Agenda of Finance and Performance Committee

FINANCE AND PERFORMANCE COMMITTEE
Membership:	10
Meeting Cycle:	Meets on a six weekly basis, as required or at the requisition of the Chair
Quorum:	Half of the members
Reports to:	Council

HUTT CITY COUNCIL

Finance and Performance Committee

Meeting to be held in the Council Chambers, 2nd Floor, 30 Laings Road, Lower Hutt on

Wednesday 8 May 2019 commencing at 9.30am.

ORDER PAPER

Public Business

1. APOLOGIES

Cr Sutton

2. PUBLIC COMMENT

Generally up to 30 minutes is set aside for public comment (three minutes per speaker on items appearing on the agenda). Speakers may be asked questions on the matters they raise.

3. CONFLICT OF INTEREST DECLARATIONS

4. Jackson Street Programme - Extension of Area Subject to Targeted Rate (19/533)

Report No. FPC2019/2/86 by the Divisional Manager, Strategy and Planning 8

Chair’s Recommendation:

“That the recommendations contained within the report be endorsed.”

5. Financial Report for the Quarter Ended 31 March 2019 (19/412)

Report No. FPC2019/2/80 by the Acting Chief Financial Officer 19

Chair’s Recommendation:

“That the recommendation contained within the report be endorsed.”

6. Review of Draft 2019/20 Statement of Intent for the New Zealand Local Government Funding Agency (19/134)

Report No. FPC2019/2/81 by the General Manager Corporate Services 70

Chair’s Recommendation:

“That the recommendations contained within the report be endorsed.”

7. New Zealand Local Government Funding Agency Six Month Report to 31 December 2018 (19/135)

Report No. FPC2019/2/82 by the General Manager Corporate Services 93

Chair’s Recommendation:

“That the recommendation contained within the report be endorsed.”

8. Information on Potential New Performance Measures for Urban Plus Ltd (19/518)

Report No. FPC2019/2/83 by the Manager, Sustainability and Resilience 136

Chair’s Recommendation:

“That the recommendations contained within the report be endorsed.”

9. Information Items

a) Tax Risk Governance Framework Update (19/492)

Report No. FPC2019/2/51 by the Financial Accounting Manager 145

Chair’s Recommendation:

“That the information be received.”

b) TechnologyOne SaaS Project Update (19/415)

Report No. FPC2019/2/52 by the Business Transformation Manager 163

Chair’s Recommendation:

“That the information be received.”

c) Finance & Performance Committee Work Programme 2019 (19/414)

Report No. FPC2019/2/53 by the Committee Advisor 166

Chair’s Recommendation:

“That the information be received.”

10. QUESTIONS

With reference to section 32 of Standing Orders, before putting a question a member shall endeavour to obtain the information. Questions shall be concise and in writing and handed to the Chair prior to the commencement of the meeting.

11. EXCLUSION OF THE PUBLIC

CHAIR'S RECOMMENDATION:

“That the public be excluded from the following parts of the proceedings of this meeting, namely:

12. Strategic Property Portfolio - Six Monthly Update (19/484)

The general subject of each matter to be considered while the public is excluded, the reason for passing this resolution in relation to each matter, and the specific grounds under section 48(1) of the Local Government Official Information and Meetings Act 1987 for the passing of this resolution are as follows:

(A)	(B)	(C)

General subject of the matter to be considered.	Reason for passing this resolution in relation to each matter.	Ground under section 48(1) for the passing of this resolution.


Strategic Property Portfolio - Six Monthly Update.	The withholding of the information is necessary to enable the local authority to carry out, without prejudice or disadvantage, commercial activities (s7(2)(h)).	That the public conduct of the relevant part of the proceedings of the meeting would be likely to result in the disclosure of information for which good reason for withholding exist.

This resolution is made in reliance on section 48(1) of the Local Government Official Information and Meetings Act 1987 and the particular interest or interests protected by section 6 or 7 of that Act which would be prejudiced by the holding of the whole or the relevant part of the proceedings of the meeting in public are as specified in Column (B) above.”

Donna Male

COMMITTEE ADVISOR

8 08 May 2019

Finance and Performance Committee

30 April 2019

File: (19/533)

Report no: FPC2019/2/86

Jackson Street Programme - Extension of Area Subject to Targeted Rate

Purpose of Report

1. This report recommends that the Committee agree to use the Special Consultative Procedure (SCP) to consult those affected by a proposed extension of the area covered by the Jackson Street Programme (JSP) targeted rate. The current area covers Jackson Street only - the extended area will be bounded by Cuba Street, Old Hutt Road, Jackson Street and The Esplanade and will apply to all commercial building owners (excludes residential buildings) business owners, managers and business people.

2. Under section 78 of the Local Government Act, Councils must seek community views in the course of its decision-making processes and give consideration to the views and preferences of persons likely to be affected by, or to have an interest in, a matter. In this case, the views of those likely to be affected by or have an interest in an extension of the area covered by the JSP targeted rate.

Recommendations

That the Committee:

(i) notes a survey of all commercial building owners in the proposed extended area covered by the Jackson Street Programme (JSP) is currently underway and that the results of that survey will be available to Council prior to it making its final decision in June 2019;

(ii) notes that the survey covers the following such things as:

(a) awareness of JSP and the work they do;

(b) the added value of JSP programmes to their business;

(d) concerns/disadvantages and advantages/benefits of the proposed change; and

(e) whether they agree with the suggested extension of the targeted rate;

(iii) notes that based on the new footprint, to collect $230,000 (which includes GST) equates to 0.000415411 cents in the dollar;

(iv) notes that 0.000415411 cents in the dollar means that a property worth $100,000 pays $41.54, one worth $1m pays $415.41 and a property worth $10m pays $4,154.11;

(v) notes section 16 (g) of the Local Government (Rating) Act 2002 allows a targeted rate to be set if the activity/activities is identified in the Funding Impact Statement;

(vi) notes that the Funding Impact Statement will need to be amended to allow the targeted rate to be extended so that the new rate can be applied; and

(vii) agrees to consult on the Summary of Information and Statement of Proposal (drafts of which are set out respectively in Appendix 1 and 2 of this report subject to legal confirmation and any changes requested by the Committee) in accordance with the requirements of the Local Government Act 2002 by means of a Special Consultative Procedure.

For the reason that as a consequence of the request from JSP that the area covered by the targeted rate is extended to the area bounded by Cuba Street, Old Hutt Road, Jackson Street and The Esplanade the Local Government Act 2002 requires Council to undertake a Special Consultative Procedure.

Background

3. In 1991, residents and members of the business community in Petone formed an incorporated society known as the Jackson Street Programme Incorporated (JSP), specifically to implement a plan to economically revitalise and promote Jackson Street and through this “uplift and enhance”^{^[1]} the business area generally. The area covered all 220 businesses along Jackson Street – from the Railway Station to Cuba Street in 1991. There are now 151 businesses paying the targeted rate.

4. Over the years since then Council has supported and encouraged JSP in its endeavours and has been committed to help finance JSP’s activities by way of a special rate. Originally the special rate was established to raise $60,000 per annum to be used by JSP to achieve its objectives. The terms and conditions under which the fund was raised and used were set out in a legal agreement between Council and the JSP that commenced on 1 July 1992.

5. The JSP has been in place since that time. It promotes Jackson Street as a destination for shopping, eating out, professional services, commercial services and socialising. It also organises promotional and community events. JSP activities are run by three part time staff from an office in the Historic Police Station. The JSP Board is elected at an Annual General Meeting held each spring. ^{^[2]} The Board is made up of business owners, managers and business people with the governance skills required for Boards in New Zealand.

6. Funds also come from charitable donations and subscriptions paid by supporters and associate members. Businesses not in Jackson Street can become Associate Members and can become a Board member. JSP prepares an annual budget and business plan to generally describe how it will use the funds and reports to Council on progress on a 12 monthly basis.

7. JSP has asked Council to consider supporting its request to extend the area covered by the extended targeted rate and to consult those likely to be affected.

8. A survey has been sent to all commercial building and business owners to assess the level of support for the extension of the area covered by the JSP targeted rate - that is the area bounded by Cuba Street, Old Hutt Road, Jackson Street and The Esplanade.

9. Interim results show that 66% of those not currently covered by JSP programme and not currently owning a building in the JSP area support the proposal. Support from current JSP rate payers is 90%. Full survey results will be tabled at the meeting.

Discussion

10. JSP offers the following services to business owners, managers and business people:

a. monthly newsletter updates providing news on what is happening;

b. updates about safety and security issues, government or Council matters that could affect business or buildings;

c. work with Petone Library, Settlers Museum, Community House, Lions, Sports Clubs, Workingmen’s Club, Historical Society and local schools ;

d. enhance existing businesses, attracting customers through the JSP web site and free touring Petone app. The web site provides business details, links to business face Book/Web Sites, provides pictures and videos and secondary business information; and

e. keeping track of people making business inquiries – for example, 13,512 people made more than 53,766 inquiries to businesses on www.JacksonStreet.co.nz over the six months to 30 June 2018.

11. Currently JSP receives $156,000 (which includes GST) via the targeted rate. This amount is adjusted annually by CPI. The extended area will enable the targeted rate to raise a further $74,000 with the rate set to collect a total of $230,000. The current rate is 0.0008032 cents in the dollar.

12. Based on the new footprint, to collect $230,000 (which includes GST) equates to 0.000415411 cents in the dollar. So a property worth $100,000 pays $41.54, one worth $1M pays $415.41 and a property worth $10M pays $4,154.11.

13. This means that current JSP ratepayers will pay just under 50% less than they do at present.

14. Currently JSP is performing at the maximum level it can with the funding available to it. Increased funding will bring greater benefits for all businesses in the targeted rate area from the increased ability of JSP to run events, seminars, work with Council to attract larger numbers of visitors to Petone and ultimately to wider Lower Hutt. For example JSP will be able to expand the work they are currently doing with Council’s Events and Promotions team, the Great Harbour Way promotion and the provision of information about other attractions in the wider Hutt Valley.

Options

15. The Committee has the option of supporting JSP’s request to consult on the extension of the area covered by the targeted rate and the rate to collect a total of $230,000 OR not support the request.

Consultation

16. A survey of all business owners, managers and business people in the existing and proposed extended area to be covered by the Jackson Street Programme (JSP) is currently underway and that the results of that survey will be available to Council prior to it making its final decision in June 2019.

17. A SCP must be used to establish the proposed extended area subject to the JSP targeted rate as this will result in a change to Council’s Funding Impact Statement.

Legal Considerations

18. Section 16 (1) of the Local Government (Rating) Act 2002 allows a targeted rate to be set if the activity/activities is identified in the Funding Impact Statement (FIS).

19. Currently the FIS reads:

Jackson Street Programme Rate

A separate targeted rate, based on the capital value of each rating unit, will be set to raise revenue from Jackson Street Petone, between Hutt Road and Cuba Street. The revenue raised from this rate will be applied to a community-based initiative to help recognise and revitalise commercial activities in Jackson Street. The charge for the 2018-2019 rating year is as follows:

CATEGORY RATE

Rating units in any business category having 0.0008032 cents per $

frontage to Jackson Street, between Hutt Road of Capital Value

and Cuba St

20. Both the statement of activity and the rating information will need to be amended to the following:

Jackson Street Programme Rate

A separate targeted rate, based on the capital value of each rating unit, will be set to raise revenue from the area in Petone bounded by Hutt Road, Cuba Street, Jackson Street and the Esplanade. The revenue raised from this rate will be applied to a community-based initiative to help recognise and revitalise commercial activities in Jackson Street. The charge for the 2019-2020 financial year as follows:

CATEGORY RATE

Rating units in any business category having 0.000415411 cents per

frontage to Jackson Street, between Hutt Road $ of Capital Value

and Cuba St

21. Section 87 of the LGA enables local authorities to use the Special Consultative Procedure (SCP) when neither Section 86 or 93A apply but a local authority is required to use or adopt the SCP or if a local authority chooses to use a SCP. As JSP’s request requires Council to amend an existing targeted rate and this will require an amendment to the FIS, it is prudent for Council to use the SCP to ensure that all interested parties and those people who will be directly impacted by the extension of the area subject to the JSP rate targeted get an opportunity to make their views known to Council.

22. Under section 23 of the Rating Act 2002 rates must be set by resolution of the local authority.

Financial Considerations

23. The JSP has existed since 1991 and has over the years made a number of improvements to the services it offers to business owners, managers and business people. The JSP requires increased funding if it is to continue to improve and expand the services offered, leverage off existing successes and bring greater benefits for all businesses in the targeted rate area.

Other Considerations

24. In making this recommendation, officers have given careful consideration to the purpose of local government in section 10 of the Local Government Act 2002. Officers believe that this recommendation falls within the purpose of local government in that it is enables Council to continue to support the JSP promote Petone to the wider region, nationally and internationally. Petone is a “gate-way” to Lower Hutt with Jackson Street having become a key attraction local, regionally, nationally and internationally.

Appendices

No.	Title	Page
1 ⇩	STATEMENT OF PROPOSAL TO EXTEND THE AREA OF THE JACKSON STREET PROGRAMME TARGETED RATE	13
2 ⇩	Short Summary of proposal – Extension of area subject to JSP Targeted rate	18

Author: Wendy Moore

Divisional Manager, Strategy and Planning

Approved By: Helen Oram

Acting General Manager City Transformation

Attachment 1

STATEMENT OF PROPOSAL TO EXTEND THE AREA OF THE JACKSON STREET PROGRAMME TARGETED RATE

STATEMENT OF PROPOSAL TO extend the area of the jackson street programme targeted rate

may 2019

Contents

Introduction ................................................................................................................................

Background

Jackson Street programme.

Implications for ratepayers.

Process required to extend the area subject to the Jackson Street Programme targeted rate

NEXT STEPS.

Introduction

Council received a request from Jackson Street Programme (JSP) that the area covered by the targeted rate is extended to the area bounded by Cuba Street, Old Hutt Road, Jackson Street and The Esplanade. The Local Government Act 2002 requires Council to undertake a Special Consultative Procedure in order to make an amended or new targeted rate.

This statement of proposal has been prepared in accordance with section 83 of the Local Government Act 2002 (“LGA”). It includes information about the request from JSP, the reasons for the request and the impact on those likely to be affected by or interested in whether Council agrees to and implements a revised targeted rate and strike the rate accordingly.

Background – history of JSP targeted rate

In 1991, residents and members of the business community in Petone formed an incorporated society known as the Jackson Street Programme Incorporated (JSP), specifically to implement a plan to economically revitalise and promote Jackson Street and through this “uplift and enhance”^{^[3]} the business area generally. The area covered all 220 businesses along Jackson Street – from railway Station to Cuba Street.

Over the years since then Council has supported and encouraged JSP in its endeavours and has been committed to help finance JUPS’s activities by way of a special rate. Originally the special rate was established to raise $60,000 per annum to be used by JSP to achieve its objectives. The terms and conditions under which the fund was raised and used were set out in a legal agreement between Council and the JSP that commenced on 1 July 1992.

The JSP has been in place since that time. It promotes Jackson Street as a destination for shopping, eating out, professional services, commercial services and socialising. It also organises promotional and community events. Three part time staff run the JSP activities from an office in the Historic Police Station. The JSP Board is elected at an AGM held each spring. ^{^[4]} The Board is made up of business owners, managers and business people with the governance skills required for Boards in New Zealand.

Funds also come from charitable donations and subscriptions paid by supporters and associate members. Businesses not in Jackson Street can become Associate Members and can become a Board member. JSP prepares an annual budget to generally describe how it will use the funds and reports to Council on progress on a 12 monthly basis.

JSP has asked Council to consider supporting its request to extend the area covered by the extended targeted rate and to consult those likely to be affected.

A survey has been sent to all commercial building and business owners to assess the level of support for the extension of the area covered by the JSP targeted rate - that is the area bounded by Cuba Street, Old Hutt Road, Jackson Street and The Esplanade.

Jackson Street programme

JSP offers the following services to business owners, managers and business people:

a. monthly newsletter updates providing news on what is happening;

b. updates about safety and security issues, government or Council matters that could affect business or buildings;

c. work with Petone Library, Settlers Museum, Community House, Lions, Sports Clubs, Workingmen’s Club, Historical Society and local schools ;

e. keeping track of people making business inquiries – for example, 13,512 people made more than 53,766 inquiries to businesses on www.JacksonStreet.co.nz over the six months to 30 June 2018

Why extend the targeted rate area?

Currently JSP is performing at the maximum level it can with the funding available to it. Increased funding will bring greater benefits for all businesses in the targeted rate area from the increased ability of JSP to run events, seminars, work with Council to attract larger numbers of visitors to Petone and ultimately to wider Lower Hutt. For example JSP will be able to expand the work they are currently doing with Council’s Events and Promotions team, the Great Harbour Way promotion and the provision of information about other attractions in the wider Hutt Valley.

Implications for ratepayers

For existing JSP rate payers there will be some reduction to the amount paid as more people will be paying the rate. Those currently not paying, but possibly benefitting from JSP’s work will begin to pay. Currently it is likely that benefits to business owners are not evenly spread between those paying and those not paying. There will be increased benefit for all from increased ability of JSP to run events, seminars, work with Council to attract larger numbers of visitors to Petone and ultimately wider Lower Hutt. For example, work with Events and Promotions team, Great Harbour Way, JSP provides information about other attractions in wider Hutt Valley.

Currently JSP receives $156,000 (which includes GST) via the targeted rate. The extended area will enable the targeted rate to raise further $74,000 with the rate struck to collect a total of $230,000.

Based on the new footprint, to collect $230,000 (which includes GST) equates to.000415411cents in the dollar. So a property worth $100,000 pays $41.54, one worth $1m pays $415.41 and a property worth $10m pays $4,154.11.

Process required to extend the area subject to the Jackson Street Programme targeted rate

Hutt City Council must:

· Consult those people likely to be affected by a decision to extend the area subject to the JSP targeted rate. It is doing that through the Special Consultative Procedure;

· Strike the rate at the same time as it sets all other rates prior to 30 June 2019

· Amend its Financial Impact Statement to reflect the changes made to the targeted rate for the Jackson Street Programme.

NEXT STEPS

The special consultative procedure will end at 5:00pm on Tuesday 4 June 2019. People may speak at the Community Plan Committee meeting on 5 June 2019.

An analysis of survey results will also be presented to the Community Plan Committee for consideration. The proposed extended area subject to the JSP targeted rate will then be referred to the Council for consideration and establishment of the rate.

35 08 May 2019

Finance and Performance Committee

02 April 2019

File: (19/412)

Report no: FPC2019/2/80

Financial Report for the Quarter Ended 31 March 2019

Purpose of Report

1. The report sets out Council’s financial performance and position for the quarter ended 31 March 2019, with explanations of key results and variances.

Recommendation

That the Committee notes Council’s financial performance and position for the nine month period ended 31 March 2019.

Background

2. The Committee is provided with information on five broad areas of financial performance:

Part A: Statement of Comprehensive Revenue and Expenses

Part B: Statement of Financial Position

Part C: Statement of Cash Flows

Part D: Capital Expenditure Programme and Asset Sales

Part E: Treasury Management

3. In addition, Activity Statements and Project Lists are attached as an Appendix to this report.

Financial Information

4. The information contained in this report excludes all of Council’s Council Controlled Organisations (CCOs). Best endeavours have been made by all Council officers to ensure the accuracy and completeness of the financial information contained within this report.

5. There is still three months of the 2018/19 financial year remaining and Council’s financial performance and position is subject to change in light of any new information.

6. Note: for the variances columns in all the tables in this report, a positive reflects a favourable impact and a negative (in brackets and red) reflects an unfavourable impact. For carryovers, in terms of the impact on next year, revenue carried over is positive and expenditure carried over is negative.

7. At a recent workshop Councillors were advised of issues with the Naenae Pool which has resulted in its closure. At this stage the financial implications of closing the pool, both in regard to the impact on operating revenue and expenditure and future capital investment, have not been fully assessed and are therefore not covered in this report.

Part A: Statement of Comprehensive Revenue and Expenses

8. The Statement of Comprehensive Revenue and Expenses below covers all of Council’s revenue and operating expenditure and provides the operating surplus or deficit for the nine month period to 31 March 2019 and the expected full year forecast compared to budget. The layout below is similar to how this information is presented in the 2018/2028 Long Term Plan.

9. Below is a revised Statement of Comprehensive Revenue and Expenses that separates the budgets and costs related to (a) grants paid to the Hutt City Community Facilities Trust (CFT) and (b) the Development Stimulus Package. As previously explained, CFT grants are capital in nature as they are to fund new assets developed by the CFT on behalf of Council. Development Stimulus Package costs are not considered normal operating costs, ie, they are temporary expenses of an investment nature to stimulate capital growth in the City, and are being offset by an underspend in the Urban Growth Strategy capital project.

Financial Performance Summary

Year to Date

10. Excluding Gains/(Losses) on Revaluations of Financial Instruments and Property Revaluations/Sales/Disposals, Council’s financial performance to 31 March 2019 was $2.1M unfavourable to budget. This was mainly due to reduced capital subsidies from delays in the capital programme, an unbudgeted operating grant payment to the CFT, additional funding for Fraser Park Sportsville, and increased Development Stimulus costs. These have all been reported previously. These are offset by a significant increase in vested assets mainly coming from property developments within the City.

11. To date Council has an unrealised loss of $8.1M on its financial derivatives which is due to derivative interest rates falling further since 30 June 2018. There is no intention to realise these fair value changes (whether gains or losses). This is recognised for accounting purposes only and does not represent a cash loss. To date Council also has realised gains of $3.0M on assets sales/disposals.

12. Including all of the Gains/(Losses), Council’s financial performance to 31 March 2019 was $7.2M unfavourable to budget.

Full Year Forecast

13. Excluding Gains/(Losses) on Revaluations of Financial Instruments and Property Revaluations/Sales/Disposals, Council is currently forecast to be $5.3M unfavourable to budget at year end.

14. Operating revenue is forecast to be favourable to budget by $1.7M mainly due to the following:

· $0.8M increase in user charge mainly from higher consent fees and landfill revenue but these are offset by reduced user charges across a number of activities;

· $1.0m from Development Contributions;

· $1.4M from vested assets (these are non-cash); and

· these are offset by $1.7M of capital subsidies, budgeted but not yet received until the associated capital works are completed.

15. Operating expenditure is forecast to be unfavourable by $7.0M mainly due to the following:

· $3.2M overspend on the Development Stimulus Package (although this expenditure is partially offset by a $2.9M reduction in the Urban Growth Strategy capital budget and associated user charges and development contributions);

· $4.1M overspend in other operating costs including: $1.1M in landfill costs, $1.0M related to Making Places (RiverLink), $0.5M in Bulk Water costs, $0.5M in insurance costs, $0.4M in events costs, and $0.4M Events Centre Underwrite;

· $1.0M in additional depreciation costs; and

· employee costs expected to be $0.4M favourable and Interest charges $1.0M favourable, due to lower than planned borrowing (debt) and continued low interest rates.

Explanation of Key Revenue Variances

16. Rates

Brief Description	Rates include all rates earned by Council. Rates refunds, rates remissions and rates billed to Council owned properties are excluded.
Year to date variance:	Close to budget but trending unfavourable.
Full Year Forecast Variance:	$0.2M unfavourable to budget as actual growth in the rating information database when rates were set on 28 June 2018 was lower than planned (0.92% vs. 1%) although actual growth as at 30 June 2018 was 1.04%. Remissions are also likely to be higher than budgeted.

17. User Charges

Brief Description	All non-rates revenue (including metered water charges), for providing services to the community. This also includes fines and penalties charged.
Year to date Variance:	Close to budget.
Full Year Forecast Variance:	$0.8M favourable variance mainly due to expected additional Landfill revenue of $1.5M, consents revenue of $0.5M related to the Development Stimulus Package and $0.5M from additional building consents and $0.25M from the build of 1,000 pre-fab homes. The overall favourable variance is reduced by unfavourable forecasts for the Fitness Suites and Learn to Swim of $0.5M, and $0.3M in Reserve Contributions, and $0.5M in Parking Revenue.

18. Operating Subsidies (Including Upper Hutt City Council (UHCC)) and Grants

Brief Description	Includes mainly subsidies received from the New Zealand Transport Agency (NZTA) for its share of Council’s Roading operating maintenance costs and UHCC’s share of wastewater costs.
Year to date Variance:	Close to budget.
Full Year Forecast Variance:	The full year forecast is favourable by $0.2M mainly due to a new footpath maintenance subsidy from NZTA that was agreed after budgets were set.

19. Capital Subsidies

Brief Description	Includes subsidies received for capital works. The majority of subsidies are received from the New Zealand Transport Agency (NZTA) for their share of Council’s spend on Roading projects, plus the spend on the Cycleways/Shared Paths projects.
Year to date Variance:	$1.4M unfavourable to budget is mainly due to project delays, particularly on the Cycleways/Shared Paths projects. This is timing related with a corresponding underspend to date in capital. This reduced subsidy has however been partially offset by additional unbudgeted subsidy revenue from footpath renewals.
Full Year Forecast Variance:	$1.7M unfavourable to budget is mainly due to delays in the Eastern Bays Cycleway. This is timing related and there is a corresponding under spend in capital which will be carried over to next financial year. The difference between the forecast and the carryovers is due to the receipt of additional unbudgeted subsidies for some projects especially footpaths renewals.

20. Development Contributions

Brief Description	Development Contribution fees go towards the capital costs of providing growth-related infrastructure such as Roading, Water Supply, Wastewater and Stormwater assets required to serve new developments.
Year to date Variance:	$0.4M unfavourable due to the timing of income compared to budget (the later has been spread evenly across the year).
Full Year Forecast Variance:	Favourable forecast of $1.0M due to expected contributions related to applications received from the Development Stimulus Package.

21. Interest Earned

Brief Description	This is revenue received from financial investments.
Year to date Variance:	$0.3M favourable to budget mainly due to more cash held on deposit in first half of year.
Full Year Forecast Variance:	$0.3M slightly favourable to budget mainly due to more cash held on deposit especially in first half of year.

22. Vested Assets

Brief Description	This relates to assets created by external parties that are vested to Council. These are non-cash. Council has no control on the timing or value of assets vested to Council.
Year to date Variance:	$1.6M favourable to budget mainly due to more developments completed to date than expected.
Full Year Forecast Variance:	$1.4M favourable to budget mainly due to more developments than expected as a result of Developments Incentives. These are non-cash so have no impact on debt.

23. Other Revenue

Brief Description	This includes petrol tax, sale of goods, animal shelter fees and central government subsidies for Ministry of Health initiatives, Kiwi Sport and Waste Minimisation levies.
Year to date Variance:	$0.1M unfavourable to budget mainly due to an expected commercial contract to dispose waste at the landfill not eventuating. However, regular landfill fees (within user charges) are currently $1.2M favourable to budget.
Full Year Forecast Variance:	$0.1M unfavourable to budget mainly due to the expected one-off commercial contract to dispose waste not eventuating. Regular landfill fees (within user charges), however are expected to be $1.5M favourable to budget.

Explanation of Key Expenditure Variances

24. Employee Costs

Brief Description	Includes total costs of salary and wages for all employees and fixed term contractors, including PAYE, Kiwi Saver contributions, annual leave entitlements, allowances, and staff training and development.
Year to date Variance:	$0.6M favourable to budget mainly due to Council-wide staff vacancies and timing variances of training programmes.
Full Year Forecast Variance:	$0.4M favourable to budget mainly due to staff vacancies in the first half of the year, particularly in the Environmental Consents team.

25. Operating Costs

Brief Description

Includes direct operating costs, excluding internal rates, employee costs, grants paid to the CFT, development stimulus payments, finance charges, support costs and depreciation.

Year to date Variance:

$0.1M favourable to budget mainly due to project delays and temporary timing differences between planned and actual spend across a number of activities.

Full Year Forecast Variance:

$4.1M unfavourable to budget mainly due to:

· $1.0M relates to operating costs associated with the Making Places (including RiverLink) project. This includes a $0.7M prior period adjustment from last financial year with the transfer of capital costs that should have been treated as operating. There is an offsetting equivalent credit in capital (work in progress). In both operating and capital the total cost this year will be about $0.5m under budget which will need to be carried over;

· $1.1M in higher landfill costs including $0.4M for purchases of Emission Trading Units which have recently significantly increased in price. This unfavourable variance is more than offset by higher user charges;

· $0.5M in additional Bulk Water Levy costs are forecast;

· $0.4M in increased insurance premiums;

· $0.4M related to Council run events including Highlight due to additional one-off setup costs related to the scale of the event. Adjustments have been made to other planned events to reduce the impact of the over spend;

· $0.4M underwrite of the Events Centre;

· $0.5M related to increased specialist services costs to assist with the processing of resource consent applications due to vacant staff positions. This will be offset by additional revenue.

26. Hutt City Community Facilities Trust (CFT) Operating Grants

Brief Description

CFT is a Council Controlled Organisation that constructs (and manages) community facilities for and on behalf of Council. Payments made by Council to CFT for CFT capital projects are required to be treated by Council as operating expenditure for accounting purposes. [If these capital works were done directly by Council, they would be treated as capital expenditure and Council would achieve a balanced budget for 2018/19].

Year to date Variance:

$1.5M unfavourable variance to budget is mainly due to additional funding for Fraser Park Sportsville.

Full Year Forecast Variance:

The slight $0.05M favourable variance is due to the favourable variance and planned carryover of $2.5M for Wainuiomata Sportsville which offsets the additional funding for Fraser Park Sportsville and an operating grant payment to the CFT.

In February 2018, Council agreed to advance to the CFT $0.75M for Fraser Park Sportsville, to be repaid to Council over a 15 year period, in return for the transfer from CFT to Council of the building naming rights. This was incorrectly treated as a loan in the 2018/19 Long Term/Annual Plan.

27. Development Stimulus Package

Brief Description	The Development Stimulus Package also referred to as the Development Charges and Rates Remissions Policy, was set up to encourage development in the city. This policy was suspended at 31 December 2018.
Year to date Variance:	$1.0M unfavourable to budget due to the high volume of applications received.
Full Year Forecast Variance:	$3.2M unfavourable to budget due to the high volume of applications received at 31 December 2018. This expected spend is offset by a reduction of $2.9M in the Urban Growth Strategy capital budget (for growth infrastructure) and an increase in revenue for consents and development contributions.

28. Interest Expense

Brief Description	This is the interest cost for borrowing to fund Council’s capital projects not covered by depreciation and any operating deficits.
Year to date Variance:	$0.7M favourable variance to budget.
Full Year Forecast Variance:	$1.0M favourable variance to budget mainly due to a lower weighted average cost of borrowing (interest rates), compared to budget.

29. Depreciation

Brief Description	Includes Depreciation for Councils Infrastructural and Operational assets.
Year to date Variance:	$0.5M unfavourable to budget.
Full Year Forecast Variance:	$1.0M unfavourable to budget mainly due to higher than budgeted depreciation for Road and Footpath construction ($0.5M), Event Centre ($0.3M) and Reserves ($0.1M).

30. Gains/Losses on Revaluation of Financial Instruments

Brief Description

1. Council recognises its interest rate swaps at fair value each month.

2. The change in fair value between reporting date and 30 June 2018 is treated either as an unrealised gain (fair value has decreased) or an unrealised loss (fair value has increased).

Year to date Variance:

$8.1M unfavourable to budget because swap rates are lower when compared to 30 June 2018.

Full Year Variance:

Given the volatility of the financial markets, the full year forecast will always be aligned to the year-to-date fair value of Council’s committed swap portfolio.

31. Gains/Losses on Revaluation of Assets

Brief Description	Council revalues its property, plant and equipment every three years with the most recent revaluation completed on 31 December 2017. In addition, Council recognises either gains/losses on sale/disposal of its assets.
Year to date Variance:	$3.0M favourable due to realised gains made on recent asset sales/disposals that were expected to have settled in 2017/18 but slipped into early 2018/19.
Full Year Variance:	$3.0M favourable to budget as per above.

Part B: Statement of Financial Position

32. Council’s financial position as at 31 March 2019 and the full-year forecast against budget are shown below, followed by a summary of key variances.

Overall Summary

33. Council’s financial position as at 31 March 2019 is sound with net assets of $1.3 billion.

34. Debtors and receivables of $55.6M includes $48.1M (including GST) of the combined rates of Council and Greater Wellington Regional Council for the remaining two instalments of 2018/19 (not yet due), plus rates in arrears. However, this is offset by the:

· “Other liabilities” which includes $30.0M of Council rates revenue in advance; and

· “Creditors and other payables” which includes $10.3M of Greater Wellington Regional Council share of rates.

35. $14M of debt matured 15 March 2019. This was prefunded with the same amount held on term deposit until the maturity date of 15 March 2019.

36. Investment in CCOs represents $14.5M of shares in Council’s CCOs, $14.7M in loans to CCOs and $2.8M of Local Government Funding Agency (LGFA) borrower notes.

Net Debt

37. Year to date Net Debt is below budget mainly due to project delays. Forecast debt is expected to also be below budget. The expected forecast overspend in operating costs is more than offset by the forecast underspends in capital. The favourable variance in asset sales will have no effect on the debt as the budget assumed these would have been completed last year.

Part C: Statement of Cash Flows

38. Council’s cash flow for first quarter ended 31 March 2019 and the full year forecast against budget are shown below, followed by a summary of key variances.

Overall Summary

39. Council’s cash on hand as at 31 March 2019 was $7.0M.

40. The main activities for the nine months to 31 March 2019 included:

· rolling over $10M of existing Council debt maturing in 20 September 2018;

· rolling over $14M of existing debt borrowed on behalf of our CCO’s 15 March 2019; and

· financing short term needs with commercial paper in $5M tranches.

Part D: Capital Expenditure Programme and Asset Sales

Capital Expenditure

41. A summary of the 2018/19 capital works programme for the nine months to 31 March 2019 is shown below.

42. Total budgeted capital expenditure for the year is $72.6M. At this stage we are forecasting to be underspent at year end by $14.1M mainly due to expected delays in the Cycleways/Shared Paths projects and underspends on the Urban Growth Strategy and the Naenae Hub projects, offset by forecast overspends in a number of key projects as shown below.

43. The following are comments on the above forecast variances. The variances for a number of projects (as noted in brackets) are due to the timing of work between years rather than a variance in the project’s total costs compared to the total budgets.

· Wharves Refurbishment ($0.74M unfavourable, timing related) – the Rona Bay wharf was completed ($0.1M) over budget and the Days Bay wharf refurbishment has been brought forward to this year with a corresponding underspend next year.

· Avalon Park Development ($0.77M unfavourable, timing related) – the over spend this year is offset by an under spend last year when some of the work on the project last year was not able to be completed.

· Making Places Civic Event Centre Upgrade ($0.59M unfavourable, timing related) - project delays last year (mainly suppliers and labour shortage) have resulted in pushing work on the project into this year.

· Making Places Projects – the budgeted capital component of this project will not be spent as costs at this stage are being treated as operating. The operating component that relates to RiverLink is forecast to be unfavourable by $1.0M mainly due to a $0.7M prior period adjustment from last financial year due to a transfer of capital costs that should be treated as operating.

· Urban Growth Strategy Improvements ($2.9M favourable) – this is to offset agreed additional operating costs with the Development Stimulus Package.

· Cycleways /Shared Path Projects ($3.4M favourable) – overspend on the Wainuiomata Shared Path and Beltway projects of $0.2M due to complexities of the work on Wainuiomata Hill. Delays in the Eastern Bays Cycleway project requiring $3.6M to be carried over to 2019/20.

44. A number of carryovers to 2019/20 have already been identified at this stage. These are shown within the Activity Statement tables. These carryovers already identified along with the full list of proposed carryovers to 2019/20 for inclusion in the Final 2019/20 Annual Plan will be submitted to the Community Plan Committee for approval in June 2019.

Asset Sales

45. The following table is a summary of the net asset sales position to 31 March 2019:

46. The forecast favourable variance is due to a significant number of sales that were planned for last financial year but have already been completed or are expected to be completed this financial year including Mitchell Park, Avalon Park North, Durham Crescent, Copeland Street and Strategic Properties. Mitchell Park, Avalon Park North, Durham Crescent and Strategic Properties have been completed and are included in the YTD numbers.

Part E: Treasury Management

Summary for the Year

47. The total amount of new debt issued in the first quarter was $14M, which included $4M of new debt to partially prefund $24M of Council debt maturing in 2018/19. In addition, $10M of new debt was issued in the same period to part fund Council’s 2018/19 capital works programme, initially funded through Council’s commercial paper programme.

48. $10M of term debt matured in the first quarter and was repaid using Council’s pre-funding held on term deposit. $5M of commercial paper was refinanced in quarter 1 to retain the programme at $11M, necessary to offset the additional costs of Council’s credit facility of $35M (increased from $15M earlier this year).

49. The total amount of new debt issued in the second quarter was $10M, to part fund Council’s 2018/19 capital works programme. This was a mix of Fixed and Floating debt issuance via LGFA ($5M each).

50. No debt matured in the second quarter, however, $11M of commercial paper was refinanced in quarter 2 to retain the programme at $11M, necessary to offset the additional costs of Council’s credit facility of $35M (increased from $15M earlier this year).

51. During the third $11M of commercial paper was repaid and $14M of pre-funded debt matured. $17M of new debt was issued, $10M of which was used to repay commercial paper, $4M was on-lent to CCOs, and $3M was to pre-fund Councils only debt maturity in the 2019/20 Financial Year.

52. The Official Cash Rate (OCR) has remained constant at 1.75%.Council’s weighted average cost of borrowings as at 31 March 2019 was 3.81% (31 December 2018: 3.67%).

53. All of Council’s Treasury Risk Management Policy limits have been complied with and are shown below as at 31 March 2019:

Item	Borrowing Limit	Calculated	Within Limit	Comments
Net External Debt / Total Revenue	<150%	112%	Yes	Based on annualised revenue
Net Interest on External Debt / Total Revenue	<10%	4%	Yes
Liquidity Ratio	>110%	128.67%	Yes

54. The table below presents Council’s debt maturity profile and compliance with its debt maturity buckets. “Linked assets” represent the loans on-lent to Council’s CCOs and “Available” represents Council’s credit line facility.

55. The table below presents Council’s hedging position and compliance with its floating/fixed hedging limits.

56. As at 31 March 2019, Council had $204M of gross borrowings (including borrowings on behalf of CCOs). Council borrows at least cost which is mainly at floating interest rates. The floating/fixed mix is shown below:

57. To mitigate interest rate risk, Council enters into notional interest rate swap agreements with banks. Council “pays” a fixed interest rate in “return” for a floating interest rate, rolled over quarterly for the term of the swap agreement.

58. Council’s interest rate swaps result in Council’s floating/fixed borrowings ratio now being 33% ($68M) floating and 67% ($136M) fixed. This is shown by way of a diagram below:

Consultation

59. There are no consultation requirements arising from this report.

Legal Considerations

60. There are no legal considerations arising from this report.

Financial Considerations

61. There are no financial considerations in addition to those already noted in this report.

Other Considerations

62. In making this recommendation, officers have given careful consideration to the purpose of local government in section 10 of the Local Government Act 2002. Officers believe that this recommendation falls within the purpose of local government in that it provides Councillors with the necessary information to effectively undertake their governance role.

Appendices

No.	Title	Page
1 ⇩	Activity Statements & Project Lists	38

Author: Philip Benseman

Acting Chief Financial Officer

Approved By: Brent Kibblewhite

General Manager Corporate Services

73 08 May 2019

Finance and Performance Committee

05 February 2019

File: (19/134)

Report no: FPC2019/2/81

Review of Draft 2019/20 Statement of Intent for the New Zealand Local Government Funding Agency

Purpose of Report

1. The purpose of this report is to provide the Committee with the draft 2019/20 Statement of Intent (SOI), that sets out the intentions and expectations of the Local Government Funding Agency Limited (LGFA), for the three years ended 30 June 2022.

Recommendations

That the Committee:

(i) notes and receives the contents of the Local Government Funding Agency (LGFA) draft 2019/20 Statement of Intent attached as Appendix 1 to the report; and

(ii) notes that officers have not asked the LGFA board to consider any changes to the draft LGFA 2019/20 Statement of Intent.

Background

2. The LGFA was incorporated on 1 December 2011 with the primary objective of optimising the debt funding terms and conditions for Participating Local Authorities. This includes providing savings in annual interest costs, making longer-term borrowings available and enhancing the certainty of access to debt markets.

3. The LGFA meets the Local Government Act 2002 (LGA) definition of a Council Controlled Organisation (CCO) and as a shareholder in a CCO, Council must regularly undertake performance monitoring of that organisation to evaluate its contribution to the achievement of Council’s outcomes.

4. As a CCO, the LGFA must deliver to its shareholders a draft SOI on or before 1 March each year. The LGFA Board must consider any comments from its shareholders in relation to the draft SOI and deliver a final SOI to its shareholders on or before 30 June.

5. As a shareholder, Council is statutorily required to review the draft SOI and, as soon as is practicable after receiving it to either agree to it or, if it does not agree to provide feedback with regard to any changes it wishes to be made. Feedback can be provided either directly to the LGFA Board or through the Shareholders Council before 30 April 2019.

6. The Shareholders Council comprises five to 10 appointees from Council shareholders and the Crown and as part of its role, is required to make recommendations to the shareholders in relation to the draft SOI.

7. For shareholder Councils, the LGFA is focused on:

a. delivering a strong financial performance;

b. monitoring asset quality;

c. enhancing their approach to treasury and risk management; and

d. ensuring it has an effective governance framework and capital structure in place.

8. For borrowing Councils, the LGFA seeks to optimise funding terms and conditions by achieving savings in borrowing costs, provide longer-dated finding and provide certainty of access to markets.

Letter of Expectation

9. The Shareholders Council issued a Letter of Expectation to the LGFA Board outlining suggestions that the LGFA Board and management should consider when drafting its 2019/20 draft SOI. A copy of the Letter of Expectation is attached as Appendix 2 to this report.

10. The LGFA considered the suggestions raised by the Shareholders Council in the Letter of Expectation it received and in turn responded to the Shareholders Council with a letter that addressed the suggestions raised by the Shareholders Council. A copy of the subsequent LGFA letter is attached as Appendix 3 to this report.

Draft 2019/20 SOI Key Points Summary

11. No changes have been made to the on-lending margins given the base lending margin now averages 10 basis points (bps) or 0.01%. Any further reductions in the base margin are unlikely as LGFA need to ensure they have sufficient capital to match the growth in the balance sheet. LGFA on-lending margins are the narrowest when compared with their international peers.

12. The SOI performance targets are similar to the targets in the 2018/19 SOI, however, the objective relating to savings to council borrowers has been replaced with a survey-based measure as the perceived “value add” by LGFA to councils as it was becoming increasingly difficult for the LGFA to accurately measure savings in borrowing costs due to the lack of single name bond issuance by councils who are not members of LGFA.

13. Profitability is forecast to remain strong with projections for Net Operating Gain of $10.9M, $11.2M and $10.9M for the next three years, similar to results from previous years. Net interest income is expected to remain constant as the LGFA balance sheet grows from council lending and additional liquid assets are required to be held to manage LGFA bond maturities, however, this will be offset by a modest reduction in on-lending margins as loans to councils made in previous years at higher margins are refinanced by councils at maturity with lower margin loans.

14. Caution regards forecast performance in year 2020/21 has been emphasised given that over the next three years, $3.79 B of LGFA bonds and $3.34B of Council loans mature. Assumptions have been made regarding the timing of Council loan refinancing and interest rates.

15. LGFA has increased their forecast for Local Government loans outstanding as at 30 June 2020 to $9.5B (previously $8.4B) and to $9.8B as at 30 June 2021 (previously $8.2B). This reflects the higher long-term borrowing requirement outlined by councils in their 2018-2028 Long Term Plans, increased utilisation of short term borrowing by councils and a surge in new council members who typically refinance their debt with LGFA upon joining.

Consultation

16. Public consultation is not required.

17. The draft SOI was received by Council officers before the 1 March 2019 deadline but too late for inclusion in the reports distributed for the meeting of the Committee held on 6 March 2019. The consideration of this report by the Committee is being held after the deadline for providing any comments on the draft SOI to the LGFA board. As a result officers circulated the documents attached as appendices to this report, along with officers observations and comments (many of which are contained in this report), via email to members of the Committee requesting should a member want a change to the draft SOI to be considered, they should forward it to the Chair of the Committee for his and the General Manager Corporate Services consideration by Monday 29 April 2019. No suggested changes were received by the Chair and none have been passed on to the LGFA board.

Legal Considerations

18. The LGFA Board must consider any comments on the draft SOI that are made within two months of 1 March by its shareholders or the Shareholders Council.

19. The LGFA Board must deliver a completed SOI to its shareholders on or before 30 June 2019.

Financial Considerations

20. The draft SOI contains the financial forecasts for LGFA for the three year period commencing 1 July 2019.

21. The Total Equity of LGFA is estimated to be $85.5M at 30 June 2020.

Other Considerations

22. In making this recommendation, officers have given careful consideration to the purpose of local government in section 10 of the Local Government Act 2002. Officers believe that this recommendation falls within the purpose of local government in that it is a requirement for the LGFA board to submit to its shareholders, a draft SOI for consideration and on which to provide feedback.

Appendices

No.	Title	Page
1 ⇩	LGFA Draft SOI 2019-20	74
2 ⇩	LGFA Letter of Expectation 2019-20	87
3 ⇩	LGFA Letter to Shareholders Council re 2019/20 SOI Letter of Expectation	90

Author: Brent Kibblewhite

General Manager Corporate Services

Approved By: Tony Stallinger

Chief Executive

95 08 May 2019

Finance and Performance Committee

05 February 2019

File: (19/135)

Report no: FPC2019/2/82

New Zealand Local Government Funding Agency Six Month Report to 31 December 2018

Purpose of Report

1. The purpose of this report is to provide the Committee with the Local Government Funding Agency (LGFA) Six Month Report to 31 December 2018.

Recommendations

That the Committee notes and receives the Local Government Funding Agency (LGFA) Six Month Report to 31 December 2018, attached as Appendix 1 to the report.

Background

2. The LGFA was incorporated on 1 December 2011 with the primary objective of optimising the debt funding terms and conditions for participating local authorities. This includes providing savings in annual interest costs, making longer-term borrowings available and enhancing the certainty of access to debt markets.

3. Council became a principal shareholding local authority in the LGFA in May 2012. Council owns 0.44% of LGFA (unchanged) through 200,000 (out of 45 million) ordinary shares on issue.

4. The LGFA issues bonds to wholesale and retail investors and on-lends the funds raised to participating local authorities with borrowing needs. The quality of the LGFA’s credit rating, and the liquidity created by issuing homogenous local authority paper, ensures that participating Councils can raise funds from the LGFA on better terms than if they were issuing in their own name.

5. Borrowing Councils are required to subscribe for LGFA Borrower Notes (subordinated convertible non-voting bonds), at 1.6% of the face value of each borrowing from LGFA. LGFA requires the Borrower Notes as equity as their balance sheet grows and this avoids the need to continually go back to shareholders for additional capital. Borrower Notes pay interest on maturity of the notes at LGFA’s cost of funds.

6. The LGFA meets the Local Government Act 2002 (the Act) definition of a Council Controlled Organisation (CCO) as one or more local authorities have the right, directly or indirectly, to appoint 50% or more of the directors.

7. CCO’s are required to provide a six monthly financial and performance report to its shareholders.

Discussion

8. During the six-month period to 31 December 2018:

a. Interest income of $180.9M was a 1.5% increase over the 2017/18 comparable period. Net operating profit of $6.08M was a 0.7% increase on the 2017/18 comparable period. Both interest income and net operating profit were ahead of the Statement of Intent (SOI) forecast due to the early refinancing of loans by councils maturing in March 2019 and a higher level of new council borrowing.

b. Standard & Poor’s and Fitch both reaffirmed their credit ratings for LGFA as ‘AA+’, the same as the New Zealand Government.

c. A record $985M of bonds were issued with outstandings now totalling $9.1B.

d. Five new council members joined bringing total membership to 61 councils.

9. By 31 December 2018, LGFA had $9.3B in loans outstanding to 58 participating Councils.

10. Hutt City Council only borrows from the LGFA if they represent the best value for money after considering the terms and conditions from other lenders in the market place.

11. Council has borrowed $187.9M from the LGFA as at 31 December 2018 (30 June 2018: $157.8M). The increase of $30M since 30 June 2018 is due to $14M of pre-funding of debt due to mature in March 2019, and $16M of new debt to part-fund Council’s 2018/19 capital works programme.

12. LGFA Borrowings include those on behalf of Council’s CCOs and all borrowings are in accordance with approved limits contained in Council’s Treasury Risk Management Policy.

13. Council had $2.8M of LGFA Borrower Notes as at 31 December 2018 (30 June 2018: $2.5M).

14. The full LGFA Half Year Report to 31 December 2018 is attached as Appendix 1 to this report.

Consultation

15. There are no consultation requirements arising from this report.

Legal Considerations

16. Within two months after the end of the first half of each financial year, the board of a CCO must deliver to the shareholders a report on the organisations operations during that half year. The LGFA half year report for the six months ending 31 December 2018 was provided to Council Officers on 27 February 2019, within the statutory deadline.

17. There are no other legal considerations arising from this report.

Financial Considerations

18. LGFA Borrowings include those on behalf of Council’s CCOs ($14.7M).

19. All borrowings are in accordance with approved limits contained in Council’s Treasury Risk Management Policy.

Other Considerations

20. In making this recommendation, officers have given careful consideration to the purpose of local government in section 10 of the Local Government Act 2002. Officers believe that this recommendation falls within the purpose of local government in that it allows Council to operate in a cost-effective manner.

Appendices

No.	Title	Page
1 ⇩	LGFA Half Year Report to 31 December 2018	96

Author: Brent Kibblewhite

General Manager Corporate Services

Approved By: Tony Stallinger

Chief Executive

144 08 May 2019

Finance and Performance Committee

24 April 2019

File: (19/518)

Report no: FPC2019/2/83

Information on Potential New Performance Measures for Urban Plus Ltd

Purpose of Report

1. Provide information on potential new performance measures for Urban Plus Limited (UPL), in line with relevant references in UPL’s existing Statement of Intent 2018/19-20/21, and in line with Council’s Zero by 2050 carbon target and other relevant sustainability objectives.

Recommendations

It is recommended that the Committee:

(i) notes that UPL’s Statement of Intent 2018/19-20/21 already makes direct references to various desired sustainability outcomes (eg, “best practice”, “providing warmer, healthier homes”), but it currently lacks specific performance measures to objectively measure, verify and report these outcomes achieved by Urban Plus Ltd;

(ii) notes that a range of tools and standards are available that could be used as potential performance measures;

(iii) notes that a minimum HomeStar 6 (or higher) rating requirement could be applied to homes where design has not yet been finalised, or onward from a particular point in time, and to report on this performance requirement annually;

(iv) notes that UPL could be required to undertake a survey of its rental properties, to establish the performance of these against the HomeFit standard, and to report on this performance standard annually;

(v) notes that a “no gas policy” could be applied to homes where design has not yet been finalised, or onward from a particular point in time, and to report on this performance requirement annually;

(vi) notes that a minimum GreenStar rating of 4 could be applied to any applicable future commercial development;

(vii) notes that officers are currently discussing these potential performance measures with UPL staff and the UPL Board; and

(viii) agrees that officers will report back to the Committee in July 2019 with recommendations on the next steps.

For the reason that this information was requested in the context of implementing Council’s organisational Zero by 2050 carbon target, set in December 2018.

Background

2. In December 2018, Council agreed to set an organisational Zero by 2050 carbon target. As part of the work, and to give effect to this target, it was acknowledged that new performance measures may be needed, in order to translate the target into specific and measurable outcomes for its different business units and activity areas, such as the procurement of assets and services, the management of its vehicle fleet, and the management of waste.

3. In addition to Council’s business areas, Council has direct control of its wholly-owned Urban Plus Ltd, Community Facilities Trust, and Seaview Marina Ltd. Council is also a shareholder in Wellington Water Ltd. These Council Controlled Organisations (CCOs) deliver services and/or key outcomes on behalf of Council.

4. Council has the ability to set (or at least influence) performance measures to drive desired outcomes delivered by those entities. With regard to its own business units, this could be done through internal key performance indicators or objectives. With regard to its CCOs, this can be done through their respective Statements of Intent.

5. Note that apart from Council’s carbon target, Council also has in place other plans or strategies that state its desired outcomes (quantified or unquantified) in relation to sustainability matters. This includes the Wellington Region Waste Minimisation and Management Plan 2017-23, and Council’s Environmental Sustainability Strategy 2015-45.

6. Over the last four months, officers have undertaken analysis and commissioned advice on potential performance measures to deliver on Council’s desired carbon and sustainability outcomes. As this work touches on a wide range of Council’s business areas, it is being undertaken in stages.

7. Potential performance measures for CCOs or business units focused on the construction of new buildings have been prioritised, as key decisions (such as the choice of energy source for water and space heating) are made at the design stage, and there is an opportunity to avoid locking in high carbon technologies. Once buildings are constructed, it can be expensive to make changes or retrofit low carbon technologies later.

8. This report focuses on potential new performance measures for Urban Plus Ltd, as its current activities include, but are not limited to, residential property development and rental property management. As at March 2019, UPL holds over 170 rental housing units, and is in the process of constructing 24 homes and planning 61 homes.

9. Information on potential new performance measures related to commercial buildings commissioned by other CCOs (eg, Community Facilities Trust) and business areas is still being compiled and analysed, and officers will report back on these in due course.

Efficiency and sustainability in new residential housing developments

10. New housing can result in a range of impacts, such as carbon emissions associated with energy use to heat space, water and run appliances, waste produced as a result of construction activities, and increased storm water loads as a result of increased surface area run-off as new areas are developed.

11. In relation to the development of new residential housing, it is worth emphasising that New Zealand’s building code only sets minimum requirements (eg, insulation), rather than require best practice, and is below the standards required in other Organisation for Economic Co-operation and Development (OECD) countries. It also does not address issues associated with the construction of new buildings (eg, waste).

12. HomeStar is an independent and recognised rating tool developed by the New Zealand Green Building Council, for houses at the design stage, new builds and houses (usually stand-alone homes) that are less than three years old. The tool measures liveability across several performance categories such as energy, health and comfort, water and waste.

13. HomeStar ratings are calculated based on the points achieved in the various performance categories. A total of 100 points are on offer (plus some additional bonus points). However, at least 60 points are required in order for a home to attain a HomeStar rating of 6, the minimum required for formal certification, with a 10-star rating available for demonstrating outstanding performance.

14. Note that a home constructed to building code requirements is expected to only achieve a rating of 3 to 4 stars.

15. Council’s Eco Design Advisor, who is certified as a HomeStar assessor, assessed three homes recently constructed by UPL, and found that these homes would achieve the equivalent of only 3 stars on the HomeStar rating scale.

16. An analysis was carried out to estimate the costs of bringing these particular homes up to a 6-star rating, with the following results: improved insulation and windows ($3,500), water use and moisture control ($1,500), different materials ($1,900), construction waste management ($1,000) and native plantings ($700). In addition, where the home is not already equipped with a device for sufficient space heating (eg, heat pump), this would need to be added.

17. The above findings imply that current UPL outcomes with regard to new residential housing developments are not in line with best practice, even though UPL’s current Statement of Intent 2018-21 references key outcomes such as “best practice”, “passive design” and “minimising energy consumption” in its section on “Contribution to Outcomes”.

18. Officers consider that HomeStar 6 or higher could be used by UPL as a performance measure in the CCO’s Statement of Intent, with the following advantages and disadvantages.

Advantages

19. UPL would establish a measurable and verifiable performance measure in line with Council and Community outcomes and objectives, such as reducing carbon emissions and waste.

20. HomeStar ratings (6 or higher) are associated with carbon emission savings. These are estimated at 335 kgCO₂ per year, in the Wellington region, for a HomeStar 6 rated home compared to conventional construction in line with the New Zealand building code. Higher HomeStar ratings are associated with larger carbon savings. In addition, there are other public benefits (eg, reduced water use and storm water run-off).

21. HomeStar ratings (6 or higher) are associated with home running cost savings. For a HomeStar 6 rated home in the Wellington region, private benefits are estimated at $490 per year in savings, compared to a conventional construction in line with the New Zealand building code (see SensePartners, Constructing KiwiBuild homes to a standard above the NZ Building Code, June 2018). Considering net present value, SensePartners also estimate that over a 30 year time frame, and using a discount rate of 8%, a Wellington homeowner would be better off by $1,500, despite the higher up front cost.

22. UPL would align with market leaders (eg, Panuku Development Auckland has a Homestar 6 rating requirement at its Hobsonville Point development; ANZ now offers a 0.70% discount off the standard fixed home loan rate for mortgages associated with HomeStar 6 rated homes).

23. Certified sustainable or green homes can attract a price premium over otherwise similar houses. These findings are based on studies that compare sale prices of houses with and without certification that are otherwise similar on other characteristics that explain house price differences.

Disadvantages

24. The estimated additional cost for a HomeStar 6 rated home, compared to a home based on standard construction, is approximately $7,000 based on a 180m²two storey three bedroom home (see SensePartners, Constructing KiwiBuild homes to a standard above the NZ Building Code, June 2018).

25. UPL would face some additional costs or resourcing requirements associated with planning homes, such as the development of waste minimisation plans and record-keeping for audit purposes (costs not quantified), and costs associated with HomeStar accreditation ($300 per home) and assessments ($300-$800 per home), albeit savings can be realised if ratings are applied to building “typologies”).

26. While HomeStar ratings (6 or higher) are associated with potential carbon emission savings, such as through increased insulation and more efficient heating technologies, the rating tool does not currently explicitly consider the carbon intensity of energy sources for water heating, space heating and cooking. Thus, it is possible to construct HomeStar 6 rated homes utilising natural gas (a fossil fuel) for some of its energy requirements.

Potential next steps

27. Introducing a HomeStar rating of 6 or higher as a new performance measure for UPL in its Statement of Intent would likely require sufficient lead-in time (eg, in order to upskill suppliers, to become familiar with the tool, etc,). Therefore, it may not be realistic to require HomeStar 6 or higher as a performance measure for homes where design has already been completed and/or construction has begun.

28. However, a minimum HomeStar 6 (or higher) rating requirement could be applied to homes where design has not yet been finalised or onward from a particular point in time. UPL could then report annually on the HomeStar performance of new homes constructed.

Efficiency and sustainability in existing residential housing developments

29. In relation to assessing the performance of existing housing stock, the New Zealand Green Building Council, in cooperation with relevant industry experts and the Energy Efficiency and Conservation Authority, has developed HomeFit.

30. HomeFit targets existing houses only, and is a benchmark for the minimum standard required for a home to be considered a warm, dry and healthy home.

31. HomeFit can be achieved by complying with all its mandatory criteria (eg, home is free of visible mould, living space can be heated, adequate ventilation, minimum insulation to all accessible roof/floor spaces, no obvious holes or gaps in windows, walls and ceilings, etc,) and at least three from a list of optional criteria (eg, 80% of fixed interior lamps are LED/fluorescent, ceiling insulation at minimum R3.2, etc,).

32. While an inspection-based assessment is available in order to receive formal recognition, self-assessments are acceptable in order to confirm the performance of a home or housing portfolio.

33. The current performance of UPL’s rental housing portfolio is unknown and it is therefore unclear to what extent UPL’s existing rental housing portfolio is in line with best practice, even though UPL’s current Statement of Intent 2018/19-20/21 references key outcomes such as “best practice” and “providing warmer, healthier homes to the low-income elderly” in its section on “Contribution to Outcomes”.

34. Officers consider that HomeFit could be used by UPL as a performance measure in the CCO’s Statement of Intent, with the following advantages and disadvantages.

Advantages

35. UPL would establish a measurable and verifiable performance measure in line with Council and community outcomes and objectives. Note that ensuring that Council’s own housing is warm and healthy is in line with achieving a healthy city in which all residents can prosper in strong and inclusive communities. Council is also a member of the regional Healthy Housing Response Group which focusses on improving house conditions.

36. Self-assessments are free (albeit audited assessments are available) and are relatively easy to perform based on a simple checklist.

37. HomeFit aligns with regulatory requirements (eg, smoke detectors), so can also be used to show relevant regulatory compliance.

Disadvantages

38. Carrying-out audits or self-assessments may potentially identify properties that do not meet the HomeFit standards, which could lead to demands to upgrade the affected properties. This in turn may increase costs for UPL.

Potential next steps

39. As HomeFit can be utilised by applying self-assessments, UPL could be required to undertake a survey of its rental properties, at low cost, to establish performance of these against the HomeFit standard, and to report on this performance annually.

Lowering the carbon intensity of energy sources in new and existing homes

40. Figure 1 shows the energy use in a typical New Zealand home. Water and space heating usually make up the majority of a household’s stationary energy use.

41. Figure 2 shows the carbon intensity of different water heating technologies, which shows that avoiding the use of the natural gas technology is a key mechanism to move to Zero by 2050 with regard to residential energy use.

42. Importantly, where natural gas technology is installed at the time of constructing a new home, it is less likely to be cost effective to move to alternative technologies until the equipment requires renewal, assumed to be 15 years. Therefore, owners of those homes will effectively be “locked” into a high carbon technology pathway for some time.

Figure 1: Energy use in NZ homes	Figure 2: Carbon intensity of water heating options

43. In addition, the carbon intensity of technologies based on electricity is likely to reduce further, as grid electricity currently relies on approximately 80% renewable energy sources, and this is likely to increase further in line with the Central Government’s aim to move to 100% renewable electricity by 2035.

44. UPL has advised that approximately 90% of 24 homes currently under construction will utilise natural gas for water heating and cooking, and all of the 61 homes currently in the design and planning stage are scheduled to be fitted with natural gas for water heating and cooking.

45. This implies that current UPL outcomes with regard to new residential housing developments are not in line with Council’s Zero by 2050 carbon target.

46. Officers consider that a necessary first step would be for UPL to no longer utilise natural gas as an energy source in homes not already under construction, or from a particular point in time. This “no natural gas policy” has the following advantages and disadvantages.

Advantages

47. UPL would establish a measurable and verifiable performance measure in line with Council’s Zero by 2050 carbon target.

48. Align with market leaders. For example, the United Kingdom’s Committee on Climate Change has recommended that by no later than 2025, no new homes should connect to the gas grid.

49. Up-front investment for alternative technologies can be very similar, which means that such policy would not necessarily increase upfront investment costs for UPL or affect UPL profit margins. For example, the upfront costs for an electric hot water cylinder compared to gas continuous flow technology is very similar, at approximately $2,000 as estimated by the Energy Efficiency and Conservation Authority.

Disadvantages

50. While upfront investment costs are similar for an electric hot water cylinder compared to gas continuous flow technology, associated operating costs can differ. For example, the operating costs of an electric hot water cylinder are higher than more efficient technologies such as heat pump water heaters or solar water heaters. But heat pump water heaters or solar water heaters have higher upfront investment costs.

51. There may be some indirect costs associated with moving away from gas continuous flow technology. For example, if installed internally rather than outside, an electric hot water cylinder may use up valuable space inside the home.

Potential next steps

52. It may not be realistic to apply a “no gas policy” to homes where design has already been completed and/or construction has begun. However, such policy could be applied to homes where design has not yet been finalised or onward from a particular point in time.

Efficiency and sustainability in new commercial developments

53. GreenStar is an independent and recognised rating tool developed by the New Zealand Green Building Council, but for commercial building projects, at the design and built stage. While usually applied to office buildings, it can be used for a wide range of building typologies.

54. The tool measures liveability across several impact categories such as energy, transport, water and materials.

55. GreenStar ratings, on a scale of 1-6, are calculated based on points achieved in the various impact categories. The minimum star rating required for formal certification is 4, which represents “best practice”. Higher ratings are associated with New Zealand excellence (5 stars) and World Leadership (6 stars).

56. Considering references to key outcomes such as “best practice”, “passive design” and “minimising energy consumption” in UPL’s current Statement of Intent 2018/19-20/21, officers consider that achieving GreenStar 4 (or higher) could be used by UPL as a performance measure regarding commercial developments that UPL is or may get involved in (such as the potential new Petone Library and Community Centre), with the following advantages and disadvantages.

Advantages

57. UPL would establish a measurable and verifiable performance measure in line with Council and community outcomes and objectives, such as reducing carbon emissions and waste.

58. GreenStar ratings (4 or higher) are associated with potential running cost savings, such as reduced heating requirements.

59. UPL would align with market leaders such as Meridian Energy.

Disadvantages

60. The estimated additional cost for a GreenStar 4 rated building, compared to a building based on standard construction, is 1.5%/m². This increases to approximately 2.7%/m² for a GreenStar 5 rated building.

61. UPL would face some additional costs or resourcing requirements associated with planning the relevant buildings, such as the development of waste minimisation plans and record-keeping for audit purposes (costs not quantified), and costs associated with GreenStar accreditation and assessments (estimated at approximately $22,000 assuming a project value of $3-$10million).

Potential next steps

62. Introducing a GreenStar rating of 4 or higher as a performance measure for UPL in its Statement of Intent would likely require sufficient lead-in time (eg, in order to upskill suppliers, to become familiar with the tool, etc,).

63. UPL is currently involved in the early design considerations of a new Petone Library and Community Centre, and a minimum GreenStar rating of 4 could be set as a target in the first instance to enable familiarisation with the tool.

Legal Considerations

64. There are no legal considerations.

Financial Considerations

65. Some of the performance measures presented in this report are associated with an increase in direct and indirect investment costs (eg, construction costs for homes). If UPL were to be unable to recoup those costs through higher sale prices, it may affect UPL’s ability to achieve agreed profit margins.

Other Considerations

66. In making this recommendation, officers have given careful consideration to the purpose of local government in section 10 of the Local Government Act 2002. Officers believe that this recommendation falls within the purpose of local government in that it meets the future needs of the community by aiming to avoid significant impacts from climate change. It does this in a way that is cost-effective because taking action early means that costs are likely to be lower for households in the long term.

Appendices

There are no appendices for this report.

Author: Jörn Scherzer

Manager, Sustainability and Resilience

Approved By: Helen Oram

Acting General Manager City Transformation

147 08 May 2019

Finance and Performance Committee

17 April 2019

File: (19/492)

Report no: FPC2019/2/51

Tax Risk Governance Framework Update

1. Council approved a Tax Risk Governance Framework in May 2018. This report is to update the Committee on the current year’s tax activities of Council and its Council Controlled Organisations (CCOs), collectively referred to as the “Group”.

Recommendation

That the report be noted and received.

Background

2. Council is currently exempt from paying corporate income tax with the exception for income derived from Council Controlled Organisations (CCOs). CCOs (with the exception of The Hutt City Community Facilities Trust), are however subject to corporate income tax. All entities in the Group are subject to and required to correctly account for all indirect taxes including:

· Goods and Services Tax (GST);

· Fringe Benefit Tax (FBT);

· Pay As You Earn Tax (PAYE); and

· A range of other withholding taxes (WHT).

3. The Group returns in excess of $9.9M annually to the Inland Revenue Department (IRD) in relation to both direct and indirect taxes.

4. IRD has an expectation that all large organisations should have tax risk management incorporated within their governance framework. Council developed a “best practice” tax risk governance framework and tax risk management strategy that was approved by this Committee and subsequently by Council in May 2018.

5. It is a requirement of the framework that officers will report on all tax risk management matters to this Committee at least once a year.

Discussion

6. To the best of officers’ knowledge, all Council and Group returns in respect of direct and indirect taxes have been filed on time and settlements with IRD have been made by the due dates.

Annual Update

7. PricewaterhouseCoopers (PwC) has provided their first annual update, attached as Appendix 1 to this report. PwC’s annual update provides:

· a summary of the more substantive tax advice Council and its CCOs have sought from PwC up to 31 March 2019;

· commentary on tax matters currently being addressed as at 15 April 2019; and

· a more general high-level update on the wider tax environment which may affect Council.

Tax Advice

8. Where the need arises, the Group continues to engage PwC to provide advice on various tax matters. The advice assists the Group to comply with various tax legislations.

9. During the last 12 months, Council sought advice from PwC on:

(a) several property sale and purchase transactions, particular those between Group entities;

(b) preparing for “Payday Filing”;

(d) preparation and lodgement of all Group final income tax returns.

Update of Tax Risk Governance Framework

10. The Tax Risk Management Strategy within the Tax Risk Management Framework, has been extended out to June 2021. A copy of the updated framework, with changes tracked, is attached as Appendix 2 to this report.

Consultation

11. Consultation is not required.

Legal Considerations

12. There are no legal considerations arising from this report.

Financial Considerations

13. There are no financial consideration arising from this report

Other Considerations

14. In making this recommendation, officers have given careful consideration to the purpose of local government in section 10 of the Local Government Act 2002. Officers believe that this recommendation falls within the purpose of local government in that it ensures Council and Groups awareness of tax matters is raised and that a tax governance framework is in place.

Appendices

No.	Title	Page
1 ⇩	PwC - Annual tax update	148
2 ⇩	Tax Risk Governance Framework - updated 17 April 2019	156

Author: Darrin Newth

Financial Accounting Manager

Reviewed By: Philip Benseman

Acting Chief Financial Officer

Approved By: Brent Kibblewhite

General Manager Corporate Services

165 08 May 2019

Finance and Performance Committee

02 April 2019

File: (19/415)

Report no: FPC2019/2/52

TechnologyOne SaaS Project Update

To provide the Finance and Performance Committee with an update on the TechnologyOne SaaS Project and Governance Structure.

Recommendation

That the report be noted and received.

Background

1. At the Finance and Performance Committee meeting on 2May 2018 the business case to move Council’s TechnologyOne software to SaaS (Software as a Service) was approved.

2. The Finance and Performance Committee requested a project update at each meeting while the project is in progress.

Governance

3. Governance meetings are scheduled monthly and additional meetings will be added as needed. With the resignation of General Manager, City Transformation, Kim Kelly, Helen Oram, Acting General Manager, City Transformation, is now a member of the governance committee and is attending the meetings.

Project Update

Scope:

GREEN

Schedule:

AMBER

Financials:

GREEN

Risks:

GREEN

4. Integration development has taken longer than estimated. Although development is now complete and testing is in progress, the delay is putting pressure on the schedule.

5. We are mitigating this by utilising industry standard software development approaches of performing development and testing tasks in parallel. This enables the team to progress items that are complete through the delivery lifecycle, minimising overall impact to the project schedule.

6. This approach has enabled the project to commence acceptance testing with the business on time on 15 April. To date no functional issues have been identified. Items raised are ‘how to’ type questions related to the changes in the way some operations are performed.

7. Currently project is still tracking to a go live over Queens Birthday weekend.

8. Budget Summary

	Budget	Actuals to Date	Forecast	EAC	Variance
TOTAL	$1,500,000	$712,189	$773,244	$1,485,433	(1.0%)

Note – variance is a poistive variance – project is forecast to come in under budget.

9. Risk Summary

Risk	High, Med, Low	Risk Mitigation
Application performance (screen response) is adversely impacted	Med	Performance/Load testing to be done during UAT. Implement performance improvements to bring application performance to acceptable levels.
Information used in the current TechOne to CM9 (Document Management System) integration may not be available through the Cloud Integration method requiring additonal development to make available.	Med	Accept risk. If realised, go live may need to be delayed until a suitable solution can be developed and implemented. Risk Realised – additional development was required. Development is complete with testing in progress to verify delivery.
Business representatives required for User Acceptance Testing (UAT) may not be available in the required timeframe delaying execution of tests and verification of system.	Low	GM and DM level Governance Group established to facilitate prioritisation, verify acceptable go live date based on business as usual activities and ensure availability of cross Council representation to meet dates.

Appendices

There are no appendices for this report.

Author: Rick Newton

Business Transformation Manager

Approved By: Lyndon Allott

Chief Information Officer

Attachment 1

Finance and Performance Work Programme

Finance & Performance Committee Work Programme 2019

Cycle 2 8 May 2019	Officer	For Council
JSP – Extension of Area Subject to Targeted Rate	W Moore
Information on Potential New Performance Measures for UPL	J Scherzer
Tax Risk Governance Framework Update	D Newth
Financial Report for the Period Ended 31 March 2019	P Benseman
Strategic Property Portfolio - Six Monthly Update	G Craig
NZ LGFA Six Month Report to 31 December 2018	B Kibblewhite
Review of 2019/20 SOI for the NZ LGFA	B Kibblewhite
Technology One SaaS Project Update	R Newton
Finance & Performance Work Programme	Committee Advisor

Cycle 3 17 July 2019	Officer	For Council
Risk and Assurance Update and Operational Risk Register	E Davids
Internal Audit Plan 2019 - 2022	E Davids
2019/20 Revenue Increase and Cost Reduction Target Update	P Benseman/A Yip
Carbon Targets for CCOs	J Scherzer
Information on Options for Delivery of Council Housing	J Pritchard
Technology One SaaS Project Update	R Newton
Finance & Performance Work Programme	Committee Advisor

Cycle 4 4 September 2019	Officer	For Council
Standard and Poor’s Credit Rating Review	J Livschitz
2018/19 Financial Performance and Position	P Benseman/D Newth
Sale & Supply of Alcohol (Fees) Regulations 2013 – Regulation 19 (1) – Reporting by Territorial Authorities	D Bentley
Audit NZ Final Management Report	D Newth
Fraser Park Sportsville Update	M Reid
Annual Reports for CCOs – CFT, SML, UPL	B Kibblewhite
Annual Report for LGFA	J Livschitz
Health & Safety Officer Due Diligence Report	A Kok
Technology One SaaS Update	R Newton
Finance & Performance Work Programme	Committee Advisor
26 September 2019	Officer	For Council
Hutt City Council’s Annual Report	Corporate Planner/J Livschitz	·

Previous 2019 Meeting

Cycle 1 6 March 2019	Officer	For Council
Draft SOIs for CCOs – CFT, SML, UPL	B Cato/B Kibblewhite	·
Wellington Water Limited’s Shareholders Agreement and Constitution	T Stallinger	·
Six Monthly Reports for CCOs – CFT, SML, UPL	CCO GM/CEs & B Kibblewhite
Financial Report for the Period Ended 31 December 2018	P Benseman/D Newth
Progress Update on the Re-design of Council’s Combined Rates Invoice	H Stringer
2019/20 Revenue Increase and Cost Reduction Target Update	P Benseman/A Yip
Health & Safety Officer Due Diligence Report	T Heron
Technology One SaaS Project Update	R Newton
Bulk Water Supply	B Hodgins
Finance & Performance Work Programme	Committee Advisor

[1] 26 July 1994, Policy and Finance Committee paper

[3] 26 July 1994, Policy and Finance Committee paper

[5] 26 July 1994, Policy and Finance Committee paper

Deputy Mayor D Bassett	Cr G Barratt
Cr C Barry	Cr J Briggs
Cr MJ Cousins	Cr S Edwards
Cr M Lulich
Mayor WR Wallace (ex-officio)

Determine and monitor:

Consider and make recommendations to Council:

General: