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Council - Long Term Plan 2024 - 2034
14 February 2024
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3. Draft Long-Term Plan 2024-2034
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Reference / Te Tohutoro:
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23/2098528
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Report of / Te Pou Matua:
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Peter
Ryan, Head of Corporate Planning & Performance (peter.ryan@ccc.govt.nz)
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Senior Manager / Pouwhakarae:
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Lynn
McClelland, Assistant Chief Executive Strategic Policy and Performance
(lynn.mcclelland@ccc.govt.nz)
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1. Purpose and Origin of Report Te Pūtake Pūrongo
1.1 To
present to the Council for consideration and adoption the information that provides
the basis for preparation of the Council’s draft Long-Term Plan 2024-34,
Consultation Document, and the consultation and engagement process to be
undertaken by Council.
1.2 The
Local Government Act (LGA 2002) requires local authorities to adopt a Long-Term
Plan every three years. The Council’s current Long-Term Plan was adopted
in June 2021.
2. Officer Recommendations Ngā
Tūtohu
That
the Council - Long Term Plan 2024 - 2034:
1. Receives the information contained and
referred to in the draft Long-Term Plan 2024-2034 report and the attached
documents, including the draft Consultation Document, Financial Strategy and
Infrastructure Strategy.
2. Notes the recommendations of the
Council’s Audit and Risk Management Committee at its meeting on 8
February 2024 as detailed in Attachment E.
3. Provisionally approves and adopts for
consultation the information contained or referred to in the draft Long-Term
Plan 2024-2034 report which provides the basis for the draft Long-Term Plan
2024-34, together with any amendments made by resolution at the meeting,
and subject to the following:
a. the passing of the Water Services Acts Repeal Bill and
its commencement (to achieve compliance with the Local Government Act 2002);
and
b. the inclusion of the Auditor-General’s report
required by s.93C(4) of the Local Government Act (LGA) 2002, which will be
supplied to the Council meeting on 11 March 2024, at which point formal
adoption of the information that provides the basis for the Council’s
draft Long-Term Plan, Consultation Document and audit report can occur.
4. Provisionally approves and adopts the
supporting technical documents, including draft Activity Plans and Asset
Management Plans (as detailed below) subject to the following:
a. the passing of the Water Services Acts Repeal Bill and
its commencement (to achieve compliance with the Local Government Act 2002);
and
b. the inclusion of the Auditor-General’s report
required by s.93C(4) of the Local Government Act (LGA) 2002, which will be
supplied to the Council meeting on 11 March 2024, at which point formal
adoption of the information of the information that provides the basis for the
Council’s draft Long-Term Plan, Consultation Document and audit report
can occur.
c. Draft Activity Plans and Draft Asset Management Plans
d. Draft Long-term Plan 2024- 34 documents
e. Financial Overview
f. Funding Impact Statement, including Rating Information
g. Financial Prudence Benchmarks
h. Community Outcomes and Strategic Framework
i. Summary of Grants
j. Proposed Activities and Services - Statements of Service
Provision
k. Proposed Capital Programme
l. Proposed Fees and Charges
m. Potential Disposal of Council-owned properties
n. Prospective Financial Statements
o. Significance and Engagement Policy (unchanged from 2019)
p. Revenue, Financing and Rating Policy
q. Liability Management Policy and Investment Policy
r. Council-controlled Organisations
s. Reserves and Trust Funds
t. Capital Endowment Fund
5. Provisionally approves and adopts for
consultation, the Consultation Document (Attachment A), subject to
decisions made at this meeting and subject to the following:
a. the passing of the Water Services Acts Repeal Bill and
its commencement (to achieve compliance with the Local Government Act 2002);
and
b. the inclusion of the Auditor-General’s report
required by s.93C(4) of the Local Government Act (LGA) 2002, which will be
supplied to the Council meeting on 11 March 2024, at which point formal
adoption of the information that provides the basis for the Council’s
draft Long-Term Plan, Consultation Document and audit report can occur.
6. Authorises the Interim Chief Executive to make
any non-material changes to the documents and/or information attached to or
referred to in the draft Long-Term Plan 2024-2034 report, as well as amendments
that may be required to ensure the documents and/or information align with the
Auditor-General’s report as a result of the Water Services Acts Repeal
Bill.
7. Notes that the list of properties in Attachment
D will be consulted upon to seek community views and preferences as to
their future use. This will help inform the decision to be made, when adopting
the final Long-Term Plan, of retaining them for an alternative public work or
declaring them surplus for disposal.
8. Approves the following process for
consultation for the draft Long-Term Plan 2024-2034:
a. Consultation Document available on the Council’s
website on 13 March 2024;
b. Hard copies of the draft Long-Term Plan
2024-2034 will be available from Te Hononga Civic Offices on 13 March 2024, and
available from the Council’s libraries and service centres from the week
commencing 18 March 2024.
c. Public Notices in The Star, The Press, and on the
Council’s website signalling the start of consultation;
d. The period for making submissions will run from 9am on 13
March 2024 to midnight on 17 April 2024;
e. For people who indicate they wish to present oral
submissions, hearings will be held from late April through May 2024 (exact
dates will be confirmed and communicated to those submitters closer to the
time). The following time allocations will apply:
i. Community Boards, Ngā Papatipu
Rūnanga and other councils – 10 minutes
ii. Groups and organisations – 5 minutes
iii. Individuals – 5 minutes
f. Notes that all submissions will then be considered before
the Council meets in late June 2024 to adopt its Long-Term Plan 2024-34.
3. Reason for Report Recommendations Ngā Take mō te
Whakatau
3.1 The
Local Government Act (LGA 2002) requires local authorities to adopt a Long-Term
Plan every three years. The Council’s current Long-Term Plan (LTP)
(10-year) was adopted in June 2021.
3.2 Each
LTP must be adopted before the commencement of the first year to which it
relates, and continue until the close of the third year of the Plan (s 93(3)
LGA 2002).
3.3 The
purpose of the LTP is to describe the Council’s activities and the
community outcomes for its district. The Plan is also an opportunity to provide
integrated decision-making and co-ordination of the Council’s resources,
and a long-term focus for its activities. It is a basis for accountability to
the community (s93(6) LGA 2002).
3.4 The
Council must prepare and adopt a Consultation Document (CD) that will enable
the Council to consult with its community on the information the Council
intends to include in its 2024-34 Long-Term Plan.
3.5 The
purpose of the Consultation Document is to provide a fair representation of the
matters that are proposed for inclusion in the LTP. This must be presented in a
way that explains the overall objective of the Council’s proposals for
the next 10 years, the effect of these on rates, debt, and levels of service,
and that can be readily understood (s 93B LGA 2002).
3.6 Before
the Council can adopt the Consultation Document, it must first adopt the
information that is relied on by the Consultation Document, and which provides
the basis for the preparation of the 2024-34 Long-term Plan (s 93G LGA 2002).
3.7 The
Auditor-General (through Audit NZ) will report on the quality of this
information and the assumptions underlying it, and whether the Consultation
Document gives effect to the purpose set out in s 93B LGA 2002.
3.8 The
information to be adopted by the Council before it adopts the Consultation
Document is set out in Attachment A. Also attached is the Financial
Strategy (Attachment B) and Infrastructure Strategy (Attachment C),
all of which are key to the Council’s proposed approach to meeting the
challenges of the next ten years.
3.9 It
is the role of the Mayor to lead the development of the Council’s plans,
including the LTP (s 41A(2) LGA 2002). This included setting the overall
parameters, strategic direction and priorities for the LTP, and the development
of a Consultation Document.
3.10 The
Council’s Audit and Risk Management Committee (ARMC) met on 8 February
2024. Its Terms of Reference include considering and reviewing the LTP before
it is adopted by the Council. It is to apply similar levels of enquiry,
consideration, review and management sign-off as are required for external
financial reporting.
4. Process
4.1 The
draft Long-Term Plan 2024-2034 has been developed over the last 18 months by
staff as well as through extensive guidance from the Mayor and Councillors.
This included guidance on the overall direction and parameters to apply to the
development of the draft LTP, including expectations for balancing Government
reforms, ongoing impacts of long-term challenges faced by our community such as
climate change, rising cost of living and affordability issues, as well as
confronting the challenge of rising inflation, interest and insurances costs
with skills shortages and supply chain disruptions impacting on our operations
and capital projects.
4.2 Staff
worked extensively with the Mayor and Councillors on a set of strategic
priorities to inform the draft, including specific goals and initiatives and
linkages to levels of service.
4.3 The
LTP process was guided by the Mayor and Councillors’ Letter of
Expectation (the Letter), which sought specific improvements over certain
aspects of the 2021 process. The new LTP process, based on the Letter, was
approved by the LTP project team, Executive Leadership Team, the Finance and
Performance Committee and the Council. It was also considered by ARMC.
4.4 The
LTP project team was chaired by the Assistant Chief Executive as Project
Sponsor. Work stream leads were appointed to be accountable for the delivery of
each component of the LTP.
4.5 In
keeping with the Letter, the Council played an active role in reviewing the
information that provides the basis for preparation of the draft LTP. The
Council met regularly from July 2023 to January 2024 to review the key
documentation and provide guidance to staff. The key guidance was around levels
of service (which was used as the basis of activity budgets) and the capital
programme.
4.6 Regular
updates have been provided to the Finance and Performance Committee and the
ARMC on both the process and draft content of the developing LTP.
4.7 As
the draft LTP evolved, Council staff held an extensive series of joint
development briefings with the Mayor and Councillors (many of which were
publicly accessible) to obtain overall direction and to fine-tune specific
details. This commenced in July 2023 and concluded in January 2024. Key
joint development briefing dates were advertised so the public could attend
(public meetings and live-streaming), and all briefing recordings, content and
briefing notes were released through Long Term Plan
2024-2034 | What matters most? | Kōrero mai | Let’s talk
(ccc.govt.nz)
4.8 This
provided opportunities for Councillors to discuss and provide direction on
their priorities for the draft LTP 2024 and their expectations for matters such
as rates increases, level of debt, financial headroom, the capital works
programme, levels of service and savings options.
4.9 The
joint development process also contained a series of briefings on the potential
for a more flexible mandate for Christchurch City Holdings which would enable
different ownership and funding models and the ability to increase returns to
Council over time. In December 2023 the Council resolved to adopt an enhanced
‘status quo’ option.
4.10 The
draft LTP is focused on a deliverable and affordable capital programme.
Past performance was used to rigorously support future expectations so that we
only undertake to do what we can realistically deliver. We also made
assessments to maximise third party funding (such as New Zealand Transport
Agency, Waka Kotahi subsidies and other Government grants and funding
opportunities) to build and renew essential infrastructure while limiting the
financial impact on the ratepayer.
4.11 The
programme strongly supports the Letter of Expectations and Infrastructure
Strategy through strong investment in renewals and replacement of existing
assets – taking great care of, and looking after, what we have already
got.
4.12 It
also provides what is considered a reasonable and balanced investment approach
across the wide range of infrastructure categories that the Council owns and is
responsible for. It allows for improved levels of service where called
for and responds to the City’s growth patterns, the latter with support
from Development Contributions.
4.13 Guidance
was received from the Council early in the joint development process that
levels of service were to be maintained in the draft LTP. This was in part
informed by the LTP pre-engagement process What Matters Most, which showed a
clear community preference to preserve/protect the services and infrastructure
currently provided by the Council.
4.14 There
has been a focus on risk management throughout the LTP process. This is
supported by a suite of four risk tools – enterprise risks, operational
risks, and risks embedded in detailed management and significant assumptions
signoffs by senior staff.
4.15 The
draft LTP recommends (in the opinion of senior management, and based on the
advice provided by Councillors) the best balance between financial, risk and
service delivery to the community.
4.16 Note
that other options for the LTP (including options around greater and lesser
spending/rates percentages) were carefully analysed by senior management and
councillors, but were considered to have fewer advantages than the
Council’s recommended option.
4.17 This
is because of the greatly increased risk that goes with higher rates
increases/spending (for example, risks around debt, headroom and capital
programme delivery) and equally the loss of opportunity that goes with lower
rating/spending (impacts on critical asset renewal programmes, loss of capital
works, and reduction in core levels of service.
4.18 This
focus on an optimal balance has been considered in detail by the LTP project
team, Legal Services, the Executive Leadership Team, Council, Audit NZ and the
ARMC.
4.19 The
focus of the Consultation Document is on the optimal balance described above,
but the draft also includes a small number of specific options for the
community to consider.
4.20 All
parties consulted have advised that they accept the logic of this process and
approach. Subject to passing of the Water Services Acts Repeal Bill and its
commencement (in relation to Part 6 of Schedule 1AA of the Local Government Act
2002), legal advice confirms that it otherwise complies with the relevant
provisions of the Local Government Act 2002.
5. Financial Overview
5.1 The
Council faces multiple financial challenges including significantly increased
debt servicing costs, significantly increased insurance costs, challenging
asset renewal requirements, the costs of climate change adaption and
mitigation, and the general increase in costs that a high rate of inflation
brings.
5.2 Another
challenge in the mix is the final phase of the rebuild following the
earthquakes of 2010/11 with additional costs associated with the construction
and then operation of key facilities such as Te Kaha (the multi-use indoor
arena), Parakiore (our flagship sports and aquatic centre) and Te Whare Tapere
(the performing arts precinct).
5.3 The
Financial Strategy seeks to reconcile the relationship between the expenditure
required to deliver the levels of service the community expects, and the call
on funding from rates and debt.
5.4 These
factors are inter-related and movement in one causes movement in at least one
of the other variables. For example, if rates are reduced then some combination
of reduced or delayed expenditure is required, which in turn will likely result
in a reduced level of service being delivered, or increased debt.
5.5 The
draft Financial Strategy and Infrastructure Strategy present the
Council’s proposed solution to these challenges and detail the key
financial parameters and limits the Council will operate within over the period
of the Long-Term Plan 2024-34.
5.6 With
some limitation on borrowing capacity prior to 2028 and also taking into
account deliverability and affordability, the Council has restrained its
proposed core capital programme in the first three years. The asset renewals
programme has planned capital expenditure of $297-$359 million per year in the
first three years and an average annual spend of $344 million for the 10-year
period. A total capital programme of $6.25 billion over the LTP period is
proposed. The core capital programme is averaged at $596 million per annum over
the 10-year period (excluding Te Kaha).
5.7 To
minimise the impact on rates, revenue increases and operational savings of $41
million are proposed over the ten year life of the LTP, in addition to cost
saving initiatives implemented in the 2023/24 Annual Plan.
5.8 An
average rates increase to all existing ratepayers of 15.84% is proposed for
2024/25. This enables a capital investment programme to be delivered
progressing the major facilities and prioritised infrastructure renewals, while
also accommodating repayment of debt. A further rates increase of 8.20%
is forecast in 2025/26, before dropping to around 4% and declining in each
subsequent year to the end of the LTP. A total cumulative rates increase over
the LTP period of 53.6% is forecast.
5.9 The
Council’s net debt to revenue ratio increases materially in the 2025
– 2028 period, due to increased term debt borrowings. The ratio reaches a
peak in 2028 of 186.7% before starting to decline. After 2028, the net debt to
revenue ratio is budgeted to gradually improve and there will be ability to
borrow at least $1.2 billion without breaching debt covenants by 2034. Staff
believe current and forecast debt can be serviced comfortably.
5.10 A
key feature of the financial strategy is to ensure the ability to access
funding through borrowing if the unexpected happens. Minimum debt headroom of
$600 million has been maintained in all years of the LTP.
5.11 The
Council has a statutory obligation to ensure prudent stewardship and the
efficient and effective use of its resources, with financial prudence being
measured by a number of benchmarks.
5.12 The
proposed LTP meets all financial prudence benchmarks across all years except
for the debt servicing benchmark but there are no concerns around the ability
to service the debt. The balanced budget benchmark is met in each year of the
LTP.
5.13 The
proposed LTP does not provide for inflation protecting the principal of the
Capital Endowment Fund. Relatively low investment returns mean it is not
feasible to do so while still providing funding for economic and community
development.
Rates
5.14 The
draft LTP includes a rates requirement (excl gst) to be levied of $795 million
in 2024/25.
5.15 The
proposed average rates increase to all existing ratepayers is 15.84% in
2024/25.
5.16 The
increases for the average property based on capital value in the three sectors
is:
· Residential 14.9%
· Business 17.0%
· Remote Rural 17.8%
5.17 The
average house will have a rates increase of $9.65 per week. Full details of
rates, including the total rating requirement for general and targeted rates,
and indicative rates for sample properties, are provided in the Funding Impact
Statement.
Operational Expenditure
5.18 Operational
expenditure of $7.4 billion is proposed over the 10 years of the LTP,
increasing each year from $660 million in 2024/25 to $815 million in 2033/34.
5.18.1 During
the next three years an ambitious community facility investment programme will
be completed. Community facilities to be completed by 2025/26 include:
· Matatiki: Hornby Centre-
opening in 2024
· Te Whare Tapere –
Performing Arts Precinct – opening in 2025
· Parakiore – multi
sports and aquatic centre (funded by the government) – scheduled to open
in 2025
· Te Kaha – multi use
arena (co-funded by the government) – opening in 2026.
5.18.2 Once
these facilities open, operating costs will increase by around $141 million
over the life of the LTP. The LTP 2024-34 includes a more comprehensive suite
of initiatives to address climate change mitigation and adaption than previous
LTPs. Climate change will increasingly impact on the Council’s
expenditures in a variety of ways, including:
· Increased maintenance and
operational costs as infrastructure assets are compromised by the effects of
climate change such as sea level rise, water table rise and the impact of
extreme weather events.
· Costs associated with
responding to natural hazards, weather events and climate change, as government
policy evolves.
· Costs to offset the
Council’s residual emissions in 2030 when our net zero carbon target
comes into effect.
· Increased insurance costs
and/or insurance retreat.
· Emissions reduction and
adaption may affect the Council’s cost of borrowing. Lenders’
rates in the future may be linked to meaningful and measurable sustainability
outcomes.
· Proactive investment in
climate change mitigation and adaption will help lower costs and risks over the
long term.
5.18.3 Operational
revenues and expenditure savings are budgeted to be achieved without lowering
external levels of service. $41 million of increased revenues and operational
savings were accepted across the full period of the LTP as the maximum change
that could be made without impacting levels of service.
Surplus, operating deficits, and
sustainability
5.19 The
draft LTP shows accounting surpluses of $986 million before revaluations over
the ten years of the Plan. Under accounting standards the Council is required
to show all revenue, including recoveries from central Government and NZ
Transport Agency, as income for the year. However, some of these recoveries
reimburse the Council for capital expenditure. After adjusting for these
capital revenues, the Council is forecasting a balanced budget for each year of
the Plan.
Capital programme expenditure
5.20 This
was the subject of strong direction in the Mayor and Council’s Letter of
Expectation - to ensure a deliverable capital programme across the life of the
LTP. The LTP 2021 provisions, amended by the FY23 Annual Plan, provided for a
total $6.31 billion of capital expenditure across the 10-year period. This has
been restricted to a total capital programme of $6.25 billion with reductions
in Years 1 and 2 of $35 million and $27 million respectively. This slight
reduction in real terms demonstrates considerable restraint against rising
costs and inflationary pressure that have been prevalent and remain problematic
at this point.
5.21 The
Core Infrastructure component (which excludes Te Kaha) has been re-phased to a
realistic $563 million in Year 1, which we believe manages staff and market
capacity and inflationary pressures.
5.22 Key
factors taken into account when considering deliverability were:
· Historic performance on
delivery
· Cost
escalation/inflationary pressure
· Supply chain issues
– including resources, materials and labour
· External Funding sources
(including Waka Kotahi subsidies from Central Government) have been optimised
to minimise costs to the Christchurch ratepayers while ensuring we can still
deliver on those funding commitments. It is noted that with the new Government
in place and the pending release of the Government Policy Statement on Land
Transport that these funding mechanisms are subject to change.
5.23 The
proposed programme of Core Infrastructure maintains a good balance between
prudent financial management and responsible stewardship of the Council’s
assets and is considered a deliverable programme.
5.24 Key changes and re-phasing compared to the current LTP provisions
are scheduled in supporting documents and these are summarised as:
Community Facilities and Parks
· Significant major
facilities are now in the design or construction phase, some with contracts
awarded and are funded accordingly to match latest construction schedules -
these include Te Kaha, Performing Arts (Court Theatre) and South Library.
· Significant parks
projects include Te Nukutai o Tapoa – Naval Point
development, Akaroa Wharf Redevelopment and Ōtākaro Avon River
Corridor programme.
Three Waters
· Adverse weather
events and floods around New Zealand demonstrate the importance of continued
investment for improved resilience. The stormwater and flood protection
programme has been re-phased to better align with design, securing resource
consents, community engagement and limitations of seasonal works. A lot of work
continues in this area, with excellent progress and continued funding in the
Ōpāwaho/Heathcote Catchments, and the Pūharakekenui/Styx waterway detention and treatment
facilities programme.
· Water supply sees
significant investment in the renewals programme and enhancement of water
quality through the chlorination programme, as required by the national water
regulator Taumata Arowai.
· Similarly,
wastewater sees significant investment in the renewals programme combined with
keeping our central wastewater plant meeting the needs of our city and a
significant upgrade of the Akaroa and Duvauchelle treatment schemes.
Transport
· Significant
investment is made in lifting the renewals effort in the Transport
portfolio. This includes carriageways, footpaths, bridges, signs, signals
and other structures.
· Cycleways gain
further investment and are rephased to ensure they are deliverable in realistic
timeframes.
· New and upgraded
public transport infrastructure is allowed for and currently supported by
significant external funding.
· The important link
and lifeline connection to New Brighton, the Pages Road Bridge, is phased and
allowed for based on the most recent advice from the project team.
· The final form of
the Transport programme will be dependent on policy changes and decisions by
the new Government. At the time of writing, the new government’s GPS has
not been published and therefore projections are based on current funding
levels. Our expectation is that the new GPS will be published in March 2024 and
it will have the potential to change some of our projections for the final LTP.
Solid Waste and Resource Recovery
· With the proposed closure of the current Bromley Organics
Processing Plant in 2026/27, interim arrangements for the site are in place,
ahead of the proposed new self-contained facility in Hornby opening in 2027.
Recycling and Transfer Station improvements
together with Landfill Aftercare gain significant investment to responsibly
manage our waste streams.
Capital programme
funding
5.25 The
capital programme is funded by subsidies and grants for capital expenditure,
development contributions, proceeds from asset sales, rates and debt. In
the LTP we rate for $218.8 million of renewals in 2024/25 increasing each year
to $378.7 million in 2033/34.
Borrowing
5.26 The
LTP shows gross debt rising from $2.64 billion at the start to $3.69 billion at
the end of the LTP.
5.27 Debt
repayment also rises from $69.2 million in 2024/25 to $155 million in 2033/34.
5.28 In
accordance with our Financial Strategy we will continue to ensure prudent and
sustainable financial management of our operations and will not borrow beyond
our ability to service and repay that borrowing.
Significant Assumptions
5.29 Significant
assumptions have been reviewed and updated where appropriate. There are no
significant changes from the previous annual plan. Assumptions are subject to a
rigorous sign-off process across the Council and results were reviewed by the
Audit and Risk Management Committee.
6. Financial Risk Management Strategy
6.1 The
Council’s policies to assist in managing its financial risk, including
liquidity and funding risk management, interest rate exposure and counterparty
credit risk are unchanged in this Draft LTP. An important element in assessing
the value of the Council’s risk management strategy is its five key
financial ratios (two net debt, two interest and one liquidity). All key
financial ratios are expected to be met in all years of the LTP. These are
included within the Financial Prudence
Benchmarks.
6.2 The
Debt Servicing benchmark (borrowing costs as a percentage of revenue being less
than 10%) is not forecast to be met in all years of the LTP. It is forecast at
12.6% in 2024/25, then gradually decreasing to 10.4% by 2033/34. Approximately
one third of the interest cost relates to on-lending to subsidiaries which
generates offsetting interest revenue that the ratio doesn’t consider.
Without this cost the ratio is below the 10% benchmark. There is no concern
around the ability to service the debt.
7. Fees and Charges
7.1 A
schedule of all proposed Fees and
Charges is included. In recommending the
proposed fees, staff have been conscious of the financial pressure many of our
residents and ratepayers are under, and ensure any increases to the community
would not create a barrier to utilisation of those services.
7.2 As
a result of the above, limitations imposed by the market, and the varying
inflationary impacts on costs and limits on cost recovery, fee increases
proposed for 2024/25 vary a little more than usual.
7.3 Recreation
and Sport, and Consenting fees are generally not increased as they are
considered to be at market rates.
8. Changes to Levels of Service
8.1 Guidance
during Council briefings for level of service (LOS) development was to maintain
levels of service. There are proposed minor changes to levels of service
accompanied by rationale (refer below).
8.2 Through
the Letter, Councillors asked to be engaged early on levels of service to
ensure they understood the issues. Engagement was achieved through the joint
development process, a series of briefings held between July and late November
2023 with draft activity and asset management plans presented to Councillors by
accountable Heads of Service.
8.3 Focus
areas for activity plan presentations included:
8.3.1 clear
line of sight from high level outcomes (Strategic Framework, including climate
resilience and other relevant Strategy documents) to proposed levels of service
and capital projects;
8.3.2 a
capital prioritisation process that had a focus on community need,
deliverability, affordability;
8.3.3 climate
resilience across all activities and capital portfolios;
8.3.4 levels
of service that are consistently SMART (specific, measurable, achievable,
relevant and time-bound) and which provide transparency of non-financial
performance across services, and;
8.3.5 a
reduced suite of levels of service that are most critical and meaningful.
8.4 In
summary, across all activities, changes to levels of service involve;
· Reducing the overall
number of levels of service to those that are most critical and meaningful.
This has involved a review of all performance measures and targets and
re-categorising some from ‘community’ (meaning they are visible in
the long-term plan, monthly performance reporting to Finance and Performance
Committee, and the Annual Report) to ‘management’, or operational.
This means the measure and target will still be part of the Performance
Framework and will be monitored as part of operational reporting.
· A summary of level
of service and target changes for specific activities are as follows. These are
outlined in more detail and footnoted in the Activities and Services Statement
of Service Provision:
· Recreation,
Sports, Community Arts and Events; There is an
expected increase to 40 recreation and sport facilities available for use,
reflecting the opening of Matatiki/Hornby and Parakiore facilities. As a
consequence there is also an anticipated increase in the number of participants
using multipurpose recreation and sport centres, outdoor pools and stadia, to
at least 5.6 million in year 1 to 6.0 million participations in year 10.
· Parks and
Foreshore: There are two proposed target changes
for this activity. First is the inclusion of a ‘management’
internal measure as a ‘community’-facing measure which will enable
the Council and the community to monitor achievement of community parks
maintenance plan key performance indicators following the Council’s
decision to transition from contracted service delivery to in-house maintenance
service provision. Also, the activity is also proposing the inclusion of a new
LOS and target (Neighbourhood parks are provided in urban areas at a rate of at
least 1.9 ha/1000 population), acknowledging the growing demand for additional
greenspace in areas characterised by medium to high population density.
· Water Supply: Two LOS target changes are proposed for this activity, the first is
anticipating greater average drinking water consumption per resident per day
(from <= 210 litres to <= 250 litres), the second a reduction in resident
satisfaction with Council responsiveness to water supply problems, reducing in
earlier years from >=65% to >=60%.
· Wastewater
Collection, Treatment and Disposal: This activity
is proposing one target change, halving median resolution times from
notification of overflows from network faults (from <= 24 hours to <= 12
hours).
· Flood Protection
and Control Works: One target change is proposed
for this activity, related to identification of stop banks as not meeting
original design requirements for condition and/or height (repaired within 9
months), from 100% by year 10 (2031) to 50% by year 10 (2034). Capex and opex
funding has been demonstrated to carry out minor repairs for the first 3 years
of the draft LTP. However, based on the delayed roll-out of permanent stop
banks there will be more reliance on renewal money to repair the temporary stop
banks.
· Transport: There are three proposed target changes for the activity. The first
relates to maintaining roadway condition to an appropriate national standard,
measured by the percentage of the sealed road network that is resurfaced each
year. The proposal is to reduce the percentage of resurfacing per annum from
>=5% in 2023/24 and >=6% in year 10 (LTP 2021), to >=4% for the first
two years, then lift to >=5% resurfacing from year 3 onwards. Amendment to
target is a reflection of the quantum of work achievable within the forecast
capital programme.
· The second relates
to increasing infrastructure provision for active and public modes. The
proposal is to change the target from >=600km total combined length
(cycleways and bus lanes) in 2023/24 to >= 625 km in year, >= 635 km in
year 2 and >= 645 km in year 3. The year 10 target remains >= 685 km.
Target has been revised based upon results in 2022/23 and a proposed capital
programme of approx. 10km per year of cycleways and bus lanes for the next LTP
period.
· The third proposed
target change is around more people choosing to travel by cycling. The change
is from >=13,500 in 2023/24 and >=20,000 in year 10 (per the LTP 2021) to
achieving average daily cyclist detections of >= 12,500 in year 1, >= 13,000
in year 2, >= 13,500 in year 3, forecasting >= 19,000 in year 10. The
change reflects that the majority of the major cycleway projects will be
complete by the year 10 budget, therefore we expect a levelling-off of new
cyclists.
· Solid Waste and
Resource Recovery: Proposed target change for
resident satisfaction with kerbside collection service, from 85%-90% to at
least 82%. The previous LTP target was rising to 90% satisfaction from a
four-year average of 80%. There are limited interventions that the Council can make
to lift the satisfaction rating for kerbside collection.
· Community
Housing: Two LOS changes are proposed for this
activity. First is a target change for Council to facilitate and/or fund
community housing supply, from At least 2,500 units to Years 1&2: At least
2,080 units; Y3: At least 2,300 units; Y10: At least 2,650 units. The second is
the deletion of the LOS, the Council makes a contribute to the social housing
supply in Christchurch – Council owned units are available for use
(target 1,798 units. The Council no longer has direct control of the number of
units available for use as the management of all maintenance sits with
Ōtautahi Community Housing Trust (OCHT).
· Growth and
Property: There are three LOS proposed to be
introduced with this activity. First is to deliver projects that will lead to
positive community outcomes, at least one new project commenced annually.
(Increasing the supply of community housing; or Increase employment
opportunities; or Improves Mana Whenua relationships; or Allows for community
“ownership” of service delivery; or Reduces the impacts of natural
or human induced (including climate change) hazards.) A second is proposed to facilitate housing outcomes through financing mechanisms, the target is ‘Approved financing arrangements result in new
community housing’. The third proposed LOS is to work
with our neighbours and other partners to provide regional housing advice, the
target being the Greater Christchurch Partnership
Housing Plan is ratified by the Council and the Council assists in
implementation.
· Governance and
Decision-making: The activity proposes a change to
one LOS target, resident satisfaction with participation in and contribution to
the Council’s decision-making (understanding decision-making). The target
has been ‘At least 34%’. The proposed change is, year 1 At least
32%; year 2 At least 33%; year 3 and beyond At least 34%.
· Sustainable
Economic Development: There is a proposal in this
activity relating to the “Number of major event opportunities assessed
for consideration by the agreed group of city partners”. The change is
that no targets are proposed for at least the first three years of the LTP 24,
proposing 20 major event opportunities are assessed from 2027/28. This is
reliant on when event investment funds are budgeted for in the Recreation Sport
Community Arts and Events activity. Secondly, four LOS are proposed to be
aggregated into a single measure for the LOS, “Ensure
Christchurch businesses have access to comprehensive advice and support to grow
competitiveness, resilience, and sustainability. Target is 800 businesses
access business support or advice (annually)”.
· This provides
greater clarity on the overall level of service being delivered for the
community in one simple measure and meets the Council’s direction from
the letter of expectation for a reduced suite of LOS that are most critical and
meaningful. Lastly there are four LOS proposed for deletion.
· These relate to
annual reporting on the progress of the Antarctic Gateway Strategy, the
attraction of screen productions to Christchurch through grant funding,
monitoring the number of initiatives to support cluster development, and
reporting on the feasibility of urban development proposal and projects. Their
deletion reflects directions in the Mayor and Councillor’s Letter of
Expectation to “Focus our efforts on a reduced suite of LOS that are most
critical and meaningful”.
9. Changes to Revenue, Financing and Rating Policies
9.1 The
following changes are being proposed to Rating Policies:
9.1.1 The
definition of “Business” for the purpose of General Rates
differentials is being clarified to explicitly include short-term un-hosted
accommodation (such as Air BnB, consistent with Resource Consent requirements).
9.1.2 The
City Vacant differential on the General Rate is being expanded to four suburban
areas (Linwood, Sydenham, New Brighton, and Lyttleton) in addition to the
current CBD area.
9.1.3 Active
Travel targeted rate is being combined with the Uniform Annual General Charge.
9.1.4 Heritage
Targeted Rate is being deleted and funding will now be from the General Rate.
9.1.5 Rates
Remissions for community organisations may now be applied on a sliding scale
(rather than just “full remission or nothing”).
9.1.6 Rates
Postponements will no-longer be available on demand for pensioners (a financial
hardship test will be applied, the same as for younger ratepayers).
10. Potential Disposal of Council Owned Properties
10.1 The
Council owns many types of properties. Owning property comes at a cost,
and it is good financial practice to continually review the portfolio to make
sure it is fit for purpose. If a property is no longer fit for purpose, then
the Council should decide whether to keep it or release the value of it for
community benefit.
10.2 In
2020, the Council approved a process for considering the future of properties
that are not required for their original purpose. This process was used in the
2021-2031 Long Term Plan and the 2022/23 Annual Plan. As a result of the
process the Council has declared a small number of properties surplus, as well
as deciding to fund the retention of others. Since 2021, this has resulted in
approximately $24m of revenue that has primarily been used to repay debt, and
the release of land for housing and other purposes. During this time the
Council’s property portfolio has continued to grow and there has been no
material impact on service delivery.
10.3 As
part of the draft 2024-34 Long-Term planning, Officers have used the approved
process to prepare a recommended list of properties for consultation and
possible disposal. A long list of properties was identified from both the
general portfolio and Port Hills properties transferred from the Crown
(referred to as Port Hills Residential Red Zone). Officers assessed the
long-listed properties against the following criteria adopted by the Council at
its meeting of 10 December 2021:
10.3.1 Is
the full property still required for the purpose for which it was originally
acquired?
10.3.2 Does
the property have special cultural, heritage or environmental values that can
only be protected through public ownership?
10.3.3 Is
there an immediate identified alternative public use / work / activity in a
policy, plan, or strategy?
10.3.4
Are there any strategic, non-service delivery needs that the property meets and
that can only be met through public ownership?
10.3.5 Are
there any identified unmet needs, which the Council might normally address,
that the property could be used to solve? And is there a reasonable pathway to
funding the unmet need?
10.4 Officers
assessed the Port Hills properties from a risk perspective. The Crown acquired
these properties due to a variety of geo-technical risks. Only properties where
the risk has been mitigated or through other mechanisms can be accepted have
been shortlisted for consultation.
10.5 This
list has also been reviewed by activity managers and the disposal of the
properties on the list will have no material impact on them meeting the levels
of service in their respective Activity Plans.
10.6 The
final list of those properties considered suitable for incorporation in the
draft 2024-2034 Long-Term Plan for consultation purposes can be seen at
Attachment D.
10.7 In
August 2017, the Council resolved that for a small number of specifically
identified Port Hill properties disposal should be prioritised in the following
order:
10.7.1 person(s)
or parties who sold the particular property to the Crown as a consequence of
the Crown’s Port Hills Residential Red Zoning following the earthquakes;
and
10.7.2 person(s)
or parties generally who sold properties to the Crown as a consequence of the
Crown’s Port Hills Residential Red Zoning following the earthquakes;
10.7.3 current
owner(s) of adjoining properties;
10.7.4 all
other parties.
10.8 Councillors
will be presented with advice which will enable them to confirm how they wish
this resolution to be applied prior to the adoption of the final LTP.
11. Long Term Plan Process
11.1 The
Council must, at all times, have a Long-Term Plan, must use the special
consultative procedure in adopting the plan, and the plan must be adopted
before the commencement of the first year to which it relates (s.93 Local
Government Act 2002).
11.2 The
purpose of a long-term plan is to:
11.2.1 describe
the activities of the local authority; and
11.2.2 describe
the community outcomes of the local authority’s district or region; and
11.2.3 provide
integrated decision-making and co-ordination of the resources of the local
authority; and
11.2.4 provide
a long-term focus for the decisions and activities of the local authority; and
11.2.5 provide
a basis for accountability of the local authority to the community.
11.3 A
Long-Term Plan must cover a period of not less than ten consecutive financial
years.
11.4 The
information complies with the requirements set out in Part 1 of Schedule 10 of
the LGA 2002 in respect of the information to be included in a Long-Term Plan.
11.5 The
Consultation document will state where members of the public may obtain the
underlying information, including links to all supporting documentation, on the
Council’s website.
12. Consultation and Hearings Process
12.1 Preparing
and adopting a LTP is a matter of high significance. For this reason the LGA
2002 requires the Council to use the special consultative procedure when
consulting with its community on adoption of the Plan (s 93(2) LGA 2002).
12.2 The
requirements for a special consultative procedure are set out in s 83 LGA 2002.
If approved by the Council, the following process will comply with those
requirements:
12.2.1 The
Consultation Document will be available to the public on 13 March 2024:
12.2.2 The
Consultation Document will advise members of the public where they may obtain
the information that is relied on by the document and which provides the basis
for the draft 2024-34 Long-Term Plan;
12.2.3 The
period for making submissions will run from 9am on 13 March to midnight on 17
April 2024;
12.2.4 The
consultation process will include radio advertising, articles in the Council
publications, email newsletters to subscribers, a website link to access
information. People who wish to will also be able to lodge submissions
electronically and to use other e-democracy tools such as Facebook where
appropriate;
12.2.5 It
is proposed to hold a series of community discussions between in March and
April 2024. These discussions will allow the community to engage directly
with Elected Members and Council Officers;
12.2.6 Meetings
with stakeholder groups will also be held during this period;
12.2.7 For
people who wish to, the opportunity to present their views orally will be
available from late April through May 2024 (specific dates and times to be
confirmed). The following time allocations will apply;
· Community Boards, Ngā
Papatipu Rūnanga and other councils – 10 minutes
· Groups and organisations
– 5 minutes
· Individuals –5
minutes
12.2.8 All
submissions will then be considered before the Council meets at the end of June
2024 to adopt its 2024-34 Long-term Plan.
13. Alternative Options Considered Ētahi atu Kōwhiringa
13.1 Not
applicable.
14. Detail Te Whakamahuki
14.1 The
draft Long-Term Plan process took place between March 2023 and January 2024.
The Council and staff held a series of joint development briefings many of
which were publicly accessible. This was achieved through advertising key joint
development briefing dates where the public could attend (public and
live-streamed), and releasing all briefing recordings, content and briefing
notes through Long Term Plan
2024-2034 | What matters most? | Kōrero mai | Let’s talk
(ccc.govt.nz)
14.2 The
decision affects the following wards/Community Board areas:
14.2.1 All wards and Community Board areas.
14.3 Each of the six Community Boards finalised a Community Board Plan in
May 2023. Each Plan identifies key Community Board priorities that they
wish to achieve in the current electoral term and beyond. The Plans were
made available to Heads of Service to inform the development of Activity
Plans.
14.4 Community
Board Chairs identified the top priorities within each Plan that they felt
should be funded in the draft 2024/34 LTP. These were presented to
Council on 11 October 2023. Following this staff undertook to incorporate
as many of the priorities as possible and report back to Community Boards and
Councillors. Staff reported back on 29 November advising that of the 24
priorities covered, 21 were funded and three were partially funded. A
commitment was made to discuss the partially funded priorities with the
respective Community Board in time to inform any submission the Board may wish
to make to the draft LTP.
15. Policy
Framework Implications Ngā
Hīraunga ā- Kaupapa here
Strategic
AlignmentTe Rautaki
Tīaroaro
15.1 The
Local Government Act (LGA 2002) requires local authorities to adopt a Long-term
Plan every three years (s.93).
15.2 Governance
15.2.1 Activity: Governance and decision-making
· Level of Service: 4.1.18 Participation in and contribution
to Council decision-making - Percentage of respondents who understand how
Council makes decisions: At least 34%
15.3 Internal
Services
15.3.1 Activity: Performance Management and Reporting
· Level of Service: 13.1.1 Implement the Long Term
Plan and Annual Plan programme plan - Critical path milestone due dates in
programme plans are met.
Policy
Consistency Te Whai
Kaupapa here
15.4 The
decision is consistent with Council’s Plans and Policies.
Impact
on Mana Whenua Ngā
Whai Take Mana Whenua
15.5 The decision involves a matter of interest to
Mana Whenua and could impact on our agreed partnership priorities with Ngā
Papatipu Rūnanga.
15.6 Through
Te Hononga Committee the Council directly engages with the Papatipu
Rūnanga who fall within the Council catchment as mana whenua of respective
rohe: Te Ngāi Tūāhuriri Rūnanga, Te Hapū o Ngāti
Wheke, Wairewa Rūnanga, Te Rūnanga o Koukourārata, Ōnuku
Rūnanga and Te Taumutu Rūnanga.
Climate
Change Impact Considerations Ngā Whai Whakaaro mā te Āhuarangi
15.7 The
decisions in this report are likely to:
15.7.1 Contribute positively to adaptation to the
impacts of climate change.
15.7.2 Contribute positively to emissions reductions.
15.8 The LTP contains a focus on climate change
response, with climate change considerations embedded throughout the process.
This is emphasised in the Mayor and Councillor’s Letter of Expectation
for the LTP and the Council’s Strategic Priorities and Community
Outcomes. Each Activity Plan includes a description of how that part of Council
will respond to climate impacts and reduce its emissions. Climate change is
also part of the Asset Management Plans and Infrastructure and Financial
Strategies. As a result, the LTP has an emphasis on both mitigation and
adaptation, with actions proposed across all areas of Council. Pre-engagement
consultation undertaken with the community on the LTP asked ‘what matters
most?’ This found that climate change is a top priority for Christchurch
residents across all different ages, ethnicities, and areas of our community.
The Consultation Document expands on this by providing further climate action
options for our community to consider.
Accessibility
Considerations Ngā
Whai Whakaaro mā te Hunga Hauā
15.9 Not
applicable.
16. Resource Implications Ngā Hīraunga Rauemi
Capex/Opex Ngā Utu Whakahaere
16.1 Cost
to Implement – unclear. The Letter of Engagement from AuditNZ has
yet to be received so costs and timings of the LTP audit are currently unknown.
16.2 Maintenance/Ongoing
costs - within existing budget.
16.3 Funding
Source - existing budget per Council's Long-Term Plan (2021 - 2031)
Other He mea anō
16.4 None.
17. Legal Implications Ngā Hīraunga ā-Ture
Statutory power to undertake proposals in the report
Te Manatū Whakahaere Kaupapa
17.1 The
Local Government Act (LGA 2002) requires local authorities to adopt a Long-term
Plan every three years (s.93).
Other Legal Implications Ētahi atu
Hīraunga-ā-Ture
17.2 The
Council has prepared the LTP with the inclusion of water services related
content. The Water Services Acts Repeal Bill is being introduced to
Parliament on 13 February 2024 and subject to its passing and commencement will
repeal Schedule 1AA of the Local Government Act 2002.
18. Risk Management Implications Ngā Hīraunga Tūraru
18.1 Risks
identified and managed through the general checklists and sign-offs by
management, including significant forecasting assumptions, have been reviewed
by Audit and Risk Management Committee.
19. Next Steps Ngā Mahinga ā-muri
19.1 Consultation
Document available to the public on 13 March 2024;
19.2 Hard
copies of the draft Long Term Plan 2024-2034 will be available from Te Hononga
Civic Offices on 13 March 2024, and available from the Council’s
libraries and service centres from the week commencing 18 March 2024.
19.3 Public
Notices in The Star, The Press, and on the Council’s website signalling
the start of consultation on 13 March 2024;
19.4 The
period for making submissions will run from 9am on 13 March to midnight on 17
April 2024;
19.5 For
people who indicate they wish to present oral submissions, hearings will be
held from late April through May 2024 (exact dates will be confirmed and
communicated to those submitters closer to the time);
19.6 Submissions
will then be considered before the Council meets in late June 2024 to adopt its
Long-Term Plan 2024-34.
Attachments Ngā Tāpirihanga
|
No.
|
Title
|
Reference
|
Page
|
|
a ⇩
|
LTP 2024 draft
Consultation Document
|
24/210845
|
25
|
|
b ⇩
|
LTP 2024 draft
Financial Strategy
|
23/2048736
|
60
|
|
c ⇩
|
LTP 2024 draft
Infrastructure Strategy
|
24/105908
|
74
|
|
d ⇩
|
Properties for
Decision List for Draft LTP 2024-34
|
24/202742
|
103
|
|
e ⇩
|
Audit and Risk
Management Committee Recommendation - 8 February 2024
|
24/212285
|
110
|
In addition to the attached documents, the following background
information is available:
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
|
Peter Ryan -
Head of Corporate Planning & Performance
Niel Koch -
Acting Head of Finance
Russell Holden
- Acting General Manager Resources/Chief Financial Officer
Adelaine
Hansson - Performance Analyst
Amber Tait -
Performance Analyst
Mitchell Shaw
- Reporting Accountant
Bruce Moher -
Manager Corporate Reporting
Steve Ballard
- Group Treasurer
|
|
Approved By
|
Russell Holden
- Acting General Manager Resources/Chief Financial Officer
Lynn
McClelland - Assistant Chief Executive Strategic Policy and Performance
Mary
Richardson - Interim Chief Executive
|
