Written Q&A from Annual Plan Consultation – Martinborough, 14 May 2020
Questions and answers from ratepayers:
Please note: in the interests of expediency in order to assist people with their submissions we are only responding to the questions about the proposed AP changes at this point.
Q1: A critical issue for residents, businesses and visitors is to preserve those aspects of the environment and way of life that most of us value highly. How is this going to be explicitly factored into the Council’s plans at the outcome level? For example, an over-focus on growth, driven by economic security and sustainability outcomes could result in irreparable damage to the current way of life and the character of our towns. We are looking for evidence of balance. – Henry Carr & Lynne Abbott
A1: [Beijen] This relates to the spatial plan and district plan, so not strictly an Annual Plan issue, however the consultation regarding how we treat our towns will be rigorous and we’ll make sure we factor in all opinions in the long term view of how our communities exist with each other.
Q2: Where are the financial accounts and figures for income and expenditure? Where is the detail of the 'Operating Shortfall" that is requiring the $1.5M loan. Where does this loan leave the overall balance sheet? – Karen Krogh
A2: [Wilson] The $1.5m loan is using some of our capital to be able to offset some of the rates impact due to the financial effects of COVID-19 – likened to taking an extended mortgage on your house to fund an operating shortfall – the detail is shown clearly in the financial reports.
The Statement of Financial Performance in the support documentation details the shortfall in income over expenditure resulting in a planned deficit of $391K. In addition $1.3M of contributions revenue is expected to be transferred to Reserves. The $1.5m loan is to fund the cash shortfall this leaves.
The effect of the loan on the balance sheet is to increase our cash assets and increase our non-current liabilities. There is no effect on Equity.
Q3: It was previously decided to progress with the Martinborough Growth Area (MGA) project before the spatial plan was completed. The commentary in the consultation document would indicate that further progress will be delayed until after the Spatial Plan has been completed? What has been spent so far in developing this project and what expected costs associated with MGA has been allocated in the 2020/2021 year? – Daphne Geisler
A3: [Beijen] Initial scoping of the MGA had started, notably around stormwater and the viability of the growth area. SWDC spent $9,500 on external consultants in the 2019/20 financial year. There would also be some internal staff time on the project. No further funds have been allocated specifically to the project going forward. The project is now on hold and a further decision regarding the MGA will be included in the Spatial Plan, following full consultation with the public.
Q4: Three-part question: a. At a recent Martinborough Community Board meeting the CEO said that the Board could not consult on just two or three options – they had to show multiple options which should be developed in detail before going to the public with consultation, then… why then does this AP consultation ask for a yes / no for support of a single proposal of significant cost, to fund the Greytown Sports and recreation Hub? b. What other options have the Council developed to solve the objective they have identified as "secure more recreation space in Greytown", and why were these not presented as choices in this consultation. c. As the people of Greytown already own the land through a Trust, for the benefit of Greytown people and the Council are attempting to own the land on behalf of the community, what attempt has been made to the secure the land for the benefit of the community outside of a pure commercial transaction which would result in the community paying millions for land they already beneficially 'own' in an economic environment where we are all challenged. – Daphne Geisler
A4: [Wilson] Re the importance of Council considering all options in front of it before making decisions. The pre-cursor to this is consultation. Consultation is not a yes/no answer – we’re simply looking for as much information from the community about the options we’re consulting on. In this case, the long-term issue is ensuring we have enough recreation space in Greytown but this is the first step, it’s not necessarily the final answer.
Q5: Are there funds available in the SWDC accounts already allocated to the Greytown Green space fund? Funds which have not been spent from development previous to today. – Duncan Ryman
A5: [Beijen] Yes, there are. This is $500k in total in next year and the following year’s allocation in the LTP. This has been taken into account in the plan we have in place. We have reserves for greenspace, paid for by development fees but they don’t go the full way to purchasing land in Greytown. The cost of land in Greytown is escalating and we’ve found a way to fund this which uses a mixture of loan funding and reserves, without using all the reserves and so protect them for future use.
Q6: Why are you looking to buy the Greytown rugby and bowling clubs land when effectively the “people of Greytown” own the land as trustees of Greytown Trust Lands? – Nathan Fenwick
A6: [Beijen] The current owner of the land is requesting market rents from the clubs and no club can afford that. We provide clubs with non-market rent throughout the rest of the South Wairarapa. In order to secure the future of the clubs, and the recreational space they are sitting on, for the people of South Wairarapa we propose to purchase the land.
Q7: Water supply – if $5million is long-term funding what amount is allocated in this AP? Using that number is a bit misleading without an AP number for each initiative. – Daphne Geisler
A7: [Wilson] The $5million is the cost for those initiatives for the AP year and was not budgeted in the LTP. Council has already agreed to $500k capital.
Q8: Given you have identified the cost of the swimming pool issue at $28,000, why has no number been put on all the Resource Area, these appear to require significant funds, the District Plan, Spatial Plan, MGA and Dark Sky need some numbers? – Daphne Geisler
A8: [Wilson] We need to be able to size the work to be done. We know what the swimming pool cost is because we’ve been trialling it. We’ve made estimates for the other areas which are ongoing and will be subject to further consultation as part of the LTP consultation.
Q9: I was told that water storage for new buildings could not be done before the District plan review was complete – Alex indicated the water storage initiatives could start as soon as possible. Which is correct? – Daphne Geisler
A9: [Beijen] We’re looking at changing the District Plan to include requirements for water storage for new buildings as part of the building consent. Until then, we have some initiatives where we’re investigating to subsidise or partially fund water storage options for existing or new buildings.
Q10: Can you explain what wrapping the Martinborough Growth Area (MGA) into the spatial plan means? Is there a budget for MGA for 2020/21? – Daphne Geisler
A10: [Wilson] We’re trying to bring the MGA project into sequence with the Spatial Plan. So, we need to look at the Spatial Plan first, to see where people aspire to live, work and play. Rather than run both projects in parallel.
Q11: Can you please explain what, "spread next year’s cost of running Council operations over the next 5 years" means? What is the cost of doing this is? Given the uncertain financial future why are you confident that next year ratepayers will be able to afford an additional 1.5% on top of whatever is planned for that year. What savings have been agreed and built into the 2020/21 plan? It seems like me not paying my monthly household bills and putting them all on credit expecting next year will be better without doing any serious budgeting. A bit scary! Also makes the financials of this AP unnecessarily complex and convoluted. – Daphne Geisler
A11: [Wilson] We’ve taken the costs the Council needs to operate and are funding them from our capital by adjusting our balance sheet by $1.5m. This in turn leads to an average 2.54% increase for ratepayers this year and 1.5% for the remaining four years.
Post-meeting clarification: There is a significant amount of investment required in water and roading infrastructure and this needs to continue as planned. This additional operational and capital spend required a forecast rates increase of a level Council was uncomfortable with, given the current environment. With interest rates at very low levels Council are proposing to take advantage of this and use short-term borrowing to offset the impact to ratepayers
Q12: In May 2019 Council said of the new strategic joint roading contract: "The joint approach came after a review in 2018 from an outside consultant showed a collaborative approach would deliver a more efficient and cost-effective service." Someone at Council was confident that the contract they had negotiated would result in cost savings, and/or improved service! a. Why then, less than a year later, did 20% less maintenance get completed in the year, and a further $600k over the $2.1 million already funded is required for the future year? b. Was this an error in the negotiation process or lack of Council oversight of completion of the work plan? c. What attempts have been made to get better value for money from the contract as expected in May 2019 and is funding an additional $600,000 just an easy way of "managing" the relationship which has not delivered the expected efficiency or cost savings? – Daphne Geisler
A12: Answer added post-meeting: The contract for the maintenance, operation and renewal was by public tender as outlined in the NZTA endorsed South Wairarapa District Council Procurement Strategy and not negotiated. The Tender was evaluated in terms of NZTA’s approved evaluation procedure. The extra $600K on top of the 2020/2021 budget of $3.2 million will allow us to partially fund the shortfall of approximately 30% increase in contract tender price.
The cost of roadworks have increased beyond that which was anticipated in the contract. The increase means can complete less physical work on our roads for the budget we have allocated. Council believes it is important to keep the standard of maintenance at a level that ensures the safety of road users. Fifty-two percent of this cost will be subsidised by NZTA and this has been factored into the AP.
The joint shared service agreement with Carteton District Council is still in the infancy and the loser collaboration has been acknowledged and championed by NZTA.
Questions arising from submissions/on key topics:
Q13: Why isn’t SWDC freezing rates as other councils are doing?
A13: [Beijen] Currently, one Council in New Zealand has confirmed it is freezing rates and a further ten councils have indicated they are considering freezing rates. However, 66 Councils are taking a balanced view regarding COVID-19.A rates freeze would cripple economic recovery, especially in rural areas. Freezing rates would be delaying an issue and make it much harder to recover over the next five years.
Post-meeting clarification: If we freeze rates, there would be essential projects that we would not be able to undertake, such as sorting our water problems and fixing our roads. We believe we need to continue to deliver these essential projects. By taking advantage of low interest loans and spreading the costs we can do these, and keep rate increases low. The proposed, average rates increase has been reduced from 11.3% to an average of 2.54% next year and 1.5% increase for the four years that follow. For those in genuine financial hardship, we offer rates relief options, so people should get in touch.
Q14: Why are you putting up rates for Housing for Seniors?
A14: [Beijen] Rents are being realigned. We’re aware we need to spend quite a lot of money bringing the accommodation up to standard. Also, we have looked at the rates for senior housing around the Wairarapa and we feel the proposed rates are very reasonable and will enable the housing to be run as cost neutral.
Post-meeting clarification: The rent increase will not mean housing for seniors breaks even. It will still be a deficit to council and this will be passed onto ratepayers, however the long term aim is to move toward being cost neutral and to do this we need to gradually increase rents each year. There are many senior owner-occupiers in our district, who will have rates increases.
Q15: Waste minimisation – What are you going to put into place for rural ratepayers to make waste collection fairer?
A15: [Wilson] As detailed in the consultation document, we’re doing as much as we can to minimise waste. It’s always difficult to get the balance between urban and rural right, it often involves trade-offs but is an area we area we’re exploring.
Q16: How soon can we expect to see the water conservation measures introduced?
A16: [Beijen] These are included as ideas in the Annual Plan, so if the public is supportive they will be introduced in the LTP consultation in the next 12 months. They are slightly dependent on our applications to government for funding towards ‘shovel ready’ projects and the outcome of those.
Q17: What is Council doing to forecast growth, development and population increases to determine where investment in infrastructure and other services is required?
A17: [Wison] This is crucial information – we’re using Census data and working with Infometrics, getting neutral and independent advice to ensure we are factoring in appropriate growth and development. The big question is how is that going to be impacted by COVID-19 – watch this space!
Q18: Why do rural ratepayers have to pay for footpaths and lighting that we don’t use?
A18: [Wilson] We’re a district, so we try to balance the way our services our funded – a balance between user pays and general funding. Some costs are direct and others are indirect. Part of the reason our towns exist is as service centres for our rural ratepayers. They provide schools, libraries, restaurants etc and naturally these come at a cost.
Q19: If we say no to extended swimming pool opening hours this year as we are concerned about rates rises, will this be shelved forever or can we look at this again in the future?
A19: [Beijen] Yes, this can certainly be looked at any stage.
Q20: I live in Carterton. Can I make a submission on the Annual Plan?
A20: [Beijen] Yes, you definitely can.
Q21: People without the internet have not been able to take part in this event. Do you think that’s fair? What are you doing to ensure that the digitally disabled are able to participate in the engagement?
A21: [Beijen] COVID-19 has meant the ideal consultation process can’t be followed but we’ve made sure the consultation document is widely available through the Midweek newspaper and at our Council offices and libraries, now they have re-opened.
Q22: If water is supposed to be the most important thing for the Council next year, why are you intending to spend money on projects like the Sports Hub and council accommodation?
A22: [Beijen] All the areas we’ve proposed to spend money on are important and can be done concurrently. If we ignore some of the urgent parts of the proposed Annual Plan, it will only cost us in the future. There are no vanity projects here, these are reactions to urgent issues that must be addressed.
Q23: There is a lot of support for the Dark Sky initiative and the money it will bring in for tourism. How will you stop the South Wairarapa turning into another Tekapo that is overrun with tourists and hasn’t got enough infrastructure for them? Does it mean more Air B&Bs?
A23: [Wilson] We’re very conscious of this. The Dark Sky initiative has wonderful benefits to our tourism sector. It smooths out the peaks we have over summer with the quieter winter months but we need to do it in a balanced way. We need to ensure the required services are available and planning the locations where people can interact with the Dark Sky.
Q24: There is no mention of climate change in the consultation document. Is the council doing anything in this space?
A24: [Wilson] Yes. This is certainly something that will be included in the Long Term Plan but it currently exists in everything we do. Council has adopted a Climate Change strategy and, as mentioned in the waste minimisation section, actions have already been taken by Council to reduce paper and waste. Also the design of the Featherston wastewater system which recognises the impact of aerobic pond systems.
Q25: How is the Council working with Māori?
A25: [Wilson] Council has a structured response to working with Māori and mana whenua in our area. We have a Māori Standing Committee (MSC) which includes representatives of hapu, marae, and major iwi. The MSC gives guidance to Council on our policies, plans and how we work.
Q26: Before we promote more cycling in the district we need to provide safe pathways for cycling. Our roads are too narrow, and uneven and bridges are very narrow. What plans are there for providing more cycle ways in the district?
A26: [Wilson] Yes, we need to have a plan. We need to ensure we’re investing in the right places, in the right way and at the right time, so this is very much on our agenda.
Post-meeting clarification: Wairarapa Trails Action Group is currently capturing all cycle trails and possibilities to build into the Final design and then apply for funding from the government.
Q27: One of the key components of the proposed sports hub is the Kuranui gym but there is a perfectly good stadium in Featherston that is underutilised. Why should our rates go towards providing yet another facility?
A27: [Beijen] The Kuranui gym is intended to service the whole of the South Wairarapa district. We also need to plan for the growth and sporting needs of our entire area. A number of people from other towns do use the facilities in Greytown. With the extension of a number of housing projects in Greytown we’re looking at shortfall of sporting land in Greytown.
Q28: How do you ensure that the extra money spent on the council will improve services rather than more bureaucracy?
A28: [Wilson] A certain level of bureaucracy is the reality of Council business. We must follow the legislation and rules but we do want to improve our service in making these visible and understandable to people. For example, Building Act controls, at present the only way to find out what stage your buildings consent application is at, is by phoning Council and asking us. We want to improve this process by giving applicants access to a computer system where they can view the progress and details of their applications at every step. Our priority areas are those that will improve our customer service.
Q29: When are you going to move Martinborough’s bores from being in the middle of a dairy farm?
A29: [Wilson] The Manganese Reduction Plant (MRP) we’re putting in to make sure the water is clear is a temporary solution for up to 5 years. We’ll be starting this year to identify how we locate new water supply options and where we locate our treatment solutions.
Q30: Why are you putting up fees for building and RMA consents? Shouldn’t you be encouraging more development to get the economy going after Covid-19?
A30: [Wilson] These increases are very modest. A number of the high-end development costs are frozen – there is no increase – and one or two have gone down. There has to be a balance between what the ratepayer should fund and what the developer pays. If there is no increase in fees for the private developer, then cost increases will be passed on to the ratepayer. The fee structure is also aligned with other Wairarapa Councils.
Q31: How do you make sure that the Kurunui College gym will be available for community groups and other sports? The school uses it a lot after hours and it is unlikely that people will want to play sports at 7pm at night.
A31: [Beijen] There are a number of examples throughout the Wellington region of successful private/public partnerships with regards to gyms. We can use these to model our agreement to ensure access for all user groups and work in a collaborative manner with Kuranui College. Refer also to the supporting information on the Annual Plan Consultation pages which identifies potential usage rates for the gym.
Q32: Are the plans to build a new mountain bike park in this year’s annual plan? How is that progressing?
A32: [Beijen] Options are still being investigated. You’re welcome to add a submission on this issue.
