Agenda of Infrastructure Committee

Item 9: Nelson Regional Sewerage Business Unit 2022/23 Business Plan

Infrastructure Committee

18 November 2021

REPORT R26207

Nelson Regional Sewerage Business Unit 2022/23 Business Plan

1. Purpose of Report

1.1 To receive, consider and provide feedback on the Draft 2022/23 Nelson Regional Sewerage Business Unit (NRSBU) Business Plan (Plan) to the NRSBU General Manager.

2. Recommendation

That the Infrastructure Committee

1. Receives the report Nelson Regional Sewerage Business Unit 2022/23 Business Plan (R26207) and its attachment (A2728794); and

2. Provides feedback to the Nelson Regional Sewerage Business Unit via the General Manager of the Nelson Regional Sewerage Business Unit on the draft Nelson Regional Sewerage Unit 2022/23 Business Plan (A2728794)

3. Background

3.1 The NRSBU was established by the Nelson City Council (NCC) and Tasman District Council (TDC) in July 2000. Its purpose is to manage and operate the wastewater treatment facilities at Bell Island and the associated reticulation network efficiently and in accordance with resource consent conditions and to meet the needs of its customers.

3.2 The five major customers are NCC, TDC, Turners and Growers, Alliance, and Nelson Pine Industries.

3.3 The Memorandum of Understanding requires that the Draft Business Plan be presented annually to each Council by 31 December each year and allows for each Council to provide feedback on the draft Business Plan.

3.4 The draft 2022/23 Business Plan has been prepared by the General Manager and was presented to the Board, who resolved on 17 September 2021 as follows:

Approves the Draft Nelson Regional Sewerage Business Unit Business Plan (A2728794) for submission to Nelson City Council and Tasman District Council for their consideration and feedback.

Recommendation to Nelson City Council and Tasman District Council

That the Nelson City Council and Tasman District Councils

Receive the Draft Nelson Regional Sewerage Business Unit Business Unit Plan 2022-2023 (A2728794) for review and provide feedback to the Nelson Regional Sewerage Business Unit if required.

3.6 The NRSBU can only formally adopt the Draft Plan after receiving and considering comment from the two Councils and is then required to present the final Business Plan to the Councils by 20 March.

4. Discussion

4.1 The Draft Business Plan is appended as Attachment 1 and the General Manager will be present at the meeting to answer any questions.

4.2 The Draft Plan varies very little compared to the programme and budgets outlined in the approved NRSBU AMP and in Council’s Long-Term Plan (LTP). There are therefore no implications to the NCC budget.

4.3 The Draft Plan for 2022/23 includes capital expenditure required to implement several improvements to the capacity of the regional pumping and pipework network. The plan includes features to allow improved maintenance, and resilience to avoid overflows from the network that could contaminate the Waimea Estuary. Key aspects of this Draft Plan include:

4.3.1 A new Biosolids Application Operations and Maintenance (O&M) contract.

4.3.2 A new Bell Island O&M contract.

4.3.3 Additional revenue associated with the increased recoveries from the septage facilities and irrigation of Bell and Best Island.

5. Options

5.1 The Committee has the option to provide feedback to the NRSBU on the draft Plan. Council officers have no comment as the Business Plan is in line with the recently adopted AMP and LTP.

6. Conclusion

6.1 The NRSBU Draft 2022/23 Business Plan has been approved by the NRSBU Board and released to the two Councils for comment.

7. Next Steps

7.1 The NRSBU Board will consider the comments from both NCC and TDC and refer the Business Plan back to the Council’s for consideration.

Author: Alec Louverdis, Group Manager Infrastructure

Attachments

Attachment 1: A2728794 - NRSBU Business Plan 2022-2023 ⇩

Important considerations for decision making

1. Fit with Purpose of Local Government

The NRSBU is a joint committee constituted pursuant to the provisions of Schedule 7 to the Local Government Act 2002. A regional sewerage unit contributes to the following Local Government well-beings of social, economic, environmental, and cultural.

2. Consistency with Community Outcomes and Council Policy

The Plan supports the delivery of the following Council Community Outcomes:

• Our infrastructure is efficient, cost effective and meets current and future needs

• Our communities are healthy, safe, inclusive, and resilient

3. Risk

This report allows Council to comment on the NRSBU Business Plan and these comments will be considered by Board. The risk of not approving the Business Plan is that this could delay the NRSBU implementing its Business Plan for 2022/23.

4. Financial impact

The NRSBU 2022/23 Business Plan is in line with the NRSBU approved AMP and NCC’S LTP.

5. Degree of significance and level of engagement

The NRSBU is a Joint Committee of the two Councils and its activities are included in the Long Term Plans and Annual Plans of each Council. Consultation is undertaken by both Councils in the preparation and adoption of these plans.

6. Climate Impact

A key feature of the draft NRSBU Business Plan is mitigating greenhouse gas emissions. These incudes and a commitment to measure and reduce greenhouse gas emissions from the facility.

7. Inclusion of Māori in the decision-making process

No engagement with iwi has been undertaken in preparing this report, but iwi have representation on the Board.

8. Delegations

The Infrastructure Committee has the following delegations to consider the Nelson Regional Sewerage Business Plan:

Areas of responsibility:

· Wastewater, including Bell Island Wastewater Treatment Plant

Delegations:

· Developing, monitoring, and reviewing strategies, policies, and plans, with final versions to be recommended to Council for approval

Item 10: Water Supply Activity Management Plan 2021-31

Infrastructure Committee

18 November 2021

REPORT R22591

Water Supply Activity Management Plan 2021-31

1. Purpose of Report

1.1 To adopt the Water Supply Activity Management Plan 2021-31 (AMP) following approval of the Long-Term Plan (LTP) in June 2021.

2. Recommendation

That the Infrastructure Committee

1. Receives the report Water Supply Activity Management Plan 2021-31 (R22591) and its attachment (A2757448).

Recommendation to Council

That the Council

1. Adopts the revised Water Supply Activity Management Plan 2021-31 (A2213226).

3. Background

3.1 Workshops were held with elected members (10 December 2019 and 20 August 2020 as part of the Infrastructure Strategy) to confirm priorities for the Draft AMP and on 19 November 2020 the Infrastructure Committee resolved as follows:

That the Infrastructure Committee:

Approves the Draft Water Supply Activity Management Plan 2021-31 (A2213226) as the version to inform the Long Term Plan 2021-31.

3.2 Council adopted the LTP on 24 June 2021 and the AMP has been amended to reflect those decisions. The process requires that the Council approve the revised AMP.

4. Discussion

4.1 The Executive Summary of the revised AMP is appended to this report as Attachment 1. Changes to this summary since the version brought to the committee in November 2020 are highlighted in yellow.

4.2 The revised AMP (A2213226) is over 200 pages long and has been updated on the Council’s website, 2021-31 Activity Management Plans page (www.nelson.govt.nz/2021-31-activity-management-plans) and was also circulated to all Councillors with a hard copy placed in the Councillor’s lounge on 14 October 2021.

Changes made through Long Term Plan deliberations

4.3 The AMP was not materially affected by any changes to the adopted LTP. The most significant changes were updates to the work programme in the Draft AMP that was approved by the Infrastructure Committee in November 2020.

4.3.1 The Water Supply work programme and budgets as approved by Council on 24 June 2021 following deliberations on the LTP have been included.

4.3.2 The principal changes to the work programme and budget in the Draft AMP have included: Bringing forward water supply projects for some growth areas and deferring the original proposed increase in renewal expenditure in years 9 and 10 in order to better align the projects with other future growth areas.

5. Options

5.1 Two options are presented. Adopt the AMP or not adopt the AMP. Officers recommend option 1.

Option 1: Adopt the Water Supply AMP (Recommended option)
Advantages	· Supports Council to meet requirements under section 93 and Schedule 10 of the Local Government Act 2002 (LGA) · Supports delivery of the recently adopted LTP 2021-31
Risks and Disadvantages	· Nil
Option 2: Do not adopt the Water Supply AMP
Advantages	· Nil
Risks and Disadvantages	· Not adopting the AMP would leave Council without a clear plan to mitigate risks and achieve levels of service.

6. Conclusion

6.1 The draft Water Supply AMP 2021-31 has been reviewed following the adoption of the LTP and now needs to be adopted.

Author: Phil Ruffell, Activity Engineer - Water Supply and Stormwater

Attachments

Attachment 1: A2757448 - Draft Water Supply Activity Management Plan 2021-31 Executive Summary ⇩

Important considerations for decision making

1. Fit with Purpose of Local Government

The AMP supports the social, economic, and environmental wellbeing of the Nelson community by putting in place the planning for good quality local infrastructure that is efficient, effective, and appropriate to present and anticipated future circumstances as defined under the Local Government Act 2002.

2. Consistency with Community Outcomes and Council Policy

The AMP has been developed to support delivery of the following Council Community Outcomes

· Our infrastructure is efficient, cost effective, and meets current and future needs

· Our communities are healthy, safe, inclusive, and resilient

· Our unique natural environment is healthy and protected.

· Our urban and rural environments are people friendly, well planned and sustainably managed.

3. Risk

Adopting the AMP is a low risk as it has been through a thorough development process and reflects all the relevant LTP decisions. Adopting this AMP helps Council mitigate risks by: Providing a clear plan to achieve levels of service, address relevant focus areas and set activity budgets for operations, maintenance, and capital expenditure for renewals, growth, and level of service upgrades.

4. Financial impact

There are no direct funding implications from the recommendation. This AMP reflects the decisions made by Council on the 24^th June 2021 when it adopted the LTP which sets out budgets for both operational and capital expenditure.

5. Degree of significance and level of engagement

This matter is of low significance because decisions arising from the AMP which were considered to be significant were consulted on through the LTP.

6. Climate Impact

The AMP has been developed giving consideration to the potential impacts and risks climate change presents to the City. Examples of proposed adaptation, mitigation and leadership actions are demonstrated throughout the document, which also includes a specific section on climate change.

7. Inclusion of Māori in the decision-making process

No engagement with Māori has been undertaken in preparing this report. Consultation with Māori occurred via an iwi workshop as part of the development of the draft for LTP.

8. Delegations

The Infrastructure Committee has the power to

· Develop and approve draft Activity Management Plans in principle, including the Infrastructure Strategy, for inclusion in the draft Long Term Plan

Areas of Responsibility:

· Water

The Infrastructure Committee has the following power to recommend to Council:

· Approval of final versions of strategies, policies, and plans

Item 11: Wastewater Activity Management Plan 2021-31

Infrastructure Committee

18 November 2021

REPORT R22598

Wastewater Activity Management Plan 2021-31

1. Purpose of Report

1.1 To adopt the Wastewater Activity Management Plan 2021-31 (AMP) following approval of the Long-Term Plan (LTP) in June 2021.

2. Recommendation

That the Infrastructure Committee

1. Receives the report Wastewater Activity Management Plan 2021-31 (R22598) and its attachment (A2756636)

Recommendation to Council

That the Council

1. Adopts the revised Wastewater Activity Management Plan 2021-31 (A2758059).

3. Background

3.1 Workshops were held with elected members (3 March 2020 and 20 August 2020 as part of the Infrastructure Strategy) to confirm priorities for the Draft AMP and on 19 November 2020 the Infrastructure Committee resolved as follows:

That the Infrastructure Committee:

Approves the Draft 2021-31 Wastewater Activity Management Plan (A2424421) as the version to inform the Long Term Plan 2021-31.

3.2 Council adopted the LTP on 24 June 2021 and the AMP has been amended to reflect those decisions. The process requires that the Council approve the revised AMP.

4. Discussion

4.1 The Executive Summary of the revised AMP is appended to this report as Attachment 1. Changes to this summary since the version brought to the committee in November 2020 are highlighted in yellow.

4.2 The revised AMP (A2758059) is over 200 pages long and has been updated on the Council’s website, 2021-31 Activity Management Plans page (www.nelson.govt.nz/2021-31-activity-management-plans) and was also circulated to all Councillors with a hard copy placed in the Councillor’s lounge on 14 October 2021.

Changes made through Long Term Plan deliberations

4.4 The Wastewater work programme and budgets as approved by Council on 24 June 2021 following deliberations on the LTP have been included.

5. Options

5.1 Two options are presented. Adopt the AMP or not adopt the AMP. Officers recommend option 1.

Option 1: Adopt the Wastewater AMP (Recommended option)
Advantages	· Supports Council to meet requirements under section 93 and Schedule 10 of the Local Government Act 2002 (LGA) · Supports delivery of the recently adopted LTP 2021-31
Risks and Disadvantages	· Nil
Option 2: Do not adopt the Wastewater AMP
Advantages	· Nil
Risks and Disadvantages	· Not adopting the AMP would leave Council without a clear plan to mitigate risks and achieve levels of service.

6. Conclusion

6.1 The draft Wastewater AMP 2021-31 has been reviewed following the adoption of the LTP and now needs to be adopted.

Author: Warren Biggs, Activity Engineer - Wastewater

Attachments

Attachment 1: A2756636 - Draft Wastewater Activity Management Plan 2021-31 Executive Summary ⇩

Important considerations for decision making

1. Fit with Purpose of Local Government

2. Consistency with Community Outcomes and Council Policy

The AMP has been developed to support delivery of the following Council Community Outcomes:

· Our infrastructure is efficient, cost effective, and meets current and future needs

· Our communities are healthy, safe, inclusive and resilient

· Our unique natural environment is healthy and protected.

· Our urban and rural environments are people friendly, well planned and sustainably managed

3. Risk

Adopting the AMP is a low risk as it has been through a thorough development process and reflects all of the relevant LTP decisions. Adopting this AMP helps Council mitigate risks by: Providing a clear plan to achieve levels of service, address relevant focus areas and set activity budgets for operations, maintenance, and capital expenditure for renewals, growth and level of service upgrades.

4. Financial impact

5. Degree of significance and level of engagement

This matter is of low significance because decisions arising from the AMP which were considered to be significant were consulted on through the LTP.

6. Climate Impact

The AMP has been developed giving consideration to the potential impacts and risks climate change presents to the city. Examples of proposed adaptation, mitigation and leadership actions are demonstrated throughout the document, which also includes a specific section on climate change.

7. Inclusion of Māori in the decision making process

No engagement with Māori has been undertaken in preparing this report. Consultation with Māori occurred as part of the development of the draft for LTP.

8. Delegations

The Infrastructure Committee has the power to:

· Develop and approve draft Activity Management Plans in principle, including the Infrastructure Strategy, for inclusion in the draft Long Term Plan

Areas of Responsibility:

· Wastewater

The Infrastructure Committee has the following power to recommend to Council:

· Approval of final versions of strategies, policies and plans

Item 12: Stormwater and Flood Protection Activity Management Plan 2021-31

Infrastructure Committee

18 November 2021

REPORT R22601

Stormwater and Flood Protection Activity Management Plan 2021-31

1. Purpose of Report

1.1 To adopt the Stormwater and Flood Protection Activity Management Plan 2021–31 (AMP) following approval of the Long-Term Plan (LTP) in June 2021.

2. Recommendation

That the Infrastructure Committee

1. Receives the report Stormwater and Flood Protection Activity Management Plan 2021-31 (R22601) and its attachment (A2755575).

Recommendation to Council

That the Council

1. Adopts the revised Stormwater and Flood Protection Activity Management Plan 2021–31 (A2755586).

3. Background

3.1 Workshops were held with elected members (3 March 2020 and 20 August 2020 as part of the Infrastructure Strategy) to confirm priorities for the Draft AMP and on 1 October 2020 the Infrastructure Committee resolved as follows:

That the Infrastructure Committee:

Approves the Draft Stormwater and Flood Protection Activity Management Plan 2021-31 (A2427836) as the version to inform the Long Term Plan 2021-31.

3.2 Council adopted the LTP on 24 June 2021 and the AMP has been amended to reflect those decisions. The process requires that the Council approve the revised AMP.

4. Discussion

4.1 The Executive Summary of the revised AMP is appended to this report as Attachment 1. Changes to this summary since the version brought to the committee in October 2020 are highlighted in yellow.

4.2 The revised AMP (A2755586) is over 200 pages long and has been updated on the Council’s website, 2021-31 Activity Management Plans page (www.nelson.govt.nz/2021-31-activity-management-plans) and was also circulated to all Councillors with a hard copy placed in the Councillor’s lounge on 18 October 2021.

Changes made through Long Term Plan deliberations

4.3.1 The Stormwater and Flood Protection work programme and budgets as approved by Council on 24 June 2021 following deliberations on the LTP have been included.

4.3.2 The principal changes to the work programme and budget in the Draft AMP have included: Bringing forward stormwater projects, including Airlie Street and Washington Valley, the addition of the Haven Rd Stormwater upgrade, and additional budget for Rutherford Stage 1 Stormwater upgrade and Saxton Creek Stage 4 Flood Protection upgrade.

5. Options

5.1 Two options are presented. Adopt the AMP or not adopt the AMP. Officers recommend option 1.

Option 1: Adopt the Stormwater and Flood Protection AMP (Recommended option)
Advantages	· Supports Council to meet requirements under section 93 and Schedule 10 of the Local Government Act 2002 (LGA) · Supports delivery of the recently adopted LTP 2021-31
Risks and Disadvantages	· Nil
Option 2: Do not adopt the Stormwater and Flood Protection AMP
Advantages	· Nil
Risks and Disadvantages	· Not adopting the AMP would leave Council without a clear plan to mitigate risks and achieve levels of service.

6. Conclusion

6.1 The draft Stormwater and Flood Protection AMP 2021-31 has been reviewed following the adoption of the LTP and now needs to be adopted.

Author: Toby Kay, Activity Engineer

Attachments

Attachment 1: A2755575 - Draft Stormwater and Flood Protection Activity Management Plan 2021-31 Executive Summary ⇩

Important considerations for decision making

1. Fit with Purpose of Local Government

2. Consistency with Community Outcomes and Council Policy

The AMP has been developed to support delivery of the following Council Community Outcomes:

· Our infrastructure is efficient, cost effective, and meets current and future needs

· Our communities are healthy, safe, inclusive and resilient

· Our unique natural environment is healthy and protected.

· Our urban and rural environments are people friendly, well planned and sustainably managed

3. Risk

4. Financial impact

5. Degree of significance and level of engagement

This matter is of low significance because decisions arising from the AMP which were considered to be significant were consulted on through the LTP.

6. Climate Impact

7. Inclusion of Māori in the decision making process

No engagement with Māori has been undertaken in preparing this report. Consultation with Māori occurred via an iwi workshop as part of the development of the draft for LTP.

8. Delegations

The Infrastructure Committee has the power to:

· Develop and approve draft Activity Management Plans in principle, including the Infrastructure Strategy, for inclusion in the draft Long Term Plan

Areas of Responsibility:

· Stormwater and Flood protection

The Infrastructure Committee has the following power to recommend to Council:

· Approval of final versions of strategies, policies and plans

Item 13: Infrastructure Quarterly Report

Infrastructure Committee

18 November 2021

REPORT R26267

Infrastructure Quarterly Report

1. Purpose of Report

1.1 To inform the Committee of the financial and non-financial results for the first quarter of 2021/2022 for the activities under its delegated authority.

2. Recommendation

That the Infrastructure Committee

1. Receives the report Infrastructure Quarterly Report (R26267) and its attachments (A2775741 and A2774733).

3. Background

3.1 Quarterly reports on performance are being provided to each Committee on the performance and delivery of projects and activities within their areas of responsibility.

3.2 The financial reporting focuses on the year-to-date performance (1 July 2020 to 30 June 2021) compared with the year to date (YTD) approved capital and operating budgets.

3.3 Unless otherwise indicated, all information is against approved operating budget, which is the 2020/21 annual budget plus any carry forwards, plus or minus any other additions or changes as approved by the Committee or Council.

3.4 More detailed project status reports are included (attachments) for the 22 projects that fall under the Infrastructure Committee. These have been selected if their budget is at least $250,000 for 2021/22, are multi-year projects with a budget over $1Million or have been assessed to be of particular interest to the Committee. The Provincial Growth Fund (PGF) funded projects have also been added as will any other projects that will be receiving external funding.

3.5 Project status is analysed based on three factors: quality, time, and budget. From the consideration of these three factors the project is summarised as being on track (green), some issues/risks (orange), or major issues/risks (red). Projects that are within 5% of their budget are considered to be on track regarding the budget factor.

4. COVID-19 costs impacts

4.1 During this quarter approximately $300,000 in additional costs associated with the recent lockdowns for works that were in construction at the time we went back into lockdown have been identified. Once the claims have been confirmed and processed by officers, the additional costs could be offset from savings incurred on projects in the first instance (refer section 7).

4.2 Overseas and nationally sourced product delays continue, and the team have continued to explore early product purchases to mitigate potential start delays.

4.3 Based on the increasing product costs, we are expecting additional costs of between $600,000 and $1 million will be likely on those projects that have not secured their contractor or products at this time.

4.4 Officers are gathering information to assess the medium to longer term effects of COVID-19 on projects in Years 2 and 3 of the Long Term Plan and it is expected that this will be presented to Council in the new year.

4.5 Awatea Place Pump Station construction programme remains on track, however, this programme has had to be significantly changed to accommodate delays in material supplies and effects on sub-contractor availability, particularly those from the Auckland/North Island region. Furthermore, the material supply chain has been greatly affected and costs have increased between 5-20% since awarding of the contract. To manage the potential cost increase from COVID-19, Council is working with and has requested approval from the Department of Internal Affairs (DIA) for approximately $243,000 to be reallocated from within the Three Water Stimulus Funding Package to cater for this amount (refer to Section 9 of this report.

5. Tenders Awarded

5.1 Tenders above $300,000 awarded under delegated authority in the last quarter are listed below:

Project Name	Awarded to	Tender Price
Awatea Place Pump Station	Hunter Civil	$6,639,158
Haven Rd stormwater realignment	Donaldson Civil	$2,466,869
Saxton Creek Upgrade - Stage 4	Downer NZ	$15,672,204
Saxton Creek Upgrade - Stage 4	Coman Construction	$2,201,824
Saxton Creek Upgrade - Stage 4	Kernohan Engineering	$473,270
Airlie Street stormwater upgrade	Taylors Contracting	$1,036,599
Rocks Road watermain renewal	Fulton Hogan	$907,839

5.2 The Tenders Subcommittee approved the award of the following works.

Project Name	Awarded to	Tender Price
Washington Valley stormwater upgrade (Stage 1 - Hastings Street)	Tasman Civil	$4,188,816

6. Financial Results

Profit and Loss by Activity

Notes

1. The “Total Operating Budget” differs from the “Total Annual Plan Budget” in that it includes carry forwards and reallocations made after the final approval of the Annual Plan.

2. Base Expenditure is expenditure that happens year after year, for example yearly contracts or operating expenses.

3. Programmed Expenditure is planned work, or there is a specific programme of works. For example, painting a building.

4. Unprogrammed Expenditure is reactive or unplanned in nature, for example responding to a weather event. Budgets are included as provisions for these expenses which are unknown.

5. Some of the activities have a budgeted operating deficit. This is usually due to depreciation of those activities is not being fully funded by either rates or user fees within the LTP. The portion of depreciation that is unfunded reflects the deficit of that activity.

Operating Revenue (excluding rates)

Operating Expenditure (excluding internal interest)

Capital Expenditure Infrastructure (excluding vested assets)

6.1 Capital Expenditure Infrastructure

As at 30 September 2021, Capital Expenditure is $702,000 behind budget. Level of Service projects are $591,000 behind budget, Renewals and Capital Growth are $53,000 and $40,000 behind budget respectively.

6.2 Income and Operational Expenditure

Activity income and expenses have been reviewed in detail and commentary has been included below for variances between actuals and budget of greater than or less than $50,000.

Terms Used

Ahead/behind – this indicates that the variance is due to timing, or that it is not yet known whether the variance will continue for the full year. This should be clarified in the commentary.

Over/under – this indicates that a budget has been overspent or underspent, and that it is likely there is an actual cost saving or overrun. This should be made clear by the commentary.

Transport

6.2.1 Subsidised Roading expenditure is greater than budget by $131,000. Footpath maintenance is over budget by $39,000 as a result of catch-up maintenance work done due to interrupted work periods earlier in the year from Covid-19 and a high level of service requests driven by the increase in number of people who are getting out and about during lockdown periods. There was unexpected expenditure of $120,000 against a nil budget for storm damage during a winter weather event and this expenditure is expected to rise to $150,000 by the end of October 2021. Structures Inspections is $16,000 under budget as the principal inspections started earlier than planned which were largely claimed for in the 2020/21 financial year.

6.2.2 Unsubsidised Roading expenditure is greater than budget by $118,000. Unexpected expenditure of $35,000 was incurred, against a nil budget, to address the issues experienced in Main Road Stoke as a result of the stormwater armco culvert failure. Tidy Town expenditure is $18,000 over a nil budget. The Tidy Town budget and actuals were previously incorrectly coded to the Parking and CBD Enhancement cost centre in error. Although the actuals have been shifted to Unsubsidised Roading in the current year, the budget has not been yet been created in that cost centre and this is being addressed.

6.2.3 Parking and CBD Enhancement income is less than budget by $58,000. Off Street Meter Fees are under budget by $19,000 and income from rent is under budget by $37,000 both due to the impacts from Covid shutdown periods.

Solid Waste

6.2.4 Transfer Station income is greater than budget by $132,000. Local Disposal Levies recoverable from Landfill is $121,000 over budget due to higher-than-expected expenditure in this cost centre as mentioned below.

6.2.5 Transfer Station expenditure is greater than budget by $132,000. The Hopper operation contract is $23,000 over budget due to the new contract now including some additional services previously paid out of different budget lines. Budget reallocations within the cost centre will be corrected in the next quarter. There was a budget created in this cost centre to recover $71,000 towards activity funded staff costs which appears to be an error and this is being investigated. Due to the revaluation of assets in June 2021, depreciation expense is $6,000 over budget

6.2.6 Recycling income is less than budget by $70,000. Local Disposal Levies recoverable from Landfill is $69,000 behind budget due to lower-than-expected expenditure in this cost centre as mentioned below.

6.2.7 Recycling expenditure is less than budget by $132,000. This is behind budget for $137,000 due to late receipt of the September invoice.

Wastewater

6.2.8 Wastewater income is less than budget by $163,000. Commercial trade waste income is under budget by $119,000 due to the impacts of COVID-19 lockdown and an over estimation of volume of annual flow when setting up the budgets.

6.2.9 Wastewater expenditure is greater than budget by $135,000. Regional Sewerage: NCC share, and wastewater reticulation reactive maintenance are ahead of budget by $43,000 and $36,000 respectively both of which are timing issues. Due to the revaluation of assets in June 2021, depreciation expense is $59,000 over budget.

7. Commentary on Capital Projects

7.1 All infrastructure capital projects with a budget greater than $250,000 in this financial year or have an overall project budget of over 1M across the life of the project have a project sheet in Attachment 1 of this report. Key work this quarter is detailed below.

7.2 Hardy Vanguard watermain upgrade was completed, with final traffic island reinstatement delayed at the request of New World. The Island will not be replaced until the work on Gloucester Street has been completed to ensure there are no entry/exit issues for New World.

7.3 Airlie Street stormwater upgrade commenced on site in September.

7.4 Cawthron stormwater realignment (Science and Technology Precinct) commenced in October.

7.5 Awatea Place pump-station construction commenced during the quarter.

7.6 Rocks Road to Magazine Point watermain renewal commenced with a completion date of late October.

7.7 Washington Valley stormwater upgrade (Stage 1 - Hastings Street) was awarded with a start date expected January 2022. The final project value came in approximately $600,000 less than the engineers estimate and any savings at the end of the project will be offset against other over expenditures.

7.8 Wakatu stormwater upgrade and Tosswill to Tahuna stormwater upgrade projects were completed with savings of $323,000 and $135,000 respectively.

7.9 In the September Quarterly report, it was suggested that once savings were realised that these would be used to offset additional costs incurred in the first instance on the Cawthron stormwater relocation project followed by the Wastney, Airlie and Washington stormwater upgrades. The savings incurred to date on the Wakatu and Tosswill contracts are enough to offset the additional Cawthron stormwater costs of $226,000 and will go a long way to address the additional COVID-19 lockdown contractual costs. Any final savings realised on Washington Valley will be used to offset additional costs on Wastney and Airlie.

8. Provincial Growth Funded Projects

8.1 One project - York Valley road resurfacing - remain to be completed but agreement with the Department of Internal Affairs (DIA) has been reached to have this completed by December.

9. Three Waters Services Reform

Stimulus Package Update

9.1 The Department of Internal Affairs (DIA) and Crown Infrastructure Partners (CIP) have approved the Council’s Delivery Plan (Plan) resulting in just over $5.7M of external funding being awarded to Council.

9.2 The roll out of the programme is an ongoing discussion with DIA. Key items to note during this quarter are as follows:

· Re-allocation of budget of $244,518 from ‘Staff Resources’ to ‘Awatea Place Pump Station’ ($243,157) and ‘Maitai Dam – Lindavia Testing’ ($1,361).

· Council is continuing to experience issues with recruiting two Asset Engineers. As reported in the previous quarterly report, officers planned to second engineers from engineering consultancies, and requested an increase in budgets to enable this. To date, five consultancies have been approached, and council has been unable to secure any resources. Council is again readvertising these roles, and are further investigating opportunities for seconding staff in, however, it is highly unlikely that this budget will now be fully spent. Council officers suspect the issue surrounding recruitment is due to a national shortage of engineers, and uncertainty with job security associated with the Three Waters Reform.

9.3 A summary of the progress for all projects is provided hereafter:

PROJECT	TYPE	APPROVED FUNDING	UPDATED FUNDING	PROGRESS
General Programme
3 Waters roll out - discussion/collaboration	Opex	$53,500	$53,500	On track
*General Programme Sub-Total*		*$53,500*	*$53,500*
Staff Resources		$557,000	$311,982	Requesting approval from DIA to transfer funds to Awatea PS.
*Staff Resources Subtotal*		*$557,000*	*$311,982*
Water Programme
Maitai Dam – Lindavia Testing	Opex	$40,000	$41,361	Completed
Climate Change – Emission Reduction Strategy	Opex	$70,000	$70,000	On track
Water Pipeline Renewals Strategy	Opex	$30,000	$30,000	On track
Maitai Original Raw Water Pipeline Renewal Strategy	Opex	$60,000	$60,000	On track
Reticulation Water Quality Improvement and Pressure Management Strategy	Opex	$70,000	$70,000	On track
*Water Programme Sub-Total*		*$270,000*	*$271,361*
Wastewater Programme
NWWTP Resource Consent Monitoring Programme	Capex	$200,000	$200,000	Completed
NWWTP Pond Management Improvements	Opex	$190,000	$190,000	On track
Awatea Place Pump Station	Capex	$3,538,458*	$3,781,615*	Construction underway. Requesting approval from DIA to transfer underspend to Awatea PS.
Beach Road Wastewater Storage	Capex	$300,000*	$300,000*	Completed
Trade Waste Improvement Programme	Opex	$170,000	$170,000	On track
Wastewater Pipeline Renewals Strategy	Opex	$30,000	$30,000	On track
Climate Change - Wastewater Network Heat Mapping	Opex	$30,000	$30,000	Completed
Climate Change Emission Reduction Strategy	Opex	$175,000	$175,000	On track
Pump Station Data Collection, Storage and Use	Opex	$50,000	$50,000	On track
*Wastewater Programme Sub-Total*		*$4,680,000*	*$4,926,615*
Stormwater Programme
Condition Performance Assessment	Opex	$30,000*	$30,000*	On track
Stormwater Quality Strategy	Opex	$130,000	$130,000	On track
*Stormwater Programme Sub-Total*		*$160,000*	*$160,000*
GRAND TOTAL		$5,723,458	$5,723,458

* Does not represent total project budget, only the external contribution from the Three Waters Stimulus Programme.

10. Status Report Update

10.1 Sandbags - To inform a future Infrastructure report, officers will investigate what policy and practice other councils have in this area. Advice is being taken from Civil Defence. In addition, messaging about sandbags in general for Council communication will be improved (how they work, where to get them, how to install/dispose of). Due to resourcing issues and current workload pressures on the likes of three waters reform and the Infrastructure Acceleration Fund (amongst others), this report has not been actioned and remains a low priority. Offices will look at prioritising this in the new year if possible.

11. LTP 2021-31 decision feedback

11.1 The following table provides an update on outstanding decisions made when the LTP was approved with relevant officer comment:

Item

Council resolution

Comment

Ariesdale Terrace

Approves bringing forward $40,000 from Year 5 and $40,000 from Year 6 for the Ariesdale Terrace project to Year 1 and Year 2 of the Long Term Plan 2021-31.

Officers will be commencing investigations in Q2 of 21/22 financial year.

12. Commentary on operational projects

12.1 There is a detailed status report for one operational project (Inflow and Infiltration) included in the attachments. This project has been selected for quarterly reporting as it has been assessed to be of particular interest to the Committee.

12.2 Operational projects are assessed on the same factors – quality, time and budget and noted as being on track, with some issues/risks or with major issues/risks. Project updates are appended in Attachment 1.

Stormwater

12.3 Ecosol Litter Basket Update – As reported in the previous quarterly report, a trial using an in-sump stormwater device that traps sediment and litter is underway within the city centre. The first round of sampling has been completed and initial results show a variety of contaminants including arsenic, copper, zinc, total hydrocarbons and large litter materials are being captured. Officers have identified similar studies by three other Councils and are consolidating this information to ensure Council has a more comprehensive plan on the preferred location and function of these devices. Council recently reinstalled these devices to assist with greater sampling data, identifying ongoing maintenance issues and a maintenance cost assessment. This information will help inform both capital costs and ongoing operating costs should these baskets be installed extensively. All results will inform the litter basket business case and inform the wider Stormwater Water Quality Strategy and future Transportation and Stormwater Activity Management Plans.

Solid Waste/Waste Minimisation

12.4 Following on from the waste minimisation grants trial in 2020/21, a review of the trial has been completed alongside research into grant programmes offered by other Councils. As a result, a comprehensive grants programme enabling community-led waste minimisation will now be available in 2021-22. Grants such as those for event waste minimisation, and small projects for not-for-profit groups, will be available on an ongoing basis. The main contestable grants round for waste minimisation will open in February 2022, with an additional contestable round focusing on supporting repair activities opening on 16 October 2021.

12.5 Ongoing workshops and activities such as the Saturday market hub for foodwaste and home compost education have been impacted by COVID-19, but where possible activities have continued. An example is the Repair Café being hosted with the Nelson Tasman Climate Forum on 16 October (International Repair Day), Second-hand Sunday, and home composting workshops in partnership with Tim’s Garden.

12.6 Construction and demolition waste continues as a priority. Due to COVID-19, the first engagement event with the building sector (a builder’s breakfast at the Saxton Oval) was postponed. However, discussions are underway to broaden building sector engagement with key organisations such as Master Builders and Certified Builders NZ at a local level. Work is also underway coordinating the sharing of knowledge and resources across the local government sector.

12.7 Council walking the talk with waste minimisation continues to be a focus, with a waste minimisation plan now completed for Greenmeadow Pūtangitangi, covering both the facility operations and casual hire.

12.8 The Don’t Bin Batteries programme design has been completed, with launch scheduled for October 2021.

12.9 In August the kitchen waste trial collection service was paused due to COVID-19 alert levels and it resumed at level 2. Now that Council have established a reliable estimate of available tonnes, research is being conducted on processing options. This includes engagement with other councils and planned visits to composting plants, vermiculture sites, and other appropriate processing options. Officers will be preparing an Expression of Interest for a collection and processing service. This is a preparatory step to advise and gather information from potential service providers. A full report will be bought to a future committee meeting to decide on next steps.

12.10 During COVID-19 level 3 yellow-bin recycling was collected and disposed of to landfill. Glass was collected and recycled. The total disposed to landfill was 71.86 tonnes. There were no changes to the collection service. The MRF reopened at level 2 and since that time all recyclables have continued to be recycled.

Transport

12.11 Council’s Transport Operations team has secured a global resource consent to undertake road maintenance activities at night. The main activities include road resurfacing, line marking and road sweeping. Councils’ annual night works programme will be published on Council’s website, which will include up to 20 resurfacing sites per year. This will minimise traffic disruptions. This financial year, some of the sites identified for nightworks include Saxton Road/Main Road Stoke roundabout, Saxton Road West, and Selwyn Place. Officers are currently working through the planning of this these sites with contractors. Resealing flyers have been sent to residents and road closures are currently being advertised. The 2021/22 sealing season is programmed to start on the 8 November 2021.

12.12 Bus patronage has been challenging in the first quarter of 2021/22 because of the COVID delta variant restrictions. Patronage for the quarter was approximately 64% of the same time in 2020/21

12.13 Innovative Streets Nelson South project celebration planned at Nelson Intermediate was postponed due to COVID-19 alert levels and will hopefully take place in term 4.

12.14 Work on the Parking Strategy continues with meetings having been held with city centre businesses and landowners alongside the city centre spatial plan engagement. Meetings with the Tahunanui and Stoke communities were delayed due to COVID-19 alert levels but held in late October. A workshop with Councillors will take place on 2 November.

12.15 Road safety - Under Council’s cycle safety programme 855 students across Nelson/Tasman have received training. A number of schools training was affected by the sudden change in COVID alert levels and has been completed or rescheduled since we have been at Alert Level 2. Other COVID related delays include Motorcycle Awareness Month- which is usually in October, was been moved online into November and Bikers Brunch has been postponed until 2022.

12.16 Travel Demand Management - Workplace Travel Planning continues with several employers, including Nelmac, to promote active travel and use of public transport. Officers are working with Mitre 10 Mega who have shown interest in promoting more active transport support as part of a workplace wellness programme. School Travel Planning continues but has been interrupted due to COVID-19. Officers will continue to work with Birchwood Primary in term 4. Programmes for Broadgreen Intermediate and Nayland Kindergarten are now planned for delivery in term 1 of 2022.

13. Risks

13.1 Risks reported last quarter remain front of mind through this quarter and are expected to continue during this financial year. As a result of the streamlined procurement process and key focus on supporting the economy, projects continue to move at pace. Risks associated with this are:

· Potential prices above approved budgets that will require Council approval resulting in contractors’ programmes disrupted with potential for them to give preference to other work resulting in projects not proceeding during the financial year.

· Delays on material delivery (local and overseas) is a very high risk and has now been realised, with price increases and supply chain issues. As noted last quarter, costs of pipes has increased from a 9% increase up to 26% and officers are also noting more products are taking longer to secure.

· Nurseries and planting contractors have raised concerns in terms of meeting forward future work (21/22 and 22/23) due to the high requirement across all sectors for plants.

· Market buoyancy leading to inability to secure resources in a timely manner.

· Staff within the Infrastructure Group are continuing to experience prolonged periods of high workloads. This is anticipated to continue for the foreseeable whilst officers are needed to provide additional support for unplanned/re-active work including the Three Waters Reform and Infrastructure Acceleration Fund as well as input into existing programmed work such as the Nelson Plan, Future Development Strategy, Land Development Manual, and other cross Council projects/Government initiatives.

14. Key Performance Measures

14.1 As part of the development of the Long-Term Plan 2018-28 (LTP) Council approved levels of service, performance measures and targets for each activity. There are 35 performance measures that fall under the Infrastructure Committee. The final results for each performance measure will be reported on through the Annual Report.

· On track

· Not on track

· Achieved

· Not achieved

14.2 Attachment 2 lists all performance measures within the Infrastructure Committee delegations, their status and commentary for the quarter.

14.3 Overall, 27 out of the 35 performance measures can be confirmed as being on track.

14.4 For Utilities, 23 out of 25 performance measures are on track, and 2 have not yet been measured.

14.5 Of the 7 transport measures 2 are on track, 3 not yet measured, and 2 not on track. The 2 not on track are public transport patronage which has been affected by COVID-19 and responsiveness to Service Requests (SR’s) which reflects staff workload and higher numbers of SR’s received over lockdown.

14.6 Of the 3 Solid Waste performance measures 2 are on track and one not yet measured.

Author: Lois Plum, Manager Capital Projects

Attachments

Attachment 1: A2775741 - Infrastructure quarter one 2021_22 one page report ⇩

Attachment 2: A2774733 - Performance measures first quarter 2021_22 ⇩

Excerpt from Nelson City Council Delegations Register (A11833061)

Infrastructure Committee

Areas of Responsibility:

Delegations:

Powers to Recommend to Council:


Resolved IC/2021/015
	*That the Infrastructure Committee* 1. Receives and accepts the apology from Her Worship the Mayor R Reese for attendance, and from Councillor P Rainey for early departure.
McGurk/O'Neill-Stevens Carried