5 Reports
22.5.30 Water
Services Entities Bill
Doc ID: 585275
1. Purpose
of Report
To consider preparing a
submission on the Water Services Entities Bill and the implications of this on
Council management of water services (water, wastewater and stormwater) during
the reform transition period.
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Recommendations
That the Council
A. Receives
the report and accepts the level of significance.
B. Agrees that a
submission to the Water Services Entities Bill be drafted and circulated to
Councillors for feedback and finalising prior to 22 July.
C. Agrees that the
submission will be ratified at the Council meeting on 24 August 2022.
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2. Background
The Water Services
Entities Bill (the Bill) was introduced on 2 June 2022 and had its first
reading in Parliament on 9 June 2022. The Bill is now in Select Committee
and submissions opened on 22 June, with a closing date of 22 July 2022.
The Bill will establish
four publicly owned water services entities that will provide water services in
place of local authorities. The Bill contains the ownership, governance, and
accountability arrangements relating to those entities, and provides for
transitional arrangements during an establishment period. The entities will
commence delivery of services on 1 July 2024.
Each of the four Water
Services Entities has been named after its geographical location, Northern,
Western-Central, Eastern-Central, and Southern. Each Council has been
placed in an entity, with Southern following the boundaries of the takiwā
of Ngāi Tahu.
This Bill is just one
component of a comprehensive package to reform water services that are
currently provided by local authorities. The Bill will need to be followed by
further legislation to provide for:
· additional,
detailed implementation arrangements for the entities and service delivery,
including provisions relating to the transfer of assets, liabilities, and other
matters from local authorities to new water services entities;
· specific powers,
functions, and responsibilities of the new water services entities, and pricing
and charging arrangements;
· economic
regulation and consumer protection regimes relating to the new water services
system;
· any changes to
Treaty settlement legislation that are required to ensure that settlement
obligations are carried forward from territorial authorities to the new water
services entities;
· detailed changes
to the Local Government Act 2002, the Water Services Act 2021, and other
legislation to transfer service delivery arrangements to the new water services
entities.
The Bill is complex and
requires a range of expertise to adequately review the proposed legislation and
provide informed feedback. For the purposes of this report, Central Otago
District staff analysis has been limited to providing an outline of the Bill,
the implications of the transitional requirements on Council, and analysis of
the Bill against the feedback provided by Central Otago District Council to
Local Government New Zealand on the Government Three Waters Reform Proposal in
August 2021.
3. Overview
of Transitional Requirements
Schedule 1 of the Bill
contains the transitional, savings and related provisions. This has been
reviewed by council officers to understand the operational implications of this
on Council.
Appointment of the
Establishment Board and Chief Executive
The Minister has additional
responsibilities during the establishment period to oversee the establishment
of the entities. This role includes the function and power to appoint and
remove members of the establishment board of each entity.
The Department of
Internal Affairs are responsible for appointing an establishment chief
executive to each entity. The establishment chief executive role can
extend up to 1 July 2026.
Transfer of Assets,
Functions, Liabilities, Staff and Other Matters to the Entity
The establishment chief
executive is required to prepare an allocation schedule. This schedule is
required to specify assets, liabilities, and other matters that relate wholly
or partly to the provision of water services by council. Where these
relate partly to water services, then the schedule needs to identify which
other council services they relate to.
The Department of
Internal Affairs may prepare an establishment plan for an entity. The plan must
include:
a) the
processes, policies, and guidance for identifying the functions, staff, and
assets, liabilities, and other matters to be transferred to the entity; and
b) the
proposed timing for the transfer of functions, staff, and assets, liabilities,
and other matters to the entity; and
c) the
reporting requirements for the quarterly reports to be provided to the
Department of Internal Affairs.
It may also include any
other matters the Minister considers relevant.
Planning for Work
beyond 1 July 2024
The entity is required
to prepare an asset management plan and funding and pricing plan during the
establishment period. The draft plans are required to be prepared by 1
July 2023.
The requirements of the
Bill relating to engagement with consumers and stakeholders on the asset
management plan and funding and pricing plan do not apply to the first plans
prepared during the transition period. Subsequent asset management and
funding and pricing plans are required to be prepared every three years and
cover a 10-year period, and have requirements regarding engagement with
councils, consumers and communities.
Council is required to
co-operate with the Southern Water Services Entity to facilitate the water
services reform. This includes complying with any reasonable request for:
· Council employees
to be seconded to the entity, and
· Provision of
information held by council that may be necessary or desirable for preparing
the allocation schedule. This includes a requirement to collate
information, provide information in a particular format, or disclose current
pricing information or indicative water charges on invoices during the
establishment period.
If a council fails to
comply, then the Department of Internal Affairs may apply to the District Court
for an order to compel the council to comply.
The Bill includes exceptions
to the Local Government Act 2002 requirements relating to requirements for
councils to consult on significant or material variations to its long-term
plan, annual plan, and obligations to maintain water services.
Transitional Matters
Relating to Employment
The Bill includes
requirements on the Department of Internal Affairs, and the new entities
relating to the employment of staff who are employed by council on water
services.
This includes the entity
being required to offer an employee of a council an employment position when
the primary functions of the role will transfer to the new entity, provided the
employee does not have a senior management role.
Where an employee
transitions to a role in the new entity, the terms and conditions of the position
offered must:
· Involve the same
or similar duties and responsibilities.
· Core terms no less
favourable than existed immediately before being identified as a staff member
for transition by the entity. Core terms includes salary, leave
entitlement, and redundancy compensation.
· Be in the same
general locality or within reasonable commute of the current location of work.
· Involve similar
hours and days of work.
· Recognise the
transition to the entity as if it were continuous service.
Employment with the entity will commence on 1 July 2024.
Staff have no obligation
to accept an offer from the new entity. Where staff do not accept an
offer, then they will not be eligible for any compensation if council no longer
has a role for them. The entity can also offer positions to others.
Transitional
Arrangements relating to Oversight of Council Decisions
During the establishment
period the Department of Internal Affairs must review Council’s decisions
and meeting agendas. The Department must be provided with information of
an intended decision that relates to the provision or may affect the provision
of water services. Council’s chief executive must ensure that any
decision of Council relating to water services is confirmed by the Department
of Internal Affairs in writing before it is implemented.
This applies to a
decision that may, directly or because of its consequences:
a) significantly
prejudice the water services reform; or
b) significantly
constrain the powers or capacity of the water services entities following
reform; or
c) have
a significant negative impact on the assets, liabilities, or other matters that
are transferred to the water services entities as a result of the water
services reform.
This includes a decision
to:
· To adopt or amend a Long-Term Plan or to adopt an Annual
Plan.
· To adopt a policy required by the Local Government
Act 2002.
· That is significantly inconsistent with any policy
or plan adopted by council under the Local Government Act 2002.
· To purchase or dispose of assets other than in
accordance with its Long-Term Plan.
· To purchase or dispose of an asset if the purchase
or disposal will have a material impact on the capacity to provide water
services or the financial well-being of the organisation.
· To enter any contract (other than employment) that
imposes or will continue to impose any obligation on the council after a date,
and for an amount to be set by the chief executive of the Department of
Internal Affairs.
· To borrow money for a period that extends beyond a
date set by the chief executive of the Department of Internal Affairs.
4. Discussion
Local Government New
Zealand, and Taituarā are preparing submissions on behalf of local
government. The Otago and Southland councils have also agreed to share
their draft submissions, and common themes from these will be collated and
shared. All organisations are currently working on their review and
submission outlines, and there is limited information available to share on 6
July.
Council
provided feedback to Local Government New Zealand in 2021 as part of the
Consultative process regarding the Governments Three Waters Reform Proposal at
that time. This is attached in Appendix 1 and covers the following
headings. How the Bill addresses these concerns (or not) is outlined
below:
Privatisation –
The entities will be a body corporate, and a separate entity that is co-owned
by the local authorities within the entity area. Each local authority
will have shares allocated, based on 1 share per 50,000 population, or part
thereof. A proposal to divest the ownership is required to be supported
by a majority of 75% of the Regional Representative Group, in order to then be
referred to the local authority owners. The local authorities must then
unanimously agree to refer the proposal to the Local Government Commission to
poll electors in the entity area. There is required to be a majority of
75% votes in support of divestment. The provisions within the Bill are
considered to cover the risk of privatisation. The remaining concern is
that subsequent Governments could change this approach.
Meeting the Needs of
Growth – this is covered through several mechanisms in the
Bill. These include the requirement to partner and engage early and
meaningfully with local authorities, and co-operating with and supporting local
authorities, and other infrastructure providers.
The entities are also
required to prepare an asset management plan, and a 30- year infrastructure
strategy, as suggested in council’s feedback. While there is no
explicit mention of responding to growth in the Bill, consideration of growth
is a core input into the development of asset management plans and
infrastructure strategies.
The annual report is
also specifically required to separate the actual and budgeted expenditure
required to meet increased demand (growth), improve level of service
performance, and replace assets. This would provide the basis for a
funding mechanism like development contributions to be included in further
legislation relating to pricing and charging.
Consumer Protections,
Standardised Charging, and Local Procurement – these fall outside of
the scope of this Bill, and would more appropriately sit in other proposed
legislation that will follow relating to:
· Specific powers,
functions, and responsibilities of the new water services entities, and pricing
and charging arrangements.
· Economic
regulation and consumer protection regimes relating to the new water services
system.
Rating Legislation
– The issues that council raised relating to the uniform annual charge
30% cap has not been addressed, and no reference to changes to Rating
Legislation have been proposed. This should continue to be highlighted in
Councils’ submission to the Bill.
Governance -
There will be a regional representative group for each entity which will be
responsible for appointing and removing the entity board members (using a board
appointment committee), participating in setting strategic direction and
performance expectations of the entity, and reviewing performance.
Councils may only
appoint people to the regional representative group who are elected members,
chief executives, or senior managers of councils. Each regional
representative group will have between 12 and 14 people, and an equal number of
council and mana whenua representatives.
The proposals in the
Bill do not extend to specifying that the members must reflect both the rural
and urban communities they represent, and Council may wish to submit again on
this. The other suggestions that council provided regarding the
eligibility for appointment have been included.
Local
Government New Zealand Submission
An outline of the Local
Government New Zealand proposed submission has been circulated to councils and
is attached in Appendix 2. One of the suggestions from Local Government
New Zealand is that the transition of councils into the new entity be staged,
along with stormwater functions. Council officers suggest that this
approach could be detrimental to staff wellbeing and morale and would impact on
the retention and recruitment of staff due to an increased period of
uncertainty. The new entities would also require resourcing at the same
time, which would put increased demand on an already resource constrained industry.
Council has negotiated
an interim maintenance contract arrangements in place to cover the transition
period. Extending the transition period would place further uncertainty
on the duration of this contract which will impact on contractor investment into
the contract resourcing.
There are onerous
reporting and approval processes placed on council during the transition period
which will increase timeframes to implement decisions. Staging the
transition of councils into the new entities would increase the period that
council would be working under the oversight of the Department of Internal
Affairs.
5. Financial
Considerations
It is anticipated that there will be funding
provided to councils to cover the costs of extra staff to provide the required
information and to be seconded to the establishment entities. We are
unsure as to the amount to be provided, but this may not meet the costs of
engaging consultants and contractors to backfill existing staff roles in
business as usual while they do this work.
This additional work could potentially be funded as
an operational overspend against the water services budgets. Depending on
the significance of this amount, it may require the written approval of the
Department of Internal Affairs.
6. Options
Option 1 –
(Recommended)
Council prepares a
submission to the Water Services Entities, using the submissions prepared by
Local Government New Zealand, Taituarā, Central Otago District Council
Mayor, and other Otago/Southland councils as a starting point. This
submission would be circulated to councillors for agreement prior to 15 July.
Advantages:
· Enables
council to utilise the specialist expertise that is available in these
organisations to help formulate its submission.
· Where
there are different viewpoints then these will.
Disadvantages:
· There
will be a short timeframe of one week for councillors to provide comment on the
submission and have the submission amended.
Option 2
Council does not submit
on the Water Services Bill
Advantages:
· Nil
Disadvantages:
· The
issues that are important to the Central Otago District Council and communities
may not be raised by others.
· Less
weight will be given to the submissions by other Local Government organisations
if councils do not submit in support of these, where appropriate.
7. Compliance
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Local Government Act 2002 Purpose Provisions
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This decision enables democratic local decision making and action
by, and on behalf of communities by ensuring the views of councillors elected
by the community are included in a submission on the Water Services Entities
Bill.
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Decision consistent with other Council plans and policies? Such as
the District Plan, Economic Development Strategy etc.
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Yes
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Considerations as to sustainability, the environment and climate
change impacts
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The water reform is being implemented by government to support
increased investment to respond to sustainability, the environment, and
climate change impacts.
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Risks Analysis
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The Governments Water Reform proposals are controversial and may
not be widely supported within the community. There are members of the
community who may not accept that submitting in order to try and improve
community outcomes from the Bill is acceptable, and may believe that
submitting to not proceed with the reform is the only appropriate response.
Aside from reputational risk, there is minimal risks in submitting
on behalf of the Central Otago community on the Water Services Bill.
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Significance, Consultation and Engagement (internal and external)
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Submitting on the Water
Services Bill does not trigger
Council’s significance and engagement threshold.
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8. Next
Steps
Council
staff will prepare a draft submission for circulating to elected members by 15
July.
Councillors
will provide feedback by 20 July.
The
Final Submission will be drafted incorporating feedback and submitted by 22
July.
9. Attachments
Appendix 1 - Council August 2021
feedback to Local Government New Zealand regarding the Governments Three Waters
Reform Community Consultation Proposal ⇩
Appendix 2 - Local Government New
Zealand Submission Outline ⇩
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Report
author:
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Reviewed
and authorised by:
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Julie
Muir
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Sanchia
Jacobs
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Executive
Manager - Infrastructure Services and Water Reform Lead
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Chief
Executive Officer
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30/06/2022
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1/07/2022
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22.5.31 Three
Waters Reform Better Off Funding (Tranche 1)
Doc ID: 582846
1. Purpose
of Report
To consider projects to
be included in the Funding Proposal for the Three Waters Reform Better Off
Funding (Tranche 1).
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Recommendations
That the Council
A. Receives
the report and accepts the level of significance.
B. Notes that the
Better Off Funding will be split into two tranches, with Tranche 1, $3.21M,
being available from 1 October 2022, and Tranche 2, $9.63M, expected to be
available from 1 July 2024.
C. Notes that to
receive this funding, Council needs to supply a list of projects/initiatives
to the Department of Internal Affairs for approval.
D. Authorises the
Chief Executive to sign the Funding Agreement in Appendix 1.
E. Approves projects
to the value of $3.21M to be put forward in the Funding Proposal.
F. Approves a list
of contingency projects to be included in the Funding Proposal.
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2. Background
Central Government is
undertaking a reform process for Three Waters (water, wastewater, and
stormwater) services which seeks to address significant challenges facing the
delivery of these services. In July 2021, the Government announced the Three
Waters Better Off Support Package, which includes a total of $2 billion of
funding. The $2 billion of funding consists of $1 billion of Crown funding and
$1 billion to be funded from the new Water Services Entities.
The funding allocation
from the Better Off Support Package for Central Otago District Council is
$12.84M with $3.21M of this being available in Tranche 1 from the 1 October
2022, and the remaining $9.63M to be made available in Tranche 2, from the 1
July 2024.
Information was released
about the Better Off funding in April 2022, including how local authorities can
access the funding.
Council does not have to
apply for the full Tranche 1 funding amount. Any funds not applied for in
Tranche 1 will be made available in Tranche 2. However, all the Better Off
funding needs to be spent within five years by the 30 June 2027. This is
regardless of which Tranche the funding is allocated under.
There is a greater risk
of not being able to spend all the money within the 5-year timeframe if the
maximum amount of funding available is not applied for in Tranche 1. Tranche 2
will require a separate application, although it is expected to follow a
similar process.
3. Discussion
To apply for this
funding, council needs to sign the Funding Agreement (Appendix 1) and complete
a Funding Proposal.
Funding Agreement
The Funding Agreement
sets out the terms and conditions of the funding (Appendix 1).
Under the section
General Terms Clause 2.10, the Funding Proposal states that: “The
Recipient must not at any time do anything that could reasonably be expected to
have an adverse effect on the reputation, good standing or goodwill of DIA or
the New Zealand Government. The Recipient must keep DIA informed of any matter
known to the Recipient which could reasonably be expected to have such an
effect.”
The Department of Internal Affairs
has further clarified that: “DIA acknowledges the importance of
councils independently expressing their views of the reform programme. The
Funding Agreement for the better off package does not prevent or prohibit
councils from doing this. For the avoidance of doubt, publicly criticising or
expressing opinions on reform cannot reasonably be expected to have an adverse
effect on the reputation, good standing or goodwill of the Department or the
New Zealand Government, and would not represent a breach of the funding
agreement.”
Under Schedule 2, in
signing the funding agreement council would be agreeing to collaborate and
cooperate with the Department of Internal Affairs, including its National
Transition Unit, to provide for the implementation and carrying out of certain
parts of the Three Waters Reform Programme. In making any requests under this
agreement the Department of Internal Affairs will have regard to available
resources and competing demands on those resources.
Funding Proposal
The Funding Proposal
needs to include a range of details including:
· A
programme overview (including work to be undertaken, summary of costs, relevant
milestones, and dates).
· Demonstration
that engagement was undertaken with Iwi/Māori on the use of funding.
· How
the Programme meets one or more of the better off package funding criteria and
conditions.
· A
brief wellbeing assessment setting out the expected benefits of the Programme.
The programme overview
will need to include projects up to the value of $3.21M to be completed before
30 June 2027. It is recommended that Council also puts forward a list of
contingency projects which can be substituted should any projects come in under
budget or become unlikely to be completed within the required timeframe for any
reason.
Funding Criteria
The Programme must
support one or more of the following Better Off Support Package criteria.
These are:
1. Supporting
communities to transition to a sustainable and low-emissions economy, including
by building resilience to climate change and natural hazards.
2. Delivery
of infrastructure and/or services that enable housing development and growth,
with a focus on brownfield and infill development opportunities where those are
available.
3. Delivery
of infrastructure and/or services that support local place-making and improvements
in community well-being.
It must be used for new
initiatives/projects; and/or to accelerate, scale up and/or enhance the quality
of planned investment. The duration of the Programme Expenditure must be
5 years or less (completion date on or before 30 June 2027). Funding will
only be provided equal to or less than the total funding allocation to
Council. This means that if projects cost more than the difference will
need to be funded by Council.
Iwi/Māori
Engagement
Local authorities are
expected to engage with iwi/Māori in deciding how to use its funding
allocation. For Tranche 1 of the funding, it is expected that genuine
engagement is demonstrated and any issues or concerns arising are identified
and what steps are being taken in response to these.
The requirements for
Tranche 2 are much more extensive. The expectation is that Council will have
built a relationship based on trust and mutual respect and the Funding
Proposals will be co-designed and co-implemented from inception. Iwi/Māori
will also need to be involved in decision-making on initiatives to fund and
prioritisation.
Given
the requirements of the Tranche 2 program of work regarding engagement with
iwi/Māori, significant engagement will need to be undertaken to access
this funding. This work will need to commence in advance of any future Funding
Proposal to allow plenty of time for relationship building and working
together.
Monitoring
and Reporting Requirements
Reporting is required
half-yearly (periods ending 30 June and 31 December). Crown
Infrastructure Partners will monitor progress against the Funding Proposal to
provide assurance that the funding is being spent as intended and that projects
are progressing within a reasonable timeframe. The half-yearly reporting
will also include monitoring of the achievement of outcomes as specified in the
Funding Proposal.
It is important that the
information in the Funding Proposal is robust as council will be reporting
against it throughout the process. It will also be advisable to use a
common project management system for management and regular reporting against
projects to streamline preparation of reports for the Department of Internal
Affairs.
Staff across council
have looked at existing work programmes and proposals that have come to Council
and identified a list of projects that meet one or more of the funding
criteria. Council’s Long-Term Plan either partially or fully funds a
number of these projects. Some new projects have also been identified. If any
project is partially funded by the Long-Term Plan, and delivered within the
same timing as in the Long Term Plan, then only the additional cost can receive
funding.
If projects are being
accelerated, they are eligible for the full funding amount. Accelerating
projects and completely funding them with the Better Off Funding, frees up the
capital budget for other initiatives and/or could lead to future cost savings
for Council.
Tranche 1 of the funding
can also be used to help support investigation and preparation of funding
proposals for Tranche 2. This allows for early investigation and design for
projects where it is more effective to target Tranche 2 funding due to the time
required before the project will be able to commence. The information from this
preliminary work will improve the quality of the information included in the
Tranche 2 Funding Proposal, and will ensure they are ready to commence, and can
be delivered within the 3-year Tranche 2 delivery period.
If projects investigated
or designed during Tranche 1 are not progressed as Tranche 2 projects, then
this information will still be useful for development of the 2024 Long Term
Plan or for applications for other funding sources.
Following experience in delivering the Water Stimulus
work programme, staff have included the following additional factors in the
analysis:
· Readiness to proceed (consent requirements, status
of investigation and design work.
· Risks to delivery (risk of material delays,
resources to deliver, procurement risks and timelines, robustness of estimates,
cost estimate optimism, contingency provisions).
· Future operational or capital cost savings (through
improved efficiency, or accelerating work required in future Long-Term Plan).
· No other potential funding sources available (e.g.
Waka Kotahi, Ministry for Environment).
Failure to meet any of the above criteria is likely
to place increased risks on delivery of the program.
4. Financial
Considerations
Following approval of the Funding Proposal and an
executed Funding Agreement, 10% of the amount will be released. Following this
council can submit a progress payment request, along with a progress report, up to once a month. Further funding will
be released upon approval of this request.
While the water stimulus funding was largely funded
in advance, the Better-Off funding will largely be retrospectively funded in a
similar manner to the way Waka Kotahi fund roading.
The Department of Internal Affairs will not increase
the funding allocation if projects exceed the total agreed allocation.
5. Projects
Put Forward but Not Ready to Proceed
Council staff provided
projects for consideration with a total estimated value of $14,506,466.
These have been reviewed for their readiness to proceed as Tranche 1 projects,
robustness of estimates, ability to be completed by 30 June 2024, the ability
to access other government funding for the project, and future savings.
A large amount of the
work requires further planning, investigation, and cost estimating to have
confidence that it can be undertaken for the costs presented, and within two
years.
Investigations to enable
projects to be progressed in Tranche 2 or through the 2024 Long-term Plan have
been included for consideration in Tranche 1.
The following list of
projects were put forward by staff and are recommended for consideration in the
Tranche 2 application process. Staff will be encouraged to provide further
analysis and detail on these, including a review of the cost estimates and
contingency amounts.
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Programme
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Project
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Amount
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Community Facility
Upgrades.
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Alexandra Community Centre.
Earthquake Strengthening & Stage Upgrade.
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$3,215,166
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Clyde Hall Kitchen and Accessible Bathroom.
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Tarras Community Hall.
Earthquake strengthening, Accessibility
upgrades.
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Roxburgh Entertainment Centre.
Maintenance and upgrades
including fire system, earthquake strengthening, LED lighting.
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Water Treatment Plants for Māniatoto
Rural Halls – Waipiata and Wedderburn.
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Māniatoto Park Stadium.
Upgrade Stadium Lights to
LED, Earthquake strengthening work and new ramp, Clubrooms Double Glazing and
Code Locks.
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Ranfurly Service Centre.
Earthquake strengthening,
Double glazing, New door back ramp, Replace Diesel Boiler, Upgrade KVA
Capacity.
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Māniatoto Art Centre.
Encapsulate or remove
asbestos ceiling panels in meeting room.
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Public Toilets.
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Naseby Public Toilets.
New Triple Unisex Block.
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$1,038,800
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Cromwell Bike Park Toilets.
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Molyneux Park New Public Toilets.
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Ranfurly Public Toilets New Public Toilets.
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Eden Hore Central Otago.
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Mobile pop-up visitor experience.
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$750,000
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Omakau Community Hub.
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New kitchen and dining area
for camping and recreational use at the Omakau Recreational Reserve.
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$450,000
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Development of Reserves.
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Half Mile Reserve.
Source of wildling conifers
removed. Site is redeveloped as an open friendly space.
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$1,150,000
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Boothill Reserve.
Source of wildling conifers
removed. Site is redeveloped as an open and friendly space.
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Grovers Hill Redevelopment.
Grovers Hill Forest Park
accessible to the community for a wide range of recreational activities.
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River Track Planting in
Teviot.
The track in many places is
overgrown with weed species. Planting in natives will provide a native
corridor along the river's edge.
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Support to fibre
installation projects.
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Installation of fibre to
Millers Flat or Ettrick community.
The Ettrick and Millers
Flat communities lack fibre connectivity and have been working with Yrless to
deliver a fibre solution. Funding would be used to mee the funding gap
between the total cost and the contribution from Yrless and households and
businesses in one of these communities.
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$925,000
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Alexandra/Clyde –
Cromwell Fibre link.
The current Clyde-Cromwell
fibre link is aging and at capacity. The addition of a new fibre link would
increase resilience to natural events, deliver faster speeds, provide
capacity for future growth, and enable new opportunities for council,
community, and business.
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Secondary school’s
pathways to work – pilot.
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Support a 2-year pilot
programme aimed at raising awareness and connecting youth with local
employers and employment options.
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$100,000
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Purchase and rollout of new
kerbside bins.
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Reducing the size of the
rubbish bins, repurposing of large rubbish bin to organics bin with change of
lid, installation of latches on kerbside recycling bins to reduce litter.
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$750,000
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New Emergency Management
Operations Centre/CODC Archive/Museum Storage Facility Building.
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$1,000,000
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New Central Otago District Council Dog Pound.
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$320,000
|
6. Projects
for Consideration
The following projects have been reviewed and
identified as being able to be delivered by 30 June 2024, will support the
larger Tranche 2 application, and have no other government funding
opportunities.
Community Wellbeing Framework and Dataset - $90,000
Council is required to identify wellbeing metrics
for measuring each programme of work. Department of Internal Affairs and
Crown Infrastructure Partners recommend that Councils community wellbeing
framework and dataset used in its annual reports is used for this.
Central Otago District does not have a wellbeing
framework or indicator dataset that is used for annual reporting. Staff
have recommended that this be developed as a project in Tranche 1. This can
then be used to support projects for funding approval for Tranche 2, and for
the 2024 Long Term Plan.
Iwi/Māori Engagement for Tranche 2 - $90,000
Council is required to demonstrate that it has
consulted with iwi for the Tranche 1 funding application, and how any issues
that have been raised will be addressed. Iwi is required to actively
participate in the development of the Tranche 2 programme of work. The
recently approved partnership agreement will form the basis for this. Iwi will
need to provide greater resources to support council’s Tranche 2
application than was anticipated when setting up the partnership agreement. Additional
funding is proposed in Tranche 1 to support this resource requirement.
Supplementary Funding to Progress 2021 – 24
Long Term Plan Projects - $800,000
There have been significant increases in costs as a
result of Covid-19 impacting on the ability to complete work programmes during
lock-downs and staff absences, inflation, material supply, and resourcing cost
increases. Several projects that were in the 2021 Long Term Plan to be
delivered in 2022/23 and 2023/24 will require additional funding to enable
these to progress. These projects are ready to proceed and can be
completed before Tranche 2 becomes available in July 2024. These are:
· Alexandra Library Upgrade
· Digitisation of property records
Emergency Management and Building Seismic Resilience
Assessments - $650,000
There is currently a mobile generator located in the
Teviot area to provide back-up power for emergency management in this
area. A further three generators could be purchased for the Māniatoto,
Vincent, and Cromwell wards. This would include wiring of emergency
management centres in these areas for generator use. It is proposed that
four Starlink communication systems also be installed at these centres.
Further work to complete seismic assessments of
community facilities and prepare design and tender document is also
proposed. This would provide robust information on which to prepare an
application in Tranche 2 for undertaking this work, or alternatively to feed
into the 2024 Long Term Plan. There are several associated upgrades on
these facilities that could be more effectively undertaken at the same time as
the seismic upgrades on these buildings in Tranche 2. This includes
energy efficiency improvements, accessibility improvements, water supply
upgrades, and replacement of dated fixtures and fittings.
Strategies and Investigation Work
Several strategies and investigation projects were
proposed by staff. These are not currently funded in the Long-term
Plan.
· Housing Needs Assessment - $200,000.
· Feasibility Study into high-speed internet connectivity
- $65,000.
· Destination Management Plan Project Scoping &
Business Case Development - $200,000.
· Molyneux Stadium Renewals Assessment - $50,000.
· Video employers can use to attract people into the
district for work – $20,000.
Libraries
There are two projects put forward for libraries,
these are to install Radio Frequency Identification (RFID) which provides
automated scanning of books and is aligned with the systems used in other
neighbouring councils. This would improve the health and safety of staff,
improve operational efficiency, and free up staff time. The estimated
cost of this is $400,000.
The second project is to install new book shelving
and furniture in the libraries. The estimated cost of this is $560,000.
Recreational Facilities and Public Spaces – up
to $2,100,000
There are a number of projects that could
collectively form a programme of work. The total estimated value for the
projects submitted is $2,100,000. This includes work on swimming pools,
playgrounds, parks, tennis courts and public spaces. Some of this work is
in later years of the 2021 Long Term Plan but could be accelerated.
Council could provide a sum of money which balances
the programme to $3.21 million for this programme of work. Further information
on the individual projects within this programme can be provided and
prioritised by Council between July and November.
Any projects that do not meet the $3.21million
funding line limit, may be able to be funded as contingency projects.
7. Options
Option 1 –
(Recommended)
Agree to sign the
Funding Agreement and approve a programme of work using the priorities
suggested in the table below, to the value of $3.21M, to include in the Funding
Proposal.
|
Programme
of Work
|
Value
|
|
Community
Wellbeing Framework and Dataset
|
$90,000
|
|
Iwi/Māori
Engagement for Tranche 2
|
$90,000
|
|
Supplementary
Funding to Progress 2021 – 24 Long Term Plan Projects
|
$900,000
|
|
Emergency
Management and Building Seismic Resilience Assessments
|
$650,000
|
|
Libraries
RFID
|
$400,000
|
|
Total
|
$2,130,000
($1,080,000
remaining)
|
|
Strategies
|
Up to
$535,000
|
|
Library
bookshelves and furniture
|
$560,000
|
|
Recreational Facilities and
Public Spaces
|
Remaining
amount & contingency projects from
$2,100,000
of projects presented
|
Advantages:
· Council
receives additional funding to spend on projects that benefit the community.
· Projects
that are ready to proceed can be completed by 30 June 2024, prior to Tranche 2
funding becoming available.
· Work
to enable projects to be ready to proceed for Tranche 2 will be completed,
reducing the risk of non-delivery and over expenditure on Tranche 2 projects.
· Less
work will need to be undertaken within the 3 year Tranche 2 period.
· Tranche
1 funding application can be submitted and approved by Department of Internal
Affairs by the 30 September 2022 deadline.
· The
proposed structuring of the Tranche 1 projects into programmes will streamline
reporting requirements.
· Opportunities
to improve project management across the broader organisation and understanding
of reporting requirements for these types of funding allocations.
Disadvantages:
· There
may be work which is of higher importance to the community.
Option 2
Agree to sign the
Funding Agreement and approve a different list of individual projects to the
value of $3.21M, to include in the Funding Proposal.
Advantages:
· Council
receives additional funding to spend on projects that benefit the community.
· Opportunities
to improve project management across the broader organisation and understanding
of reporting requirements for these types of funding allocations.
Disadvantages:
· Projects
may not be completed by 30 June 2024, and will carry into the Tranche 2
delivery period.
· Work
to enable Tranche 2 projects to be shovel ready may not be undertaken.
· More
work may need to be undertaken within the 3 year Tranche 2 period.
· The
Tranche 1 funding application may not be submitted and approved by Department
of Internal Affairs by the 30 September 2022 deadline.
· The
reporting requirements will be onerous, difficult to meet and will have a high
administrative work requirement.
· If
individual specific projects are included in the funding agreement, then there
will be no flexibility in adjusting the work that is undertake if costs
increase, or the ability to deliver changes. An application to change the
scope of the project will be required to be submitted and approved by Department
of Internal Affairs.
Option 3
Do not sign the Funding
Agreement and receive any funding from Tranche 1. Any funding available
to Council would transfer to Tranche 2.
Advantages:
· Less
work to do during the water reform transition period.
Disadvantages:
· Council
receives no additional funding to spend on projects that benefit the community
There may be a change in Government policy before Tranche 2 is implemented, and
the funding could be lost, or have different requirement placed on it.
· Tranche
2 will require a larger amount of money to be spent in a shorter time.
· Increased
risk of not delivering the programme of work within the time required.
· Work
to enable Tranche 2 projects to be shovel ready will not be undertaken,
increasing the risk of non-delivery and cost over-runs.
· Opportunities
to improve project management across the broader organisation and understanding
of reporting requirements for these types of funding allocations will be lost.
8. Compliance
|
Local Government Act 2002 Purpose Provisions
|
This decision enables democratic local decision making and action
by, and on behalf of communities by allowing Council to spend additional
funds on work that directly benefits the community.
AND
This decision promotes the social/cultural/economic/environmental
wellbeing of communities, in the present and for the future by committing to
projects that benefit one or more of the wellbeings.
|
|
Decision consistent with other Council plans and policies? Such as
the District Plan, Economic Development Strategy etc.
|
Yes.
|
|
Considerations as to sustainability, the environment and climate
change impacts
|
Some of the projects listed will have a positive impact on these
as sustainability is one of the key criteria for this funding.
|
|
Risks Analysis
|
There is a risk to Council of not receiving the funding if the
Funding Agreement and Funding Proposal are not signed and accepted by the DIA
prior to 30 September 2022.
|
|
Significance, Consultation and Engagement (internal and external)
|
Engagement with Iwi/Māori is required to access both
Tranches of funding, particularly Tranche 2 of the funding.
|
9. Next
Steps
Funding
Proposal will be prepared.
10. Attachments
Appendix 1 - Better Off Package
Funding Agreement April 2022.pdf ⇩
|
Report
author:
|
Reviewed
and authorised by:
|
|
|
|
|
Chantal
Green
|
Julie
Muir
|
|
Infrastructure
Finance Officer
|
Executive
Manager - Infrastructure Services and Water Reform Lead
|
|
30/06/2022
|
30/06/2022
|
