HuttCity_TeAwaKairangi_BLACK_AGENDA_COVER

 

 

 

19 October 2020

 

 

 

Order Paper for Council meeting to be held in the

Council Chambers, 2nd Floor, 30 Laings Road, Lower Hutt,

on:

 

 

Tuesday 27 October 2020 commencing at the conclusion of the Long Term Plan/Annual Plan Subcommittee

 

 

 

Membership

 

 

Mayor C Barry (Chair)

Deputy Mayor T Lewis

Cr D Bassett

Cr J Briggs

Cr K Brown

Cr B Dyer

Cr S Edwards

Cr D Hislop

Cr C Milne

Cr A Mitchell

Cr S Rasheed

Cr N Shaw

Cr L Sutton

 

 

 

 

 

 

For the dates and times of Council Meetings please visit www.huttcity.govt.nz

 

Have your say

You can speak under public comment to items on the agenda to the Mayor and Councillors at this meeting. Please let us know by noon the working day before the meeting. You can do this by emailing DemocraticServicesTeam@huttcity.govt.nz or calling the Democratic Services Team on 04 570 6666 | 0800 HUTT CITY


HuttCity_TeAwaKairangi_SCREEN_MEDRES
 

 

 

 


COUNCIL

 

Membership:

13 

Meeting Cycle:

Council meets on a six weekly basis (Extraordinary Meetings can be called following a resolution of Council; or on the requisition of the Chair or one third of the total membership of Council)

POWER TO (BEING A POWER THAT IS NOT CAPABLE OF BEING DELEGATED)1:

        Make a rate.

       Make bylaws.

       Borrow money other than in accordance with the Long Term Plan (LTP).

        Purchase or dispose of assets other than in accordance with the LTP.

        Purchase or dispose of Council land and property other than in accordance with the LTP.

        Adopt the LTP, Annual Plan and Annual Report.

        Adopt policies required to be adopted and consulted on under the Local Government Act 2002 in association with the LTP or developed for the purpose of the Local Governance Statement.

        Appoint the Chief Executive.

        Exercise any powers and duties conferred or imposed on the local authority by the Local Government Act 1974, the Public Works Act 1981, or the Resource Management Act 1991, that are unable to be delegated.

        Undertake all other actions which are by law not capable of being delegated.

        The power to adopt a Remuneration and Employment Policy for Council employees.

 

DECIDE ON:

Policy issues

       Adoption of all policy required by legislation.

       Adoption of strategies, and policies with a city-wide or strategic focus.

 

District Plan

       Approval to call for submissions on any Proposed District Plan, Plan Changes and Variations.

       Prior to public notification, approval of recommendations of District Plan Hearings Subcommittees on any Proposed Plan, Plan Changes (including private Plan Changes) and Variations, on the recommendation of the Regulatory Committee.

 

1       Work required prior to the making of any of these decisions may be delegated.

       The withdrawal of Plan Changes in accordance with clause 8D, Part 1, Schedule 1 of the Resource Management Act 1991.

       Approval, to make operative, District Plan and Plan Changes (in accordance with clause 17, Part 1, Schedule 1 of the Resource Management Act 1991).

       Acceptance, adoption or rejection of private Plan Changes.

 

Representation, electoral and governance matters

        The method of voting for the Triennial elections.

        Representation reviews.

        Council’s Code of Conduct for elected members

        Local Governance Statement.

        Elected Members’ Remuneration.

        The outcome of any extraordinary vacancies on Council.

        Any other matters for which a local authority decision is required under the Local Electoral Act 2001.

        Appointment and discharge of members of committees when not appointed by the Mayor.

        All matters identified in these Terms of Reference as delegated to Council Committees (or otherwise delegated by the Council) and oversee those delegations.

        Council‘s delegations to officers and community boards.

 

Delegations and employment of the Chief Executive

Review and negotiation of the contract, performance agreement and remuneration of the Chief Executive.

 

Meetings and committees

        Standing Orders for Council and its committees.

        Council’s annual meeting schedule.

 

Long Term and Annual Plans

        The adoption of the budgetary parameters for the LTP and Annual Plans.

        Determination of rating levels and policies required as part of the LTP.

        Adoption of Consultation Documents, proposed and final LTPs and proposed and final Annual Plans.

 

Council Controlled Organisations

        The establishment and disposal of any Council Controlled Organisation or Council Controlled Trading Organisation.

        Approval of annual Statements of Corporate Intent for Council Controlled Organisations and Council Controlled Trading Organisations.

 

Community Engagement and Advocacy

        Receive reports from the Council’s Advisory Groups.

        Monitor engagement with the city’s communities.

 

Operational Matters

        National Emergency Management Agency matters requiring Council’s  input.

        Road closing and road stopping matters.

        Approval of overseas travel for elected members.

        All other matters for which final authority is not delegated.

 

Appoint:

        The non-elected members of the Standing Committees, including extraordinary vacancies of non- elected representatives.

        The Directors of Council Controlled Organisations and Council Controlled Trading Organisations.

        Council’s nominee on any Trust.

        Council representatives on any outside organisations (where applicable and time permits, recommendations for the appointment may be sought from the appropriate Standing Committee and/or outside organisations).

        The Chief Executive of Hutt City Council.

        Council’s Electoral Officer, Principal Rural Fire Officer and any other appointments required by statute.

        The recipients of the annual Civic Honours awards.

 

    


HUTT CITY COUNCIL

 

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

 Tuesday 27 October 2020 commencing at the conclusion of the Long Term Plan/Annual Plan Subcommittee.

 

ORDER PAPER

 

Public Business

 

 

1.       APOLOGIES 

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

Members are reminded of the need to be vigilant to stand aside from decision making when a conflict arises between their role as a member and any private or other external interest they might have.

4.       Committee Minutes with Recommended Items

          Long Term Plan/Annual Plan Subcommittee

          24 September 2020                                                                                           8

          Recommended Items

          Item 4i)   The strategic context and key assumptions for the City Plan and Long Term Plan 2021-2031 (20/901)      
                                                                                                          11

MAYOR’s Recommendation:

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

Item 4ii)  Long Term Plan 2021-2031, Financial aspects (20/988)
                                                                                                          13

MAYOR’s Recommendation:

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

 

Item 4iii) Revenue and Financing Policy review (20/863)
                                                                                                          15

MAYOR’s Recommendation:

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

Item 4iv) Rating Policy Review (20/989)    
                                                                                                          18

MAYOR’s Recommendation:

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

Item 4v)  Development Contributions Policy Review (20/909)   
                                                                                                          20

MAYOR’s Recommendation:

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

Item 4vi) Three Waters investment options for the 2021-31 Long Term Plan (20/1001)           
                                                                                                          22

MAYOR’s Recommendation:

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

5.       RECOMMENDATIONS TO COUNCIL FROM THE LONG TERM PLAN/ANNUAL PLAN SUBCOMMITTEE MEETING HELD ON 27 OCTOBER 2020 (20/1216)

“That Council adopts the recommendations made on the following reports, and any amendments or additional items agreed at the Long Term Plan/Annual Plan Subcommittee meeting held on 27 October 2020:

(i)           Long Term Plan Amendment – Recycling and Rubbish Collection;

(ii)          2021-2031 Long Term Plan – vision, goals and emerging options;

(iii)         Long Term Plan 2021-2031- Financial aspects;

(iv)         Long Term Plan 2021-2031 Rating Policy Review update report #2;

(v)          Three Waters Investment 2031-2031 Long Term Plan; and

(vi)         Draft Heritage Policy 2020.”

 

 

 

 

6.       Local Government Funding Agency - Annual General Meeting (20/1240)

Report No. HCC2020/6/225 by the Treasury Officer                                        24

Mayor’s Recommendation:

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

  

7.       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.   

 

 

8.       CLOSING FORMALITIES - Karakia WHAKAMUTUNGA

 

Whakataka te hau ki te uru

Whakataka te hau ki te tonga

Kia mākinakina ki uta

Kia mātaratara ki tai

E hī ake ana te atakura

He tio, he huka, he hau hū

Tīhei mauri ora.

Cease the winds from the west
Cease the winds from the south
Let the breeze blow over the land
Let the breeze blow over the ocean
Let the red-tipped dawn come with a sharpened air. 
A touch of frost, a promise of a glorious day.

 

 

 

 

Kate Glanville

SENIOR DEMOCRACY ADVISOR

                      


HUTT CITY COUNCIL

 

Long Term Plan/Annual Plan Subcommittee

 

Minutes of a meeting held in the Council Chambers,
2nd Floor, 30 Laings Road, Lower Hutt
on

 Thursday 24 September 2020 commencing at 2.00pm

 

 

 

PRESENT:

Mayor C Barry (Chair)

Deputy Mayor T Lewis

 

Cr D Bassett

Cr J Briggs

 

Cr K Brown

Cr B Dyer

 

Cr S Edwards

Cr D Hislop

 

Cr C Milne

Cr A Mitchell

 

Cr N Shaw

Cr L Sutton

 

APOLOGIES:                  Cr S Rasheed

 

IN ATTENDANCE:       Ms J Miller, Chief Executive

Ms A Blackshaw, Director Neighbourhoods and Communities

Ms H Oram, Director Environment and Sustainability (part meeting)

Ms A Welanyk, Director Transformation and Resources 

Mr K Puketapu-Dentice Director, Economy and Development (part meeting)

Mr M Boggs, Director Strategy and Engagement

Ms J Livschitz, Chief Financial Officer

Mr B Cato, Chief Legal Officer (part meeting)

Ms W Moore, Head of Strategy and Planning

Mr B Hodgins, Strategic Advisor

Mr J Gloag, Head of Transport

Mr M Sherwood, Head of Parks and Recreation

Ms C Ellis, Senior Communications Advisor

Ms K Stannard, Head of Democratic Services (part meeting)

Mr D Koenders, Manager, Financial Strategy and Planning

Mr J Pritchard, Principal Research and Policy Advisor

Ms H Stringer, Financial Transaction Services Manager

Ms A Andrews, Business Analyst – Rates and Finance

Mr J Scherzer, Sustainability and Resilience Manager

Mr J Linders, Energy Advisor

Ms K Glanville, Senior Democracy Advisor

Ms H Clegg, Minute Taker

 

 

PUBLIC BUSINESS

 

 

 

 

          OPENING FORMALITIES - Karakia Timatanga 

Kia hora te marino

Kia whakapapa pounamu te moana

He huarahi mā tātou i te rangi nei

Aroha atu, aroha mai

Tātou i a tātou katoa

Hui e Tāiki e!

May peace be wide spread

May the sea be like greenstone

A pathway for us all this day

Let us show respect for each other

For one another

Bind us together!

 

1.             APOLOGIES 

Resolved:   (Mayor Barry/Cr Brown)                              Minute No. LTPAP 20501

“That the apology received from Cr Rasheed be accepted and leave of absence be granted.”

2.             PUBLIC COMMENT

There was no public comment.

 

3.             CONFLICT OF INTEREST DECLARATIONS     

          There were no conflict of interest declarations.

4.             Recommendations to Council – 8 December 2020

i)

The strategic context and key assumptions for the City Plan and Long Term Plan 2021 - 2031 (20/901)

 

The Head of Strategy and Planning elaborated on the report.  She was confident that all the key assumptions from an Elected Members hui held recently had been encapsulated in the report.  She added that the three lenses of climate change, equity and financial sustainability had been recognised.

In response to a question from a member, the Director Economy and Development advised bullet point 2 of paragraph 5 of the officer’s report should have the word “tino” deleted while retaining the word “rangatiratanga”.  This translated to self determination.

In response to a question from a member, the Head of Strategy and Planning advised the city did not currently have a City Plan.  She said four key strategies: Urban Growth; Leisure and Recreation; Environment; and Infrastructure formed an integrated vision for the city.  She explained a City Plan was forward thinking and the proposed City Plan would cover 30 years from 2024.  She advised it would be reviewed every three years in line with the Long Term Plan (LTP) and could be “tweaked” if necessary. 

In response to questions from a member, the Head of Strategy and Planning advised the existing four strategies fed into the City Plan.  She said that ideally there should be a small number of high level strategies, with many plans for implementation emerging from them.  She added this approach enabled Council to present a coherent, longer term direction to the community, and would provide the flexibility to deliver that direction.  She further advised that this approach also ensured the impact of a decision on all four strategies could be easily evaluated, resulting in fully transparent decision making.  She noted that once the City Plan was adopted, all reports to Council would reflect on it.

In response to a question from a member, the Head of Strategy and Planning advised Council’s Strategy and Planning team were working closely with Council’s District Plan Review team, to ensure the City Plan and the Lower Hutt District Plan used the same aspirations and visions.  She advised the first step of the City Plan would be to consult with mana whenua.

 

 

recommended: (Mayor Barry/Deputy Mayor Lewis)
                                                                                    Minute No. LTPAP 20502

“That the Subcommittee recommends that Council:

(i)      notes the strategic context for the development of the City Plan and the Long Term Plan 2021-31;

(ii)     agrees the key directions, assumptions, and priorities;

(iii)    agrees these key directions, assumptions, and priorities will underpin:

(a)     the planning, strategy and policy documents that make up the 2021 -31 Long Term Plan; and

(b)     all future planning, strategy and policy development; 

(iv)    establishes a working group to provide ongoing guidance on the Long Term Plan consultation document and questionnaire to allow this to be submitted for typesetting by February 2021; and

(v)     agrees that the membership of the working group be Mayor Barry, Deputy Mayor Lewis, Cr Edwards and Cr Hislop.”

For the reasons:

Having agreed to develop a thirty plan for the city, the 2021-31 Long-Term Plan process is Council’s first opportunity to begin setting the strategic direction and priorities for Lower Hutt. It is an opportunity to consider global trends and local implications, and to develop our thinking about the kind of city we should be.

Agreeing the direction and priorities will help inform Council’s engagement with citizens on the LTP and its thirty year plan.

 

ii)

Long Term Plan 2021-2031, Financial aspects (20/988)

 

Mr Philip Jones from PJ & Associates was in attendance for the item.

The Chief Financial Officer elaborated on the report.

In response to a question from a member, the Head of Parks and Recreation advised that the first three weeks of the summer pool openings attracted approximately 1,000 patrons to each outdoor pool.  He noted that the Wainuiomata Pool reached figures between 1,500 and 2,000.  He confirmed it was these first three weeks of opening that were proposed to be discontinued.

In response to a question from a member regarding Council’s credit rating, the Chief Financial Officer advised officers were not proposing any action that would compromise the current credit rating level.

In response to a question from a member regarding the funding for the Naenae Pool, the Chief Financial Officer advised the $54M capital cost included the central government ‘Shovel Ready’ grant of $27M.  She added the $54M cost was still being finalised. 

In response to questions from members regarding the Akatawara Cemetery, the Strategic Advisor advised the capital cost of any developments was split 75/25 between Council and Upper Hutt City Council (UHCC).  He said this was based on the number of interments from each local authority area.  He confirmed that UHCC had agreed to pay their 25% share and covered all operational costs.

In response to questions from a member regarding the results of the Productivity Commission’s report, the Chief Financial Officer acknowledged the findings of the report.  She said a number of the recommendations contained in the report were not relevant as it had not been written specifically for Council. She added that it was a source of information that officers had referred to when drafting the report.  Mr Jones advised many of the recommendations of the Productivity Commission’s report required changes to be made to the Local Government Act and the Local Government (Rating) Act  in order for them to be implemented.  He explained the two acts were currently written on the basis of public good, rather than for user pays.  He stated that recent case law validated that rates were a form of tax on property values.

In response to questions from a member regarding how the 30% cap operated, Mr Jones advised it was a cap on uniform annual charges (fixed charges).

In response to a question from a member regarding the status of the Emergency Budget, the Chief Executive advised that items were permanently removed from the budget.  She said if items were to be reinstated that there would be cost implications.  She added that no removed items had led to unmanageable situations or implementation.

In response to questions from members, the Head of Parks and Recreation advised reductions in the parks and reserves budgets were for some provisional works and did not affect core maintenance operations.  The Chief Financial Officer advised the Eastern Bays Cycleway budget had been adjusted to align with the shovel ready funding and the altered timing of the project being brought forward.

The Chief Financial Officer advised the Homelessness Prevention budget would be carried over due to delays in implementation of the Homelessness Strategy.  She said there were no changes proposed to the amount of monies within the budget, other than the standard assumption that all budgets would be adjusted for inflation.  The Principal Policy and Research Advisor added that an increase in this budget may be required in the future.

The Chief Executive confirmed monies for major events were removed from the budget and that it was a decision of Council as to whether any monies were reinstated.  She added that such action would result in a rates rise.

Cr Dyer expressed concern that the monies removed from the Emergency Budget could not be reinstated without implications.

Cr Brown supported the officer’s recommendations.  She added that she anticipated the budget and implementation for the Homelessness Strategy would need to be increased as the problem was growing at an exponential rate.

Cr Edwards expressed concern that the Three Waters requirements might add substantial amounts to the budget.

 

 

RECOMMENDED:    (Mayor Barry/Cr Brown)         Minute No. LTPAP 20503

“That the Subcommittee recommends that Council:

(i)        agrees the high level plan as detailed in table 2 outlined in the officer’s report;

(ii)       endorses the proposed Financial Strategy principles to be included in the Draft Long Term Plan 2021-2031;

(iii)      agrees the proposed changes to the Long Term Plan activity structure as detailed in Section D of the officer’s report;

(iv)      agrees the proposed Long Term Plan revenue assumptions as detailed in the Section E of the officer’s report;

(v)       agrees the proposed Long Term Plan operating and capital expenditure assumptions as detailed in Section F of the officer’s report;

(vi)      agrees the proposed change to the debt to revenue limit to be included in the Long Term Plan, as detailed in the officer’s report in table 8; and

(vii)     endorses the budget matters as detailed in table 9 of the officer’s report in the preparation of the Draft Long Term Plan 2021-2031.”

 

iii)

Revenue and Financing Policy review (20/863)

 

Mr Philip Jones from PJ & Associates was in attendance for the item.

The Chief Financial Officer elaborated on the report.

The Manager, Financial Strategy and Planning advised key adjustments included: proposing to increase fees for building and resource consents to recover 80%-100% of costs and proposing to increase animal control fees to cover 60%-80% of costs.  He added that changes were proposed to the rural rating system so that definitions would be aligned with those contained within the Lower Hutt District Plan. 

The Manager, Financial Strategy and Planning outlined the advantages and disadvantages of each rates differential system proposed (differential multiplier and fixed percentage).  He added the fixed percentage approach could be confusing for ratepayers as the amount of rates changed each year. 

The Financial Transaction Services Manager explained that Council was the only local authority in the region to have six rate instalment cycles.  She added that most local authorities used quarterly rate instalment cycles.  She outlined the advantages and disadvantages of reducing the number of instalments.  She said that a thorough education programme would be required if the number of rate instalments was reduced.

In response to questions from members, the Financial Transaction Services Manager advised monthly direct debit arrangements would continue if the instalment cycle was changed.  She explained that current legislation prevented postage charges being added onto the rates invoices that were posted.  She added that incentives could be offered for those ratepayers opting to receive their invoice via electronic mail.  She confirmed any changes could be rolled in over a two year period and that the rates invoice would need to be redesigned.

In response to further questions from members, the Financial Transaction Services Manager confirmed the rates rebate would still be available if the rates instalment cycle was altered.  She highlighted that the estimated $44,000 in printing savings was an annual saving.

In response to questions from a member, Mr Jones advised that detailed analysis would occur over the next month, based on the direction provided by members. He said this would include further details on the rates differential and multiplier effect options and would be reported to the 27 October 2020 meeting.  He confirmed that a percentage allocation of rates would provide flexibility in the system.  He said if the overall number of businesses reduced, the remaining businesses would experience a rates increase. 

In response to further questions from members, Mr Jones advised that the assumptions and rating sytems should be reviewed every three years, in line with the Long Term Plan (LTP) cycle.  He explained that a fixed percentage option could level out any drastic rate increases due to revaluations however, would not eliminate them.  He confirmed that the current process was a complete review of the rating system.

In response to a question from a member regarding the alignment of the revaluations cycle and the LTP cycle, the Financial Transaction Services Manager advised it was possible to align the two cycles.  She said it would require an additional revaluation cycle as they were legally required every three years.  The Chief Financial Officer advised this matter would be reported back at a future meeting.

In response to members’ questions, the Manager, Financial Strategy and Planning confirmed the Transition Policy would allow changes to be made to the rural rating system.  Mr Jones reiterated that details would be provided for all options to better understand how proposed changes could affect different types of properties.

In response to a question from a member, the Chief Executive advised building and resource consent fees were already charged at a percentage allocation.  She noted that any changes would be in line with the proposed new Policy Framework.

 

 

RECOMMENDED:    (Mayor Barry/Cr Edwards)   Minute No. LTPAP 20504

“That the Subcommittee recommends that Council:

(i)        notes that as part of the preparation of Draft Long Term Plan 2021-2031, that the Revenue and Financing Policy is being reviewed;

(ii)       endorses the proposed approach to the review of the Revenue and Financing Policy as detailed in Section C contained in the officer’s report;

(iii)      endorses the proposed ‘Funding Needs Analysis’ section of the Revenue and Finance Policy section, attached as Appendix 1 to the report;   

(iv)      notes this ‘Funding Needs Analysis’ will underpin further work to be undertaken in relation to setting fees, rates and other funding sources for the Long Term Plan 2021-2031 and in future years; and

(v)       notes the work completed to date on updates to the Revenue and Finance Policy.”

The meeting adjourned at 3.36pm and resumed at 3.50pm.

iv)

Rating Policy Review (20/989)

 

Mr Philip Jones from PJ & Associates was in attendance for the item.

In response to questions from members, Mr Jones advised there was little Council could do to address affordability of rates as rates were based on gross wealth and not the ability to pay.   He said if a large proportion of rates were a fixed fee, this could help to minimise the impact of significant revaluation increases.  He added that fixed fees disadvantaged many.  He further advised that there was no legal mechanism whereby the properties experiencing small rates rises had their rates amount increased to effectively subsidise those properties experiencing significant rate increases.  He added such a system would require each individual property to have a differential rate.

In response to further questions from members, Mr Jones advised the current rates differential system resulted in the residential group paying proportionately more in rates than in 2010.

In response to questions from a member, the Manager, Financial Strategy and Planning advised any proposed changes to the rating system would need to go through consultation.  He added that targeted consultation would also be undertaken especially with regards to rural properties.  The Chief Financial Officer added that transitional changes could also be proposed.  The Manager, Financial Strategy and Planning highlighted the map contained in Attachment 5 of the report.  He said there was a mix of privately owned rural properties and ones owned by Greater Wellington Regional Council.  He further added that officers were working with the District Plan review team with regards to any proposed changes to zonings.

Mayor Barry foreshadowed his intention to move four new recommendations to replace recommendations (x)-(xi) outlined in the officer’s report.  He confirmed the new recommendation (xi) percentages were in addition to the existing 62% and 63% investigations.

Cr Mitchell requested that officers provide reasons for a preferred option at the next meeting.  Mayor Barry reminded members the system would be reviewed every three years, and that there was no expectation officers would be providing detailed analysis of every option.                                                                                                          

 

 

Cr Milne expressed concern that there was not sufficient information to fully understand all the implications of a percentage rates methodology.  Mayor Barry advised that the discussion by members would provide officers with a directional steer and was not a final decision.

Cr Dyer and Cr Edwards expressed concern with a reduction in rates instalment frequency, adding that they would prefer incentives to move ratepayers to online methods of payment.  The Chief Financial Officer confirmed that public feedback would be sought on reducing the frequency of instalments.

Cr Briggs expressed support for the recommendations.

The Chief Financial Officer advised the frequency of rates instalments could be revisited at a later date.  She said mechanisms to encourage ratepayers to opt into the direct debit and electronic invoicing options would be investigated in the meantime.

Cr Mitchell reminded members that the total amount of rates to be paid would remain the same, regardless of the frequency of invoicing.  He supported a percentage of rates methodology as it helped to level out rates increases due to revaluations.

Cr Dyer requested that more options be explored, including universal annual charges and more targeted rates.

Members discussed the removal of recommendations (xii) and (xiii) in the officer’s report relating to the frequency of the rates instalments per annum.

Mayor Barry thanked officers and Mr Jones for their work on this matter.

 

 

RECOMMENDED:  (Mayor Barry/Cr Edwards)     Minute No. LTPAP 20505

“That the Subcommittee recommends that Council:

(i)        notes that rates affordability is a key consideration in the Council’s Financial Strategy, as detailed in Section A contained in the report;

(ii)       notes that in approving the rating policy in the Annual Plan 2020/21, Council agreed to a rates policy review being undertaken from a first principles approach, as part of the Long Term Plan (LTP) 2021-2031;

(iii)      notes that the rates policy will be consulted on a part of the Draft LTP 2021-2031 process, with relevant details included in the Revenue and Financing Policy and the Rates Funding Impact Statement;

(iv)      notes the overall approach to the rating review as outlined in Section C contained in the report;

(v)       agrees that there is to be no change to Council continuing to set general rates based on the capital value of properties, refer Section E contained in the report;

(vi)      agrees that there is no change to targeted rates, apart from those changes relating to refuse and recycling, refer Section F contained in the report;

(vii)     agrees that a Uniform Annual General Charge is not implemented, refer Section G contained in the report; 

(viii)    agrees in principle that the Community Facilities differentials and related rates remission policy continue unchanged, refer Section H contained in the report; 

(ix)      agrees in principle to progressing changes to rural rates to align with the District Plan rural activity description, refer Section I contained in the report;

(x)       having considered the method of setting general rates differentials as contained in Section J of the report, directs officers to further develop options to support its preferred option of using a percentage of rates methodology, as compared with a multiplier methodology;

(xi)      requests officers to develop options which would see the residential share of rates at 60%, 58% and 56%, with options around staging any changes over time;

(xii)     having considered the options to change general rates differentials as contained in Section K of the report, requests officers to further develop options of merging differentials for Business Central and Business Queensgate;

(xiii)    having considered the options to change general rates differentials as contained in Section K of the report, requests officers to further develop options of removing the differential for Business accommodation, by merging into either Business Suburban or Business Central depending on location; and

 (xiv)   notes that officers will report back to the Subcommittee on
27 October 2020 with further analysis and advice in relation to rating policy review.”

 

v)

Development Contributions Policy Review (20/909)

 

Mr Philip Jones from PJ & Associates was in attendance for the item.

The Head of Strategy and Planning elaborated on the report.  She explained that development contributions were a funding tool available under the Local Government Act to assist with growth and infrastructure. 

In response to questions from members, the Head of Strategy and Planning confirmed that projects which had qualified for the Development Package and had yet to take it up, were still able to use the incentive.  The Chief Financial Officer advised there was no time limit on those qualifying projects to use the incentive.  

In response to a question from a member regarding what development contributions could be used for, the Chief Financial Officer explained it was a complicated system of allocation, and that monies could not be allocated to reserves.  She added if roads were included in a development then monies could be used to assist in the maintenance of these.  She advised detailed plans of each development were required and that this was an area officers were looking at improving to ensure robust information was provided with each development application. 

The Director Environment and Sustainability advised the Resource Management Act provided for reserves fund contributions to be taken for each qualifying development.

In response to questions from a member regarding possible targeting of a development contribution to a specific geographical area, the Chief Financial Officer advised the contributions were linked to a catchment.  She added all infrastructural costs for a specific catchment were totalled and divided up amongst the known developments within the catchment.  The Head of Strategy and Planning added that development contributions could be taken to pay for infrastructure that was generated by a new development.  She further added that incentives to use water sensitive designs, for example, could be discussed at the initial stages of a development.

In response to questions from a member regarding how development contributions were paid, the Head of Strategy and Planning advised that the contribution was charged and paid for prior to consent being issued.  Mr Jones advised the Special Purpose Vehicle provisions applied to developments in excess of 200 lots, and provided for Council to levy each lot for a portion of the total development contribution. 

 

 

RECOMMENDED:    (Mayor Barry/Cr Mitchell)    Minute No. LTPAP 20506

“That the Subcommittee recommends that Council:

(i)      notes that Wellington Water Limited has indicated that significant investment is required to support forecast growth in Lower Hutt;

(ii)     notes that economic incentive remissions package for development contributions have ceased and that consequently, all new developments now pay full development contribution charges;

(iii)    agrees in principle to:

a.    expand growth planning and capacity life horizons for the Development Contributions Policy to 30 years;

b.    retain the scope of activities funded by development contributions – water, wastewater, transport, and stormwater;

c.     retain a policy where 100% of the capital cost of providing growth related infrastructure for water, wastewater, transport, and stormwater are funded by development contributions; and

d.    introduce differentiated development contribution assessment rates for smaller residential units; and 

(iv)    agrees to update the Development Contributions Policy to be more user friendly and align it with best practice in the sector.”

 

vi)

Three Waters investment options for the 2021-31 Long Term Plan (20/1001)

 

Ms Julie Alexander (Group Manager Network Strategy and Planning),  Ms Nichola Chisnall (Principal Advisor Asset Strategy) and Ms Andrea McDonald (Acting Manager Service Planning) from Wellington Water Limited (WWL) were in attendance for this item.

The Strategic Advisor elaborated on the report.  He explained that officers recommended the mid option as it addressed the backlog in the network.  He stated that even if the water reforms resulted in water assets not being owned by Council, it was prudent to identify all issues with the networks. 

Cr Bassett said that it was likely that Council would be better recognised for the works undertaken now once the reform process was complete.

In response to questions from a member, the Strategic Advisor confirmed the report did not cover future water needs.  He added the officer’s report focused on reducing and restricting water use rather than investing in future infrastructure.

In response to questions from a member, the Chief Financial Officer advised further work was required to ensure any additional budget for water kept expenditure under the debt limit.  She added that indicative rate increases outlined in the officer’s report were averaged across both targeted and general rates.

In response to a question from a member regarding alternative options to water meters, the Strategic Advisor explained that research showed that water meters did immediately reduce water usage.  He said that if a reduction in water usage did not occur soon investment in another reservoir at Kaitoke would be required.  He added other monies had been allocated to investigating leakages, which could account for up to 20% of water usage.  The Group Manager Network Strategy and Planning, WWL further added that water demand was a system wide issue with many factors involved eg water meters, education, District Plan policies, improvements to networks and leakage detection and repair.  She noted that Greater Wellington Regional Council officers were currently working on a business case for water meters and the information would be available to Council shortly. 

Mayor Barry foreshadowed his intention to move an additional recommendation (vi) to ask officers to undertake work to specifically consider affordability of the required investment and measures which alleviate the immediate impact on ratepayers.

Cr Briggs expressed support for the recommendations.  He said this matter was a priority for the city, adding that if action did not occur now, the situation would be far worse in the future.

Cr Bassett expressed support for the recommendations.

Mayor Barry advised there was a “trifecta” of issues: growth, underinvestment in infrastructure and an aging infrastructure.  He thanked all involved for their work to date, which resulted in Council being fully informed of the situation.

 

 

recommended:    (Mayor Barry/Cr Briggs)       Minute No. LTPAP 20507

“That the Subcommittee recommends that Council:

(i)    notes that Wellington Water Limited (WWL) has provided Council with two investment options (represented as low and mid), to consider for possible inclusion in the Long Term Plan 2021-31;

(ii)   notes that both these options represent an overall increase in investment in both operational and capital expenditure to address identified key challenges, including;

            (a)        the timely renewal of ageing infrastructure;

            (b)        enabling growth;

            (c)        reducing water consumption;

            (d)        improving environmental water quality; and

            (e)        reducing carbon emissions;

(iii)  notes the information on the estimated rates impact of each option as detailed in paragraph 22 of the report;

(iv)  notes that government funding Council is expected to receive as part of the financial package being made available through the reform process will help to offset some of the short term costs associated with the proposed increase in 3 waters expenditure;

(v)   requests officers to work with WWL on preparing a modified mid option for further consideration; and

(vi)  requests officers to undertake work as part of the Long Term Plan to specifically consider affordability of required 3 waters investments, and measures and strategies which alleviate the immediate impact on ratepayers.”

5.             QUESTIONS   

There were no questions.

 

 

 

CLOSING FORMALITIES - Karakia WHAKAMUTUNGA

 

Whakataka te hau ki te uru

Whakataka te hau ki te tonga

Kia mākinakina ki uta

Kia mātaratara ki tai

E hī ake ana te atakura

He tio, he huka, he hau hū

Tīhei mauri ora.

Cease the winds from the west
Cease the winds from the south
Let the breeze blow over the land
Let the breeze blow over the ocean
Let the red-tipped dawn come with a sharpened air. 
A touch of frost, a promise of a glorious day.

 

 

 

There being no further business the Chair declared the meeting closed at  4.53pm.

 

 

C Barry

MAYOR

 

 

 

 

 

 

CONFIRMED as a true and correct record

Dated this 8th day of December 2020

 

 


                                                                                      24                                                     27 October 2020

Hutt City Council

15 October 2020

 

 

 

File: (20/1240)

 

 

 

 

Report no: HCC2020/6/225

 

Local Government Funding Agency - Annual General Meeting

 

Purpose of Report

1.    To confirm an agreed approach in regards to the Local Government Funding Agency (LGFA) Annual General Meeting (AGM) in regards to:

(a)  the two vacant LGFA director positions; and

(b)  the two vacant LGFA Shareholders’ Council positions

(c)  proposed changes to the LGFA Foundation Policies.

Recommendations

That Council:

(i)    notes that the upcoming Annual General Meeting (AGM) for Local Government Funding Agency (LGFA) is scheduled to take place on 19 November 2020;

(ii)   notes that the LGFA Shareholders’ Council recommends that Philip Cory-Wright and Mike Timmer be re-elected as directors of LGFA, refer Appendix  1; and 

(iii)  directs officers to vote at the AGM in support of the re-election of Philip Cory-Wright and Mike Timmer as Directors of LGFA; and

(iv) directs officers to vote at the AGM in support of the re-election of Wellington City Council and Tasman District Council as Nominating Local Authorities on the Shareholders’ Council; and

(v)  directs officers to vote at the AGM supporting changes to the LGFA Foundation Policies.

 

Background

2.   Hutt City Council is a minor shareholder in LGFA with a 0.4% shareholding.

3.   The 2020 AGM of LGFA is scheduled for Thursday 19 November 2020.  Nominations of candidates for the director positions and Shareholder Council positions closed on 18 September 2020.

LGFA Director Positions

4.   The LGFA Shareholders’ Agreement (the Agreement) requires the LGFA to be comprised of five independent directors and one non-independent director. The Agreement also requires one independent director and the non-independent director to retire by rotation each year.

5.   Philip Cory-Wright retires by rotation this year and has offered himself for re-election as an independent director.  Refer to Appendix 2 for biography information.

6.   Mike Timmer also retires by rotation and offers himself for re-election as the non-independent director. Refer to Appendix 4 for biography information. 

7.   Wayne Maxwell has been nominated by Kapiti Coast District Council for the non-independent director position. Refer to Appendix 3 for biography information.

8.   Both Philip Cory-Wright and Mike Timmer have the support of the LGFA Shareholders’ Council to continue as directors of LGFA (Refer Appendix 1).

LGFA Shareholders’ Council Positions

9.   The Shareholders’ Council comprises between five and 10 members with the current members being the Crown and nine Council members (Wellington City Council, Auckland Council, Bay of Plenty Regional Council, Christchurch City Council, Hamilton City Council, Tasman District Council, Tauranga City Council, Western Bay of Plenty District Council and Whangarei District Council). 

10. The Shareholders’ Agreement requires the two Nominating Local Authority members (NLA) who have been in office the longest since election must retire by rotation. Tasman District Council and Wellington City Council will retire at the AGM and are seeking re-election.

11. New Plymouth District Council has notified LGFA that it wishes to seek election as a NLA to the Shareholders’ Council.

12. Whilst the Shareholder Council has abstained from making a recommendation in this regard, officers advice is that Tasman District Council continue in this role. (Refer Appendix 1).

Changes to LGFA Foundation Policies

13.  LGFA is proposing changes to the foundation policies (Refer Appendix 2) in summary:

a.   an increase in the size of the liquid assets held on the LGFA balance sheet, requiring greater Treasury Policy limits; and

b.   removing a limit on a council’s loans maturing in a rolling 12-month period.

 

14. The Shareholders Council supports the changes to the foundation policies (Refer Appendix 1).

 

Legal Considerations

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

Financial Considerations

16. The financial considerations are detailed in this report in the relevant areas.

Appendices

No.

Title

Page

1

Appendix 1: LGFA Shareholders' Council letter in relation to the AGM

27

2

Appendix 2: Notice of LGFA Annual General Meeting

30

3

Appendix 3: Wayne Maxwell Biography

36

4

Appendix 4: Mike Timmer Biography

37

     

 

 

 

 

 

Author: Glenn Phillips

Treasury Officer

 

 

 

 

 

 

Reviewed By: Jenny Livschitz

Chief Financial Officer

 

 

 

Approved By: Anna Welanyk

Director Transformation and Resources

 


Attachment 1

Appendix 1: LGFA Shareholders' Council letter in relation to the AGM

 

14 October 2020

 

 

The Shareholders

NZ Local Government Funding Agency

 

 

Dear Shareholder

You have recently received papers from the LGFA for its Annual General Meeting (AGM) on 19 November 2020. The Shareholders’ Council has considered this material and wishes to make recommendations to help with your decision making prior to the AGM.

Our role (as per the Shareholders’ Agreement) includes requirements to:

·    Make recommendations to Shareholders as to the appointment removal, re-election, replacement and remuneration of Directors.

·    Make recommendations to Shareholders as to any matters which require the approval of Shareholders.

Our recommendations on the AGM resolutions are as follows:

Resolution 1 – Financials

The financial statements and Auditor’s report for the company for the year ended 30 June 2020 will be presented for consideration and discussion.

The Shareholders/ Council recommends this resolution is approved.

Resolution 2 – Appointment of Directors

Earlier this year the Shareholders’ Council met to consider Board representation. At that time we formed the view that there was no pressing need to change the Board composition and we would therefore support the re-appointment of the incumbent retiring directors.

 

This support was conditional upon:

·   a review being conducted in 2020/21 of the current Board’s performance

·   determining the skills and experience needed going forward

·   an assessment of the incumbent Board against this matrix

·   a review of succession planning for the Board Chair and Audit & Risk Chair roles.

 

As a result of this decision the Shareholders’ Council did not actively seek additional nominations for the Director roles.

 

However, a nomination was subsequently received from Kapiti Coast District Council for the appointment of their CEO, Wayne Mawell, as a Non-Independent Director. The incumbent Non-Independent Director, Mike Timmer, is seeking re-election, meaning this position is contested.

 

Philip Cory-Wright, as the retiring Independent Director, seeks re-election, with no other nominees for this position.

 

Yesterday the Shareholders’ Council interviewed the two nominees for the Non-Independent Director role. The unanimous view of those members present was that Mike Timmer should be re-appointed as:

 

·   Given the uncertainty and volatility in financial markets forecast over the next year, there was a strong case for Board continuity

·   He has been a strong perfomer within a highly competent Board

·   He was able to demonstrate an awareness of issues facing all stakeholders i.e shareholders, guarantors, borrowers and investors

 

While Wayne also has strong credentials and offers a fresh perspective, it was felt that any new appointments should only be made after completing the review of the required composition and skills outlined above.

The Shareholders’ Council recommends Philip Cory-Wright and Mike Timmer are re-elected.

Resolution 3 – Election of Nominating Local Authorities

This issue is not specified as being within the role of the Shareholders’ Council, and while it falls within “matters which require the approval of Shareholders” we feel there is conflict of interest and it would be inappropriate to make a recommendation as two of the three candidates are already Shareholders’ Council members.

Shareholders are therefore requested to make their own determination on this matter.

The Shareholders/ Council abstains from making a recommendation on this matter.

Resolution 4 – Changes to Foundation Policies

The proposed changes have been discussed in depth with LGFA management, and we agree that they are sensible adjustments that reflect the ongoing development and maturity of the company and in particular the changing nature of the lending portfolio.

In supporting the changes, we have requested LGFA complete a comprehensive review of the Treasury Policy within the next twelve months and continue to monitor relevant borrowing parameters, regardless of whether they are specified covenants.

The Shareholders/ Council supports the changes to the foundation policies.

I trust you find this information helpful. Please contact me or your Shareholders’ Council liaison should you wish to discuss any matter relating to this letter or any other aspects of LGFA operations.



Yours sincerely

 

Alan Adcock

Chair, LGFA Shareholders' Council

cc. Mark Butcher, Chief Executive LGFA

 

 


Attachment 2

Appendix 2: Notice of LGFA Annual General Meeting

 


 


 


 


 


 


Attachment 3

Appendix 3: Wayne Maxwell Biography

 


Attachment 4

Appendix 4: Mike Timmer Biography