Uncertainty over construction costs for the Waimea dam and the Government’s three waters reform programme have been highlighted by the auditor in his report on Tasman District Council’s Long Term Plan 2021-31.
Ahead of councillors adopting the plan on Wednesday, auditor John Mackey, of Audit New Zealand, told them he proposed issuing an unmodified opinion saying “we’re satisfied that the Long Term Plan provides a reasonable basis for long-term, integrated decision-making and co-ordination of the council’s resources and accountability of the council to its community”.
That opinion would also say that the information and assumptions underlying the forecast information in the plan were reasonable and “the disclosures required under the prudence regulations are complete”.
However, Mackey drew attention to uncertainty over total cost of the Waimea dam project along with uncertainty over the three waters reform programme – the latter being an issue that applied to all territorial authorities.
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The Long Term Plan had been prepared as if the three waters – drinking water, wastewater and storm water – would continue to be provided by the council. However, with the provision of water services nationally under review by the Government, that could lead to “significant changes”.
For Tasman District Council, there was also uncertainty over the total cost of the Waimea dam “due to risks associated with the project, including any further Covid-19 related costs and the scale of work still required to complete the dam”.
The approach taken by the council to cope with less funding than anticipated expected from Waka Kotahi NZ Transport Agency had “led the way in the country, and we’re comfortable with what is being incorporated into the Long Term Plan,” Mackey said.
Elected members voted 11-3 to adopt the plan. Mark Greening, Dean McNamara and Trindi Walker were the three councillors who voted against its adoption. Councillor Anne Turley voted for the adoption of the plan but – along with Greening, McNamara and Walker – voted against the adoption of some other policies sent out for consultation at the same time including the Revenue and Financing Policy, which covered a revised option for funding for the irrigators’ share of dam cost overruns.
Greening said he did not believe it was prudent to support the plan while McNamara said he did not believe the council was being prudent.
“I don’t think it’s taken into consideration what’s happening in the world and I think that this proposed 10-year plan is going to cost our ratepayers an extraordinary amount of money,” McNamara said.
Walker said she had “huge concerns that our community voice is not reflected in this Long Term Plan”.
“That we’ve gone out to them, and we’ve consulted them, but we’ve gone … with an option [for funding the irrigators’ share of dam cost overruns] that we didn’t consult [on].”
Councillor Chris Hill said she supported the adoption of the plan.
“There’s a whole lot that’s difficult to live with, but what’s the out, what’s the option? Let’s not pretend it’s easy to have a net debt cap lower than what we’re going to end up with, given the overruns.”
A huge amount of work had gone into the plan. It was unlikely there was a councillor “who particularly wants the rates where they are or the debt where it will be”.
However, the dam cost overruns had had been a “huge issue to deal with, and I feel we’ve addressed it as best we can at this time, so I just don’t want the effort and the work that’s gone in to be minimised”.
Mayor Tim King said the plan had been created during what had “probably been an unprecedented time” with Covid-19 and Government reforms including the planned replacement of the Resource Management Act and the three waters reform.
“It’s quite likely that this will be the last Long Term Plan that council produces that involves asset management plans that relate to, I guess what the majority of the community see as our core role, in terms of water, wastewater and storm water.”
Councillors then went on to set the rates for the 2021-22 financial year, which started on Thursday.
The general rate was set at 0.1971 cents of the capital value for every rateable unit while the uniform annual general charge was set at $290 for every rateable unit.
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The fixed district-wide rate for the Waimea dam environment and community benefits is $28.78 per rateable unit. For owners of those properties in the “zone of benefit”, they also face a rate of 0.0033 cents of capital value.
For 2021-22, the council expects to collect $82.7m in rates – GST exclusive – out of a total GST-exclusive income of $169.4m.
The total rates income increase for 2021-22 (after an allowance for growth) is tipped to be 4.39 per cent, which equates to an actual increase in revenue of $4.965 million for the year.