2 // HASTINGS DISTRICT COUNCIL LONG TERM PLAN

Transcription

1

2

3

4 Hastings district is fortunate to have so much; a lovely natural environment, a strong cultural history, fabulous climate, easy lifestyle and good community infrastructure. Our future success depends on making the most of these strengths and continuing to ensure all of our people benefit from them. We must be conscious that environmental wellbeing is not traded for economic gain. Food production is fundamental to our economy and sustainable farming of our land is heavily dependent on water and healthy soil. We also need to adapt to a changing world, whether that be through changes to the composition of our population, environmental and technological change, or a new energy future. 2 // HASTINGS DISTRICT COUNCIL LONG TERM PLAN

5 Preparing for greater and different demands on services and facilities from an ageing population. Making Hastings an attractive place to invest in and do business with. Taking into account impacts of sea level rise on coastal communities and infrastructure. Working with others to address skill and labour market needs. Adapting our urban form to a different energy future and to protect our good soils. Working with others to reduce levels of social disadvantage and income gaps in our community. Helping our communities build resilience to impacts from climate change. Keeping abreast of technology and making it work for us and our community. Transitioning to a different water future. LONG TERM PLAN HASTINGS DISTRICT COUNCIL // 3

6 OVER THE NEXT 10 YEARS THE COUNCIL S LONG TERM PLAN SEEKS TO: PRIORITY 1 INVEST SIGNIFICANTLY IN DRINKING WATER INFRASTRUCTURE AS OUR FIRST PRIORITY TO MEET COMMUNITY EXPECTATION AND LIKELY CHANGES TO NATIONAL STANDARDS AROUND SAFE DRINKING WATER. INVEST IN OUR CORE INFRASTRUCTURE TO LOOK AFTER OUR ASSETS PRUDENTLY AND TO MEET NEW CHALLENGES IN BRIDGE STRENGTHENING, INCREASING ENVIRONMENTAL STANDARDS AND CLIMATE CHANGE. INVEST IN THE HASTINGS CITY CENTRE TO INCREASE ITS VIBRANCY AND TO MEET THE CHALLENGES OF CHANGING RETAIL PATTERNS AND HOW PEOPLE USE THE CENTRAL CITY. 4 // HASTINGS DISTRICT COUNCIL LONG TERM PLAN

7 ENSURE A RANGE OF HOUSING OPTIONS ARE AVAILABLE TO MEET THE NEEDS OF A CHANGING COMMUNITY WHILST PROTECTING OUR VALUABLE SOILS. CONTINUE ENHANCING OUR PARKS, RECREATIONAL AND CULTURAL FACILITIES TO MAKE THE HASTINGS DISTRICT A PLACE WHERE PEOPLE WANT TO WORK, LIVE AND PLAY. WORK TOGETHER WITH COMMUNITIES AND OTHERS TO BUILD CIVIC PRIDE, DEVELOP OUR YOUTH AND UPLIFT PEOPLE AND COMMUNITIES. ENSURE INDUSTRIAL DEVELOPMENT OPPORTUNITIES ARE EASILY ACCESSIBLE IN OMAHU, IRONGATE AND WHAKATU/TOMOANA TO MEET OUR TARGET OF INCREASED JOBS AND INVESTMENT. LONG TERM PLAN HASTINGS DISTRICT COUNCIL // 5

8 OUR ENVIRONMENT PRIORITY 1 KEY ISSUE 1 Testing shows our ground water is no longer deemed safe, and because of the risk of contamination from bacteria, viruses and protozoa, treatment is required by the New Zealand Drinking Water Standards. The Havelock North water contamination event in 2016 had a marked impact on our community, and the learnings from that event and subsequent Government Inquiry into Havelock North drinking water confirmed changes to the way drinking water is managed across the country are required. The adequacy of New Zealand Drinking Water Standards (which councils adhered to previously) have been called into question and are almost certain to be amended. Amongst other changes, it s likely to include the requirement of a residual disinfectant such as chlorine in every water supply. Council is continuing to refine the application of chlorine to reduce the smell and taste of it while ensuring the water remains protected and safe to drink. These changes mean that taking a one network approach to how we manage water is important so the necessary standards can be achieved for all water supplies. 6 // HASTINGS DISTRICT COUNCIL LONG TERM PLAN

9 The proposal outlined in this Long Term Plan (LTP) is considered the only viable option to meet new guidelines in respect of the Health Act (1956). Council has engaged considerable external and overseas expert advice in arriving at its water MAIN investment strategy, which consists of a multi-barrier approach to deliver safe OPTIONS drinking water. This approach is explained more fully in the following diagram. Although waiting for new legislative and regulatory reform is a partial option for some of the investment, it is not considered a prudent one. OUR ENVIRONMENT WATER SOURCE PROTECTION Controlling the activities in and around the water catchment area to reduce the risk of micro-organisms entering the aquifer. MONITORING & TESTING OF SOURCE WATER Well above minimum requirements. FILTRATION Removing dirt particles to make the UV treatment more effective. Cl UV Dealing with any protozoa, viruses and bacteria that might be present as the water comes out of the bore. CHLORINATION Protecting the treated water when the water leaves the treatment plant and/or travels through the reticulation pipes to your tap. LONG TERM PLAN HASTINGS DISTRICT COUNCIL // 7

10 OUR ENVIRONMENT OUR PROPOSAL The Water Strategy has an investment focus on the following key areas and is linked to our one network approach to achieve the necessary standards for all water supplies: Abandon Brookvale Borefield Treatment on all sources (UV + chlorine) Reduce network pressures Increase storage MILESTONES What do we need to achieve to meet the objectives SAFE DRINKING WATER ENOUGH WATER APPROPRIATE PRESSURE FIRE FIGHTING CAPACITY SUPPORTS GROWTH RESILIENT SUPPLY CONSERVATION AND DEMAND MANAGEMENT REDUCING EFFECTS ON ENVIRONMENT Utilise existing consented capacity Establish new source COST & FUNDING The key consideration for the community is the payment strategy for the new water investment package. Council s proposal seeks to lift the annual payment from $257 currently to $507 gradually over three years, and to apply this to all properties connected to Council water supplies across the district. This will bring the annual water charge to a sustainable level after three years and align broadly with the timetable to rollout the required infrastructural investment package. This is considered a good balance between community affordability and paying as quickly as possible. Alternative options are: a Increase water rate quicker this option increases the rate by $244 over two years, translating to a saving of $6 compared to the Council proposal. b Increase water rate slower this option would spread increases over five years but would incur additional interest costs which would add $24 to the water rate being proposed by Council. MAIN SUPPLY - INFRASTRUCTURE AND TREATMENT ABANDON BROOKVALE BORE FULL TREATMENT - ALL SOURCES SMALL SUPPLIES - INFRASTRUCTURE AND TREATMENT SMALL URBAN SUPPLIES Waipatu, Te Awanga/Haumoana, Clive, Whakatu $27M $13.5M SMALL RURAL SUPPLIES Waimarama, Waipatiki, Whirinaki TOTAL INVESTMENT PACKAGE $47.5M OVER FOUR YEARS $40.5M $MILLION 2017/ / / /21 $7.0M $MILLION 2017/ / /20 $4.9M $2.1M For more detail on Council s Water Investment Strategy visit 8 // HASTINGS DISTRICT COUNCIL LONG TERM PLAN

11 OUR ENVIRONMENT RURAL WATER SUPPLIES The Government Inquiry into New Zealand drinking water standards is not only changing how we operate and manage our main urban water supplies, but also in our coastal townships (Whirinaki, Waimarama and Waipatiki). The required investment to ensure a district-wide safe and compliant drinking water supply is a significant challenge, as it can only be paid for by the properties connected to those schemes, which is a particularly small number in our rural communities. Therefore, Council is proposing a one network approach whereby the necessary standards can be achieved for all water supplies in the district, paid for by way of a district-wide uniform water rate applied to all properties serviced by a Council water supply. This will have the benefit of future-proofing the various water supply schemes from any shocks or uncertainties in the future. Under the current rating system, the targeted rate for our coastal townships is forecast to reach $670 in Waimarama, $1,200 in Waipatiki and $1,300 in Whirinaki by 2028, with the urban supply rate reaching $610. By creating one district-wide rate all the targeted rates could be harmonised together, with some small supplies gaining a slight advantage, but with little impact on urban supply users, as the number of connections is not significant relative to the scale of the larger urban water supply. Do you support the payment proposal to fund investment in safe drinking water for our community? HAVE YOUR SAY FORECASTED WATER TARGET RATE To fund vital investment in water infrastructure and treatment, Council is proposing to increase the water component of rates by $250 (smoothed over the first three years), with smaller increases in the following years. The rate for water consumption for properties charged via a water meter will increase from its current rate of $0.45 per cubic metre to $0.90 by 2020/21. Reply-paid feedback form LONG TERM PLAN HASTINGS DISTRICT COUNCIL // 9

12 MOVING AROUND KEY ISSUE 2 MAIN OPTIONS Future-proofing key lifelines for our rural communities and key productivity routes for our economy. In 2012, Council adopted a balanced approach to bridge management. The approach divided the bridge stock into three categories: Posted structures (weight restricted, i.e. signposted) Managed structures Strengthened structures New rules introduced by Government have changed the allowable dimension and weight limits for vehicles on New Zealand roads. The updated rule came into effect 1 February This rule permits increased weights for public transport vehicles, specialist vehicles and longer trucks. Council has now assessed all bridges against the new weight limits, and bridges not able to meet the requirements for the heavier weight limit were signposted with weight restrictions in December Considerable investment is required to strengthen bridges on key routes in our network, whilst others will be signposted as weight restricted. A total of 31 bridges will be affected. Further information can be found in the supporting information to the Long Term Plan. The Council proposal is outlined in detail on page 11. Alternative options are: a Speed up the programme over five years this will not impact on the total debt incurred, but may be difficult to achieve in terms of ease of construction. Rates increases will only be incured for five years but at an extra 0.4% ($42,000) per annum for rural ratepayers than the Council proposal. b Slow the programme over 10 years this will not impact on the total debt incurred. Rates increases would be spread longer over 10 years but at a reduced rate translating to a saving on rates of about 0.25% ($26,000) per annum on rural properties in the first seven years. Extra inconvenience for road users is the disadvantage of this option. 10 // HASTINGS DISTRICT COUNCIL LONG TERM PLAN

13 INVESTMENT OVER SEVEN YEARS $10.5M MOVING AROUND OUR PROPOSAL Following consultation with key stakeholders and the rural community, Council s proposal prioritises investment in strengthening the districts bridges based on a) their role and value in future-proofing lifelines for our rural communities and, b) their role and value as key productivity routes for our economy. BRIDGE STRENGTHENING COST & FUNDING This plan includes investment of $10.5m over seven years to strengthen 22 bridges to meet new weight limits (signposted as weight restricted in the interim). A total of nine bridges will not meet new weight limits and will remain weight-restricted permanently. The Council share of this investment ($4.8 million) is funded by loans, with loan repayments funded predominantly through the general rate on rural property owners. This is already built into the forecast rate increases outlined in this document and accounts for approximately 1% ($105,000) on annual rural rates over the next eight years. ESTIMATED SPEND $2,500,000 $2,000,000 $1,500,000 $1,000,000 $500, /19 19/20 20/21 21/22 22/23 23/24 24/25 25/26 26/27 27/28 FINANCIAL YEAR Do you support the level of bridge investment proposed in this plan? How quickly would you like to see the programme implemented? HAVE YOUR SAY Reply-paid feedback form LONG TERM PLAN HASTINGS DISTRICT COUNCIL // 11

14 OUR ECONOMY 4 KEY ISSUE 3 Investing and working with stakeholders for a vibrant and people focused Hastings City Centre. Investing in amenity projects and regulatory changes to help stimulate growth and investment in the Hastings City Centre. Working with businesses and investors to facilitate investment, new business activity and inner-city living. The shape of city centres continues to evolve through new technology and changing retail trends, such as online shopping and big box retail. We need to respond to these trends and to work with others to get the best out of our city centre and create the type of environment where people want to do business and socialise. Our city centre needs to be people-focused. A competitive and attractive city centre is a key objective for Council. The ongoing City Centre Strategy provides a deliberate and considered response to the changing needs of our city centre environment, while enhancing amenity and functionality. It also focuses on working with others and using Council investment to leverage external investment. 12 // HASTINGS DISTRICT COUNCIL LONG TERM PLAN

15 MAIN OPTIONS OUR PROPOSAL KEY ASPECTS OF THE CITY CENTRE STRATEGY OUR ECONOMY The Council proposal is outlined in detail. Alternative options are: a Downsize the programme (only complete one or two of the projects) for example only completing two of the projects will reduce debt by $1.5 millon, translating to a small saving of about $30,000 or $1.20 per year for four years for an average residential household compared to the Council proposal. b No investment in the city centre this would reduce debt by $4.5 million, translating to a small saving of 0.11% ($80,000) in rates in the first four years compared with the Council proposal (or $2.65 per year for an average residential household). Defined areas of activity Outdoor dining enhancement Civic Square upgrade Opera House earthquake strengthening Creating laneways for linkages Enabling first floor apartment conversions Façade enhancements Development of student accommodation Greenspace improvements Lighting for amenity and security Areas for play activity City vibrancy action plan LONG TERM PLAN HASTINGS DISTRICT COUNCIL // 13

16 OUR ECONOMY CENTRAL MALL AND EAST BLOCK ENTERTAINMENT PRECINCT The City Centre Strategy reflects the desire of the community to create a strong, vibrant, compact and resilient city centre with a strong sense of place, high in amenity and reflective of our culture and heritage. The Central Mall and Heretaunga Street East blocks have been identified as the first priorities for Council investment. CENTRAL MALL $1.6 MILLION VISION A place where people gather, rest, socialise, play and shop Our proposal is to upgrade and enhance the Central Mall, creating an urban oasis where people gather, rest, socialise, play and shop. This will include additional seating areas, play provision for young and old, enhanced stage area and lighting to facilitate social interaction, entertainment and evening use and improved linkages to Civic Square. EAST BLOCK ENTERTAINMENT PRECINCT $1.4 CIVIC SQUARE $1.5 MILLION MILLION HERETAUNGA STREET EAST VISION The hospitality, entertainment and retail precinct, full of people, energy and activity, day and night VISION Civic Square is a key civic asset in need of reinvigoration and better intergration into the wider city centre Our proposal is to facilitate the continued development of the Heretaunga Street East blocks into our city centre s hospitality, entertainment and retail precinct; full of people, energy and activity, day and night. This will include the provision of additional outdoor dining areas, amenity lighting and façade enhancements. A proposal to upgrade Civic Square to a more useable and enjoyable space forms part of the Hastings Centre Strategy. The Civic Square will conect to the proposed Arts Precinct, the Central Mall and East Block. The existing facilities will be re-designed to enhance activities and experiences with the Square being the centre point. 14 // HASTINGS DISTRICT COUNCIL LONG TERM PLAN

17 OUR ECONOMY COST & FUNDING The Hastings City Centre Strategy outlines Council s response to this changing city centre environment with an investment of $4.5m over the next four years. The strategy has many parts and a key consideration is encouraging new use, as traditional retail is supplemented by other vibrant activity. This investment is funded by loans, with loan repayments funded through the general rate, predominantly on urban ratepayers. This is already built into the forecast rate increases outlined in this document and accounts for increases of approximately 0.11% ($80,000) or $2.65 per year for an average residential household on annual rates for the next four years. INVESTMENT $4.5M OVER FOUR YEARS Do you support the level of city centre investment proposed in this plan? HAVE YOUR SAY Reply-paid feedback form LONG TERM PLAN HASTINGS DISTRICT COUNCIL // 15

18 WHERE WE LIVE KEY ISSUE 4 Taking action to provide for our communities housing needs. Decision making and programmes: to continue to provide appropriate opportunities for housing development, partnerships to provide for affordable housing, and advocacy for greater social housing. Hastings district is experiencing high demand for housing, and we are in a period of housing growth. With another 6,125 new residents predicted in our district by 2028, Council has identified a need to ensure enough serviced land is available to meet varying housing needs. Council s approach to housing needs is to balance a number of factors including the need to avoid urban development over the district s productive soils, and the need to ensure the required investment in infrastructure (such as water, waste, and roads) is able to be funded through the associated levies charged on new developments. This is only achieved once development is underway. At the same time Council must ensure it is not restraining growth by under-investing in housing development. This balance of supply and demand while protecting our fertile lands is what the Council is seeking to achieve through its Heretaunga Plains Urban Development Strategy (HPUDS), which takes a long-term integrated regional view of urban land use and infrastructure to The key elements within the strategy are: Providing for an increase in households within a smaller land footprint. Ensuring there are incentives to provide more intensive forms of housing. Providing the same housing choices in both Napier and Hastings to maintain a balanced market. Providing housing locations that make efficient use of servicing and transport infrastructure. 16 // HASTINGS DISTRICT COUNCIL LONG TERM PLAN

19 WHERE WE LIVE INFRASTRUCTURE INVESTMENT $29.7M OVER TEN YEARS MAIN OPTIONS HOW FAST DO WE INVEST IN PREPARING LAND FOR RESIDENTIAL DEVELOPMENT? Council relies on development contributions to fund the cost of new infrastructure required to provide critical services to new residential developments. The Council s proposal aims to provide enough land ready for development via a sequenced programme, but without exposing ratepayers to an unreasonable level of financial risk should the housing market slow down and forecast revenue from development contributions not eventuate, which would leave the general ratepayer potentially having to fund some of the committed investment if the land remains undeveloped. The Council proposal is outlined in detail on page 18. Alternative options are: a Downsize the programme reducing the number of new residential growth areas will reduce debt funded by development contributions but will not impact on rates. This reduces ratepayer risk but may potentially constrain growth. This would translate to about $6 million reduction in growth debt. b Speed up the programme commiting to infrastructure investment in more growth areas may further facilitate growth but potentially expose the general ratepayer to funding some of the committed infrastructure should the uptake of new housing slow down. This would translate to an additional growth debt of about $5.9 million if the six-year programme was delivered in three years. LONG TERM PLAN HASTINGS DISTRICT COUNCIL // 17

20 WHERE WE LIVE SPREADING THE GROWTH OVER 30 YEARS The growth programme table below provides an indication of how residential growth is likely to be spread over the next 30 years. Funding for the necessary planning and infrastructure provision is provided for in this Long Term Plan on this basis. The Council Development Contributions Policy (how we fund growth from those benefitting from the infrastructure) is also aligned with this approach. This means there is no impact on rates. RESIDENTIAL DEVELOPMENT - 30 YEAR PROGRAMME OUR PROPOSAL GROWTH PROGRAMME 17/18 18/19 19/20 20/21 21/22 22/23 23/24 24/25 25/26 26/27 27/28 YEARS YEARS HASTINGS Lyndhurst 1 Northwood Lyndhurst 2 Howard Street Lyndhurst Extension Kaiapo Copeland Irongate HAVELOCK NORTH Arataki Remaining Iona Havelock Hills Brookvale/Romanes OTHER Areas Under Development Council Infrastructure Investment $6.1m $3.9m $2.3m $1.1m $2.3m $2.5m $2.3m $5.1m $2.4m $1.7m Council s housing strategy includes planned infrastructure investment of $29.7m over the next ten years. Note: These timings are indicative only and subject to change through more in-depth structure planning for each area and changing market conditions. The programme above sees Lyndhurst Extension following on from the now committed Lyndhurst Stage 2 and Howard Street developments in Hastings. This is in addition to remaining capacity in Lyndhurst Stage 1 and Northwood. Kaiapo Road would then follow around Year 7, with Copeland Road being triggered around Year 14. In Havelock North the remaining capacity in Arataki will be supplemented with the Iona/Middle Road area as the first priority. Further development in the Havelock North Hills would then follow along with the Brookfield and Romanes Drive areas. There is no impact on rates as costs are loan-funded and are recovered via development contributions. Council s housing strategy includes planned infrastructure investment of $29.7m over the next 10 years. The Council manages the development programme to minimise COST & risk, provide certainty for developers and to provide choice in the housing market. FUNDING Risk is minimised by staging developments where possible, having certain land uptake triggers before committing to infrastructure investment, upfront payments in some cases and balancing the programme over time. The risk to Council despite these mitigations is that the general ratepayer may be exposed to funding some of the commited infrastructure should the uptake of the new housing slow down. 18 // HASTINGS DISTRICT COUNCIL LONG TERM PLAN

21 AFFORDABLE AND SOCIAL HOUSING INITIATIVES Council will advocate to Government for local housing initiatives under their new policies, and will: WHERE WE LIVE Work with Housing New Zealand to identify suitable land for redevelopment under the KiwiBuild affordable housing programme Work to attract possible Government investment through the new regional growth fund Work with Government on delivering innovative home ownership options such as rent-to-buy Explore opportunities to deliver affordable housing on Council-owned land Work with Te Taiwhenua o Heretaunga on the Waingakau Village proposal in Flaxmere Do you support the level of housing investment proposed in this plan? HAVE YOUR SAY Reply-paid feedback form LONG TERM PLAN HASTINGS DISTRICT COUNCIL // 19

22 THINGS TO DO KEY ISSUE 5 Creating special places for recreation and interaction The Council s programme of reserve enhancements is ongoing. Community feedback on these projects is highly positive, with the Havelock North Village Green being the latest hugely successful development. Cornwall Park is set for a significant makeover into our next premier playground. The issue which needs to be managed is that as our level of service aspirations increase, so does the cost. Not only the cost of developing new facilities, but also the ongoing cost of looking after them. We have a large amount of reserve area. The Council uses a standard process, inclusive of the community s views, to develop management plans for its reserves. These plans detail the proposed future development on each reserve, subject to budget approval. MAIN OPTIONS The Council proposal is outlined in detail on page 21. Alternative options are: a Complete the projects in a different order Please refer to the feedback form (this would have no major impact on debt or rates). b Slow the programme down impact depends on the scale of slowdown (for example only completing half of the programme in the first three years would reduce debt by $1.8 million, translating to a small saving of about $44,000 or $1.45 per year for four years for an average residential household) compared to the Council proposal. c Complete the projects sooner Council does not have the capacity to deliver the programme faster without significant additional resource. Advancing the programme by $1 million per annum in the first three years would add about 0.5% ($356,000) to rates or $12 for an average residential household in 2018/ // HASTINGS DISTRICT COUNCIL LONG TERM PLAN

23 OUR PROPOSAL Initiatives include installation of a premier playground at Cornwall Park, major enhancement projects for Windsor Park, Raureka Park, Cape Coast, and Havelock Hills reserves, and refreshing eight existing playgrounds. Planned enhancements may include some/all of the below improvements: Landscaping Play equipment Parking and access Security Walkways/ seating Toilet facilities REGIONAL SPORTS PARK The Regional Sports Park continues to grow in popularity and this plan provides for additional onsite parking at a cost of $250,000. Also proposed is an outdoor aquatic facility. The aquatic facility will be approximately the size of a sports field (containing four canoe polo pitches) with the anchor tenant being Canoe Polo Hawke s Bay but the facility will also be used for triathlons, swim safety and small boat tuition. The facility will include an administration building to service canoe polo and the sports fields, in particular, for football, touch and rugby league. The total cost of the facility is $1.1 million with $250,000 of Council funding proposed with the balance from external funding. BUDGET OVERVIEW YEARS 1-3 YEARS 4-10 RESERVE ENHANCEMENTS 2018/ / / Windsor Park $550,000 $675,000 $2,200,000 Cape Coast $80,000 $90,000 $60,000 $1,000,000 Raureka Parks $100,000 $100,000 $100,000 $650,000 Cornwall Park Premier Playground $500,000 $500,000 Waimarama $15,000 $6,000 $20,000 $446,000 Flaxmere Park $115,000 $25,000 $25,000 $366,000 Rural Reserves $10,000 $10,000 $10,000 $140,000 Tainui Reserve $40,000 $60,000 $70,000 $210,000 TOTAL $860,000 $1,341,000 $960,000 $5,012,000 COST & FUNDING The full plan proposes a range of significant park and public space enhancements totalling $8.67m over 10 years. This investment is funded by loans with loan repayments funded through the general rate, predominantly by ratepayers. This is already built into the forecast rate increases outlined in this document and accounts for increases of approximately 0.12% ($85,000) or $2.88 for an average residential household on annual rates in the first three years. INVESTMENT OVER TEN $8.67M YEARS Do you support the level of reserves investment proposed in this plan? HAVE YOUR SAY PROPOSED Reply-paid feedback form THINGS TO DO LONG TERM PLAN HASTINGS DISTRICT COUNCIL // 21

24 OTHER PRIORITIES OUR ENVIRONMENT Funding and action to achieve better environmental outcomes. POP-UP IRRIGATION Council is committed to using water wisely. The use of pop-up sprinklers to water our parks has a number of clear advantages including reduced water use, lower labour costs due to automation and reduced maintenance costs due to less opportunity for vandalism. $1 million is allocated in this plan as part of a rolling implementation programme to install pop-up irrigation. WISE WATER USE A greater focus on infrastructure improvements to minimise leakage, and keeping the community focused on reducing water use in summer. STORMWATER QUALITY The plan includes $125,000 per year to carry out stormwater quality monitoring, site assessments and investigate options to continually improve the quality of stormwater entering the piped network and the wider environment. STREAM ENHANCEMENTS Council has included funding to better understand the state and extent of work needed to ensure that streams within Havelock North can manage flood flows. This work will also look at enhanced reserve and recreational opportunities where appropriate. WASTE MINIMISATION Included in the plan is a continuation of the rural recycling initiative whereby rural recycling facilities are being installed to service the needs of rural communities. Potential changes to how household waste is collected, focused on diverting waste from the landfill are currently undergoing consultation. The outcomes of this discussion with the community will be included within future Long Term Plans. 22 // HASTINGS DISTRICT COUNCIL LONG TERM PLAN

25 MOVING AROUND WALKING AND CYCLING This plan proposes a continued targeted investment in walking and cycling initiatives to advance the Council s sustainable transport objectives. OUR ECONOMY OTHER PRIORITIES Key features of the proposed programme: A total of 26 enhancement projects have been prioritised and will be rolled out over next 10 years and beyond. More than 40% of our key roads will have cycle facilities. Over 90% of all schools within Hastings District will get safe and efficient walk-cycle connectivity. On-going promotion, training and engagement programme. TOP THREE PROJECTS The following projects are the priorities for the next three years: St Aubyn Street Upgrade Willowpark Road Improvements Southampton Street Improvements JOBS AND INVESTMENT Attracting industry, growing investment and creating jobs in Hastings district. An ongoing investment of $800,000 per annum is set aside in the plan for economic development initiatives to facilitate business investment and to grow jobs. INDUSTRIAL LAND AVAILABILITY A key function of Council is to make serviced land available to facilitate industrial expansion and business investment as a way of increasing jobs in our community. Previous budget commitments along with funding in this Long Term Plan makes provision for three areas to support both wet and dry industry in the Omahu, Irongate and the Tomoana/Whakatu areas. This will make sufficient industrial land available for many years into the future. LONG TERM PLAN HASTINGS DISTRICT COUNCIL // 23

26 OTHER PRIORITIES WHERE WE LIVE COASTAL SETTLEMENT Preparing our community for sea level rise and coastal erosion. COASTAL HAZARD STRATEGY 2120 This major project is an important response to climate change in our region. Sea levels are expected to rise up to 1.5 metres over the next 100 years which means business as usual is no longer an option. Because of the significant risks associated with climate change and sea level rise, the three partner councils (Napier City Council, Hastings District Council and Hawke s Bay Regional Council) have been working on the Clifton to Tangoio Coastal Hazards Strategy 2120 to find enduring solutions to our coastal erosion and inundation threats. The work completed so far has identified preferred protection options, along with high-level cost estimates for short, medium and long-term horizons up to 100 years. Our next phase considers design and budget refinements, cost sharing and funding options, and preparing for implementation. Each council has committed funding for this phase of the work. Ongoing consultation will occur with the community during the development of the project. For more information, please go to 24 // HASTINGS DISTRICT COUNCIL LONG TERM PLAN

27 OTHER PRIORITIES THINGS TO DO CITY CENTRE CULTURAL PRECINCT Restoring and enhancing our cultural heart. HAWKE S BAY OPERA HOUSE PRECINCT REDEVELOPMENT Following extensive public consultation in 2016, the community asked Hastings District Council to strengthen the Opera House Theatre, put a permanent roof on the Plaza and come back to the community to discuss what to do with the Municipal Building. Further development of Civic Square into a facility and hub to showcase our social and cultural history which had previously been proposed was deemed unaffordable, and key elements were to be considered as part of future decisions as to the use of the Municipal Building. The construction programme for the theatre is set to take between months and Council is working towards reopening the Opera House formally by December The nett Council funding toward these developments is $8.9 million. MUNICIPAL BUILDING A group made up of councillors and representatives from across the arts community has been considering future uses for the Municipal Building prior to any decision to commit to the necessary earthquake strengthening work on the building. The group are charged with coming up with a range of options to be put before the Council, after which there will be public consultation on the preferred design and cost. The nett Council funding set aside within the Long Term Plan toward this development is $10.5 million, subject to a suitable option and supporting business case which has community support. LONG TERM PLAN HASTINGS DISTRICT COUNCIL // 25

28 OTHER PRIORITIES OUR PEOPLE Working with our people for a better community. UPLIFTING COMMUNITIES TAKING COMMUNITIES FORWARD THROUGH COLLABORATIVE EFFORT Ongoing development and implementation of specific plans for communities (developed with communities). ASSISTING YOUTH INTO TRAINING AND EMPLOYMENT We are working with youth aged years, assisting them to develop the skills and attitudes they need to take a positive part in society, now and into the future. The Youth Development Team supports young people into employment, facilitates the Hastings District Youth Council and delivers the Youth Potential project. There are also Youth Coordinators based at the Flaxmere and Camberley Community Centres. GROWING CIVIC PRIDE The Civic Pride project was initiated in 2017 with the purpose of promoting civic pride in Hastings district. Actions thus far include the creation of the tag-line #HastingsProud which is being used in a variety of ways to celebrate civic pride. The sponsor of the project is Hastings Ambassador, Councillor Henare O Keefe. More actions are planned for SUPPORTING MANA WHENUA Council is focused on building stronger relationships with iwi and hap. Our aim is to better reflect Māori cultural values and concerns in our planning and decision-making, and increase our responsiveness as an organisation to Māori. Council is supporting this through two new appointments whose roles will bring knowledge and support to all aspects of Council operations. 26 // HASTINGS DISTRICT COUNCIL LONG TERM PLAN

29 On average $51 million per annum is proposed to be invested in either renewing assets, improving the community with new assets or providing assets which assist our community to grow. This plan contains some significant capital expenditure projects which improve the level of service in the community. These projects are loan-funded. Four of the key expenditure drivers (water investment, bridge strengthening, reserve enhancement and city centre investment) are covered in more detail in this plan. In brief, the key capital expenditures are: Water investment programme Bridge strengthening Hastings City Centre investment Reserves enhancements, and an escalation in reserve renewals An escalation in road pavement renewals 30 YEAR CAPITAL EXPENDITURE FORECAST (EXCLUDING INFLATION) INFRASTRUCTURE HIGHLIGHTS Provision for longerterm road developments Renewal of key wastewater mains Stormwater renewals (commencing after Year 10) Investment in residential growth areas Development of the Omarunui Landfill. The Council s standard approach to funding the renewal of assets is to fund this annually from rates. However in limited instances (particularly in the wastewater area) there are large, expensive assets that need renewal such as our wastewater trunk mains, which are funded by loans. This ensures the cost is spread equitably and all ratepayers therefore contribute fairly to these costs. Capital expenditure related to servicing new growth areas is loan funded and repaid via development contributions. The graph shows a snapshot of total capital expenditure as outlined in the Council s Infrastructure Strategy (first 10 years in detail and five-year averages for year 11-30). The effect of inflation is shown separately for the 30 years of the plan. OTHER PRIORITIES $90,000, $80,000, $70,000, $60,000, $50,000, $40,000, $30,000, $20,000, $10,000, ANNUAL PLAN ANNUAL PLAN INFLATION VIEW ANNUAL PLAN YR YR YR YR TOTAL CAPITAL RENEWALS YR YR YR YR YR YR TOTAL CAPITAL LEVEL OF SERVICE YEARS AVERAGE YEARS AVERAGE YEARS AVERAGE YEARS AVERAGE TOTAL CAPITAL GROWTH LONG TERM PLAN HASTINGS DISTRICT COUNCIL // 27

30 FINANCIALS The impact on Council finances and your rates. FINANCIAL STRATEGY The Council s financial strategy is largely shaped by the magnitude of investment required to deliver safe drinking water to our community. The funding of that investment is predominantly spread over the first three years of the plan. This will see forecast rate increases set at levels over what would normally be considered business as usual activity. The Council s short to medium-term debt position also reaches a point not considered to be optimal for our community, looking to the future. In response to this a debt repayment strategy has been built into the budget forecast from Year s 5-10 to return debt levels back to a sustainable position by Year 10. Overall, this plan aims to navigate our community through a period of unprecedented water investment, addresses the key infrastructure challenges outlined in Council s Infrastructure Strategy and provides for some level of service improvement projects desired by the community. After an initial three-year period of escalated community funding demands the plan returns to forecast rate increases of 3% per annum. The graph below shows the forecast rates (excluding water) with baseline expenditure capped at 3% or less. ANNUAL RATING REVENUE MOVEMENT (BASE EXPENDITURE) 6.00% 5.00% 4.00% 3.00% 2.00% 1.00% 0.00% 18/19 19/20 20/21 21/22 22/23 23/24 24/25 25/26 26/27 27/28 BASE INCREASE (EXCLUDING WATER) 28 // HASTINGS DISTRICT COUNCIL LONG TERM PLAN

31 The graph to the right shows the forecast average residential rates increase, including the necessary investment in delivering safe drinking water to parts of our community serviced by a Council water supply. ANNUAL RATING REVENUE MOVEMENT (INCLUDING ADDITIONAL WATER LEVY) 7.00% 6.00% 5.00% 4.00% 3.00% 2.00% 1.00% FINANCIALS 0.00% 18/19 19/20 20/21 21/22 22/23 23/24 24/25 25/26 26/27 27/28 BASE INCREASE WATER LEVY LIMITS ON RATES AND RATE INCREASES The Council s maximum policy limit on rate increases is set at Local Government Cost Index (LGCI) + 4%. This is an upper limit to allow for unforeseen circumstance, such as a natural disaster. FINANCIAL STRATEGY LIMIT 2018/19 BUDGET Rates increase less than (LGCI 2.2%+ 4%) or <6.2% 5.9% Nett debt as a % of income less than 150% 98.85% Nett interest as a % of income less than 15% 4.47% Nett interest as a % of annual rates income less than 20% 7.32% Liquidity range 110%-170% 125% Likewise the quantified limit on total rates income will not exceed the rates in any one year (+4% and the movement in the LGCI). Planned rates income falls well within this limit. See the Long Term Plan supporting information for more detail. Council budgets have been set well within Treasury Policy limits as shown in the table. BALANCED BUDGET BENCHMARK REVENUE/EXPENDITURE (%) 120% 101% 101% 101% 103% 103% 104% 105% 107% 108% 109% 100% 80% 60% 40% 20% 10% 0% 18/19 19/20 20/21 21/22 22/23 23/24 24/25 25/26 26/27 27/28 BENCHMARK MET ARE WE BALANCING THE BUDGET? One of the key financial targets for a council is to ensure that annual operating revenue is set at a level to fund annual operating expenses. The graph opposite shows we are on track with this legislative benchmark, and that our budgets are fiscally prudent. LONG TERM PLAN HASTINGS DISTRICT COUNCIL // 29

32 FINANCIALS OUR DEBT FORECAST In circumstances where expenditure benefits ratepayers over an extended time period, the use of loan funding is an important tool to ensure costs are spread across ratepayers over time. External debt is forecast to peak at $169 million in 2021/22, reducing to $116 million by 2027/28. Debt can be separated into two parts: (A) Growth Debt for new development areas which is funded directly from developers via development contributions. This is only incurred if growth happens. (B) Community Debt which has been created from projects undertaken for the benefit of the wider community. These two components of the forecast debt position are outlined in the graph to the right. PUBLIC DEBT FORECAST SUMMARY ONLY EXTERNAL $180,000, $160,000, $140,000, $120,000, $100,000, $80,000, $60,000, $40,000, QUANTIFIED LIMIT ON DEBT We use a number of measures to assess our debt position, one of which is nett debt as a percentage of income. By using this calculation, in Year 4 (2021/22) when debt peaks the Council has $40 million of debt capacity and by Year 10 the debt capacity increases to $130 million. This calculation is a maximum and the graph below shows that once the initial period of investment in drinking water and bridge strengthening is addressed Council has set debt levels well below the maximum policy limit. $20,000, COMMUNITY DEBT GROWTH DEBT NET DEBT (EXTERNAL DEBT) CREDIT RATING GREAT RESULT The Hastings District Council has recently received its credit rating from S&P Global Ratings. That long-term rating of AA is as good as any Council has received in New Zealand. Therefore while the use of debt funding increases in the early years of the plan (predominantly to fund the water investment programme), independant review and assurance is positive regarding the outlook for Council finances. 30 // HASTINGS DISTRICT COUNCIL LONG TERM PLAN

33 The previous section outlines the general impact of Council s proposals on the overall Council finances. How do these proposals affect you? FINANCIALS NOT ALL RATES BILLS ARE EQUAL Often you will hear people talk about average rates increases being at a certain level. But simply taking that figure and applying the increase to your rates invoice will not necessarily give an accurate representation. Why? Well actually there are a number of reasons. A property may be more valuable than another, or it may be connected to Council services whilst another may not. A property may be in an urban area and closer to facilities than a rural property. A property may be used for a commercial purpose rather than as a home. All of these factors can impact on the level of rates. We have outlined opposite some examples of common types of property in our district and the average rates impact of the 2018/19 budget. These are examples only, for specific information on your property please use the rates database which can be found at RATING AREA ONE LAND VALUE ($) RATES 2017/18 ($) PROPOSED RATES 2018/19 ($) Urban Residential Flaxmere 52,000 1,558 1,692 Hastings 175,000 2,257 2,424 Havelock North 225,000 2,564 2,745 Townships Whakatu 60,000 1,422 1,551 Clive 180,000 1,991 2,148 Haumoana 235,000 1,864 2,023 Commercial / Industrial Hastings CBD Retail 450,000 11,106 11,644 Havelock Nth CBD Retail 600,000 13,204 13,859 Suburban 600,000 10,589 11,159 Commercial Non-Urban 575,000 8,209 8,585 Horticulture / Farming Small 350,000 1,887 1,960 Medium 700,000 3,238 3,377 RATING AREA TWO LAND VALUE ($) RATES 2017/18 ($) PROPOSED RATES 2018/19 ($) Coastal Residential Whirinaki 250,000 1,360 1,531 Waimarama 260,000 1,541 1,575 Waipatiki 215,000 1,728 1,806 Commercial / Industrial Small 82, Medium 275,000 1,750 1,798 Farming Small 220,000 1,119 1,135 Medium 2,600,000 7,540 7,882 Large 8,000,000 22,109 23,191 LONG TERM PLAN HASTINGS DISTRICT COUNCIL // 31

34 OTHER MATTERS CIVIL DEFENCE EMERGENCY MANAGEMENT (CDEM) FUNDING The Hawke s Bay Civil Defence Emergency Management Group (CDEM) is made up of the Wairoa District, Hastings District, Napier City, Central Hawke s Bay District and Hawke s Bay Regional councils. As a collective the group is responsible for the reduction of risks and the readiness, response and recovery of our communities to disasters. Historically each Council has funded its share of this activity. In this plan it is proposed to cease the rate for CDEM as part of our general rate. The funding for this activity will now be part of Hawke s Bay Regional Council s rates by way of an increase to the existing Civil Defence Targeted Uniform Annual Charge, charged to each rateable property across Hawke s Bay. In simple terms this is a transfer of funding and costs from the Hastings District Council to the Hawke s Bay Regional Council, totalling $200,000. The Hastings District Council has decided to maintain a local incident management response presence so it can respond effectively to events that impact on the Council s essential services in the Hastings District, given the learnings from recent events. This means that the actual reduction in the total funding gathered as part of our general rate is $130,000. This reduction is factored into the overall forecast rates outlined in this plan. The CDEM group believe that taking a shared service approach to Civil Defence and Emergency Management is the best way to improve the capability for Hawke s Bay to respond to and bounce back from a disaster. This proposed change to how we fund civil defence will help this to happen. Further information is outlined within Hawke s Bay Regional Council Long Term Plan. DEVELOPMENT CONTRIBUTIONS POLICY Council undertook a thorough review of this policy in 2016, so the proposed changes are relatively minor in nature. These include updating growth forecasts, capital expenditure budgets, timing of works, and uptake rates for Irongate and Omahu Industrial areas, which have resulted in changes to the schedule of charges (i.e. the contribution rate each development pays). The contribution rate for Commercial, Greenfield and Rural development has increased, whilst the contribution rate for Industrial (including Irongate and Omahu), Infill and Medium Density has decreased. Further information can be obtained through the Draft 2018/19 Development Contributions Policy or by contacting the Financial Policy Advisor on RATING MATTERS Over the last five years changes have gradually been phased-in to the differential rating system. The Council have paused to review whether the remaining three years of the initial proposal are required and are fair and equitable. The system used for setting rates for the 2017/18 financial year will therefore be unchanged for the 2018/19 year. Further details can be found within the Rating Policy section in the full Long Term Plan document. 32 // HASTINGS DISTRICT COUNCIL LONG TERM PLAN

35 Independent auditor s report on Hastings District Council s Consultation Document for its proposed Long Term Plan I am the Auditor General s appointed auditor for the Hastings District Council (the Council). Section 93C of the Local Government Act 2002 (the Act) requires an audit report on the Council s consultation document. We have done the work for this report using the staff and resources of Audit New Zealand. We completed our report on 22 March OPINION In my opinion: the consultation document provides an effective basis for public participation in the Council s decisions about the proposed content of its long term plan, because it: fairly represents the matters proposed for inclusion in the long term plan; and identifies and explains the main issues and choices facing the Council and district, and the consequences of those choices; and the information and assumptions underlying the information in the consultation document are reasonable. BASIS OF OPINION We carried out our work in accordance with the International Standard on Assurance Engagements (New Zealand) 3000 (Revised): Assurance Engagements Other Than Audits or Reviews of Historical Financial Information. In meeting the requirements of this standard, we took into account particular elements of the Auditor General s Auditing Standards and the International Standard on Assurance Engagements 3400: The Examination of Prospective Financial Information that were consistent with those requirements. We assessed the evidence the Council has to support the information and disclosures in the consultation document. To select appropriate procedures, we assessed the risk of material misstatement and the Council s systems and processes applying to the preparation of the consultation document. We did not evaluate the security and controls over the publication of the consultation document. RESPONSIBILITIES OF THE COUNCIL AND AUDITOR The Council is responsible for: meeting all legal requirements relating to its procedures, decisions, consultation, disclosures, and other actions associated with preparing and publishing the consultation document and long term plan, whether in printed or electronic form; having systems and processes in place to provide the supporting information and analysis the Council needs to be able to prepare a consultation document and long term plan that meet the purposes set out in the Act; and ensuring that any forecast financial information being presented has been prepared in accordance with generally accepted accounting practice in New Zealand. I am responsible for reporting on the consultation document, as required by section 93C of the Act. I do not express an opinion on the merits of any policy content of the consultation document. INDEPENDENCE In carrying out our work, we complied with the Auditor General s: independence and other ethical requirements, which incorporate the independence and ethical requirements of Professional and Ethical Standard 1 (Revised); and quality control requirements, which incorporate the quality control requirements of Professional and Ethical Standard 3 (Amended). In addition to this report on the Council s consultation document and all legally required external audits, we have provided an assurance report on certain matters in respect of the Council s Debenture Trust Deed. These assignments are compatible with those independence requirements. Other than these assignments, we have no relationship with or interests in the Council or any of its subsidiaries. AUDIT REPORT Stephen Lucy Audit New Zealand On behalf of the Auditor General, Wellington, New Zealand LONG TERM PLAN HASTINGS DISTRICT COUNCIL // 33

36 Mayor Sandra Hazlehurst Councillor Tania Kerr (Deputy Mayor) Councillor Bayden Barber Councillor Ann Redstone Councillor Rod Heaps Councillor Malcolm Dixon Councillor Wendy Schollum Councillor Simon Nixon Councillor Damon Harvey Councillor Geraldine Travers Councillor Henare O Keefe JP Councillor George Lyons Councillor Kevin Watkins Councillor Jacoby Poulain 34 // HASTINGS DISTRICT COUNCIL LONG TERM PLAN