Agenda of Council - 17 February 2022

Item	General subject of each matter to be considered	Reason for passing this resolution in relation to each matter	Particular interests protected (where applicable)
1	Council Meeting - Confidential Minutes - 8 December 2021	Section 48(1)(a) The public conduct of this matter would be likely to result in disclosure of information for which good reason exists under section 7.	The withholding of the information is necessary: · Section 7(2)(i) To enable the local authority to carry on, without prejudice or disadvantage, negotiations (including commercial and industrial negotiations) · Section 7(2)(a) To protect the privacy of natural persons, including that of a deceased person · Section 7(2)(h) To enable the local authority to carry out, without prejudice or disadvantage, commercial activities
2.	Recommendation from Committees Chief Executive Employment Committee 25/01/22 Chief Executive’s Performance Review 2020/21	Section 48(1)(a) The public conduct of this matter would be likely to result in disclosure of information for which good reason exists under section 7	· Section 7(2)(a) To protect the privacy of natural persons, including that of a deceased person

Nelson City Council Minutes – 8 and 9 December 2021

Minutes of a meeting of the

Nelson City Council

Te Kaunihera o Whakatū

Held in the Council Chamber, Civic House, 110 Trafalgar Street, Nelson on Wednesday 8 December 2021, commencing at 10.33a.m.

Present: Her Worship the Mayor R Reese (Chairperson), Councillors Y Bowater, T Brand, J Edgar (Deputy Mayor) (via Zoom), M Lawrey, R O'Neill-Stevens, B McGurk, G Noonan, P Rainey, R Sanson and T Skinner

In Attendance: Chief Executive (P Dougherty), Group Manager Infrastructure (A Louverdis), Group Manager Environmental Management (C Barton), Group Manager Community Services (A White), Group Manager Corporate Services (N Harrison), Group Manager Strategy and Communications (N McDonald), Team Leader Governance (R Byrne) and Governance Adviser (E Stephenson)

Apologies: Councillor K Fulton and Councillor M Courtney for absence and Councillor Bowater for lateness

Karakia and Mihi Timatanga

1. Apologies

Resolved CL/2021/249

That the Council

1. Receives and accepts the apologies from Councillor K Fulton and Councillor M Courtney for absence and from Councillor Y Bowater for lateness.

Her Worship the Mayor/Noonan Carried

Attendance: Councillor O'Neill-Stevens entered the meeting at 10.35am.

2. Confirmation of Order of Business

The order of business was fluid, to accommodate external presenters and timebound matters.

Attendance: Councillor Edgar entered the meeting (via Zoom) and Councillor Skinner entered the meeting at 10.37am.

[]

3. Interests

There were no updates to the Interests Register, and no interests with items on the agenda were declared.

4. Public Forum (via Zoom)

4.1. John Fitchett - Consultation Forms

Document number R26479

John Fitchett tabled a supporting document (A2802360) and spoke about consultation forms. He noted his concerns regarding the Wakatū Square consultation documents and he felt the officer’s report was misleading, omitting relevant aspects. He referred to legal decisions regarding inadequate consultation.

In response to a question as to which feedback document he was referring to, Mr Fitchett said that it was the report to the 28 October Council meeting and accepted that Elected Members had received 600 pages of feedback, but that the press release only referred to 53% in support of the sale and this was misleading as submitters had supported various things. He confirmed that he knew the difference between feedback and engagement and formal consultation, but felt that Council should know who was providing the feedback.

Attachments

1 A2802360 - John Fitchett tabled document

4.2. Ekos Kamahi Ltd – Adoption of the Forestry Activity Management Plan

Document number R26487

Sean Weaver, CEO, Ekos Kamahi Ltd, tabled a supporting document (A2802908) and provided a PowerPoint presentation (A2803213). He spoke about the increasing risk of extreme weather events, flooding and cyclones and felt that landscapes needed to adapt and be resilient, and that forestry could play a role in reducing the risk via ecological infrastructure. He highlighted rising carbon prices and new opportunities for commercially viable forest options with a combination of exotic and native tree species. Mr Weaver answered questions regarding forestry management.

Attachments

1 A2802908 - Tabled document - Carbon financed conservation forestry

2 A2803213 Sean Weaver PowerPoint Presentation

4.3. Arko Biswas – Digital Interactive Wayfinding Systems for Pedestrian Environments

Document number R26489

Arko Biswas, from Cutting Edge, provided a presentation (A2802586) and spoke about Digital Interactive Wayfinding Systems for Pedestrian Environments (CUIK). He noted that this was a locally developed system and highlighted its uses and benefits and that it was community driven and would be of no cost to Council or taxpayers. Mr Biswas answered questions on other Councils’ use of the system and the possibility of the system replacing community boards, noting that would be a different system and a conversation for another time.

Attachments

1 A2802586 - Arko Biswas CUIK Presentation

The meeting was adjourned from 11.20am until 11.35am. during which time Councillor Bowater joined the meeting.

Her Worship the Mayor advised of a late item for the confidential part of the meeting, and that the following resolution needed to be passed for the item to be considered:

5. Land Purchase - Central City – Late Item

Resolved CL/2021/250

That the Council

1. Considers the confidential item regarding Late Item: Land Purchase - Central City at this meeting as a major item not on the agenda, pursuant to Section 46A(7)(a) of the Local Government Official Information and Meetings Act 1987, to enable a timely decision to be made.

Noonan/O'Neill-Stevens Carried

6. Confirmation of Minutes (Agenda Item 5)

6.1 28 October 2021

Document number M19037, agenda pages 21 - 36 refer.

Note: A statement in paragraph 4.3 of the 28 October 2021 Council minutes (agenda page 23), that the Nelson Marlborough District Health Board had not specifically submitted to the Nelson Future Access Project around noise issues, was incorrect.

Resolved CL/2021/251

That the Council

1. Confirms the amended minutes of the meeting of the Council, held on 28 October 2021, as a true and correct record.

Her Worship the Mayor/Bowater Carried

6.2 17 November 2021

Document number M19081, agenda pages 37 - 56 refer.

Resolved CL/2021/252

That the Council

1. Confirms the minutes of the meeting of the Council, held on 17 November 2021 and reconvened on 23 November 2021, as a true and correct record.

Sanson/Skinner Carried

6.3 23 November 2021 - Extraordinary Meeting

Document number M19105, agenda pages 57 - 59 refer.

Resolved CL/2021/253

That the Council

1. Confirms the minutes of the extraordinary meeting of the Council, held on 23 November 2021, as a true and correct record.

Her Worship the Mayor/Edgar Carried

7. Confirmation of Minutes 09 September 2021

Document number R26452, agenda pages 60 - 68 refer.

An amendment to the 9 September minutes was noted in that Councillor Edgar was an apology but was also mistakenly recorded as present.

Resolved CL/2021/254

That the Council

1. Confirms the amended minutes of the meeting of the Council, held on 09 September 2021, as a true and correct record.

McGurk/Edgar Carried

8. Council Minutes 19 October 2021

Document number R26453, agenda pages 69 - 76 refer.

Resolved CL/2021/255

That the Council

1. Confirms the minutes of the meeting of the Council, held on 19 October 2021, as a true and correct record.

Her Worship the Mayor/Skinner Carried

9. Recommendations from Committees (Agenda Item 8)

9.1 Environment and Climate Committee - 4 November 2021

9.1.1 Biosecurity Annual Report 2020/21 & Operational Plan 2021/22

Resolved CL/2021/256

That the Council

1. Approves the Operational Plan 2021/22 for the Tasman-Nelson Regional Pest Management Plan (A2763427 of Report R26273), specifically as it relates to Nelson City Council’s area.

McGurk/Sanson Carried

9.2 Infrastructure Committee - 18 November 2021

9.2.1 Water Supply Activity Management Plan 2021-31

Resolved CL/2021/257

That the Council

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

McGurk/O'Neill-Stevens Carried

8.2.2 Wastewater Activity Management Plan 2021-31

Resolved CL/2021/258

That the Council

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

McGurk/O'Neill-Stevens Carried

9.2.3 Stormwater and Flood Protection Activity Management Plan 2021-31

Resolved CL/2021/259

That the Council

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

McGurk/O'Neill-Stevens Carried

9.4 Community and Recreation Committee - 2 December 2021

9.4.1 City For All Ages/He Rautaki Whakatupuranga Strategy

The motion was taken in parts.

Resolved CL/2021/260

That the Council

1. Endorses the City For All Ages/He Rautaki Whakatupuranga Strategy as strategic guidance for Council, stakeholders and the community in considering and responding to the opportunities and challenges Nelson’s ageing demographic presents.

Skinner/Brand Carried

Resolved CL/2021/261

That the Council

2. Agrees that Council make an application for Nelson to join the World Health Organisation’s Age-Friendly Network.

Skinner/Brand Carried

Resolved CL/2021/262

That the Council

3. Supports the establishment of an Age-Friendly Nelson Implementation Group to monitor, support and report on implementation of the Strategy, operating according to the Terms of Reference attached in A2790587.

Skinner/Brand Carried

9.4.2 Cemetery Provision in Nelson and Richmond - Needs Assessment and Draft Implementation Plan

The motion was taken in parts. Councillor Noonan requested that her vote against clause 2 of the motion be recorded.

Resolved CL/2021/263
	*That the Council* *1. Confirms that the Council’s preferred option at this time is to further investigate the development of a new joint regional cemetery; and* *2. Subject to Tasman District Council passing similar resolutions:* *a. Approves the draft Joint Regional Cemetery Project Implementation Plan (A2774202); and* *b. Approves the establishment of a Joint Regional Cemetery Working Group to oversee the Regional Cemetery Project Implementation Plan; and* *c. Approves the terms of reference for the Joint Regional Cemetery Working Group (A2774204); and* d. Delegates authority for any minor amendments to the terms of reference for the Joint Regional Cemetery Working Group (A2774204) and the Joint Regional Cemetery Project Implementation Plan (A2774202) to the Chair of the Community and Recreation Committee and the Group Manager Community Services in conjunction with their counterparts at Tasman District Council; and *e. Appoints the Chair and a Deputy Chair of the Community and Recreation Committee to the Joint Regional Cemetery Working Group; and* *f. Recommends an iwi representative is invited to the Joint Regional Cemetery Working Group via a request to the Iwi-Council Partnership Group.*
Skinner/Brand Carried Resolved CL/2021/264
That the Council 3. Notes that a final decision on proceeding with a regional cemetery will be made by the two Councils following the endorsement of a business case by the Joint Regional Cemetery Working Group.
Skinner/Brand Carried

9.5 Strategic Development and Property Subcommittee - 3 December 2021

9.5.1 Contingent Loan Facility - Tahuna Beach Camp Inc.

In response to a question, Group Manager Corporate Services, Nikki Harrison, clarified that the emergency contingent loan facility was to allow Tahuna Beach Camp Inc. confidence in its capital expenditure programme. It was noted that, at its meeting, the Subcommittee had made a change to the date from 2022, to 2023.

Resolved CL/2021/265

That the Council

1. Approves an emergency contingent loan facility of up to $500,000 to be available to Tahuna Beach Camp Inc., if required due to COVID-19 impacts prior to 28 February 2023.

Noonan/Bowater Carried

9.5.2 Nelson Marina s17A Governance Review

The addition of clause 2 to the Subcommittee’s recommendation was noted.

Resolved CL/2021/266

That the Council

1. Approves the recommendation of a Council Controlled Organisation that manages the Marina as the preferred governance model for Nelson Marina; and

2. Notes that the Chair Strategic Development and Property Subcommittee and the Group Manager Community Services will review and approve the consultation documentation before it is released to the community; and

3. Approves undertaking consultation on the proposal to establish a Council Controlled Organisation as per Section 56 of the Local Government Act; and

4. Notes that undertaking consultation on a proposal to establish a Council Controlled Organisation would require additional unbudgeted expense to a maximum of $65,000 in addition to current budget ($40,000), to formulate the required documentation and reviews for the new Council Controlled Organisation; and

5. Approves funds, if required for undertaking consultation, to be sourced from the Marina closed account.

Noonan/Bowater Carried

9.6 Regional Transport Committee - 6 December 2021

9.6.1 Variation to Regional Land Transport Plan - Rocks Road Walking and Cycling Pre-Implementation

Resolved CL/2021/267

That the Council

1. Approves that the Nelson Regional Land Transport Programme 2021-31 is varied to include a total of $6.5M for “Pre-implementation Phase” for the SH6 Rocks Road Walking and Cycling facility spread over the 2021-24 financial years.

McGurk/O'Neill-Stevens Carried

10. Status Report - Council - 9 December 2021

Document number R26436, agenda pages 88 - 113 refer.

Questions were answered regarding matters included in the status report.

Councillors Sanson, Lawrey and O’Neill-Stevens requested that the minutes record their concerns regarding the possibility of a conflict of interest relating to the independent forestry review being undertaken by the current forestry manager, particularly in light of Sean Weaver’s earlier public forum presentation.

Resolved CL/2021/268

That the Council

1. Receives the report Status Report - Council - 9 December 2021 (R26436) and its attachment (A1168168).

Her Worship the Mayor/Noonan Carried

11. Property and Facilities Activity Management Plan 2021-31

Document number R26364, agenda pages 114 - 125 refer.

Parks and Facilities Activity Planner, Jane Loughnan, accompanied by Manager Parks and Facilities, Rosie Bartlett, presented the report. Ms Loughnan clarified the addition to recommendation clause 3 to enable Her Worship the Mayor to approve minor changes to the Activity Management Plan (AMP), as the AMP covered matters across the delegations of several committees. She answered questions on the AMP regarding minor amendments, earthquake prone buildings, performance measures and levels of service and the frequency of AMP reviews.

Councillor Noonan requested that the minutes note that Kinzett Terrace was still across the delegations of two committees and requested that, for clarity, staff investigate the reason it was purchased and where it should sit.

Resolved CL/2021/269

That the Council

1. Receives the report Property and Facilities Activity Management Plan 2021-31 (R26364) and its attachment (A2443568); and

2. Adopts the Property and Facilities Activity Management Plan 2021-31 (A2511502)

3. Delegates authority for any minor amendments required to the Property and Facilities Activity Management Plan 2021-31 (A2511502) to the Mayor, Community and Recreation Committee Chairperson, Strategic Development and Property Subcommittee Chairperson (for their respective areas of delegation), and Group Manager Community Services.

Noonan/Skinner Carried

12. Infrastructure Acceleration Fund: Request for Proposals (Agenda Item 14)

Document number R26340, agenda pages 152 - 178 refer.

Resolved CL/2021/270

That the Council

1. Receives the report Infrastructure Acceleration Fund: Request for Proposals (R26340) and its attachments (A2772290 and A2797854); and

2. Notes that officers will be progressing the Requests for Proposal of the following projects, noting that this in no way fetters any future Council decision making in relation to the proposals, including in its regulatory capacity:

a. Achilles Avenue/Rutherford Street Affordable Housing development;

b. Solitaire Investments Limited/Marsden Park Limited (Marsden Valley);

c. Wakatū Incorporation (Horoirangi); and

3. Notes that the Maitai Development Co “Mahitahi” (Kaka Valley) developer has deemed that there are other options that better suit their goals and vision for this development which they are actively pursuing instead of the Infrastructure Acceleration Fund; and

4. Notes the priority ratings allocated to the developments, as required by Kāinga Ora, as part of the Request for Proposal submission process, namely:

a. Priority 1 - Achilles Avenue/Rutherford Street Affordable Housing development;

b. Priority 2 - Solitaire Investments/Marsden Park Limited (Marsden Valley);

c. Priority 3 - Wakatū Incorporation (Horoirangi); and

5. Notes that a further report will be brought to Council once Kāinga Ora has decided which, if any, of Council’s Request for Proposals are successfully through to the negotiation stage, detailing:

a. The required level of Council investment in infrastructure to support each qualifying development; and

b. Whether or not this funding is included in the Long-Term Plan 2021-31 and which year(s); and

c. The impact of prioritising any capital projects that support qualifying development on the phasing of other capital projects within the Long-Term Plan 2021-31 work programme;

d. Any developers’ agreements required to progress the negotiations; and

e. The capacity of Council to deliver multiple additional infrastructure projects within the required timeframe.

Her Worship the Mayor/McGurk Carried

The meeting was adjourned from 12.40pm until 1.30pm. at which time, Councillors Brand, Noonan, Rainey and Skinner were not present.

13. 2021 Revaluation Presentation - Quotable Value

Document number R26246

Attendance: Councillor Skinner returned to the meeting at 1.35pm, Councillor Brand at 1.37pm, and Councillor Rainey at 1.38pm.

Gail Smits, National Revaluation Manager and Craig Russell, Registered Valuer and Senior Property Consultant from Quotable Value, Council’s Valuation Service Provider, provided a PowerPoint presentation (A2802169). Ms Smits provided background on the revaluation process and market growth. It was noted that the values were unaudited and would not be audit approved until January 2022.

Mr Russell talked about the Nelson City house value market movement, residential and commercial markets and valuation objection rights. Ms Smit and Mr Russell answered questions regarding valuation levels across the country and demand from out of town buyers.

In response to questions, Group Manager, Corporate Services, Nikki Harrison, clarified that increased valuations did not have an impact on the amount of rates required to run the city so would not increase rates, and that revaluation changes may cause a redistribution in rates.

The need for a clear communications plan was noted and it was confirmed that a media release would occur, but that there would be a gap before the public received rating notifications.

Attachments

1 A2802169 - 2021 Revaluation Presentation - Quotable Value

14. Three Waters Reform Update and submission on Three Waters Economic Regulator discussion document (Agenda Item 15)

Document number R26389, agenda pages 179 - 188 refer.

An updated copy of the draft submission was tabled (A2786027).

Policy Adviser, Gareth Power Gordon, presented the report and answered questions on the submission regarding the government’s acknowledgment of the concerns regarding communications on the matter to-date, stakeholders, opportunities to inform Council’s submission, the limited timeline for public engagement and the choice of who would provide the economic regulator service.

During questions, it was agreed that the response to question 22 in the submission would be amended to include that consideration be given to the development of a Consumer Charter and that the submission ask that the levy system be publicly consulted on beforehand.

Further questions included when agreement on the need for an economic regulator was reached, community engagement and the Select Committee process. It was clarified that the submission was based on public engagement earlier in the year when feedback was provided to the Minister.

It was reiterated that staff had not started drafting a submission on the Water Service Entity Bill, as they had not yet received a copy of the Bill or undertaken public consultation to determine what the submission was likely to include.

Councillor Brand advised of an alternative model she was considering proposing. Her Worship the Mayor suggested that Councillor Brand respond to the email from LGNZ to send her thoughts through to the Working Group and noted that she was also able to bring back her views when Council decided on its submission to Select Committee.

The inclusion of Council’s preference for a three yearly review of prices, rather than five yearly, in response to question 12 of the submission and in the public survey was suggested.

Attendance: Councillor Noonan returned to the meeting at 2.46pm.

The motion was taken in parts.

Resolved CL/2021/271

That the Council

1. Receives the report Three Waters Reform Update and submission on Three Waters Economic Regulator discussion document (R26389) and its attachments (A2788174, A2786106, A2786027).

McGurk/Her Worship the Mayor Carried

Resolved CL/2021/272

That the Council

2. Approves the draft Council submission (A2786027) to the Ministry of Business, Innovation and Employment on the Economic Regulation and Consumer Protection for Three Waters Services in New Zealand; and

3. Agrees that the Mayor, Infrastructure Committee Chair and Chief Executive be delegated authority to approve minor editorial amendments to the Council submission (A2786027); and

4. Notes the Government will introduce legislation to Parliament where Council and the public will have the opportunity to submit on the Water Services Entities Bill and subsequently the Water Services Entities (Implementation Bill).

McGurk/Her Worship the Mayor Carried

Resolved CL/2021/273

That the Council

5. Agrees to community engagement to be undertaken prior to Council submitting on the draft legislation as detailed in Report R26389; and

6. Notes a submission on the Water Services Entities Bill will be prepared once the Bill is introduced to Parliament and will be brought back to Council for approval including community feedback; and

7. Notes that the Chief Executive will report back once staff have received further information and guidance from the Government on the next steps and how these should be managed.

McGurk/Her Worship the Mayor Carried

Attachments

1 A2786027 - Draft Three Waters Economic Regulation Submission

15. Deliberations on public feedback to Te Ara ō Whakatū - Nelson City Centre Spatial Plan (Agenda Item 12)

Document number R26331, agenda pages 126 - 151 refer.

Two documents were tabled, Changes made to Te Ara o Whakatuū CCSP (A2802298) and Pages from Te Ara o Whakatū Document Revisions for final version (A2802316).

Programme Lead City Development, Alan Gray, presented the report, noting that Shape Nelson information would be updated after the meeting to clarify two opposing submissions and to include one opposing submission that had been omitted.

Mr Gray noted two minor alterations and answered questions regarding the sharing of submissions into other Council workstreams, Fire and Emergency New Zealand concerns regarding traffic slowing, the work programme, the robustness of the engagement and validity of feedback and future reporting.

Resolved CL/2021/274
	*That the Council* *1. Receives the report Deliberations on public feedback to Te Ara ō Whakatū - Nelson City Centre Spatial Plan (R26331) and attachments: (A2786233, A2783462, A2780828 and A2787576); and* 2. Accepts the following late feedback (A2780828) on Te Ara ō Whakatū – Nelson City Centre Spatial Plan: · JR Elkington and Trevor duFeu; and 3. Adopts the updated Te Ara ō Whakatū – Nelson City Centre Spatial Plan (A2786233); and 4. Agrees that the Mayor, Chair of Urban Development Subcommittee and Group Manager Environmental Management be delegated to approve any minor editorial changes; and 5. Recommends officers create an implementation plan for the first phase of delivery over the next 10 years and bring that back to Council; and** 6. Notes the adoption of Te Ara ō Whakatū – Nelson City Centre Spatial Plan is a strategy that builds on and updates previous city centre strategies e.g., Heart of Nelson.
Her Worship the Mayor/Edgar Carried unanimously
	Attachments 1 A2802298 - Changes made to Te Ara o Whakatū CCSP 2 A2802316 - Pages from Te Ara o Whakatū Revisions for final version

16. Exclusion of the Public

The external attendees listed below, were in attendance for items of the Confidential agenda to answer questions and, accordingly, the following resolution was required to be passed:

Recommendation

That the Council

1. Confirms, in accordance with sections 48(5) and 48(6) of the Local Government Official Information and Meetings Act 1987, that

a. James Winchester of Simpson Grierson and Jennifer Rose of Beca, remain after the public has been excluded, for Item 3 of the Confidential Agenda (Recommendations from Committees – Confidential - Strategic Development & Property Committee 3 December 2021 – Maitai Valley Motor Camp Options), as they have knowledge relating to the item that will assist the meeting; and

b. Nick Clarke of Habitat for Humanity remain after the public has been excluded, for Item 5 of the Confidential agenda (Housing Reserve Phase One Applications), as he has knowledge relating to the item that will assist the meeting; and

c. Meg Matthews, Fiona Wilson, Toni Power and Tracee Neilson from Nelson Regional Development Agency remain after the public has been excluded, for Item 6 of the Confidential agenda (Future of Nelson iSITE within Millers Acre), as they have knowledge relating to the Nelson Regional Development Agency that will assist the meeting; and

d. Jane Sheard and Lindsay Coll of Nelmac remain after the public has been excluded, for Item 7 of the Confidential agenda (Nelmac 6 monthly strategic presentation), as they have knowledge relating to Nelmac that will assist the meeting; and

d. John Murray, Sam Cottier, Lisa Current and Nick Wilson remain after the public has been excluded, for Item 10 of the Confidential agenda (Central Library Project - Land Exchange Negotiating Brief), as they have knowledge relating to the project that will assist the meeting.

Exclusion of the Public

Resolved CL/2021/275

That the Council

1. Excludes the public from the following parts of the proceedings of this meeting.

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

Brand/Skinner Carried

Housing Reserve Phase One Applications

Section 48(1)(a)

The public conduct of this matter would be likely to result in disclosure of information for which good reason exists under section 7

The withholding of the information is necessary:

· Section 7(2)(i)

To enable the local authority to carry on, without prejudice or disadvantage, negotiations (including commercial and industrial negotiations)

Central Library Project – Land Exchange Negotiating Brief

Section 48(1)(a)

The public conduct of this matter would be likely to result in disclosure of information for which good reason exists under section 7

The withholding of the information is necessary:

· Section 7(2)(i)

To enable the local authority to carry on, without prejudice or disadvantage, negotiations (including commercial and industrial negotiations)

Land Purchase - Central City (Late Item)

Section 48(1)(a)

The public conduct of this matter would be likely to result in disclosure of information for which good reason exists under section 7

The withholding of the information is necessary:

· Section 7(2)(a)

To protect the privacy of natural persons, including that of a deceased person

· Section 7(2)(h)

To enable the local authority to carry out, without prejudice or disadvantage, commercial activities

· Section 7(2)(i)

To enable the local authority to carry on, without prejudice or disadvantage, negotiations (including commercial and industrial negotiations)

Council Meeting - Confidential Minutes - 28 October 2021

Section 48(1)(a)

The public conduct of this matter would be likely to result in disclosure of information for which good reason exists under section 7.

The withholding of the information is necessary:

· Section 7(2)(a)

To protect the privacy of natural persons, including that of a deceased person

· Section 7(2)(h)

To enable the local authority to carry out, without prejudice or disadvantage, commercial activities

· Section 7(2)(i)

To enable the local authority to carry on, without prejudice or disadvantage, negotiations (including commercial and industrial negotiations)

Council Meeting - Confidential Minutes - 17 November 2021

Section 48(1)(a)

The public conduct of this matter would be likely to result in disclosure of information for which good reason exists under section 7.

The withholding of the information is necessary:

· Section 7(2)(a)

To protect the privacy of natural persons, including that of a deceased person

· Section 7(2)(g)

To maintain legal professional privilege

The meeting went into confidential session at 3.17pm and resumed in public session at 4.23pm, at which time the meeting was adjourned until Thursday 9 December 2021.

Minutes of a meeting of the

Nelson City Council

Te Kaunihera o Whakatū

Reconvened in the Council Chamber, Civic House, 110 Trafalgar Street, Nelson on Thursday 9 December 2021, at 9.12a.m.

Present: Her Worship the Mayor R Reese (Chairperson), Councillors Y Bowater, T Brand, J Edgar (Deputy Mayor), M Lawrey, R O'Neill-Stevens, B McGurk, G Noonan, P Rainey, R Sanson and T Skinner

Apologies: Councillor K Fulton and Councillor M Courtney for absence

17. Mayor's Report (Agenda Item 9)

Document number R26350, agenda pages 77 - 87 refer.

Her Worship the Mayor spoke briefly to her report, noting that one appeal to the Representation Review had been received, which meant that the matter would now be considered by the Local Government Commission. She noted the addition of clause 3 to the recommendations.

Resolved CL/2021/281

That the Council

1. Receives the report (R26493) and its attachment (A2798220); and

2. Approves Councillor Brian McGurk as the third Nelson City Council elected member on the Joint Committee subcommittee to hear and deliberate on the draft Future Development Strategy; and

3. Delegates the Mayor and Deputy Mayor the authority to appoint alternative elected members to the Joint Committee subcommittee to hear and deliberate on the draft Future Development Strategy should the nominated members be unavailable.

4. Notes that Joint Committee will confirm appointments on the subcommittee to hear and deliberate on the draft Future Development Strategy at its first meeting in 2022.

Her Worship the Mayor/Skinner Carried

18. Residents' Survey 2020/21 (Agenda Item 17)

Document number R26030, agenda pages 203 - 207 refer.

Policy Advisor, Louis Dalzell, answered questions regarding the results of the Residents’ Survey, trends for other Councils, and COVID-19 as a contributing factor.

An additional clause 3 d) was added to the recommendation: Communicating decisions, actions and information in a clear and prompt manner.

Group Manager Strategy and Communication, Nicky McDonald, answered questions regarding Our Nelson advertising and an advertising/media policy. Some concerns were raised regarding the possibility of perceived bias, complaints and freedom of speech.

Discussion took place on the relevancy of the survey questions, Mr Dalzell advised that to maintain benchmark trends, the questions would need to be kept, however officers could continue to refine them and this was being looked at via the Te Tauihu Intergenerational Strategy.

Further discussion took place on advertising, Elected Member input to a media policy and a wider communication methodology. A suggestion was made that it would be beneficial to undertake the survey prior to implementing any advertising changes and that a broader way of collecting data over a more sustained period, giving real time feedback would be valuable.

A request was made for the addition of a clause to the recommendation to reflect that Council was taking ownership of its failures and public dissatisfaction.

Councillor Lawrey, seconded by Councillor Sanson moved the officer’s recommendation, with the additional clause 3 d).

That the Council

1. Receives the report Residents' Survey 2020/21 (R26030) and its attachment (A2724461); and

2. Notes that the Residents’ Survey 2020/21 will be made available to the public on the Council website; and

3. Notes the three focus areas for improvement in response to the Residents’ Survey results are:

a. Managing expectations by clearly explaining Council priorities and expenditure; and

b. Improving clarity on decision making and how community feedback contributes; and

c. Telling our story positively and consistently; and

d. Communicating decisions, actions and information in a clear and prompt manner.

The meeting was adjourned from 9.54am until 10.07am.

As the mover and seconder of the motion did not agree with the addition of a clause to take ownership of the survey results because they were of the opinion that Council did that all of the time, Councillor Skinner, seconded by Councillor Brand moved an amendment by way of addition

Manager Communications, Kim Grade, answered questions regarding improving Council’s social media engagement, noting that Council’s website was key but officers needed to look at other digital methods. It was clarified that the intention was that no work on advertising would take place on the media/advertising policy until the survey had been undertaken. Ms Grade confirmed that she would follow up with Council’s Engagement Manager regarding use of an engagement spectrum and levels of significance.

4. Notes that Council recognises a diversity of views and takes ownership of the survey results.

The amendment was put and a division was called:

For

Cr Bowater

Cr Brand

Cr Edgar

Cr Lawrey

Cr O'Neill-Stevens

Cr McGurk

Cr Noonan

Cr Sanson

Cr Skinner

Her Worship the Mayor Reese (Chairperson)

Against

Cr Rainey

Apology

Cr Courtney

Cr Fulton

The amendment was carried 10 - 1.

Skinner/Brand

The amendment became part of the substantive motion. During debate on the substantive motion, and with the agreement of the mover and seconder, an additional clause was added to the motion to note that no work would be undertaken on the introduction of advertising in Our Nelson until the survey had been undertaken.

Resolved CL/2021/282

That the Council

1. Receives the report Residents' Survey 2020/21 (R26030) and its attachment (A2724461); and

2. Notes that the Residents’ Survey 2020/21 will be made available to the public on the Council website; and

3. Notes that Council wishes to lift the Residents Survey results; and

4. Notes that Council recognises a diversity of views and takes ownership of the survey results

5. Notes the three four focus areas for improvement in response to the Residents’ Survey results are:

a. Managing expectations by clearly explaining Council priorities and expenditure; and

b. Improving clarity on decision making and how community feedback contributes; and

c. Telling our story positively and consistently; and

d. Communicating decisions, actions and information in a clear and prompt manner.

6. Notes that staff will undertake a survey on Council’s communication channels and their reach; and

7. Further notes that there will be no progress on the introduction of advertising in Our Nelson until the communications channel survey results have been assessed and reported back to Council.

Lawrey/Sanson Carried

The meeting was adjourned from 10.34am until 10.51am.

19. Schedule of meetings 2022 (Agenda Item 18)

Document number R26393, agenda pages 208 - 210 refer.

Manager Governance and Support Services, Devorah Nicuarta-Smith, presented the report, noting the following amendments to the schedule:

· the addition of the Councillor liaison roles dates

· Saxton Field Committee meetings would move to Fridays

· officers were continuing to liaise with Tasman District Council regarding the Future Development Strategy (FDS) project timeline of meetings and workshops

· the schedule would be adjusted so that there was no workshop time from approximately three months prior to the elections, with the exception of the 12 July 2022, FDS workshop

· the default was to avoid Wednesdays for workshop time whenever possible

· Annual Plan workshop time had been removed.

Resolved CL/2021/283

That the Council

1. Receives the report Schedule of meetings 2022 (R26393) and its attachment (A2760389); and

2. Adopts the amended schedule of meetings for the 2022 calendar year as set out in Attachment 1 (A2760389).

Her Worship the Mayor/O'Neill-Stevens Carried

20. Climate Change Oversight Governance Group Terms of Reference (Agenda Item 19)

Document number R26455, agenda pages 212 - 216 refer.

It was noted that the report contained an incorrect reference for the Terms of Reference for the Climate Change Oversight Governance Group, the correct number being (A2793754).

Group Manager Strategy and Communications, Nicky McDonald, answered questions regarding mechanisms for reporting back on the work of the Governance Group, noting that anything that needed to be reported to a committee would flow through the correct channels

A request was made to amend the word ‘issues’ on agenda page 214 paragraph 6 in the Terms of Reference – Powers to recommend – to ‘matters’

Resolved CL/2021/284

That the Council

1. Receives the report Climate Change Oversight Governance Group Terms of Reference (R26455) and its attachment (A2793754); and

2. Approves the amended Terms of Reference for the Climate Change Oversight Governance Group (A2793754).

O'Neill-Stevens/McGurk Carried

21. Approval of submission on the Government's Emissions Reduction Plan (Agenda Item 20)

Document number R26441, agenda pages 217 - 274 refer.

Climate Change Adaptation Adviser, Daniela Ramirez, answered questions regarding engagement with Elected Members and the process for writing the submission.

Councillor O’Neill-Stevens, seconded by Councillor Sanson, moved a motion to suspend Standing Orders relating to a lost Notice of Motion, to allow a matter already decided to be redebated, which would require a 75% majority.

The motion was lost.

Suspension of Standing Orders
Resolved
	That the Council 1. Suspends Standing Orders relating to a lost notice of motion.
O'Neill-Stevens/Sanson Lost

Ms Ramirez noted that she would come back to the Elected Members with responses to questions on pages 222 and 223 of the agenda report.

The item was left on the table until later in the meeting.

22. Nelson Arts Strategy - Establishment of Working Group (Agenda Item 21)

Document number R26272, agenda pages 275 - 282 refer.

It was noted that this matter was being considered by Council as it was a cross-committee matter.

Resolved CL/2021/285

That the Council

1. Receives the report Nelson Arts Strategy - Establishment of Working Group (R26272) and its attachment (A2752080); and

2. Establishes an Arts Strategy Working Group with the following membership:

1. Deputy Mayor Judene Edgar

2. Chair of Community and Recreation – Councillor Tim Skinner

3. Councillor Pete Rainey; and

3. Approves the Terms of Reference (A2752080) for the Arts Strategy Working Group.

Noonan/Bowater Carried

23. Events Strategy implementation update - Financial Year 2020-21 (Agenda Item 22)

Document number R26330, agenda pages 283 - 294 refer.

An updated diagram 1 was tabled (A2802667).

Resolved CL/2021/286
	*That the Council* *1. Receives the report Events Strategy implementation update - Financial Year 2020-21 (R26330) and its attachments (A2776994 and A2768099); and* 2. Approves an amendment to the Nelson City Events Strategy to require annual reporting by the Events Development Committee on implementation of the Strategy.
O'Neill-Stevens/Brand Carried
	Attachments 1 A2802667 - Updated diagram 1 - Events Strategy Implementation

The meeting was adjourned from 11.22am until 11.35am.

24. Recommendations from Committee - Forestry Subcommittee - 1 December 2021 (Agenda Item 8.3 revisited)

Forestry Activity Management Plan 2021-31

Councillor Sanson, seconded by Councillor O’Neill-Stevens, moved an alternative to the Subcommittee’s recommendation.

That Council

1) Notes the High Level Forestry Review work planned for 2021/2022; and

2) Directs the Forestry Subcommittee to defer planting pinus radiata on Council owned and managed land, until Full Council makes a decision on any recommendations in the Forestry Review report; and

3) Adopts the revised Forestry Activity Management Plan 2021-31 (A2072414); and

4) Notes this Activity Management Plan is a living document and that the Forestry management plan may change depending on the outcome from the Forestry Review.

The meeting was adjourned from 11.40am until 11.49am.

Item 8.3.1 was left on the table as the relevant officers were not yet present via Zoom.

25. Approval of submission on the Government's Emissions Reduction Plan (Agenda Item 20 revisited)

Document number R26441, agenda pages 217 - 274 refer.

Climate Change Adaptation Adviser, Daniela Ramirez, provided answers to previous questions on agenda pages 222 and 223, in that ‘frontier firm’ was a term used in productivity commission reports regarding firms that were most productive in their industry and that a national behavioural change local expertise programme was already underway.

The item was left on the table until later in the meeting.

26. Recommendations from Committee - Forestry Subcommittee - 1 December 2021 – (Agenda Item 8.3 revisited)

Forestry Activity Management Plan 2021-31

Councillor Sanson, seconded by Councillor O’Neill-Stevens, had previously moved:

That Council

1) Notes the High Level Forestry Review work planned for 2021/2022; and

2) Directs the Forestry Subcommittee to defer planting pinus radiata on Council owned and managed land, until Full Council makes a decision on any recommendations in the Forestry Review report; and

3) Adopts the revised Forestry Activity Management Plan 2021-31 (A2072414); and

4) Notes this Activity Management Plan is a living document and that the Forestry management plan may change depending on the outcome from the Forestry Review.

Group Manager Infrastructure, Alec Louverdis, Manager Legal Services, Fiona McLeod, and independent forestry experts, Lochie Grant, LandVision, Peter Gorman and Sam Nuske, PF Olsen, were present to answer questions.

Ms McLeod confirmed the legal principle that once Council had delegated the power to make a decision, it could not then amend that decision, in this case the Forestry Subcommittee (FSC) had already made a decision to adopt a harvesting plan under delegated authority, and Council was not now able to seek to amend that decision, and Council’s Standing Orders were based on clause 30 of the Local Government Act.

Mr Louverdis advised that harvesting plans were based on harvesting and planting, the two stood together.

John Murray, Chairperson of the FSC was invited to take part in discussion.

Following further discussion, questions and advice regarding forestry management/review and the risk of delaying harvesting or replanting, the mover and seconder proposed a change to clause 2 of the motion to amend the Forestry Activity Management Plan 2021-31:

That Council

1) Notes the High Level Forestry Review work planned for 2021/2022; and

2) Amends the Forestry Activity Management Plan 2021-31 to defer planting pinus radiata on Council owned and managed land, until Full Council makes a decision on any recommendations in the Forestry Review report; and

3) Adopts the revised Forestry Activity Management Plan 2021-31 (A2072414); and

4) Notes this AMP is a living document and that the Forestry management plan may change depending on the outcome from the Forestry Review.

During debate, the following Points of Order were raised:

· Councillor Skinner against Councillor Sanson for misrepresentation, in that she had used incorrect figures in her debate, Councillor Sanson noted that the figures she had used were taken directly from the Forestry Activity Management Plan, Mr Murray clarified there was confusion in the returns to Council from forestry, which was not a CCTO and did not pay a dividend, and Councillor Sanson rephrased her comments

· Councillor Rainey against Her Worship the Mayor for misrepresentation regarding slope stabilisation. The Point of Order was not upheld as the Mayor noted that this was the advice of experts.

The motion was put and a division was called:

For

Cr Lawrey

Cr O'Neill-Stevens

Cr Rainey

Cr Sanson

Against

Cr Bowater

Cr Brand

Cr Edgar

Cr McGurk

Cr Noonan

Cr Skinner

Her Worship the Mayor Reese (Chairperson)

Apology

Cr Courtney

Cr Fulton

The motion was lost 4 - 7.

In order to progress the matter, the meeting returned to the officer’s recommendation.

Resolved CL/2021/287

That Council

1. Adopts the revised Forestry Activity Management Plan 2021-31 (A2072414).

McGurk/Her Worship the Mayor Carried

27. Exclusion of the Public

Resolved CL/2021/288
	*That the Council* 1. Excludes the public from the following parts of the proceedings of this meeting. 2. The general subject of each matter to be considered while the public is excluded, the reason for passing this resolution in relation to each matter and the specific grounds under section 48(1) of the Local Government Official Information and Meetings Act 1987 for the passing of this resolution are as follows:
Her Worship the Mayor/Sanson Carried
6		Future of the Nelson iSITE within Millers Acre	Section 48(1)(a) The public conduct of this matter would be likely to result in disclosure of information for which good reason exists under section 7	The withholding of the information is necessary: · Section 7(2)(h) To enable the local authority to carry out, without prejudice or disadvantage, commercial activities · Section 7(2)(i) To enable the local authority to carry on, without prejudice or disadvantage, negotiations (including commercial and industrial negotiations)

The meeting went into confidential session at 12.56pm and resumed in public session at 1.23pm.

28. Nelson Regional Development Agency Presentation to Council (Agenda Item 23)

Document number R26338

Nelson Regional Development Agency (NRDA) Board Members, Alan Dunn, Marina Hirst-Tristram and Sarah-Jane Weir and NRDA Chair, Meg Matthews, accompanied by members of the NRDA Leadership Team, Toni Power, Mark Maguire, Tracee Neilson, Hannah Norton, Sarah Fitchett, Johny O’Donnell and Fiona Wilson were present via Zoom. Ms Matthews provided a PowerPoint presentation (A2802424), and answered questions on:

· NRDA Annual Report

· Outcomes of consultation on the Regeneration Plan

· NRDA Six monthly update.

Her Worship the Mayor thanked NRDA staff and acknowledged the work of its board members.

Attachments

1 A2802424 NRDA presentation

29. Exclusion of the Public

Resolved CL/2021/291

That the Council

1. Excludes the public from the following parts of the proceedings of this meeting.

Brand/Skinner Carried

Item		General subject of each matter to be considered	Reason for passing this resolution in relation to each matter	Particular interests protected (where applicable)
	5	Housing Reserve Phase One Applications	Section 48(1)(a) The public conduct of this matter would be likely to result in disclosure of information for which good reason exists under section 7	The withholding of the information is necessary: · Section 7(2)(i) To enable the local authority to carry on, without prejudice or disadvantage, negotiations (including commercial and industrial negotiations)
4		Council Status Report - Confidential	Section 48(1)(a) The public conduct of this matter would be likely to result in disclosure of information for which good reason exists under section 7	The withholding of the information is necessary: · Section 7(2)(a) To protect the privacy of natural persons, including that of a deceased person · Section 7(2)(h) To enable the local authority to carry out, without prejudice or disadvantage, commercial activities
7		Nelmac 6 monthly strategic presentation	Section 48(1)(a) The public conduct of this matter would be likely to result in disclosure of information for which good reason exists under section 7	The withholding of the information is necessary: · Section 7(2)(h) To enable the local authority to carry out, without prejudice or disadvantage, commercial activities
8		Nelmac Limited - Statement of Expectation 2022/23	Section 48(1)(a) The public conduct of this matter would be likely to result in disclosure of information for which good reason exists under section 7	The withholding of the information is necessary: · Section 7(2)(h) To enable the local authority to carry out, without prejudice or disadvantage, commercial activities · Section 7(2)(i) To enable the local authority to carry on, without prejudice or disadvantage, negotiations (including commercial and industrial negotiations)
9		Nelson Regional Sewerage Business Unit (NRSBU) independent member appointment	Section 48(1)(a) The public conduct of this matter would be likely to result in disclosure of information for which good reason exists under section 7	The withholding of the information is necessary: · Section 7(2)(a) To protect the privacy of natural persons, including that of a deceased person
3		Recommendations from Committees - Confidential Strategic Development & Property Committee 3 December 2021 Maitai Valley Motor Camp Options	Section 48(1)(a) The public conduct of this matter would be likely to result in disclosure of information for which good reason exists under section 7	The withholding of the information is necessary: · Section 7(2)(a) To protect the privacy of natural persons, including that of a deceased person · Section 7(2)(i) To enable the local authority to carry on, without prejudice or disadvantage, negotiations (including commercial and industrial negotiations)

The meeting went into confidential session at 1.57pm and resumed in public session at 4.37pm.

30. Annual Report 2020/21 (Agenda Item 16)

Document number R26237, agenda pages 189 - 202 refer.

The following documents were tabled:

· Pages showing updates made since the last version of Attachment 1 (A2802769)

· Designed version of the Annual Report 2020/21 (A2803812)

· Audit Opinion (A2803712)

· Foreword (A2804059)

It was noted that the final version of the Annual Report would include the full sale price in the paragraph on the sale of community housing.

Attendance: Councillor Sanson left the meeting at 4.43pm.

John Mackey, Office of the Auditor General, was present via Zoom and spoke to his unmodified opinion (A2803712).

Group Manager Corporate Services, Nikki Harrison clarified that the rating deficit was planned and was because of the 0% rates increase.

Attendance: Councillor Sanson returned to the meeting at 4.48pm.

Mr Mackey was required to ask the following questions of Elected Members regarding the Annual Report:

· could Elected Members confirm their confidence that the disclosures were a comprehensive and complete record?

· whether there were any breaches of significant legislation that could have a major impact on Nelson City Council?

· were Elected Members aware of any fraud?

Elected Members confirmed their confidence in the material disclosed, no breaches of significant legislation or fraud were identified.

Her Worship the Mayor thanked the Audit New Zealand team and Mr Mackey for his acknowledgement of Council’s team.

Resolved CL/2021/301
	*That the Council* *1. Receives the report Annual Report 2020/21 (R26237) and its attachments (A2791731, A2803712, A2803812 and A2804059); and* *2. Adopts the Annual Report for the year ended 30 June 2021 (A2593052) in accordance with s98 of the Local Government Act 2002; and* 3. Receives the draft Audit New Zealand Opinion (A tbc); and** 4. Delegates the Mayor and Chief Executive authority to approve minor editorial changes to the Annual Report 2020/21 (A2791731), as necessary.
Her Worship the Mayor/Edgar Carried
Attachments 1 A2802769 - Updates since the last version of the Draft Annual Report 2020-21 2 A2803812 Design Version of the Draft Annual Report 2020-21 3 A2803712 - Audit opion 4 A2804059 - Annual Report 2020/21 Foreword

31. Approval of submission on the Government's Emissions Reduction Plan – (Agenda Item 20 revisited)

Manager Environmental Planning, Maxine Day, reconfirmed that statements in the report and submission were factually correct.

Climate Change Adaptation Adviser, Daniela Ramirez, confirmed that she had consulted with the author and that the term cleanfill was correct and was as defined by the Ministry for the Environment.

With regard to the suggestion that the submission seemed to be against free fares, Ms Ramirez noted that the submission did state that Council was supportive of targeting the lower demographic.

Councillor O’Neill-Stevens reiterated that the cleanfill issue was not just about not accepting organic material but about waste that would do no harm.

That the Council

1. Receives the report Approval of submission on the Government's Emissions Reduction Plan (R26441) and its attachments (A276937, A2790131, A2790133); and

2. Approves retrospectively, the submission on the Government’s Emissions Reduction Plan (A2769372).

Her Worship the Mayor/Edgar Lost

The motion was lost, which meant that the submission would be withdrawn.

32. Exclusion of the Public

Resolved CL/2021/302

That the Council

1. Excludes the public from the following parts of the proceedings of this meeting.

Her Worship the Mayor/Brand Carried

Item

General subject of each matter to be considered

Reason for passing this resolution in relation to each matter

Particular interests protected (where applicable)

Recommendations from Committees - Confidential

Strategic Development & Property Committee 3 December 2021

Maitai Valley Motor Camp Options

Proposed Registrations of Interest Document - 258 Wakefield Quay (Anchor Building)

Section 48(1)(a)

The public conduct of this matter would be likely to result in disclosure of information for which good reason exists under section 7

The withholding of the information is necessary:

· Section 7(2)(a)

To protect the privacy of natural persons, including that of a deceased person

· Section 7(2)(i)

To enable the local authority to carry on, without prejudice or disadvantage, negotiations (including commercial and industrial negotiations)

The meeting went into confidential session at 5.04pm and resumed in public session at 6.32pm.

Karakia Whakamutunga

There being no further business the meeting ended at 6.32pm.

Restatements

It was resolved while the public was excluded:

Proposed Registrations of Interest Document: 258 Wakefield Quay (Anchor Building)

That the Council

3. Agrees that Report (R26262), the decision and attachments (A2717013 and A2803056) be released from confidential when the Request for Registrations of Interest is made available to the public.

Maitai Valley Motor Camp Options

That the Council

9. Agrees that report (R26366), the decision and attachments (A2778933, A2783832 and A2790512) remain confidential at this time.

Housing Reserve Phase One Applications

That the Council

6. Agrees that the decision only be made publicly available once negotiations are concluded; and

7. Agrees that Report (R26371) and Attachments A2788145, A2788147, A2748972) remain confidential at this time.

Future of the Nelson iSITE within Millers Acre

That the Council

5. Agrees that Report (R26345) and the decision be excluded from public release at this time.

Nelmac Limited - Statement of Expectation 2022/23

That the Council

4. Agrees that Report (R26362) and the decision be made publicly available once the completed Statement of Expectation is made available on the Nelson City Council website approximately 30 days after it is received by the Council Controlled Trading Organisation.

Nelson Regional Sewerage Business Unit (NRSBU) independent member appointment

That the Council

5. Agrees that the decision only be made publicly available once letter of acceptance received; and

6. Agrees that Report (R26252) and attachments (A2731432 and A2781375) remain confidential at this time.

Land Purchase - Central City (late item)

That the Council

6. Agrees that report R26490 and the decision be made publicly available once a sale and purchase agreement becomes unconditional.

Confirmed as a correct record of proceedings by resolution on (date)

Resolved

Item 8: COVID-19 Impacts on capital work programme and budgets: Way Forward

Council

17 February 2022

REPORT R26496

COVID-19 Impacts on capital work programme and budgets: Way Forward

1. Purpose of Report

1.1 To provide Council with an overview on the impact COVID-19 has had and will have on Council’s capital work programme and budgets.

1.2 To consider and approve a suite of streamlined processes and measures to deal with and stay ahead of ongoing COVID-19 challenges.

2. Summary

2.1 The impacts of COVID-19 on Council’s capital projects have been significant resulting in increased physical works costs arising from delays in the supply chain as well as scarce availability of experienced construction industry staff, with resultant increased salary costs.

2.2 Whilst forecasts indicate that the effects of this are likely to stabilise (although the effects from Omicron are yet unknown and untested), the outlook from COVID-19 over the next few years is still looking challenging.

2.3 This report deals with measures to streamline current processes that will allow Council to meet the COVID-19 challenges and to ensure that Council is able to create opportunities to continue to deliver the capital works programme. It is an opportunity to be pro-active in an ever changing and challenging COVID-19 environment

3. Recommendation

That the Council

1. Receives the report COVID-19 Impacts on capital work programme and budgets: Way Forward (R26496) and its attachment (A2827529); and

2. Notes and acknowledges the challenges COVID-19 has brought to date and will continue to have on the successful delivery of the capital works programme and associated budgets; and

3. Notes the unbudgeted provision of $1 Million capital expenditure in the 2020/21 financial year to cater for any COVID-19 project related increases that may result in 2020/21; and

4. Approves, subject to the approval of the 2022/23 Annual Plan, the following COVID-19 streamlined mitigation measures to support the delivery of the capital works programme going forward, effective 1 July 2022:

- An On-call COVID-19 fund of $1.8 Million in the 2022/23 financial year delegated to the Tenders Subcommittee to manage any COVID-19 project related increases as-and-when they arise;

- Amends the Tenders Subcommittee delegations to include the approval of tenders and additional expenditure, if required, from the On-call COVID-19 fund with reporting of decisions to Council as per A2827529 of Report R26496 (subject to any minor amendments by the Mayor and Chief Executive); and

5. Agrees on the principle that any project is confirmed to be within budget up to a maximum of 10% above approved budgets provided that any overspend up to the 10% be managed within existing activity budgets; and

6. Notes that updates on the effectiveness of the new measures will be provided to Council via the Audit, Risk and Finance Subcommittee on a quarterly basis; and

7. Agrees that all approved COVID-19 streamlined mitigation measures be reassessed in 12 months and presented back to Council by June 2023, to ascertain the success or otherwise of the measures that will allow a decision on whether the streamlined approach should continue, change, or stop.

4. Background

4.1 Following recent requests from officers to Council to approve additional funding resulting from COVID-19 (specifically increased costs arising from supply chain issues and increased contractor resourcing costs), to enable the award of tenders, Council resolved on 2 September 2021 as follows:

“Requests staff to undertake a review of the financial viability and deliverability of the 2021-22 to 2023-24 capital works programme due to the impact of COVID-19 on supplier costs and product delays and report back to the next Infrastructure Committee meeting”.

5. Discussion

5.1 A presentation was given to elected members as part of the Annual Plan workshops in December last year highlighting the issues experienced by Council from COVID-19 – specifically the impact of increased project costs.

5.2 Officers made a number of suggestions that would address current increases and counteract ongoing possible COVID-19 costs and these are presented to Council for consideration and approval.

Current situation

5.3 The issue of increased project costs (especially for major infrastructure projects) is a real issue experienced not only by this Council but throughout New Zealand, Australia and across the world.

5.4 The main contributing factor in increased costs is delays in the supply chain with issues ranging from no products on shelves and in yards, products wait times extending from weeks to months, raw material delays, less shipping options, and delayed transportation.

5.5 Month-on-month increases in materials and equipment are being experienced across the sector for the likes of concrete pipe products, utility pipe & fittings, street equipment, steel products, lighting products and timber.

5.6 Civil contractors (for both horizontal and vertical works) are experiencing very tight labour markets, shortage of skilled staff, down time from delivery delays with resulting delays in completion dates and contract claims. Delays for the most basic of materials and infrastructural components (trusses etc) is common.

5.7 The issue is of such a concern that entities such as Waka Kotahi have set up a COVID-19 Claims Taskforce to deal with increasing COVID-19 related costs.

5.8 Increased costs on key major infrastructural projects range from 8% for the Science and Technology stormwater relocation works to 29% for the Airlie stormwater upgrade project. For the current financial year, the estimated additional funding required to deal with COVID-19 increases is estimated at $1 Million and provision for this has been made in the 2020/21 forecasts to deal with this under a COVID-19 allowance budget.

5.9 The effect of this on the overall infrastructure works programme is $69.9M to $70.9M.

6. Looking ahead

6.1 The comments presented below are provided with a “pre-Omicron environment” lens – ie the effects on prices from Omicron are as yet undetermined. The media is however reporting that since Omicron has been detected in the community and the country has now moved to red under the traffic light system that supply chain experts are predicting up to a quarter of the workforce could be off work due to Omicron. The Minister of Finance has also noted that supply chain disruption will be inevitable.

6.2 Officers contacted the Infrastructure Commission who noted that increased prices are a worldwide issue, that there is great uncertainty on prices looking forward, that material costs are transitory and will stabilise (not necessarily reduce), and that labour will remain a major issue for the foreseeable future. They also commented that officers’ approach in thinking about streamlined processes to deal with increased prices and to think ahead as well as initiatives to early order materials is a prudent approach and in line with good strategic thinking.

6.3 Council commissioned BERL to assist officers in determining what the outlook over the next several years would be specifically to see if prices will continue to rise, plateau, or drop. BERL advised that, based on global economic consensus, that markets will calm down and that the current steep price increases experienced to date will reverse in the course of this year, leading to a net Nelson adjusted Local Government Consumer Index (LGCI) increase for CAPEX of 3.4% for July 2021 – June 2022.

6.4 Expected additional costs over and above the budget for the current year, based on further funding request and information to hand, has increased the capital budget by 5.7%. As advised by BERL, the Nelson adjusted LGCI for CAPEX for the 2022/23 year is 3.0%. Officers consider it prudent to account for the 2.7% difference (5.7% less budgeted 3.0% for 2022/23) in next year’s Annual Plan.

6.5 Applying the 2.7% increase across the capital works programme for 2022/23 gives an increase of $1.8M, increasing the overall capital works programme from $67.2M to $69M (excluding vested assets).

7. Challenges in delivery

7.1 Processes and approvals need to be both nimble and dynamic to be able to adjust to the ongoing and ever-changing environment posed by COVID-19.

7.2 The current Council processes to approve tenders and additional funding don’t allow for either a fast or dynamic process. Current Council processes whilst robust, are time dependent (see discussion below) and in the current environment where contractors are unable to hold their prices for a few days/weeks, let alone months, presents a problem in managing budgets. Contractors are reporting product purchase price have price holding periods of anything from 7 hours to 10 days.

7.3 Obtaining approval to award a contract, if additional funding is required under current processes can take between 6 and 12 weeks, post-closing of tenders. This includes the process of having to take a tender to the Tenders Subcommittee (for projects over $2.5M), with support and recommendation for additional funding by the relevant Committee to Council for final approval. This level of delay and subsequent award, results in projects needing to be rephased across further financial years and using contract contingencies not intended for these purposes.

8. Mitigation measures

8.1 To ensure that Council can stay ahead of the current COVID-19 price increases, the following process changes are proposed that will allow officers to be dynamic whilst still ensuring good governance and transparency. These along with Council’s streamlined procurement policy will aid in the delivery of the capital works programme.

Tenders Subcommittee and On-call fund

8.2 Changes to two processes are recommended:

8.2.1 To create an On-call COVID-19 fund of $1.8 Million delegated to the Tenders Subcommittee (for tenders >$2.5 Million) to manage any COVID-19 project related increases as-and-when they arise (officers received a firm preference from elected members at the recent workshop that the Tenders Subcommittee threshold remain at $2.5M) - effective 1 July 2022; and

8.2.2 Amend the Tenders Subcommittee delegations to include the approval of tenders and additional expenditure within the limits of the On-call COVID-19 fund, if required, with reporting of decisions directly to Council – effective 1 July 2022.

Increase budget threshold

8.3 Current project management policy is that if a project is within 5% of budget it is deemed to still be within budget, provided the overspend can be accommodated within the existing activity budgets.

8.4 For tenders below $2.5M that do not have to go to the Tenders Subcommittee, it is suggested that this limit be increased to 10% to give flexibility with price increases during the life of minor projects, provided that any overspend up to the 10% be managed within existing activity budgets.

9. Review and Reporting

9.1 The proposed amendments to current processes are recommended to take effect on 1 July 2022 with a review in 12 months, through a report back to Council by June 2023 to ascertain the success or otherwise of the measures that will allow a decision on whether the streamlined approach should continue, change, or stop.

9.2 It is also recommended that updates on the effectiveness of the new measures be provided to Council via the Audit, Risk and Finance Subcommittee on a quarterly basis.

10. Options

10.1 Whilst the option of not doing anything is an option it is not recommended by officers for the reasons provided below.

10.2 The options as presented in this report, namely the creation of an On-call COVID-19 fund to be managed by the Tenders Subcommittee, delegating approval of tender award to the Tenders Subcommittee, and increasing the budget threshold to 10% could be considered separately, but go together as a suite of options that will allow Council to respond to the challenges of COVID-19. Whilst these options are presented as measures to address the matter in hand, they are by no means measures that will totally mitigate the effects of COVID-19. Officers support the suite of options.

Option 1: Do nothing
Advantages	· None
Risks and Disadvantages	· Inability to deliver the capital works programme · Increased stress on officers, Council’s consultant, and contractors · Works will be delayed and will affect future LTP years · Work will cost more in the long run · Reputational risk of not taking leadership to address COVID-19 issues · Contractors may choose not to compete for future works · Contractors may not be available to complete the works in expected timeframes if tender award is delayed resulting in more carry-overs
Option 2: Approve suite of options to address COVID-19 cost increases
Advantages	· Whilst the measures proposed will not mitigate all the risk completely, they will go towards addressing challenges posed by COVID-19 · Ensures projects can move forward in a timely manner · Decreases the likelihood of further funding required · Increases chance of delivering the capital works programme · Enhanced reputation for addressing the issue
Risks and Disadvantages	· None

11. Conclusion

11.1 Tender prices, as a result of COVID-19, have increased and whilst anticipated to stabilise over the next 12 months, still pose a risk to the successful delivery of the capital works programme.

11.2 Officers have proposed a suite of measures that will provide a degree of mitigation to address increased process resulting from COVID-19, that will hopefully assist in the delivery of the capital works programme – accepting we live in interesting and unpredictable times resulting from COVID-19 - whilst ensuring good governance and transparency.

12. Next Steps

12.1 Provision of $1M will be included in the current 2021/22 forecasts to cater for possible cost fluctuations resulting from COVID-19.

12.2 Provision of $1.8M capital budget has been included in the Draft 2022/23 Annual Plan as part of an On-call COVID-19 fund to deal with possible COVID-19 increases, and if approved by Council this will be formalised.

12.3 Subject to approval of the proposed changes to the Tenders Subcommittee delegations register the amendments will be included in the Delegations Register and will take effect on 1 July 2022.

12.4 Officers have proposed that the Audit, Risk and Finance Subcommittee has oversight of this matter and officers have also proposed a review period of 12 months.

Author: Alec Louverdis, Group Manager Infrastructure

Attachments

Attachment 1: A2827529 - Tenders Subcommittee Delegations ⇩

Important considerations for decision making

1. Fit with Purpose of Local Government

Introducing measures to mitigate COVID-19 impacts and improve prospects for achieving delivery of the capital works programme benefits the environmental, economic, cultural, and social well-being of the community.

2. Consistency with Community Outcomes and Council Policy

The recommendations in this report aim to deliver the capital works programme and each of the projects deliver one or more of the following community outcomes:

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

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

· Our communities are health, safe and resilient

· Our Council provides leadership and foster partnerships, a regional perspective, and community engagement

3. Risk

The risk to the budgets and delivery of the capital programme, from COVID-19 is high. The proposals in the report provide possible mitigation measures to manage (not eliminate) these risks and allow tender award to move forward in a timely manner reducing the risk of delays and further potential cost increases.

4. Financial impact

The proposals in the report provide a financial model via an On-call fund to meet the challenges arising from COVID-19.

5. Degree of significance and level of engagement

The quantum of funding and mitigation measures to address the risks are not deemed significant. All the projects that may be affected financially have been consulted on as part of the LTP and with individual landowners where appropriate.

6. Climate Impact

The impact of climate has already or will be considered as part of the individual projects. The recommendations in this report do not have any impact on climate or emissions reductions.

7. Inclusion of Māori in the decision-making process

No engagement with Māori has been undertaken in preparing this report.

8. Delegations

Whilst the Infrastructure Committee resolved that the matter be brought back to their Committee, the matter and subject of the report is a cross-organisation matter and should be considered by the full Council.

Infringement offence		Infringement fee
1	Any parking offence involving parking on a road in breach of a local authority bylaw, in excess of a period fixed by a meter or otherwise, where the excess time is—
	not more than 30 minutes	$12 or such lesser amount as is fixed by the local authority
	more than 30 minutes but not more than 1 hour	$15 or such lesser amount as is fixed by the local authority
	more than 1 hour but not more than 2 hours	$21 or such lesser amount as is fixed by the local authority
	more than 2 hours but not more than 4 hours	$30 or such lesser amount as is fixed by the local authority
	more than 4 hours but not more than 6 hours	$42 or such lesser amount as is fixed by the local authority
	more than 6 hours	$57 or such lesser amount as is fixed by the local authority

Option 1: Status Quo – Maintain the $3 discount on some time limit parking infringements
Advantages	· Unlikely to receive criticism by those who would otherwise lose the discount.
Risks and Disadvantages	· A separate process remains that the new enforcement system cannot adequately manage. · Cost of manually administering this process continues. · Risk of not applying the discount to all eligible continues. · Being out of step with other councils continues. · Low level of deterrence provided by the infringement fee continues.
Option 2: Remove the $3 discount on some time limit parking infringements (preferred option)
Advantages	· Cost of administering this process is removed. · There are no separate processes required for the new Enforcement Application system. · Ensures we are in step with other councils. · The deterrence provided by the infringement fee is not reduced.
Risks and Disadvantages	· Could receive criticism however this can be managed with appropriate communications.

Option 1: Approve the Council submission (recommended option)
Advantages	· Council’s views will be considered by the Government as it finalises the draft Plan
Risks and Disadvantages	· None obvious
Option 2: Do not approve the Council submission
Advantages	· None obvious
Risks and Disadvantages	· The opportunity for Council’s views to be considered by the Government is lost