Agenda of Council - 27 April 2016

Council

27 April 2016

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Key issues and funding requests for deliberation on the Annual Plan 2016/2017

Record No: R/16/4/4760

Author: Susan Cuthbert, Strategy and Policy Manager

Approved by: Rex Capil, Group Manager Community and Futures

☒ Decision ☐ Recommendation ☐ Information

Purpose

1 This report provides for decisions on the key issues and funding requests as a result of the Annual Plan (AP) submissions process.

Executive Summary

2 Council officers prepared a consultation document for the Annual Plan 2016/2017 that was adopted by Council on 27 January 2016 along with other information to support the consultation document. Public consultation on the consultation document and supporting information occurred from 27 January 2016 to 29 February 2016 and 263 submissions were received. In addition, informal feedback was received via social media. An oral submissions hearing was held on 7 April 2016 and 25 submitters spoke to their submissions.

3 At its meeting on 27 April 2016, Council will meet to resolve final issues that impact on the preparation of the final AP and supporting information. A series of issues and options (attached) reports have been prepared to assist Councillors in their decision-making. Officer recommendations resulting from these reports are included in the recommendations below.

Recommendation

That the Council:

a) Receives the report titled “Key issues and funding requests for deliberation on the Annual Plan 2016/2017” dated 20 April 2016.

b) Determines that this matter or decision be recognised as significant in terms of Section 76 of the Local Government Act 2002.

c) Determines that it has complied with the decision-making provisions of the Local Government Act 2002 to the extent necessary in relation to this decision; and in accordance with Section 79 of the Act determines that it does not require further information, further assessment of options or further analysis of costs and benefits or advantages and disadvantages prior to making a decision on this matter.

d) Attachment A - Local Roads - Agrees to staff preparing the draft Annual Plan 2016/17 to include a project to seal the Catlins Road which includes the Slope Point Road to the first carpark and the road leading to the Waipapa Point Lighthouse.

e) Attachment A - Local Roads - Agrees not to include project work to repair the Colac Bay Foreshore Road in the Annual Plan 2016/2017.

f) Attachment A - Local Roads - Agrees not to include projects to seal Roslyn Road (Roslyn Bush) and Helena and Mersey Streets (Fortrose) in the Annual Plan 2016/2017.

g) Attachment B - Heritage - Agrees to staff preparing the draft Annual Plan 2016/2017 to include a $5.00 including GST per household increase to the Regional Heritage rate - a total of $77,095 for the District.

h) Attachment C - Roading Rate Model - Endorses the Roading Rate Model methodology used to calculate outcomes in the Consultation Document for inclusion in the draft Annual Plan 2016/2017.

i) Attachment D - District and Local Issues and comments - Agrees to remove the Edendale Community Centre project from the Annual Plan budget.

j) Attachment D - District and Local Issues and comments - Agrees to forward submitters’ project suggestions to the relevant Community Board or Community Development Area Subcommittee for their follow up and investigation if considered viable.

k) Attachment D - District and Local Issues and comments - Agrees to forward submitter objection to car parking in Argyle Street on Stewart Island to the Stewart Island/Rakiura Community Board for discussion.

l) Attachment D - District and Local Issues and comments - Agrees to work with Public Health South to consider how a health in all policies’ approach may be developed.

m) Attachment E - Te Anau Wastewater Discharge project - Agrees to staff preparing the draft Annual Plan 2016/2017 on the basis that it will not include the costs of investigating alternative options for the Te Anau Wastewater Scheme at this stage on the basis that the Te Anau Wastewater Project Committee is yet to make a recommendation to Council.

n) Attachment E - Te Anau Wastewater Discharge project - Determines that should the Te Anau Wastewater Project Committee make a recommendation then this will be considered as unbudgeted expenditure at that time.

o) Attachment F - Around the Mountains Cycle Trail - Agrees to the draft Annual Plan 2016/2017 being prepared to include the Around the Mountains Cycle Trail project as previously planned.

p) Attachment F - Around the Mountains Cycle Trail - Agrees to complete the Deloitte review and wait for the decision from the Environment Court prior to making any decisions on the future of the project and its funding.

q) Attachment G - Curio Bay project - Agrees to staff preparing the draft Annual Plan 2016/2017 to include the Curio Bay project as currently scoped.

r) Attachment G - Curio Bay project - Consults with local ratepayers about local connection as part of the Long Term Plan 2018-2028.

s) Attachment H - Haast Hollyford Road - Asks staff to proceed with developing a ‘high level’ community consultation process that will enable the Council to develop an understanding of the range of community views that might exist in relation to the concept of developing a Haast Hollyford road via a public private partnership.

t) Attachment I - Rating and Finance - Agrees to staff preparing the Annual Plan 2016/2017 on the following basis:

u) Determines whether to grant funds to the Gore Kids Hub.

v) Attachment I - Rating and Finance - Agrees to staff preparing the draft Annual Plan 2016/2017 on the following basis:

i) That the Mabel Bush Hall Rate will be increased from $28.64 to $38.64 per unit (GST inclusive).

ii) That the Riverton Pool rate will be increased from $20.68 to $23.68 per unit (GST inclusive).

iii) That an extra $30,000 is included to cover the costs of implementing the next phase of the community futures project to be funded via the general rate.

iv) That an extra $32,500 is included to cover 2016 electoral expenses to be funded via the district operations reserve.

v) That Venture Southland’s revised budgets will be consolidated into Council’s forecasts for the 2016/2017 Annual Plan.

vi) That the Riverton Havelock Street kerb and channel project will be included in the NZTA 2016/2017 programme of work and the local share component be obtained.

vii) Agree to staff preparing the Annual Plan 2016/2017 on the basis that the Uniform Targeted Rate will be set at a level agreed at the Council meeting on 27 April 2016.

viii) Agree to staff preparing the Annual Plan 2016/2017 on the basis that the overall District Rate increase will be set at a level agreed at the Council meeting on 27 April 2016.

ix) That a number of projects will be carried forward from the 2015/2016 financial year as follows:

Area	Activity	Project Name	Amount

District	District Leadership	Digitisation Back Capture	$190,000
District	District Leadership	Core System Review	$750,000
District	Water	District Wide Leak Detection	$50,000
District	Water	Project Management and Design for District Monitoring Project	$17,000
District	Water	Various	$8,948
District	Water	Various	$4,982
District	Wastewater	CCTV	$50,000
District	Wastewater	Various	$54,300
District	Wastewater	Various	$9,357
District	Regulatory Services	District Plan	$75,000
District	Regulatory Services	District Plan	$100,000
District	Roads and Footpaths	Various	$686,153
Dipton	District Leadership	Information Board	-$1,000
Limehills	Stormwater	Mechanical Cleaning	$11,695
Lumsden	Community Services	Upgrade Railway Heritage Area	-$25,625
Nightcaps	Community Services	Interior Painting	-$14,666
District	Wastewater	Treatment Upgrade Stage 1	$400,000
District	Wastewater	Treatment Upgrade	$300,000
Riverton/Aparima	Roads and Footpaths	Widenings	$105,884
Riverton/Aparima	Roads and Footpaths	Kerb work on Havelock Street	$130,000
Riverton/Aparima	Roads and Footpaths	Streetlight Renewal	$5,000
Stewart Island/Rakiura	Solid Waste	replace 8 plastic rubbish bins with stainless steel	$13,000
Stewart Island	Stormwater	Rectify Main Road flooding at DOC	$40,000
District	Water	Contact Tanks	$66,430
District	Wastewater	Lateral Replacements	$124,761
District	Water	Replace reservoir tanks ahead of schedule (Kakapo)	$85,000
District	Community Services	Curio Bay Upgrade	$815,000
Tuatapere	Roads and Footpaths	General Maintenance	$5,000
Orawia	Community Services	Reroof	$21,200
District	Water	Increase Storage	$22,303
Otautau	Community Services	Upgrade Camping Ground	$220,000
Winton	Roads and Footpaths	Footpath reclamation & lichen Spray	$8,000
Winton	Community Services	Levelling Plots and resew grass	$15,000
Winton	Community Services	Skate Park upgrade	$50,000
Total			$4,392,722

w) Notes that submissions that relate to operational matters or renewal works, requests for more information for reviews and changes to programmes or projects, have been provided to relevant officers and will be considered alongside existing work programmes and actioned as appropriate.

Content

Background

4 Council is required to adopt an AP by 1 July 2016. Council officers prepared supporting information to support the development of a consultation document that was adopted by Council on 27 January 2016.

5 The consultation document highlighted two key issues for the District:

· Sealing the Catlins Road including extension to Waipapa Point

· Whether to increase the Regional Heritage rate.

6 The public consultation period was advertised by newspaper and radio, and the consultation document was distributed to all households in the District and posted to non-residential ratepayers.

7 Public consultation on the consultation document and supporting information occurred from 27 January 2016 to 29 February 2016 and 263 submissions were received. In addition comments were received via social media. An oral submissions hearing was held on 7 April 2016 and 25 submitters spoke to their submissions.

8
The majority of submitters chose to use the paper submission form insert as the main method of sending in a submission.

9 A booklet containing all the submissions was forwarded to Councillors for their consideration prior to the hearing of oral submissions on 7 April 2016.

Issues and Options Reports

10 A set of issues and options reports have been prepared that form attachments to this report.

11 Councillors will have received a complete booklet of all the submissions. The submissions have been analysed and inform the preparation of the issues, options and recommendations as set out in the following reports.

12 Councillors may identify any other issues from the submissions that they wish to discuss or consider warrants a decision or action from Council.

13 The issues that were raised in submissions fall into five broad categories:

i. Changes to proposals outlined in the consultation document, on which officers have made a recommendation. These are discussed in the attachments.

ii. Funding requests and other prominent issues raised through submissions, on which officers have made a recommended response. These are also outlined in the attachments. In all cases a response will be provided to submitters.

iii. Matters for further consideration

Other submissions raised issues that require further investigation. Where appropriate, these will be considered as part of preparing for the
Long Term plan. Some other requests may be considered as part of the policy forward work programme.

14 Due to the financial constraints the Council is operating under, including the need to stay within the parameters of its Financial Strategy, officers are only recommending budget and other changes where a proposal is sufficiently robust, clearly aligns with Council’s priorities, and has significant and broad community backing. In some cases, it is considered more appropriate to respond to the issue as part of the preparations for the Long Term Plan rather than as an AP process.

15 In 2016, Quotable Value (QV) undertook a review of the rating values (RV) throughout the Southland District. The revaluation is undertaken on behalf of Council every three years.

16 The changes to land or capital values as a result of the revaluation process does not result in any more or less rates collected rather it changes how the total rates to be collected are spread across the ratepayers.

17 The below table outlines by sector the changes to capital values as a result of the revaluation and the rates payable by these sectors in 2015/2015 and 2015/2016, along with changes to the numbers of properties within each sector. The last two columns show the percentage change between the two years of rates paid and capital value.

18 There will never be a direct relationship between the increase/decrease in capital values to the rates paid by each sector. This is due to the different ways Council uses to spread the rates across ratepayers ie: water charge, fixed rate for those connecting. The table below indicates how our rates are collected. Local rates (9%) are collected one third by a fixed amount per rating unit and the balance by land value. Although the roading rate is spread by capital value, to arrive at how much of the roading rate will be applied to a sector, a methodology is applied to determine this allocation using a number of factors including tonnage and capital value.

The below table outlines how our rates increases have tracked compared to the Consumer Price Index (CPI) and the Local Government Index (LGI).

Factors to Consider

Legal and Statutory Requirements

19 Council must, in the course of the decision-making process:

a) seek to identify all reasonably practicable options and

b) assess the options in terms of their advantages and disadvantages.

20 Before making a decision, Council may request or consider comment or advice from Council officer or any other person in respect of the proposal.

Community Views

21 Community views on the issues affecting the AP were gathered via submissions during a one month public consultation period. The submissions and informal feedback received represent the views of the Southland District residents, ratepayers and customers.

Costs and Funding

22 The financial implications of each of the options for the proposals and impact on rates were set out in the consultation document. Additional details have been included in the issues and options paper where relevant.

Policy Implications

23 Changes to the Fees and Charges Schedule were included in the consultation document. If Council decides to make changes on the basis of submissions, these will be reflected in the Annual Plan 2016/2017. The nature of the changes will determine the impact on rates and funding.

Analysis

Options Considered

24 Please see the attachments for a full list of the options for each issue.

Assessment of Significance

25 Council’s deliberations and decision-making on the issues that will inform the development of the AP, and the setting of rates, is considered to have a high level of significance. Individual issues have differing levels of significance.

Recommended Option

26 It is recommended that Council makes decisions on each of the issues set out in the attachment to this report.

Next Steps

27 Following Council’s deliberations and decision-making, Council officers will develop the draft Annual Plan and pre +sent it for adoption at Council on 29 June 2016.

Attachments

a Issues and Options Paper - Annual Plan 2016 2017 - Local Roads View

b Issues and Options Paper - Annual Plan 2016 2017 - Heritage Topic View

c Issues and Options paper - Annual Plan 2016 2017 - Roading Rate Model View

d Issues and Options paper - Annual Plan 2016 2017 - District and Local Issues and Comments View

e Issues and Options paper - Annual Plan 2016 2017 - Te Anau Wastewater Discharge Project View

f Issues and Options paper - Annual Plan 2016 2017 - Around the Mountains Cycle Trail View

g Issues and Options paper - Annual Plan 2016 2017 - Curio Bay Project View

h Issues and Options - Annual Plan 2016 2017 - Haast Hollyford Road View

i Issues and Options paper - Annual Plan 2016 2017 - Rating and Finance View

j Annual Plan 2016 2017 - Schedule of projects to be carried forward from the 2015 2016 financial year View

Council

27 April 2016

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Dog Registration Fees for 2016/2017

Record No: R/16/3/3525

Author: Michael Sarfaiti, Environmental Health Manager

Approved by: Bruce Halligan, GM - Environment and Community

☒ Decision ☐ Recommendation ☐ Information

Purpose

1 To set the dog control fees for the 2016/2017 year.

Executive Summary

2 Council’s dog control fees must be prescribed by resolution. It is proposed to continue the current fees for the 2016/2017 year, other than the addition of a proposed new fee concerning the withdrawal of infringements.

Recommendation

That the Council:

a) Receives the report titled “Dog Registration Fees for 2016/2017” dated 14 April 2016.

b) Determines that this matter or decision be recognised as not significant in terms of Section 76 of the Local Government Act 2002.

c) Determines that it has complied with the decision making provisions of the Local Government Act 2002 to the extent necessary in relation to this decision; and in accordance with Section 79 of the Act determines that it does not require further information, further assessment of options or further analysis of costs and benefits or advantages and disadvantages prior to making a decision on this matter.

d) Sets the dog control fees in Attachment A for the 2016/2017 registration year.

e) Publicly notifies the fees in the Southland Times on Saturday, 4 June 2016 and Saturday, 11 June 2016.

Content

Background

3 The Dog Control Act 1996 requires territorial authorities to set dog control fees. The Council currently has approximately 13,000 registered dogs within its District.

4 The Dog Control service operates a register of dogs, investigates complaints about dogs, monitors the District, and promotes responsible dog ownership.

5 The Dog Control business unit is staffed by a manager, one full-time and two part-time dog control officers, a customer services officer and a number of casual rangers.

6 Council has a combined dog pound with the Invercargill City Council. Council has a licence to occupy the pound with an exclusive licence to use five of the 28 kennels.

7 The dog registration fee history is as follows:

Issues

Continuation of fees

8 It is proposed to continue the current fees, with the exception of one new fee as described below. The proposed fees for 2016/2017 are in Attachment A.

New fee

9 It is proposed to introduce a new fee of $30.00, for withdrawal of infringements. Infringement fines are referred to the Courts for collection after the objection period has closed. Occasionally infringements are waived when the infringements are with the Court for collection, and Council is required to pay the Court a fee for withdrawing an infringement. This fee enables Council to recover this cost when it is reasonable to do so.

Reserve

10 Currently the dog control reserve is about $280,000. There are a number of reasons why the reserve should not be used to offset fees:

• Keeping fees lower for longer.

• Two new licensing systems are being introduced in dog control (multiple dogs and registration discounts), and the costs associated with this are not fully known.

• A reserve is sensible in the event that more pound capacity is needed in future.

• Increasing costs relating to health and safety and vehicle operations.

Proposed discounts

11 It is proposed to introduce discounts into dog registration fees in 2017/2018. Discounts are proposed for good behaviour and microchipping, neutering and effective containment. Information about the proposed fees will be sent in the dog registration packs sent out to all dog owners in June this year.

12 These discounts, along with the transition period, were approved by Council during the recent dog control bylaw review.

13 Some information concerning the proposed discounts is in Attachment B.

Factors to Consider

Legal and Statutory Requirements

14 Section 37 of the Dog Control Act 1996, that is concerned about fee setting, is in Attachment C.

15 The Council is legally required to set the fees by resolution and to subsequently publicly notify these fees.

Community Views

16 Members of the community will have an opportunity to express their views on the registration fees when they are publicly notified.

Costs and Funding

17 The dog control service is funded mainly from registration fees, and also from infringements, and fees and charges. Council has resolved that dog control is to be fully funded by fees and charges.

Policy Implications

18 There are no specific policy and plan considerations.

Analysis

Options Considered

19 There are no options, Council must set dog control fees by resolution and may make any changes to the proposed fees in Attachment A as it sees fit.

Analysis of Options

That Council sets the dog control fees in Attachment A for the 2016/2017 registration year, with any amendments as it sees fit.

Advantages	Disadvantages
· The recommended fees are considered suitable for the District.	· None identified.

Assessment of Significance

20 This review is considered to be not significant in accordance with Council’s Significance and Engagement Policy.

Recommended Option

21 Not applicable.

Next Steps

22 Council’s decision will be publicly notified in the Southland Times and also on Council’s website; and the fees will come into effect on 1 July 2016.

Attachments

a Proposed Dog Control Fees View

b Information about the proposed discounts in 2017/18 View

c Section 37 of the Dog Control Act View

Council

27 April 2016

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Food Act 2014 Delegations

Record No: R/16/3/3303

Author: Michael Sarfaiti, Environmental Health Manager

Approved by: Bruce Halligan, GM - Environment and Community

☒ Decision ☐ Recommendation ☐ Information

Purpose

1 To make delegations under the Food Act 2014.

Executive Summary

2 The Food Act 2014 came into fully into force on 1 March 2016. Council may wish to delegate certain functions and duties under this Act to the Chief Executive, who may then in turn sub-delegate to staff.

Recommendation

That the Council:

a) Receives the report titled “Food Act 2014 Delegations” dated 4 March 2016.

b) Determines that this matter or decision be recognised as not significant in terms of Section 76 of the Local Government Act 2002.

d) Delegates all of its responsibilities, duties and powers under the Food Act 2014 and Regulations made under it to the Chief Executive; except the following:

(i) Section 173 (2) Agreement to combine functions with other territorial authorities.

(ii) Section 176 Transfer of functions to other territorial authorities or regional councils.

(iii) Section 179 Transfer of function to chief executive of Ministry of Primary Industries.

(iv) Section 182 Change revocation etc of any transfer under Section 179.

(v) Section 205 Power to fix fees.

The Chief Executive has the power to sub-delegate any of the responsibilities, duties and powers.

Content

Background

3 Council has a delegations register, for the purpose of the efficient provision of services.
The Food Act 2014 (the Act) came into force on 1 March 2016, and Council has not made any delegations under this Act.

4 At the time of writing, the Ministry for Primary Industries is developing national systems for councils to use, in regard to registration of food businesses, and uploading inspection data.

5 The Act is being implemented over a three year transition period, ending on 28 February 2019.

6 Environmental Health staff from the Gore District and Invercargill City Councils have jointly sought advice from Council’s solicitor for recommended delegations. These are recommended below for adoption.

Issues

7 Councils have a number of roles, functions, and duties under the Act such as:

· provision of advice; and

· the dissemination of information on matters relating to

· performing the function of a registration authority; and

· carrying out enforcement and other regulatory responsibilities.

· carrying out the role of a recognised agency; and

· to manage and train its staff to carry out functions and activities in relation to this Act.

· to manage verification functions.

· to investigate non-compliance and complaints regarding.

· to respond to recalls and to respond in an emergency situation.

· to perform administrative functions relating to this Act.

8 This report proposes to delegate all powers needed to be exercised on a day to day basis at a staff level, if the Council’s functions and duties are going to be undertaken successfully.

9 The delegation will give the Chief Executive the power to appoint food safety officers.

Factors to Consider

Legal and Statutory Requirements

10 Clause 32 of the 7th Schedule of the Local Government Act 2002 enables Council to make the recommended delegations in this report.

11 Council’s solicitor has drafted the recommended delegations in this report. He recommends that this delegation along with the delegations register follows the format of having a section on statutory functions with delegations to the Chief Executive with the power for him to sub-delegate any of the responsibilities, powers etc to staff unless sub-delegation is expressly excluded.

Community Views

12 There is no requirement to consult, as delegations are an operational matter. The delegations as proposed will assist with the efficient and cost effective implementation of the Act for communities and customers.

Costs and Funding

13 Delegations are an efficiency that will reduce Council and staff time in undertaking the delegated duties.

Policy Implications

14 There are no policy implications.

Analysis

Options Considered

15 The options are whether or not to delegate.

Analysis of Options

Option 1 - That Council adopts the following delegation:

16 Delegates all of its responsibilities, duties and powers under the Food Act 2014 and Regulations made under it to the Chief Executive; except the following:

(i) Section 173 (2) Agreement to combine functions with other territorial authorities.

(ii) Section 176 Transfer of functions to other territorial authorities or regional councils.

(iii) Section 179 Transfer of function to Chief Executive of Ministry of Primary Industries.

(iv) Section 182 Change revocation etc of any transfer under Section 179.

(v) Section 205 Power to fix fees.

17 The Chief Executive has the power to sub-delegate any of the responsibilities, duties and powers.

Advantages

Disadvantages

· Efficient delivery of services.

· Cost savings.

· None identified.

Option 2 - That Council does not adopt the delegations in whole or in part.

Advantages	Disadvantages
· None identified.	· The Council would not be able to effectively and efficiently deliver services under the Act.

Assessment of Significance

18 The delegation is not considered significant in relation to Council’s Significance and Engagement Policy.

Recommended Option

19 Option 1 is recommended for the efficient and effective administration of the Act. Should Council choose not to make these delegations, then a number of decisions will be subject to delays, having to be considered by Council at its meetings.

Next Steps

20 I will present a report to the Chief Executive with recommendations for sub-delegations, who may then sub-delegate some or all of his delegated powers to staff.

Attachments

There are no attachments for this report.

Council

27 April 2016

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Food Act 2014 - Combined Registration Authority

Record No: R/16/3/3378

Author: Michael Sarfaiti, Environmental Health Manager

Approved by: Bruce Halligan, GM - Environment and Community

☒ Decision ☐ Recommendation ☐ Information

Purpose

1 To support the creation of a combined registration authority under the Food Act 2014.

Executive Summary

2 The Food Act 2014 enables Southland District Council (SDC) to combine with other councils to create a combined registration authority. The “Ease of Doing Business” work currently being undertaken under the Southland Regional Development Strategy has highlighted a desire from industry to see uniformity across councils for regulatory matters. A combined registration authority will meet these expectations.

Recommendation

That the Council:

a) Receives the report titled “Food Act 2014 - Combined Registration Authority” dated 14 April 2016.

b) Determines that this matter or decision be recognised as not significant in terms of Section 76 of the Local Government Act 2002.

d) Authorises the Chief Executive to enter into a written agreement to combine with one or more southern territorial authorities for the purpose of performing the function of a registration authority under the Food Act 2014 in the combined district of the territorial authorities that are parties to the agreement.

Content

Background

3 The Food Act 2014 (the Act) enables SDC to combine with other councils to create a combined registration authority.

4 Most food businesses are required to register with the local council. Registration is an administrative process where the business completes an application form at set intervals with the payment of a fee, and information about the business is recorded in the council’s register.

5 Registration is separate to SDC’s verification function. Verification is the term used in the Act for auditing of food premises, and is conducted by SDC’s Environmental Health Officers or third party Auditors.

The New Food Act Approvals

6 There are two new types of Council approval for food businesses, food control plans and national programmes. Which one is needed depends on the type of business. Higher risk businesses due to extensive food handling, such as restaurants and takeaways, need a food control plan, and lower risk businesses such as dairies and service stations will need the national programme.

7 A food control plan sets out what steps a business making or selling higher-risk foods needs to take to make safe food. A national programme is a less onerous approval process, with the controls summarised as “People, Places, Product, and Processes”.

Environmental Health Contracts

8 The following is the current environmental health contracting arrangements:

· GDC contracts SDC for environmental health services.

· Both Clutha District (CDC) and Central Otago District (CODC) Councils have entered recent contracts for ICC to provide some environmental health services. Queenstown Lakes District Council (QLDC) up to recently provided food licensing services to CODC.

· Dunedin City Council (DCC) and QLDC currently do not provide environmental health services to other councils.

Buy-in from other Councils

9 Staff from GDC and ICC have expressed interest in a combined registration authority with SDC.

10 Staff have not had discussions with any other councils concerning this issue. It is feasible that CDC and CODC may wish to combine with the Southland councils, given their current contractual arrangements with ICC.

Issues

Ease of doing business

11 SDC staff are currently involved in an ease of doing business discussion, as part of the Regional Development Strategy. Industry representatives have expressed a desire to reduce inconsistencies between local councils, and are seeking more uniformity.

12 The recommendation of this report is one step towards achieving more uniformity among the councils.

Different registration software systems

13 ICC and SDC use Pathway software for registration purposes, whereas GDC uses Authority software. CDC and DCC also use Pathway, but QLDC uses TechOne, and CODC uses NCS (Napier Computer Systems).

14 Any councils that wish to combine that have different systems will have some technical difficulties.

15 To avoid technical difficulties, each individual council may wish to record registration data on their own systems, rather than in one centralised register, during the three year transition period of the Act (ending on 28 February 2019).

16 Despite this, each council can use the same documentation and processes, achieving the uniformity that is desired by industry.

17 In other words staff believe that a virtual combined registration authority may be the best way of operating any combined registration authority in the short-term. From a customer point of view, the combined authority would appear to be one entity, though in practice registration data would be held on each of the councils’ systems.

Fees

18 Under the new legislation, the registration fee is separate to the verification fee. The proposed 2016/2017 registration fee at SDC is $73, for an existing business. A comparison cannot be provided with other councils at present, as none have adopted the new fee structure as recommended by the Ministry for Primary Industries cost recovery guidance, published in September 2015.

19 A combined authority should ideally have the same registration fee. This may be an issue to consider in the near future, but staff do not regard it as an issue that should hinder the potential formation of a combined registration authority.

One Council providing the registration service

20 An option is for one council to perform the registration function for the combined authority. During the three year transition period, councils may wish to retain their own systems. This is because during this period councils have exclusivity of verification for food businesses with templated food control plans within their Districts, and so will want to have ready and accurate access to registration data for these premises.

21 Also, councils will now be able to compete against each other for verification of food businesses operating under a National Programme. Under the former legislation, councils could not offer health inspection services to food businesses in neighbouring councils’ districts. For this reason, there may be some reluctance to have only one council performing this function as this may give the council a competitive advantage.

22 There have been no discussions about the new competitive element of the new Act. Clearly, councils cannot make anti-competitive arrangements with each other. At this point, there is no intention for SDC officers to seek business in other council districts, though this may change if additional income is warranted and there is spare capacity in the team.

Factors to Consider

Legal and Statutory Requirements

23 The recommendation of the report is enabled under Section 173 of the Act:

173 Functions of territorial authority

(2) A territorial authority may, by written agreement, combine with one or more other territorial authorities for the purpose of performing the function of a registration authority referred to in subsection (1)(a) in the combined district of the territorial authorities that are parties to the agreement.

(3) If two or more territorial authorities have combined under subsection (2), they may designate any of them as the territorial authority responsible for performing the function of a registration authority for the combined district.

Community Views

24 There is no requirement to consult, as this is an operational matter.

Costs and Funding

25 There are no cost implications. Forms, procedures and so on can be developed by environmental health staff. This is under the assumption that software will not need to be updated, which will be the case if SDC continues to use its existing registration system.

Policy Implications

26 There are no policy implications.

Analysis

Options Considered

27 The options are whether or not to support a combined registration authority.

Analysis of Options

Option 1 - Authorises the Chief Executive to enter into a written agreement to combine with one or more southern territorial authorities for the purpose of performing the function of a registration authority in the combined district of the territorial authorities that are parties to the agreement

Advantages

Disadvantages

· Uniformity and consistency in the registration process in Southland.

· Working together where the legislation enables combined work.

· Sharing of costs and expertise.

· Some difficulties expected in working through current inconsistencies.

· Additional staff time needed to implement a combined agency.

Option 2 - Status quo, Council will be the registration authority for the Southland District

Advantages	Disadvantages
· SDC’s registration systems are effective and there is no functional need to combine with another agency.	· Does not meet the expectations being raised from the industry during the Ease of Doing Business discussions.

Assessment of Significance

28 This issue is not considered significant in relation to SDC’s Significance and Engagement Policy.

Recommended Option

29 Option 1 is recommended.

Next Steps

30 Should either/both ICC or GDC resolve similarly, then the CEO may then enter into written agreements with them.

Attachments

There are no attachments for this report.

Council

27 April 2016

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Forecasted Financial Position for the year ending 30 June 2016

Record No: R/16/4/5499

Author: Susan McNamara, Management Accountant

Approved by: Anne Robson, Chief Financial Officer

☒ Decision ☐ Recommendation ☒ Information

Purpose

1 To inform Council of the forecasted changes to the 2015/2016 Long Term Plan budget and to seek approval where necessary for anticipated unbudgeted expenditure included in the forecasts.

Executive Summary

2 Forecasting the financial position for the year ended 30 June 2016 is intended to provide information at an earlier stage of the year of any changes from what was included in the Long Term Plan.

3 Forecasting enables the organisation at all levels to understand the anticipated year end position and expected cashflow. It will also assist with decisions and priorities for spending being made across the organisation.

4 The budgeted expenditure included in the Long Term Plan for the 2015/2016 year was set nine months before the start of the financial year. Forecasting allows a formal process to communicate to Council and the Executive Leadership Team (ELT) any known changes. The net amount by business units is shown in Attachment A.

5 Approval is also sought for expenditure that has been identified as part of this process that has either not been included or amended from the amount included in the Long Term Plan for 2015/2016.

Recommendation

That the Council:

a) Receives the report titled “Forecasted Financial Position for the year ending 30 June 2016” dated 19 April 2016.

b) Determines that this matter or decision be recognised as significant in terms of Section 76 of the Local Government Act 2002.

d) Approve the forecasted changes to Council’s year-end financial position.

Content

Background

6 For the first time forecasting of the year end position has been completed during the 2015/2016 financial year. Forecasting has been completed twice during the year aligned with the internal corporate reporting. This was in November and March for the preceding four month period.

7 The second round of forecasting has been undertaken by Council staff during the first two weeks of March with the February financial results being available for reference. Council staff were asked to forecast the year end position with any changes that have occurred since the October forecast was undertaken.

8 Forecasting is not intended to involve the time and effort undertaken in the annual budgeting process. A methodology was developed by finance (including discussion with some budget managers) and the ELT that is expected to identify any issues without a significant time commitment.

9 Budget managers were requested to include forecasts for their business units where the expected overall outcome would vary from the budget in the Long Term Plan by specified tolerance levels. These net levels were set at $1,000 for Council-owned halls; between $1,000 and $10,000 for townships (depending on their operational expenditure in the current year) and $10,000 for all District business units. The maximum limit of $10,000 was set in line with the delegation held by the Chief Executive in relation to him approving unbudgeted expenditure.

10 Finance reviewed the impact that the organisational review and vacancies will have on wages to the end of June 2015-2016. Where significant variation has been identified a forecast has been included. Across the organisation it is forecast that wages will be $370K under the budget included in the Annual Plan.

11 No forecasting has been completed in relation to non-cash expenditure eg depreciation, revaluation of fixed assets.

12 During the second round of forecasting a reasonable number of adjustments have been made. To provide an overview of these Attachment A provides details of business units where there has been a significant dollar variation. Attachment B shows the changes that have been made a business unit level due to changes to projects, that are not part of the staff submission for the on the draft Annual Plan 2016/2017.

13 Attachment A shows the net adjustment by the individual business units, rather than every individual line adjustment. These have been split between district and local business units, showing the forecast change for each round. A summary of the commentary from the budget manager has been included.

14 Forecasting is to be used for the performance measure included in Asset Management Plan/Activity Profiles for capital financial sustainability. The performance measure is entitled financial sustainability, with a purpose to encourage the activity to be managed cost effectively. The specific measure is ‘that capital work is completed on time and to be within budget as determined by the forecast completed at the end of the second quarter’. This will be measured from the forecasted information completed with this second round of forecasting.

15 During the second round of forecasting a number of projects have been identified as not being expected to be completed during 2015/2016. Some of these projects have been deferred to 2016/2017 and been included as a staff submission on the draft Annual Plan. As the detail of these projects has been included in the staff submission they have not been included again in this report. Projects that have been deleted entirely or are now expected to be completed 2017/2018 or later have been included in Attachment B. Projects moved out beyond 2016/2017 financial year will be included in the relevant draft Annual Plan.

Issues

16 Historically Council has been in the position of having surplus cash funds, with limited or no debt. The Long Term Plan indicates that Council will go into debt in the 2017/2018 financial year. When this occurs variations from the expected cashflow for the year will need to be understood to ensure appropriate cash management. It is expected that forecasts provided by the organisation will assist with this.

17 It is expected that the organisation will improve their forecasting as more iterations of the forecasting process are completed.

18 Forecasting provides an additional process to gain approval for anticipated unbudgeted expenditure during the year. Using the forecasting process for approval of multiple items of additional expenditure should reduce the number of individual reports needed to be handled by Council. Council will still need to approve some expenditure items separately where the expenditure is large enough to need to be considered individually or where the expenditure has arisen outside the forecasting timelines. There are two reports on the Council agenda today, which have arisen outside the forecasting timelines.

Factors to Consider

Legal and Statutory Requirements

19 Council needs to ensure that community views are considered for all matters deemed significant under the Significance and Engagement Policy. Where Council staff were aware significant projects are being deferred from 2015/2016 in October 2015 they have been included in the draft Annual Plan for 2016/2017. Examples of these projects include changes to the Southern Scenic Route, Mararoa Bridge and digitisation.

20 Council staff must ensure that all expenditure is carried out within approved delegations. The current financial delegations only allow the Chief Executive to approve unbudgeted expenditure up to $10,000.

Community Views

21 Consultation was held with the community for the expenditure included in the 2015/2016 budget as part of the Long Term Plan.

22 Expenditure (both capital and operational) relating to townships has been discussed with the relevant Community Board or Community Development Area Subcommittee before being included in this forecast.

23 The community has had an opportunity to comment on some of the changes in operational expenditure where polices and bylaws have been out for consultation. An example of this is the change in income for annual liquor licence fees.

Costs and Funding

24 Forecasting completed shows that overall net effect on the statement of Financial Performance for the year is a reduction to the Net Surplus of $5.64M. $571K has been identified in the second round of forecasting. This has moved the expected surplus after tax from $2.499M to an expected deficit after tax of $3.356M. A difference in the actual revaluation of forestry assets and depreciation could have a major impact on this result. An example of this was in 2014-2015 where the actual depreciation differed to budget by $4.3M.

25 Forecasting has also shown a net reduction of $10,578M in capital work being completed in the current financial year. Of this $4.13M is included in the staff submission to be included in the Annual Plan for 2016/2017. This reduction is broken down by activity on the following table.

Activity	Amount to Carry Forward to 2016/2017
Community Services	$1,065,909
District Leadership	$939,000
Roads and Footpaths	$927,037
Solid Waste	$13,000
Stormwater	$40,000
Wastewater	$888,418
Water	$254,663

Policy Implications

26 There are no significant policy implications.

Analysis

Options Considered

27 The options are whether or not to approve, in full or part, the forecasted adjustments to the financial statements and additional expenditure in the Long Term Plan.

Analysis of Options

Option 1 - Approve the forecasted changes to Council’s year end financial position. This expenditure is not included in the Long Term Plan for 2015/2016

Advantages

Disadvantages

· Council is informed of anticipated changes from the Long Term Plan for 2015/2016.

· Council has had the opportunity to prioritise expenditure to be incurred in the current financial year.

· Council staff are able to purchase services as required to provide services to the community in the most appropriate manner.

· None identified

Option 2 - Approve part the forecasted changes to Council’s year end financial position. This expenditure is not included in the Long Term Plan for 2015/2016

Advantages

Disadvantages

· Council is informed of anticipated changes from the Long Term Plan for 2015/2016.

· Council has had the opportunity to prioritise expenditure to be incurred in the current financial year

· Council considers that the additional expenditure is not a current priority and does not need to be incurred.

· Processes may be delayed where further approval needs to be sought from Council before committing to additional expenditure.

Option 3 - Not approve the expenditure in Attachment B. This expenditure is not included in the Long Term Plan for 2015/2016

Advantages

Disadvantages

· Council is informed of anticipated changes from the Long Term Plan for 2015/2016.

· Council has had the opportunity to prioritise expenditure to be incurred in the current financial year

· Processes may be delayed where further approval needs to be sought from Council before committing to additional expenditure.

Assessment of Significance

28 The content of this report is deemed significant under the Significance and Engagement Policy as the financial impact in Attachment C is greater than the $2M included as a measure of financial impact in the Significance Policy.

29 The deferral of the Southern Scenic Route, Mararoa Bridge and the digitisation project have been debated with regard to whether they are an issue that has a major/long term effect to either the District or a local community. As these items have only changed in timing to be delivered now in 2016/2017 it has been decided no major/long term exists as the community will be able to make submissions on these projects as part of the Annual Plan process.

30 As the projects have been deferred rather than removed no additional engagement of the community is required beyond the Annual Plan process.

Recommended Option

31 Option 1 to receive the forecasted adjustments to the financial statements and approve the expenditure in Attachment B not included in the Long Term Plan for 2015/2016.

Next Steps

32 To advise managers of the approval of additional expenditure for the 2015/2016 financial year.

33 Ensure that deferred projects approved by Council during deliberations for the Annual Plan are included in the Annual Plan for 2016/2017 financial year.

Attachments

a Forecasted Net Expenditure Adjustment by Business Unit (March) View

b Forecasted Changes to Projects in the 2015/2016 Financial Year View

c Forecasted Statement of Comprehensive Revenue and Expenditure View

Council

27 April 2016

FORECASTED NET EXPENDITURE ADJUSTMENTS BY BUSINESS UNIT

Business Unit	Net Amount in March round	Net Cost Reduction or Additional	Net Amount for the year	Net Cost Reduction or Additional	Funding Source	Summary Reason
District Business Units
Various Business Units	15,000	Reduction	15,000	Reduction	Reserve	Adjustment to wages
Various Business Units	248,000	Reduction	248,000	Reduction	Internal charge to other business units	Adjustment to wages
Financial Services	102,896	Reduction	143,360	Reduction	Internal charge to other business units	Adjustment to wages, reduction in LINZ, Quotable NZ fees and Insurance offset by additional training, postage and insurance brokerage fees.
Knowledge Management	190,000	Reduction	690,000	Reduction	Loan	Part of Digitisation project to be deferred to 2016/2017.
Information Management	15,000	Additional	88,000	Additional	Internal charge to other business units	Estimate for year of expected software licence fees and maintenance on equipment, where 2015/2016 budget was under estimated. Additional consultant costs to cover vacant positions, offset by adjustment to wages.
Information Management	750,000	Reduction	750,000	Reduction	Loan	Programme of work yet to be finalised which will push the work into future years
Secretarial Services	59,000	Reduction	59,000	Reduction	Internal charge to other business units	Adjustment to wages offset by increased advertising costs
Strategy and Communication	5,000	Additional	5,000	Additional	Internal charge to other business units	New online submission form developed for the Annual Plan
Chief Executive	255,000	Additional	233,351	Additional	Reserves	Adjustment to wages and increase in consultant costs offset by reduction in cell phone charges and legal fees.
Around the Mountains Cycle Trail	526,868	Additional	263,154	Reduction	Loan/Reserves	Adjustment to estimated costs of consent in the second round. Previously reduction in expected income offset by budgeted expenditure on stages 8 & 9 not being completed in the current year
Property Sales	63,872	Reduction	63,872	Reduction	Reserves	Sales of land for Greenhills quarry and part of stopped roads
Property Administration	57,000	Additional	57,000	Additional	Reserves	Additional Employees in place
Water Services	55,000	Reduction	87,000	Reduction	Reserve	Adjustment to wages and the cost of the Hansen 8 upgrade project has been split over three business units. The amount charged to this business unit has been completed under budget.
District Water	149,663	Reduction	199,663	Reduction	Loan	Balancing up of projects deferred at a town level along with WAT950 & WAT987 District Monitoring Project deferred to 2016/2017 to enable meters to be installed first.
District Sewerage	962,418	Reduction	962,418	Reduction	Loan	Balancing up of projects deferred at a town level along with CCTV work deferred to 2016/2017 due to unavailability of suitable equipment. Also an allowance for peer review being completed by Pattle Dalmore.
Building Regulation	178,545	Additional	178,545	Additional	Reserve	Reduction in consent income received offset by adjustment in wages
Dog and Animal Control	20,000	Reduction	1,000	Additional	Reserve	Additional income from dog registration offset by previous adjustment to licence fee income reduced due to Council resolution to have fee discounts instead of the responsible owner licence. Also income reduced as free microchipping to continue. Additional costs for pound maintenance as underestimated.
Resource Consent Processing	168,658	Additional	209,542	Additional	Reserve	Additional legal and consultant costs in relation to a consent appeal that is non-recoverable. along with reduction in consent and compliance monitoring income with reports improving efficiency of visits and level of monitoring required.
Resource Planning/Policy	175,000	Reduction	175,000	Reduction	Reserve	Work on the District Plan not completed during the year due to mediation/appeal process on hold.
Council and Councillors	15,000	Additional	15,000	Additional	Reserve	Payment of communication payment for three years.
Council contributions/Grants	15,000	Additional	15,000	Additional	Reserves	Funding for Pork Pie and Lonely Girl
Roading – District Wide	651,662	Reduction	1,266,637	Reduction	Loan	Lower costs due to tender prices received combined with a low bitumen price. Change in scope/timing of projects is offset by reduced income from NZTA.
Waikaia Forest	10,403	Additional	771,628	Additional	Reserve	Maintenance on tree in river. No harvesting occurring this financial year so no income being received with a small offset from costs reduced to reflect this.
Work Schemes	12,000	Additional	12,000	Additional	Reserve	Net effect of reduced income die to reduced staffing level.
Toilets – Colac Bay Playground	2,000	Additional	2,000	Additional	Reserve	Increase in cleaning and maintenance
Toilets – Colac Bay East End	1,500	Additional	1,500	Additional	Reserve	Increase costs for portaloo hire offset by reduced cleaning costs
Toilets – Garston	45,578	Additional	-	No effect		Amount capital project reduced in October round now reinstated.
Toilets – Lumsden	2,207	Additional	2,207	Addiitonal	Reserve	Budget held in separate business unit for maintenance
Toilets – Nightcaps	8,400	Reduction	8,400	Reduction	Reserve	Budget for maintenance has not been required this year
Toilets – Orepuki Hall	3,050	Additional	3,050	Additional	Reserves	Increase in usage requiring additional supplies and a repaint completed before the 150^th celebrations
Library – Riverton	20,000	Reduction	20,000	Reduction	Reserve/ Internal charge to other business units	Adjustment to wages
Toilets – Cosy Nook	1,200	Additional	1,200	Additional	Reserve	Budget needed for maintenance
Stewart Island sewerage	50,000	Additional	50,000	Additional	Development Contributions	Additional project required at ponds. Report included in Council agenda 27 April 2016 for approval.
Toilets Thornbury Playground	1,500	Additional	1,500	Additional	Reserve	To allow for maintenance work to be completed
Local Business Units
Browns Street Works	1,000	Additional	1,000	Additional	Reserves	Tree trimming required under power lines
Dipton Operating costs	1,000	Additional	1,000	Additional	Reserves	Work begun on Information Board earlier than 2016/2017.
Edendale Hall	477,400	Reduction	477,400	Reduction	Grants/Reserves, Contribution levies	Building project removed as included in 2016/2017 draft annual plan. Offset by repayment of grant received from Transpower.
Garston Playground	3,500	Additional	3,500	Additional	Reserves	Installation of concrete surround at playground agreed with the CDA
Limehills Operating Costs	5,994	Additional	5,994	Additional	Reserves	Restore the Limehills War Memorial from funds received in 2014/2015.
Limehills Stormwater	11,695	Reduction	11,695	Reduction	Reserves	Community Board advised the project to be undertaken in 2016/2017 as drains have been sprayed this year.
Limehills Beautification	1,000	Additional	1,000	Additional	Reserves	Finished a project from 2014/2015 tidying the Community Centre car park area.
Lumsden refuse collection	4,000	Additional	4,000	Additional	Reserves	Additional demand on bins requiring more frequent collection
Lumsden Stormwater	11,000	Reduction	11,000	Reduction	Reserves	Investigation project STO187 completed for less than budget.
Lumsden Cemetery	5,960	Additional	5,960	Additional	Reserves	Drainage required around graves, previously approved by Council
Lumsden Recreation Reserve	1,215	Additional	1,215	Additional	Reserves	Increase in insurance cost for the year.
Lumsden Playground	25,625	Additional	25,625	Additional	Reserves	Project for under 5 year old playground and dust suppression budgeted in 2016/2017 started in 2015/2016.
Mossburn Operating Costs	7,000	Additional	7,000	Additional	Reserves	Funds donated to hall for flood repairs and information kiosk
Mossburn Street Works	25,730	Additional	25,730	Additional	Reserves	Asphalt footpath in Devon Street requested by CDA.
Mossburn Playground	3,321	Additional	3,321	Additional	Reserves	Upgrade of border to be funded from funds received in 2014/2015.
Nightcaps Street Works	1,400	Additional	1,400	Additional	Reserves	Additional work required to footpath due to house fire and slip. This is the net additional cost as NZTA is provided a contribution.
Riverton Harbour	2,000	Additional	2,000	Additional	Reserve	Public Liability Insurance required for the first time
Stewart Island Jetties	14,000	Additional	14,000	Additional	Reserve	Funded from a $20k grant received in 2014/15 from the Stewart Island visitor Levy. Quote from Entech for $14,000.00.
Recreation Reserve - Glenburn	6,000	Additional	6,000	Additional	Reserve	several small projects being completed, all from arboretum reserves
Winton Memorial Hall	410,000	Additional	410,000	Additional	Reserve	Additional $385,000 funds for project CC0042 approved by Council on 27 January 2016 per & $25,000 approved on 9 March 2016

Council

27 April 2016

FORECASTED CHANGES TO PROJECTS IN THE 2015/2016 FINANCIAL YEAR

Business Unit	Net Amount in March round	Net Cost Reduction or Additional	Net Amount for the year	Net Cost Reduction or Additional	Funding Source	Summary Reason
District Business Units
Toilets – Athol	24,483	Reduction	24,483	Reduction	Loan/Reserve	Project completed
Lumsden Sewerage	24,000	Reduction	24,000	Reduction	District Sewerage	WW141 for a new manhole not required as alternative methodologies adopted to repair the wet well.
Ohai/Nightcaps water supply	30,000	Reduction	30,000	Reduction	District Water	WAT344 for bypass tank to clarifier is being deferred to 2018/2019
Stewart Island sewerage	50,000	Additional	50,000	Additional	Development Contributions	Additional project required at ponds. Report included in Council agenda 27 April 2016 for approval.
Local Business Units
Edendale Hall	477,400	Reduction	477,400	Reduction	Grants/Reserves, Contribution levies	Building project removed as included in 2016/2017 draft annual plan. Offset by repayment of grant received from Transpower.
Limehills Beautification	1,000	Additional	1,000	Additional	Reserves	Finished a project from 2014/2015 tidying the Community Centre car park area.
Lumsden Playground	25,625	Additional	25,625	Additional	Reserves	Project for under 5 year old playground and dust suppression budgeted in 2016/2017 started in 2015/2016.
Manapouri Hall	-	-	27,290	Additional	Reserve	2016/2017 project being completed early, offset by grant income.
Mossburn Street Works	25,730	Additional	25,730	Additional	Reserves	Asphalt footpath in Devon Street requested by CDA.
Nightcaps Hall	-	-	14,666	Additional	Reserve	Interior painting project brought forward to be done this year.
Tuatapere Hall	26,000	Reduction	26,000	Reduction	Reserve	One project was brought forward and done in 14/15
Wallacetown Stormwater	60,000	Reduction	60,000	Reduction	Reserve	Project STO760 - Outfall improvement deleted by the CDA
Winton – Street works	8,000	Reduction	8,000	Reduction	Reserve	Project deferred as a trial is required to be undertaken of this product to remove moss and lichen before the contractor is engaged to undertake $10K of work. Trial of approx. $2K will be undertaken in April 2016. Surplus to be carried forward to 16/17 Project 804A

Council

27 April 2016

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Update on Te Anau Wastewater Peer Review Process

Record No: R/16/4/5071

Author: Ian Evans, Strategic Manager Water and Waste

Approved by: Ian Marshall, Group Manager Services and Assets

☒ Decision ☐ Recommendation ☐ Information

Purpose

1 To provide an update to Council on the progress made to advance the Te Anau Wastewater Discharge Project given the findings contained in the draft PDP peer review and draft addendum (both attached), and seek a decision as to whether Council wishes to defend the appeal to the Environment Court in regard to the Kepler option.

Executive Summary

2 Pattle Delamore Partners (PDP) were engaged to undertake a peer review of the current consented option for the Te Anau Wastewater Discharge Project. The Committee was briefed on the findings in the draft PDP report (Attachment A) at a two day workshop held on 9 and 10 February where it was agreed that a number of alternatives warranted further desktop investigation to determine if further physical investigation works should be progressed.

3 The outcome of this further work is presented as Addendum 1 (Attachment B) which makes recommendations around the potential alternatives. In brief the report identified treatment at the oxidation ponds with pumping to the Smith block as the most suitable alternative to compare against the consented Kepler option.

4 The assessments included in this report also need to be considered alongside legal and planning advice which recommends that the Council should not abandon the current Kepler option until it has a similar level of certainty in relation to any alternative option that it may wish to consider.

5 Given the need for the Council to indicate to the Environment Court by 27 May 2016 whether it wishes to continue with the consented Kepler option it is important that the Council make a decision on whether it wishes to defend the appeal at its meeting on 27 April 2016. The Project Committee have recommended that Council should defend the appeal but in parallel enter discussions with the appellants to explore potential areas of agreement. A draft copy of the proposed response to the Environment Court outlining how Council proposes to progress the appeal is attached (Attachment C).

6 The Committee also want to continue with its consideration of alternative options and are seeking approval for $50k of unbudgeted expenditure to enable this work to continue.

Recommendation

That the Council:

a) Receives the report titled “Update on Te Anau Wastewater Peer Review Process” dated 14 April 2016.

b) Determines that this matter or decision be recognised as not significant in terms of Section 76 of the Local Government Act 2002.

d) Approves the $261,377.82 of unbudgeted expenditure incurred as a result of undertaking the peer review.

e) Determines that it wishes to pursue the Kepler resource consent and therefore will be defending the appeals before the Environment Court if no prior agreement is reached with the appellants.

f) Notes the content of the draft Memorandum to the Environment Court and delegates authority to the Chief Executive to finalise the Memorandum, have it filed with the Environment Court and otherwise manage the defence of Council’s position through any mediation and/or Environment Court hearing process.

g) Delegates authority to the Chief Executive to enter into discussions with Fiordland Sewage Options and other appellants to the Kepler resource consent to explore the areas of common interest prior to a formal Environment Court mediation process.

h) Approves unbudgeted expenditure of $50,000 to enable the Te Anau Wastewater Discharge Project Committee to carry out further investigation of potential alternatives.

i) Requests that the Te Anau Wastewater Discharge Project Committee report back to Council by the meeting scheduled for 20 July 2016 with a progress report on the outcomes of its work and a suggested way forward.

Content

Background

7 Pattle Delamore Partners (PDP) were engaged to undertake a peer review of the current consented proposal for the Te Anau Wastewater Discharge Project. The peer review was intended to provide an independent assessment of the consented option relative to any other reasonably practicable alternatives and to provide the starting point for the development of the business case to Council for undertaking the project.

8 The consented option involves removing the current discharge from the Upukerora River and pumping, via a newly constructed pipeline, the treated wastewater to a land treatment/disposal site north of Te Anau Airport Manapouri, and is similar in nature to a number of other wastewater schemes across the country. Consent for this proposal was granted by independent commissioners in January 2015.

9 PDP has presented its draft report which confirms that the consented Kepler option is viable and does not identify any ‘fatal flaws’. This assessment is consistent with the Commissioners’ decision that the effects of the discharge on the receiving environment would be less than minor.

10 The draft report also identified two other sites that potentially have a lower 25 year net present value when compared to the consented option. PDP noted, however, that there was a need for further discussion with the Project Committee to determine whether the differences were sufficient to warrant further investigation given that they could be viewed as not significant over a 25 year period.

11 It is important to recognise that PDP’s findings are based on a ‘desktop study’ and that at some point serious consideration of any alternative would require significant physical investigation work and subsequent consent application. As such the risk profile for exploring an alternative is different to the risk profile associated with the Kepler option.

12 The Committee is still considering the findings of the PDP peer review work and are seeking approval for additional funding to enable this consideration to continue. At their meeting on 4 April the Committee resolved to recommend continuing with the current appeal process while also undertaking further work to understand and further develop potential alternatives.

13 Following further technical consideration, which is outlined in the Addendum 1 report attached one of the options identified by PDP (the Slee option) is considered as being a high risk option and therefore should not be the subject of further investigation. PDP do, however, propose that should the Committee be of the view that further investigations should be undertaken into an alternative option then those investigations should be undertaken in relation to the Smith block option (Smith option).

14 The Committee have not accepted the PDP recommendations at this stage. Instead they would like to undertake visits to other wastewater treatment plant sites before giving further consideration to the PDP recommendations.

15 Proposals for a modified Kepler option are provided for information at this stage and will be considered further through the mediation process as the appeal to the current consented option is progressed.

16 Before committing to any significant expenditure on consideration of the Smith alternative (or any other) Council will need some surety around access to the land on which alternative might be developed both for investigation work as well as commitments around long term ownership of or access to the property(s) should the Council decide to proceed further. This is best managed through a Memorandum of Understanding (or similar) negotiated with the landowner(s). It is important that the Council have a level of certainty around its ability to access the property(s) before it makes a significant investment in further investigations. No work would be undertaken until a suitable agreement is able to be negotiated.

Issues

17 The Environment Court has directed that the Council is to elect by no later than 27 May 2016 whether it wishes to pursue the Kepler block resource consent application before the Court. It is appropriate that the Committee should make a recommendation to Council in relation to how it should respond to this direction from the Court.

18 The Project Committee is also seeking approval for additional unbudgeted expenditure to enable it to continue to consider the findings of the PDP peer review and undertake site visits to other wastewater schemes around NZ.

Factors to Consider

Legal and Statutory Requirements

19 There are a number of provisions in both the Local Government Act 2002 and the Resource Management Act 1991 that need to be considered.

20 In relation to the Local Government Act 2002 (LGA) it is noted that all Council decisions are subject to the decision-making provisions detailed in Part 6 of the Act. In broad terms these provisions require that the Council assess the advantages and disadvantages of each reasonably practicable option. The extent of consideration given should have regard to the level of significance of the proposed decision.

21 Under section 10 of the LGA the purpose of local government is described as including meeting the needs of communities for “good quality” local infrastructure. Good quality is defined as meaning infrastructure and services that are efficient, effective and appropriate to present and future circumstances. Under section 14 local authorities are required to operate in a prudent and business-like manner.

22 In relation to the Resource Management Act 1991 it is noted that the Kepler Block disposal site has been granted all necessary resource consents, and designated for treated wastewater disposal by a panel of independent Commissioners. These consents (but not the designation) are subject to an appeal to the Environment Court. To confirm the consents, an agreement needs to be reached with the Appellants, or failing agreement, the Court needs to confirm the grant of consent following a hearing.

23 The advice that has been received from legal counsel is that the Council should not surrender the Kepler consents, until it has in place, and beyond challenge, the consents needed for any alternative scheme that it may choose to pursue.

24 It is noted that it will not be possible, by 27 May 2016, for the Council to have investigated any alternative disposal scheme in detail let alone seek consent for such an alternative. Given the advice received from counsel it is therefore recommended that the Council indicate to the Environment Court that it wishes to pursue the Kepler consents.

25 A draft legal response back to the Environment Court has been prepared and is included as Attachment C. This indicates that Council are willing to enter into Court appointed mediation and sets out a timeline for exchange of evidence should the mediation process not be successful.

26 During any mediation process the alternative Kepler options identified in the PDP report can be discussed with the appellants. If an agreement cannot be reached, evidence will then need to be finalised and a hearing held. Realistically, to get through the Environment Court process is expected to take a year.

27 If the consents are confirmed by the Court, this does not commit the Council to constructing the Kepler Scheme. Rather it gives Council the right to do so which does not have to be exercised. Alternatives can continue to be considered if that is the wish of the Council.

28 When considering alternative options it is important to remember that they must demonstrate the same level of minimal environmental effect as demonstrated through the consent for the Kepler proposal. Counsel has also advised that any alternative consent application carries the same level of risk of being appealed.

Community Views

29 Under Section 78 of the Local Government Act 2002 the Council is required to consider the range of community views that might exist in making any decisions.

30 It is clear that there are a number within the Te Anau and Manapouri communities who are concerned about the current Kepler consented option. The Fiordland Sewage Options Group (FSO) has made it clear that it will actively challenge the Kepler consented option.

31 As part of the resource consent process, FSO and others have raised a number of environmental concerns about the Kepler proposal. It is reasonable for the Council to assume that the environmental issues will be appropriately assessed by the Environment Court.

32 Given that the wastewater activity is treated as a district wide activity, and funded accordingly, it is appropriate that the Council also consider the views of other wastewater users and district wide ratepayers in general as they are also required to fund the costs and risks associated with the options chosen by the Council.

33 It is reasonable to expect that, in addition to appropriately addressing, the environment impacts of any proposal, there will be ratepayers who also expect the Council to manage the financial aspects of the project in a prudent and cautious way. Hence, the Council should not, for example, write off the historical investment that has been made in getting to the current point without good reason and should be conscious of the financial costs and risks associated with pursuing an alternative option.

Costs and Funding

34 To date costs associated with the PDP peer review stand at close to $250K. As this is essentially unbudgeted expenditure it requires approval by Council. The Committee are also seeking approval for an additional $50K to enable it to continue to assess the PDP recommendations and consider whether it should recommend formal investigation of an alternative to the Kepler scheme. As part of these deliberations the Committee have indicated a desire to visit a number of other wastewater schemes to develop a more comprehensive understanding of alternatives and how they are managed.

35 It is important to remember that all work on potential alternatives to Kepler undertaken to date has been desktop work. To more fully understand the impact of environmental effects it will be necessary to undertake extensive investigation work, particularly if it is to be used as part of a future resource consent process. The $50K requested by the Committee would not cover the cost of any alternative option(s) investigation work. At best it would allow for a scoping of the investigation works that might be needed. Undertaking any investigation works will need to be subject to a further unbudgeted expenditure request from Council. Any such expenditure will need to be treated as an operational expense and funded accordingly.

36 Since July 2013, approximately $1.3 million has been spent through the investigation and consenting stages of the project on the Kepler option. There is an estimated $300K further expense required through the appeal process. These costs are currently being treated as a capital expense.

In order to control costs it is preferable to limit the number of options that are put forward for further investigation. If it is eventually asked by the Committee to make a decision on funding investigations for an alternative option Council will need to be satisfied that the costs and benefits (including risks) of pursuing an alternative outweigh the costs and benefits of pursuing the Kepler option. While the Net Present Value assessment included in the draft PDP report contains some level of assessment it has not been subjected to a comprehensive risk assessment process. It would seem appropriate for this work to be undertaken as part of the next phase of work.

Policy Implications

37 The longer the consenting process takes, the greater the chance becomes that any new consents will be assessed against new policies and rules. In particular, the National Policy Statement for Freshwater Management 2014 ("NPS") requires Environment Southland to develop freshwater quality limits, and impose conditions to meet these. There is currently uncertainty about when those limits will be finalised, and what they will be via the Water and Land 2020 process.

38 The preference for wastewater to be discharged to land rather than water is a well-known concept within the region. It arises in the operative Regional Policy Statement (RPS) in Policy 5.4, and is duplicated in the proposed RPS at Policy WQUAL.7. In both the operative and proposed RPS, the preference is to be used when discharge to land is practicable, and when the adverse effects are not significant.

39 Council has shown that it is practicable to discharge to land in the Kepler Block scheme, and in its decision to grant resource consent, the Commissioners stated that the proposal would be well within the significant adverse effect threshold under the operative RPS. The key environmental outcome of the proposal is that the discharge is to land, and not to the Upukerora River, which better meets stakeholder expectations and environmental preferences, as identified in both the RPS mentioned above, as well as in the NPS.
Any alternative option would also need to meet these criteria.

40 The District Plan provisions will also apply to any new consent application with that alternative requiring either a land use consent or a designation as is currently in place at Kepler. This would likely require notification and a hearing.

41 The decision on the notification path (ie non/limited/publically notified) will depend on the likely level of effects and whether they extend beyond the broadly adjoining properties.
For example, disposal adjacent to an urban boundary is more likely to be considered as needing to be publically notified whereas the sites further away from the urban boundary would potentially be subject to limited notification.

42 Setbacks outlined in the current and proposed plan will apply around the designation which could further restrict site selection and available land for future expansion, with it being unlikely that these could be reduced by way of consent conditions.

Analysis

Options Considered

43 There are three options identified. These are to continue with the current consented option at the Kepler (Option 1), to abandon the Kepler option and pursue an alternative (Option 2) or a Hybrid option (Option 3).

44 Under Option 1 the Council would defend the appeal against the Kepler consented option through the Environment Court process and then make a decision on how it moved forward following receipt of a Court decision. It would not investigate any alternative options in the interim.

45 Under Option 2 the Council would abandon the current Kepler consent process and pursue an alternative site.

46 Under Option 3 the Council would continue to pursue the Kepler consent while undertaking investigations into a possible alternative site. The costs associated with the alternative investigations would need to be treated as an operational expense and funded accordingly.

Analysis of Options

Option 1 - Continue with current consented option

Advantages

Disadvantages

· Time and cost of future investigations will not be incurred.

· Subject to outcome of the appeal the Council will have long term certainty on future wastewater discharges.

· The costs of the appeal process will continue to be capitalised.

· Consenting process already well advanced and designation is in place.

· Is consistent with the adopted Long Term Plan.

· Peer review has not identified any fundamental flaws with the consented proposal.

· Further opposition likely through Environment Court process.

· Risk that it might not constitute the least cost option.

Option 2 - Abandon the consent and restart a new consenting process

Advantages

Disadvantages

· Likely to be popular with appellants.

· Provides clarification into suitability of an alternative land within the Te Anau Basin.

· Goes against legal advice.

· Introduces significant uncertainty around getting a consent at an alternative site.

· There is risk of an alternative being appealed as with the Kepler proposal.

· Alternative site may not prove to be viable or as having more advantages than the Kepler option.

· All costs to date would have to be written off and funded from rates.

· Costs associated with this investigation will be written off if no suitable site is identified or if full NPV costs are greater than Kepler.

· Consenting process will need to start from scratch with associated costs and risks not yet understood.

· Likely that it would not be seen as financially prudent and business like and therefore in breach of the Local Government Act 2002.

· Risk that the Council may incur a loss under section 44 of the Local Government Act if the decisions were to be subsequently set aside.

Option 3 - Hybrid of both above options whereby any investigations would run in parallel with the appeal process

Advantages

Disadvantages

· Provides greater certainty and reduces risks by ensuring that alternative investigations continue while pursuing consent for Kepler option.

· Consenting process already well advanced and designation in place.

· A modified Kepler option (if acceptable to all parties) could be progressed without having to vary the consent.

· Council would still have option of pursuing an alternative scheme even if consent for Kepler option is confirmed.

· Costs of investigation of alternative will need to be treated as operational expense and funded accordingly.

· Risk that a suitable alternative may not be found.

· Risk that any alternative investigated option will also be appealed.

· Council will be incurring costs for pursuing two options at once. It could be argued that the financially prudent approach would have been to pursue alternative once it is known whether Kepler consent is confirmed.

Assessment of Significance

47 Any decision to abandon the current Kepler consented option would require the write off of the significant expenditure incurred by Council to date. This includes some $1.3 million of expenditure currently held on the balance sheet for investigations since 2013.
This expenditure would need to be written off and funded. In addition the Council would effectively be writing off the investment in the work completed prior to 2010 that have previously been funded. The quantum of this write off would exceed the financial threshold for unbudgeted expenditure in the Significance and Engagement Policy.

48 Officers are of the view that a decision to abandon the Kepler consent either now, or at some stage in the future, would constitute a significant decision. As such there would be a reasonably strong argument that the Council should consult on any such proposal particularly given the financial consequences and change in policy that such a decision would represent.

49 A decision to continue with the current consented option (Option 1) would be consistent with the direction that the Council has been pursuing for a number of years and with the Council’s adopted 2015 Long Term Plan. Hence, officers are of the view that a decision to adopt this option would not be significant.

50 The hybrid option (Option 3) would represent a continuation of the current option while also developing an understanding of the costs associated with investigating the Smith option alternative.

51 If the investigation costs of exploring any alternative are expected to exceed $500,000 then this would breach the unbudgeted expenditure threshold in the Significance and Engagement Policy. As such a decision to commit to such expenditure, particularly while continuing with the Kepler option would likely constitute a significant decision.

52 Council is not, however, being asked to recommend the incurrence of such a level of investigation works at this stage. This is a decision that will need to be made, following consideration of a future report, once the Project Committee have determined the range of alternative options that they propose the Council should investigate. At this stage the Committee are simply seeking additional funding to support their ongoing consideration of the PDP peer review report in relation to the potential investigation of alternative options. Once the Committee has made a decision on which alternative option(s) it wants to investigate it will need to have these works scoped and then seek approval from Council for such investigations and the associated expenditure. As a result it is seen as reasonable to conclude that adoption of Option 3 would not constitute a significant decision at this stage.

Recommended Option

53 Option 3 is the recommended option. It enables the Council to continue with pursuing consent for the Kepler option while allowing the Project Committee to continue with its consideration of the PDP peer review to enable it to determine whether it wishes to recommend investigation of an alternative option(s).

Next Steps

54 The next steps will include:

· Finalisation and filing of the Memorandum to the Environment Court indicating that Council wishes to pursue its consent for the Kepler option.

· Commence discussions with FSO and the appellants to the Kepler option to explore potential areas of common ground.

· The Project Committee would visit other wastewater schemes around NZ to enable it to consider a range of possible alternative schemes and further consider the draft PDP peer review report.

· The Project Committee would bring a recommendation on any proposed investigation programme back to Council for approval.

Attachments

a Draft - Review of Te Anau Wastewater Treatment and Disposal Options View

b Response from Pattle Delamore - Comments on review of Te Anau Wastewater Treatment and Disposal Options Addendum 1: Additional Options View

c Memorandum of Counsel for Southland District Council before the Environment Court View

Council

27 April 2016

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Approval of Unbudgeted Expenditure for the Oban Wastewater Oxidation Pond

Record No: R/16/3/3704

Author: Ian Evans, Strategic Manager Water and Waste

Approved by: Ian Marshall, GM - Services and Assets

☒ Decision ☐ Recommendation ☐ Information

Purpose

1 To seek Council’s approval to spend $55,000 plus GST, unbudgeted expenditure to fund the upgrade aeration equipment for the Oban wastewater oxidation pond.

Executive Summary

2 The influx of cruise ship visitors to Oban has recently caused significant operational problems at the township’s wastewater oxidation ponds.

3 To manage the additional load as a result of high visitors it is proposed to install a new, more efficient aerator on the pond at a cost of $55,000 plus GST. As this expenditure is un-budgeted it requires Council approval.

4 Given that the expenditure is required as a result of increasing demand over the holiday period it is appropriate that the project is funded from the development contribution reserve which currently has $264,045 available.

Recommendation

That the Council:

a) Receives the report titled “Approval of Unbudgeted Expenditure for the Oban Wastewater Oxidation Pond” dated 19 April 2016.

b) Determines that this matter or decision be recognised as not significant in terms of Section 76 of the Local Government Act 2002.

d) Approves the request to spend an unbudgeted amount of $55,000 on the upgrade of the aeration to the Oban wastewater oxidation pond to be funded from Development Contributions.

Content

Background

5 Increased visitor numbers from the larger cruise ships stopping at Stewart Island have recently been causing operational issues at the Oban township wastewater oxidation pond site.

6 In February 2016 the pond almost turned over as a result of reduced Dissolved Oxygen (DO) caused by an increase in load from the number of visitors to the township. In response to the issue Downer brought an additional aerator over to the pond to try to stabilise the ponds through the remainder of the season.

7 While this action was successful it has resulted in an almost doubling of the site power bill for February. Given that this is likely to become an annual issue Water and Waste officers are recommending the replacement of both aerators with a single more energy efficient diffused air aerator which will provide sufficient aeration at less than the running costs of the current set up. The aerator is similar to one installed in the Winton pond last year and which is working well.

8 As this is essentially unbudgeted expenditure it requires Council approval, however as it is proposed to fund through Development Contributions collected for such increases in demand there will be no impact on rates.

Issues

9 The main issue identified is the risk to compliance with resource consent conditions over the tourist season.

Factors to Consider

Legal and Statutory Requirements

10 The report will deal with the legal requirement of obtaining approval for this additional expenditure.

Community Views

11 None identified at this stage.

Costs and Funding

12 This is currently unbudgeted expenditure hence requiring Council approval.

13 The value of the project is for $55,000 plus GST to be funded from Development Contributions.

14 The Oban Development Contributions Reserve has $264,045 as of 30 June 2015.

15 Estimated monthly power costs for the proposed new aerator are $1,250 whereas current power costs for the two aerators currently in place are $2,300 providing a payback within five years.

Policy Implications

16 None identified at this stage.

Analysis

Options Considered

17 Either approve or not the unbudgeted expenditure.

Analysis of Options

Option 1 - Approve expenditure

Advantages

Disadvantages

· Project can commence subject to Council approval.

· Long term savings in electricity.

· None identified.

Option 2 - Do not approve expenditure

Advantages

Disadvantages

· None identified.

· Risk no non-compliance with resource consent issues.

· Ongoing high electricity costs.

Assessment of Significance

18 Not considered significant.

Recommended Option

19 It is recommended that that the project is approved and that expenditure is funded from the Oban Development Contribution Reserve.

Next Steps

20 Commence project.

Attachments

There are no attachments for this report.

Council

27 April 2016

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Approval of Unbudgeted Expenditure by the Te Anau Community Board for the Joint Public BBQ Project with the Te Anau Kepler Lions Club

Record No: R/16/3/3585

Author: Nick Lewis, Community Engineer

Approved by: Ian Marshall, GM - Services and Assets

☒ Decision ☐ Recommendation ☐ Information

Purpose

1 To seek Council’s approval to spend $11,439, excluding GST, unbudgeted expenditure to fund the purchase of a public BBQ unit for joint project with Te Anau Kepler Lions Club.

Executive Summary

2 The Te Anau Kepler Lions Club have been in discussions with the Te Anau Community Engineer and Venture Southland Community Development Planner to provide another public BBQ at Lions Park. The Te Anau Community board were advised the total project cost, as per quotes received by the Kepler Lions, to be approx. $24,000.00 including GST

3 The Kepler Lions have approached the Te Anau Community Board for assistance in funding for the BBQ unit component of this project. The Te Anau Community Board has not budgeted to spend any money on this project.

4 The Board has requested approval to spend $11,439, excluding GST, to be funded from the Board’s general reserve.

Recommendation

That the Council:

a) Receives the report titled “Approval of Unbudgeted Expenditure by the Te Anau Community Board for the Joint Public BBQ Project with the Te Anau Kepler Lions Club” dated 19 April 2016.

b) Determines that this matter or decision be recognised as not significant in terms of Section 76 of the Local Government Act 2002.

d) Approves the request of the Te Anau Community Board for approval of unbudgeted amount of $11,439, excluding GST, to be funded from the Board’s general reserve as the Board’s share of a joint public BBQ project with the Te Anau Kepler Lions Club.

Content

Background

5 The Te Anau Kepler Lions Club have been in discussions with the Te Anau Community Engineer and Venture Southland Community Development Planner to provide another public BBQ at Lions Park, as per the existing public BBQ installed at the Te Anau Lakefront area, adjacent the Te Anau Boat Club mariner. The Kepler Lions have approached the Te Anau Community Board for assistance in funding for the BBQ unit component of this project.

6 The Te Anau Community Board had assisted for the similar past project with the Fiordland Rotary Club by purchasing a two cooktop BBQ unit, the remainder of the project saw Rotary construct and install the unit, shelter and electrical connection. This past unit was costed at $10,987, excluding GST, and was installed prior to Christmas 2014. This facility is located adjacent to the boat harbour on the Te Anau Lakefront and has been very well utilised by both the local community and visitors alike.

7 Approval is sought to spend this unbudgeted amount of $11,439, excluding GST, to be funded from the Board’s general reserve account.

Issues

8 The only issue identified is that of unbudgeted expenditure which this report is seeking to resolve.

Factors to Consider

Legal and Statutory Requirements

9 None identified.

Community Views

10 The Te Anau Community Board at its December 2015 meeting resolved to contribute to this project based on the estimated total cost of $11,439, excluding GST.

11 This project is by a local community group, the Te Anau Kepler Lions Club.

Costs and Funding

12 The Te Anau Community Board at its December 2015 meeting resolved to contribute to this project based on the estimated total cost of $11,439, excluding GST, to be funded from the Board’s general reserves, being the BBQ unit component.

13 The Te Anau Community board were advised the total project cost, as per quotes received by the Kepler Lions, to be approx. $24,000.00 including GST (the group is not GST registered). Report R/15/11/21210.

14 This joint public BBQ projects construction and installation costs are the responsibility of the Kepler Lions Club, which they have gained funding for. The Te Anau Community Board provided written support for the Kepler Lions Club’s own funding applications. Ownership of the BBQ unit and shelter will remain that of Council.

15 The Board has previously resolved to commit funds towards installation of water connection to the proposed site for water supply tap and/or fountain and the ongoing operational/ maintenance costs under the Parks & Reserves General Budget, being electricity through the existing Electricity Budget and maintenance through Maint – Equipment Budget. Electricity budgets will be adjusted once usage figures are evaluated. As per the Boat Harbour BBQ it is user responsibility for cleaning with the Kepler Lions Club monitoring and cleaning as required.

16 The Te Anau Community Board’s general reserve currently has a budget of $325,433, with forecast budget of $222,035.

Policy Implications

17 None identified at this stage.

Analysis

Options Considered

18 Either approve or not the unbudgeted expenditure.

Analysis of Options

Option 1 - Approve expenditure.

Advantages

Disadvantages

· Project can commence subject to APAC approval to accept tender.

· A community lead initiative providing a new asset can be provided.

· None identified.

Option 2 - Do not approve expenditure.

Advantages

Disadvantages

· None identified.

· Project delayed or cancelled.

· A community lead initiative providing a new asset not being provided.

Assessment of Significance

19 Not considered significant.

Recommended Option

20 Approve expenditure.

Next Steps

21 If expenditure is approved, arrange for purchase of the BBQ unit and notify Kepler Lions Club of ETA for unit, Kepler Lions Club to proceed with remainder of the construction and installation parts of the project. If not approved, notify the Te Anau Kepler Lions Club of decision.

Attachments

There are no attachments for this report.

Council

27 April 2016

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Elected Members Remuneration

Record No: R/16/4/4877

Author: Sheree Marrah, Finance Manager

Approved by: Anne Robson, Chief Financial Officer

☒ Decision ☐ Recommendation ☐ Information

Purpose

1 The purpose of this report is to establish the levels of Elected Members remuneration for the period 1 July 2016 to 30 June 2017 in accordance with the requirements of the Remuneration Authority.

Executive Summary

2 The Remuneration Authority (RA) is currently seeking confirmation on the proposed remuneration for Elected Members for the period 1 July 2016 to 30 June 2017.

3 The RA calculates the level of remuneration for the Mayor, Councillors and Community Board members. The approach used is consistent with the outcome of the 2013 Elected Members Remuneration review, subject to a few minor changes. The calculation of the Mayor and Councillor salaries is determined from a model which is intended to reflect a number of factors including the size and complexity of a local authority.

4 The RA are proposing a base remuneration level increase for inflation, of between 1.5% to 3.0% depending on the Authority’s size index. The proposed inflation applied to Council’s remuneration is 2.5%.

5 The RA also allocates a pool of funds for disbursement to Elected Members for additional duties. This pool has been increased from 150% of the Councillor’s base salary to 200% ($51,455). The RA has also removed the caps on payments to individual councillors for additional duties.

6 Council are required to endorse the proposed base salaries and advise of the allocation of the pool to the various positions of additional duties to the RA by 16 May 2016. Once the RA has considered information from all councils a formal determination will be issued.

Recommendation

That the Council:

a) Receives the report titled “Elected Members Remuneration” dated 19 April 2016.

b) Determines that this matter or decision be recognised as not significant in terms of Section 76 of the Local Government Act 2002.

d) Adopts to recommend Option 1 of this report to the Remuneration Authority for proposed Elected Members remuneration for the period 1 July 2016 to 30 June 2017, being:

• Accept inflation rate increase from 2015/16 of 2.5% on all remuneration.

• Allocate 150% of the pool for additional responsibilities (rather than the maximum allowed of 200%).

• Allocate the pool for additional responsibilities as follows:

- Deputy Mayor (40%).

- Policy Committee Chair (20%).

- Venture Southland Director (15%).

- Activities Performance Audit Committee Chair (25%).

- Available for Councillors contributing to the development of the District Plan (50%).

e) Requests that staff provide the necessary information to the Remuneration Authority by the required date.

f) Requests that staff provide a report for information to all Community Boards of the proposed remuneration for the period 1 July 2016 to 30 June 2017.

Content

Background

7 The RA sets the framework for the remuneration and reimbursement of local government Elected Members. This includes:

· The Mayor;

· The Deputy Mayor;

· Councillors;

· Community Board members; and

· Chairpersons Council Committees, and

· Chairpersons Community Boards.

The current approach for 2015/2016

8 In 2013 the RA, in consultation with representatives of local government, completed a major review of the way in which remuneration is set for Elected Members of local authorities.
The revised approach was based on job evaluation and an assessment of the hours involved in undertaking governance and representation functions. This approach has the following features:

a) The RA sets base salaries for Elected Members of regional and territorial authorities, and for Community Boards.

b) A pool will be available to each council to provide additional remuneration for members who take on additional responsibilities, such as filling the role of Deputy Mayor or chairing a Committee of Council. The amount of money in this pool will be capped at the equivalent of 150% of the base councillor salary.

c) A measure of the relative size and complexity of each Council’s business activities, called the ‘size index’, has been developed.

d) Salaries of Mayors and Chairpersons of regional councils are based on the size index for the Council.

e) A base Councillor salary is set for each Council, based on the size index for the Council.

f) Salaries for Councillors with additional responsibilities are set based on representations from councils, with a cap on total additional salary cost per council expressed as a multiple of the Council’s base Councillor salary.

g) Community Board Elected Members’ salaries are based on the population base for the community.

h) Every three years the Authority will review the process for setting size indices, and the relationships between size indices and remuneration.

i) Every year the Authority will recalculate size indices, which will determine any appropriate general increase in salaries as a result of CPI changes, and determine remuneration based on the relationships developed at the previous triennial review. No base Councillor remuneration will decrease as a result of this recalculation.

j) Levels of remuneration could be reviewed if significant change to legislation affecting the role and responsibilities of local government elected representatives occurred.

The approach for 2016/2017

9 The RA has requested confirmation of Elected Members remuneration for the period 1 July 2016 to 30 June 2017. The approach is consistent with that applied in 2013, other than the following changes:

10 The RA are proposing that Southland District Council base salaries increase by 2.5% from 2015/2016. The base remuneration levels for Elected Members are as follows:

Role	2015/2016 Base Remuneration	2016/2017 Proposed Base Remuneration
Mayor	$105,900	$108, 548
Councillor	$25,100	$25,728

Community Board	2015/2016 Remuneration (Chairperson)	2016/2017 Proposed Remuneration (Chairperson)	2015/2016 Remuneration (Member)	2016/2017 Proposed Remuneration (Member)
Stewart Island/Rakiura	$2,600	$2,665	$1,300	$1,333
Wallacetown	$2,600	$2,665	$1,300	$1,333
Otautau	$7,000	$7,175	$3,500	$3,588
Riverton/Aparima	$6,200	$6,355	$3,100	$3,178
Tuatapere	$4,200	$4,305	$2,100	$2,153
Edendale-Wyndham	$4,400	$4,510	$2,200	$2,255
Winton	$8,600	$8,815	$4,300	$4,408
Te Anau	$10,000	$10,250	$5,000	$5,125

11 The amount available to supplement base remuneration for Councillors with additional responsibilities has increased from 150% of base Councillor remuneration to 200%. Therefore the maximum amount available to allocate for additional responsibilities in 2016/2017 is $51,455.

12 The caps on individual Councillors for additional duties have been removed. Previously these caps were 40% for Deputy Mayor and 25% for other positions.

Remuneration of Councillors for additional responsibilities

13 As noted above the RA’s model for remuneration proposes that up to an additional 200% of the base remuneration for a Councillor be available to remunerate the deputy mayor, chairs of committees and portfolio holders, eg Venture Southland, for additional responsibilities.

14 The RA is seeking feedback from Council on how the pool of 200% for additional responsibilities for these positions should be allocated. Feedback provided to the RA will be used by them to inform the allocation of additional funds to the total remuneration pool and accordingly set the determination. Some of the additional amount is able to be retained for allocation during the development of District Plans.

15 Currently Southland District Council has allocated the additional remuneration of 150% of a base councillor salary as follows:

Role	2015/2016 Base Remuneration Uplift
Deputy Mayor	40%
Policy Committee Chair	20%
Venture Southland Director	15%
Activities Performance Audit Committee Chair	25%
Available for Councillors contributing to the development of the District Plan	50%
TOTAL	150%

16 The amount allocated for developing and adopting a District Plan is intended to recognise the additional demands on Councillor time during this period.

Issues

17 The key issue is the allocation of the additional funds available to the various Councillors with additional responsibilities. There is an additional 50% of a base salary available for distribution ($12,863), bringing the total pool available to those with additional responsibilities to $51,455.

18 Below are three potential options for distribution of the pool for those with additional responsibilities:

• Option A - No change to the pool allocation from 2015/2016. Council decides not to use the additional 50% available this year, staying with the current uplift of 150%.

• Option B - Allocate the 200% on a pro-rata basis consistent with the 2015/2016 allocation.

• Option C - Allocate the 175% on a pro-rata basis consistent with the 2015/2016 allocation. This means that half of the additional 50% available this year would not be applied to Councillors.

Role	2015/2016 Base Remuneration Uplift	2016/2017 Base Remuneration Uplift (Option A)	2016/2017 Base Remuneration Uplift (Option B)	2016/2017 Base Remuneration Uplift (Option C)
Deputy Mayor	40%	40%	53%	47%
Policy Committee chair	20%	20%	27%	23%
Venture Southland director	15%	15%	20%	18%
Activities Performance Audit Committee chair	25%	25%	33%	29%
Available for Councillors contributing to the development of the District Plan	50%	50%	67%	58%
TOTAL	150%	150%	200%	175%

Please note, in the instance that the Council committee structure changes subsequent to the October 2016 elections, Council will be required to submit an amended elected members remuneration proposal to the RA for consideration and once approved an amended determination will be released.

Factors to Consider

Legal and Statutory Requirements

19 There are no legal considerations relevant to this issue.

Community Views

20 There are no requirements to consult with the community in respect of this issue.
The position of the Southland District Council in relation to this issue is unlikely to impact on the perception of public value, as payments received by Elected Members of Southland District Council and Community Boards are not high in terms of the national range.

Costs and Funding

21 Due to a timing difference in when the 10 Year Plan was adopted and the Elected Members Determination being issued for 2015/2016, there is currently a shortfall in Council’s budget for Elected Members of $55,043. This shortfall has therefore carried forward into the 2016/2017 budget. The 2016/2017 Annual Plan currently reflects a budget of $563,013 for all Elected Members. The proposed options would require funds of $619,481 (Option 1), $632,346 (Option 2), or $625,912 (Option 3). How this increase would be funded needs to be discussed and agreed. Options include an increase to rates, pay from possible operational savings, funding from reserves or a mixture of these options.

Policy Implications

22 The RA will publish a determination following the receipt of information from local authorities. This determination will create a need for changes to Council’s Elected Members Remuneration and Reimbursement Policy. An approved policy will be provided to the RA in due course.

23 Changes to this policy will reflect amendments to remuneration rates. Communications allowances, travel time payments and mileage rates will remain unchanged.

24 We note that in the instance Council’s committee structure changed, a proposal would need to be provided to the RA to amend the Elected Members Remuneration determination to align with the revised structure.

Analysis

Options Considered

25 If Council does not provide information to the RA, it will not be able to influence the allocation of remuneration. We also note that it is an election year and higher remuneration levels may assist in attracting new/more electoral candidates.

26 It is therefore recommended that Council respond to the RA acknowledging the 2.5% base rate increase and advising of the desired allocation of additional responsibilities of Committee chairs and portfolio holders.

Analysis of Options

27 Option 1 - Accept the base salaries as proposed for all Elected Members and retain the allocations for additional responsibilities consistent with the current year (totalling 150% of base Councillor salary) ($15,156 increase from 2015/2016 budget)

Advantages

Disadvantages

· Lesser impact on the ratepayer if funding from rates.

· Consistent salary increase across all Elected Members.

· Full pool available for allocation is not used.

· Councillors are not uplifting the additional allowance and accordingly remuneration may fall behind other local authorities.

28 Option 2 - Accept the base salaries as proposed for all Elected Members and increase the Elected Member allocations for additional responsibilities on a pro-rata basis consistent with the current year (totalling 200% of base Councillor salary) ($28,021 increase from 2015/2016 budget)

Advantages

Disadvantages

· Full utilisation of the pool available for allocation.

· Higher remuneration rates for Councillors with additional responsibilities.

· Bigger impact on the ratepayer.

· Significant increase in salaries in one financial year for those with additional responsibilities.

29 Option 3 - Accept the base salaries as proposed for all Elected Members and increase the Elected Member allocations for additional responsibilities on a pro-rata basis consistent with the current year (totalling 175% of base Councillor salary) ($21,587 increase from 2015/2016 budget)

Advantages

Disadvantages

· 50% utilisation of the pool available for allocation.

· Higher remuneration rates for Councillors with additional responsibilities.

· Gradual increase in salary over two years/two pay review periods.

· Impact on the ratepayer.

· Increase in salaries in two or more financial years for those with additional responsibilities.

· Councillors are not uplifting the full additional allowance and accordingly remuneration may fall behind other local authorities.

The financial impact of each of these options are outlined in Attachment 2 of this report.

Assessment of Significance

30 This matter is not considered significant as it is a routine operational matter.

Recommended Option

Option 1 - Accept the base salaries as proposed for all Elected Members and retain the allocations for additional responsibilities consistent with the current year (totalling 150% of base Councillor salary).

Next Steps

31 Staff to provide Council’s response on Elected Members remuneration and allocation of pool for additional responsibilities for 2016/2017 year to the RA by the required deadline of
16 May 2016.

32 Staff to circulate a report to all Community Boards advising them of the proposed increase in Community Board Chair and member salaries.

33 Finance staff to provide a copy of the Elected Members Determination to payroll staff to implement from 1 July 2016.

Attachments

a Letter from Remuneration Authority regarding Elected Members Remuneration from 1 July 2016 View

b Total Proposed Elected Member Remuneration for 2016/2017 View

Council

27 April 2016

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Request to Transfer Ownership of the Athol Fire Station Property to the Southern Rural Fire Authority

Record No: R/16/3/4355

Author: Kevin McNaught, Strategic Manager Property

Approved by: Ian Marshall, GM - Services and Assets

☐ Decision ☐ Recommendation ☐ Information

Purpose

1 To seek Council approval to the request from the Southern Rural Fire Authority to transfer ownership of the Athol Fire Station property from Council to the Authority.

Executive Summary

2 Council is the owner of the Athol Fire Station property. Since 2003, the Southern Rural Fire Authority has covered the costs for rates, insurance and repairs and proposes more internal renovations.

3 Officers have no issue with the request on the proviso that Council has first option to purchase should the property be disposed of in the future. This is the basis of which the Waikawa Fire Station was transferred in 2007.

Recommendation

That the Council:

a) Receives the report titled “Request to Transfer Ownership of the Athol Fire Station Property to the Southern Rural Fire Authority” dated 19 April 2016.

b) Determines that this matter or decision be recognised as not significant in terms of Section 76 of the Local Government Act 2002.

d) Resolves to transfer the Athol Fire Station property being Lot 1, DP 12002 and contained in CFR SL9A/254 to the Southern Rural Fire Authority for $1.00.

e) Resolves that the transfer be subject to a condition in the Agreement for Sale and Purchase that should the Southern Rural Fire Authority wish to sell or transfer ownership of the property, it shall be first offered back to Council for $1.00.

f) Resolves that the Agreement for Sale and Purchase be executed under Council’s seal.

Content

Background

4 In 1988 the Upper Mataura Pest Destruction Board transferred land for 10 cents to the Southland County Council for the site of the proposed Athol Fire Station.

5 While significant research has not been undertaken, it appears that the building when constructed was funded locally with some levy funds and a loan from the Council. The details are not really important at this point as the objective was to build a fire station which was achieved.

6 Since 2003 the Southern Rural Fire Authority has covered the costs for rates, insurance and repairs and proposes more internal renovations. As all operating costs are funded by Southern Rural Fire, they have requested that the ownership of the property be transferred to them.

7 There is no issue with the request as it is similar to what has happened at Waikawa in 2007. As part of that transfer, and what has been suggested here, is that the transfer happens on the basis that before Southern Rural Fire Authority sell or transfer ownership of the property, it must be first offered back to Council for $1.00.

8 What this process allows is for Council to be aware of what is happening, approve it, get the property back or negotiate some other agreement.

9 What is likely to happen with these types of properties in the amalgamation of the firefighting entities is unknown at this stage, however making it a condition of sale as opposed to registering a caveat on the title, creates a form of contract between the parties that requires some discussions to take place.

10 It is acknowledged that not having a caveat registered on the title does carry a risk in that the property could subsequently be transferred. This risk is mitigated to a degree given the contract provision and the parties involved. The costs of the registration process will exceed the value that might be gained.

Issues

11 Staff see no issues with the request, however the only unknown is what happens when the firefighting agencies are amalgamated as is currently proposed. This is not seen as an issue should the property still be required for a fire station, however if that is not the case, a decision would need to be made at that time.

Factors to Consider

Legal and Statutory Requirements

12 None identified, however the condition of sale as suggested would protect Council’s interest, provided the parties remember it is theirs as nothing is registered on the title.

Community Views

13 None canvassed, however the ownership is still aligned to its intended use, a fire station. Council’s position will be taken to represent the community.

Costs and Funding

14 No costs to Council, Southern Rural Fire can present Council with the Agreement for Sale and Purchase.

Policy Implications

15 None identified.

Analysis

Options Considered

16 Agree with the request or not.

Analysis of Options

Option 1 - Agree with the request

Advantages

Disadvantages

· Asset no longer Council’s asset or responsibility.

· Removes any financial or health and safety responsibilities.

· None identified.

Option 2 - Decline request

Advantages	Disadvantages
· Asset remains in Council ownership.	· Council retains overall financial and health and safety responsibilities for the property.

Assessment of Significance

17 Not considered significant.

Recommended Option

18 Agree with the request.

Next Steps

19 Notify Southern Rural Fire Authority so that the transfer can be arranged.

Attachments

a Transfer of Ownership - Athol Fire Station and Land - 16 Paddys Alley, Athol View

Council

27 April 2016

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Renewal of Lease of Office Space, Council's Otautau Office - Otautau and Districts Charitable Community Trust

Record No: R/16/3/4498

Author: Virginia Dillon, Property Officer

Approved by: Ian Marshall, GM - Services and Assets

☒ Decision ☐ Recommendation ☐ Information

Purpose

1 The purpose of the report is to approve the issue of a renewal lease to the Otautau and Districts Community Charitable Trust over offices at the Council’s Otautau office.

Executive Summary

2 The Otautau and Districts Community Charitable Trust lease of office space at Council’s Otautau office expires on 30 April 2016.

3 The lease makes provision for a right of renewal for a further term of two years from
1 May 2016.

Recommendation

That the Council:

a) Receives the report titled “Renewal of Lease of Office Space, Council's Otautau Office - Otautau and Districts Charitable Community Trust” dated 19 April 2016.

b) Determines that this matter or decision be recognised as not significant in terms of Section 76 of the Local Government Act 2002.

d) Determines that the Otautau and Districts Community Charitable Trust be offered a renewal lease of space at the Southland District Council office located at 176 Main Street, Otautau for a term of two years from 1 May 2016 at an annual rental of $1,250 plus GST.

Content

Background

4 The Otautau and Districts Community Charitable Trust have leased space at the Council’s Otautau office for several years.

5 The most recent lease was issued for two years from 1 May 2014.

6 The current lease expires on 30 April 2016 and contains a right of renewal for a further term of two years.

7 The annual rental is to be reviewed upon renewal.

8 In a letter dated 23 March 2016 (attached) the Trust has exercised its right of renewal and asked that the annual rental remain at $1,250 plus GST.

Issues

9 No issues identified.

There is no known reason for increasing the annual rental charged.

Factors to Consider

Legal and Statutory Requirements

10 A copy of the lease to the Trust is enclosed for the Council’s information.

Community Views

11 The views of Council are deemed to represent those of the community.

Costs and Funding

12 There are no direct costs to the Council in the lease renewal.

Policy Implications

13 No policy implications identified.

There is no current delegation to Council staff to deal with the matter – which is why it is being submitted to the Council.

Analysis

Options Considered

14 There is only one option to consider and that is to issue a renewal lease as provided for.

15 The Trust has complied with all conditions of its current lease and is, therefore, entitled to be issued with a further lease.

Analysis of Options

Option 1 - Issue of a renewal lease

Advantages	Disadvantages
· It will be in Council’s financial interests to continue to have office space at its Otautau office leased to tenants where appropriate.	· None identified.

Assessment of Significance

16 Not considered a significant activity.

Recommended Option

17 The Officer recommends that a renewal lease be issued.

Next Steps

18 The Trust will be advised of the Council’s decision and documentation will be sent for signing.

Attachments

a Part Signed - Agreement for Lease between SDC and Otautau and Districts Community Charitable Trust View

b Otautau and Districts Community Charitable Trust Lease Confirmation View

Council

27 April 2016

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Management Report

Record No: R/16/4/5169

Author: Steve Ruru, Chief Executive

Approved by: Steve Ruru, Chief Executive

☐ Decision ☐ Recommendation ☒ Information

Chief Executive

Te Anau Wastewater

1 The Te Anau Wastewater Discharge Project Committee met on 4 April 2016 to consider an Addendum 1 to Pattle Delamore Partners (PDP) draft peer review report and consider the recommendation that the Committee should make in relation to the appeal against the Kepler resource consent.

2 The draft PDP peer review report confirms that the consented Kepler option is viable and has estimated costs that are broadly in line with the projections developed by MWH. It also identified, however, two other reasonably practicable options which appear to have a net present value that is less than the Kepler option. The Addendum 1 report recommends that these two alternatives be narrowed down to one option being the Smith block option.

3 The committee did not feel they had sufficient information yet to narrow the options down to one alternative and so chose to keep other options open for consideration. Members of the committee also felt they needed to see for themselves similar treatment plants and discharge systems operating around the country. To that end they requested an itinerary be developed for the committee to visit such sites and that funding be sought from Council to enable their work to continue.

4 The committee also resolved to recommend to Council that it defend the appeal against the Kepler resource consents and enter into discussions with Fiordland Sewerage Options and other appellants to explore the areas of common interest prior to a formal Environment Court mediation process.

Local Government Reform

5 In mid-March the Minister of Local Government Minister, Hon Peseta Sam Lotu-Iiga, announced the details of his proposed Better Local Services legislative reform package.

6 Government have had concerns about the overall performance of the local government sector for some time. These concerns have also been reflected in, for example, the LGNZ Reputation Survey work. There is also widespread recognition of a number of significant strategic challenges affecting the sector including:

· Demographic changes with some areas dealing with large population growth while others are seeing a declining and/or ageing population.

· Economic shifts recognising that national, regional and sub-regional economies are more interdependent than ever before.

· Environmental pressures with rising standards and the need to ensure that local infrastructure and communities are resilient to the effects of climate change and natural disasters.

· Technological changes presenting significant opportunities to deliver smarter services and do things differently. Ratepayers expect councils to keep up with changes in technology.

7 These factors are combining to create a desire to see a significant lift in the performance of the sector. While the central government desire for change has been around for some time it is seen that change has not occurred due to public concern about the loss of local democracy which, in turn has meant that desire to see improvements to governance and service delivery arrangements for the future has been lost. In other words the current reorganisation arrangements do not allow for a reorganisation that is focused solely on improving the performance of service delivery or infrastructure provision.

8 To address these issues the Better Local Services package of changes, which is expected to be introduced to Parliament before June 2016 via a proposed amendment to the Local Government Act 2002, includes:

· providing more flexible approaches to reorganisation including an enabling of council-led reorganisations

· giving the Local Government Commission enhanced powers so that it can take a more pro-active role including initiating reform proposals, rather than just reacting to reorganisation proposals

· making greater use of CCOs, particularly in regard to the management of water and transport services, with improved accountability tools to safeguard democratic control

· giving greater ability to transfer functions between territorial authorities and regional councils

· facilitate joint governance arrangements for areas of common and/or shared interest while protecting the integrity of arrangements for iwi in Treaty settlements or other legislation that provide for their involvement in resource management

· obtaining better comparable data on service delivery, corporate accountability and community satisfaction with council performance.

9 Officers will continue to monitor developments in this area including consideration as to whether this Council should lodge a submission to the Local Government and Environment Select Committee once the proposed Amendment Bill is introduced to Parliament.

Local Government Commission

10 As part of its work on promoting and encouraging service improvement across the sector the Local Government Commission are meeting with local authorities on a regional basis to discuss local issues and the support, if any, that the Commission can provide to support service delivery improvements in each region.

11 The Commission are meeting with the Southland Mayors and Chair on Wednesday 13 April 2016. The Commissioners have indicated that they have a particular interest in hearing about the work that is being progressed as part of the Southland Regional Development Strategy and the CDA governance arrangements used within Southland District.

12 Officers will provide a verbal update on the outcomes from the meeting at the 27 April 2016 Council meeting.

Maori Land Rating

13 Government are currently giving consideration to a number of proposed changes to the rating and valuation of Maori freehold land with the intention of creating a system that better reflects the social and cultural values associated with Maori land.

14 The changes being considered include:

· Giving local authorities the power to not assess rates on Māori land that is unoccupied and unused. At present this land needs to be rated and then the rates remitted in accordance with the Council’s Maori freehold land rating policies

· Removal of the 2ha limit for non-rating of marae and urupa. This brings the law into line with the treatment of land around churches

· Making Māori land that is subject to Ngā Whenua Rahui covenants non rateable bringing this land into line with QEII conservation covenants

· Developing a new valuation process for Māori land that recognises the limits that multiple ownership and the cultural values associated with Maori freehold land introduce to its value.

Local Government Risk Agency

15 The work being undertaken by the Establishment Board looking at the business case for establishing a Local Government Risk Agency (LGRA) is now well advanced. A second series of regional workshops will occur in mid-April.

16 Officers understand that while there are significant challenges to establishing a commercially viable entity there is a strong desire to lift the performance of the sector as a whole in the risk management space. The draft business case recommends establishing the LGRA and implementing it in two phases.

17 Phase 1 will focus on closing the identified information and capability gap to lift the standard of local authority risk management across the sector. For this to occur there is a need to gather information of a consistent quality about the infrastructure and assets owned by local authorities, assess their risk management maturity, and identify what needs to be done to close the gap.

18 Phase 2 will focus on growing and maintaining a financially sustainable risk management capability.

19 Alongside of the work on the LGRA work is also well advanced with the government review of the 60:40 co-funding of natural disasters (for three waters infrastructure and river control). It is understood that a discussion document will be released in the near future.

20 Given that this Council has traditionally not had an explicit risk mitigation programme in place in this area the proposed changes to the 60/40 regime will be of significance. Officers see it as important that Council proactively review the way in which it manages the risks it faces in this area. Some work has already been started in this area.

National CDEM Strategy

21 The Ministry of Civil Defence & Emergency Management has commenced work on a new National CDEM Strategy which they are required to have developed by the end of 2017.

22 It is understood that the intention is to trigger a significant ‘step-up’ in the approaches to manage risk and resilience across the New Zealand including a move to focussing on the management of risks rather than disasters.

Building Liability Framework

23 Work is continuing with a review of the joint and several liability regime that local authorities face in relation to building control. It is understood that current government thinking is to introduce a regime under which territorial authorities will have a ‘low cap’ under a joint and several liability regime. Such a cap will be accompanied by improved consumer protection.

24 It is understood that a discussion document, outlining options for a cap on liability and a possible scheme to protect consumers from the ‘uncollectable share’ in a capped regime is planned for release in the near future.

Freshwater National Policy Statement

25 A discussion document was released by the Minister for the Environment in mid-February, marking the next stage of Freshwater Reform.

26 The document proposes some piecemeal changes to the National Policy Statement for Freshwater Management 2014, a new Regulation addressing stock access to waterways, a new Freshwater Improvement Fund, and other new water related measures which could range from changes to the RMA through to non-statutory industry standards and other guidance.

Local Government Benchmarking and Performance Measurement

27 Council was one of 26 NZ Council’s to participate in the PWC Local Government Benchmarking Survey which is undertaken across both NSW and now NZ. Some 79 NSW Councils also participate in the survey meaning that there is a very rich database of other local authorities against which this Council’s performance is being measured.

28 The areas of practice covered by the survey include Workforce, Finance, Operations, Risk Management, Corporate Leadership, Service Delivery and Asset Management.

29 Officers have now received a comprehensive 120 page report that measures this Council’s performance against the other Council’s in the above areas. The survey provides a wealth of detailed information that will be useful for monitoring how this Council’s performance changes over time but also in terms of identifying areas for improvement.

30 Officers are also exploring the potential to join the Local Government NZ Performance Excellence Programme as a Foundation Council. This programme is still in its developmental phase but is intended to provide a ‘high level’ assessment of a Council’s performance. As such it operates at a different level to the very detailed range of data generated from the PWC Benchmarking Survey.

Environmental Services

Proposed District Plan variations to Create Proposed Rural Settlement Areas

31 Councillors will recall that a key driver for this change was to seek to facilitate the ease with which persons can construct a dwelling in several of our smaller towns which do not have a residential zone and where, under the current District Plan provisions, resource consent is often required to construct a new dwelling. This creates additional delays and costs and can act as a deterrent to these towns developing in the future. Under the new Rural Settlement Areas proposed for Athol, Curio Bay, Dipton, Drummond, Fortrose, Garston, Gorge Road, Limehills/Centre Bush, Orepuki, Thornbury, Waianiwa, Waikawa, Waimahaka, Wairio, and Woodlands, dwellings would be permitted as of right subject to a set of performance criteria being met.

32 This proposed change will now proceed further down the First Schedule of the Resource Management Act process with the dates for hearing of submissions to be advised in due course.

Submission to the Proposed Amendments to the Resource Management Act

33 The Council’s submission largely supports the content of the 140 page Local Government New Zealand submission on the proposed changes, while raising the specific local concerns. This includes the suggestion that councils should pay compensation to private owners if their use of their property is significantly impeded by planning controls e.g. by the requirement to protect an area to maintain biodiversity.

34 The proposed amendments suggest a series of changes around streamlining Resource Management Act Plan-making processes, and also streamlining the processes required for undertaking low level work with minor environmental impact. The Council submission supports these changes, which have significant potential to reduce the costs and timeframes for these processes.

Bathurst Takitimu Coal Mine

35 An application to extend the current Bathurst Takitimu coal mine to the northwest, into the area known as “Black Diamond”, has been lodged and the decision on whether this application will be notified or non-notified still to be made at the time of writing this report.

36 While historically mining activity has occurred in the general locality for 100 years plus, the Takitimu mine has been the subject of two previous Southland District Council resource consent processes in recent years, with both consents being granted subject to a series of conditions.

37 The latest consent application, if granted, would see the mining activity move further in a northerly direction, away from the Nightcaps Township.

Ease of Doing Business - SoRDs

38 Council is continuing to support the SoRDs Ease of Doing Business Action Team. As part of this work Focus Group discussions are being arranged with business leaders which should assist with teasing out what the key blockages are to doing business in Southland and assist the Ease of Doing Business team with development of a recommended Action Plan. There has been considerable work done already in the Southland regulatory environment to minimise cross-boundary inconsistencies in planning rules, and to align processes such as having a combined Building Consent application form. There is considerable further potential to continue and develop this work further.

39 Another matter that has been discussed is the ease of entry into councils’ regulatory systems for the customer and whether this can be enhanced and/ or streamlined to a single point of entry. Some research is currently being done on best practice examples from elsewhere in New Zealand and Australia.

40 The Ease of Doing business team contains some Council officers but also a number of private sector practitioners and a Ngai Tahu representative. These parties are volunteering their time free of charge and are bringing very valuable perspectives to discussions.

Services and Assets

Te Anau Airport - Manapouri

41 Certificated Airports Part 139 rule has recently changed requiring consultation with the authority to confirm our aerodrome status as to whether it needs to be certified in the new category of Qualifying Aerodrome. This process is underway now.

42 Consultation for the continued compliance for the GNSS Approach system is underway with Airways New Zealand and Airport Management as a result of our previous provider removing their business from New Zealand.

43 Larger than normal large aircraft movements have been recorded so far this season requiring additional staffing resources; benefiting the community as a whole.

Around the Mountain Cycle Trail (ATMCT)

44 Deloitte are making good progress with the ATMCT review. They are now well advanced with the documentation review and are in the process of interviewing the parties that have been heavily involved with the project.

45 The second week of Environment Court hearing concluded on the 11^th of March 2016. A joint site inspection was held last week between SDC consultants and Fish and Game personnel to try and narrow down the number of issues in dispute. This was fruitful. At the current rate of progress another two weeks of hearing is needed in order for all witnesses to be heard. The next Court session is planned for the week starting 9^th May 2016. The final week is tentatively sent down for the week starting 20^th June 2016. A decision from the Court is not likely until late in 2016 and then there will be an appeal period to wait out.

Community and Futures

Community Futures Project

46 This project is, using Ohai and Nightcaps as a pilot, looking at how Council might manage the issues associated with communities with changing demographics. The issues need to be assessed from both an infrastructure and community futures perspective.

47 A stakeholder’s forum and community engagement workshop were held in Otautau, Ohai and Nightcaps during February and March 2016. These workshops were intended to be the start of an ongoing community engagement process through which help identify the key issues that might arise from these changes and start to look at what some of the solutions might be.

Annual Plan

48 The community consultation process for the 2016/17 Annual Plan has recently been completed with Council receiving some 260 submissions. Verbal submissions were heard on 7 April 2016. Issues raised through the submission process included the proposed sealing of the Catlins Road, maintenance of the Colac Bay foreshore road, the overall level of Council rating given the current downturn in the agricultural industry, Te Anau wastewater and the cost of the Around the Mountain Cycle Trail.

49 Council will make decisions on the submissions received at the Council meeting on 27 April 2016. From there officers will proceed with development of the Annual Plan document itself prior to it being presented to the 29 June 2016 Council meeting for adoption. At this meeting Council will also be asked to set the rates for the 2016/17 financial year.

Recommendation

That the Council:

a) Receives the report titled “Management Report” dated 18 April 2016.

Attachments

There are no attachments for this report.

Council

27 April 2016

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Building Consents and Values for February 2016

Record No: R/16/3/3381

Author: Kevin O'Connor, Manager - Building Control

Approved by: Bruce Halligan, GM - Environment and Community

☐ Decision ☐ Recommendation ☒ Information

Summary/Comments:

1. Building consent numbers for February 2016 were down by only 1% from those of February 2015, but project values were back by 51%. Eight months into the financial year, total consent numbers are back by 13% and project values back by 33%. Dwelling alterations and commercial building number are up slightly with project values back on the previous year. New dwelling and farm building number were back.

		No.	2016 $	No.	2015 $
1.	Dwellings	10	2,018,500	13	3,408,000
2.	Additions to Dwellings	20	506,290	14	509,000
3.	Commercial/Industrial Buildings	7	1,291,650	5	3,921,000
4.	Swimming/Spa Pools	0	0	0	0
5.	Heating Units	14	66,300	14	64,900
6.	Garages	7	120,445	1	8,000
7.	Farm Buildings	13	301,900	17	679,000
8.	Houses for Removal	0	0	2	240,000
9.	Cowsheds	1	500,000	3	1,000,000
10.	Miscellaneous	5	23,500	4	37,000
11.	Certificates of Acceptance	1	20,000	4	41,000
	TOTAL	78	4,848,585	7777	9,907,900

	2016	2015	Variation %
Total consents for month	78	77	1.30
Total consents for year	628	725	13.38 -
Total project values for month	4,848,585	9,907,900	51.06 -
Total project values for year	54,721,149	82,006,083	33.27 -

Average Residential Cost	201,850	262,154
Average House Area (m²)	213.33	218.88

Number of Inspections Carried Out	379	443

Recommendation

That the Council:

a) Receives the report titled “Building Consents and Values for February 2016” dated 27 April 2016.

Attachments

a Appendix A - Consents Database Graph February 2016 View

b Appendix B - Building Consents 5-Year Records - February 2016 View

c Appendix C - Building Consents 5-Year Records - Values - February 2016

Council

27 April 2016

Application Number	Applicant	Address	Ward	Description of Application	Working Days (from receipt of all information)	Total Costs Incurred	Processing Officer	Decision Date
2014/53180	W S Ward and J M Ward	2 Severn Street, Riverton South	Waiau Aparima	Urban subdivision - Two new allotments	19	900.00	Jennifer Green	1/02/2016
2015/53242	Horizon Flowers NZ Limited	1482 Lorne Dacre Road Grove Bush - Mabel Bush	Winton Wallacetown	Transportable house on same location as existing building for workers	19	500.00	Kelwyn Osborn	4/02/2016
2015/53244	A G Taylor and M M Taylor	628 Gallagher Road, West Dome	Mararoa Waimea	Earthworks- Gravel extraction - 18,000 m³	20	500.00	Kelwyn Osborn	4/02/2016
2015/53255	K J Sutherland Contracting	16 Feldwick Road, Feldwick	Waiau Aparima	Earthworks- Gravel extraction 15,000 m³	12	900.00	Theresa Cameron	9/02/2016
2015/53257	L R Squires and L P Squires	114 Elgin Terrace, Stewart Island	Stewart Island Rakiura	Urban & Fiordland Rakiura Zone - Boundary adjustment	20	500.00	Marcus Roy	12/02/2016
2016/53005	P L McKerchar	627 Norman Road, Browns	Winton Wallacetown	Two Lot Subdivision	17	500.00	Jennifer Green	29/02/2016
2016/53007	Fantail Rise Limited	528 Tokanui Gorge Road Highway, Gorge Road	Waihopai Toetoes	Rural Subdivision - Two new allotments	10	740.00	Jennifer Green	9/02/2016
2016/53007	Fantail Rise Limited	528 Tokanui Gorge Road Highway, Gorge Road	Waihopai Toetoes	Rural Subdivision - Two new allotments	10	740.00	Jennifer Green	9/02/2016
2016/53008	Lapsley Family Trust	56B View Street, Manapouri	Mararoa Waimea	Urban Subdivision - Boundary adjustment	17	500.00	Olivia Krielen	15/02/2016
2016/53009	Southland District Council	680 Centre Hill Road, Centre Hill	Mararoa Waimea	Earthworks - Gravel extraction 5,000 m³	20	360.00	Marcus Roy	23/02/2016
2016/53010	R V Beauchamp	30 Meldrum Street, Winton	Winton Wallacetown	New dwelling that breaches recession planes	11	500.00	Olivia Krielen	17/02/2016

Council

27 April 2016

Application Number	Applicant	Address	Ward	Description of Application	Working Days (from receipt of all information)	Total Costs Incurred	Processing Officer	Decision Date
2015/53181	R W Preston and K J Preston	65 Low Road Gladfield - Bayswater	Waiau Aparima	Erect a shed breaching front boundary setback.	6	500.00	Theresa Cameron	3/03/2016
2015/53232	Ministry of Education	10 Salford Street Edendale	Waihopai Toetoes	Urban Subdivision - Four Lots - Subdivision of school site.	13	500.00	Jennifer Green	8/03/2016
2015/53252	Riverton Holiday Park	43 Richard Street Riverton Rocks	Waiau Aparima	Add two accommodation units onto the site and to have 18 sites for campervans. Change the entry and exit points of traffic. Add new on-site advertising sign. Replace existing sign with new sign.	1	500.00	Kelwyn Osborn	31/03/2016
2015/53259	I W Beck	713 Otautau Nightcaps Road Waikouro	Waiau Aparima	Rural Subdivision - Two new allotments - split consent see 360/10/15/260.	19	600.00	Olivia Krielen	2/03/2016
2015/53260	I W Beck	713 Otautau Nightcaps Road Waikouro	Waiau Aparima	American style barn- Breach of recession plane - split consent see 360/10/15/159.	19	240.00	Olivia Krielen	2/03/2016
2016/53011	P T Dawson	(Temporary Address only) 525A Flora Road East	Winton Wallacetown	Change of conditions to 360/10/09/232 - to shift the building platform.	20	696.00	Kelwyn Osborn	3/03/2016
2016/53012	Fiordland New Life Church	6 Blatch Road Te Anau	Mararoa Waimea	Locate dwelling within 150 metres of neighbours dwelling.	16	600.00	Theresa Cameron	8/03/2016
2016/53013	L C Duffell and B Nicolson	18 Waikawa Curio Bay Road Niagara	Waihopai Toetoes	Rural Subdivision.	19	978.00	Jennifer Green	17/03/2016
2016/53014	RD Petroleum Limited	381 Boundary Road Isla Bank	Waiau Aparima	Install a new 20,000 litre diesel storage tank.	20	500.00	Kelwyn Osborn	8/03/2016
2016/53015	Halder Dairies Limited	161 Makarewa Browns Road Lochiel	Winton Wallacetown	Rural Subdivision- Two new lots.	18	740.00	Kelwyn Osborn	10/03/2016
2016/53016	Balfour Returned Services Association	89 Queen Street, Balfour	Mararoa Waimea	Urban Subdivision - One new allotment.	22	500.00	Marcus Roy	14/03/2016
2016/53020	Farmlands Co-Operative Society Limited	10 Otautau Wreys Bush Road Otautau	Waiau Aparima	Rural Subdivision - Two new allotments.	18	500.00	Jennifer Green	21/03/2016
2016/53022	A M Kennedy and A T Kennedy	228A Roslyn Road Roslyn Bush	Winton Wallacetown	To construct a dwellinghouse with 150 metres of existing dwelling. Outside of existing building platform.	18	360.00	Marcus Roy	17/03/2016
2016/53023	McMaster Building Limited	30 Albion Street Athol	Mararoa Waimea	Build a garage within 4.5 metres of a paper road. South and West recession plane breached.	17	500.00	Olivia Krielen	16/03/2016
2016/53024	C R Shaw and E J Shaw	1000 Seaward Downs Gorge Road, Ashers	Waihopai Toetoes	Relocating an additional dwelling to a property less than 50 ha.	1	500.00	Jennifer Green	17/03/2016
2016/53029	M W Eade and C J Eade	31 Milton Street Riverton South	Waiau Aparima	“Retrospective consent for an existing dwelling, land use consent for a dwelling extension and garage which breach the front yard and recession plane requirements.”	15	500.00	Marcus Roy	22/03/2016
2016/53032	Ronaki Dairy Limited Partnership	118 Turnbull Road Kauana	Winton Wallacetown	Farm workers’ accommodation.	12	500.00	Olivia Krielen	21/03/2016
2016/53037	A M Kennedy and A T Kennedy	228A Roslyn Road Roslyn Bush	Winton Wallacetown	Section 221 - Variation to consent notice - see 360/10/16/22.	18	360.00	Marcus Roy	17/03/2016
2016/53038	L R Squires and L P Squires	114 Elgin Terrace Stewart Island	Stewart Island Rakiura	Section 221 - Cancel an existing Consent Notice.	7	120.00	Marcus Roy	17/03/2016

Council

27 April 2016

sdclogo

Venture Southland Business Plan

Record No: R/16/4/5609

Author: Steve Ruru, Chief Executive

Approved by: Steve Ruru, Chief Executive

☒ Decision ☐ Recommendation ☐ Information

Purpose

1 To enable Council to consider and provide feedback on the draft 2016/17 Venture Southland Business Plan.

Executive Summary

2 Each year Venture Southland develops a Business Plan detailing its proposed activities, key performance indicators and budget.

3 The Business Plan is required to be developed in accordance with the Venture Southland Agreement 2014 – 2017 and the Letter of Expectation sent by each Council. The Agreement outlines the information to be included in the Business Plan and the process to be followed as it is developed.

4 Officers are of the view that the draft Business Plan does not currently meet the requirements as set out in the Venture Southland Agreement and also does not adequately reflect this Council’s priorities as detailed in its Letter of Expectation.

5 It is proposed that Venture Southland be asked to revise the draft Business Plan to address the points raised in this report and then bring a revised draft back to Council for its consideration.

Recommendation

That the Council:

a) Receives the report titled “Venture Southland Business Plan” dated 20 April 2016.

b) Determines that this matter or decision be recognised as not significant in terms of Section 76 of the Local Government Act 2002.

d) Asks Venture Southland to revise its draft 2016/17 Business Plan so that it meets the requirements set out in the Venture Southland Agreement 2014 – 2017 and Council Letter of Expectation and provide a further draft to Council for its comment and feedback prior to it being released for public consultation.

e) Asks Venture Southland to provide an allocation of resources against individual projects and activities throughout the Business Plan.

f) Seeks feedback on how Venture Southland would propose reallocating resources and priorities if it does not achieve the level of external funding indicated in the draft Business Plan.

g) Asks Venture Southland to clarify its proposed contribution, including level of resourcing, to the Southland Regional Development Strategy.

h) Seeks clarification of the outputs that Venture Southland proposes delivering against the Community Development Activity for the $731,484 of Southland District Council funding allocated to this activity.

i) Asks Venture Southland to work with Council officers to agree on priorities to be delivered within the level of resource allocated to the Community Development Activity.

j) Asks Venture Southland to include in the Business Plan a set of financial statements that are compliant with the provisions of the Local Government Act 2002 and Generally Accepted Accounting Practice.

k) Asks Venture Southland to revise the Key Performance Indicators so that they have a specific outputs focus.

Content

Background

6 The Annual Business Plan is required to be developed in accordance with the Venture Southland Agreement 2014 – 2017. The Agreement outlines the information to be included in the Business Plan and the process to be followed as it is developed.

7 As part of the agreed process Council provided its letter of expectation to Venture Southland on 30 October 2015 following a workshop facilitated by Venture Southland with combined Council representatives in early October 2015.

8 As a result of this Venture Southland has prepared various iterations of a draft annual Business Plan to which Council officers have provided feedback. The main feedback issues identified have related to clearly identifying resource allocation against outcomes, clearly identifying key performance indicators against which it is proposed Venture’s performance should be measured and clarifying the relationship that Council has as a purchaser of services.

9 Attached is a copy of the report (Attachment A) and 2016-17 Draft Business Plan (Attachment B) that have been received from Venture Southland. This is the third draft received and is now provided to Council for its feedback.

Issues

10 There is a need for the Council to consider and provide feedback to Venture Southland on the draft 2016/17 Business Plan.

Factors to Consider

Legal and Statutory Requirements

11 Venture Southland is a Joint Committee of the Invercargill City Council, Gore District Council and Southland District Council. As such it is not a legal entity in its own right but rather everything it does is undertaken in the name of its ‘shareholder’ Councils.

12 Venture Southland is required to comply with the legislative framework within which the three shareholding Councils operate including the Local Government Act 2002. It is also required to operate in accordance with the Venture Southland Agreement 2014 – 2017.

Community Views

13 Community views will be sought during the usual public submission process going out on the 29 April 2016, and any additional amendments would be considered.

Costs and Funding

14 The proposed Venture Southland budget for delivery of the proposed services is outlined in the draft Business Plan.

15 The proposed Southland District Council funding level, of $1.742 million, is consistent with the 2015 Long Term Plan and remains at the same level as 2015/16.

Policy Implications

16 Under the Venture Southland Heads of Agreement there is a requirement for Venture to prepare an Annual Business Plan that sets out the proposed activities and budget.

17 Clause 8.2.7 of the Agreement requires that Venture should include the specific details for each activity it undertakes:

· The performance measures to be used to measure delivery of the agreed level of service

· How performance is to be assessed and measured

· How the cost of service delivery is to be met or funded

· How the risks are to be managed

· What penalties are to be applied for non-performance

18 Clause 8.1 requires, amongst other things, that the Business Plan sets out:

· A description of each project to be undertaken

· The role that VS will play in its delivery

· A description of the likely benefits from the project and a split of the public and private benefits that will be delivered

· Expected completion date

· Performance measures for the project

· Estimated cost

19 The outputs specified in the Business Plan are then required to be reflected in a Joint Purchase Agreement. In the past the Councils have not agreed an explicit purchase agreement with VS. It is proposed, however, that such an Agreement be negotiated this year.

20 Under clause 8.2 VS is also required to prepare each year an Annual Report that details performance against the Business Plan including the preparation of financial statements that comply with the requirements in section 98 of the Local Government 2002 and comply with Generally Accepted Accounting Practice (GAAP).

21 The draft Business Plan as presented does not fully comply with a number of the provisions outlined above.

Southland District Council Officer Comments

22 The following are generic comments provided to assist Council with its consideration of the draft Business Plan and to assist with the provision of the feedback required to Venture Southland. The list of points is not exhaustive. Rather it is an attempt to capture the main points that Council might wish to consider.

Resource Allocation

23 A traditional business plan details proposed resource allocation against specific outputs of the organisation. This requirement is also reflected in the Business Plan requirements included in the Venture Southland Agreement and in the Letter of Expectation that Council sent in October 2015.

24 Officers are of the view that the current draft of the Plan does not meet the requirements in the Agreement nor provide an adequate explanation of the proposed allocation of resources against different activities and projects. In turn this will make the development of a Joint Purchase Agreement difficult. It is therefore recommended that Council ask Venture to provide a specific allocation of resources against each major project and activity.

25 Throughout the document reference is made to “the extent of this programme is dependent on additional funding being sourced.” Council should seek feedback on the consequences to the overall work programme of Venture Southland if the external funding is not sourced and how it is proposed that the previously allocated resource to these outcomes be reallocated?

26 It is acknowledged that much of the resource allocated is in staff time. Staff time and resource has a dollar value – and Council is interested in how such resource is allocated against outcomes so that it can consider the cost and benefits and the relative effectiveness of the different activities. This is also consistent with service delivery review requirements to be undertaken as per section 17a of the Local Government Act 2002.

Financial Statements

27 At present the Business Plan includes a very simple Operating Statement rather than a full set of financial statements which comply with GAAP. As such it will be difficult for Venture to meet the Annual Report requirements in the Venture Southland Agreement and as required under the Local Government Act 2002. It cannot compare actual performance against budget if no formal budget was set and approved in the Business Plan at the start of the year.

28 Officers are of the view that Venture should be asked to include a full set of GAAP compliant financial statements in its Business Plan.

Regional Development Strategy

29 As part of its letter of expectation Council made it clear that it saw supporting implementation of the Southland Regional Development Strategy (SoRDs) as a priority project.

30 Other than a brief reference to providing support to the implementation of SoRDs, and a number of comments about the background to it, the Plan does not provide a clear outline of the level of support that Venture envisage providing to the next phase of SoRDs in the 2016/17 financial year nor how it would ‘trade-off’ other priorities should the level of resourcing needed exceed the assumptions that it is currently making. SoRDs is also not identified in the proposed performance measures.

31 It is acknowledged that there is, to some degree, a lack of clarity around what level of input SoRDs might demand until the current Action Teams have completed their work. Venture is, however, activity involved in a number of these Action Teams and hence will have a good sense of the direction that they are each taking and therefore the likely demands on Venture Southland. Certainly, it should be able to make a number of assumptions about these demands and provide an outline of the level of risk associated with the assumptions made.

32 It is recommended that Council asks that further information be included in the Plan about the level of resource that Venture envisages being allocated to the implementation of SoRDs and how it would reprioritise its workload to support SoRDs should there be a need to do so.

Community Development Activity

33 In the past Venture has used the title of Community Development to refer to the work that it performs for this Council in local Community Development. The draft of the Business Plan uses the various titles throughout the document referencing Community Development, Rural Community Engagement and Regional Community Development. There is a need for the use of consistent terminology throughout the document. Officers are also of the view that it is local Community Development that is the output sought by this Council and hence assurance should be sought that this is the activity that is to be delivered.

34 The draft plan identifies that Southland District Council contributes $731,484 towards Community Development and that it is the only Council purchasing this activity. Officers are of the view that Council should seek confirmation of the outputs delivered for this level of resource and whether they are simply those detailed on pages 24 – 25 of the Plan or whether there are other outputs which are not identified.

35 Officers are also of the view that they should work with Venture Southland to revise the proposed Community Development activities, projects and key performance indicators to better reflect this Council’s priorities. Council has developed a list of strategic priorities and it is important that the Venture Southland community development activities and KPIs align with these priorities. At present they do not align.

36 As a minimum Council expects the Community Capacity and Capability Building outcomes itemised as part of the letter of expectation to be included as priority KPIs – along with other priorities to be identified as the next part of the draft plan development.

Purchaser/Provider Roles

37 The relationship that Council has established through the Venture Southland Agreement is based on the principles inherent in a purchaser/provider split.

38 In accordance with the purchaser/provider split model the Council set out, in its letter of expectation, its priorities as a purchaser of services. In doing this Council identifies what services are needed to meet the needs of its communities; it assesses these services against the greater Council context with regards to equity and effectiveness in comparison to all areas of Council business; and assesses whether the cost of the services being purchased represents a fair price to pay for the outputs that are being delivered.

39 As the provider of the service Venture Southland is required to focus on the delivery of what is being purchased by Council (and from its other purchasers of services); the efficient and effective delivery of those outputs and ensuring that it operates as a successful business in doing so. Ultimately, Venture Southland is accountable to the ‘shareholder’ Councils in their ownership capacity for its performance as a business.

40 Ultimately, Council needs to be confident that the Business Plan reflects its priorities as a purchaser, that the price which it is paying to achieve delivery of the agreed services is reasonable and that the proposed performance of Venture Southland is satisfactory given its ownership role.

41 Officers are of the view that there is further work needed before they could recommend to Council that the thresholds which it should be expecting Venture Southland to meet both in their capacity as a purchaser of their services and as their owner could be regarded as being met.

42 A number of the areas in which officers believe that there is room for Venture Southland to improve its business planning (eg performance measurement framework, linkage of its strategic framework to Council priorities and financial management) were reflected in Council’s Letter of Expectation with a request that workshops be set up between the two organisations to enable a level of dialogue to occur and agreement reached about the timeframes within which improvements could be made. Unfortunately, these workshops have not occurred within the original timeframes proposed. A new timetable has, however, now been set. Officers will report back to Council on the outcomes from these workshops as appropriate.

Analysis

Options Considered

43 There are two options to consider:

· Endorse the draft 2016/17 Business Plan as received

· Ask for further changes to be made prior to endorsing the draft Business Plan.

Analysis of Options

Option 1 – Endorse draft Business Plan

Advantages	Disadvantages
· Would allow for a Plan to be finalised more quickly which is of importance given that the process is now running significant later than the original timetable set.	· Would result in adoption of a Plan that is not consistent with the Venture Southland Agreement or this Council’s priorities.

Option 2 – Ask for Changes

Advantages	Disadvantages
· Will ensure that the Plan reflects the Council’s priorities and provides a basis for holding Venture Southland accountable for its performance.	· Will potentially delay production of the final Business Plan.

Assessment of Significance

44 The issues in this report are not considered to be significant. Council is simply providing feedback on the draft Venture Southland Business Plan which will be subject to community consultation and further consideration by the Council before being finally approved.

Recommended Option

45 It is recommended that Venture Southland be asked to make changes and revise its draft Business Plan in accordance with the comments included in this report.

Next Steps

46 Venture Southland would prepare a revised Business Plan which would need to come back to Council for further consideration.

Attachments

a Report to Council - 27 April 2016 - Venture Southland Business Plan 2016/17 Draft for Council review. View

b Venture Southland - Business Plan 2016 2017 DRAFT for Council 27 April View

Mayor	Mayor Gary Tong
Deputy Mayor	Paul Duffy
Councillors	Lyall Bailey
	Stuart Baird
	Brian Dillon
	Rodney Dobson
	John Douglas
	Bruce Ford
	George Harpur
	Julie Keast
	Ebel Kremer
	Gavin Macpherson
	Neil Paterson

Registration - Dog (non-working)	$30.00
A dog impounded by SDC released to a SDC authorised rehoming provider for either fostering or rehoming (initial registration only)	Free
Registration - Working Dog	$30.00
Late Registration - All Dogs	50%
Dog Control
Dog hearing lodgement fee	$100.00
Multiple dog licence application fee	$50.00
Sale of collars	$9.00
Withdrawal of infringement fee, per infringement	$30.00
Microchipping
Microchipping of a dog registered by SDC	Free
Commercial breeders that require more than four pups to be microchipped per registration year, per dog, for the fifth and subsequent dog	$30.00
Dog Impounding Fees
Impounding of dogs	$100.00
Sustenance of impounded dog per day or part thereof	$15.00
Euthanasia	$40.00

Registration - Dog (non-working)	$90.00
Less discounts:
(a) Fencing or a controlled property	$20.00
(c) The dog is microchipped as required by the Dog Control Act 1996; and there has been no written warning, barking abatement notice, seizure or infringement under the Dog Control Act 1996 from 1 July 2016 onwards relating to any dog owned by the person applying for the registration	$30.00
(c) The dog is neutered or spayed	$10.00
Registration fee inclusive of (a), (b), and (c)	$30.00
Registration - Working Dog	$30.00
Late Registration - All Dogs	50%

Chief Executive	Steve Ruru
Committee Advisor	Fiona Dunlop

Advantages	Disadvantages
· No advantages	· Venture Southland’s ability to deliver services on behalf of Council would be compromised.