are available; and

· support local place-making and improvements in community well-being.

The “no worse off” component of the support package is intended to address the costs and financial impacts on territorial authorities directly because of the three waters reform programme and associated transfer of assets, liabilities and revenues to new water services entities. It includes an allocation of up to $250 million to support councils to meet unavoidable costs of stranded overheads, based on:

· One hundred and fifty million dollars allocated to councils (excluding Auckland, Christchurch and councils involved in Wellington Water) based on a per capita rate that is adjusted recognising that smaller councils face disproportionately greater potential stranded costs than larger councils

· Up to $50 million allocated to the Auckland, Christchurch and Wellington Water councils excluded above based on a detailed assessment of two years of reasonable and unavoidable stranded costs directly resulting from the Water Transfer.

· Up to $50 million able to be allocated to councils that have demonstrable, unavoidable and materially greater stranded costs than provided for by the per capita rate (the process for determining this will be developed by the Department of Internal Affairs working closely with Local Government New Zealand).

The remainder of the no worse off component will be used to address adverse impacts on the financial sustainability of territorial authorities. This will require a due diligence process that will need to be worked through in the coming months.

In addition to the support package, the Government expects to meet the reasonable costs associated with the transfer of assets, liabilities and revenue to new water services entities, including staff involvement in working with the establishment entities and transition unit and provision for reasonable legal, accounting and audit costs. There is an allocation for these costs within the $296 million tagged contingency announced as part of the 2021 Budget package for transition and implementation activities. This allocation is additional to the $2.5 billion support package.

DIA is continuing to work with LGNZ and Taituarā (previously Society of Local Government Managers), including through the joint Steering Committee process, to develop the process for accessing the various components of the support package outlined above, including conditions that would be attached to any funding.

When announcing the second tranche of funding, the Government indicated that councils would have an opportunity to review the large amount of information, so that each council could provide feedback by 1 October 2021.

The Council is not expected to make any formal decisions regarding the reform through this engagement period. This is an opportunity for the sector to engage with, and provide feedback on, local impacts and possible variations to the proposed reform package outlined by the Government.

Following the engagement period, the Government will consider the feedback and suggestions provided by local authorities, in partnership with the joint steering committee. It will also consider the next steps, including the transition and implementation pathway and revised timing for decision-making, which could accommodate the time required for any community or public consultation.

LGNZ has confirmed that the Government will not be taking further decisions until after this engagement period.

The Government signalled earlier this year that council’s ‘opt-in’ or ‘opt-out’ decision on the reforms would need to be made around November/December 2021. We understand this is still the intention. That being the case, unless there is a change to this timeline it is unlikely that councils will have the opportunity to consult with its communities. This is something that has been raised with the Government as a key issue.

In the coming months Council will need to reach a conclusion on ‘opting in’ or ‘opting out’, unless the government decides an all-in approach is to be applied.

Opting in would result in the transfer of all drinking water, wastewater and stormwater assets including all field operations from the Council to the new Water Service Entity ‘C’. Indications are that any debt or financial reserves associated with the three waters will also be transferred. The details around how these are assessed and transferred is still to be determined.

12. Carterton impact

There remains substantial uncertainty around the impacts of reform. Specifically, the Government has not yet provided a clear outline of the process for decision making, and how public consultation will fit into that process. There is also uncertainty as to how assets, debt and revenue will transfer to the new entity, and the impact this might have on the Council balance sheet.

Carterton Council’s 30-year infrastructure strategy shows further investment requirements beyond 10-year long term plan which are likely to put additional pressure on three waters debt levels. CDCs current debt level is well situated to cope with the known requirements. Debt levels are very manageable with cash reserves meaning net debt to income is approximately 160%, which is well below the local government 250% indicative cap. This indicates that three waters debt levels are unlikely to constrain Council as a whole in the medium term, however the shifting of three waters debt and assets to a separate three waters entity would effectively eliminate Council debt and future investment risk.

The future investment risk is real and manifesting in the legislative changes such as the drinking water Regulator (Taumata Arowai), the Water Services Bill, the changes to the Drinking water standards and Environmental Regulation (Proposed Natural Resources Plan, National Policy Statement on Fresh Water Management, and the Natural and Built environment Act).

With the loss of three waters Councils will be left with a considerably high level of stranded overheads. Council would need to make a strong case for the ‘no worse off’ funding allocation during any transition to the new Water Services Entities.

13. Councillor assessment process

The time period for evaluation set by DIA has been challenging. The financial analysis of potential impacts can only be undertaken at a reasonably high level given time and detailed information provisions.

The analysis has been explored with Councillors in workshop discussions with both scenarios modelled (opt in /opt out) involving balance sheet and debt capacity, rating impact, level of service and costs to maintain those levels.

Councillors have considered the proposed changes to the Drinking Water Standards and the impacts on higher levels of monitoring and compliance will have on operational activities. The National Policy Statement on Fresh Water Management has been considered along with Proposed Natural Resources Plan and the proposed changes to the RMA.

Stormwater compliance has yet to be crystallised but has been identified as a future concern.

Council’s workforce sustainability across, not only operational staff, but financial management and HR, will be impacted if an opt out option is chosen, and the Entity C is progressed without Carterton.

Proposed Governance structures under the reform proposal and the inclusion of Iwi is has been identified as a major concern as has future planning for growth and development and prioritisation requirements within the entity structure.

Council have had an interactive Q&A session with South Gippsland Water to try and understand the impacts of an amalgamated water entity while acknowledging the limitations of being able to directly compare the entities.

These actions have led to the development of a letter (attachment 1) in response to the DIA request from Councils.

14. CONSIDERATIONS

14.1 Climate change

There is no impact on climate change for this report

14.2 Tāngata whenua

The proposed three waters reforms as a whole will attract considerable interest from Tāngata Whenua however, this report does not specifically impact Tāngata Whenua

14.3 Financial impact

As an informational report there is no impact on finances

14.4 Community Engagement requirements

There is no community engagement requirement stemming from this report

14.5 Risks

As an informational report there are no risks

15. Recommendation

That the Council/Committee:

1. Receives the report

2. Endorses the attached Chief Executives Three Waters reform response letter to the Department of Internal Affairs

3. Notes that Carterton District Council does not have enough information to evaluate the Three Waters Reform

File Number: 136259

Author: Dave Gittings, Infrastructure, Planning and Regulatory Manager

Attachments: 1. Final Draft - CDC Feedback Letter to Department of Internal Affairs Three Waters Reform ⇩

2. Final Draft - CDC Letter to Public Three Waters Reform ⇩

Policy and Strategy Committee Meeting Agenda

29 September 2021

6.3 Animal Facility

1. Purpose

For the committee to consider the path forward for the Carterton’s animal facility.

2. Significance

The matters for decision in this report are not considered to be of significance under the Significance and Engagement Policy.

3. Background

There has been an extensive history of attempting to have a Wairarapa joint animal facility. Following discussions in 2014, Council set aside funding for the project in the 2015/16 financial year. Discussions continued until February 2018 when Masterton District Council (MDC) advised CDC that they no longer wanted to progress the investigation into a joint animal facility located outside of the Masterton District.

Given the withdrawal of MDC, South Wairarapa District Council advised that they too would no longer pursue the joint facility investigation. Following these decisions, CDC undertook an animal facility location study (presented to Infrastructure and Services, July 2018) to establish the optimum location for an upgraded animal facility within Carterton.

Late in 2018 the potential for a combined pound with SWDC was explored and a combined animal facility location study was undertaken (presented to Infrastructure and Services, May 2019).

In late 2019, SWDC advised that they were considering alternative options for their own animal facility with the pressing need for SWDC to have a facility closer to their high use operational area (Featherston).

One of the major difficulties in a joint animal facility has been the different operational specification requirements each Council has for the facility. MDC offered an alternative approach to comparing joint facility options, by suggesting CDC use and access their new proposed animal facility in Masterton (essentially a rental agreement for space).

4. MDC proposal

MDC have progressed their revamped animal facility project with the choice of a lead architect been made in September 2020.

An offer has been made by MDC for shared use and access to the building once completed. Of note is that the offer is not an offer of a capital contribution (i.e. ownership) nor is it a shared service, although there is nothing precluding that in the future, regardless of facility location.

The numbers supplied in by MDC in May 2021 were based on a capex spend by MDC of up to $1.7m however, final design and configurations remain a work in progress therefore making the suggested CDC numbers below indicative.

The cost allocation model assumes the fixed costs of the facility will be shared between the three Councils. The CDC percentage, as per the shared service cost agreement, is 22.4% of the estimated $142,500 per annum. This translates to a share portion of $32,000.

In addition to the fixed costs, the operating costs of the new facility are projected to be $77,800 per annum with a suggested cost allocation of 17.4%, based on the estimated number of impounded dogs in a year (75) over the total for the Wairarapa (431). This amounts to $13,500 per annum or $180.50 per dog and would fluctuate year on year.

This would amount to a total rental of $45,500 per annum.

Carterton would have the existing operational expenditure for the animal management of dogs on top of this figure and we would lose a percentage of ability to meet the expected Level-of-Service given the travel time requirements.

5. Carterton’s Animal facility

CDC officers have progressed on a potential design and specification for the Dalefield Road site. The facility has a preliminary space to hold ten pens including whelping and isolation facilities with the ability for more capacity should it be required. The plans and specifications are ready for tender should that be the option chosen.

The budget for CDC is $350k and was approved during the 2019/20 annual plan process. Initial discussions with a potential provider have elevated officer confidence that the facility can be completed within the already specified budget. However, the current construction environment is seeing increasing costs and this is remains a risk for CDC until the procurement process has been completed.

6. Options

The final dollar figure of the MDC offer for access and use of the proposed facility is determined by two main factors. One is the final overall cost of the facility and the other is contingent on SWDC being part of the cost calculation.

Conversations with SWDC indicate acceptance of MDC’s offer as highly unlikely. It is probable that the CDC share of costs stipulated above would increase should this be the case, but this has not been confirmed. Additionally the final cost of the MDC building is not yet finalised, but should be in the next few months.

The rental for building space in a building of the size and value with provisions of resources that MDC are proposing, is a fair cost. However, the need for these facilities from a CDC point of view, who do not have plans to house staff on-site, are more than what is required.

The alternative is for CDC to continue with the plans to build an animal facility within the specified budget.

A CDC facility will be built in accordance with the Building Act requiring the building to have a life of no less than 50 years. Recouping the cost of the building would be within a ten-year comparison of rental costs.

7. NEXT STEPS

Officer recommendation is to work through the procurement process with the design and specification for an animal facility at Dalefield Road.

8. CONSIDERATIONS

8.1 Climate change

Climate implications with additional travel time for the MDC space compared to construction emissions have not been calculated.

8.2 Tāngata whenua

N/A

8.3 Financial impact

Financial implications will depend on the decision outcome.

An access and use agreement with MDC will increase operational costs for animal management, which are not included in our current LTP budget. Continuing with a CDC animal facility is consistent with the LTP budgets.

8.4 Community Engagement requirements

N/A

8.5 Risks

Further decision delays will likely increase final building costs

9. Recommendation

That the Committee:

1. Receives the report

2. Agrees to progress the procurement process for a Carterton District Council animal facility

File Number: 136065

Author: Dave Gittings, Infrastructure, Planning and Regulatory Manager

Attachments: Nil

Section	Location	Existing speed limit	New speed limit
3	240m southwest of Somerset Road to 205m southwest of Andersons Line	70	70
4	205m southwest of Andersons Line to 130m northeast of the SH2 / Belvedere Road / Park Road roundabout	50	50
5	130m northeast of the SH2 / Belvedere Road / Park Road roundabout to 10m south of Seddon Street	50	40
6	10m south of Seddon Street to 50m southwest of Portland Road (current 50/100 change point)	50	50
6a	40m north of Richmond Road to 70m northeast of Moreton Road	50 (40 School Zone)	50 (30 or 40 School Zone)
7	50m southwest of Portland Road to 550m north-east of Hupenui Road. Current passing lane becomes a slow vehicle lane with wide centreline.	100	80

Policy and Strategy Committee Meeting Agenda

29 September 2021

6.5 Dust Suppression Policy

1. Purpose

For the committee to review a draft Council dust suppression policy

2. Significance

The matters for decision in this report are not considered to be of significance under the Significance and Engagement Policy.

3. Policy update

On the 4th August 2021 The Policy and Strategy Committee reviewed the dust suppression policy and asked for two amendments be made and the policy returned to the Committee for approval. The two amendments were to the life cycle of the Otta seal and Council’s contribution.

4. Background

Carterton District has 158km of unsealed roads with many being no-exit or lengthy, winding roads, serving small numbers of houses and farms. However, some roads have been experiencing increased traffic in recent years, due to an increase in population in some localities but also increased logging activity, as pine plantations in the District reach maturity and need to be harvested.

Unsealed roads can cause problems for homeowners living along those roads, mainly due to the dust generated by vehicles that use the road. For this reason, Council is often approached by members of the community requesting that specific roads are sealed. However, sealing roads is expensive costing between $300,000 and $400,000 to seal just one kilometre of road, dependent on factors such as existing surface geometry, condition, width and drainage.

As an alternative to a seal extension policy this dust suppression policy provides a more affordable option.

Property owners with houses adjacent to metal roads may apply to Council for dust suppressant adjacent to their property for a maximum length of 100 metres (minimum 50m). Council will determine the need for dust suppression or sealing using the Waka Kotahi Site Dust Risk Factors and Scores Matrix (Attachment 1) to inform its decision as to whether or not to contribute financially to the works. Council will consider its own contribution to funding in light of the funds available, the criteria above being met and where external funding is available.

5. Determining the need for dust suppression

In 2016 the NZ transport agency released an ‘impacts of dust from unsealed roads report. The report has provided the basis for a methodology to pragmatically assess the level of health risk associated with individual unsealed roads. Undertaking an assessment using the framework produces a numerical output which can then be used to determine the relative risk of harm to human health from unsealed roads.

6. Site dust Risk factors and scores

Risk factors and scores are set out in Waka Kotahi General Circular Investment: Circular 16/04 which references vehicle movements, number of dwellings per kilometre, and sensitive locations. A total desk top risk factor score is derived from the listed factors ranging from 0 to 28 with associated recommended actions. The Total Risk category is reproduced below.

Total Dust Risk	Dusk Risk category	Potential benefit	Actions to be taken
0 to 9	Low	Little of no benefit	End of process
10 to 19	Medium	Some benefit	Repeat with Site specific information
20 to 29	High	Likely to be beneficial	Assess mitigation suitability

· If score is 9 and below: Council will not fund 100m of semi-permanent seal.

· If score is 10 - 19: Council will consider part funding 100m of semi-permanent seal.

· If score is 20 - 28: Council will consider part funding 100m of semi-permanent sealing subject to Annual Plan & LTP funding allocation and/or Waka Kotahi contributions

· Additional Dust Mitigation measures: Temporary lower speed limits may be enacted where CDC is aware of seasonal heavy vehicle traffic such as forestry harvesting, as a way of reducing dust and damage to metal roads.

7. Otta seal

A 2004 trial of the Otta seal technique in various locations in New Zealand showed that it was a better option for dust minimisation and, based on life cycle costing, a lower-cost option when compared with traditional short-term dust palliatives.

The technique is called ‘Otta seal’ because it was first developed and trialed in the Otta Valley in Norway, in 1963, as an inexpensive seal-extension treatment. After its initial success in the Norwegian trial, the use of the treatment spread throughout developing countries in Asia and Africa.

The current Dust Suppression Policy limits options to an Otta seal where appropriate for the road. The cost for an Otta seal is approximately $15 per square meter and will depend upon what work needs to be undertaken prior to sealing (usually just grading) and road width. Based on this number, a 100-meter section of a 4-metre-wide road the cost would be approximately $6,000.

It is expected the Otta sealing would have a lifespan of nine to 11 years

8. Residents contribution

CDC will contribute to the dust suppression sealing subject to Long-term and Annual Plan funding and Waka Kotahi contributions.

The benefit of dust suppression along lengths of unsealed road will principally be with the dwelling occupant and as such there is an expectation that they contribute to their benefit. It is expected that the applicant will pay the following contribution to the Otta seal work.

· Scores 0 - 9 a resident can fully fund the cost

· Scores 10-19 Council will part fund up to 50% of costs

· Scores 20-29 Council will part fund up to 75% of costs of the balance following Waka Kotahi contributions

Requests will be prioritised based on highest scores, and the available budget in the year.

9. Applications

An appropriate application form will be drafted requiring applicants to specify the road and road area that is being applied for as well as a permission from any affected parties.

Allocated costs will be agreed to and signed for by the applicant.

10. CONSIDERATIONS

10.1 Climate change

There are no climate implications for this report but with climate change the occurrence of dust nuisance may increase over time

10.2 Tāngata whenua

No specific implications for Tāngata whenua

10.3 Financial impact

The draft dust suppression policy has not been allowed for in the new three-year Waka Kotahi funding round

10.4 Community Engagement requirements

None for this report

10.5 Risks

There are potential risks in not being able to undertake the work within residents time expectations.

11. Recommendation

That the Committee:

1. Receives the report

2. Adopts the dust suppression Policy for Carterton District Council to take effect following the adoption of the 2022/23 Annual Plan

File Number: 136275

Author: Dave Gittings, Infrastructure, Planning and Regulatory Manager

Attachments: 1. Dust Risk Factors and Scores Matrix ⇩

Policy and Strategy Committee Meeting Agenda

29 September 2021

6.6 Wairarapa Economic Development Arrangements

1. Purpose

For the Committee to agree to proceed with Option 2 as the new economic development arrangements for Wairarapa.

2. Significance

The matters for decision in this report are not considered to be of significance under the Significance and Engagement Policy.

3. Background

In June 2020, a review was commissioned on behalf of the three Wairarapa Councils, to consider the arrangements for economic development in the Wairarapa and to consider the case for changing the current arrangements.

The review identified the status quo is no longer sufficient and that new arrangements are needed to respond to the economic implications of the significant changes that are now facing local government across New Zealand, including the three waters agenda, the reform of the RMA, the future of local government review and the replacement of the Provincial Growth Fund with a new Regional Strategic Partnership Fund.

In addition, there is also a need to consider the implications associated with the establishment of the new Wellington Regional Leadership Committee, the development of a new Wellington Regional Economic Strategy, and the appointment of a new independent chair for the Wairarapa Economic Development Strategy and Action Plan, as well as the ongoing impacts of the Covid-19 pandemic.

Together, these developments all reinforce the need of a pragmatic set of economic development arrangements that can deliver on current priorities and flexibly respond to anticipated changes, without ruling out the need for further refinements in the future.

4. Analysis and advise

The final report, which was completed in September 2020, identified several alternative delivery arrangements for economic development and recommended that a new Wairarapa Economic Development Agency, incorporating both economic development and destination marketing activities, should be established as a joint CCO.

The report also identified a programme of work that would be required to implement this option including the need for upfront investment in the establishment and operation of the new CCO, as well as the need for further consultation with impacted organisations.

Upon consideration of the report and the recommendations, it was not possible to reach unanimous agreement across the Councils and the decision was taken not to pursue the establishment of a new CCO.

Further work was undertaken to explore the possibility of entering a Service Level Agreement or Contract for Services arrangement with WellingtonNZ, which would see integrated economic development and destination management activities provided across the Wairarapa through a local office. This proposal would cover economic development and tourism investment from the three Wairarapa District Councils, including the current investment into Destination Wairarapa, the WEDSAP and a proportion of Greater Wellington Regional Council’s targeted rate for economic development which is used to fund WellingtonNZ’s regional activities.

Under this proposal, WellingtonNZ would also continue to carry out its current regional activities, including those that relate to the Wairarapa (for example, international destination marketing) and would provide the back-office support associated with establishment of a local office in the Wairarapa. Key to the proposed arrangements are that Destination Wairarapa would retain its RTO status and that its brand would remain visible.

Advice on the proposal was provided to the Wairarapa District Councils by Martin Jenkins based on whether and how such an arrangement would be workable, identifying the risks, opportunities and benefits, as well as the implications of the arrangements for Destination Wairarapa and for the governance of council investment into economic development and tourism activities.

a result of the review, Council Chief Executives explored the possibility of entering a Service Level Agreement or Contract for Services arrangement with WellingtonNZ, which would see integrated economic development and destination management activities provided across the Wairarapa through a local office.

It was proposed that the service agreement would cover economic development and tourism investment from the three Wairarapa Councils, including the current investment into Destination Wairarapa, the Wairarapa Economic Development Strategy and Action Plan (WEDSAP) and a proportion of Greater Wellington Regional Council’s targeted rate for economic development which is used to fund WellingtonNZ’s regional activities.

WellingtonNZ would also continue to carry out its current regional activities, including those that relate to the Wairarapa (for example, international destination marketing) and would provide the back-office support associated with establishment of a local office in the Wairarapa. Key to the proposed arrangements are that Destination Wairarapa would retain its RTO status and that its brand would remain visible.

Advice on the proposal was provided to the Wairarapa councils by Martin Jenkins based on whether and how such an arrangement would be workable, identifying the risks, opportunities and benefits, as well as the implications of the arrangements for Destination Wairarapa and for the governance of council investment into economic development and tourism activities (Attachment 1).

5. OPtions

Two options have been identified for implementing the proposal through a service level agreement (SLA):

Option 1: Destination Wairarapa becomes a team within WellingtonNZ and WellingtonNZ is responsible for the delivery of all destination and economic development activities.

Option 2: Destination Wairarapa remains as a separate entity but WellingtonNZ establishes a presence in the Wairarapa and provides back-office support.

The advantages, disadvantages, and risks are outlined in (Attachment 1).

Option 2 is recommended. Under this option, the three Wairarapa District Councils would work with both entities under a Service Level Agreement arrangement that would involve:

· Destination Wairarapa to provide local marketing and promotion services.

· WellingtonNZ to provide economic development services and international marketing services for the Wairarapa, including a physical presence, and back-office services to underpin this and for Destination Wairarapa.

Under this model, Destination Wairarapa would continue as a separate RTO, as an incorporated society and with its own Board (noting that Destination Wairarapa is also a Council organisation).

The main differences to the status quo under this model would be that WellingtonNZ would provide additional economic development services and have staff in the Wairarapa, co-located with Destination Wairarapa, operating through a Service Level Agreement with the three Wairarapa District Councils. Currently WellingtonNZ delivers activities in the Wairarapa through the targeted regional rate and under its agreement with Greater Wellington Regional Council and Wellington City Council.

The main advantages of this option are that it is relatively straightforward to implement and limits the risk of a drop-off in destination funding. Destination Wairarapa can retain its existing membership base, sponsorship, expertise and identity. There is no need for or risk of a drawn-out consultation and disestablishment process.

This option has advantages in that it also draws on the existing resources, capability and processes of WellingtonNZ and expands their reach and services into the Wairarapa. The Service Level Agreement would enable Councils to be more specific about the economic development activities they want delivered in the region through WellingtonNZ. In addition, the Councils will maintain oversight and governance influence over DW given it retains its CO status.

There may be some efficiencies from WellingtonNZ taking over some back-office functions of Destination Wairarapa given that it has greater scale and has likely more efficient operational processes.

Current perceptions about WellingtonNZ support not being sufficiently tailored to the region may be mitigated under this option through there being both a physical presence and Destination Wairarapa being maintained as a separate entity.

6. next steps

If all three Wairarapa District Councils agree on Option 2: Destination Wairarapa remains as a separate entity but WellingtonNZ establishes a presence in the Wairarapa and provides back-office support, next steps will involve:

· The development of a Service Level Agreement between the three Wairarapa District Councils and Destination Wairarapa;

· The development of a Service Level Agreement between the three Wairarapa District Councils and WellingtonNZ;

· Confirmation of cost share arrangements by the three Wairarapa District Councils including confirming the proportion of funding from the regional rate that would be allocated to support Wairarapa specific activities and the mechanism/s for this to occur.

7. CONSIDERATIONS

7.1 Climate change

The decision is not considered to have climate change impacts.

7.2 Tāngata whenua

While local iwi representatives did not comment on the proposal, there are existing relationships with councils and Destination Wairarapa, and recognised economic and cultural opportunities and benefits for mana whenua.

7.3 Financial impact

The three Wairarapa District Councils will need to confirm a cost share arrangement as part of the development of the new Service Level Agreements with both Destination Wairarapa and WellingtonNZ. This will include a review of the current funding arrangements with Destination Wairarapa and confirming the proportion of funding from the regional rate that would be allocated to support Wairarapa specific activities and the mechanism/s for this to occur.

7.4 Community Engagement requirements

Officers consider that the matters for decision in this report are not considered to be of significance under the Significance and Engagement Policy.

Iwi Chairs and key stakeholders, including Destination Wairarapa and WellingtonNZ have been either invited and/or participated in the review process.

7.5 Risks

As outlined in Attachment 1.

8. Recommendation

That the Committee:

1. Receives the report.

2. Notes that a review of the current economic development arrangements in the Wairarapa, commissioned by the three Wairarapa District Councils, is complete;

3. Agrees to proceed with Option 2: Destination Wairarapa remains as a separate entity but WellingtonNZ establishes a presence in the Wairarapa and provides back-office support;

4. Notes that joint agreement by the three Wairarapa District Councils is required to move forward with Option 2: Destination Wairarapa remains as a separate entity but WellingtonNZ establishes a presence in the Wairarapa and provides back-office support;

5. Notes that the above option will require the development of Service Level Agreements between the three Wairarapa District Councils and Destination Wairarapa, and the three Wairarapa District Councils and WellingtonNZ; and

6. Notes that that a new Service Level Agreement between the three Wairarapa District Councils and Destination Wairarapa will supersede the current Memorandum of Understanding between the three Wairarapa District Councils and Destination Wairarapa.

File Number: 136278

Author: Glenda Seville, Community Services Manager

Attachments: 1. Wairarapa Economic Development Arrangements - MJ Review June 2021 ⇩


AGENDA Policy and Strategy Committee Meeting
Date:	Wednesday, 29 September 2021
Time:	11.00am
Location:	Carterton Events Centre 50 Holloway Street Carterton
Chair R Vergunst Deputy Chair R Cherry-Campbell Mayor G Lang Cr S Cretney Cr B Deller	Cr J Greathead Cr R Keys Cr R Stockley Cr D Williams Hurunui-o-Rangi Marae Representative R Clarke-Reiri