Finance and Performance Committee

Agenda

 

 

Notice of Meeting:

An ordinary meeting of the Finance & Performance Committee will be held on:

 

Date:                                    Thursday 26 May 2022

Time:                                   9.30am

Venue:                                 Council Chambers, Civic Offices,
53 Hereford Street, Christchurch

 

 

Membership

Chairperson

Deputy Chairperson

Members

Deputy Mayor Andrew Turner

Councillor Sam MacDonald

Mayor Lianne Dalziel

Councillor Jimmy Chen

Councillor Catherine Chu

Councillor Melanie Coker

Councillor Pauline Cotter

Councillor Mike Davidson

Councillor Celeste Donovan

Councillor Anne Galloway

Councillor James Gough

Councillor Yani Johanson

Councillor Aaron Keown

Councillor Phil Mauger

Councillor Jake McLellan

Councillor Tim Scandrett

Councillor Sara Templeton

 

 

20 May 2022

 

 

Principal Advisor

Leah Scales

General Manager - Resources / CFO

Tel: 941 8999

Principal Advisor

Dawn Baxendale

Chief Executive

Tel: 941 6996

 

 

David Corlett

Committee and Hearings Advisor

941 5421

david.corlett@ccc.govt.nz

www.ccc.govt.nz

Note:  The reports contained within this agenda are for consideration and should not be construed as Council policy unless and until adopted.  If you require further information relating to any reports, please contact the person named on the report.
To view copies of Agendas and Minutes, visit:
https://www.ccc.govt.nz/the-council/meetings-agendas-and-minutes/

 


Finance and Performance Committee

26 May 2022

 

Finance and Performance Committee of the whole - Terms of Reference Ngā Ārahina Mahinga

 

Chair

Deputy Mayor Turner

Deputy Chair

Councillor MacDonald

Membership

The Mayor and all Councillors

Quorum

Half of the members if the number of members (including vacancies) is even, or a majority of members if the number of members (including vacancies) is odd

Meeting Cycle

Monthly

Reports To

Council

 

Delegations

The Council delegates to the Finance and Performance Committee authority to oversee and make decisions on:

 

Capital Programme and operational expenditure

·         Monitoring the delivery of the Council’s Capital Programme and associated operational expenditure, including inquiring into any material discrepancies from planned expenditure.

·         As may be necessary from time to time, approving amendments to the Capital Programme outside the Long-Term Plan or Annual Plan processes.

·         Approving Capital Programme business and investment cases, and any associated operational expenditure, as agreed in the Council’s Long-Term Plan.

·         Approving any capital or other carry forward requests and the use of operating surpluses as the case may be.

·         Approving the procurement plans (where applicable), preferred supplier, and contracts for all capital expenditure where the value of the contract exceeds $15 Million (noting that the Committee may sub delegate authority for approval of the preferred supplier and /or contract to the Chief Executive provided the procurement plan strategy is followed).

·         Approving the procurement plans (where applicable), preferred supplier, and contracts, for all operational expenditure where the value of the contract exceeds $10 Million (noting that the Committee may sub delegate authority for approval of the preferred supplier and/or contract to the Chief Executive provided the procurement plan strategy is followed).

 

Non-financial performance

·         Reviewing the delivery of services under s17A.

·         Amending levels of service targets, unless the decision is precluded under section 97 of the Local Government Act 2002.

·         Exercising all of the Council's powers under section 17A of the Local Government Act 2002, relating to service delivery reviews and decisions not to undertake a review.

 

Council Controlled Organisations

·         Monitoring the financial and non-financial performance of the Council and Council Controlled Organisations.

·         Making governance decisions related to Council Controlled Organisations under sections 65 to 72 of the Local Government Act 2002.

·         Exercising the Council’s powers directly as the shareholder, or through CCHL, or in respect of an entity (within the meaning of section 6(1) of the Local Government Act 2002) in relation to –

o   (without limitation) the modification of constitutions and/or trust deeds, and other governance arrangements, granting shareholder approval of major transactions, appointing directors or trustees, and approving policies related to Council Controlled Organisations; and

o   in relation to the approval of Statements of Intent and their modification (if any).

 

Development Contributions

·         Exercising all of the Council's powers in relation to development contributions, other than those delegated to the Chief Executive and Council officers as set out in the Council's Delegations Register.

 

Property

·         Purchasing or disposing of property where required for the delivery of the Capital Programme, in accordance with the Council’s Long-Term Plan, and where those acquisitions or disposals have not been delegated to another decision-making body of the Council or staff.

 

Loans and debt write-offs

·         Approving debt write-offs where those debt write-offs are not delegated to staff.

·         Approving amendments to loans, in accordance with the Council’s Long-Term Plan.

 

Insurance

·         All insurance matters, including considering legal advice from the Council’s legal and other advisers, approving further actions relating to the issues, and authorising the taking of formal actions (Sub-delegated to the Insurance Subcommittee as per the Subcommittees Terms of Reference)

 

Annual Plan and Long Term Plan

·         Provides oversight and monitors development of the Long Term Plan (LTP) and Annual Plan.

·         Approves the appointment of the Chairperson and Deputy Chairperson of the External Advisory Group for the LTP 2021-31.

 

Submissions

·         The Council delegates to the Committee authority:

·         To consider and approve draft submissions on behalf of the Council on topics within its terms of reference. Where the timing of a consultation does not allow for consideration of a draft submission by the Council or relevant Committee, that the draft submission can be considered and approved on behalf of the Council.

 

Limitations

·         The general delegations to this Committee exclude any specific decision-making powers that are delegated to a Community Board, another Committee of Council or Joint Committee. Delegations to staff are set out in the delegations register.

·         The Council retains the authority to adopt policies, strategies and bylaws.

 

The following matters are prohibited from being subdelegated in accordance with LGA 2002 Schedule 7 Clause 32(1) :

·         the power to make a rate; or

·         the power to make a bylaw; or

·         the power to borrow money, or purchase or dispose of assets, other than in accordance with the long-term plan; or

·         the power to adopt a long-term plan, annual plan, or annual report; or

·         the power to appoint a chief executive; or

·         the power to adopt policies required to be adopted and consulted on under this Act in association with the long-term plan or developed for the purpose of the local governance statement; or

·         the power to adopt a remuneration and employment policy.

 

Chairperson may refer urgent matters to the Council

As may be necessary from time to time, the Committee Chairperson is authorised to refer urgent matters to the Council for decision, where this Committee would ordinarily have considered the matter. In order to exercise this authority:

·         The Committee Advisor must inform the Chairperson in writing the reasons why the referral is necessary

·         The Chairperson must then respond to the Committee Advisor in writing with their decision.

·         If the Chairperson agrees to refer the report to the Council, the Council may then assume decision making authority for that specific report.

 

Urgent matters referred from the Council

As may be necessary from time to time, the Mayor is authorised to refer urgent matters to this Committee for decision, where the Council would ordinarily have considered the matter, except for those matters listed in the limitations above.

 

In order to exercise this authority:

·         The Council Secretary must inform the Mayor and Chief Executive in writing the reasons why the referral is necessary

·         The Mayor and Chief Executive must then respond to the Council Secretary in writing with their decision.

 

If the Mayor and Chief Executive agrees to refer the report to the Committee, the Committee may then assume decision-making authority for that specific report.

 


Finance and Performance Committee

26 May 2022

 

Part A           Matters Requiring a Council Decision

Part B           Reports for Information

Part C           Decisions Under Delegation

 

 

TABLE OF CONTENTS

 

Karakia Tīmatanga................................................................................................... 7 

C          1.        Apologies Ngā Whakapāha.......................................................................... 7

B         2.        Declarations of Interest Ngā Whakapuaki Aronga........................................... 7

C          3.        Confirmation of Previous Minutes Te Whakaāe o te hui o mua.......................... 7

B         4.        Public Forum Te Huinga Whānui.................................................................. 7

B         5.        Deputations by Appointment Ngā Huinga Whakaritenga................................. 7

B         6.        Presentation of Petitions Ngā Pākikitanga.................................................... 7

Staff Reports

C          7.        Christchurch Wastewater Treatment Plant Recovery Update......................... 21

B         8.        Key Performance Results April 2022........................................................... 27

B         9.        Financial Performance Report - April 2022................................................... 47

B         10.      Capital Programme Performance Report - April 2022.................................... 57

B         11.      Te Kaha Project - Elected Member Update.................................................. 111

C          12.      South Library Te Kete Wānanga o Wai Mōkihi - Earthquake Repair Options..... 113

C          13.      Local Government Funding Agency - Quarter 3, 2021/22 Performance Report. 271

C          14.      Christchurch Foundation - Budget 2022/23................................................ 291  

C          15.      Resolution to Exclude the Public.............................................................. 303

Karakia Whakamutunga

 


Finance and Performance Committee

26 May 2022

 

 

Karakia Tīmatanga

1.   Apologies Ngā Whakapāha  

At the close of the agenda no apologies had been received.

2.   Declarations of Interest Ngā Whakapuaki Aronga

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

3.   Confirmation of Previous Minutes Te Whakaāe o te hui o mua

That the minutes of the Finance and Performance Committee meeting held on Thursday, 28 April 2022  be confirmed (refer page 8).

4.   Public Forum Te Huinga Whānui

A period of up to 30 minutes will be available for people to speak for up to five minutes on any issue that is not the subject of a separate hearings process.

 

There were no public forum requests received at the time the agenda was prepared

5.   Deputations by Appointment Ngā Huinga Whakaritenga

Deputations may be heard on a matter or matters covered by a report on this agenda and approved by the Chairperson.

 

There were no deputations by appointment at the time the agenda was prepared.

6.   Presentation of Petitions Ngā Pākikitanga

There were no petitions received at the time the agenda was prepared.


Finance and Performance Committee

26 May 2022

Unconfirmed

 

 

Finance and Performance Committee

Open Minutes

 

 

Date:                                    Thursday 28 April 2022

Time:                                   9.30am

Venue:                                 Council Chambers, Civic Offices, 53 Hereford Street, Christchurch

 

 

Present

Chairperson

Deputy Chairperson

Members

Deputy Mayor Andrew Turner

Mayor Lianne Dalziel

Councillor Jimmy Chen

Councillor Catherine Chu

Councillor Melanie Coker

Councillor Pauline Cotter

Councillor Mike Davidson

Councillor Celeste Donovan

Councillor Anne Galloway

Councillor James Gough     -     via audio/visual link

Councillor Yani Johanson

Councillor Phil Mauger

Councillor Jake McLellan

Councillor Tim Scandrett

Councillor Sara Templeton

 

 

 

 

 

 

Principal Advisor

Leah Scales

General Manager - Resources / CFO

Tel: 941 8999

Principal Advisor

Dawn Baxendale

Chief Executive

Tel: 941 6996

 

David Corlett

Committee and Hearings Advisor

941 5421

david.corlett@ccc.govt.nz

www.ccc.govt.nz

To view copies of Agendas and Minutes, visit:
www.ccc.govt.nz/the-council/meetings-agendas-and-minutes/

 


Part A           Matters Requiring a Council Decision

Part B           Reports for Information

Part C           Decisions Under Delegation

 

 

 

Karakia Tīmatanga: Given by Deputy Mayor Turner.    

 

The agenda was dealt with in the following order.

1.   Apologies Ngā Whakapāha

Part C

Committee Resolved FPCO/2022/00015

That the apologies received from Councillor Keown for absence and Councillor MacDonald for partial absence be accepted. That the apology from Mayor Dalziel for a late arrival and Councillor Gough for a possible early departure be accepted.

Deputy Mayor/Councillor Davidson                                                                                                                   Carried

 

2.   Declarations of Interest Ngā Whakapuaki Aronga

 

The Mayor, Deputy Mayor Turner and Councillors Gough and Templeton declared an interest item 13. Council-controlled organisations – Draft Statements of Intent for 2022/23 in relation to Christchurch City Holdings Limited.

 

Councillor Chen declared an interest item 13. Council-controlled organisations – Draft Statements of Intent for 2022/23 in relation to the Riccarton Bush Trust.

 

Councillors Gough, Mauger and MacDonald declared an interest item 13. Council-controlled organisations – Draft Statements of Intent for 2022/23 in relation to Civic Buildings Ltd.

 

Deputy Mayor Turner declared an interest in item 13. Council-controlled organisations – Draft Statements of Intent for 2022/23 in relation to Rod Donald Trust.

 

The Mayor, Deputy Mayor Turner, Councillors Gough and Templeton declared an interest in item 14. Christchurch City Holdings Ltd – Draft Statements of Intent 2022/23.

 

Councillor Scandrett decalred an interest in item 15. Venues Otautahi.

 

Deputy Mayor Turner and Councillor Davidson declared an interest in item 16. ChristchurchNZ Holdings Ltd – Draft Statement of Intent for 2022/23.

 

Councillor Mauger declared an interest in item 22. Organics Processing Plant.

 

 

A minutes silence was observed in recognition of Workers Memorial Day.

3.   Confirmation of Previous Minutes Te Whakaāe o te hui o mua

Part C

Committee Resolved FPCO/2022/00016

That the minutes of the Finance and Performance Committee meeting held on Thursday, 24 March 2022 be confirmed.

Deputy Mayor/Councillor Scandrett                                                                                                                  Carried

 

26. Resolution to Include Supplementary Reports

 

Committee Resolved FPCO/2022/00017

That the reports be received and considered at the Finance and Performance Committee meeting on Thursday, 28 April 2022.

Open Items

22.       Organics Processing Options

Deputy Mayor/Councillor Scandrett                                                                                                                  Carried

 

4.   Public Forum Te Huinga Whānui

Part B

There were no public forum presentations.

5.   Deputations by Appointment Ngā Huinga Whakaritenga

 

5.1      Dr Tracey McLellan, MP for Banks Peninsula

In relation to item 7 Christchurch Wastewater Treatment Plant Recovery Update and item 22. Organics Processing Options.

 

5.2      Michael Williams

In relation to item 7 Christchurch Wastewater Treatment Plant Recovery Update and item 22. Organics Processing Options.  A written copy of Mr Williams presentation was pre-circulated (copy attached).

Attachments

a       Michael Williams presentation  

 

5.3      Nicole Marshall

In relation to item 7 Christchurch Wastewater Treatment Plant Recovery Update and item 22. Organics Processing Options.

 

5.4      Bruce King

In relation to item 7 Christchurch Wastewater Treatment Plant Recovery Update and item 22. Organics Processing Options.

 

5.5      Geoffrey King

In relation to item 7 Christchurch Wastewater Treatment Plant Recovery Update and item 22. Organics Processing Options.

 

5.6      Don Gould

In relation to item 7 Christchurch Wastewater Treatment Plant Recovery Update. Mr Gould spoke to his presentation (attached.)

Attachments

a       Don Gould presentation  

 

5.7      Vicki Walker

In relation to item 7 Christchurch Wastewater Treatment Plant Recovery Update and item 22. Organics Processing Options.

 

 

Councillor left the meeting at10.32am and returned at 10.36am during Item 5.

 

The meeting adjourned at 10.52am and resumed at 11.10am.

6.   Presentation of Petitions Ngā Pākikitanga

Part B

There was no presentation of petitions.

 

7.   Christchurch Wastewater Treatment Plant Recovery Update

 

Committee Comment

1.         Staff spoke to their presentation (attached).

2.         The Committee asked staff to make the results of the air quality monitoring available to elected members once it has been received.

3.         The Committee noted the impact of the odour on residents and requested advice from staff and what support could be provided. The Committee also requested fortnightly progress  updates on progress with Waste Water Treatment Plant recovery.

 

Officer Recommendations Ngā Tūtohu

That the Finance and Performance Committee:

1.         Receives the information in this update

2.         Notes that regular communications will be implemented to ensure residents in the local area and across the city are aware of all efforts being undertaken to expedite the removal process and reduce the effects of the odours.

3.         Notes that an update on the details of the insurance claim will be reported to the Insurance sub-committee

 

Committee Resolved FPCO/2022/00018

Part C

That the Finance and Performance Committee:

1.         Receives the information in this update

2.         Notes that regular communications will be implemented to ensure residents in the local area and across the city are aware of all efforts being undertaken to expedite the removal process and reduce the effects of the odours.

3.         Notes that an update on the details of the insurance claim will be reported to the Insurance sub-committee

4.         Request staff:

a.         Provide advice on ways that support could be provided for affected residents

b.         Report fortnightly to the Council or the Finance and Performance Committee on progress with Waste Water Treatment Plant recovery

 

Mayor/Councillor Galloway                                                                                                                                  Carried

 

Attachments

a       Staff Presentation Waste Water Treatment Plant Update  

 

 

 

 

The Mayor joined the meeting at 11.11am, and Councillors  Donovan and Johanson joined the meeting at 11.13am during item 7.

 

Having previously noting a conflict of interest Councillor Mauger left the meeting for all of item 22 and returned after the lunch adjournment.

 

22. Organics Processing Options

 

Committee Comment

1.         The Committee requested staff bring back, in one month, the full net cost to Council and implications of immediately closing the plant.

 

Officer Recommendations Ngā Tūtohu

That the Finance and Performance Committee resolves to:

1.         Agree in principle the relocation of the Organics Processing Facility to an alternative site

2.         Request staff to:

(a)   approach the market for options for location, partnerships, joint ventures, commercial opportunities, and

(b)   report to Council on short listed relocation options with a comparison to redevelopment of the current site by end February 2023.

3.         Support the continued operation at the Metro Place site with the current process controls to manage and mitigate odour until an alternative facility, or redevelopment of the current site, is operational.

4.         Agree that, should it be necessary to meet the interim capex needs of the existing facility, staff are able to utilise part of the current capital budget for the new facility.  Any capital expenditure will be confined to meeting compliance requirements and any decision to use the capex will be made by GM Infrastructure Planning & Regulatory Services in consultation with the Chair and Deputy Chair of the Finance & Performance Committee.

5.         Agree that the redacted information can be released when the Chief Executive is satisfied that there are no longer grounds under LGOMIA for withholding the information.

 

Committee Resolved FPCO/2022/00019

Part C

That the Finance and Performance Committee resolves to:

1.         Agree in principle the relocation of the Organics Processing Facility to an alternative site

2.         Request staff to:

(a)   approach the market for options for location, partnerships, joint ventures, commercial opportunities, and

(b)   report to Council on short listed relocation options with a comparison to redevelopment of the current site by end February 2023.

3.         Support the continued operation at the Metro Place site with the current process controls to manage and mitigate odour until an alternative facility, or redevelopment of the current site, is operational.

4.         Agree that, should it be necessary to meet the interim capex needs of the existing facility, staff are able to utilise part of the current capital budget for the new facility.  Any capital expenditure will be confined to meeting compliance requirements and any decision to use the capex will be made by GM Infrastructure Planning & Regulatory Services in consultation with the Chair and Deputy Chair of the Finance & Performance Committee, in the event that the Committee does not exist, in consultation with the Mayor and Deputy Mayor.

5.         Agree that the redacted information can be released when the Chief Executive is satisfied that there are no longer grounds under LGOMIA for withholding the information.

6.         Request staff bring back in one month the full net cost to Council and implications of immediately closing the plant.

7.         Note that Council is working with central government and Local MPs on shared outcomes regarding recycling.

Councillor Cotter/Councillor Johanson                                                                                                           Carried

 

 

 

The meeting adjourned at 1.12pm at the conclusion of Item 22 and resumed at 2.18pm.

Councillor Gough did not return to the meeting after the break.

Councillor Chu returned to the meeting via audio/visual link.

 Councillor McLellan returned to the meeting at 2.22pm and Mayor Dalziel return at 2.25pm during item 15.

 

15. Venues Ōtautahi draft Statement of Intent 2022/23

 

Committee Resolved FPCO/2022/00020 Officer Recommendation accepted without change

Part C

That the Finance and Performance Committee:

1.         Receives Venues Ōtautahi’s draft Statement of Intent for 2022/23.

Deputy Mayor/Councillor Chen                                                                                                                           Carried

 

 

An adjournment was held taken from 240pm to 3.00pm during item 15.

 

Election of a Chair

 

Committee Resolved FPCO/2022/00021

It was resolved on the motion of Councillor Davidson, seconded by Councillor Cotter  that Councillor Scandrett be appointed Chairperson for items 14, 16 and item 13 in relation to the Rod Donald Trust.

Councillor Davidson/Councillor Cotter                                                                                                            Carried

 

Councillor Coker left the meeting at 3.09pm and returned at 3.12pm during item 14.

 

 

 

14. Christchurch City Holdings Ltd - Draft Statements of Intent 2022/23

 

Committee Resolved FPCO/2022/00022 Officer Recommendation accepted without change

Part C

That the Finance and Performance Committee:

1.         Notes the draft Statements of Intent for 2022/23 for Christchurch City Holdings Ltd and its subsidiaries;

2.         Notes that Christchurch City Holdings Ltd’s business planning process for 2022/23 and subsequent years will end in May 2022 and its forecast dividend to the Council for the Statement of Intent’s three year period will be advised in time for inclusion in the Annual Plan for 2022/23; and

3.         Agrees to provide the following feedback on Christchurch City Holdings Ltd’s draft Statement of Intent for 2022/23:

a)    Acknowledges the work that Christchurch City Holdings have done to reflect requests by Council in their Letter of Expectations for 2022/23.

b)    That requests Christchurch City Holdings Ltd to continue to work with Council staff on the review of its dividend policy for inclusion in its final Statement of Intent for 2022/23, as requested in the Letter of Expectations for 2022/23; and

c)    Acknowledges the recommendations of the CCHL Strategic review coming to the new Council in November.

Councillor Scandrett/Councillor Cotter                                                                                                           Carried

 

 

 

16. ChristchurchNZ Holdings Ltd - Draft Statement of Intent for 2022/23

 

Committee Resolved FPCO/2022/00023 Officer Recommendation accepted without change

Part C

That the Finance and Performance Committee:

1.         Receives the draft Statement of Intent for ChristchurchNZ Holdings Limited for 2022/23.

2.         Approves the following:

a.         Capitalisation of CNZ via amalgamation of DCL as at 1 July 2022.

b.         The CNZ Urban Development Prioritisation Framework

c.         The CNZ/CCC Value Sharing Agreement

Councillor Scandrett/Councillor Templeton                                                                                                 Carried

 

Attachments

a       Item 16 Christchurch NZ  

 

 

Deputy Mayor Turner resumed Chair for Item 13 in relation to resolutions 2 and 3.

 

13. Council-controlled organisations - Draft Statements of Intent for 2022/23

 

Committee Resolved FPCO/2022/00024 Officer Recommendation accepted without change

Part C

That the Finance and Performance Committee:

1.         Receives Rod Donald Banks Peninsula Trust’s draft Statement of Intent for 2022/23;

 

Councillor Davidson/Councillor Cotter                                                                                                            Carried

 

Committee Resolved FPCO/2022/00025 Officer Recommendation accepted without change

That the Finance and Performance Committee:

2.         Receives Civic Building Ltd’s draft Statement of Intent for 2022/23;

 

Deputy Mayor/Councillor Scandrett                                                                                                                  Carried

 

Committee Resolved FPCO/2022/00026 Officer Recommendation accepted without change

That the Finance and Performance Committee:

3.         Receives Central Plains Water Trust’s draft Statement of Intent for 2022/23.

 

Councillor Scandrett/Councillor McLellan                                                                                                      Carried

 

 

20. Te Kaha Project Delivery Ltd - Draft Statement of Intent for 2022/23 and Quarter 2 Performance Report for period ending 31 December 2021

 

Committee Resolved FPCO/2022/00027 Officer Recommendation accepted without change

Part C

That the Finance and Performance Committee:

1.         Receives Te Kaha Project Delivery Ltd’s draft Statement of Intent for 2022/23; and

2.         Receives Te Kaha Project Delivery Ltd’s Quarter 2 Performance Report for the period ending 31 December 2021.

Deputy Mayor/Councillor Chen                                                                                                                           Carried

 

 

21. Te Kaha Project - Elected Member Update

 

Committee Resolved FPCO/2022/00028 Officer Recommendation accepted without change

Part C

That the Finance and Performance Committee:

1.         Receive the information in the Te Kaha Project Elected Members Update Report.

Deputy Mayor/Councillor Mauger                                                                                                                      Carried

 

 

17. Local Government Funding Agency - Draft Statement of Intent 2022/23 and Shareholder Presentation

 

Committee Comment

1.         Mark Butcher the Chief Executive spoke to his presentation (attached).

 

Committee Resolved FPCO/2022/00029 Officer Recommendation accepted without change

Part C

That the Finance and Performance Committee:

1.         Notes the Local Government Funding Agency’s draft Statement of Intent for 2022/23; and

2.         Notes the investor presentation to be conducted by Mr Mark Butcher, Chief Executive of the Local Government Funding Agency at the Finance and Performance Committee’s meeting.

Deputy Mayor/Councillor Cotter                                                                                                                         Carried

 

Attachments

a       Local Government Funding Agency  

 

 

8.   Key Performance Results March 2022

 

Committee Comment

1.         The Committee requested staff to clarify why two percentage figures were given in LTP21.9.1.

2.         The Committee requested a briefing from staff on  excess water charges.

3.         The Committee requested the Research results from NIWA on LED lighting when available.

 

 

Committee Resolved FPCO/2022/00030 Officer Recommendation accepted without change

Part C

That the Finance and Performance Committee:

1.         Receives the information provided in the Key Performance Results for March 2022.

Deputy Mayor/Councillor Cotter                                                                                                                         Carried

 

 

9.   Financial Performance Report - March 2022

 

Committee Comment

1.         The Committee requested an update on the carry forward of the EV grants that were referenced in paragraph 15 on page 64 of the staff report.

 

Committee Resolved FPCO/2022/00031 Officer Recommendation accepted without change

Part C

That the Finance and Performance Committee:

1.         Receives the information in the Financial Performance Report for March 2022.

2.         Notes the likely breach of the Funding risk policy limit from April to September 2022 and the staff advice supporting it.

Deputy Mayor/Councillor Chen                                                                                                                           Carried

 

 

10. Capital Programme Performance Report - March 2022

 

Committee Comment

1.         The Committee requested an update on when will start on the section of the South Express between Templeton and Eastland to Hornby.

2.         The Committee requested an update on budget issues relating to the Halswell Junction Road Extension project.

 

Committee Resolved FPCO/2022/00032 Officer Recommendation accepted without change

Part C

That the Finance and Performance Committee:

1.         Receive the information in the Capital Programme Performance Report – March 2022

Deputy Mayor/Councillor Templeton                                                                                                               Carried

 

 

11. Vertical Capital Delivery : Bi-Monthly Update

 

Committee Comment

1.         The Committee requested that the Diamond Harbour Wharf plan be circulated.

 

Committee Resolved FPCO/2022/00033 Officer Recommendation accepted without change

Part C

That the Finance and Performance Committee:

1.         Receive the information in the Vertical Capital Delivery :  Bi-Monthly Update Report.

Councillor Cotter/Councillor Davidson                                                                                                            Carried

 

 

12. Delegations and Visibility of Budget Changes in the Capital Programme

 

Committee Resolved FPCO/2022/00034 Officer Recommendation accepted without change

Part C

That the Finance and Performance Committee:

1.         Approve major project budget changes, over $5m, in the programmes of Three Waters, Transport, Parks, Digital, Recreation, Sports and Events, and Vertical Capital, following ELT endorsement.

2.         Approve budget changes over $500,000, between standalone capital projects in the Community and Major Facility delivery programme agreed in the LTP.

3.         Receive a regular quarterly briefing on project budget changes between $250,000 and $5m, approved by ELT.

4.         Recommend these delegations be reviewed and adjusted in 12 months’ time, if required.

Deputy Mayor/Councillor Cotter                                                                                                                         Carried

 

 

18. Annual Plan 2022/23 - proposed timeline and process for adopting the final Annual Plan

 

Committee Resolved FPCO/2022/00035 Officer Recommendation accepted without change

Part C

That the Finance and Performance Committee:

1.         Receive the information in the Annual Plan 2022/23 – proposed timeline and process for adopting the final Annual Plan Report

2.         Confirm the content and designated status (Elected Member Information Only, or public briefing) for briefings of 17-25 May 2022

3.         Advise any other changes to the proposed timeline to conclude the Annual Plan 2022/23.

Councillor Scandrett/Councillor Cotter                                                                                                           Carried

 

 

19. Overdue General and Rates Debtors at 31 March 2022 (Greater than $20,000 and 90 days)

 

Committee Resolved FPCO/2022/00036 Officer Recommendation accepted without change

Part C

That the Finance and Performance Committee:

1.         Receives the Overdue General and Rates Debtors (Greater than $20,000 and 90 days) report.

2.         Notes the action being taken to recover the overdue amounts.

3.         Resolves that a redacted copy of the report can be released after the Committee has received the report but the names of the individuals and organisations will remain confidential.

Councillor Cotter/Councillor Scandrett                                                                                                           Carried

 

 

23. Resolution to Exclude the Public

 

Committee Resolved FPCO/2022/00037

Part C

That at 5.10pm the resolution to exclude the public set out on pages 518 to 519 of the agenda be

Deputy Mayor/Councillor Scandrett                                                                                                                    Carried

 

The public were re-admitted to the meeting at 5.16pm.

 

Karakia Whakamutunga: Given by Deputy Mayor Turner.

 

Meeting concluded at 5.16pm.

 

CONFIRMED THIS 26th DAY OF MAY 2022.

 

Deputy Mayor Andrew Turner

Chairperson


Finance and Performance Committee

26 May 2022

 

 

7.     Christchurch Wastewater Treatment Plant Recovery Update

Reference / Te Tohutoro:

22/623427

Report of / Te Pou Matua:

Michael Croucher, Senior Programme Manager, michael.croucher@ccc.govt.nz

General Manager / Pouwhakarae:

Jane Davis, GM Infrastructure, Planning & Regulatory Services, jane.davis@ccc.govt.nz

 

 

1.   Summary

1.1       This report provides an update on the recovery activities following the Christchurch Wastewater Treatment Plant fire in November 2021. 

1.2       At the Finance & Performance Committee on 28 April 2022 it was resolved that fortnightly updates would be provided to either the Finance and Performance Committee or Council.

1.3       This report includes a summary of the activities presented by staff to the Council meeting on 12 May 2022.  It also outlines the proposed measures to support the people most affected by the odours being generated by the plant. 

1.4       Staff will provide a presentation to Council in support of this report with the activities that have been undertaken since that meeting, those currently underway and next steps.

2.   Officer Recommendations Ngā Tūtohu

That the Finance and Performance Committee:

1.         Receives the information in this update.

2.         Agrees the community support package as outlined in the report, up to the value of $1M.

3.         Notes the support package will be funded from operational surpluses.

Key activities presented to Council on 12 May 2022

Filter Media Removal Contract

2.1       Southern Demolition & Salvage Limited were awarded the contract to remove the media from the Trickling Filter structures on 11 May 2022.

2.2       Machinery began arriving on site 12 May 2022 with media removal scheduled to start 6 June 2022.

2.3       The media material is scheduled to be completely removed by early Spring 2022.

The Recovery Actions (25 March till now)

2.4       Approval to remove the filter media from the trickling Filters was received from our insurers on 25 March 2022. 

2.5       25 March – 5 April; procurement options investigated to ensure that we are still meeting requirements under Council’s procurement process and Office of the Auditor General best practice guidance.

2.6       Executive Team briefed on 6 April and decision on procurement options made 11 April.

2.7       13 April meeting with preferred contractor held to discuss requirements.

2.8       14 – 28 April; contractor securing sub-contractors and suppliers.  At same time Council staff were preparing contract documentation.

2.9       Finance and Performance Committee meeting with project briefing and deputations held 28 April.

2.10    Proposal received from contractor on 28 April, with staff review completed 2 May.

2.11    General terms and conditions of contract finalised 3 May.

2.12    Informal briefing to the Insurance Subcommittee on insurance matters given on 6 May

2.13    10 May; Insurance Subcommittee meeting (with morning site visit to CWTP).

2.14    Letter of award issued to contractor 11 May.

CWTP Interim Operations Update

2.15    The temporary aeration basins now have aerators installed and are operationally online aerating settled sewage.  The system still requires pumps to be delivered from Sweden (estimated departure date 19th May, installation end of June).  Once these pumps have been installed, the clarifiers can be brought back online and the system is then fully available.  Once this is established and stable, the biomass will begin to grow and treat the sewage, thereby replacing the treatment process which was previously undertaken by the trickling filters.

2.16    Electrical conduits, cabling and transformers and controls are being installed as they arrive from overseas.

2.17    Two additional surface aerators with supporting infrastructure have been installed on Oxidation Pond 1.

2.18    The Trickling Filter bypass pipe is nearing completion.

2.19    Underground critical services have been clearly identified to ensure that ongoing operations are not compromised with the pending removal process.

2.20    Operational documentation being tested and updated as adaptations are implemented.

2.21    Operational laboratory established, onsite mini laboratory to be used by site operations staff to provide rapid test results.

2.22    We have fast tracked the scheduled replacement of the site’s Telehandler with a more reliable unit so we can rapidly change out any aerator breakdown with a critical spare.

Environmental Monitoring

2.23    Staff have been fully trained to take air samples, which will be analysed and results published regularly in collaboration with Environment Canterbury and Community and Public Health.

2.24    Regular scheduled meetings with specialists from Environment Canterbury and Community and Public Health have been set up to ensure cross agency collaboration on public health and environmental issues.

2.25    We are also engaging with external specialists to provide assessments and advice on monitoring results.

Insurance Cover

2.26    The Waste water treatment plant is insured under the Council’s above ground asset policy which covers material damage and business interruption insurance.

2.27    The Trickling Filters have an insured value of $90 million.

2.28    Business Interruption cover of $10 million is available for increased costs of operations and $5m for assessing and preparing claims.  $10m initial payment received late November 2021.

Future Process Options Assessment

2.29    A consultant was appointed late April to undertake an options assessment for replacement of the Trickling Filters.  The work will be delivered in four packages; establishment of treatment plant capacity baseline (pre-fire), new technology options from around the world to replace the Trickling Filters, assessment of options for best reduction in greenhouse gas emission and options assessment for increased treatment capacity to accommodate future population and business growth.

2.30    The consultant will also be asked to investigate treatment options that would not require discharge to a water body.

Community Support

2.31    Council was invited to attend a community led meeting on 13 May at Bromley community centre.

2.32    Wellbeing workshops have been promoted to be run by an independent health provider on 25 May and 1 June.

Our Communication Approach

2.33    A flyer was distributed to over 3,000 immediate households in the neighbourhood surrounding the treatment plant.

2.34    Half page advertisements were running in local suburban papers containing the same information as the flyer.

2.35    Three Newsline and three e-newsletters have been published.

2.36    Air quality findings and report was published on the Council’s website.

Reporting

2.37    We are reporting fortnightly to Council and Finance & Performance Committee meetings covering the operational status of the plant, actions taken since the last report, actions underway and next steps.

2.38    Monthly reporting to the Insurance Subcommittee covering contractor performance and detailed reporting on insurance matters.

2.39    We will also be reporting to Health & Safety and Audit & Risk Committee meetings on matters relating to health and safety and risk.

3.   Proposed Community Support Package

3.1       At its 28 April 2022 meeting, the Finance and Performance Committee noted the impact of the odour from the treatment plant on residents and requested advice from staff on ways that support could be provided (FPCO/2022/00018).

3.2       Councillors asked that this advice include the establishment of a fund to support the provision of financial support to residents most affected by the odour.  At a community meeting on 13 May 2022, residents also asked for support to alleviate what they described as financial and psychosocial impacts of the odour.  Councillors present at the community meeting reiterated their desire to provide assistance to alleviate some of the burden on the residents.

3.3       Council has worked with community and government partners to identify a process to:

a)     Provide financial support for households most affected by the odour.

b)     Provide information and connections to other support available in the community

c)     Facilitate access to information.

3.4       It is proposed that Council provides a small financial contribution to households in the most affected area (3018 households).  This area is bounded by Buckleys Road, Pages Road, State Highway 74, and Linwood Avenue.  In exceptional circumstances other people just outside the defined area affected by the odour may receive some support, but this will be determined on a case by case basis.

3.5       The contribution is to assist covering costs for residents related to the odour, including laundry services, doctor appointments, vet appointments, heat pump cleaning, the purchase of appliances and firewood, and increased power use.  There will be controls put in place to ensure only those eligible will receive the support.  There will be an audit trail created.

3.6       Community partners will allocate the funding, on request from households. 

3.7       Council considered providing this support via a rates rebate but this is not proposed as it would target property owners rather than all residents (i.e. renters).

3.8       The community support package also includes working with local schools, early childhood education providers and community agencies to provide other support and activities to mitigate the stress on the community and ensure access to information.

3.9       It is proposed that up to $1 million be allocated from the forecast surplus in the F22 budget to the community support package.  Staff will provide more details of the support package at the Finance and Performance meeting.

3.10    Partners are lined up to provide this service directly to claimants on confirmation of the recommended funding amount and source of funds, anticipating this would be available from 30 May 2022.

4.   Current activities and Next Steps

4.1       A presentation from staff will be provided at the meeting on the activities that have been undertaken since the Council meeting on the 12th of May and the next steps.

 

5.   Attachments / Ngā Tāpirihanga

There are no attachments for this report.

 

In addition to the attached documents, the following background information is available:

Document Name

Location / File Link

Not applicable

 

 

 

Confirmation of Statutory Compliance / Te Whakatūturutanga ā-Ture

Compliance with Statutory Decision-making Requirements (ss 76 - 81 Local Government Act 2002).

(a) This report contains:

(i)  sufficient information about all reasonably practicable options identified and assessed in terms of their advantages and disadvantages; and

(ii) adequate consideration of the views and preferences of affected and interested persons bearing in mind any proposed or previous community engagement.

(b) The information reflects the level of significance of the matters covered by the report, as determined in accordance with the Council's significance and engagement policy.

 

 

 

Signatories / Ngā Kaiwaitohu

Author

Michael Croucher - Senior Programme Manager

Approved By

Jane Davis - General Manager Infrastructure, Planning & Regulatory Services

 

 


Finance and Performance Committee

26 May 2022

 

 

8.     Key Performance Results April 2022

Reference Te Tohutoro:

22/578534

Report of Te Pou Matua:

Peter Ryan, Head of Performance Management, peter.ryan@ccc.govt.nz

General Manager Pouwhakarae:

Lynn McClelland, Assistant Chief Executive
lynn.mcclelland@ccc.govt.nz

 

 

1.   Brief Summary

1.1       The purpose of this report is to track delivery of organisational performance priorities set out in the 2021-31 Long Term Plan, to target and within budget. The key organisational performance measures include:

1.1.1      Service delivery

1.1.2      Capital projects (planning and delivery)

1.1.3      Finance

1.2       Organisational performance forecasts as at 30 April 2022 show decline for Level of Service and both capital project delivery targets. The capital planning FY2024/25 target remains stable, while FY2023 target has been met. The operating budget remains positive and stable while capital programme financial performance continues to decline.

1.3       This remains a relatively positive series of forecasts, given the impacts of COVID-19 on level of service delivery. There are also supply chain delays impacting Council’s capital programme delivery. These effects are being felt nationwide.

1.4       The minor forecast variations from previous years for these results shows that Council’s mitigation strategies to deal with Covid-impacts have been largely successful to date.

2.   Officer Recommendations Ngā Tūtohu

That the Finance and Performance Committee:

1.         Receives the information provided in the Key Performance Results for March 2022.

 

3.   Service delivery

ELT Goal: Deliver 85% Community Levels of Service to target

 

3.1       Community levels of service (LOS) year-end forecast as at April is 79.3% against the performance target of 85%. This is a decline of 3.3% from March 2022.

3.2       This April forecast is 3.4% below the result from this time last year and lower than last year's final result (81.6%).

3.3       The restrictions of COVID-19 response levels (New Zealand remains at ‘Orange’) continue to impact the number of people using the Council’s facilities, services and programmes, such as Art Gallery, Akaroa Museum, Libraries, Recreation and Community Centres.

3.4       Impacts are also noticeable in some regulatory services, such as increases in consent volumes leading to delays in consent processing. Extensive effort around recruitment and contracting has been underway for some time to provide the additional capacity needed.

3.5       This year’s resident satisfaction surveys were released during the month with 25 of 38 survey questions achieving target.

3.6       For further details regarding LOS exceptions, refer to managers’ comments in Attachment A.

3.7       The scatter diagram below is an overview of the performance of the top-ten activities as at April 2022.

3.7.1      The vertical y-axis shows service delivery (LOS) performance. 

3.7.2      The horizontal x-axis shows budget over/underspend.

3.8       Since the beginning of this financial year, the majority of activities continue to cluster around the ‘sweet spot’ – delivering their LOS to target and on budget.

3.9       Similar to March reporting, the activities requiring focus are Transport, Water Supply, Solid Waste and Resource Recovery, Recreation, Sports, Community Arts and Events and Parks Heritage and Coastal Environment

4.   Capital projects, planning and delivery

ELT Goal: Deliver 90% Watchlist capital projects to ‘delivery complete’ milestones

ELT Goal: Deliver 85% non-Watchlist capital projects to ‘delivery complete’ milestones

4.1       Watchlist project performance is forecast at 85.3% (target 90%), this is a decline of 2.9% from the March report but well ahead of the previous year’s forecast at the same period. A total of 5 projects are forecast to not meet milestone baseline target date.

4.2       Forecast Non-Watchlist project delivery has declined to 77.4% (target 85%).

4.3       Supply chain delays and construction price escalation remain a concern nationwide and are risks to the delivery of the Council’s capital programme.

4.4       For further information and underlying detail, refer to the detailed Capital Project Performance Report April 2022.

 

 

Forward view of capital delivery performance for the LTP (financial)

4.5       This is an overview of capital delivery in the last three years against plan, plus capital delivery planned for the first three years of the LTP 2021-31.

 

4.6       Figures are updated for 2022/23 and 2023/24, per the adopted Draft Annual Plan (24 February 2022).

4.7       There has been stability of delivery year-on-year for projects CCC is responsible for delivering (green line – total spend), ranging consistently between $390m to $409m spend per annum over the previous 3 years.

4.8       For this year (year 1 of the LTP 2021) the total programme amount set for CCC to spend (core plus externally funded) was $487m. This excludes spend for projects CCC is not responsible for – Parakiore and Te Kaha/CMUA.

4.9       The April 2022 forecast for capital delivery (core plus externally funded) in the Finance Report is $350m which equates to 71.9% of the capital budget. This excludes Parakiore and Te Kaha/CMUA).  (Note this refers to % capital spend, as distinct from capital milestone delivery % in 4.1 and 4.2)

4.10    Under the Draft Annual Plan 2022/23, future year’s CCC delivery programmes for 2022/23 and 2023/24 are currently set at $498m and $565m (blue line – again excluding Te Kaha and Parakiore).

4.11    This means there are clear risks around deliverability for these future years, given the consistency of spend these last 4 years (approx. $400m pa), plus the challenges of supply of materials, skills, and cost escalation that will impact both 2021/22 and 2022/23, and potentially the years beyond.

4.12    For more detail refer to the Financial Performance and PMO Reports April 2022.

 

ELT Goal: Ensure capital planning for FY23 funding programme budgets allocated,
90% by 1 March 2022.

ELT Goal: Ensure capital planning for F24 & FY25 funding programme budgets drawn down, 90% by 1 May 2022.

4.13    Capital planning targets are intended to monitor the draw-down of capital funding programme budgets in years 2, and 3 and 4 of 2021-31 LTP. This helps the business plan and prepare for future capital project delivery, in order to effectively implement the LTP.

4.14    95.3% of FY 2022/23 funding programme budgets have been allocated, meeting the target for 90% projects initiated to be allocated by 1st March 2022.

64.8% of FY2024/FY2025 funding programme budgets has been drawn down in CPMS. The target is for 90% funding programme budgets drawn down by 1st May 2022. There remains some time for the business to achieve target.

5.   Finance

ELT Goal: Demonstrate value for money and actively manage our operational budgets.

ELT Goal: Deliver overall capital programme to approved budget, =/ -10%.

5.1       There is currently a $23.1 million surplus forecast for the year.

5.2       The operational surplus is currently $32.2m better than budget, forecast to reduce to   30.3m ($23.1m after signalled carry forwards). The forecast (after signalled carry forwards) has improved slightly by $0.7m from last month.

5.3       Capital programme is forecast variance at -24.4% (based on project manager forecasts), outside the organisations performance target of between 0% to -10%. More detail is available in the Capital Programme Performance Report.

 

 

Attachments Ngā Tāpirihanga

No.

Title

Page

a

LOS Exceptions Commentary April 2022

34

 

 

Additional background information may be noted in the below table:

Document Name

Location / File Link

Nil

Nil

 

 

 

Confirmation of Statutory Compliance Te Whakatūturutanga ā-Ture

Compliance with Statutory Decision-making Requirements (ss 76 - 81 Local Government Act 2002).

(a) This report contains:

(i)  sufficient information about all reasonably practicable options identified and assessed in terms of their advantages and disadvantages; and

(ii) adequate consideration of the views and preferences of affected and interested persons bearing in mind any proposed or previous community engagement.

(b) The information reflects the level of significance of the matters covered by the report, as determined in accordance with the Council's significance and engagement policy.

 

 

 

Signatories Ngā Kaiwaitohu

Author

Johan Jacobs - Senior Business Analyst

Approved By

Peter Ryan - Head of Performance Management

Lynn McClelland - Assistant Chief Executive Strategic Policy and Performance

  


Finance and Performance Committee

26 May 2022

 













Finance and Performance Committee

26 May 2022

 

 

9.     Financial Performance Report - April 2022

Reference Te Tohutoro:

22/491571

Report of Te Pou Matua:

Bruce Moher, Acting Head of Finance, bruce.moher@ccc.govt.nz

General Manager Pouwhakarae:

Leah Scales, General Manager Resources/CFO, leah.scales@ccc.govt.nz

 

 

1.   Brief Summary

1.1       The purpose of this report is for the Finance and Performance Committee to be updated on financial performance to 30 April 2022, including the current full year forecast, and to receive information relating to the Council’s treasury and debtors risks, and insurance notifications.

1.2       Financial results to date and forecast remain positive.

1.3       The Treasury funding policy is in temporary breach, as signalled in the March 2022 Report and described in section 7.  All other treasury risk positions are within policy limits.

1.4       There was a decrease in rates and general debt during the month.

1.5       There were no material insurance issues for the month.

 

2.   Officer Recommendations Ngā Tūtohu

That the Finance and Performance Committee:

1.         Receives the information in the Financial Performance Report for April 2022.

2.         Notes the breach of the Funding risk policy limit, likely until September/October 2022 and the staff advice supporting it.

3.   Key Financial Statistics

A 1% increase in interest rates would cause a 3% rates increase, which is why we hold a lot of our debt at fixed rates  

What causes a 1% rates increase?
 
$5.9m of opex or $95m of capex

         

    

Historic and projected gross debt level

 

4.   Financial Overview

4.1       Financial information reported covers two key areas.

4.1.1   Operational (expenditure and revenue) covers the day to day spend on staffing, operations and maintenance, and revenues.

4.1.2   Capital covers the capital programme spend and funding relating to it.

4.2       The forecast operating surplus has increased slightly ($0.7 million) from that reported last month to $23.1 million. It is driven by Recreation and Sport COVID revenue exposure reducing $0.3 million, with smaller various savings forecast throughout the organisation contributing to the remainder.

4.3       $1.55 million of the above forecast surplus needs to be applied to the COVID-19 Business Recovery Plan approved by Council.

4.4       The intention is to recommend use of $7.25 million of the forecast surplus to avoid the current year’s planned COVID borrowing.

4.5       After applying sections 4.3 and 4.4 above the surplus reduces to $14.3 million. It is recommended that $4.1 million of this is applied against repayment of remaining COVID debt.

4.6       COVID-19 Restrictions Impact - the following are the material expected forecast impacts, an improvement of $0.3 million from the March report reflecting the reduced revenue exposure in Recreation and Sport. The overall Council COVID impact is now forecast at $6.1 million.

Activity

Reduced Revenue

($m)

Expenditure Impacts

($m)

Recreation & Sport

Entry/Usage fees

Casual rentals/hire revenues

1.8

0.3

 

Additional security

Event cancellations

Casual Labour decrease (lockdown period)

0.3

(0.2)

(0.1)

Libraries

Lower fees & charges/facility hire/rent relief

0.5

Additional security

0.4

Parks

Lower shop sales & rental relief

0.4

Lower stock purchases

(0.1)

Art Gallery

Lower shop sales/donations/facility hire

0.2

 

 

Citizen & Customer Service

NZ post revenues decrease

0.1

 

 

Community Development

Community Facilities hire revenues

0.1

 

 

Transport

Decrease in fines

Parking

Rental relief

  1.0

  0.9

0.2

 

 

Corporate/Internal services

Petrol Tax

0.1

Temporary staff costs/Masks/

Rapid tests/Legal

0.2

Total Revenue Impact

5.6

Total Expenditure Impact

0.5

4.6.1   Favourable forecasts across other areas of the organisation cover the above impact.

5.   Operational Position

5.1       Operational revenue exceeds expenditure as it includes rates revenue for capital renewals and debt repayment. This revenue is referred to below as ‘Funds not available for Opex’ and removed from the Operational result below.


Year to Date Results

Forecast Year End Results

After Carry Forwards

$m

Actual

Budget

Var

 

Forecast

Budget

Var

 

Carry Fwd

Var

 

Revenues

(767.5)

(741.7)

25.8

 

(822.4)

(793.3)

29.1

 

-

29.1

 

Expenditure

507.5

513.7

6.2

 

616.4

621.8

5.4

 

10.6

(5.2)

 

Funds not available for Opex

176.2

176.4

0.2

 

175.7

171.5

(4.2)

 

(3.4)

(0.8)

 

Surplus

(83.8)

(51.6)

32.2

(30.3)

-

30.3

7.2

23.1

5.1       Brief summaries of the surplus, revenues, and expenditure are highlighted below.

Surplus

The operational surplus is currently $32.2 million better than budget, forecast to be $30.3 million by year-end ($23.1 million after signalled carry forwards). Major carry forwards signalled in the forecast include the claims preparation and management of legal proceedings ($3.4 million – borrowed for rather than rates funded), holiday pay remediation payments ($3.3 million), operational costs associated with the earthquake repair programme ($1.1 million), and Rockfall grants to cover future claims ($0.9 million). Smaller carry forwards contribute to the remainder of the $10.6 million forecast.

Key forecast result drivers after carry forwards:  

Higher subvention receipts ($9.2 million), Recycling processing fee savings and prior year rebate ($6.4 million), favourable net interest/dividend revenues ($4.6 million), higher Regulatory and Compliance volumes ($4.5 million – net of resourcing costs), higher rates revenue ($2.8 million), personnel savings ($2.6 million), Burwood Landfill continued operations ($1.7 million), and insurance savings ($1.1 million).

Partially offset by COVID-19 restrictions impacts ($6.1 million), additional remediation costs for Le Bons Bay Landfill ($1.7 million), and higher refuse disposal fees ($1.6 million).

Revenues

Revenues are $25.8 million higher than budget year to date - forecast to be $29.1 million higher at year end. Below are the key drivers of these variances:

 

                                                                                                                                                                               YTD                  Forecast

Regulatory & Compliance revenues (driven by higher building/resource consent volumes)              $9.9m                 $10.8m

Higher subvention receipts than planned                                                                                           $9.2m                   $9.2m

Increased Burwood Landfill revenues (due to continuing operations)                                               $3.4m                   $3.2m

Rates Revenues (2020/21 rating growth higher than planned)                                                                    $3.2m                   $2.8m

Interest Revenues (higher interest rates and cash on hand)                                                                        $3.0m                   $3.7m

Higher Transwaste dividends received                                                                                                 $2.1m                   $2.1m

EcoCentral Recycling Processing fee rebate received (relating to prior years)                             $1.4m                   $1.4m

Timing of Excess Water/Trade Waste revenues                                                                              ($1.5m)                        -                      

COVID-19 revenue impacts                                                                                                                      ($4.7m)                  ($5.6m)

Expenditure

Expenditure is $6.2 million lower that budget year to date and forecast to be $5.4 million lower at year end before carry forwards ($5.2 million higher after budget carry forwards).

 

Key variance drivers:                                                                                                                                   YTD                  Forecast
(after c/f)

Recycling processing fee savings (net of increased disposal of contaminated loads)                          $3.7m                    $3.4m

Timing of grant payments                                                                                                                          $2.4m                         -

Lower Personnel costs (excl. Regulatory & Compliance shown below)                                                                $2.3m                    $2.6m

Parks expenditure (Red zone delay in transfers/managing costs to cover COVID related revenue loss)  $1.9m                    $0.6m

Three Water activities behind budget spend (timing of Water Reform programme spend)           $1.1m                         -

Lower insurance premiums                                                                                                                       $1.0m                    $1.1m

Earthquake repair programme opex related costs to be carried forward                            $1.0m                        -

Recreation & Sport expenditure timing (forecast offset by grant/subsidies revenues received)      $0.7m                  ($0.5m)

Higher debt servicing costs (due to higher interest rates – offset by revenues)                                     ($0.5m)                ($1.2m)

Le Bons Bay Remediation (increased costs due to additional material found)                                      ($0.9m)                ($1.7m)

Burwood Landfill operation costs (continued operation – offset by revenues)                                  ($1.2m)                ($1.7m)

Transport expenditure (YTD due to earlier maintenance – forecast  post rain event repairs)                ($1.5m)                ($0.5m)

Higher Regulatory & Compliance resourcing costs (offset by revenue volumes)                         ($5.2m)                ($6.3m)

Procurement savings (unlikely to be found due to inflation impacts & living wage decision)                           -                        ($0.7m)                                               

Funds not available for Opex

Forecast reduction from surplus of $0.8 million after carry forwards is due to a better Housing ($0.3 million) and Dogs ($0.1 million) forecast result (both non-rates funded) and $0.4 million relating to the Bexley Landfill Remediation project (rate funded capital project).

6.   Capital Position


Year to Date Results

Forecast Year End Results

After Carry Forwards

$m

Actual

Budget

Var

 

Forecast

Budget

Var

 

Carry Fwd

Var

 

Core Programme

228.3

288.5

60.2

 

318.6

413.9

95.3

 

95.3

-

 

External Funded Programme

36.9

55.7

18.8

 

50.2

72.8

22.6

 

22.6

-

 

Less unidentified Carry Forwards

-

-

-

 

(18.8)

-

18.8

 

18.8

-

 

Core/External Funded Programme

265.2

344.2

79.0

350.0

486.7

136.7

136.7

-

Te Kaha/Parakiore

53.8

75.2

21.4

 

73.6

119.4

45.8

 

45.8

-

 

Total Capital Programme

319.0

419.4

100.4

 

423.6

606.1

182.5

 

182.5

-

 

Revenues and Funding

(265.2)

(286.9)

(21.7)

 

(299.2)

(301.2)

(2.0)

 

(17.5)

15.5

 

Borrowing required

53.8

132.5

78.7

124.4

304.9

180.5

165.0

15.5

Capital Expenditure

6.1       Gross capital expenditure of $319 million has been incurred year to date. A further $104.6 million is forecast to be spent by year end.

6.2       The $423.6 million forecast spend is based on a Core/External Funded spend of $350 million, plus forecast spend of $73.6 million on Te Kaha and Parakiore projects.

6.3       Project managers have identified $163.7 million relating to specific projects forecast to be carried forward. The forecast includes an additional $18.8 million of expected carry forwards yet to be specifically identified (forecast based on actuals to date and historical trend analysis).

6.4       The Draft 2022/23 Annual Plan includes an assumed total $50 million carry forward. This forecast has been revised to approx $175 million for the Final as presented in recent briefings.

6.5       For further information on capital, please refer to the Capital Programme Performance Report.

Capital Revenues and Funding

6.6       Year to date capital revenues and funding are $21.7 million behind budget, due to timing of Crown revenues reflecting slower spends in Shovel Ready, Te Kaha and Water Reform projects. A carry forward of $16.8 million is forecast for Crown revenues.

6.7       Forecast after carry forwards are $15.5 million higher largely driven by additional drawdowns forecast for development contributions ($7.5 million) due to higher contributions received, budgets not required for development contribution rebates ($4.5 million) due to closed schemes with balances remaining, and higher water connection fees ($2.2 million).

6.8       The lower current year borrowing requirement forecast of $180.5 million comprises $182.5 million for capital programme carryforwards (timing), and permanent lower borrowing of $15.5 million due to the higher capital revenues outlined in 6.7 above.

7.   Treasury

Borrowing & Advances to Related Parties

7.1       Council’s borrowing and treasury-related Advances are shown below:

7.2       There have been minor changes since last month, relating to the refinance of debt maturities in April.

7.3       Rates-funded debt is expected to remain materially unchanged this financial year – net outflows from operations and capital investment will be funded by existing cash holdings.

Policy Compliance

7.4       All Treasury risks are within Policy limits:

Risk Area

Compliance

Liquidity Risk

Yes

Funding Risk

Breach

Interest Rate Risk

Yes

Counterparty Credit Risk

Yes

 

7.5       Funding Policy Breach:  This breach was signalled in the March 2022 Report and discussed at the April 2022 F&P Committee meeting.  It is caused by an inadequate amount of debt maturing beyond 7 years ($181m actual, vs. $232m policy minimum), and will be corrected when the capital programme requires new borrowing to be incurred (expected around September / October 2022).  There is no impact on Council’s interest costs or risks.

Funding & Interest Rates

7.6       Council’s projected funding needs per financial year are shown in the chart below, split between the maturity of existing gross borrowing (green) and expected new borrowing requirements (grey).  There is a significant concentration risk in the 2024 year, which is subject to on-going management.

7.7       Council’s interest rate risk is managed, to reduce the volatility of interest costs from year to year.  Most existing debt has been fixed for at least the next three years, which will limit the impact of recent market interest rate increases on Council’s future borrowing costs.

8.   Rates and General Debt

8.1       Rates debt decreased $3.5 million this month and General debt decreased $26.2 million as shown in the table below. General debt at March month end included a Crown invoice for $28.8m relating to Te Kaha (CMUA), which was paid on 1 April.

$m

March

Current

Change

Comment

Rates Debt

21.0

17.5

(3.5)

 

Overdue rates for current year

19.0

15.7

(3.3)

Instalment 4 not due until May & June

Arrears from previous years

2.0

1.8

(0.2)

 

General Debt

34.7

8.5

(26.2)

A $28.8m Crown contribution for Te Kaha was outstanding in March and was paid on 1 April 2022

(less than 30 days)

33.9

7.3

(26.6)

As above

(between 30 – 90 days)

0.4

0.9

0.5

-

(greater than 90 days)

0.4

0.3

(0.1)

-

 

8.2       General debts of $0.12 million have been written-off year to date, and $6k in the April month of which $5k related to libraries debt.

8.3       A summary report of debtors written-off in 2021/2022 by month is provided as Attachment A.

8.4       The graph below shows 90+ days rates debt as a percentage of the annual rates strike that year, with a three month moving average to smooth the quarterly cycle, and indicates that rate arrears are well in hand.

 

9.   Insurance Claims

The table below outlines the number of events that have been notified by Council against its insurance policies as well as claims against Council from third parties during April 2022.

 

Policy

Claims / Notifications

Estimated Cost

Above excess

Below excess

Claims by Council

Motor Vehicle

0

0

$0

 

Material damage

0

0

$0

Claims against Council

PI / PL

0

0

$0

 

9.1       CWTP fire claim - updates on this claim will be reported to the Insurance Subcommittee. CWTP plant recovery updates are being provided fortnightly to Finance and Performance Committee and Council.

 

Attachments Ngā Tāpirihanga

No.

Title

Page

a

Debtors Written Off Summary 30 April 2022

56

 

 

Additional background information may be noted in the below table:

Document Name

Location / File Link

Nil

Nil

 

 

 

Confirmation of Statutory Compliance Te Whakatūturutanga ā-Ture

Compliance with Statutory Decision-making Requirements (ss 76 - 81 Local Government Act 2002).

(a) This report contains:

(i)  sufficient information about all reasonably practicable options identified and assessed in terms of their advantages and disadvantages; and

(ii) adequate consideration of the views and preferences of affected and interested persons bearing in mind any proposed or previous community engagement.

(b) The information reflects the level of significance of the matters covered by the report, as determined in accordance with the Council's significance and engagement policy.

 

 

 

Signatories Ngā Kaiwaitohu

Authors

Ryan McLachlan - Reporting Accountant

Andrew Jefferies - Manager Rates Revenue

Steve Ballard - Group Treasurer

Brett Hales - Manager Transactions

Adrian Seagar - Insurance & Asset Manager

Martin Zelas - Team Leader Rates

Approved By

Bruce Moher - Acting Head of Finance

Leah Scales - General Manager Resources/Chief Financial Officer

  


Finance and Performance Committee

26 May 2022

 


Finance and Performance Committee

26 May 2022

 

 

10.   Capital Programme Performance Report - April 2022

Reference / Te Tohutoro:

22/643335

Report of / Te Pou Matua:

Andrew Robinson, Head of Programme Management Office

General Manager / Pouwhakarae:

Lynn McClelland, Assistant Chief Executive

 

 

1.   Brief Summary

1.1       The purpose of this report is for the Finance and Performance Committee to be informed of Capital Performance for period ending 30 April 2022 and the outlook for coming months.

1.2       It has been an extremely difficult year for capital delivery with the cascading effects of Covid, international supply chain issues, and cost escalation having an effect across all areas of capital delivery.

1.3       While it is challenging to make accurate predictions as to the time period within which these broader issues outside of Council control will resolve, internal planning and risk mitigation is based on the assumption that a return to normal is not expected in the short term, and a two year adjustment is expected at a minimum.

1.4       The capital programme in the major facilities area accounts for the bulk of the non-delivery of total capital budget.  The large scale projects of Te Kaha, Parakiore, Performing Arts Precinct and Hornby Community Centre all require major adjustments to the expected budget phasing over the coming years.

1.5       Change in the scope (potential location) of the Organics Processing Plant has delayed any possible capital expenditure for this project.

1.6       The capital programme for the Transport area will underperform by a significant margin this financial year.  Two major areas were the carriageway reseal programme not being able to fully deliver its programme of work due to adverse weather, works planning and Covid impacts at the back end of the sealing season.  Delays with the cycleway programme caused by KiwiRail integration requirements also had an impact but collaboration is now improved.

1.7       The capital programme for the Three Waters programme held up extremely well given the risks and issues of the year, and keeping the increasing momentum of delivery in this area will be a key focus.

1.8       Planning, initiation and internal visibility of the capital programmes are continuing to make excellent progress, and this is strengthening our ability to deliver projects in the coming years to meet the large step up required to meet LTP expectations.  Focus on maintaining a strong future pipeline of defined and confirmed capital projects will be key to success.

2.   Officer Recommendations Ngā Tūtohu

That the Finance and Performance Committee:

1.         Receive the information in the Capital Programme Performance Report

 

 

 

 

Attachments / Ngā Tāpirihanga

No.

Title

Page

a

2022-05-12 Capital Delivery Report - April 2022

59

b

2022-04 Capital Watchlist Report - April 2022

90

c

2022-04 External Funded - DIA - April 2022

95

d

2022-04 External Funded Report - Shovel Ready - April 2022

100

e

2022-04 Major Cycleways Report - April 2022

107

 

 

In addition to the attached documents, the following background information is available:

Document Name

Location / File Link

nil

nil

 

 

 

Confirmation of Statutory Compliance / Te Whakatūturutanga ā-Ture

Compliance with Statutory Decision-making Requirements (ss 76 - 81 Local Government Act 2002).

(a) This report contains:

(i)  sufficient information about all reasonably practicable options identified and assessed in terms of their advantages and disadvantages; and

(ii) adequate consideration of the views and preferences of affected and interested persons bearing in mind any proposed or previous community engagement.

(b) The information reflects the level of significance of the matters covered by the report, as determined in accordance with the Council's significance and engagement policy.

 

 

 

Signatories / Ngā Kaiwaitohu

Author

Richard Wesley - Principal Advisor PMO

Approved By

Lynn McClelland - Assistant Chief Executive Strategic Policy and Performance

  


Finance and Performance Committee

26 May 2022

 
































Finance and Performance Committee

26 May 2022

 






Finance and Performance Committee

26 May 2022

 






Finance and Performance Committee

26 May 2022

 








Finance and Performance Committee

26 May 2022

 





Finance and Performance Committee

26 May 2022

 

 

11.   Te Kaha Project - Elected Member Update

Reference Te Tohutoro:

22/205418

Report of Te Pou Matua:

David Kennedy, Chief Executive Te Kaha Project Delivery Limited,
David.Kennedy@ccc.govt.nz

General Manager Pouwhakarae:

Barry Bragg, Chair Te Kaha Project Delivery Limited, barry.bragg@ngaitahu.iwi.nz

 

 

1.   Brief Summary

1.1       The purpose of this report is to update Elected Members on the progress of the Te Kaha Project Delivery Limited.

2.   Officer Recommendations Ngā Tūtohu

That the Finance and Performance Committee:

1.         Receive the information in the Te Kaha Project Elected Members Update Report.

 

 

Confirmation of Statutory Compliance / Te Whakatūturutanga ā-Ture

Compliance with Statutory Decision-making Requirements (ss 76 - 81 Local Government Act 2002).

(a) This report contains:

(i)  sufficient information about all reasonably practicable options identified and assessed in terms of their advantages and disadvantages; and

(ii) adequate consideration of the views and preferences of affected and interested persons bearing in mind any proposed or previous community engagement.

(b) The information reflects the level of significance of the matters covered by the report, as determined in accordance with the Council's significance and engagement policy.

 

 

 

Signatories Ngā Kaiwaitohu

Author

David Kennedy - Chief Executive Te Kaha Project Delivery Limited

Approved By

Barry Bragg - Chair Te Kaha Project Delivery Limited

 

 

Attachments Ngā Tāpirihanga

No.

Title

Page

a

Te Kaha Elected Member Update 30 April 2022

112

 

 


Finance and Performance Committee

26 May 2022

 


Finance and Performance Committee

26 May 2022

 

 

12.   South Library Te Kete Wānanga o Wai Mōkihi - Earthquake Repair Options

Reference / Te Tohutoro:

22/529026

Report of / Te Pou Matua:

Carolyn Robertson – Head of Libraries & Information
Brent Smith – Head of vertical Capital Delivery

General Manager / Pouwhakarae:

Mary Richardson – General Manager Citizens & Community

 

 

1.   Purpose of the Report Te Pūtake Pūrongo

1.1       The purpose of this report is to update Council on the findings of the pre-project investigation into the cost and scope of repair works required to address structural damage to the South Library from the 2010-2011 Canterbury earthquake sequence and bring this facility up to 100% NBS Importance Level 3; and endorse the staff recommendations.

1.2       This report provides Council with a comparison of repair with a rebuild of this facility including supporting technical advice in relation to: geotechnical, structural, architectural, building services, legal, insurance, whole of life carbon, programme, cost, and funding implications.

1.3       In summary the investigation has revealed:

a.    The scope of repair required to address the structural damage at the South Library is more extensive than previously thought.

b.    The extent of fabric replacement required for a repair is almost equivalent to a rebuild.

c.    The complex repair has a high level of risk and unknowns in terms of time, cost and quality.

d.    There are significant benefits to a rebuild including; energy efficiency, comfort, reduced operational and maintenance costs, lower whole of life carbon assessment, lower capital cost, more surety of construction programme, better contractual terms and associated warranties & guarantees.

e.    Because of the anticipated length of closure we recommend setting up a temporary facility in the area if feasible.

f.     The cost estimate for repair exceeds the $13.6 million of CAPEX funds on plan.  The project will require a (future) bid for construction capital and operating funds for temporary facility in Annual Plan 2023-2024.

g.    Staff recommend a rebuild of this facility.

1.4       The decision in this report is of low significance in relation to the Christchurch City Council’s Significance and Engagement Policy.  The level of significance was determined by:

1.4.1   Noting that the decision to repair the earthquake damaged South Library has already been made on 04 August 2016.  This is included in the current Long Term Plan 2021-2031.

1.4.2   The recommended resolution is that staff advance the design of the repair or rebuild to ‘concept’ and validate the cost estimate before returning to Council in Q1 2023 for a decision to progress the project.

1.4.3   There is sufficient Operating & Capital budget already on plan to develop the concept design and associated cost estimate.

1.5       In terms of gauging the views and preferences of interested and affected persons, consultation will be undertaken with the current stakeholders, community groups, and also members of the local community to take all suggestions put forward into consideration during the planning and design phases of the project.

 

2.   Officer Recommendations Ngā Tūtohu

That the Finance and Performance Committee:

1.         Direct staff to progress the design for a rebuild of the South Library Facility on its existing site.

2.         Endorse the development of a concept design and costing for consideration by Council in Q1 2023.

3.         Note that the advancement of the project to construction will require additional funding in Annual Plan 2023-2024 and or a Long Term Plan adjustment.

 

3.   Reason for Report Recommendations Ngā Take mō te Whakatau

3.1       Rebuild on the existing site:  The preferred option, recommended by staff is the rebuild of the facility on the existing site for the following reasons.

3.2       There is now an opportunity for Council to review the rationale of a repair vs. new build option and make sure that the right long-term choice is made.  In scoping the repair consideration has been given to the following key factors:

a.      Long term performance of the building

b.      Possible future change to the building use including the opportunity to improve function or the complete scope of issues with the original (pre-quake) design

c.      Building Code Compliance

d.      Recommendation of ‘Heathcote river flooding report” and the impact of any possible underfloor or road flooding

e.      The cost of temporary accommodation & relocation while works are carried out

f.       The insurability of the repaired building

g.      The complexity of contracts for the repair works including warranties for works

h.      The (current day) difference in cost between a repair and a full replacement

3.3       Functionality: A preliminary workshop was held with Council staff who manage and occupy the building on both the functionality and future operational requirements.  The results of this indicated that the facility provides sufficient floor area but the use of the space is inefficient.  With wholesale changes to interior fabric required for repair or rebuild, there is an opportunity to optimise building function and efficiency, providing best value for future library and community use.

3.4       Geotechnical:  Modelling and a preliminary site investigation, Attached A & B, to inform the structural solution for repair.  Modelling has revealed that the site is low risk for lateral spread but prone to liquefaction in the deep soil layers below the water table.  This means that (shallow) ground improvement is not beneficial and in future seismic events the building will be prone to further differential settlement.

3.5       Structural Engineering: A high level structural repair design to inform the cost estimate for repair, Attached C.  The scope of repair will include the foundations and floor slabs.  A raft slab is recommended as this gives good seismic resilience and is simple to design and construct.  The new slab can be placed on top of the existing foundation and floor slabs avoiding the need to excavate & dump the existing fabric.  This saves money & time, minimises excavation of contaminated ground, provides the opportunity to raise the floor level to mitigate flood risk and comply with current flood level requirements.

The internal pre-cast concrete walls are quake prone and the engineer recommends removing these to reduce the seismic load on the building.  Given the existing floor will be covered by a new slab, all of the internal walls and finished will need to be replaced.

3.6       Architectural :  Advice has been provided in relation to the reuse of fabric, the interface of the new structural elements with existing building elements and code compliance, Attached D.  South Christchurch Library is approaching a 20-year life span, which brings several building elements to their considered “end of life” and will require replacement in the near future.

The necessary structural repairs require building consent, and due to Building Code changes since the building was consented and constructed, elements of the building design and fabric will require upgrade.

A patch work repair to the system is unattainable with a high level of risk and unknowns outweighed by the benefits of a new system.  A new façade system to the outside line of the new steel will provide continuity and simplification of the construction and sequencing with the roof replacement.  This solution will remove the risk of any residual earthquake damage and any potential weather tightness issues caused by the condition of existing system.  A new continuous façade system will also have a positive impact on the thermal performance of the building and internal comfort level.

3.7       Building services:  The heating ventilation and cooling (HVAC) system is approaching the end of its useful working life and would become redundant in the repair and rebuild scheme.  The current & ongoing issues with sewer and HVAC can be addressed in the repair or rebuild scope.

3.8       Whole of life carbon: An assessment has been prepared in accordance with EN 15978 (2011), Attached E.  The carbon assessment makes comparisons against Council’s Ōtautahi Climate Resilience Strategy (issued 2021).

The assessment shows repair offers a greater level of re-lifting to existing building fabric while a new build offers the greatest potential to improve the environmental impact of the structure, thermal performance, servicing strategy, comfort and daily performance of the building.

3.9       Insurance: In order for Council to be in the best possible insurance position going forward we would need a repair strategy that rectifies all the existing earthquake damage and is able to be consented under the Building Act.  There are specific clauses in Council's insurance policy that state any damage that existed at the start of the policy period (i.e. unrepaired EQ damage) is not covered in another event, regardless of cause.  All repairs must comply with Building Act where applicable. A rebuild means that full insurance cover can be obtained to replacement value and the Building Act complied with as matter of course.

3.10    Legal:  The legal advice is consistent with the insurance position in that a rebuild is considered to be more straightforward than a repair.  A repair is inherently more difficult to scope because of unforeseen damage which results in less contractual certainty and more potential for cost & time overrun.  There are also issues with risk & liability in relation to old & new fabric and consents.  A rebuild offers greater certainty for scope and cost, tighter contractual terms.  There is also more programme certainty.

3.11    Cost: There is currently a CAPEX budget of $13.6 million on plan for the period FY22-27.

The cost estimate for the proposed repair and a cost estimate for an equivalent new build on the same footprint is repair $26.6 million vs. new build $24.9 million, Attached F.

This is an early concept level cost estimate but gives a clear indication that the cost of repair will exceed the allocated funds.  This is because the updated scope of repair is more extensive than the “do-minimum” repair option selected in 2016 and associated prices have escalated significantly since the previous estimate was prepared.

The cost of repair exceeds the cost of a new build because of the complexity and inefficiency of construction within an existing building.  In addition to this base cost estimate we would expect that the project contingency needed for repair would also be a higher than that of a new build.

These cost of repair and new build are similar because the extent of fabric replacement required in the repair is almost equivalent to a full replacement.  In the case of repair, all of the interior and much of the exterior building fabric requires replacement.

3.12    Programme: Council previously deferred this repair project through a previous Long Term Plan, so it could be sequenced to occur after the new Hornby Centre opens in 2023 and ensure that another facility was available within the libraries network.

Following a decision by Council on repair of new build the project will enter the design phase, followed by construction (Council approvals & funds permitting) in calendar year 2024.  It is estimated that the repair or new build would take about 18 months.  A construction timeline will be confirmed once the scope, funding and procurement plan is confirmed.  No start date has been set.

 

4.   Alternative Options Considered Ētahi atu Kōwhiringa

4.1       Repair – of the existing building (not recommended)

Advantages

·    Community perception that a much used and loved facility is not demolished and replaced

Disadvantages

·      The working structure of the building needs to be replaced and with it all of the internal and much of the exterior fabric.  The remaining roof structure and the south wall could be reused but will compromise the design and function of the repaired building

·      May pose warranty, building compliance and insurance issues.

·      The repair is more expensive in terms of capital outlay

·      The repair will have a higher operating cost due to the inefficiency of the thermal envelope and constraints on heating and ventilation services. 

·      In addition although the repair brings the building strength back to 100% NBS, this is a life safety rating and the repaired building will not be as resilient as a new build.

4.2       Rebuild on the existing site but adjacent to current facility, (rather than on the same footprint.) (not recommended)

Advantages

·      The existing facility could be decommissioned once the new one was operational avoiding the need to establish a temporary facility – saving $211,000 facility costs.

Disadvantages

·      The existing facility would be operating immediately adjacent to the construction zone which does not leave sufficient safe working space for construction and puts users at risk by placing them in close proximity to the construction site.

·      The existing slab could not be reused which would add approximately $1 million of cost to the build as well as impacting the carbon footprint.

·      The available ground space on the site would force the new building footprint to be smaller than the existing one and compromised in terms of functionality due to the boundary constraints of the long narrow site and the location of wellheads and protected trees plus the setback requirements for the access way and river.

·      The access way, off Colombo Street, is zoned as legal road and would need to be stopped if the building were to be placed on or near it.

4.3       Renovation of the Council owned distribution centre (at 54a Colombo Street), (not recommended)

Advantages

·      The existing facility could be decommissioned once the new one was operational avoiding the need to establish a temporary facility – saving $211,000 facility costs.

Disadvantages.

·      The building is a single storey warehouse type structure with steel portal frames and precast concrete wall panels.  The construction drawings are dated July 1986 and it is assumed that construction was soon after this.  It has been assessed as > NBS 38%.

·      The distribution centre is significantly smaller than the current facility, with approximately 840m2 of floor area.  This corresponds to only 34% of the current facility floor area.

·      A comprehensive renovation including strengthening and fit out plus the installation of a lift would be required to make this building serviceable as a community facility.

·      The current use would need to be transferred to another site

·      It is anticipated that Community expectation would be that a similar level of service would be provided at the repaired/rebuilt facility.  This includes Library, Customer Service and Community Board spaces and services, plus a café, bookable meeting rooms and the creative learning and programming spaces.  Moving to a building with reduced floor space is unlikely to provide sufficient space for the current service offering.

·      Obtaining consent would take longer and cost more than remaining on the current site.  The subject site is zoned Residential Suburban in the Christchurch District Plan (the Plan) and is also a ‘Scheduled Activity’, Beckenham Water Services Yard and Pumping Station – Public Utilities (PU 1).  The scheduling would not allow for the redevelopment of the site for any other purposes.  Resource consent would likely be required to establish a library on the site as a Discretionary Activity and there is a risk that the application could be publicly notified.

4.4       A new site for the facility. (not recommended)

Advantage

·      The existing facility could be decommissioned once the new one was operational avoiding the need to establish a temporary facility – saving $211,000 facility costs.

 

Disadvantages

·      The existing facility is a busy community hub and well used by a number of community focused teams.  The site is centrally located in the ward and has good connectivity to public transport links as well as being an attractive setting in its own right.

·      Moving this facility to a new site would require extensive public consultation and may not be supported by the local community.

·      Establishing a new facility on a new site is expected to take considerably longer than rebuilding on the existing site and may cost more.  There is also a degree of uncertainty in relation to the availability of any suitable site in the area noting the zoning restrictions, the land to the east of the site and east of Waimea Terrace is located within a Character Area.

·      In the case that it is possible to find a suitable site, Council would still need to negotiate a sale, obtain resource consents and undertake extensive consultation with the users of the current facility and the wider public impacted by the new location.  This would take in the order of two years and cost more than consenting on the existing (scheduled – SC2– Service Centres and Community Centres) site.

·      In terms of opportunities to build on a new site in this area, a site-specific planning assessment would be required to understand what planning implications there may be.  It is noted that libraries are contained in the definition of ‘community facility’ in the District Plan. Community facilities are not provided for as permitted activities in the neighbouring Residential Zones and resource consent would likely be required to establish a library as a Discretionary Activity with the potential for the application to be publicly notified.

·      In addition to the increased cost of consenting the cost the land purchase for a new site could be an additional land cost for Council.  Although the cost of the new site could be offset by the sale of the current site, it is likely to be negatively impacted by the setback constraints, well heads on the site, contaminated land status, liquefaction potential of the site, High Flood Hazard Management Area, and adjacency to the public utility site next door which shares the access way.  Future use of the existing site would be limited to what can be consented under the District Plan which zones this as residential medium density.

·      Building a new facility on a new site in the area would require extensive public consultation which will increase the time and cost to achieve consent.

·      The opportunity to reuse the existing slab as the base for a new raft foundation would be lost with the associated cost and carbon impacts.

4.5       Defer the repair or rebuild of the facility (not recommended)

Advantages

·      Deferral would have the short term effect of saving on capital expenditure

 

Disadvantages.

·      Delaying the capital cost of construction will increase  risk, liability and cost escalations with the time taken to address this repair

·      South is the only library in the network of 20 libraries not to have been either repaired or rebuilt in the last decade, following the earthquakes of 2010/11.  Despite its high use, it is not at the same standard as other libraries of similar size and function with the building services at/or near end of life.

·      The building is currently at 34%NBS (IL3) and relies on temporary strengthening (the red steel bracing on the exterior) to achieve this.  The risk to the public in a 34%NBS (IL3) building is approximately 5-10x that of an equivalent new building designed to 100%NBS (IL3).  This temporary strengthening was installed in 2012 so has now been in place for almost 10 years. As a PCBU, Council needs to decide if they are comfortable continuing with this level of risk in what is a high-use community facility.

·      The durability of the building has been compromised due to the earthquake damage from a decade ago, with potential for increased maintenance costs and damage that may well exist currently but is unseen.

·      Opex costs will continue to rise as the compromised heating, cooling, ventilation and drainage systems continue to decline and approach the end of their useful working life.  There is a higher probability that asset subcomponents reactively fail and require replacement if the rebuild is further deferred.

·      There are operating issues with the HVAC system which mean it is no longer fit for purpose.  These issues are demonstrated by:

Ø Staff work areas have become health and safety discomfort issues caused by lack of cooling, inadequate heating control and limited ventilation effectiveness.

Ø Board room and learning centre rooms suffer from the same technical issues to the staff work areas

Ø Members of the public and staff regularly experience discomfort due to drafts, lack of cooling and inadequate heating control

Ø Café has inadequate odour and moisture exhaust ventilation, inadequate hot water supply and has restricted electrical capacity

 

In view of the new Covid mitigation focused ventilation assessments; all the occupants in this building are at a relatively high risk due to the lack of acceptable ventilation.

·      A major failure of any of these services or the building structure itself would run the risk of facility closure for a significant period.

·      The project was deferred in 2018 and again in 2020.  The 2015 LTP budget figure for this project was $16.55 million, this equates to $22.7 million (an additional 37%) in today’s dollars and $25.7 million (an additional 55%) by project completion in late 2025.  The estimated annual escalation cost for delaying the project beyond 2025 would be an average of 3-4% per annum compounding.  The cost of the construction work will continue to increase if the work is deferred.

·      The existing Café tenant needs some certainty over the timeline for this rebuild.  By deferring the work again we run the risk of losing this tenant.

 

4.6       Private-Public Partnership. (not recommended)

Advantages

·      A Private-Public Partnership would have the effect of saving on capital expenditure

 

 

 

Disadvantages.

·      Council is not currently aware of any opportunities of this nature or precedent for this model for a library-service centre hub.

·      Developing a relationship of this nature would likely add significantly to the complexity, timeframes and front end costs of the project.

·      It is possible the sort of deal that could be proposed here would be developer benefiting in being ‘gifted’ a long lease on the land and potentially build above.  It is anticipated that this arrangement could negatively impact community engagement and buy-in for the project.

·      Private-Public Partnerships have been suggested on other library projects and a mixed use development is just too complex when considering fire compliance, access, security, acoustics, etc.  Anything higher than single storey has a cost premium in the structure, stairs and lifts, increased circulation, etc...

·      Given that the focus of a community hub like the South Library and Service Centre is the local community, we consider that Council is best placed to deliver this service. 

·      In addition to the time needed to form a contractual relationship it is anticipated that there would be more time required for the predesign/briefing and design phases, as well as consultation with the Community about a significantly larger building on the site and any new activity on the site (e.g. commercial or residential use)

·      The constraints of the existing site including setbacks, well heads, contaminated land status, liquefaction potential, High Flood Hazard Management Area, adjacency to the public utility site next door which shares the access way.  Mean that future use of the existing site would be limited to what can be consented under the District Plan which zones this as residential medium density.

 

4.7       Consider a long term lease instead of rebuilding the South Library.  (not recommended)

Advantages

·    Leasing would have the short term effect of saving the current capital budget of $13.6 million which would have a 0.12% rates benefit spread over 4 years.

 

  Disadvantages.

·    The annual cost of commercial rent for an equivalent floor area (2462m2) is in the order of $700,000 per annum.  This is an operating cost that would directly impact rates, adding 0.11% to rates. 

·    It is doubtful that a long term lease of a suitable space in the desired location and of a suitable size to accommodate the various services and functions would be available or a cost effective option for Council.  It is anticipated that the community would not find this option acceptable for anything more than a short term solution.

·      A site-specific planning assessment would be required to understand what planning implications there may be.  Community facilities are not provided for as permitted activities in the neighbouring Residential Zones.  This means resource consent would likely be required to establish a library as a Discretionary Activity with the potential for a publicly notified application.

·      The placement of a community hub within a leased commercial space must be carefully considered as Council has no control over neighbouring activity which could potentially put staff and customers at risk.

5.   Detail Te Whakamahuki

5.1       The South Library and Service Centre is a busy popular community hub as demonstrated by the statistics below.  Programme attendance at South has grown over the last few years from 5th highest in FY 2018-2019 to 2nd in FY 2020-2021 with 12,002 attendees.

Issues

·   South Library issues (of physical books and other items) for the FY 2020-2021 were 511,443. More books were borrowed from South Library than any other library in the network.

·   South Library consistently accounts for 13% to 14% of all Issues.

·   The South Library collection has over 74,000 books available for loan which accounts for 6.6% of Libraries’ total stock holdings.

Visitation (Footcount)

·      South had the sixth highest footcount for FY 2020-2021 with 289,015 visits, which accounts for almost 8% of all visits across the network.

·      There has been a noticeable increase to the Issues per Visit metric each year at South Library , where the network average has remained fairly constant, possibly indicating its loyal customer base of avid readers

 

New members

·      In FY 2020-2021 1,422 new members were signed up, which was almost 7% of the total.

·      South consistently sits in the top 4 libraries for the number of new members signed-up.

 

5.2       Post-quake investigations were carried out in 2011 – 2013.  Temporary Repairs to strengthen the superstructure were carried out in 2012.  The original investigations carried out in the post-quake period necessarily focussed on life safety and building make safe work.  The investigations were high level, minimally invasive surveys designed to pick up critical data for temporary works.  This data was used to price and compare the original options for the repair scheme presented to Council in 2016.  This 2016 report provided estimate of scope and cost of repair noting that some elements were not fully investigated.  Key items not investigated included;

·   Insurance & legal

·   Geotech

·   Egress & Fire for code compliance

·   Flood levels

5.3       More than eight years have elapsed since the last of these primary investigations were carried out in 2013 and we now need to confirm the scope and cost of repair for this facility acknowledging that; what is acceptable today as a long-term solution may not be the do-minimum repair option chosen previously.

5.4       We have sought advice from the Legal Services Unit with respect to the utilisation of funds in the current LTP for, either a repair or rebuild.  In the case that additional funding is needed for the project, this can be covered off in the consultation process associated with either a future Annual Plan or LTP process.

5.5       Staff have investigated options for a temporary facility to house a small library and customer service offering.  The current cost estimate for the temporary facility (including moving, fit out, 2 years of rental net of current facility budgets and revenue losses) is $211,000.  An option following the closure of South Library Hours could be to extend the hours at Spreydon Library including evening and Sunday opening, plus the provision of the Mobile Library Service near the current South Library site on specific days and times, based on community demand.

5.6       It is not envisaged that further significant central government funding will be forthcoming and certainly not Capital funding to contribute to a major repair or rebuild.  Note, Council did receive operational funding from the Ministry of Education when South Library was opened for a few years to support targeted learning initiatives in partnership with the schools in the local area.  This funding did not contribute to the running costs or improvements to the facility itself.

5.7       The decision affects the Waihoro Spreydon-Cashmere Community Board area.

6.   Policy Framework Implications Ngā Hīraunga ā- Kaupapa here

Strategic Alignment Te Rautaki Tīaroaro

6.1       This report supports the Council's Long Term Plan (2021 - 2031):

6.1.1   Activity: Libraries

·     Level of Service: 3.1.2.1 Residents have access to a physical and digital library relevant to local community need or profile  - Provide weekly opening hours for existing libraries:23-74 hours per week (as appropriate for metropolitan, suburban, and neighbourhood)  .South is a large suburban library.

·     3.1.5 Library user satisfaction with library service at Metro, Suburban and Neighbourhood libraries

·     3.1.1.4 Collections and content in a variety of formats are available to meet the needs of the community.

·     3.1.3.1 residents have access to the internet…and new technologies.

·     3.1.3.3 Access to information via walk-in…..to library services.

·     3.1.4 Provide public programmes and events…learning and recreational needs.

·     3.1.8  Customer satisfaction with programmes and events.

Policy Consistency Te Whai Kaupapa here

6.2       The decision to rebuild the South Library is consistent with Council’s Plans and Policies.  The decision aligns with Council’s target of being net carbon neutral for its operations by 2030 and our commitments under the Council Ōtautahi Climate Resilience Strategy (issued 2021).

6.3       Once Council has resolved to provide direction on Council's preferred option for the remediation of the earthquake damaged South Library, the preferred option (repair / new build) will be procured in accordance with Council’s Procurement Policy and Framework.

Impact on Mana Whenua Ngā Whai Take Mana Whenua

6.4       The current proposal is to rebuild the existing facility on its current site.

6.5       Should the Council decide rebuild the library and service centre on its current site (recommended option), it is not anticipated that the scale or nature of operations at the site will change significantly.  The focus for rebuilding is to replace the damaged facility with associated improvements in strength, resilience, operational performance and functionality of the building.

6.6       There is an opportunity to engage with mana whenua early in the process to ensure that te reo name; Te Kete Wānanga o Wai Mōkihi is given prominence on the new building and that the cultural narrative of the site is incorporated into the design.

 

Climate Change Impact Considerations Ngā Whai Whakaaro mā te Āhuarangi

6.7       The whole-of-life carbon comparison shows the amount of carbon released at each building life cycle stage.  Climate change occurs as a result of accumulated greenhouse gases in the atmosphere reducing whole of life emissions is an important strategy for reducing climate impacts.  Rebuild has the lowest upfront emissions and total life cycle emissions, thus having a lower climate impact than the repair option.

6.8       A repair offers opportunity to re-life (re-use) existing fabric.  A rebuild offers greater scope to improve the environmental performance of the structure, envelope, servicing strategy, comfort and operational performance of the building.

6.9       In terms of net zero carbon targets:

·     Repair exceeds the 2020 benchmarks for embodied and operational targets however falls short of 2025 and 2030 targets.

·     Rebuild exceeds the 2025 target for embodies carbon and the 2030 target for operational carbon.

6.10    The total lifecycle carbon comparison is:

·   Repair 1,352 kgCO2e/m2

·   Rebuild 1,095 kgCO2e/m2.

Accessibility Considerations Ngā Whai Whakaaro mā te Hunga Hauā

6.11    We want to ensure our community facilities are accessible both to staff and visitors.

6.12    The current South Library and Service Centre is an accessible facility.  However in the course of the design process any changes in accessibility requirements for code compliance will be addressed.

6.13    Should the decision be made to build a new facility, staff investigations will include consideration of how the site and the facility as a whole are fully accessible.

7.   Resource Implications Ngā Hīraunga Rauemi

Capex/Opex / Ngā Utu Whakahaere

7.1       Cost to Implement - There is currently a CAPEX budget of $13.6 million on plan for the period FY22-26.  The cost estimate for the proposed repair and a cost estimate for an equivalent new build on the same footprint is repair $26.6 million (0.13% rates increase over three years from FY2024) vs. new build $24.9 million (0.11% rates increase over three years from FY2024).

7.2       No budget is currently allocated for R&R or facility upgrades because the facility is programmed for construction.  The condition of the facility is deteriorating and there are issues with HVAC and drainage.  This facility will require R&R funds if the EQ repair work is not proceeding as programmed.

7.3       The funding currently included in the capital programme for this project is insufficient for the repair (or rebuild).  The project will require additional funding through the 2023-2024 Annual Plan or 2024 Long Term Plan process to meet the shortfall.

7.4       We will also need to make an allowance for OPEX, phased to match construction, to cover the cost of a temporary facility.  This has been estimated at $211,000 for 24 months starting from an early 2024 start and is factored into the above noted rates impact.  The costs are net of current facility operating and maintenance budgets adjusted for loss of revenues from the café lease and inability to run programmes from the smaller facility for 24 months.

7.5       Both options increase Council’s debt ratio by approximately 0.09%.

Other / He mea anō

7.6       Once a decision has been made as to whether this facility should be repaired or rebuilt, the next phase of work can be advanced.  This comprises the development of a functional brief & technical specification which will enable an elemental costing to be completed.  This work will give Council more scope definition and enable a more accurate cost estimate to be developed.  It also provides a basis for the approach to market for design and construction tenders.

8.   Legal Implications Ngā Hīraunga ā-Ture

Statutory power to undertake proposals in the report / Te Manatū Whakahaere Kaupapa

8.1       The Council has the statutory power to either repair or rebuild the earthquake damaged South Library.

8.2       The Council has the legal ability to enter into contracts for the procurement of services, however to do so it needs to act in accordance with Section 14 of the Local Government Act 2002 (LGA) 2002.  The LGA 2002 (Section 14) details the principles relating to local authorities.  The principles most relevant to the Council's procurement activity are:

8.2.1   In performing its role, a local authority must act in accordance with the following principles:

a local authority should-

·    conduct its business in an open, transparent, and democratically accountable manner and;

·    give effect to its identified priorities and desired outcomes in an efficient and effective manner and;

·    undertake any commercial transactions in accordance with sound business practices and;

·    ensure prudent stewardship and the efficient and effective use of its resources in the interests of its district or region, including by planning effectively for the future management of its assets; and

·    in taking a sustainable development approach, a local authority should take into account-

the social, economic, and cultural interests of people and communities; and

the need to maintain and enhance the quality of the environment; and

Other Legal Implications / Ētahi atu Hīraunga-ā-Ture

8.3       The legal considerations are:

8.3.1   A rebuild provides more certainty of scope of work, and therefore more certainty of cost.  If a repair was selected as the preferred option, the condition of parts of the existing materials will not be able to be determined until works commence.  This may result in a more extensive scope of works than initially expected, and as a result, increased cost.

8.3.2   A rebuild will result in more comprehensive warranties and guarantees being available to the Council.  A repair using existing materials will potentially compromise certain warranty claims if the failure could be attributed to the quality of the existing materials.  An appropriate contract can mitigate a portion of this risk, however the risk is eliminated entirely if a rebuild is selected.

8.4       This report has been reviewed and approved by the Legal Services Unit.

9.   Risk Management Implications Ngā Hīraunga Tūraru

9.1       The complex and extensive repair needed to return the South Library to 100% New Building Standard involves a significant degree of uncertainty and therefore risk.  A new build is more easily defined and the associated construction work is fully warrantied so is a lower risk than repair.

9.2       The Council needs to consider a number of risks when considering this report.  Of particular note are: financial, legal and reputational.

Financial risks include:

·      Ongoing operational costs of maintaining facility with the current building services systems issues;

·      Difficulty in fully scoping repair work results in a complex repair contract with an increased risk of scope variation, programme delay and associated cost increases

·      Increases in the cost of repair / new build with inflation; and

·      Vulnerability of IL3 at 34% NBS puts it at risk of closure in a future seismic or flood event

·      Future insurance issues if the building is repaired rather than replaced and the risk that significant reinstatement costs may not be covered by insurance

Legal risks include:

·      Difficulty in fully scoping repair work results in a complex repair contract with an increased risk of scope variation, programme delay, warranty and compliance issues

·      Vulnerability of IL3 at 34% NBS puts it at risk of closure in a future seismic or flood event

Reputational risks include:

·      Vulnerability of IL3 at 34% NBS puts it at risk of closure in a future seismic or flood event

·      Concern from staff and community about delay in repair and length of closure; and

·      Concern from the wider Christchurch community regarding costs of repairing or building a new facility.

·      Consistency of choice with regard to Council’s Climate Resilience strategy (repair does not meet targets)

 

Attachments / Ngā Tāpirihanga

No.

Title

Page

a

South Library EQ Repair_Geotech Report_Aurecon 01 December 2021

127

b

South Library EQ Repair_Geotech PSI Report_Aurecon 02 December 2021

143

c

South Library EQ Repair_Structural Engineering Report_Lewis Bradford 08 December 2021

201

d

South Library EQ Repair_Architectural Report_Jasmax 21 January 2022

215

e

Christchurch South Library Carbon Report_Jasmax_
220317

228

f

South Christchurch Library Repair & Rescoping Cost Report R2

264

 

 

In addition to the attached documents, the following background information is available:

Document Name

Location / File Link

Nil

Nil

 

 

 

 

 

 

Confirmation of Statutory Compliance / Te Whakatūturutanga ā-Ture

Compliance with Statutory Decision-making Requirements (ss 76 - 81 Local Government Act 2002).

(a) This report contains:

(i)  sufficient information about all reasonably practicable options identified and assessed in terms of their advantages and disadvantages; and

(ii) adequate consideration of the views and preferences of affected and interested persons bearing in mind any proposed or previous community engagement.

(b) The information reflects the level of significance of the matters covered by the report, as determined in accordance with the Council's significance and engagement policy.

 

 

 

Signatories / Ngā Kaiwaitohu

Authors

Lynne Armitage - Project Manager

Adrian Seagar - Insurance & Asset Manager

Elizabeth Neazor - Manager Legal Service Delivery, Commercial & Property

Approved By

Brent Smith - Acting Head of Vertical Capital Delivery

Carolyn Robertson - Head of Libraries and Information

Peter Langbein - Finance Business Partner

Mary Richardson - General Manager Citizens & Community

  


Finance and Performance Committee

26 May 2022

 

















Finance and Performance Committee

26 May 2022

 



























































Finance and Performance Committee

26 May 2022

 















Finance and Performance Committee

26 May 2022

 














Finance and Performance Committee

26 May 2022

 





































Finance and Performance Committee

26 May 2022

 








Finance and Performance Committee

26 May 2022

 

 

13.   Local Government Funding Agency - Quarter 3, 2021/22 Performance Report

Reference / Te Tohutoro:

22/573842

Report of / Te Pou Matua:

Linda Gibb, Performance Advisor, Resources Group (linda.gibb@ccc.govt.nz).

General Manager / Pouwhakarae:

Leah Scales, General Manager, Resources Group (leah.scales@ccc.govt.nz).

 

 

1.   Brief Summary

1.1       The purpose of this report is to present the Local Government Funding Agency’s (LGFA’s)  Quarter 3 2021/22 Performance Report which is at Attachment A.

1.2       The report has been written as a result of receiving LGFA’s performance report on 28 April 2022 in accordance with section 66 of the Local Government Act 2002 (if requested by a local authority, a Council-controlled organisation is to report on its operations to its shareholders within two months after the end of the first and third quarters of each financial year).

1.3       The LGFA is owned by the New Zealand Government (11.1%)[1] and 30 councils hold the remainder.   

2.   Officer Recommendations Ngā Tūtohu

That the Finance and Performance Committee:

1.         Receives the Local Government Funding Agency’s Quarter 3 2021/22 Performance Report.

Quarter 3 2021/22 outturn

2.1       The LGFA’s financial performance targets and year to date outturn to 31 March 2022 is as follows:

Target

Actual

$m

Target

$m

Last year

$m

Total operating income

14.4

14.8

15.9

Issuance, on-lending and operating expenses

(5.0)

(5.3)

(4.8)

Approved Issuer Levy

(0.33)

N/A

(0.59)

Net Profit

9.05

N/A

10.5

 

2.2       The LGFA’s performance is largely in line with its SOI targets, with all variances less than 5%. 

2.3       Its performance against the same period in 2020/21 shows a material negative variance in income – a reduction of $1.5 million (14%).  This is due to a sharp increase in interest rates in the quarter coupled with a reduction of 5 basis points on lending to Councils from 1 July 2021 (this reduction was made based on the LGFA’s  forecast operating costs being lower than previously expected). 

2.4       The following table shows the change in LGFA lending, and total assets:

Target

Actual

$m

Target

$m

Last year

$m

Total lending to participating councils

13,825

13,800

12,350

Total bonds and bills issued

15,798

N/A

13,910

2.5       Lending of $13.8 billion is in line with its SOI target and approximately $1.5 billion (+11.9%) higher than for the same period in 2020/21.  This reflects councils’ on-going funding requirements for capital investment. 

2.6       Borrowing of $15.8 billion is approximately $1.9 billion (+14%) higher than the same period in 2020/21.  Borrowing is incurred to fund LGFA’s lending and to maintain a portfolio of investment assets (currently $2.6 billion) to comply with liquidity and capital adequacy regulations. Interim targets for borrowing are not provided.  Borrowing levels broadly match movements in lending.   

2.7       LGFA advises that there have been no breaches of its Treasury Policy or any regulatory or legislative requirements including health and safety.

2.8       As reported previously, the two non-financial targets that LGFA advises it is not on target to meet by year end are “to have an 85% market share of all council borrowing in New Zealand” and “to review each participating local authority’s financial position, headroom under LGFA policies and arrange to meet each at least annually”.  The market share of all council borrowing cannot be met while Auckland Council continues to hold a large amount of private debt.  The LGFA  has not been able to meet each participating local authority due to COVID-19 travel difficulties. 

 

 

Attachments / Ngā Tāpirihanga

No.

Title

Page

a

Local Government Funding Agency - Quarter 3 2021/22 Performance Report.

274

 

 

In addition to the attached documents, the following background information is available:

Document Name

Location / File Link

Nil

Nil

 

 

 

Confirmation of Statutory Compliance / Te Whakatūturutanga ā-Ture

Compliance with Statutory Decision-making Requirements (ss 76 - 81 Local Government Act 2002).

(a) This report contains:

(i)  sufficient information about all reasonably practicable options identified and assessed in terms of their advantages and disadvantages; and

(ii) adequate consideration of the views and preferences of affected and interested persons bearing in mind any proposed or previous community engagement.

(b) The information reflects the level of significance of the matters covered by the report, as determined in accordance with the Council's significance and engagement policy.

 

 

 

Signatories / Ngā Kaiwaitohu

Author

Linda Gibb - Performance Monitoring Advisor CCO

Approved By

Bruce Moher - Acting Head of Finance

Leah Scales - General Manager Resources/Chief Financial Officer

  


Finance and Performance Committee

26 May 2022

 

















Finance and Performance Committee

26 May 2022

 

 

14.   Christchurch Foundation - Budget 2022/23

Reference Te Tohutoro:

21/1785138

Report of Te Pou Matua:

Linda Gibb, Performance Advisor, Resources Group (linda.gibb@ccc.govt.nz).

General Manager Pouwhakarae:

Leah Scales, General Manager/CFO, Resources Group (leah.scales@ccc.govt.nz).

 

 

1.   Purpose of the Report Te Pūtake Pūrongo

1.1       The purpose of this report is to seek the Finance and Performance Committee’s approval of the Christchurch Foundation’s funding request for 2022/23 of $200,000 which is consistent with the provision made in the Council’s Long Term Plan 2021-31.  The funding request is the final call on the Council under the Support Agreement with the Foundation, and signals the end of the Foundation’s establishment phase.

1.2       The Foundation’s budget, at Attachment A projects total expenditure of $704,438 and revenue of $710,000 for 2022/23 (including the $200,000 sought from the Council).  It is lower than provided for in the Support Agreement between the Council and the Foundation by $400,000.  The balance of revenue of $510,000 required to meet the projected expenditure has been sourced from third parties, including from new programmes (such as the Better City Business) and growing its fee-for-service programme and pro-bono partnerships.

1.3       The Foundation has expressed a strong desire to be self-funding and has made significant progress towards this over the past two years.  In the event it requires funding support from the Council in future, these would need to be considered by the Council in a future annual or long term plan.  

1.4       This report has been written following the receipt of the Foundation’s 2022/23 budget on 16 May 2022.  The decisions in this report is of low significance in relation to the Christchurch City Council’s Significance and Engagement Policy.  The level of significance was determined by considering the impact the decision would have on the community.

 

2.   Officer Recommendations Ngā Tūtohu

That the Finance and Performance Committee:

1.         Approves funding support to the Christchurch Foundation for 2022/23 of $200,000; and

2.         Notes the funding allocation in 2022/23 is the Christchurch Foundation’s final call under the Support Agreement dated 19 December 2018.

 

3.   Reason for Report Recommendations Ngā Take mō te Whakatau

3.1       The Council is required to provide funding support to the Foundation under the Support Agreement between the two parties.  The Foundation’s budget for 2022/23 supports the funding request of $200,000.

 

4.   Alternative Options Considered Ētahi atu Kōwhiringa

4.1       Other options have not been considered since the Council has a legal obligation to provide funding support.

5.   Policy Framework Implications Ngā Hīraunga ā- Kaupapa here

Strategic Alignment Te Rautaki Tīaroaro

5.1       This report is consistent with the financial provisions of the Council's Long Term Plan (2021 - 2031).

Policy Consistency / Te Whai Kaupapa here

5.2       The decision is consistent with the Council’s Plans and Policies, reflecting the Council’s commitment to meet its legal obligations.

Impact on Mana Whenua Ngā Whai Take Mana Whenua

5.3       The decision does not involve a significant decision in relation to ancestral land or a body of water or other elements of intrinsic value, therefore this decision does not specifically impact Mana Whenua, their culture and traditions.

Climate Change Impact Considerations Ngā Whai Whakaaro mā te Āhuarangi

5.4       Not relevant.

Accessibility Considerations Ngā Whai Whakaaro mā te Hunga Hauā

5.5       Not relevant.

6.   Resource Implications Ngā Hīraunga Rauemi

Capex/Opex Ngā Utu Whakahaere

6.1       Cost to Implement - $200,000.

6.2       Maintenance/Ongoing costs – nil.

6.3       Funding Source – Long Term Plan 2021-31.

7.   Legal Implications Ngā Hīraunga ā-Ture

Statutory power to undertake proposals in the report Te Manatū Whakahaere Kaupapa

7.1       Local Government Act 2002.

Other Legal Implications Ētahi atu Hīraunga-ā-Ture

7.2       The Council has a legal obligation to provide funding of up to $600,000 per annum to the Foundation, ending in 2022/23.  This obligation is set out in the Support Agreement between the Council and the Foundation, dated 19 December 2018.

8.   Risk Management Implications Ngā Hīraunga Tūraru

8.1       Not relevant.

 

 

Attachments Ngā Tāpirihanga

No.

Title

Page

a

Christchurch Foundation - Budget 2022/23

294

 

 

Additional background information may be noted in the below table:

Document Name

Location / File Link

Nil

Nil

 

 

 

Confirmation of Statutory Compliance Te Whakatūturutanga ā-Ture

Compliance with Statutory Decision-making Requirements (ss 76 - 81 Local Government Act 2002).

(a) This report contains:

(i)  sufficient information about all reasonably practicable options identified and assessed in terms of their advantages and disadvantages; and

(ii) adequate consideration of the views and preferences of affected and interested persons bearing in mind any proposed or previous community engagement.

(b) The information reflects the level of significance of the matters covered by the report, as determined in accordance with the Council's significance and engagement policy.

 

 

 

Signatories Ngā Kaiwaitohu

Author

Linda Gibb - Performance Monitoring Advisor CCO

Approved By

Leah Scales - General Manager Resources/Chief Financial Officer

  


Finance and Performance Committee

26 May 2022

 








 


Finance and Performance Committee

26 May 2022

 

 

15.   Resolution to Exclude the Public

Section 48, Local Government Official Information and Meetings Act 1987.

 

I move that the public be excluded from the following parts of the proceedings of this meeting, namely items listed overleaf.

 

Reason for passing this resolution: good reason to withhold exists under section 7.

Specific grounds under section 48(1) for the passing of this resolution: Section 48(1)(a)

 

Note

 

Section 48(4) of the Local Government Official Information and Meetings Act 1987 provides as follows:

 

“(4)     Every resolution to exclude the public shall be put at a time when the meeting is open to the public, and the text of that resolution (or copies thereof):

 

             (a)       Shall be available to any member of the public who is present; and

             (b)       Shall form part of the minutes of the local authority.”

 

This resolution is made in reliance on Section 48(1)(a) of the Local Government Official Information and Meetings Act 1987 and the particular interest or interests protected by Section 6 or Section 7 of that Act which would be prejudiced by the holding of the whole or relevant part of the proceedings of the meeting in public are as follows:


Finance and Performance Committee

26 May 2022

 

 

 

ITEM NO.

GENERAL SUBJECT OF EACH MATTER TO BE CONSIDERED

SECTION

SUBCLAUSE AND REASON UNDER THE ACT

PLAIN ENGLISH REASON

WHEN REPORTS CAN BE RELEASED

16.

Public Excluded Finance and Performance Committee Minutes - 28 April 2022

 

 

Refer to the previous public excluded reason in the agendas for these meetings.

 

17.

Insurance Renewal Update

s7(2)(b)(ii)

Prejudice Commercial Position

Insurance renewals are undertaken on a confidential basis due to the commercial sensitivities involved.

31 July 2023

This report may be released after the end of the 2022 / 2023 cover year. Policy details around terms, conditions and pricing must remain confidential.

 

 



[1] The Government’s shareholding of 11.1% is based on its share of total capital including both paid and uncalled capital.  The Government is the only shareholder exposed to calls for capital.  Excluding the uncalled capital, the Government’s shareholding is 20% and local authorities hold the remainder.