Item 6: Deliberations
on the Annual Plan 2023/24 submissions
|
|
Council
25 May 2023
|
REPORT R27506
Deliberations on the
Annual Plan 2023/24 submissions
1. Purpose of Report
1.1 To
deliberate on the submissions received on the Annual Plan 2023/24 Consultation
Document.
2. Summary
2.1 Council
consulted on the Annual Plan 2023/24 Consultation Document, alongside
consultation on the proposed Schedule of Fees and Charges for 2023/24, from 29
March to 30 April 2023. 45 submitters spoke at the hearings on 11 and 12 May
2023.
2.2 Council, having heard
submissions must now consider the matters raised by the community and any new
issues which have arisen that may impact on the Annual Plan.
3. Recommendation
|
That the Council
1. Receives the report Deliberations
on the Annual Plan 2023/24 submissions (R27506) and its attachments (839498445-14453
and 332184083-4780); and
2. Notes that additional savings
of $247,000 have been identified by Council officers in the period since the
Consultation Document was released, enabling funding of the recommended
decisions 3, 4 and 7 below; and
3. Approves amending the proposed
Annual Plan 2023/24 in response to submissions, to provide a 7.2% inflation
adjustment to the Community Investment Fund and organisations identified as
supporting Nelson’s communities of greatest need, at an approximate
cost of $44,000; and
4. Approves amending the
proposed Annual Plan 2023/24 in response to submissions, to provide a 3.5%
inflation adjustment to grants to other community organisations, facilities
and Council Controlled Organisations and Council Organisations, at an
approximate cost of $183,000; and
5. Requests Council officers, in
consultation with the Chief Executive and the Board of the Nelson Regional
Development Agency, to prepare a report taking account of the financial
challenges facing that agency due to the government COVID-19 support
ending in June 2023 and a disparity of funding between Nelson City Council
and Tasman District Council and considering how the agency can be refocussed
and financed into the future; and
6. Delegates to the Deputy Mayor,
Councillor Courtney and Councillor Brand with the support of Group
Manager Community Services, and in consultation with the Nelson
Festivals Trust, the investigation of the degree to which the Trust met its
contractual obligations during the difficulties of COVID-19, the
circumstances that led to the growth in its reserves, and the appropriateness
or otherwise of the Trust using those cash reserves to help partially fund
the 2023 Arts Festival given the acute budgetary pressures on Council and
ratepayers, with the findings of this work to be reported back to Council;
and
7. Approves amending the
proposed Annual Plan 2023/24 in response to submissions, to provide an
increase of funding in 2023/24 to Kotahitanga mō te Taiao Alliance from
$20,000 to $40,000, conditional on Tasman and Marlborough District Councils
resolving likewise;
8. Approves the approach to
Annual Plan 2023/24 submission responses included in the spreadsheet in Attachment
1 (839498445-14453); and
9. Approves the changes to the
proposed Annual 2023/24 resulting from Council decisions, corrections and
timing changes as outlined at sections 5.43 to 5.46 of this report R27506;
and
10. Approves the budget carry forwards as
set out in Attachment 2 (332184083-4780); and
11. Confirms its intent to have an overall
average rates increase of 7.2% in 2023/24.
|
4. Background
4.1 On
23 March 2023 Council adopted the Annual Plan 2023/24 Consultation Document,
having decided to consult due to the significant variations proposed to the
2023/24 work programme as set out in the Long Term Plan 2021-31.
4.2 The consultation for
the Annual Plan Consultation Document 2023/24 and proposed Schedule of Fees and
Charges 2023/24 were run alongside each other for one month, between 29 March
and 30 April 2023. 361 submissions were received on the Annual Plan 2023/24
Consultation Document. 45 people spoke to their submissions at hearings on 11
and 12 May 2023. Submission counts and comments in this report refer to
submissions received and the late submissions which were accepted.
4.3 284 submissions were
made by residents of Nelson, 68 from residents of Tasman and 9 were from people
residing outside the Nelson/Tasman region. 81% of submissions were made online.
A selection of proforma submissions were received, mostly relating to the
Maitahi Bayview Development subdivision (Maitai Valley) and Infrastructure
Acceleration Fund projects.
5. Discussion
5.1 Key topics raised in
submissions and the recommended responses for Council’s consideration are
outlined below. Recommended responses to a range of matters raised by a smaller
number of submitters are contained in the attached spreadsheet (Attachment 1).
Recovery
from the August 2022 severe weather event
5.2 99 submitters
supported funding the net cost of the recovery work over ten years. Reasons
given for support included: spreading the cost to existing ratepayers; ensuring
there is funding for Council core functions to continue; balancing the approach
to make sure it is affordable to residents while responding to climate change.
Many submissions also included support for completing recovery works in ways
that increase resilience to future events.
5.3 13 submitters opposed
this timeframe for the recovery work, with some feedback suggesting paying it
off over a longer period. However, most of those who opposed the timeframe
suggested paying it off over a shorter period to save on borrowing costs or to
mitigate risks of another severe event/s occurring before it is paid off,
particularly since due to climate change increased frequency of events is
likely.
5.4 27 submissions gave a
mixed response. Many submissions in response to this proposal covered a
range of broader matters. Feedback included comments on:
5.4.1 the importance of the recovery
including strategic planning to consider climate adaptation, Regional Climate
Change Risk Assessment (once complete), managed retreat, impacts of future
events, prohibiting future development in high-risk areas, and the effect of an
Alpine Fault rupture
5.4.2 concern with replacing infrastructure
in areas that will be vulnerable to future severe weather events or the impacts
of climate change
5.4.3 concern about using hard engineering
solutions for rivers as part of recovery works
5.4.4 the importance of protecting
macroinvertebrate and fish habitat in the Maitai river when undertaking
recovery works
5.4.5 a view that central government or
insurance companies should fund a greater share of the overall cost.
Staff comment
5.5 Following a review of
the submissions, staff consider that the ten-year repayment period remains the
most appropriate timeframe. Paying off the cost over ten years strikes the
right balance between not imposing immediate excessive costs and not deferring the
costs for so long that there is a high risk of not paying this event off before
the next major event occurs. For instance, paying off the estimated cost evenly
over five years would require a $6.8 million repayment in 2023/24, which would
require an approximate further 5.9% rates increase to a total of 13.1% in
2023/24.
Reduction in spending on new
library
5.6 88 submitters
supported Council’s proposal to reduce spending in 2023/24 on a new
library with common reasons including: the risks associated with a riverside
location (particularly from flooding); the need to thoroughly investigate the
options; support for a central city hub rather than just a library; and that
funding should be prioritised to critical infrastructure and flood recovery.
Submitters also saw this as an opportunity for wider and improved consultation,
and for a more logical proposal being developed.
5.7 32 submitters opposed
the proposal to reduce spending on and delay construction of a new library.
Reasons included: the community needing a new library which should be
prioritised; the library being important to people experiencing hardship;
support for a separate library rather than a community hub; opposition to the
drastic cut in funding; the proposed future funding not being sufficient for a
new library/hub; a desire to see the investigation better funded; support for
the previous proposal and iwi partnership approach; and concern that the hub
will compromise library needs. There was also concern that the project
could drag on for many years.
5.8 14 submitters opposed
allocating any funding. Reasons included: a new library not being needed or
seen as a luxury in the current economic environment; that a community hub is
not required; and that the level of expenditure to do the investigation is too
high.
5.9 24 submitters provided
mixed responses. Comments included: wanting to see a civic centre included in
the scope; wanting a new library undertaken in conjunction with Tasman District
Council; a preference for several satellite libraries as well as a smaller
central library; preference for a youth centre; wanting to see the funding
redirected to existing community groups; consideration of other locations (e.g.
museum); and saving money now is of no real interest on a project with a 50
year return.
Staff comment
5.10 Following consideration of the
submissions, staff recommend no changes to the proposal as set out in the
Consultation Document. Submissions were generally supportive, and the move will
find favour with both those who were concerned about the size of the budget and
those concerned about the riverside location. It is prudent for Council to
continue working on an alternative approach as The Elma Turner Library is
nearing the end of its optimal life.
5.11 This approach is consistent with
the decision to strengthen the existing library and will allow further
opportunity for community engagement on the project and the scope of what is
needed. The $200,000 expenditure in 2023/24 will help develop a greater
understanding about suitable sites and community expectations for the community
hub development, including a new library.
Infrastructure Acceleration Fund –
infrastructure upgrade to unlock city centre living
5.12 114 submitters supported
accelerating infrastructure upgrades in the city centre to enable central city
living and to receive central government funding. Common reasons submitters
supported the proposal included: support for making a vibrant city centre;
making the area more accessible and people friendly; the transport benefits and
improved safety; increasing intensification to avoid urban sprawl; affordable
housing; and leveraging central government funding.
5.13 Some submitters identified
matters that they wanted considered in the project or when subsequent city centre
development enabled by the work takes place. The matters included mitigating
disruptions to business caused by the project, good urban design and green
spaces for residents/users, accessibility, mitigating climate impacts and
natural hazards, and managing how a larger number of city centre residents
would coexist with ‘nightlife’ businesses.
5.14 52 submitters opposed this
proposed change. Reasons for opposition included: that developers should pay
for this type of infrastructure upgrade; that funds should not be spent on
upgrades in a cost of living crisis; lack of support for the Bridge Street
Linear Active Transport Corridor concept; opposition to the loss of any car
parking; concern about the purchase of the bus depot site; concern about high
emissions likely in the developments enabled; opposition to central city living
in general; and concern that intensification could make the central city unsafe
at night.
5.15 There were 30 submissions that
gave a mixed response. Some gave conditional support only in certain
circumstances. For instance, only upgrade if known repairs required, only if a
Three Waters entity is implemented that would help fund the work, only instead
of the Maitahi-Bayview Development progressing, or only if housing enabled was
for older or younger people.
Staff comments
5.16 Staff recommend bringing forward
funding for 2023/24 to initiate the city centre infrastructure upgrade project,
as proposed in the Consultation Document. Prioritising budget for this work is
an appropriate investment for the future and delivers good value for ratepayers
as Council can leverage substantial Central Government funding. The growth
portion of the projects will be collected via development contributions as per
Council’s policy. Accelerated three water upgrades will also have
benefits for the wider Nelson catchment.
5.17 If budget is approved, staff will
consider specific matters raised in submissions at the appropriate planning and
project stages. Future communication and engagement with potentially affected
business owners is a priority and the works are to be managed with the aim of
minimising disruption The approach for delivery of these works will be based on
a dig once approach. At this stage, it is intended that the Haven Road Upgrade
(Bridge – Rutherford) and the Bridge Street Upgrade (Rutherford –
Collingwood) including three waters infrastructure will be delivered in one
package however staged to consider the needs and impacts to the
businesses/wider community. Design for the corridor has yet to be undertaken,
and the comments in relation to parking, climate change and natural hazards,
green spaces and good urban design provided from submitters will be considered
as part of that process from 1 July 2023 onwards.
Maitahi Bayview Development subdivision
(Maitai Valley) utilities and transport connections
5.18 140 submitters supported the
proposal in the Consultation Document to allocate $606,000 of funding in
2023/24 to undertake pre-planning work on the utility and transport connections
to the proposed Maitahi Bayview Development subdivision (Maitai Valley). Reasons
submitters supported the proposal included: support for development and the
residential housing growth opportunities it provides near the central city;
reduced urban sprawl onto the Waimea Plains; it is responsible to prepare for
the possibility of construction starting; and Council co-ordination of
development will lead to better community outcomes.
5.19 122 submitters opposed the
proposal for reasons including: not supporting the proposed development due to
its detrimental impact on the Maitai River, wetlands, wildlife, amenity
of the area, and neighbouring properties; community opposition to the plan
change and subdivision; opposition to rates funding/subsidising infrastructure
by a private developer; potential flooding in the area and for properties
downstream; the development area being slip prone; increased traffic on Nile
Street and Maitai Road making them dangerous; development providing the wrong
type of housing; disruption from development; ongoing maintenance costs from
the development; development increasing urban sprawl; there being ample
sections available in Nelson already; a looming recession; and that the land
should be turned into a regional park.
5.20 21 submitters gave mixed
responses to the proposal. Reasons for this view were that support depended on
the quality of urban design and the resulting built form; support if the
traffic problems on Nile Street/Maitai Road and Clouston bridge were addressed;
lower portion of the valley should be for flood detention; and only support if work
happens after the outcome of the appeal.
Staff comments
5.21 Staff recommend no changes to the
funding proposal as set out in the Consultation Document. Most of the
submissions either in support or opposition relate to the subdivision proposal
and whether it should proceed. These matters are outside of the scope of the
Annual Plan proposal, were dealt with under the plan change, and will be
subject to the outcome of the appeal to the Environment Court.
5.22 The matter for consideration
through the Annual Plan process relates to whether Council should provide
funding for the infrastructure pre-planning work. Some submissions were of the
view that the developer should pay 100% of the cost. Other submitters supported
provision of funding to enable the pre-planning work to proceed.
5.23 This pre-planning work will
enable Council to improve its understanding of the infrastructure needs and
associated costs of the work (for consideration in the Long Term Plan
2024-2034), and the cost split between the developer and Council. The
developer will be responsible for servicing their proposed development.
However, there are some services (external to the development) which Council
will need to ensure are upgraded. There will be benefits to nearby areas of the
city due to these upgrades and the Maitahi Bayview developer would not be
expected to cover that portion of the cost.
Funding for external grants at 2022/23
levels
5.24 Council proposed to hold 2023/24
funding for a range of external grants at the same level as 2022/23. This
included funding to community groups, facilities,
Council Organisations and Council Controlled Organisations. 25 submitters
provided specific feedback in opposition to this proposal. Reasons included:
negative impact on arts/culture/creative sector; reduction in opportunity for
social cohesion and resilience; community organisations will need to make cuts
which will impact services, projects and events for the community; community
facilities (such as Nelson Centre of Musical Arts and Theatre Royal) that
provide benefits to the community will be negatively impacted while still
recovering from the impacts of COVID-19.
5.25 A number of Council Controlled Organisations
submitted about the negative impact the move would have for their services and
ability to deliver outcomes to the community. The Suter highlighted the
compounding impact as it was still recovering from COVID-19 and the severe
weather event. The Nelson Regional Development Agency highlighted the
importance of economic development investment in times of economic challenge
and its ability to leverage funding from central government and the private
sector. The Tasman Bays Heritage Trust formally requested a 5% CPI (Consumers
price index) adjustment for the Nelson Provincial Museum.
Staff comments
5.26 Council values and continues to
support the organisations impacted by this proposal. However, their funding
does need to be considered in light of the cost of living crisis facing
ratepayers and households. It is a difficult trade off to make in the current
economic circumstances. If the proposal was reversed and a CPI adjustment
applied, an extra $476,000 in rates revenue or an approximate further 0.5%
rates increase would be necessary. Council may wish to consider applying some
increase but not the full CPI adjustment and/or prioritising organisations
supporting Nelson’s communities of greatest need. Staff have found
further savings since the release of the Consultation Document which would
allow a 7.2% increase for the Community Investment Fund and organisations
supporting the most vulnerable members of the community as well as a partial
increase for other grants.
5.27 The Nelson Regional Development Agency
is in a difficult position with Central Government destination management
funding ending in June and the ongoing challenge of a mismatch in regional
funding from councils. Council may wish to see more work done on how to
prioritise the work programme of the agency and find a sustainable funding
pathway.
Arts Festival funding
5.28 7 submitters, including the
Nelson Festivals Trust, provided specific feedback in opposition to the
proposed change to funding for the Arts Festival in 2023/24. The proposed
change would involve funding to the Nelson Festivals Trust of $409,000 with the
remaining $175,000 that Council would have contributed to come from reserves
built up over recent years. Feedback included: the Trust has used all Council
funding provided in COVID-19 disrupted years to deliver the festival –
not to add to its reserves; the decrease will have a cumulative effect when
combined with no adjustment for inflation; the Trust intends to use some of its
reserves in 2023 and 2024 to build up long-term sustainability of the
organisation – this would mean the 2023 and 2024 festivals would require
cuts to programming (especially free community events); less Council funding
could jeopardise alternative funding streams or the Trust’s financial position;
and the importance of promoting arts and culture in the region.
Staff comments
5.29 Council has supported the
festival over the course of its life and intends to continue to support the
festival to grow. The funding proposal was developed by Council staff on the
understanding the Trust has sufficient funds in its reserve and keeping the
Nelson Festivals Trust as it was prepared.
5.30 However, the Trust in its
submission and at the hearings expressed concerns about the requirement to use
some of its reserves as part of core funding for the 2023 festival. Given the
concerns and the lack of clarity about how the current situation arose, one
option would be for a small group of councillors to work with staff, and in
consultation with the Trust, to look into the issues that have been raised and
return to Council with a recommended way forward. In the meantime, staff
recommend that the funding for the Festival remain as proposed.
Funding for arts hub
investigation
5.31 One submitter supported the
proposed change to investigate opportunities for a new arts hub to support the
arts sector and implementation of He Tātai Whetū – Whakatū
Nelson Arts and Creativity Strategy. Their feedback was that there should be
consideration given to repurposing an existing building. A submission also
suggested that work should be progressed more quickly than an investigation.
Four submitters opposed the proposed change and reasons included: the cost of
doing the investigation; preference that funding to existing arts facilities be
increased; that it is a ‘nice to have’ project; and a query whether
private sector should provide entertainment instead.
Staff comments
5.32 Staff recommend no change to the
$100,000 allocation to progress the investigation. Council analysis of
community arts facilities has identified potential gaps for Nelson and the
investigation will provide greater understanding of any shortfall and what arts
facilities are required. Commencing the investigation in 2023/24 is recommended
because it is prudent to undertake preliminary work in the short term before
committing any capital funding through the Long Term Plan 2024-2034 for
projects of this nature that have long lead times.
Tāhunanui Surf
Lifesaving and Sports Facility(ies)
5.33 9 submitters supported the
proposed change to investigate opportunities for the development of a surf
lifesaving and sport facility/facilities. Reasons included: investigations will
provide a fit-for-purpose evaluation; a facility would better support Surf Life
Saving Club members and make Tāhunanui beach safer; support for a shared
sporting facility for a mix of codes; Tāhunanui needs more good
infrastructure with community focus. Feedback also suggested that due to
projected sea level rise any new building should be relocatable. Two submitters
opposed the proposed change due to the cost of the investigation or that it was
a ‘nice to have’ project.
Staff comments
5.34 Staff recommend no change to the
$100,000 allocation to progress the investigation. Undertaking this work will
allow an informed decision by Council of whether to proceed and the likely
costs of a development. Sea level rise and the eastern migration of the Waimea
Channel will be considered in the investigation.
Kotahitanga mō te
Taiao Alliance funding
5.35 Two submissions suggested
increased funding for the Kotahitanga mō te Taiao Alliance – the
alliance requested an increase from $20,000 to $40,000 in 2023/24.
Feedback included: the alliance addresses the significant conservation problem of
a lack of a coordinated approach to conservation; additional funding would
enable focus on critical fundraising for landscape projects of a similar size
or larger to existing Jobs for Nature projects; and that the alliance’s
work will result in ongoing benefits to biodiversity and climate resilience,
improved connection to nature through educational work, and conservation
training and opportunities.
Staff comments
5.36 Council supports the efforts of
Kotahitanga mō te Taiao Alliance and recognises the benefits of their work
to Nelson and Te Tauihu region. The alliance has also requested the same level
of increase in funding from Marlborough and Tasman District Councils. Staff
recommend increasing funding from $20,000 to $40,000, conditional on Tasman and
Marlborough District Councils also increasing their support to $40,000.
Climate Change
5.37 12 submissions were received
specifically on climate change. Feedback covered matters broader than the
proposed changes for the Annual Plan, with the majority of feedback supporting
stronger action on climate change. Feedback included: that more urgency in
Council’s response to the climate crisis is needed; that Council should
carefully apply a climate lens to all work programmes; that Council and Tasman
District Council should align their climate strategies and plans; that Council
should support wider community behaviour change; that climate analysis on
proposed changes should have been included; that the cost versus Nelson’s
contribution to emissions needed to be balanced; and support for
Council’s Te Mahere Mahi a te Āhuarangi Climate Action Plan and Climate
Change Strategy.
Staff comments
5.38 Feedback raised in these
submissions would be more appropriately considered in the development of the
next Long Term Plan, e.g. the suggestion to make climate change a Long Term
Plan priority. Staff will take into account submitters’ feedback in
preparation of the Long Term Plan and will encourage submitters to provide
their views when Council engages on that plan.
Transport
5.39 27 submissions were received
related to Transport activity broadly and specific transport projects. Specific
feedback on transport projects or changes identified in the Consultation
Document included: opposition to deferring expenditure on public transport
related to the design of the new bus hub for Millers Acre; support for the
Streets for People projects; and support for the Transport Choices projects.
5.40 Broader transport-related
feedback included support of active and public transport or requests that it be
progressed more urgently (such as bus lanes or more commuter cycle trails) for
safety and emissions reduction. Other feedback included: concern about using
funds to pay for cycleways; queries about the bus service and subsidisation
levels for bus passengers; support for the Southern Link; doubt that priority
lanes would be effective; concern with current links between inner city and
Tāhunanui and the Nelson Future Access Project; that car parking should be
limited to encourage behaviour change; more should be done with services to
North Nelson; a request for support for the installation of Locky Docks which
allow charging of ebikes; and a request to progress a cycle/walking track from
the Wakapuaka sandflats to The Glen.
Staff comments
5.41 Staff recommend no change to the
proposals for public transport, Streets for People projects and the Transport
Choices projects as outlined in the Consultation document. Staff see merit in investigating
the Locky Docks proposal and will initiate contact with Big Street Bikers to
see how this can be moved forward. In 2023/24 a number of projects are planned
to improve safety at key intersections around Nelson, create separated
cycleways, and improve public transport services which will help address many
of the matters raised in feedback. Other matters, such as bus priority lanes,
will be considered with the development of the next long term plan rather than
next financial year.
Other matters raised in
submissions
5.42 A range of other matters were
raised by a smaller numbers of submitters. Staff have developed recommended
responses to these specific matters for Council’s consideration in
Attachment 1. The attachment summarises the suggested responses for all matters
identified as not requiring changes to what was proposed or that can be
accommodated in existing work programmes. Any matters where staff are
recommending changes to what was proposed in the consultation material are
covered in the body of this report.
Other changes since the
Annual Plan 2023/24 consultation
5.43 Staff have identified some other
changes required to the final Annual Plan 2023/24 relating to Council
decisions, corrections and timing changes from what included in the Annual Plan
2023/24 Consultation Document and supporting information.
5.44 Aside from any new changes that
might be agreed on through these deliberations, the carry forward of capital
expenditure budgets as referenced in 5.46 and the other changes referenced in
5.41 have already caused some changes to the net debt and rates requirement.
There are numerous small adjustments that mostly nett off, for example, the capital
expenditure carry forwards do not increase overall debt level, just the timing
of when debt is incurred. The major changes are summarised below.
5.45 Net debt
is projected to increase by an additional $8.3 million to $207.9 million at
June 2024. The major contributors to changes in debt are:
· 41 Halifax
Purchase – $970,000 increase to debt
· 41 Halifax
deconstruction and reinstatement to pavement – $800,000 increase to debt
· August
2022 severe weather event recovery, slip remediation 2022/23-2023/24 –
$8.2 million increase to debt
· Increase in severe
weather event recovery forecast costs 2022/23 – $3.1 million increase to
debt
· Saxton Stage 4,
additional costs due to May 2023 flooding - $500,000 increase to debt
· Increase scope adjustment
from 10% to 15% - $4.4 million reduction to debt.
5.46 The rates
requirement for 2023/24 has decreased by approximately $247,000. The major
contributors to this change are:
· Visitor
Information Service – Council approved an additional $110,000 after the
Consultation Document was released, this has now reduced to an $84,000
increased rates requirement
· Welcoming
Communities Programme Project funding – $20,000 increased rates
requirement (project funding introduced for Annual Plan 2022/23 not included
the Annual Plan 2023/24 Consultation Document)
· Interest income
from Nelson Tasman Regional Landfill Business Unit (NTRLBU) previously omitted
by error – $262,000 reduction in rates requirement
· Reduction in
expected external interest due to carry forwards and rise of scope adjustments
to 15% - $113,000 reduction in rates requirement
· Correction of
other small errors - $24,000 increased rates requirement.
Carry Forwards
5.47 Staff have reforecast the current
year capital spend to 30 June 2023. The projected capital forecast is $61.9
million excluding staff time, joint business units, vested assets and August
2022 severe weather event recovery budgets, with savings of $3.2 million.
Capital carry forwards requested of $21.9 million are spread across years 3 - 4
of the Long Term Plan 2021-2031 and are included in Attachment 2 for approval.
$8.3 million of these carry forwards were incorporated in the budgets contained
in the Consultation Document and supporting information. Changes to scope
adjustment are included in the forecast total but excluded from savings and
carry forward totals.
5.48 $18.9 million of the carry
forwards are into the 2023/24 year and are included in the $60.3 million
capital programme for 2023/24 (excluding staff time, joint business units,
vested assets and August 2022 severe weather event recovery budgets). Staff
have considered the impact of the carry forwards and recovery on the
deliverability of capital expenditure for 2023/24 and due to a number of
factors, including external funding, cannot identify projects to defer.
Therefore, the scope adjustment has moved from 10% to 15% recognising the
challenge of delivery. Including the capitalised weather event budgets changes
the capital programme for 2023/24 from $60.3 million to $77 million (excluding
staff time, joint business units, vested assets and after 15% scope
adjustment).
Overall rates approach for
Annual Plan
5.49 87 submitters supported the steps
taken to minimise the rates rise to an average of 7.2%. The main reasons
included: the approach being a good attempt to strike the right balance between
minimising impact on the community and delivering council services; the
approach being reasonable in the economic circumstances; and it being necessary
to maintain services.
5.50 31 submitters opposed the
proposed approach. The large majority of them preferred no, or lower, rates
rises. Feedback included: concerns that households will not be able to afford
rates increases in a cost of living crisis; rates having already increased
considerably; ratepayers’ wages will not increase by the rate of
inflation; further reductions should be found (e.g. in ‘non-core
areas’); basing rates on land value was unfair (particularly for
ratepayers that may be lower consumers of Council services); that users of
Council services should pay for the full cost of the service rather than
ratepayers; and that rates should be higher to pay for essential
infrastructure, implement Te Ara ō Whakatū plan more quickly, or
funding to community groups.
5.51 There
were also 30 mixed response submissions. Feedback included supporting the
intent but not the steps taken to minimise the rates increase; supporting the
steps but feeling the rates increase is still too high; concern that trimming
maintenance budgets could mean assets are not maintained or create more cost
long term; concern whether funding will be sufficient for infrastructure
development or important community facilities; and that the uniform annual
general charge should be higher. Some submitters identified matters they wanted
considered in the rating approach of introducing rates discounts to single
occupancy homes or increasing rebate thresholds; that lifestyle block owners
who commute to work and benefit from Council services should not have lower
rates increases than residential ratepayers; and that a large reduction in
operational spending long term will be detrimental.
5.52 Six submitters opposed the
proposal to keep the commercial differential at the 2022/23 level instead of
decreasing it by 0.5%. Feedback from those who opposed included: that
paying commercial differentials are unfair on commercial users compared to
residential ratepayers; that not decreasing the differential was an unjustified
change from what was adopted in the Long Term Plan; that businesses are relying
on the decrease in the differential next year; and the impact on small
businesses and their profitability.
Staff comments
5.53 Staff recommend the average rates
rise of 7.2% in 2023/24 as outlined in the Consultation Document. Council
recognises the impact the cost of living crisis is having on the community and
has avoided adding to inflationary pressures by raising rates above inflation.
Equally a further reduction in rates revenue would negatively impact the delivery
of Council’s work programme and the services provided to the community.
It is acknowledged, however, that the steps outlined in the Consultation
Document to manage budgets will result in some difficult trade-offs in the
2023/24 year and beyond.
5.54 The commercial differential
recognises the additional services that businesses receive, such as extra
rubbish collection, street sweeping and events to attract visitors. Following
consideration of the submissions, staff recommend keeping the commercial differential
at the 2022/23 level as proposed. It will strike a suitable balance between
commercial and residential ratepayers in the context of the cost of living
increases impacting the community and spread the rates rise percentage increase
more evenly. The Long Term Plan had also been clear that the decision to reduce
the commercial differential by 0.5% would be considered annually.
6. Options
6.1 Council has options
for each decision it makes in relation to submissions, including making no
changes from what was proposed in the Consultation Document, increasing or
decreasing funding, or approving new funding. Each decision will have rating or
debt implications that will feed into the final Annual Plan. Council is
required to adopt an Annual Plan for 2023/24 by 30 June 2023 so that it can
strike the rates for that financial year and have in place a work programme
ready to commence on 1 July.
7. Next steps
7.1 Staff will incorporate
the Council’s deliberations decisions into the Annual Plan 2023/24, prior
to bringing it back to Council on 22 June 2023 for adoption and striking the
rates. Following adoption final versions of the document will be published on
Council’s websites and made available to the public.
Co-Author:
Nicky McDonald,
Group Manager Strategy and Communications
Co-Author: Nikki
Harrison, Group Manager Corporate Services
Attachments
Attachment 1: 839498445-14453 -
Approach to Annual Plan 2023/24 submissions responses ⇩
Attachment 2: 332184083-4780
- Capital budget carry forwards ⇩
|
Important considerations for decision making
|
|
Fit with Purpose of Local Government
The submissions on the Consultation Document are an input
into Council’s decision making processes. They enable elected
members to have an understanding on community views on the matters prior to
Council deliberating and making decisions on what is included in the Annual
Plan 2023/24.
The consultation processes enable Council to democratically
make decisions on behalf of its communities, and to consider its services,
work programme and budgets in terms of the wellbeing of its community in the
present and for the future.
|
|
Consistency with Community Outcomes and Council Policy
The proposed changes to
Council’s work programme as set out in the Consultation Document were
considered to more appropriately align available resources to achieve its
community outcomes compared to year three of the Long Term Plan 2021-31. The
proposals recommended through this deliberations report have been made
following consideration of community feedback and will help work towards
Council’s community outcomes.
|
|
Risk
Consultation has been carried out to determine the
community’s views on the services, work programme and budgets for the
Annual Plan 2023/24. Deliberating on the matters raised in submissions
is considered low risk, as Council is following the correct process.
There is a risk that Council will make decisions
as part of the deliberations that are not supported by some stakeholders,
however, Council can communicate the reasons for the decisions through the
response letters to submitters and communications to the community, which
will help mitigate this risk.
|
|
Financial impact
The decisions Council makes on
the submissions will determine the financial impact for the Annual Plan.
|
|
Degree of
significance and level of engagement
The proposals in the
Consultation Document have been assessed against Council’s Significance
and Engagement Policy as having a high degree of significance (refer to
report R27506 to 9 February Council meeting). The consultation process
undertaken reflects the high degree of significance of the decisions.
|
|
Climate Impact
The decisions in this report
will impact on the ability of Council to proactively respond to the impacts
of climate change now or in the future. Council’s proposal to complete
recovery work in ways that make the city’s infrastructure more
resilient and help reduce impact from future similar weather events reflects
a climate impacts-focused response. The consultation process has allowed the
community to provide feedback on Council’s climate response activities
as summarised in the report above. Council will continue to focus on its
climate response and will consider climate change prioritisation and budgets
in the development of the next Long Term Plan.
|
|
Inclusion of
Māori in the decision making process
No engagement with Māori has been undertaken
in preparing this report.
|
|
· Delegations
This is a matter for Council.
|
Item 7: Deliberations
on the Schedule of Fees and Charges 2023/24
|
|
Council
25 May 2023
|
REPORT R27671
Deliberations on the
Schedule of Fees and Charges 2023/24
1. Purpose of Report
1.1 To deliberate on the
submissions received on the proposed changes to the Schedule of Fees and
Charges for 2023/24.
2. Summary
2.1 Council consulted on proposed
changes to the Schedule of Fees and Charges for 2023/24 alongside consultation
on the Annual Plan 2023/24 Consultation Document from 29 March to 30 April
2023. Forty-eight submissions were received, and five submitters spoke at the
hearings on 11 and 12 May 2023.
Council, having heard
submissions, must now consider the matters raised by the community and any new
issues which have arisen that may impact on the Schedule of Fees and Charges.
3. Recommendation
|
That the Council
1. Receives the report Deliberations
on the Schedule of Fees and Charges 2023/24 (R27671) and its attachments (1598046314-107);
and
2. Approves increasing the
Annual Pile Mooring fee by 7.2% for 2023/24; and
3. Confirms the approach to
adopting the changes to the Schedule of Fees and Charges for 2023/24, as
contained in Attachment 1 (1598046314-107).
|
4. Background
4.1 Council’s fees
and charges for 2023/24 have been reviewed and most are increasing by the
Consumer Price Index (CPI) of 7.2% which is within the Chief Executive’s
delegation to approve. On 9 February 2023, Council adopted a Statement of Proposal
for changes to the Schedule of Fees and Charges for 2023/24 that required
consultation. The proposed Schedule that went out for consultation is contained
in Attachment 1.
4.2 The consultation for
proposed changes to the Schedule of Fees and Charges and the Annual Plan
Consultation Document 2023/24 were run alongside each other for one month,
between 29 March and 30 April 2023. Of the 48 submissions received on the
proposed Schedule of Fees and Charges, 47 submissions were made by residents of
Nelson, 0 from residents of Tasman and 1 was from a person residing outside the
Nelson/Tasman region. 100% of submissions were made online. Five people spoke
to their submissions at the hearings on 11 and 12 May 2023.
5. Discussion
5.1 Key topics raised in
submissions and the recommended responses for Council’s consideration are
outlined below.
General
feedback
5.2 Some of the
submissions were generally supportive of the proposed changes, with comments
that the proposals seemed reasonable and agreed the majority of the fees and
charges should be covered by those receiving the benefit. Some submitters
disagreed with proposing any increases above CPI and asked Council to be
conscious of the current state of the economy and the ongoing financial impacts
of the August 2022 severe weather event. One submitter also suggested more
assistance for those eligible for rates rebates.
Charges under the Resource
Management Act 1991
Resource consents processing
and monitoring hourly charge out rate
5.3 Four submissions were
received on the proposals for administration of resource consents and other
activities. One submitter suggested any new subdivisions be fast-tracked and
the red tape removed. Another submitter’s view was that Council needed to
employ or train more planning staff to reduce the reliance on outsourcing work
to consultants.
5.4 One of the submissions
was made on behalf of a farming organisation and noted that many activities
farmers seek resource consents for are proposed to increase. While generally supportive
of a user-pays regime, their view was that it should be put in the context of
the many aspects of farming activity becoming more regulated and requiring
resource consents. An approach was suggested where Council recovered consent
costs from its ability to levy additional charges for actual and reasonable
costs on each consent application. This would give applicants an opportunity to
scrutinise the costs and ensure they represented fair fees for farming
activities.
5.5 The same submission
also opposed the proposed increase to the hourly charge-out rate, with comments
that one of Council’s reasons for the proposed increase, outlined in the
Statement of Proposal, that 40% of staff time is not chargeable to resource
consent applicants, was inequitable and not transparent. It was suggested that
Council revise the resource management charges to reflect the expertise and
time spent processing each resource consent application.
Environmental monitoring and
science charge
5.6 One submission opposed
the proposal to remove the charge for discharge to land or water of less than
20m3 per day.
Staff comment
5.7 Following
consideration of the submissions, staff recommend increasing the fees under the
Resource Management Act as proposed in the Statement of Proposal. The proposed
increase of 16% for resource consent processing and monitoring hourly charge-out
rate would improve the recovery rate from applicants and consent holders and reduce the requirement on rates.
5.8 The environmental
monitoring and science charge has a minimal effect on the income used to offset
the cost of the environmental monitoring and science activity and the income received
is less than the cost of administration. Therefore, staff recommend revoking
the charge.
5.9 In response to the
submitter’s comment on fast-tracking sub-divisions and removing red tape,
staff note that the current priority is the processing of consents for the
recovery from the August 2022 severe weather event. All other consents are
processed as quicky as possible while ensuring appropriate assessments are
undertaken.
5.10 In response to the
submitter’s comment on Council employing or training more planning staff,
there is a nation-wide shortage of planners, so without the internal capacity,
Council will continue to need to engage external consultants to assist with
processing consent applications.
5.11 In
response to the submission on resource consents for farming activities, staff
are proposing the increase of 16% to recover up to 50% of the total costs of
providing the resource consents services, as the current fees and charges would
only recover 31% of expected costs.
Fees
and charges under the Navigation Safety Bylaw
5.12 Seventeen submissions were
received on the proposed amendments to fees and charges under the Navigation
Safety Bylaw. Some were in support of the changes, but many were opposed, with
general feedback asking that the fees not be increased above CPI. Some feedback
commented that the proposed increases did not reflect improvements in the
services provided by the Nelson Marina.
5.13 One submitter asked that Council
reduce the marina and hardstand expenditure and suggested using the boat
valuation to set fees for permanent moored boats, as is done with properties,
or to have a higher per metre fee as the boat size increases.
Staff comment
5.14 Staff acknowledge the difficult
financial climate for many, including those who use the Nelson Marina services.
However, the Marina is a business which is also facing increased costs. Staff
have focussed on increasing efficiencies and decreasing overheads, but fixed
costs, such as power, insurance and interest rates, continue to increase. The
fees proposed to increase over CPI are for areas where staff have assessed that
a greater proportion of costs ultimately need to be passed on to those using
the service.
Annual licence fee for marina
berths, pile berths, commercial berths and live aboard fees
Feedback opposed the proposed
increases in annual licence fees, commenting that increases could make it
unaffordable for those who are on low to average incomes and noted that Nelson
wages, and the value of boats in the Nelson Marina, are lower compared to other
cities. Because of these factors, many did not think there should be an
increase over CPI.
5.15 One submitter agreed with most of
the amendments but disagreed with increasing the live aboard fee by 10%,
suggesting reducing it to a 5% increase to reflect the security and general
sense of community those who live aboard provide to the Marina.
Staff comment
5.16 Following
consideration of the above feedback, staff recommend only increasing the
“Annual Licence Pile Mooring” fee by 7.2%, as opposed to the 10%
increase proposed in the Statement of Proposal. With the strong feedback that a
10% increase would likely not be feasible for many who currently pay this fee,
as they are on low incomes, staff see an increase by CPI as a reasonable adjustment
to the original proposal.
5.17 Staff recommend increasing the
live aboard fees by 10% as proposed in the Statement of Proposal, which would
allow the Marina to keep up with the inflation over the previous two financial
years.
Visitor rate
5.18 Submitters noted the value
visiting boats bring to the Nelson economy. Although feedback didn’t
specifically comment on the proposed 20% increase in visitor rate fees, one
submitter suggested a longer-term visitor rate be established, based on a price
per month rather than a daily or weekly fee. Another submitter suggested
discounts be given to visiting boats that stay longer than a week or month or
for yachts where nobody lives aboard.
Staff comment
5.19 Following consideration of the
submissions, staff recommend increasing the berth fee visitor rate by 20%, as
proposed in the Statement of Proposal. In response to the suggestion of a
longer-term visitor rate, Council currently assesses applications for an
extension over three months during the winter period.
Public boat ramp fee
5.20 Feedback on the public boat ramp
fee supported the proposed increase as a fair reflection of the services and
facilities provided, with one submitter suggesting a bigger increase to better
reflect the true recovery of the cost of the service.
Staff comment
5.21 Following consideration of the
submissions, staff recommend changing the public boat ramp fee as proposed in
the Statement of Proposal. Although submitters commented that this was a minor
increase, it is recommended that Council sticks with incrementally increasing
the fee to $15 over the next few years, rather than a one-off substantial
increase.
Fees and charges for burials
and cremation activities under the Urban Environments Bylaw
5.22 One submission was received on
the proposed 20% increase to fees and charges for both cemetery and crematorium
activities, which includes plots, internments, cremation and chapel hire. The
submitter opposed increasing burial plot and burial interment fees for adults
and children, commenting that with funeral costs increasing these fees should
remain at the existing rate.
Staff comment
5.23 Following consideration of the
above submission, staff recommend increasing the burials and crematorium fees
by 20% as proposed in the Statement of Proposal. While staff acknowledge the
community is seeing increased costs across many sectors, including funeral
costs, a 20% increase would bring cost recovery closer to the targets outlined
in Council's Revenue and Financing Policy and ensure a disproportionate burden
did not fall on ratepayers.
Fees
under the Food Act 2014
5.24 Five submissions were received on
fees under the Food Act 2014, and all of these opposed the increase. Feedback
included comments that the proposed fees were too high, particularly for small
businesses, and that the increase was not justified and should be capped at
7.2%.
5.25 One submitter opposed the
increase to the “amendment to registration” fee, stating they had
been charged $85 to change their address details and that the cost was not
justified, particularly for those who only do food vending part time and do not
have high paying regular jobs. The same submitter also opposed the increase in
the “registration food control plan” fee, arguing that for a small
business it was already very hard to absorb those costs.
5.26 The same submitter suggested
making the fees low so complying didn’t come at such a high cost and for
making sure fees were clear and transparent so vendors knew what to expect and
could plan accordingly.
Staff comment
5.27 Following consideration of the
submissions, staff recommend increasing the fees under the Food Act 2014, as
proposed in the Statement of Proposal. Staff acknowledge the challenges the
hospitality sector has faced with the disruptions of COVID-19. However, the
proposed increases are still assessed as improving the current allocation of
costs between food business owners and ratepayers and that the fees would
better cover the actual costs for the service.
Fees under the Building Act
2004
5.28 One submission on the proposed
changes to fees under the Building Act 2004 noted that the cost of building has
increased substantially and would like to see a “cost of building
CPI” raise in the brackets applied every three years.
Staff comment
5.29 After consideration of the above
submission, staff recommend changing the fees under the Building Act 2004 as
proposed in the Statement of Proposal. The fees for 2022/23 were increased by
CPI, but staff consider the proposed fees for 2023/24 more fairly reflect the
actual costs incurred by Council in line with the Council’s Revenue and
Financing Policy and that more costs sit with the building consent applicant
than on ratepayers.
6. Options
6.1 Council has options
for each decision it makes in relation to submissions, including making no
changes to what was in the Statement of Proposal, increasing or decreasing
fees, or removing fees. Each decision will have implications for projected
income and feedback into rating implications for the final Annual Plan.
7. Next Steps
7.1 Staff will incorporate
the Council’s deliberations decisions into the Schedule of Fees and
Charges for 2023/24, prior to bringing it back to Council on 22 June 2023 for
adoption. Following adoption final versions of the schedule will be published
on Council’s websites and made available to the public by 1 July 2023.
Author: Ailish
Neyland, Policy Adviser
Authoriser: Dennis
Bush-King, Group Manager Environmental Management
Attachments
Attachment 1: 1598046314-107 -
Proposed changes to the Schedule of Fees and Charges 2023/24 ⇩
|
Important considerations for decision making
|
|
Fit with Purpose of Local Government
The submissions on the Statement of Proposal are
an input into Council’s decision making processes. They enable
elected members to have an understanding of community views on the matters
prior to Council deliberating and making decisions on the Schedule of Fees
and Charges for 2023/24.
The recommendations in this report assist to
better allocate the cost of delivering services between users and ratepayers,
helping to promote social, economic, environmental, and cultural
wellbeing of communities in the present and for the future.
|
|
Consistency with Community Outcomes
and Council Policy
The recommended changes to fees and charges
assists with achieving the stated funding outcomes in the Long Term Plan, and
are aligned with the following community outcomes:
• Our
unique natural environment is healthy and protected
• Our
infrastructure is efficient, cost-effective and meets current and future
needs
• Our
communities have access to a range of social, educational and recreational
facilities and activities.
|
|
Risk
If proposed
changes are not approved, the income generated from fees and charges may not
cover actual costs incurred and result in a financial shortfall. It is also
likely to lead to far greater increases in the future. Increasing fees and
charges by too high a level however could result in dissatisfaction by those
impacted by the increase.
|
|
Financial impact
The proposed increases in charges will better
enable costs for the services to be met in the medium to long-term at an
appropriate proportion between applicants/consent holders and
ratepayers. The changes outlined will better meet the Revenue and
Financing Policy requirements.
|
|
Degree of significance and level of
engagement
Staff assess the proposals outlined in this report
as being of medium significance as they include increasing fees and charges
above 7.2%, any new fees or removal of fees and those where the Resource
Management Act and Food Act require formal consultation through a special
consultative procedure.
Consultation occurred for these matters in
accordance with the required statutory purpose in parallel with the
consultation for the Annual Plan 2023/24.
|
|
Climate Impact
The proposal in this report will have no impact on
the ability of Council to proactively respond to the impacts of climate
change now or in the future.
|
|
Inclusion of Māori in the
decision making process
No engagement with Māori has been undertaken
in preparing this report.
|
|
Delegations
This is a matter for Council.
|
