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AGENDA Late Reports Vincent Community Board Meeting Monday, 10 June 2024
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Date: |
Monday, 10 June 2024 |
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Time: |
10.00 am |
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Location: |
Ngā Hau e Whā, William Fraser Building, 1 Dunorling Street, Alexandra
(A link to the live stream will be available on the Central Otago District Council's website.)
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Peter Kelly Chief Executive Officer |
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4 Reports
24.6.9 Continuing Districtisation of Council activities
Doc ID: 1830733
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Report Author: |
Susan Finlay, Chief Financial Officer |
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Reviewed and authorised by: |
Saskia Righarts, Group Manager - Business Support |
1. Purpose of Report
To consider further districtisation of council activities and agree how the Vincent Community Board will provide feedback to the Council on the impacts of further districtisation on the ward.
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That the Vincent Community Board A. Receives the report and accepts the level of significance. B. To consider further districtisation of council activities and how the Vincent Community Board will provide feedback to the Council. C. Agree the Chair or delegate attend the workshop to provide informal feedback from the Vincent Board to Council on 26 June 2024. D. Agree to provide written feedback to Council by 5.00pm Monday 8 July 2024. |
2. Background
In February this year, a change to the level of community board delegations was proposed. In the feedback, Council heard from some community boards that a conversation about districtisation was needed first, and the delegations paper was left to lie on the table until later this year.
Over the past twenty years Council has engaged in consultation to the community to rate certain activities across the district rather than by ward level. This was because it was particularly challenging in our less populated wards to maintain services given the fewer ratepayers in these areas to spread the cost across. In the mid 1990’s roading was changed to a district rate rather than a ward rate, and the beneficial impact from the Maniototo and Teviot Valley wards can be seen in the graph below.
Similarly, in 2015 Council engaged with the community to change the funding of three waters to be at the district level rather than at the ward level. This was implemented in 2016, and the table below demonstrates that again the benefit this had to some areas, with Omakau and the Teviot benefiting the most from this change.
Today only 18% of activities are rated at the ward level, including community facilities, parks, pools and community grants as demonstrated below.
This paper outlines the rationale to further districtising council activities, as well as the impact it would have on Vincent Ward ratepayers. This paper canvasses the information members received in a workshop on the various workstreams on Wednesday 5 June 2024, (attached as appendix 1) as well as initial thoughts from members on the future role of community boards.
3. Discussion
Council is required to have a 30 year infrastructure strategy with the three waters and roading being mandatory inclusions along with a 10 year financial strategy. The financial strategy is required to consider these long term work programme effects on Council’s required revenue and funding streams such as rates, fees and charges including development contributions, debt levels and servicing of the debt, along any cash reserves.
The financial strategy is also required to not only consider affordability and sustainability of current ratepayers but also our future generations of rate payers in its prudent management of the financial strategy. This encompasses financially managing all funding decisions at a district level to Council consider the long-term impacts of rate funding for depreciation to cover our renewals along with repayment and servicing of debt overtime in an affordable and sustainable manner.
Currently Council does not include community facilities, parks and pools infrastructure in the 30 year Infrastructure Strategy which are not districtised assets, yet they are subject to the same increasing costs and issues of servicing, replacement of ageing infrastructure and increasing national standards.
Now that Council has external debt it is important to manage the balance sheet impacts of all assets as a district. Most of Council’s debt is currently for the three waters programme and as it currently stands Council will meet the maximum debt levels in the next few years. Overall, the reserve accounts are forecast to deplete, the most significant being the Cromwell reserves accounts which are funding in part the Cromwell Memorial Hall.
In the future, Council will not have the ability for wards to borrow internally from other wards for their ward asset expenditure. Net Land sales for Cromwell are currently in the 10 year numbers but with the depletion of their reserve accounts Council will need to consider the funding and timing of the costs of developing the land for sale, given our potential debt profile.
It should be noted any decision to further districtise services will not impact level of services in each ward, these would remain the same levels as they are now until there was a decision to alter these. Any adjustment to level of services would need to be consulted with the community through an annual or long-term plan process.
Districtisation will also benefit our community by simplifying rating policy which will lead to greater transparency.
Land Status
During the delegations conversation there were concerns from the Cromwell Community in particular that the rationale behind the proposal was to take land from one ward to fund activities in other wards with less assets. This was not the rationale behind the proposal but it is fruitful to outline what would happen to land if Council further districtised activities.
All land is currently held by Council as a whole, and under the Local Government Act 2002 community boards cannot hold land. In practice, however, this Council has operated as if land is managed at the ward level and they have historically endorsed community board land sale proposals and the proceeds have been allocated to activities within the particular ward.
There would be no changes to the proceeds of any sale of endowment land (of which Cromwell in particular has some that has been re-zoned and is earmarked for future development). Endowment land can only be used for the purposes of the endowment. In the particular case of the Cromwell land it must only be used in the interests of the original Cromwell borough. It cannot be used to build infrastructure outside the original borough boundaries.
Any freehold land could be sold and used to fund any activity across the four wards, as is intended by the Local Government Act 2002. Finally, Council has a significant amount of reserve land which is subject to the provisions of the Reserves Act 1977 and any sale of this land follows the process under this Act.
Reserve Accounts
All wards have reserves accounts, some of these are in surplus and some have negative balances. Cromwell has overall a positive balance over $20m, which will be largely expended in the next couple of years by funding the development of the new hall. This funding is already earmarked and will not be affected by a decision to further districtise activities. Once the money for Cromwell is spent, the wards will have relatively similar reserve levels and under the proposal to further districtise activities these could be amalgamated
Rates Modelling
In the below modelling, parks, pools, community facilities and museum funding has been included. Community grants (bar museum and pool grants) and promotions grants have been excluded. This shows for the Vincent ward ratepayers, there would be an average $38 per year additional cost across the ten years that have been modelled.
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Average impact per rating unit each LTP year |
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Ward |
Status Quo |
Districtisation |
Variance |
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Cromwell |
$889 |
$837 |
-$52 |
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Maniototo |
$947 |
$837 |
-$110 |
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Teviot Valley |
$604 |
$837 |
$233 |
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Vincent |
$799 |
$837 |
$38 |
The below graph demonstrates the average cost for each ward, over the next ten years if Council was to districtise remaining activities, bar community and promotions grants.
Community Board Role
Community boards have an important role in the Central Otago’s democracy. Through the recent consultation process of the Representation Review all four community boards have been retained, with only minor amendments proposed to the number of councillors sitting on each community board.
The role of community boards is set out in section 52 of the Local Government Act 2002 and it is to:
· represent, and act as an advocate for, the interests of its community; and
· consider and report on all matters referred to it by the territorial authority, or any matter of interest or concern to the community board; and
· maintain an overview of services provided by the territorial authority within the community; and
· prepare an annual submission to the territorial authority for expenditure within the community; and
· communicate with community organisations and special interest groups within the community; and
· undertake any other responsibilities that are delegated to it by the territorial authority.
In the live streamed workshop on 5 July 2024, the Board was presented with ideas for a future potential vision for community boards if further districtisation was to occur. The ideas were:
· To develop relationships and communicate with key organisations, special interest groups, community members and businesses
· To update Council on Community Board matters and community issues via the chair updates (on rotation)
· Make submissions to Council on matters relating to the ward, especially though AP and LTP processes
· Monitor the services Council provides in the ward and how these services meet the needs of the community
· To undertake portfolio activities alongside Councillors
· Facilitate meeting locations and timing to encourage public participation
· Members initiate and attend informal sessions to meet with members of the public, with a suggestion that these sessions could be held alongside other community events
· Act as a liaison on key projects/council activities
· Undertake elected member training, to further develop their skills, and progress to take on roles on other committees/panels
· To clarify and promote the role of the community board in the ward and wider communities
· Take interest in Council meetings/workshops and have an understanding of decision making at Council level
· Attend community events, meetings and groups where possible within their ward and district.
Initial feedback from the Board was that these following things were important:
· Community access to decision makers
· Maintaining informal connections
· Community having ownership and a say in what is happening
· The Board needs to be accessible and more visible as a whole.
If the Board has further views on what it sees their role as and how they best represent the Vincent communities’ views, these can be discussed in the meeting or voiced by the Board through the informal and formal feedback processes described below.
Community Board Engagement
The Board’s Chair (or delegate) is invited to a Council workshop on 26 June 2024 to provide initial thoughts from the Board and ask any questions that may arise after the presentation of the paper.
If the Board chooses to formally submit, written feedback is required by 5pm Monday 8 July 2024 to the Governance Manager. This timeline will enable the Board’s feedback to be incorporated into the Council’s decision paper 31 July 2024.
4. Financial Considerations
The impact of further districtising services on Vincent ratepayers has been modelled above. There would be efficiencies created by not having to run four sets of accounts for wards. These efficiencies would streamline accounting functions, enabling the accountants to focus on more effective engagement and management of accounts across the business.
5. Options
Option 1 – (Recommended)
Notes the impact of further districtising services on the Vincent Ward and agrees to provide informal feedback at a Council workshop on 26 June 2024 and formal feedback by 8 July 2024.
Advantages:
· Enables the views of the Vincent Community Board to be heard and considered by Council ahead of the decision paper in July 2024.
Disadvantages:
· Will require some board time to provide formal written feedback.
Option 2
Notes the impact of further districtising services on the Vincent Ward and does not agree to provide informal feedback at a Council workshop on 26 June 2024 and formal feedback by 8 July 2024.
Advantages:
· Additional board time will not be required to input into the 31 July 2024 Council paper.
Disadvantages:
· The views of the Vincent Community Board will not be heard or considered ahead of the decision paper in July 2024.
6. Compliance
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Local Government Act 2002 Purpose Provisions |
This decision enables democratic local decision making and action by, and on behalf of communities by enabling the communities board’s view to be considered ahead of a decision to formally consult with the community.
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Decision consistent with other Council plans and policies? Such as the District Plan, Economic Development Strategy etc. |
This decision is inconsistent with Council’s funding arrangements under the 2021-31Long-term Plan, and if ultimately agreed to will require a change to the funding arrangements in the 2025-34 Long-term Plan. Any changes could not be implemented until 1 July 2025.
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Considerations as to sustainability, the environment and climate change impacts |
There are direct considerations as to sustainability, the environment and climate change impacts.
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Risks Analysis |
There are no risks, bar involvement and the view of community boards and community not being considered, which are mitigated by involving community boards in the process and formally consulting with the community.
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Significance, Consultation and Engagement (internal and external) |
If Council decides to continue with the proposal, the special consultative procedure must be used and formal consultation for 1 month must be held with the community.
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7. Next Steps
Council will hold a workshop with community board chairs (or their delegates) on 26 June 2024. Community Boards are invited to provide a written response to further districtise services should they wish by 8 July 2024, before Council formally decides whether to proceed with the proposal and engage in formal consultation with the community.
If the Council chooses to proceed with the discussion on 31 July 2024, then formal consultation will be held with the community for the month of August 2024. Deliberations and hearings would occur in September 2024, with the Council’s decision on the issue towards the end of September 2024.
If ultimately Council decides to further districtise services, any changes will not take effect until the 2025-34 Long-term Plan has been adopted.
Appendix 1 - Continuing Districtisation - VCB Workshop ⇩
