Late Reports Agenda of Extraordinary Council meeting

2	15 May 2024

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6.3 Changes to the Long-Term Plan Post Consultation

1. Purpose

For Council to be updated on legal advice received regarding changes to the Long-Term Plan (LTP) post-consultation.

2. Significance

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

3. Background

Subsequent to adopting the Long-term Plan (LTP) Consultation document and supporting information the Council updated the draft LTP and associated LTP budgets as new information came to light. This had led to several changes:

· The addition of the Waingawa Water Project, which was approved by Council immediately following adoption of the draft LTP and Consultation Document.

· Changes identified by the Council’s Auditors, which include insurance costs, loan interest rates assumptions, and associated loan interest expense, and

· Refreshed Opening Balances for certain Capital projects and Loans.

· Updating of the corporate overhead allocation model.

(Together these are the “Changes”)

The updating of corporate overhead allocation was subsequently clarified to have been included in the Draft LTP and Consultation Documents.

The effect of the review of the draft LTP budgets and incorporation of the changes was to increase the Council’s average rates increase for the 2024/2025 year from 15.09% (being the number consulted on and set out in the CD) to 17.5%.

Further adjustments identified moderate the Changes (the “Moderating Options”) mitigating the impact on Council’s average rates for the 2024/25 year to approximately 14.7%, or a 0.4% reduction from 15.09%.

4. Discussion

Council sought legal advice on four questions with respect to the impact of the Changes and Moderating Options on the LTP, and the consultation undertaken on the Draft LTP. Simpson Grierson was selected to provide this advice.

The questions are shown below. The summary level legal advice received is shown indented and in italics:

Q1: Are the Changes, if adopted and incorporated into the LTP, significant enough to invalidate consultation on the draft LTP?

No. In our view, the Changes – separately or collectively - are not of a nature or degree that would warrant consultation as part of an LTP process. If the Changes are adopted by the Council and incorporated into the final LTP, we do not consider that this would invalidate consultation.

Q2: Are the Changes significant enough to require further consultation?

No. In our view the Changes (and their related context) do not warrant any further consultation, as they are not matters that would be expected to be included in a CD (as significant, or important) in terms of section 93C(2)(a) of the Local Government Act 2002 (LGA).

When considered alongside the proposed Moderating options, which will reduce average rates so that there is no actual increase from the level initially consulted on, our view is that there is a low risk of challenge if there is no further consultation.

Q3: Does the LTP CD, without the Changes, satisfy section 93B of the LGA?

Yes. We consider that the LTP CD adopted by the Council has complied with section 93B of the LGA. In our view, including the Changes (and/or Moderating options) when adopting the final LTP will not impact on this assessment.

For completeness, we note that because of the transitional provisions now included in the LGA, the CD for the 2024-2034 LTP process can be unaudited. Given those provisions, there is no specific requirement to assess compliance with section 93B, with the audit focus instead being on whether the final LTP satisfies the requirements of section 93(6) of the LGA.

Q4: Are any other process options available to the Council, for example the Enhanced Annual Plan or late adoption?

As part of the repeal of the “Affordable Waters” legislation, transitional provisions were introduced into the LGA that provide two alternative options for the 2024 LTP. These options involve either a 3-month extension for the LTP, or a 12-month deferral of the LTP with an Enhanced Annual Plan required instead. Both involve legal, practical and timing complexities.

The complete advice from Simpson Grierson is attached in Attachment 1.

In summary, the advice confirms there does not appear to be any legal impediment to progressing the adoption of Councils Long-Term Plan as scheduled.

5. Recommendation

That the Council:

1. Receives the report.

File Number: 401085

Author: Geoff Hamilton, Chief Executive

Attachments: 1. Legal advice from Simpson Grierson re changes to the LTP ⇩

Extraordinary Council meeting Agenda

15 May 2024

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6.4 Deliberation decisions for the 2024-2034 Long-Term Plan

1. Purpose

The purpose of this report is for Council to receive from the Long-Term Plan (LTP) Hearings Committee the decisions from Deliberations.

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 Hearings Committee convened on 15,16 and 22 May 2024 to receive the public LTP submissions, hear the oral submissions and deliberate.

4. Discussion

The discussions on the LTP considerations and submissions are fully outlined in the minutes accompanying this agenda.

5. Deliberations

Consultation Item 1 - Transportation	Agreed	Option 2
Consultation Item 2 – Waste Water Treatment Plant	Agreed	Option 2
Cycle Trails	Agreed	That sufficient funding up to $815k is put in the LTP to scope and design the cycle trail from River Road at Matarawa to Clareville, noting there is no impact on ratepayers. This is comprised of $520k Better Off Funding and $295k c/fwd.	$815,000
Destination Wairarapa	Agreed	That CDC continues with the existing Destination Wairarapa contract and will review in September 2025 aligining with other local councils.
Carterton Indoor Pool		CDC can provide “in kind” support such as with use of the Events Centre and the provision of resource consents at no cost.	No funding
Water Storage Project			No funding
Wairarapa Water Resilience Strategy	Agreed	Fund the Wairarapa Water Resilience Strategy $25k per annum for three years as part of the LTP.	$25,000 3 years
Business Wairarapa		CDC continues with the existing funding to Business Wairarapa for a one-year term with the proviso to align with other councils after that. NO VOTE AS THIS IS EXISTING FUNDING
Go Carterton	Agreed	That Go Carterton receives $10K for Space Week. This funding is from the Economic Development budget, and is subject to satisfying the same criteria used in the Grants Committee process.	$10,000 From the Economic Devpt budget
Carterton District Historical Society		Up to $12k for rent not approved. They are encouraged to apply to the Community Grants Committee, noting community grants funding can’t be approved for rent, but can go towards other operational costs.	No funding
Wellington Free Ambulance		Both the motion to fund WFA at $1 per person in Carterton ($10,500), and $3,00O per annum (as per currently via the Community Grants fund) were declined.	No funding
Enviro Schools	Agreed	That Enviro Schoolsreceives $10k per year for three years out of the Community Grants pool using the Waste Levy.	$10,000 Waste Levy
Victoria University		Funding of $9,429k toward a National Music School was declined.	No funding
Wairarapa Forest and Bird		Funding not sought. CDC will continue to work with the Group and will come back to Council at a later date with a partnership agreement.
Five Towns Trail Trust		The Five Towns Trail Trust is requesting operational costs, $20k per year until 2027. MOTION FAILED	No additional funding
Operations Depot	Agreed	$150k for Year 1 and no funding for Year 2.	$150k Year 1
Library self-issue machines (RFID)-Capex	Agreed	To fund RFID self-issue machines.	No change
Library Workroom		Additional Budget request MOTION FAILED	No additonal funding
Events Centre Carpet replacement-Capex	Agreed	To fund carpet replacement beginning in Yr 3 for three years.	$106k
Auditorium floor sand and varnish-Capex	Agreed	To fund the auditorium floor sand and varnish – Year 2.	No change to capex
Cyclorama auditorium projector-Capex	Agreed	To fund the cyclorama auditorium projector from Yr3 to Yr 4	$71.4k
Sound system renewal-Capex	Agreed	To fund the sound system renewal split over years 1 & 2 .	$145.4k
Fly winch system renewal-Capex	Agreed	To fund the fly winch system renewal split across years 3 & 4.	$78.1k Yr1 $92.7k Yr2
Theatrical lighting improvements-Capex	Agreed	To fund theatrical lighting improvements – split over years 1, 2, and 3. $69k Yr1, $72.2k Yr2, $66.6k Yr3	No change
De-sludging of the WWTP Ponds	Status Quo	The pond cleaning is scheduled for Year 1.	No change
New external funding to be allocated-Opex	Agreed	That $250k from projects in the Wairarapa Combined District Plan is re-allocated to Opex.

6. NEXT STEPS

Further to the Hearings Committee on Wednesday 22 May, the options agreed in deliberations and further financial adjustments also agreed to the LTP, these changes have now been reflected in a revised forecasted rates increase as below:

	The Plan Year 1 2024/2025	The Plan Year 2 2025/2026	The Plan Year 3 2026/2027	Three-year average	Years 4-10 average
Consultation Doc	15.6%	8.5%	13.0%	12.4%	3.3%

Revised 27.05.24	13.5%	11.9%	12.5%	12.6%	3.2%

The numbers above do not allow for growth in the rating database. The consultation document outlined a proposed average rates increase of 15.6%, adjusted for growth was 15.09%.

The growth factor and impact on the rates increase will form part of the final LTP calculations including recent updates from QV for the setting the rates on 1 July 2024, after the Adoption of the LTP on the 26 June 2024.

7. CONSIDERATIONS

7.1 Climate change

There are no direct climate change considerations related to the decisions in this report.

7.2 Tāngata whenua

Tāngata whenua will be interested in the decisions made by the Hearings Committee, however there are no direct implications for tāngata related to the decisions in this report.

7.3 Financial impact

This is discussed in the body of this report.

7.4 Community Engagement requirements

Community consultation was undertaken as part of the consultation process in March 2024.

7.5 Risks

The risks were identified in the paper entitled ‘2024-34 Long-Term Changes Post-Consultation’ which was tabled on the agenda of the Hearings Committee Deliberations meeting on 22 May 2024.

8. Recommendation

That the Council:

1. Receives the report.

2. Accepts the decisions from the Hearings Committee deliberations on the Long-Term Plan and the Rates Remission and Postponement Policies.

3. Instructs the Chief Executive to reflect the decisions in an updated draft Long Term Plan and Rates Remission and Postponement Policy for consideration at the 26 June 2024 Council meeting.

4. Notes the redrafted Long-Term Plan will be audited by Audit New Zealand ahead of the Council’s meeting on 26 June 2024.

File Number: 401090

Author: Karon Ashforth, Corporate Services Manager

Attachments: Nil