Agenda of Regional Council - Wednesday, 24 April 2024

Council

Membership

Chairperson	Chairman Doug Leeder
Deputy Chairperson	Cr Jane Nees
Members	All Councillors
Quorum	Seven members, consisting of half the number of members
Meeting frequency	Six weekly or as required for Annual Plan, Long Term Plan and other relevant legislative requirements

Purpose

· Enable democratic local decision-making and action by, and on behalf of, Bay of Plenty communities.

· Meet the current and future needs of communities for good-quality local infrastructure, local public services, and performance of regulatory functions in a way that is most cost-effective for households and businesses.

· Set the overarching strategic direction for Bay of Plenty Regional Council as an organisation.

· Hold ultimate responsibility for allocating financial resources across the Council.

Role

· Address Local Electoral Act matters and Local Government Rating Act matters.

· Oversee all matters relating to identifying and contributing to community outcomes.

· Consider and agree on matters relating to significant new activities or areas of involvement such as infrastructure which are not the responsibility of a specific committee.

· Provide regional leadership on key issues that require a collaborative approach between a number of parties.

· Review and decide the Council’s electoral and representation arrangements.

· Consider issues of regional significance which are not the responsibility of any specific standing committee or that are of such regional significance/high public interest that the full Council needs to decide on them.

· Adopt Council’s Policy on Significance and Engagement Policy.

· Develop, adopt and implement the Triennial Agreement, Code of Conduct and Standing Orders.

· Consider and agree on matters relating to elected members’ remuneration.

· Appoint the Chief Executive, and review their contract, performance and remuneration at least annually.

· Approve all delegations to the Chief Executive, including the authority for further delegation to staff.

· Oversee the work of all committees and subcommittees.

· Receive and consider recommendations and matters referred to it by its committees, joint committees, subcommittees and working parties.

· Approve membership to external bodies and organisations, including Council Controlled Organisations.

· Develop, adopt and review policies for, and monitor the performance of, Council Controlled Organisations.

· Monitor and review the achievement of outcomes for the Bay of Plenty Community.

· Review and approve strategic matters relating to the sale, acquisition and development of property for the purposes of meeting Council’s organisational requirements and implement Regional Council policy.

· Address strategic corporate matters including property and accommodation.

· Consider and agree on the process to develop the Long Term Plan, Annual Plan and Annual Report.

· Adopt the Long Term Plan, Annual Plan and budgets variations, and Annual Report.

· Adopt Council policies as required by statute (for example Regional Policy Statement and Regional Land Transport Strategy) to be decided by Council or outside of committee delegations (for example infrastructure policy).

· Develop, review and approve Council’s Financial Strategy and funding and financial policies and frameworks.

· Institute any proceedings in the High Court that are not injunctive proceedings.

· Exercise the powers and duties conferred or imposed on Council by the Public Works Act 1981.

Delegations from Council to committees

· Council has a role to monitor the functioning of all committees.

· Council will consider matters not within the delegation of any one Council committee.

· Council may at any time, revoke or modify a delegation to a Council committee, either permanently, for a specified time or to address a specific matter, if it considers there is good reason to do so.

· The delegations provided to committees may be further delegated to subcommittees unless the power of further delegation is restricted by Council or by statute.

· It is accepted in making these delegations that:

· The committees, in performing their delegated functions, powers or duties, may, without confirmation by the Council, exercise or perform them in a like manner and with the same effect as the Council itself could have exercised or performed them.

· The delegated powers given shall at all times be subject to their current policies and principles or directions, as given by the Council from time to time.

· The chairperson of each committee shall have the authority to exercise their discretion, as to whether or not the delegated authority of the committee be used where, in the opinion of the chairperson, circumstances warrant it.

Powers that cannot be delegated

Under Clause 32 Schedule 7 of the Local Government Act 2002, Council must make the following decisions:

· Make a rate.

· Make a bylaw.

· Borrow money or purchase or dispose of assets, other than in accordance with the long-term plan.

· Adopt the long-term plan, annual plan, or annual report.

· Appoint a chief executive.

· Adopt policies required to be adopted and consulted on under the Local Government Act 2002 in association with the long-term plan or developed for the purpose of the local governance statement.

· Adopt a remuneration and employment policy.

Livestreaming and Recording of Meetings

Please note the Public section of this meeting is being recorded and streamed live on Bay of Plenty Regional Council’s website in accordance with Council's Live Streaming and Recording of Meetings Protocols which can be viewed on Council’s website. The recording will be archived and made publicly available on Council's website within two working days after the meeting on www.boprc.govt.nz for a period of three years (or as otherwise agreed to by Council).

All care is taken to maintain your privacy; however, as a visitor in the public gallery or as a participant at the meeting, your presence may be recorded. By remaining in the public gallery, it is understood your consent is given if your image is inadvertently broadcast.

Opinions expressed or statements made by individual persons during a meeting are not the opinions or statements of the Bay of Plenty Regional Council. Council accepts no liability for any opinions or statements made during a meeting.

Regional Council 24 April 2024

Recommendations in reports are not to be construed as Council policy until adopted by Council.

Agenda

E te Atua nui tonu, ko mātau ēnei e inoi atu nei ki a koe, kia tau mai te māramatanga ki a mātau whakarite mō tēnei rā, arahina hoki mātau, e eke ai te ōranga tonu ki ngā āhuatanga katoa a ngā tangata ki tō mātau rohe whānui tonu. Āmine.

“Almighty God we ask that you give us wisdom in the decisions we make here today and give us guidance in working with our regional communities to promote their social, economic, environmental and cultural well-being. Amen”.

1. Opening Karakia

2. Apologies

3. Public Forum

4. Items not on the Agenda

5. Order of Business

6. Declaration of Conflicts of Interest

7. Public Excluded Business to be Transferred into the Open

8. Minutes

Minutes to be Confirmed

8.1 Regional Council Minutes - 26 March 2024 2

9. Reports

Decisions Required

9.1 Quayside Group draft Statements of Intent for 2024/25 and Half-Yearly Report 2023/24 2

Attachment 1 - Statement of Expectations Quayside Holdings 2024-2027 - 21 December 2023 2

Attachment 2 - Quayside Holdings - Interim Financial Statements - 31 December 2023 2

Attachment 3 - QHL Draft Statement of Intent 2024 - 2027 - Cover Letter 2

Attachment 4 - Draft Quayside Group Statement of Intent 2024-2027 2

Attachment 5 - Toi Moana Trust - Quarterly Report December 2023 - Public Agenda 2

Attachment 6 - Toi Moana Trust - Portfolio Overview December 2023 - CONFIDENTIAL - Public Excluded

9.2 Local Government Funding Agency Limited - draft Statement of Intent 2024-2027 and Half Yearly report 2

Attachment 1 - Cover Letter LGFA Half Year Report to December 2023 2

Attachment 2 - LGFA Half Year Report to December 2023 2

Attachment 3 - LGFA Letter of Expectations 2024-2027 Nov 2023 2

Attachment 4 - LGFA Cover letter to Shareholders to accompany Draft SOI 2024-27 2

Attachment 5 - LGFA draft Statement of Intent 2024-2027 2

9.3 Bay of Plenty Local Authority Shared Services Limited - draft Statement of Intent 2024-2027 and Half Yearly Report 2

Attachment 1 - Bay of Plenty Local Authority Shared Services Limited Half Yearly Report for the period ended 31 Dec 2023 2

Attachment 2 - Bay of Plenty Local Authority Shared Services Limited draft Statement of Intent 2024-2027 2

9.4 Regional Software Holdings Limited - Draft Statement of Intent 2024-2027 and Half Yearly Report 2

Attachment 1 - Regional Software Holdings Limited Half Yearly Report for the period ended 31 Dec 2023 2

Attachment 2 - Regional Software Holdings Covering Letter for draft Statement of Intent 2

Attachment 3 - Regional Softward Holdings Limited draft Statement of Intent 2024-2027 2

10. Public Excluded Section

Resolution to exclude the public

Excludes the public from the following parts of the proceedings of this meeting as set out below:

The general subject of each matter to be considered while the public is excluded, the reason for passing this resolution in relation to each matter, and the specific grounds under section 48(1) of the Local Government Official Information and Meetings Act 1987 for the passing of this resolution are as follows:

Item No.	Subject of each matter to be considered	Reason for passing this resolution in relation to each matter	Grounds under Section 48(1) for the passing of this resolution	When the item can be released into the public
9.1	Quayside Group draft Statements of Intent for 2024/25 and Half-Yearly Report 2023/24 - Attachment 6 - Toi Moana Trust - Portfolio Overview December 2023 - CONFIDENTIAL - Public Excluded	Withholding the information is necessary to protect information where the making available of the information would be likely to unreasonably prejudice the commercial position of the person who supplied or who is the subject of the information.	48(1)(a)(i) Section 7 (2)(b)(ii).	To remain in public excluded.
10.1	Public Excluded Regional Council Minutes - 26 March 2024	As noted in the relevant Minutes.	As noted in the relevant Minutes.	To remain in public excluded.

9.1 Quayside Group draft Statements of Intent for 2024/25 and Half-Yearly Report 2023/24

Attachment 6 - Toi Moana Trust - Portfolio Overview December 2023 - CONFIDENTIAL - Public Excluded

Minutes to be Confirmed

10.1 Public Excluded Regional Council Minutes - 26 March 2024

11. Public Excluded Business to be Transferred into the Open

12. Readmit the Public

13. Consideration of Items not on the Agenda

14. Closing Karakia

Regional Council Minutes

26 March 2024

Regional Council

Open Minutes

Commencing: Tuesday 26 March 2024, 09:30am

Venue: Council Chambers, Regional House, 1 Elizabeth Street, Tauranga and via Zoom (Audio Visual Meeting)

Chairperson: Chairman Doug Leeder

Deputy Chairperson: Deputy Chairperson Jane Nees

Members: Cr Malcolm Campbell

Cr Stuart Crosby

Cr Toi Kai Rākau Iti

Cr Matemoana McDonald

Cr Kat Macmillan

Cr Ron Scott

Cr Ken Shirley

Cr Paula Thompson

Cr Lyall Thurston

Cr Andrew von Dadelszen

Cr Te Taru White

Cr Kevin Winters

In Attendance: Fiona McTavish – Chief Executive, Mat Taylor – General Manager Corporate, Namouta Poutasi – General Manager Strategy & Science, Reuben Fraser – General Manager Regulatory Services, Pim de Monchy – Coastal Catchments Manager (Acting General Manager Integrated Catchment) Kataraina O’Brien – General Manager Strategic Engagement (via Zoom); Lynda Frew – Legal Counsel (Commercial); Mark Le Comte – Principal Advisor Finance; Tone Nerdrum Smith – Senior Advisor Governance

Apologies: None

Chairman Leeder reminded those present that this meeting was being livestreamed and recorded and that the recording would be made available on the Bay of Plenty Regional Council website following the meeting. Bay of Plenty Regional Council Meeting - 26 March 2024 (youtube.com)

1. Opening Karakia

A karakia was provided by Cr Lyall Thurston.

2. Apologies

Noted that Cr Te Taru White had not yet arrived, but was expected to do so shortly.

3. Order of Business

Noted that Public Excluded item 7.5: Priority One Update on Key Projects had been referred to the extraordinary Council meeting on Friday 5 April 2024.

4. Declaration of Conflicts of Interest

Cr Lyall Thurston: Minute Item 6.3 – Te Whare Taonga o Te Arawa (Rotorua Museum) Funding Agreement as a Trustee of the Rotorua Museum Centennial Trust.

Cr Te Taru White: Minute Item 6.3 – Te Whare Taonga o Te Arawa (Rotorua Museum) Funding Agreement as a Trustee of the Rotorua Museum Centennial Trust.

Chairman Doug Leeder: Public Excluded Minute Item 7.3 Accommodation Reimbursement as he was specifically mentioned in the report.

5. Minutes

Minutes to be Confirmed

5.1

Regional Council Minutes - 15 February 2024

Matters Arising

In relation to Minute Item 4.1 – BOPRC Toi Moana Summer Assistants 2023/24 Presentation, it was noted that the Artificial Intelligence (AI) report referred to was not yet finalised.

Resolved

That the Regional Council:

1 Confirms the Regional Council Minutes - 15 February 2024 as a true and correct record, subject to the following amendments:

Item 5.2 Assessment of Bay of Plenty Regional Council’s practice in relation to the Ombudsman’s “Open for Business” report on the use of workshops, Resolution 6, ADD: “These practices are:

· Ease of access for meeting agendas, papers, and minutes on council websites, both for meetings and workshops.

· An adopted principle of openness by default for all workshops (and briefings, forums etc.), including a commitment to record a clear basis for closure where justified, on a case-by-case basis.

· Ability to call for divisions, abstain from voting, request motions be moved in parts, and have opposition to a resolution recorded facilitates better debate than recording individual votes (‘division) for each resolution.”

Leeder/Nees

CARRIED

5.2

Regional Council Minutes - 6 March 2024

Resolved

That the Regional Council:

1 Confirms the Regional Council Minutes - 6 March 2024 as a true and correct record.

LEEDER/Nees

CARRIED

6. Reports

6.1

Chairperson's Report

Key Points - Staff:

· Staff were in the process of securing an update by Hekia Parata, Chairperson of the Ministerial Inquiry into woody debris (including forestry slash) to present regarding forestry slash.

Resolved

That the Regional Council:

1 Receives the report, Chairperson’s Report.

Leeder/Nees

CARRIED

9.36 am – Cr White entered the meeting.

Decisions Required

6.2

Supplier Panels Update And Delegations

Presented By: Lynda Frew – Legal Counsel (Commercial) and Pim De Monchy – Coastal Catchments Manager (Acting General Manager Integrated Catchments).

Key Points:

· The term ‘Panel’ meant the approved suppliers that Council staff were able to approach to contract for works

· Clarified how the Panel of suppliers were chosen

· No other change are currently being suggested to financial delegations

· The Ford Road Pump Station contract had been granted ‘under exemption’, which meant efficiencies could be built into the project costs as a result

· Recognised that a clear understanding of the need for an overall beneficial outcome was a key consideration for all procurement plans.

Key Points - Members:

· Concerned that suppliers might not be Bay of Plenty based, which could mean a lack of relevant, local knowledge

· Considered that development of a Council social procurement policy and its definition would be appropriate, and that this could be considered as part of the LTP deliberations

· Recognised that the total cost/price would always be a consideration in the procurement process.

Items for Staff Follow Up:

· Flowchart of the procurement plan to be included in these types of reports for the future for additional clarity for elected members.

Resolved

That the Regional Council:

1 Receives the report, Supplier Panels Update and Delegations.

2 Delegates to the Chief Executive the ability to approve all contracts supplier selections and payments including contract variations and renewals under existing Council supplier panels, with no other changes to financial delegations under the supplier panels.

Leeder/Winters

CARRIED

6.3

Te Whare Taonga o Te Arawa (Rotorua Museum) Funding Agreement

Cr Thurston and Cr White declared an interest in this item and abstained from discussion and voting.

Presented by: Mark Le Comte – Principal Advisor Finance.

Key Points:

· Clarified that formal delegation to the Chief Executive to execute the provisions within the contract had not occurred, and that if Elected Members were satisfied with how the project was progressing and that expectations were being met, this was now sought to be rectified

· Bay of Plenty residents were granted three years of free entry to the Museum. However, noted that Elected Members did not support this for entry-fee charging exhibitions and this would be brought to the attention of the Museum.

Key Points - Members:

· Recognised the general free admission for Bay of Plenty residents, however considered that entry-fee charging exhibitions should not be free for local visitors as such exhibitions represented a significant cost to the museum, as well as a revenue-generating opportunity.

Resolved

That the Regional Council:

1 Receives the report, Te Whare Taonga o Te Arawa (Rotorua Museum) Funding Agreement.

2 Delegates to the Chief Executive to approve the Funding Agreement for Council’s contribution to Te Whare Taonga o Te Arawa (Rotorua Museum).

3 Delegates to the Chief Executive to approve payments totalling $4.1 million to Rotorua Lakes Council that meet the requirements the Funding Agreement for Council’s contribution to Te Whare Taonga o Te Arawa (Rotorua Museum).

Winters/Iti

CARRIED

7. Public Excluded Section

Resolved

Resolution to exclude the public

1 Excludes the public from the following parts of the proceedings of this meeting as set out below:

Item No.	Subject of each matter to be considered	Reason for passing this resolution in relation to each matter	Grounds under Section 48(1) for the passing of this resolution	When the item can be released into the public
7.1	Public Excluded Regional Council Minutes - 15 February 2024	As noted in the relevant Minutes.	As noted in the relevant Minutes.	To remain in public excluded.
7.2	Tauranga Marine Precinct	Withholding the information is necessary to protect information where the making available of the information would be likely to unreasonably prejudice the commercial position of the person who supplied or who is the subject of the information.	48(1)(a)(i) Section 7 (2)(b)(ii).	On the Chief Executive's approval.
7.3	Accommodation Reimbursement	Withholding the information is necessary to protect the privacy of natural persons, including that of deceased natural persons.	48(1)(a)(i) Section 7 (2)(a).	On the Chief Executive's approval.
7.4	Kaituna Drainage Scheme - Bell Road Property Acquisition	Withholding the information is necessary to enable any local authority holding the information to carry on, without prejudice or disadvantage, negotiations (including commercial and industrial negotiations).	48(1)(a)(i) Section 7 (2)(i).	On the Chief Executive's approval.
7.5	Priority One Update on Key Projects – Deferred to 5 April 2024 Extraordinary Council meeting	Withholding the information is necessary to enable any local authority holding the information to carry on, without prejudice or disadvantage, negotiations (including commercial and industrial negotiations).	48(1)(a)(i) Section 7 (2)(i).	On the Chief Executive's approval.

Leeder/von Dadelszen

CARRIED

8. Closing Karakia

A karakia was provided by Cr Te Taru White.

10.55 am – the meeting closed.

Confirmed

Chairman Doug Leeder

Chairperson, Regional Council



Report To:	Regional Council
Meeting Date:	24 April 2024
Report Writer:	Gillian Payne, Principal Advisor and Kumaren Perumal, Chief Financial Officer
Report Authoriser:	Mat Taylor, General Manager, Corporate
Purpose:	For Council to receive the draft Statements of Intent for 2024/25 for the Quayside Group and Half Yearly Reports for Quayside Group, and Toi Moana Trust.

Quayside Group draft Statements of Intent for 2024/25 and Half-Yearly Report 2023/24

Executive Summary

Quayside Holdings Limited (QHL) has delivered a draft Statement of Intent (SOI) for the Quayside Group, for 2024/25, incorporating QHL, Toi Moana Trust and other QHL subsidiaries. It sets out objectives, the nature and scope of activities, performance targets and financial forecasts.

QHL has provided Council with Half Yearly Reports for Quayside Group, for the period ending 31 December 2023 and for Toi Moana Trust (TMT). Councillors received a presentation on key matters in QHL and Toi Moana half yearly results at a briefing on 14 March 2024.

Council is currently consulting on a proposal to enable QHL to reduce its 54.14% shareholding in PoTL, down to a minimum shareholding of 28%. Decisions on the proposal have not yet been made and will only be final once Council has considered public feedback on the sell-down proposal, made its decisions and adopted its Long Term Plan 2024-2034, scheduled for 26 June 2024. The draft SOI makes no assumptions about changes to the Port of Tauranga Limited shareholding.

Quayside is required under legislation to deliver its final SOI before 1 July 2024, therefore the QHL Board of Directors will adopt the SOI in June. The outcome of Council’s post-consultation decisions on 26 June 2024 could materially affect aspects of the SOI if Council’s proposal to enable QHL to reduce its shareholding in PoTL is included in the LTP 2024-2034.

Council has the opportunity to provide feedback to QHL on its draft SOI before the final SOI is adopted by the QHL Board of Directors in June, and it may also direct the QHL Board of Directors to alter the final SOI after its adoption, if Council so wishes.

Recommendations

That the Regional Council:

1 Receives the report, Quayside Group draft Statements of Intent for 2024/25 and Half-Yearly Report 2023/24.

2 Notes that:

(a) Council is currently consulting on a proposal to enable Quayside Holdings Limited to reduce its 54.14% shareholding in Port of Tauranga Limited, retaining a minimum shareholding of 28%, and

(b) decisions on the proposal have not yet been made and will only be final once Council adopts its Long Term Plan 2024-2034, scheduled on 26 June 2024, and

(c) Quayside Holdings Limited is required by legislation to deliver its final Statement of Intent 2024/25 by 1 July 2024, and

(d) to meet legislative requirements, Quayside intends to deliver a Statement of Intent 2024/25 by 20 June 2024, which would make no assumptions regarding the Port of Tauranga Limited shareholding of 54.14%, and

(e) once Council has considered public feedback on the sell-down proposal, made its decisions and adopted its Long Term Plan 2024-2034, it will determine whether any modifications are required to the 2024/25 Statement of Intent for the Quayside Group. If required, Council will follow the process provided for in Local Government Act 2002, Schedule 8 clause 6, to require changes to the Statement of Intent to be made by the QHL Board.

3 Directs staff to prepare feedback to the draft Statements of Intent for the Quayside Group 2024/25, according to the direction of this meeting.

4 Confirms the public be excluded on the grounds set out in the Local Government Official Information and Meetings Act 1987 from consideration of the following report attachment:

(a) Toi Moana Trust - Portfolio Overview December 2023 - CONFIDENTIAL under Section 48(1)(a)(i) Section 7 (2)(b)(ii) as withholding the information is necessary to protect information where the making available of the information would be likely to unreasonably prejudice the commercial position of the person who supplied or who is the subject of the information and that this attachment remain in Public Excluded.

1. Introduction

Quayside Holdings Limited (QHL) is the ‘investment arm’ of Bay of Plenty Regional Council (Council) and is a wholly-owned Council subsidiary. QHL manages Council’s 54.14% shareholding in the Port of Tauranga, other commercial ventures and manages the Toi Moana Trust (TMT), an investment fund, on behalf of Council.

QHL returns an annual dividend to Council that is used to benefit regional ratepayers from across the Bay of Plenty region by reducing their general rates requirement.

Council is currently consulting with the regional community on a proposal to enable QHL to reduce their 54.14% shareholding in Port of Tauranga Limited (PoTL) to a minimum shareholding of 28%. The dividend from PoTL is the primary source of liquidity for QHL to pay Council a dividend.

1.1 Legislative Framework

The Local Government Act (2002) (LGA) sets the requirements, timeframes and general process for the SOI. Every Council Controlled Organisation (CCO) must prepare and adopt a SOI, noting that a SOI may include and apply to two or more related CCOs, as provided in LGA s64(3)(b).

In addition to the SOI, Council may choose to set a Statement of Expectations under LGA s64B and/or require additional plans such as an asset management plan or thematic plan under LGA s64A. Council approved a Statement of Expectations at its meeting on 14 December 2023.

As a brief summary, the process set in LGA Schedule 8 involves:

1. The CCO Board of Directors (the Board) delivers a draft SOI by 1 March. (completed)

2. The shareholders to deliver any comments by 1 May

3. The CCO Board considers comments

4. The CCO Board delivers the completed Final SOI (adopted by the CCO Board) to the shareholders before 1 July

5. The shareholders may, by written notice, extend the deadlines by up to one month.

The shareholders do not have legislative mandate to approve the SOI. However, as set out in LGA Schedule 8 clause 6, the shareholders may, by written resolution, require the Board to modify the SOI, provided that the modifications are:

1. Consistent with the objectives of the CCO’s constitution, and

2. Lawful.

The Board must be consulted on the proposed content of the resolution before it is made. The Board must prepare and adopt a modified SOI as soon as practicable after receiving a resolution from their shareholders.

1.2 Alignment with Strategic Framework

A Vibrant Region

We invest appropriately in infrastructure to support sustainable development.

We work with and connect the right people to create a prosperous region and economy.

The Way We Work

We look to partnerships for best outcomes.

We deliver value to our ratepayers and our customers.

QHL provides Council with arms-length commercial and financial expertise to optimise the value of its investments. It also promotes regional benefit through some of its investments and through the dividend to Council that provides non-rate revenue to fund Council’s activities.

1.2.1 Community Well-beings Assessment

Dominant Well-Beings Affected

¨ Environmental

¨ Cultural

¨ Social

¨ Economic

Medium - Positive

The dividend from QHL enables rates to be reduced. The dividend and capital growth of the investment portfolio helps provide intergenerational equity i.e. providing current revenue while preserving the ability of the investment portfolio to provide income in the future.

2. Draft Statements of Intent and Half-yearly Reports

On 14 December 2023 Council approved a Statement of Expectations (SOE) for QHL and TMT (Attachment 1) which was sent to QHL in late December 2023.

In March, QHL delivered to Council:

· Quayside Group Half Yearly Report for the period ending 31 December 2023, Attachment 2

· a cover letter and draft SOI for the Quayside Group, Attachments 3 and 4

· TMT Quarterly Report dated 31 December 2023. Attachment 5 is the report, excluding the portfolio details, which are commercially sensitive.

2.1 Draft Statement of Intent 2024/25

Key matters to note in the QHL draft Statement of Intent include:

· Forecast net cashflow is sufficient to fully cover Distributions to Council and Perpetual Preference Share (PPS) holders in 2023/24, providing limited surplus for reinvestment to grow the fund.

· The Stage 1 development of Rangiuru Business Park is challenging, because as lead developer, QHL must deliver much of the enabling infrastructure. This is compounded by escalating capital commitments due to inflationary construction costs and rising interest rates.

· Distribution projections for the three years 2024-2027 are in line with the relevant years of the 2023-2026 SOI and the projections in Council's draft LTP 2024-2034. It is noted that they are estimates and subject to actual financial performance, compliance with Companies Act 1993 requirements and approval by Quayside Board.

· Quayside has worked with external advisors to be ready to issue its first climate report for the year ending June 2024.

· The PoTL shareholding represents 79% of the total value of QHL’s investment portfolio, so meaningful diversification of the portfolio will not be possible without divestment. This is the subject of public consultation by Council, currently underway.

· A decision to divest a portion of the PoTL shareholding would require an independent external review of the Statement of Investment Policy and Objectives (SIPO). Quayside is committed to working with Council and its advisors to ensure QHL’s SIPO aligns with Group objectives.

· QHL considers that a formulaic distribution calculation based on adjusted net asset value remains appropriate and intends to have its Distribution Policy and SIPO externally reviewed by 30 June 2025, and the results of these reviews made available to Council.

· An Investment Committee, which will be comprised of QHL Directors and independent investment experts is being established. It will provide governance on investment strategies, portfolio construction and benchmarking and transaction due diligence.

· QHL will work closely with Council to provide the most cost-effective funding solutions as the development of Rangiuru Business Park progresses.

· QHL recommends that Council consider mechanisms to protect sustainability of the fund for intergenerational benefit of the Bay of Plenty and its residents.

Key matters relating to Toi Moana Trust are highlighted on page 15 of Attachment 3.

2.2 Half-yearly results

Quayside Group reported an operating profit of $30.1 million after tax for the six months to 31 December 2023 (2022: $25.4 million), which excludes distributions from the Port of Tauranga Group. Net dividends paid to Council during the half year were $22.5 million (2022: $21.2 million), in line with the current SOI.

The Port of Tauranga Group (PoTL and its subsidiaries) profitability decreased for the first six months of the 2024 financial year as a result of declining container volumes. Net Profit After Tax for the six months to December 2023 was $47.2 million, a 24.6% decrease on the same period versus the previous year. PoTL declared an interim dividend of 6 cents per share (2022: 6.8 cents per share) providing QHL with $22 million future cash flow.

TMT’s market value on 31 December 2023 was $71.2 million and the portfolio’s internal rate of return (IRR)[1] was 5.4%. Council’s investments in TMT totals $70 million. A distribution of $1.75 million was made in December 2023.

2.3 Process for Council’s consideration of the Draft Statement of Intent

The QHL Chair and the Chair of the QHL Audit and Risk Committee briefed Councillors on the half yearly results in March 2024.

Quayside is required under legislation to deliver its final SOI by 1 July 2024, and the outcome of Council’s post-consultation decisions on 26 June 2024 could materially affect aspects of the SOI if Council’s proposal is adopted.

It is therefore proposed that the usual process for finalising the SOI be amended as follows:

a) Council provides feedback on the draft SOI assuming the shareholding in PoTL remains at 54.14% (status quo option in public consultation). Based on discussion and Council direction at this meeting, staff will draft a response to QHL for final approval. This will enable a response to be sent to QHL by 1 May 2024.

b) Quayside then delivers a final SOI by 20 June 2024, also assuming the status quo shareholding in PoTL of 54.14%.

c) Once Council has considered public feedback on the sell-down proposal, made its decisions and adopted its LTP 2024-2034, it will determine whether any modifications are required to the SOI for the Quayside Group. If modification is required, Council will follow the legislated process (Local Government Act 2002, Schedule 8 clause 6) to require the changes to be made to the SOI by the QHL Board.

The objective of any Council directive to modify the SOI would be to ensure the commercial and other considerations are appropriately balanced when planning and undertaking any PoTL divestment that may take place. Examples of potential directives that could be considered are:

· Council may set parameters for the divestment of PoTL shares.

· Council involvement in reviews of QHL’s SIPO and Distribution Policy

· Ensuring tax efficiency at Council Group level.

2.4 Feedback on draft SOI

Feedback to QHL on its draft SOI would include the process matter proposed in section 2.3 above, together with any other matters Council identifies through this meeting.

3. Considerations

3.1 Risks and Mitigations

The major risk of potential misalignment between the final SOI for QHL and the Council’s LTP 2024-2034 has been mitigated by the process described in section 2.2 above.

3.2 Climate Change

The matters addressed in this report are of a procedural nature and there is no need to consider climate change impacts.

3.3 Implications for Māori

The implications for Māori are the same as for the public.

3.4 Community Engagement

Engagement with the community is not required as the recommended proposal / decision relates to internal Council matters only.

3.5 Financial Implications

If the recommendation is adopted by Council, will it result in:

If the answer is ‘no’ to both questions please select the dropdown option 1 and complete appropriately.

If the answer is ‘yes’ to either question please select “Budget Implications” in the building block below and liaise with your Management Accountant in order to complete the Financial Impact table.

Any budget implications will be identified and discussed as part of the Council’s LTP 2024-2034 deliberations.

4. Next Steps

Next Steps: What next? What resources are needed? Further analysis? Timeframes ahead. Any consultation planned. Remind Council of the process ahead. Next update to Council?

Conclusion: Short concluding remarks. Referring back to recommendations. No new content.

QHL’s Half Year Report for the period ending 31 December 2023 will be published on QHL’s website and will also be published on Council’s website.

Following Council discussion and direction, any feedback on QHL’s Draft SOI that is required will be sent by 1 May 2024.

Attachments

Attachment 1 - Statement of Expectations Quayside Holdings 2024-2027 - 21 December 2023 ⇩

Attachment 2 - Quayside Holdings - Interim Financial Statements - 31 December 2023 ⇩

Attachment 3 - QHL Draft Statement of Intent 2024 - 2027 - Cover Letter ⇩

Attachment 4 - Draft Quayside Group Statement of Intent 2024-2027 ⇩

Attachment 5 - Toi Moana Trust - Quarterly Report December 2023 - Public Agenda ⇩

Attachment 6 - Toi Moana Trust - Portfolio Overview December 2023 - CONFIDENTIAL (Public Excluded) ⇩



Report To:	Regional Council
Meeting Date:	24 April 2024
Report Writer:	Gillian Payne, Principal Advisor and Mark Le Comte, Principal Advisor, Finance
Report Authoriser:	Mat Taylor, General Manager, Corporate
Purpose:	For Council to receive the Local Government Funding Agency Limited’s draft Statement of Intent 2024-2027 and Half Yearly report.

Local Government Funding Agency Limited - draft Statement of Intent 2024-2027 and Half Yearly report

Executive Summary

The Local Government Funding Agency Limited (LGFA) has delivered its draft Statement of Intent 2024-2027 (SOI) which sets out the company’s objectives, the nature and scope of its activities, performance targets and financial forecasts for the next three financial years.

The LGFA has also delivered its Half Yearly Report for the period ended 31 December 2023.

Recommendations

That the Regional Council:

1 Receives the report, Local Government Funding Agency Limited - draft Statement of Intent 2024-2027 and Half Yearly report for the period ended 31 December 2023.

2 Agrees that no formal feedback is required on the Local Government Funding Agency Limited’s draft Statement of Intent 2024-2027.

1. Introduction

The LGFA has delivered its draft SOI to shareholders, in response to the Statement of Expectation 2024-2027 (SOE) which was compiled and approved by the LGFA Shareholders’ Council in November 2023 (Attachment 3). Council influenced the SOE through its membership of the LGFA Shareholders’ Council.

Council now has the option to provide comments for the LGFA Board to consider as part of preparing its final SOI. The LGFA Half-yearly Report is provided for information.

1.1 Legislative Framework

The planning and reporting requirements for Council Controlled Organisations (CCOs) are set in the Local Government Act.

Each CCO must deliver a Half Yearly report to its shareholders and this report must be published on an internet site maintained by or on behalf of the council.

Each CCO must deliver a draft SOI to its shareholders on or before 1 March in the year preceding the financial year to which the draft SOI relates. Council may provide feedback on the draft SOI to the CCO on or before 1 May and the final SOI must be delivered before 30 June. The shareholders may, by written notice, extend these timeframes by up to one month.

1.2 Alignment with Strategic Framework

A Healthy Environment
Freshwater for Life
Safe and Resilient Communities
A Vibrant Region
The Way We Work	We look to partnerships for best outcomes.

The LGFA provides access to low-cost debt financing and manages market debt issuance for councils.

1.2.1 Community Well-beings Assessment

Dominant Well-Beings Affected

¨ Environmental

¨ Cultural

¨ Social

þ Economic

Low - Positive

The lower cost of borrowing available through the LGFA provides savings for Council, compared to other arrangements. This helps manage the level of rates, particularly for activities with higher reliance on debt, for example drainage schemes.

2. Half Yearly report for the period ended 31 December 2023

LGFA has delivered a covering letter and its Half Yearly report for the period ended 31 December 2023 (Attachments 1 and 2). Key points from the Half Yearly report include:

• LGFA made a Net Operating Profit for the six-month period of $5.2 million, in line with historical results (2022:1.1 million). LGFA has $21.77 billion of assets and Shareholder Equity of $109.3 million as at 31 December 2023.

• The company met 16 out of its 17 performance targets for the period ending 31 December 2023, missing its target for total operating expenses. The target for the year is <$10 million, and the result for the half year is $5.4 million. It is expected that the year-end result will exceed target due to:

o Higher than budgeted Approved Issuer Levy costs and higher levels of issuance and on-lending

o Legal and associated costs for inaugural; foreign currency issuance

o Preparation for potential role in Local Water Done Well

o Preparation for the proposed ratepayer assistance programme, which is a project managed by a group of councils that aims to provide rates postponement relief to ratepayers.

• LGFA published their first Annual Impact Review Report and are preparing their first report under the Climate Related Disclosure requirements for the 2023/24 Annual Report.

3. Draft Statement of Intent 2024-2027

In November 2023 the LGFA Shareholders’ Council approved a SOE to guide the LGFA Board (Attachment 3). In response, LGFA has provided a covering letter and draft SOI (Attachments 4 and 5 respectively).

Key points to note in the draft SOI include:

• Assumption that there are no implications for LGFA from the Local Waters Done Well Programme. Enabling legislation is expected to be introduced in June and December 2024, and in the meantime a business-as-usual approach to council and CCO borrowing, including for the water activities, is assumed. The final SOI in June 2024 will be updated with implications from any future announcements.

• No further improvement in the credit quality of the sector is expected, given the recent announcement from S&P Global Ratings on the lowering trend in the local government sector.

• Projected Net Operating Gain for 2024/25 is expected to be $15.1 million. LGFA is more cautious in its forecast of Net Operating Gain for the subsequent two years, being $13.1 million for 2025/26, and $10.1 million for 2026/27. This is because of the higher uncertainty of assumptions for interest rates, amount and timing of lending, with $7.1 billion of LGFA bonds and $7.5 billion of Council and CCO loans maturing over the next three years.

• The proposed SOI performance targets are similar to the previous SOI. The focus remains on sustainability, assisting councils with greenhouse gas (GHG) emission reporting, monitoring the credit quality of the sector, and assisting with the implementation of Local Water Done Well Programme.

4. Considerations

4.1 Risks and Mitigations

There are no significant risks associated with this matter. Council is a guarantor of LGFA loans, however, the risk of default by other councils is minimal.

4.2 Climate Change

The matters addressed in this report are of a procedural nature and there is no need to consider climate change impacts. The LGFA provides Climate Action Loans and Green, Social and Sustainable Loans to councils and Council Controlled Organisations. It is developing reporting frameworks to meet its wider environmental obligations.

4.3 Implications for Māori

Impacts for Māori are the same as impacts for the general community.

4.4 Community Engagement

Engagement with the community is not required as the recommended decision relates to internal Council matters only.

The LGFA Half Yearly report and final Statement of Intent 2024-2027 are required to be published on Council’s website. This is done through a link to the LGFA webpage which holds the information.

4.5 Financial Implications

There are no material unbudgeted financial implications and this fits within the allocated budget.

5. Next Steps

Staff will continue to work with the LGFA Shareholders’ Council to promote shareholders’ interests and manage any risks related to Council’s shareholding in LGFA.

Attachments

Attachment 1 - Cover Letter LGFA Half Year Report to December 2023 ⇩

Attachment 2 - LGFA Half Year Report to December 2023 ⇩

Attachment 3 - LGFA Letter of Expectations 2024-2027 Nov 2023 ⇩

Attachment 4 - LGFA Cover letter to Shareholders to accompany Draft SOI 2024-27 ⇩

Attachment 5 - LGFA draft Statement of Intent 2024-2027 ⇩



Report To:	Regional Council
Meeting Date:	24 April 2024
Report Writer:	Mark Le Comte, Principal Advisor, Finance; Gillian Payne, Principal Advisor and Kumaren Perumal, Chief Financial Officer
Report Authoriser:	Mat Taylor, General Manager, Corporate
Purpose:	For Council to receive the Bay of Plenty Local Authority Shared Services Limited’s draft Statement of Intent 2024-2027 and Half Yearly report.

Bay of Plenty Local Authority Shared Services Limited - draft Statement of Intent 2024-2027 and Half Yearly Report

Executive Summary

The Bay of Plenty Local Authority Shared Services Limited (BOPLASS) has delivered its draft Statement of Intent 2024-2027 (SOI) which sets out the company’s objectives, the nature and scope of its activities, performance targets and financial forecasts for the next three financial years.

The BOPLASS has also delivered its Half Yearly Report for the period ended 31 December 2023.

Recommendations

That the Regional Council:

1 Receives the report, Bay of Plenty Local Authority Shared Services Limited - draft Statement of Intent 2024-2027 and Half Yearly Report.

2 Agrees that no formal feedback is required on the Bay of Plenty Local Authority Shared Services Limited’s draft Statement of Intent 2024-2027.

1. Introduction

The BOPLASS has delivered its draft SOI to shareholders. Council now has the option to provide comments for the BOPLASS Board to consider as part of preparing its final SOI.

The BOPLASS Half-yearly Report is provided for information.

1.1 Legislative Framework

The planning and reporting requirements for Council Controlled Organisations (CCOs) are set in the Local Government Act.

Each CCO must deliver a Half Yearly report to its shareholders and this report must be published on an internet site maintained by or on behalf of the council.

1.2 Alignment with Strategic Framework

A Healthy Environment
Freshwater for Life
Safe and Resilient Communities
A Vibrant Region
The Way We Work	We look to partnerships for best outcomes.

BOPLASS provides opportunities to partner with other Councils.

1.2.1 Community Well-beings Assessment

Dominant Well-Beings Affected

¨ Environmental

¨ Cultural

¨ Social

þ Economic

Shared services provide for cost efficiency and sharing best practice.

2. Half Yearly report for the period ended 31 December 2023

BOPLASS has delivered its Half Yearly report for the period ended 31 December 2023 (Attachments 1). Key points from the Half Yearly report include:

· The board believes BOPLASS is on track to achieve all performance targets.

· The 2023 significant NZ weather events had less impact on insurance renewals than anticipated.

· Expenditure and revenue is tracking close to budget for the period.

3. Draft Statement of Intent 2024-2027

LGFA has provided a draft SOI (Attachment 2). Key points to note in the draft SOI include:

· BOPLASS is budgeting to break even in each financial year.

· BOPLASS continues to seek opportunities for efficiency through joint procurement, shared services and sharing best practice.

4. Considerations

4.1 Risks and Mitigations

There are no significant risks associated with this matter. Shared services continue to be on a ‘willing partner’ basis.

4.2 Climate Change

The matters addressed in this report are of a procedural nature and there is no need to consider climate change impacts.

4.3 Implications for Māori

Impacts for Māori are the same as impacts for the general community. BOPLASS considers social procurement and social sustainability.

4.4 Community Engagement

Engagement with the community is not required as the recommended proposal / decision relates to internal Council matters only.

The BOPLASS Half Yearly report and final Statement of Intent 2024-2027 are required to be published on Council’s website. This is done through a link to the BOPLASS webpage which holds the information.

4.5 Financial Implications

If the recommendation is adopted by Council, will it result in:

If the answer is ‘no’ to both questions please select the dropdown option 1 and complete appropriately.

There are no material unbudgeted financial implications and this fits within the allocated budget.

5. Next Steps

Next Steps: What next? What resources are needed? Further analysis? Timeframes ahead. Any consultation planned. Remind Council of the process ahead. Next update to Council?

Conclusion: Short concluding remarks. Referring back to recommendations. No new content.

Staff will continue to work with the BOPLASS on joint initiatives

Attachments

Attachment 1 - Bay of Plenty Local Authority Shared Services Limited Half Yearly Report for the period ended 31 Dec 2023 ⇩

Attachment 2 - Bay of Plenty Local Authority Shared Services Limited draft Statement of Intent 2024-2027 ⇩



Report To:	Regional Council
Meeting Date:	24 April 2024
Report Writer:	Mark Le Comte, Principal Advisor, Finance; Gillian Payne, Principal Advisor and Kumaren Perumal, Chief Financial Officer
Report Authoriser:	Mat Taylor, General Manager, Corporate
Purpose:	For Council to receive the Regional Software Holding Limited’s draft Statement of Intent 2024-2027 and Half Yearly report.

Regional Software Holdings Limited - Draft Statement of Intent 2024-2027 and Half Yearly Report

Executive Summary

The Regional Software Holdings Limited (RSHL) has delivered its draft Statement of Intent 2024-2027 (SOI) which sets out the company’s objectives, the nature and scope of its activities, performance targets and financial forecasts for the next three financial years.

The RSHL has also delivered its Half Yearly Report for the period ended 31 December 2023.

Recommendations

That the Regional Council:

1 Receives the report, Regional Software Holdings Limited - Draft Statement of Intent 2024-2027 and Half Yearly Report.

2 Agrees that no formal feedback is required on the Regional Software Holdings Limited’s draft Statement of Intent 2024-2027.

1. Introduction

The RSHL has delivered its draft SOI to shareholders. Council now has the option to provide comments for the RSHL Board to consider as part of preparing its final SOI.

The RSHL Half-yearly Report is provided for information.

1.1 Legislative Framework

The planning and reporting requirements for Council Controlled Organisations (CCOs) are set in the Local Government Act.

Each CCO must deliver a Half Yearly report to its shareholders and this report must be published on an internet site maintained by or on behalf of the council.

1.2 Alignment with Strategic Framework

A Healthy Environment
Freshwater for Life
Safe and Resilient Communities
A Vibrant Region
The Way We Work	We look to partnerships for best outcomes.

The RSHL provides shared service solutions across the Regional Council sector.

1.2.1 Community Well-beings Assessment

Dominant Well-Beings Affected

¨ Environmental

¨ Cultural

¨ Social

þ Economic

Shared Services provides the opportunity for cost savings.

2. Half Yearly report for the period ended 31 December 2023

RSHL has delivered its Half Yearly report for the period ended 31 December 2023 (Attachments 1). Key points from the Half Yearly report include:

· Revenue is tracking favourably to budget.

· Expenditure (excluding depreciation) is less than budget due to contract retentions, which are expected to be paid by year-end.

· Datacom have advised that development of IRIS NextGen is delayed by at least two months which will impact the start of testing and implementation.

· All performance measures are currently on-track, with annual surveys to be completed in May.

3. Draft Statement of Intent 2024-2027

RSHL has provided a covering letter and draft SOI (Attachments 2 and 3 respectively). Key points to note in the draft SOI include:

· Overall, RSHL is projecting a loss of $823,000. This is driven by:

o The IRIS Programme shows a book loss of $650,000. This is driven by depreciation of $400,000 and use of $250,000 of carry over funds from the 2023/24 financial year.

o The IRIS NextGen Programme shows a book loss of $180,000. This results from the use of a budgeted surplus from the previous year.

· RSHL have endeavoured to better align performance measures with strategic priorities.

4. Considerations

4.1 Risks and Mitigations

Council benefits financially form RSHL by sharing costs with other Regional Councils and Government. If any other funders withdraw from projects, then Council could face a higher share of costs.

4.2 Climate Change

The matters addressed in this report are of a procedural nature and there is no need to consider climate change impacts.

4.3 Implications for Māori

Impacts for Māori are the same as impacts for the general community.

4.4 Community Engagement

Engagement with the community is not required as the recommended proposal / decision relates to internal Council matters only.

The RSHL Half Yearly report and its final Statement of Intent 2024-2027 are required to be published on Council’s website. This is done through a link on the RSHL webpage which holds the information.

4.5 Financial Implications

If the recommendation is adopted by Council, will it result in:

If the answer is ‘no’ to both questions please select the dropdown option 1 and complete appropriately.

There are no material unbudgeted financial implications and this fits within the allocated budget.

5. Next Steps

Next Steps: What next? What resources are needed? Further analysis? Timeframes ahead. Any consultation planned. Remind Council of the process ahead. Next update to Council?

Conclusion: Short concluding remarks. Referring back to recommendations. No new content.

Staff will continue to work with RSHL on projects of mutual benefit.

Attachments

Attachment 1 - Regional Software Holdings Limited Half Yearly Report for the period ended 31 Dec 2023 ⇩

Attachment 2 - Regional Software Holdings Covering Letter for draft Statement of Intent ⇩

Attachment 3 - Regional Softward Holdings Limited draft Statement of Intent 2024-2027 ⇩