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Informal Workshop Notes
LTP 2024- 2034 Workshop 8 (Session 2)
Regional Council
Held: The workshop was scheduled for Wednesday 25 October 2023, after conclusion of the Regional Council meeting but deferred to 26 October 2023 at 1:00 pm at Regional House, 1 Elizabeth Street, Tauranga and via Zoom (Audio Visual Link).
Chairperson: Chairman Doug Leeder
Deputy Chairperson: Deputy Chairperson Jane Nees
Present: Cr Malcolm Campbell
Cr Stuart Crosby
Cr Toi Kai Rākau Iti (via Zoom)
Cr Kat Macmillan
Cr Matemoana McDonald
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: Staff: Fiona McTavish – Chief Executive; Mat Taylor – General Manager, Corporate; Chris Ingle – General Manager, Integrated Catchments; Namouta Poutasi – General Manager Strategy and Science; Reuben Fraser – General Manager Regulatory Services; Kataraina O’Brien – General Manager Strategic Engagement (via Zoom); Karen Aspey – General Manager People and Leadership; Kumaren Perumal - Chief Financial Officer; Mark Le Comte – Principal Advisor, Finance; AJ Prinsloo – Finance Manager; Gillian Payne – Principal Advisor; Olive McVicker – Corporate Performance Team Lead; Karlo Keogh – Senior Management Accountant; Mary Burford – Programme Manager, Finance and Corporate Performance; Annabel Taylor – Manager, Special Projects; Michael Seabourne – Director, Public Transport; Santiago Bermeo – Senior Planner; Angela Foster – Communications and Engagement Manager; Stephanie Macdonald – Community Engagement Team Leader; Graeme Howard – Corporate Planning Lead; Herewini Simpson – Kaihautu (Te Amorangi Lead) (Via Zoom); Steve Groom – Manager Governance; Merinda Pansegrouw – Committee Advisor.
Other: Stuart Cross - Associate Director, Morrison Low
1. Declarations of Conflicts of Interest
None
Purpose of Workshop No. 8:
· Update on Long Term Plan (LTP) 2024 –2034 Draft Budget Version 2 (within the current strategic context)
o Current Funding Gap
o Funding Levers
· Revenue and Financing Policy review
o Step One analysis (theoretical funding ratios)
o Requirements for Step Two (rates incidence/affordability)
· Rates Remission Policy review
· Overview – Activities (Part 1)
· Pre-engagement Update
3. Workshop Papers
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2024-2034 Long Term Plan - Budget Version 2 Presentation - LTP2024-2034 Public Workshop 25 Oct 2023 - Item 1 Draft Budget V2: Objective ID A4515218 ⇨ |
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Presented by: Mat Taylor - General Manager, Corporate, Kumaren Perumal - Chief Financial Officer and Mark Le Comte – Principal Advisor, Finance. Guidance Sought from Councillors : · Appropriate balance of funding levers to be applied to close the funding gap including revenue and reserves (“Who Pays”). Key Points - Members: · Expressed uneasiness with the timing of the direction on policy matters following the recent 2023 General Elections · Was concerned that the lack of clarity on direction from central government could negatively impact on the LTP workstream/acknowledged the challenge to align central government policy changes with the LTP direction · Noted that, based on case-law directive, Councils’ LTP processes needed to comply with current legislative frameworks · Expressed the view that, within the context of all the imminent changes at a national level, Toi Moana’s intended Governance Review be deferred until the next Government had been established and more certainty was available on the longer-term direction of travel for local government. The timing of the Governance Review to be reconsidered in December 2023 · Encouraged Councillors to continue providing the Governance Manager with appropriate feedback/comments/observations/learnings. Supported the principle of continuing to seek improvement. Key Points - Staff: · Items still to be presented to Councillors for consideration at the 21st November 2023 Workshop included: o Asset Management Plans’ impact o Key activity reviews o Grants/subsidies and collaboration projects not yet identified o Amount of the Quayside Dividend (to be determined through a Statement of Expressions for 2024/25) o Revenue and Financing Policy. Item for Staff Follow Up: · To provide Councillors with a further opportunity to review the Asset Management Plans to feed into Version 3 of the Budget (impacts of the asset management planning infrastructure requirements to be considered through the activity review discussion on the 8th of November 2023). Guidance Sought from Councillors : · Financial strategic intent for the LTP 2024-2034 · Keeping with the existing financial strategy, restoring Council’s financial position to a balanced budget · Should that be the strategic stance, what would be the preferred timing for achieving this position · This direction would help determine/guide discussions/thoughts on how to apply the principles/funding levers to achieve that strategic objective. Key Points - Members: · In terms of the direction of travel for the financial strategy, acknowledged that it was a choice between “stop the bleeding” or “carrying on” · Acknowledged that Council was still in uncertain times; would prefer to get to an effective/efficient balanced budget as soon as possible; preferably within the first three years of LTP 2024-2034, even if it meant using reserves to get there · Was critical to meet legal obligations · Within a cost of living crisis, needed to be mindful of the impact on ratepayers · Reminded that Council still needed to finalise the second part to the Dividends Strategy (reserves left to be used as a top-up when required – i.e. “a balancing tank”) · Acknowledged that the journey to achieving a balanced budget would take more than one year; would however require strategy development in the meantime to ensure the development of a sustainable budget/protected through appropriate reserving for ups and downs · Was not supportive of the principle of “ripping off the band-aid”; preferred a staged/managed approach within three years; should focus/review expenses/funding sources as well · Supported collaboration with other councils to increase cost efficiency (BOPLASS) · Was of the opinion that for LTP 2024-2034 Council would be required to pull several revenue levers, along with a possible increase in fees and charges, a scrutiny of expenditure, and due consideration of deferment of incentives · In order to get back to a balanced budget, council would need to differentiate between “must-haves” and “nice-to-haves” · Reminded that Toi Moana’s updated strategic direction was to be “future ready” and have “a healthy and sustainable environment”; therefore caution needed to be taken to not slash and burn items that had desired environmental outcomes · Supported that fees and charges be reviewed (consideration of the “user pays” principle). Revenue Levels Guidance Sought from Councillors : · Rates was currently capped for Budget Version 2 at the forecasted inflation rate as per Council’s guidance · Councillors could consider allowing an increase of greater than the rate of inflation, which could start in year one or in later years · A 1% increase, for either a general or targeted rate would yield approximately $400,000 (based on the current Revenue and Financing Policy ratios) · To consider if rates should increase faster than inflation · For fees and charges – which would be considered. Key Points - Members: · Acknowledged that considering fees and charges would require a balancing act and that further analysis would be required to make informed decisions · New central government policies/subsidies would impact on future decision making · Would not be supportive of a major increase in rivers and drainage; would prefer to keep as is · Supported the principles of equity and fairness for rates increases · Staff to look at all recommendations across all levels · Acknowledged that the current financial strategy was not sustainable · Noted that a business case, with options, would be presented to councillors, taking into consideration all the extraordinary factors/current challenges. Direction Provided: · Financial strategic intent for the LTP 2024-2034: to keep with the existing financial strategy - to restore council’s financial position to a balanced budget within three years · Supported that reserves be used to subsidise the gap · Critical for reserves to be replenished. |
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Revenue and Financing Policy - Funding Assessments Presentation LTP2024-2034 Public Workshop 25 Oct 2023 - Review of Revenue and Financing Policy Presentation: Objective ID A4515220 ⇨ |
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Presented by: Mat Taylor - General Manager, Corporate, Kumaren Perumal - Chief Financial Officer, Gillian Payne - Principal Advisor, Annabel Taylor – Manager, Special Projects and Stuart Cross - Associate Director, Morrison Low. Guidance Sought from Councillors :: · Assessments of funding sources by activity (Step One), noting that Step Two considerations would take place at a subsequent workshop. Key Points - Staff: · Things to consider: o Who were the beneficiaries and exacerbators at all levels - individual/specific group/regional o What benefits would be received, how would they differ between the groups o How would the distribution of benefits differ o How would the funding decision align with strategic goals and priorities · A climate resilience rate (a new rate/not new “rates”) Key Points - Members: · Cautioned against a climate resilience fund; being a general fund, it could potentially reduce transparency in terms of what it would be allocated for; required it to be specific so the public knew what it would be used for · Having a climate resilience fund would be in line with the strategic direction – to be future ready / resilient /supporting adaptation / align with the science · Enquired how a climate resilience rate would be levied across the region and how it would be applied – fairness/equity needed to be applied · As an environmental council, Toi Moana had the obligation to lead the way and demonstrate the benefit of investment in the adaptation space · Toi Moana had been doing a lot in the adaptation space, defining it as “river and drainage, dune care”. It would be beneficial to identify line items supporting this mahi to make it clear what activities support climate change · Noted that the language to be used to describe a climate resilience fund could potentially differ – the intention was for Council to consider the concept/idea of having a future proofing rate (a targeted rate across the region) · Stressed the need to “stop the creep”: Future for Local Government Report needed to address the current insufficient funding model used for local government. Central government needed to recognise this and address it urgently. Guidance Sought from Councillors: · Invited comments/feedback on the following activities involving material changes: o Rotorua Catchments o Emergency Management o Community Engagement o Public Transport Services o Regional Development(Infrastructure) o Rivers and Drainage Schemes Key Points - Members: · Noted that Freshwater Management was an existing activity funded from general rates · Was concerned about the democratic spread of ratepayers (the concentration of ratepayers skewing the picture in terms of who paid/who the exacerbators/beneficiaries were ), particularly in Tauranga · Supported the Rotorua Catchments proposal; however, deed funding and targeted rates reserves to be reviewed · Maintained the principle of being consistent across the region · For Regulatory Compliance activity, supported that fees and charges be increased · Resource Consents Activity - supported that fees and charges be increased · Rivers and Drainage Schemes Activity – did not support the 50:50 principle; requested an explanation for the reasoning shifting it from 80:20 split · Reiterated the concern about a general rate across the whole district as opposed to a general rate in a particular constituency – needed to be a bit more nuanced about who paid a general rate. Direction Provided: · Supported 80:20 for Rivers Schemes to continue. Item for Staff Follow Up: · Public Transport – requested a 90:10 and 80:20 modelling.
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Rates Remission Policy Review - potential new remission categories Presentation LTP2024-2034 Public Workshop 25 Oct 2023 - Rates Remission: Objective ID A4515217 ⇨ |
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Presented by: Mat Taylor, General Manager, Corporate and Kumaren Perumal, Chief Financial Officer; Gillian Payne, Principal Advisor; Chris Ingle, General Manager, Integrated Catchments; Jo Pellew, Rates Manager and Santiago Bermeo – Senior Planner. Guidance Sought from Councillors · Protected areas of ecological value not already receiving rates relief (Priority Biodiversity Sites [PBSs] and Significant Natural Areas [SNAs]) · Incentives to retire land and recognition of loss of productive potential of land as a result of: o Room for the River o Land affected by natural events o Council assets on private land o Retiring productive land for environmental benefit. · Incentivising establishment of native forests or wetlands (including saltmarsh) on pastoral land retired from production. Key Points: · At the workshop on 25 May, Councillors gave direction to continue work to develop all seven of the new remission ideas presented and where possible to provide estimates of revenue foregone if the remissions would be approved · Presented the financial modelling of remission cost where estimates were feasible, and recommendations for the policy approach and draft eligibility criteria for several new remissions · Presented new incentives for feedback. Priority Biodiversity Sites (PBS) and Significant Natural Areas (SNA) Key Points - Members: · Was concerned about the open-ended nature of some of the suggested incentives – would prefer a capped amount · Was concerned about possible double-dipping / controlling double-dipping · Needed to have an understanding of the bottom-line impact on rates to be remitted · Preference would be for a principle that a general rates portion to be remitted rather than targeted rates portion · For Protected areas of ecological value not already receiving rates relief – would prefer for only PBS to be eligible, since Council would have no control over SNAs would not support SNAs · Needed to be carefully monitored to ensure that there were no unintended consequences · Noting the financial implications, preference would be all PBSs · For every dollar remitted, someone else would need to pay · PBSs – general rates only, supported · Supported the principle of incentivising positive environmental outcomes. Direction Provided: · Supported rates relief for Priority Biodiversity Sites (PBS) for General Rates. Incentives to retire land; adjustments for loss of productive land Key Points: · Recommended approach would be a case by case assessment; recommendations to General Manager responsible for land and river management and Rates Manager · Criteria - Part of plan or programme supported by Council, or in response to a natural event that has already occurred · Considerations – horizontal and vertical equity, precedent setting, community benefit · Exclusions o generally limited to land-value based rates, except where charging area-based rates would create equity issues (Room for the River) o no remissions if income can still be generated from the land · Invited comments/feedback on an annual limit for new remissions under these provisions. Key Points - Members: · Emphasised the importance of using a climate change lens as part of the criteria · Would prefer a capped amount/ringfenced approach · Cautioned that the process should not become an administrative burden · Could be seen as a form of incentivising small changes towards adaptation to the benefit of all. Direction Provided: · Further work to be undertaken to develop criteria to enable Council to give direction on incentives to retire land; adjustments for loss of productive land. Incentives to establish native forests and wetlands retired from production Key Points: · Rate remissions could incentivise landowners that choose to (or are required to) retire marginal pastoral land, to establish native forests, as opposed to exotic forestry, or wetlands (including saltmarsh). This would support Council’s climate change and water quality aspirations. Key Points - Members: · Was concerned about a possible opportunity for double-dipping · Needed to make a distinction between public good and possible future commercial opportunities · Seen as a useful adaptation incentive · Riparian planting should not qualify · Would require policy to understand when it would be applied · Needed to guard against the need to be monitored/managed – should be cost efficient/effective · Noted that a criteria for a covenant/encumbrance would be required. Direction Provided: · Policy development for consultation in March/April 2024. |
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Verbal Update on Engagement Process and Content Presentation LTP2024-2034 Public Workshop No 8 25 Oct 2023 - LTP Pre-engagement Data PDF: Objective ID A4517468 ⇨ |
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Presented by: Angela Foster, Communications and Engagement Manager and Stephanie Macdonald, Community Engagement Team Leader. Key Points: · Further information on the long term plan process for engagement to be provided at the 23 November 2023 LTP Workshop · Informed Councillors of the outcome of recent LTP Pre-engagement surveys · Goal of pre-engagement was high level feedback from the community to provide context for drafting Te Mahere Turoa · Two pulse-style online surveys: o Survey 1 ran for 2 weeks – focussed on priorities for the region o Survey 2 ran for 1 week – focussed on activity specific questions around transport, climate change and flood protection · Promotion: o Tactical email to Participate database o Paid digital campaign · Received some constructive criticism as well as positive comments from the community · Reminded that it was a whistle stop tour as part of pre-engagement involving a small sample of 1600 - 1700 people. Key Points - Members: · Acknowledged the positive and useful feedback. |
Next step:
LTP 2023-2034 Workshop 9 – Public Excluded Transport, scheduled for 3 November 2023.