A number of residents have emailed councillors asking for a referendum on the government’s proposed 3 Waters reform. This is how I replied to them:
Just by way of quick re-cap on Hutt City Council actions to date. When last year the four new water service entities were proposed, we had legal advice that as a Council we could not ‘opt in’ or ‘opt out’ on such a crucial issue without formal consultation with our residents. We waited to see the final form of the proposals so that we could do that consultation, and perhaps even hold a referendum. Then came the disappointing news the government had decided to make the reforms mandatory.
Officers have told me a rough estimate to hold a referendum in Lower Hutt is $185,000 – or $50,000 if we did it as part of the local body (postal vote) elections in September/October. Given that even if a referendum showed substantial majority opposition to the 3 Waters reform in the Hutt, the government is NOT going to change its mind, I don’t really see the point of such expenditure. (HCC has already ran a consultation exercise in April/May which drew 774 responses – 46% opposed to the new ‘mega’ water entities; 38% in support; 16% neutral/don’t know.)
In could be argued that the ‘referendum’ that really matters on the 3 Waters reforms will happen with next year’s general election. The National Party has said a number of times it will repeal and replace the government’s reform legislation.
What Hutt councillors can do in the meantime is put in a strong submission to the current Select Committee process hearing the Water Services Entities Bill suggesting improvements. We’re debating that this week, before the July 22 submissions deadline, and if you have suggestions or feedback I’d love to hear it (simon.edwards@huttcity.govt.nz)
In reality, a submission that just says “we’re against it”, without saying what would be better, will be ignored.
My major concern with the Hutt being put into ‘Entity C’ is the gross dilution of local accountability and the ability of residents to have a direct and meaningful say in water infrastructure investment and priorities. I would rather have seen an expanded Wellington Water set-up to get on to the backlog of necessary infrastructure upgrades and retention of that closer accountability. However, the information from the Water Infrastructure Commission Scotland (peer reviewed by two international accounting firms) was that the quantum of savings from economies for scale are best achieved by four new entities of the size proposed.
Quick thoughts on three aspects of the reforms (and again, open to your feedback):
“They’re stealing ratepayers’ assets”. Are our reservoirs, treatment stations and many hundreds of kilometres of (ageing, leaking) pipes really assets (other than in terms of book value, and the ability to borrow against) given that pretty much NOBODY is in favour of selling/privatizing 3 Waters infrastructure? There are very strong safeguards now built in to ensure Entity C cannot sell the infrastructure it will take over (all 22 councils under Entity C would have to unanimously agree, and that would need to be followed by a referendum of citizens and a 75% majority in favour).
Co-governance. I am in favour of the principle of one person, one vote and I believe representatives on key public bodies should be elected, not appointed. But I also believe in our partnership under the Treaty of Waitangi, and that Maori have a special interest in water quality issues. People will make up their own minds on whether it is fair that a section of society comprising 17% of our population will have 50% representation on the 3 Waters Regional Representation Groups. For my part I don’t feel it is a big issue in this case – after all, iwi/Maori are just as interested and invested in keeping the cost to families of running these 3 Waters entities to what is affordable.
Lastly, the challenges ahead. There is a risk Lower Hutt residents could end up subsidizing other regions in Entity C with more significant water issues than ours – the Wairarapa and East Coast’s water shortages/droughts, for example. But equally, they could end up subsidizing the Hutt.
Just to give you a feel for the HUGE 3Waters costs facing our city:
60% of our pipes are due for renewal in the next 30 years (we’ve budgeted $532 million over the next decade)
The Department of Internal Affairs has forecast that over a 30-year period, $3.02 billion of 3 Waters capital investment in Lower Hutt will be needed (our own officers believe that’s too high)
Revised sea level rise estimates mean underground infrastructure in Petone and other low lying areas could be threatened much earlier than anticipated – perhaps within 20 years.
We’ve budgeted $200 million for a replacement Seaview wastewater treatment plant in the 2030s. Not only could that be a significant under-estimate, but we may need to do the project earlier, and with climate change we may not be able to rebuild in Seaview.
Whatever your view on 3 Waters, I think we can agree that ‘doing nothing/the status quo’ will badly backfire on us in the years ahead.
While it’s surprising – and very welcome – to see Labour and National look past the usual political manoeuvering and show co-operation on a thorny issue, their recent announcement on housing density has significant downsides for the Hutt.
Can’t fault the motivation behind the Resource Management (Enabling Housing Supply and other Matters) Amendment Bill. By any account, we’re tens of thousands of houses short in New Zealand and sky-high accommodation costs are a drag on the economy and many Kiwis’ lives.
An example of new infill housing near the Waterloo Interchange enabled by Hutt City Council’s Plan Change 43. Now the government has ordered councils to allow for three 3-storey housing density anywhere in the city.
The bipartisan proposed new legislation will allow three 3-storey homes on any residential property in most of our cities ‘as of right’ (i.e. no resource consent or hearing needed), and an easier subdivision process. There are controls – for example, buildings can only cover 50% of the property – but side and rear yards need only be 1-metre from boundaries.
Modelling by PwC predicted the new rules could enable an additional 48,200 to 105,500 new homes being built nationally in the next five to eight years.
The proposals are additional to earlier rules that are also compulsory for ‘tier 1’ councils like the Hutt’s to introduce. The National Policy Statement on Urban Development requires us to allow ‘as of right’ buildings of at least six storeys within “walkable distance” of the central business district, Petone and train stations.
This NPS-UD is the same direction that removes the ability of councils to require any new developments to provide off-street parking.
We need to allow for housing density. As we grapple with climate change (particularly a need to ‘mode shift’ out of cars) and the cost of 3Waters infrastructure, it makes sense not to keep expanding urban areas further and further into productive rural land.
That was precisely the thinking behind Hutt City Council’s Plan Change 43. Ushered in late 2019, and clearing final appeals early this year, it has enabled much of the surge of infill housing in the Hutt of late. It was a bold, and bitterly-criticised-by-some, move. But it was also targeted.
The Medium Density developments allowed under PC43 (height up to 10m; 60% site coverage), were restricted to zones in eight areas chosen for their proximity to shops, schools, public transport and parks. Other provisions in Hutt City Council’s District Plan encourage inner city living apartments in the CBD and in tandem with the exciting Riverlink development, and flats/townhouses built on top of retail in suburban shopping areas such as Waterloo and Avalon/Park Ave.
Now central government has clod-hoppered in with blanket rules. Instead of our nuanced approach, focusing developers’ attention on areas well served by shops and public transport, from August next year infill can happen anywhere in the city.
And a big concern for neighbours – preserving sunlight – has been dealt a significant blow. HCC’s Plan Change 43 Medium Density stipulates a recession plane of 3.5m + 45 degrees (meaning the side of the house can only be 3.5m tall before it must slope – helping reduce shading of the adjacent property). But now overriding that will be the government’s new rule – a recession plane of 6m + 60 degrees.
While there are potential exceptions to the new three houses of 3-storeys per site rules (e.g. to manage impacts in heritage or natural hazard areas) the word from our planning experts is that these exceptions will be tightly controlled.
With the government’s decision to make the 3Waters reform mandatory, the public consultation promised for next year seems redundant. It may be that New Zealanders will only get a definitive say on this major change to provision of drinking water, stormwater and sewerage services at the 2023 general election.
Local Government Minister Nanaia Mahuta is preparing to introduce legislation setting up four new publicly-owned water service entities, each serving roughly 1.2 million people. National and ACT have both pledged to repeal any such legislation.
There is a select committee process early next year – another chance for opponents to fire broadsides at the claimed savings from moving to these four mega water entities and the loss of direct local control for residents via their territorial authority. Minister Mahuta has agreed to set up a working group comprised of Council and iwi representatives to try and shape a better model of governance and accountability.
[The governance proposal as it stands is convoluted. Lower Hutt and 21 other Councils that would become part of Entity ‘C’ get to nominate six representatives to a representation group. A similar number of Iwi/Mana Whenua groups from the top of the South Island and as far north as Gisborne, nominate another six members. That board appoints a selection panel, which in turn appoints a board of experts to run Entity C. So for Hutt ratepayers via their council, that’s a 1/44th say on the board that appoints another board.]
As it panned out, Hutt City Council never got the chance to ‘opt in’ or ‘opt out’. Our clear legal advice was that we could not make such a major decision without full consultation with residents. The consultation never happened because the government made the changes mandatory anyway.
I’m very aware a large number of local residents are deeply concerned, even angry, about the idea of $500 million of local pipe, reservoir and treatment plant resources built up by generations of Hutt ratepayers being handed over to this new entity, even if the entity remains in public ownership. It should be noted it is very, very unlikely any of these entities or their assets could be sold off into private hands. It would require a 75% majority vote by the representation board AND a 75% majority vote in favour by residents across the area served.
It’s also worth saying that although the Hutt’s water infrastructure has a book value of half a billion dollars, is it realistic to describe these as assets? Assets generally are things that have a value when sold. There is no intention to sell these assets. Given the huge cost to upgrade and maintain those pipes and reservoirs, is it just as sound to describe them as liabilities we have to have to deliver essential services?
The government and three sets of reviewers put the case that economies of scale, ability to attract and retain expert staff and other factors will deliver significant savings as we stare down an future investment requirement nationwide of up to $185 billion.
The ballpark estimate of the cost of water services to the average Lower Hutt household with the reform is $1260 a year by 2051; without the centralization of services, we’ll each pay nearly double at $2,380. However, another financial reviewer (Castalia) has hotly disputed this quantum of savings. HCC officers’ advice is that while we could argue about the quantum of savings from reform, the general thrust of scale efficiencies are sound.
Whoever you believe – make no mistake, there are VERY considerable 3Waters costs in front of Lower Hutt, with or without reform.
60% of Lower Hutt’s water infrastructure needs to be replaced in the next 30 years.
Our Long-Term Plan budgets $587 million to double water infrastructure investment between now and 2031. That’s a major reason behind the 5.9% rates increase this year, and the proposed rates increases of 5.9% next year and 7.2% the year after.
Pipe renewals and other related work is estimated to cost $2.1 billion between now and 2051, and importantly, that doesn’t factor in city growth (all the extra housing we’re seeing being built).
That’s also not counting meeting much tougher new government rules on discharge of contaminants into waterways during times of high rainfall (and the large fines liable for breaches).
The water and stormwater infrastructure in Wainuiomata, where so much housing growth is happening, is at capacity now. CBD stormwater is also at capacity now.
While we expected to gather up to $37 million in development fees from developers of new housing in the next 10 years as a contribution to the ‘growth component’ of infrastructure, actual costs may be be many times that.
Hutt City Council’s debt (with Riverlink, and if the new Cross Valley Connector road gets sign-off) is tipped to nudge $600 million by 2029 – still well within our self-imposed prudent debt to revenue limit of 250%, but an eye-watering amount of money.
The new water entity would assume all of those responsibilities going forward, and is said to have the asset base and separate balance sheets to enable debt to revenue leverage of 645%.
But the big questions remain:
Where would Hutt’s priorities sit within that much larger entity?
And while local rates bills should be significantly smaller given we’ll be turning over all those responsibilities, $109 million of existing water infrastructure-related debt (but also $71m of annual revenue), what sort of bills can local people expect to get in the future from Entity C?
They can cause huge harm to those individuals (and their families) caught in the addiction grip of the flashing lights and hope of prizes. But unfortunately they’ve also become a staple revenue source for many community groups and sports clubs.
We’re talking pokies – or to give them their official description, class 4 (non-casino) electronic gaming machines.
As required by legislation, Council is reviewing its Gambling and Board venue policy. There’s information and an on-line survey available. The submissions deadline is 10 November.
In the 2015 review of class 4 gambling machines the Hutt City Council of the day put a cap on the then total number of pokies (545) and set a limit of nine machines in any new venue. Currently we have 425 pokies in 28 venues in Te Awakairangi/Lower Hutt but more than 90 of those gaming machines are in the poorest parts of Lower Hutt.
A report from the NZ Institute of Economic Research found that even with this reduced number, Lower Hutt has 4 electronic gambling machines per 1000 people; the national average is 2.9.
Gambling machine profits (GMP – or total money fed in, minus prize payouts) was $25.6m million in 2020 in the city. That’s $69,500 per day, the fourth highest level of GMP of any region in New Zealand.
The NZ Health and Lifestyles Survey 2016 found about 10 per cent of Kiwis report they participate in class 4 gambling (55% bought Lotto tickets; 11% bet on horses, greyhounds or other sports events). If that’s true for the Hutt, the average per person for feeding money into pokie machines here is around $1600 a year. But given a higher proportion of pokie machines in Te Awakairangi are in high deprivation suburbs, and using that same 10% participation figure, the average spend for households in those parts of the city could be as high as $173 a week.
There are three options going forward:
The status quo
A ‘sinking lid’ (no new gaming machine licences granted, no transfer of licences, no merger of venues, support from council to problem gaming service providers), or
A per capita approach, lowering the cap on machines to 325 and 25 venues, bringing us into line with the national average.
Some of the numbers above are truly horrifying but, as with many issues, there are two sides to the story. The law requires pubs with pokies to return 40% of machine profits by way of community good grants (clubs such as the Petone [Working Men’s] Club can retain that money to fund community good purposes within their operation).
Many clubs and community organisations will tell you that grants from pokies trusts are pretty much the only revenue stream that keeps them solvent, or enables upgrades and equipment purchase. If pokies grant money declines over time, what will replace it?
And is there a risk that if access to pubs with pokie machines is made harder, more people will turn to on-line gambling – which pays no community dividend at all and has no supervision for gambling harm.
There are other issues that weigh in for Hutt City Council and the demand on ratepayers.
Council owns the building that is now home to the Naenae Bowling Club and the covered rinks that attract regional and national tournaments. Ratepayers stumped up millions to establish this excellent facility. The club derives $85,000-$105,000 revenue from its nine pokie machines. It could be argued it would by hypocritical of council to clamp down on pokies because of the harm they cause, but keep running nine of them in one of its own facilities. But if we insist the club ditches those nine machines, will rates money have to make up that $85k-$105k lost revenue?
It’s also proposed as one of the options that our team that looks after alcohol off and on-licences extend its duties to monitor premises with pokie machines to ensure that gambling harm reduction requirements are being carried out. That’s an added expense on council resources. It’s also suggested we may support providers offering gambling harm services – more expense for ratepayers in a field that some might argue is the responsibility of central government health authorities.
What do you think?
Fill in the on-line survey. I chair the Policy, Finance and Strategy Committee and we’ll be making recommendations to full council at our November 16 meeting. I’d appreciate hearing your views direct – simon.edwards@huttcity.govt.nz
We’d thought as councillors that rolling out recycling bins with wind-clip lids, and ensuring every household had affordable access to a rubbish bin to limit recyclables contamination, might be our biggest decision this triennium. But that looks like being eclipsed by looming three waters reform.
You’ve probably heard the government proposes four new entities to take over responsibility for drinking water, wastewater and stormwater services (3Waters) currently provided by 67 councils. The Hutt would be part of yet-to-be more imaginatively named ‘Entity C’, taking in the top of the South Island, the Wellington region and the east coast up to Gisborne.
It’s estimated that to renew 3Waters infrastructure, cope with population increase and conform with much stricter environmental limits on waterway pollution will cost Kiwis up to $185 billion over the next 30 years.
In Hutt City alone, 60% of our pipes, reservoirs, sewers, etc., will need to be renewed by 2051 (cost $2.1b). Rates have gone up this year, and will continue to outpace inflation in the medium term, in large part because we’ve budgeted to double 3Waters infrastructure investment to $587m over the next 10 years.
Other councils are in a similar – or worse – cost predicament. Government-commissioned reports found that through economies of scale, costs would be around 45% lower by 2051 than if there was no reform. In a Hutt context, instead of an average local household paying an estimated 3Waters bill of $2,380 in 2051 the cost would be $1,260.
Some hotly dispute these savings estimates.
Other factors also intrude. 3Water debt would come off Councils’ books, freeing up borrowing capacity for things such as housing and transport improvements, but we’d also be turning over assets built up by generations of Hutt residents (in our case, infrastructure with a ‘book value’ of $500m).
There’s a $2.5b ‘transition package’ on offer, including $500m to compensate any council financially worse off from the change, but this has been criticised as insufficient. Nevertheless, the sweetener dangled in front of Hutt residents for a reforms ‘yes’ is $38.7m, with payments starting July 2022 onwards for projects that improve residents’ ‘wellbeing’.
Keep your eye on Council’s website, and the 8 September Council meeting, when more financial detail are to be presented.
There are any number of unanswered questions, including:
* Will urban areas be subsidising rural communities? It would appear so from government estimates. * How can it be guaranteed the new entities will remain in public ownership, when a future government can change legislation? * What are the future impacts of surrendering current control by democratically elected councils to a board appointed by six council and six iwi representatives from across the entire ‘Entity C’ region?
Councils do not have to decide whether they are ‘in’ or out’ by 30 September, but are asked to suggest improvements that would help get reforms across the line.
It would be entirely unreasonable for a council to give a yes or no commitment without full community consultation. And frankly for that to happen more information is needed from the government and more time needed for in-depth discussion. There may even be a case for a referendum if consultation feedback is divided.
By coincidence or not, the submissions deadline is the same day Minister Nanaia Mahuta will report back on local government reforms. We may yet find, with a number of Councils indicating they’re against the 3Waters proposals, the government makes them mandatory.
What do you think about this? I’d be very interested to hear your views, or try and answer your questions. Leave a comment on this post, or Email: simon.edwards@huttcity.govt.nz
Hutt City Council’s Long-Term Plan is out. This is the blueprint – and budgets – that will guide Council spending for the next decade. While the LTP is reviewed every three years, from now until May 6 is your best chance to have a say on whether your think we have the priorities right. (Click here for the consultation document.)
There are several key – and expensive – projects included in the LTP:
Do we go for a new Naenae pool that duplicates what we already had but with a number of improvements, including climate-friendly heating technology that will reduce annual operational costs (this pool complex would cost up to $68 million), or do we go for a more basic pool complex (at $54 million)?
Is Hutt City’s share of the Riverlink project – at an estimated nett $97m – still affordable? NZTA Waka/Kotahi is responsible for the new Melling interchange, and Greater Wellington Regional Council (to which we all pay rates, of course) is responsible for the estimated $125 million of floodway upgrades. Hutt ratepayers are up for the costs of the promenade, pedestrian paths and cycleways (including the bike/walk bridge over Hutt River to the new Melling railway station) and the way the interchange and stopbanks integrate with the city edge.
At an estimated $15m-$20m, is rejuvenating Petone wharf the right thing to do?
There’s plenty more information, and the chance to have your say, on these and other topics – here.
What’s the rates impact?
To cut to the chase on the Long-Term Plan – what will your rates bills look like if current proposals are unchanged?
For the average residential property valued at $629,000, this would be a rates increase in the financial year beginning 1 July 2021 of $130 per annum, or $2.50 per week.
More than half of that $130 increase – $72 – is related to 3Waters (drinking water, sewage, stormwater).
City debt is projected to triple during the decade, from today’s debt of about $200 million to a peak of just under $600 million.
Most of Lower Hutt’s water infrastructure was built in the 1930s and 1950s. Some 60 per cent of the water network needs to be renewed over the next 30 years at a cost of $2.1 billion (inflation adjusted).
The increasing rate of water leaks over the past few years is one indication of the deterioration of the network. For the six-month period July to December 2020 there were 1,457 leaks – nearly twice the 754 leaks reported for the same period in 2019. We’ve seen what happens with catastrophic failure of major infrastructure in Wellington City (raw sewage in Willis St).
Over the 10-year period of the Long-Term Plan, our proposal will see us invest a total of $582M in 3Waters improvements. That’s $325M more than the equivalent period in previous LTP.
How did we get to this state of affairs/massive backlog? Successive councils share the blame, in my opinion. For well over a decade we’ve taken pride in the fact our rates increases have been some of the lowest in the country (inflation + 1%) – as confirmed by the Productivity Commission report on council financing. In regard to 3Waters infrastructure, the approach has been ‘this is the fiscal envelope, work within it’. Wrong, in hindsight. The approach should have been what it is now: ‘What money is needed to prudently do the maintenance/replacement work required?’
Complicating things further is that the comprehensive nationwide water reform process – Taumata Arowai – is in its early stages, and there is still uncertainty around its likely impact on Council, such as the transfer of assets.
On the rates topic, there are also questions in the consultation document on differentials – essentially how to best share the rates burden between residential and commercial ratepayers. Council is proposing phasing in over the next three years a small shift back on to commercial ratepayers.
Knowing your Pipes – infiltration and sewage spills
Before we finish with pipes, there’s another topic to discuss that potentially could cost you thousands of dollars.
The city has a major issue with stormwater infiltration. This is where, in times of heavy rainfall, stormwater gets into our sewerage network, overwhelming the treatment and storage tank systems. We end up having to spill some of this overflow into the Hutt River and harbour. Not only is this environmentally unsound, with the government’s National Policy Statement Freshwater, we’re not likely to continue to get consent to do it.
Infiltration on private property happens mainly because of damaged/broken pipes, or because stormwater from roof guttering is (unwittingly or deliberately) directed down into sewerage gully traps.
Last year Hutt City Council put aside $250,000 with Wellington Water to set up a dedicated investigation crew to inspect residential properties for these incorrect/illegal pipe connections. The team is currently active in Wainuiomata, but will in time turn their attention to other parts of the city.
As these infiltration issues are on private property, the remedial cost is on the homeowner. In can amount to many thousands of dollars to rectify.
For that reason, councillors have just approved an extension to our rates postponement policy that will enable householders facing infiltration repairs to spread the cost over a number of years, paying it off by a targeted rate in their rates bill. The minimum payment per year will be $500 and council’s cost of interest will also be charged. Read the paper to councillors, here. Page 189.
Learning to share the footpath
Recently in Auckland, a Lime e-scooter rider was been ordered to pay reparation of $4000 after hitting a woman as she got off a bus. This is how Stuff reported the incident.
From time to time Hutt City Council is asked – ‘why don’t you just ban e-scooters from our footpaths’. The answer is, even if there was agreement that was the right thing to do, we don’t have the power to do it.
The rules around footpath (and road) use are determined by central Government, not by Council. These rules are documented in the Land Transport (Road User) Rule 2004.
The rules include that motor vehicles and cycles are not allowed to ride along the footpath (although the rules for cycle use are being looked at).
It also allows users of wheeled recreational devices and mobility devices to use the footpath so long as they operate in a ‘careful and considerate manner’ and ‘must not operate at a speed that constitutes a hazard to other footpath users’.
The same rule requires that a pedestrian must not ‘unduly impede the passage of a mobility device or wheeled recreational device permitted to use the footpath’.
The rule therefore suggests that footpaths are in fact shared spaces and that all legitimate users need to be aware of other users and behave appropriately. The Lime scooter rider in Auckland was found against, and costs ordered, because the man should have anticipated people getting off the bus as he passed, and should have reduced his speed.
Proposal to re-zone golf club land
Boulcott’s Farm Heritage Golf Club is to pursue a private plan change that could see 1.6 hectares of land currently zoned ‘general recreation’ near Kingston and Allen Streets re-zoned for housing.
The club has told council it has no immediate intentions of developing the area, and in the short term would continue to operate the golf course on its current footprint. However, the increase in value of the land from the zoning would allow the Club to borrow more to cover its operations.
This is separate to last year’s decision by the Environment Court to allow Summerset to build a $150 million retirement village, including one four-level and one-five level buildings – on land bordering Boulcott’s Farm Heritage Golf Club. Read more here.
Last chance for say on heritage policy
Council is currently out for a final round of consultation on its draft Heritage Policy – Taonga Tuku Iho. Submissions close Friday April 9.
The major point of contention is likely to be whether private dwellings with heritage attributes can be added to the list of buildings protected under our District Plan without the permission of the building’s owner/s. A previous council policy (2012) – that private dwellings could only be added to the District Plan heritage schedule with the written permission of the owner/s – has not been carried forward into the new proposed policy.
Read more here. As with all topics raised in this newsletter, I’d be very pleased to hear your thoughts to help guide me when it comes time to make decisions. (Email simon.edwards@huttcity.govt.nz).
Apartments proposed in heritage Waterloo Rd fire station
Hutt City Council is once again on track to exceed 1,600 building consents in the financial year. Up to the end of the 2nd quarter it had granted 946 building consents with the value of work of $251m, compared to 890 consents to value of $205m for the same period in the last year.
One of the more interesting consent applications received relates to 155-157 Waterloo Rd. The distinctive 1955-built fire station, which has a Heritage New Zealand category one listing, has been empty since 2007.
Flats have recently been completed behind it, and the consent application (stage 1) includes partial demolition of the interior and seismic strengthening. The internal fit-out for apartments will be lodged in a separate building consent application.
Notable resource consents lodged:
· 124 Richmond Road, Petone – Redevelopment of the site previously occupied by Imperial Tobacco to create 95 townhouses
· 221 High Street, Hutt Central – Conversion of commercial building in the CBD to apartments at rear and above
· 4 Collingwood Street, Waterloo – 11 townhouses; comprising a mixture of 1, 2 and 3 bedroom units
· 123 Cambridge Terrace, Fairfield – 11 townhouses; comprising a mixture of 1 and 2 bedroom units
· 65 Victoria Street, Alicetown – Demolition of an earthquake prone block of flats and redevelopment of the site for 6 dwellings.
· 1 Stokes Valley Road, Stokes Valley – Corner site at the entrance to Stokes Valley to be developed for 5 dwellings
As locals debate the pluses and minuses of infill houses popping up everywhere in the city, a common refrain is the pressure this puts on our creaking infrastructure. There are grumbles that current ratepayers will have to fork out big money for the upgrades to pipes and roads that all this growth will require.
So it’s timely to inject the topic of ‘Development Contributions’ into the discussion. Our proposed Long-Term Plan includes some pretty hefty hikes in these contributions and Council is looking for people’s feedback.
For example, you’ll see from the table below that it’s proposed the fee put on developers per ‘equivalent housing unit’ (EHU) in Wainuiomata would go up by $18, 550 but in Eastbourne would actually drop by $8,283. More on why later. (Note: 1 EHU = demand placed on infrastructure by 1 nominal household. For example, a 225m2 industrial development = 1 EHU for water and stormwater. A formula differential will be used to calculate the development contribution for a smaller residential unit, such as an apartment.)
First, what’s a development contribution (DC)? All sorts of sections of the Local Government Act 2002 relate to DCs but the guts of its is this: the capital cost of providing growth-related infrastructure can be funded by a charge on developers of new housing and commercial buildings. Principles relating to fairness and equity, simplicity, certainty and transparency and consistency must be applied.
Hutt councillors propose that 100% of the capital costs of growth-related water, wastewater, transport and stormwater infrastructure should be liable for DCs. We’re not proposing it applies to reserves and community facilities, which is also possible under the legislation.
Council is anticipating that just over $74 million of the estimated $506 million we’ll spend on the 3Waters and roading in the next 15 years will come from development contributions. That’s a big chunk of money that would otherwise fall on all ratepayers, were projects to proceed at the scope and size projected.
Development contributions can be levied on future growth capital expenditure (up to 30 years), and the interest cost of debt incurred to fund those assets. But DCs are not allowed to be used to fund operating and maintenance costs, nor can they be charged to pay for the component of pipe and road upgrades that need to be done even if there was no growth in the particular suburb or ‘catchment’.
So why are the proposed DCs going up in some parts of the city, and down in others? Quite simply, it’s related to where the infill/new housing is happening most, compared to where it was happening the last time our DCs were reviewed, and thus where pressure is on infrastructure. Very little growth-related infrastructure is planned for Eastbourne, for example, but to cope with fast-rising population growth Wainuiomata needs a third reservoir ($43m) extra fire flow pipe upgrades ($6m) and the need to pay for its share of projects such as the main outfall sewer renewal ($196m) and sludge dryer renewal at Seaview sewage treatment plant ($44m).
Quite a bit of growth is also happening on the Valley floor, which is why DCs in that catchment are to go up by $8,923 to $12,851.
Depending on what you tell us during Long-Term Plan consultation, the average DC across the city will be $5,454 – an increase of $1,886.
If you’ve stuck with the article so far, the huge downside of raising development contributions has probably also occurred to you. Is this the thing to do right when we’re in the middle of a housing affordability crisis?? Developers won’t pay these DCs out of the goodness of their hearts; they’ll be passed on to the buyer of the house or apartment.
Three points to ponder on that front.
1/ Lower Hutt’s current DCs are comparatively low compared to many cities. These proposed changes bring us more in line with what similar sized councils charge.
2/The highest charge (Wainuiomata’s) equates to around 4% of the median house price in the city, or just 10% of house price increases over the last five years.
And 3/ the alternative is that all ratepayers shoulder the burden of the component of infrastructure costs related to growth, when they’ve already paid/are paying for existing infrastructure debt.
Your call.
Have your say on this topic, as well as rates projections and plans for other projects in our city as part of Long-Term Plan consultation, running until May 6. Click here. (The section on development contributions starts on page 78 of the consultation document.)
Last Sunday (Nov. 8) marked 500 days since Hutt City Council declared a ‘climate change emergency’. We’ve made progress on a number of fronts but if we want to accelerate action on projects to reduce greenhouse gas emissions/boost resilience ahead of sea level rise, etc., the next few months are important.
Councillors are debating priorities for the Long-Term Annual Plan (2021-2031), which goes out for public consultation March-April next year. Any significant future spending needs to be budgeted for. We know Council will have to significantly increase our investment in 3 Waters infrastructure (stormwater, drinking water, sewerage), and there’s a risk that will squeeze out other priorities.
A report released in June this year shows that gross greenhouse gas emissions (GHG) dropped by 11% across Lower Hutt between 2001 and 2019 and there has been a 19% drop in emissions on a per capita basis. But much more effort is needed by our city – and the rest of New Zealand – if we’re to achieve net zero carbon emissions by 2050. Leaving it all to latter decades makes the task progressively more difficult.
One of the new fully electric rubbish collection trucks that will begin kerbside collections in Lower Hutt from next July. This one is a smaller vehicle, for the narrower roads of hill suburbs.
Lower Hutt contributed 13% of the Wellington region’s total gross emissions. Transport continues to be the biggest source of emissions in our city, comprising almost 56% of total gross emissions. Electricity and gas consumption is the second largest emitter at around 31%.
Take a look below at what’s been achieved so far/is being worked on. Is it enough? What are the gaps? What other climate change initiatives would you like to see Hutt City Council tackle? Please add your suggestions in a comment below, or email me – simon.edwards@huttcity.govt.nz).
TRANSPORT
Under the new waste and recycling contract just announced, from July next year half the fleet of trucks running kerbside collections will be electric (100% EV by 2024). The move to one contract will mean there will be fewer collection trucks on the road. 957 tonnes of carbon emissions will be avoided each year for the 11 EV trucks that will be on the road in July 2021 equating to the annual emissions of 473 cars or flying 7,500 people from Wellington to Auckland.
Council’s vehicle fleet has been reduced by eight vehicles, to 72, thanks to pooling, analysis of trip trends, and electric bikes being available for shorter trips.
Fourteen vehicles (19% of the fleet) are now fully electric and the roll-out of 15 fleet charging stations is complete, catering for future EV growth.
To encourage more residents to make the switch from petrol and diesel vehicles, as part of Long-Term Plan considerations councillors will consider an option to invest around $300,000 in extending the network of public EV charging stations to locations outside libraries, swimming pools, hubs and at other strategic locations in suburban centres. Revenue from charging fees could be re-invested in further additions to the network, based on demand.
Under a mandatory directive from government, developers of any new building no longer have to provide off-street parking. We are also required by the government to allow for housing intensification (buildings of six storeys or more) around railway stations.
Air travel – Council is monitoring use of air travel by staff, with a view to reducing it. In light of the increased use of remote video conferencing such as MS Teams and ZOOM since the emergency of COVID-19, it is possible that future air travel emissions will be significantly lower than in the past.
CYCLEWAYS
Around 50% of the city’s carbon emissions comes from vehicle use. We have huge health problems arising from obesity and lack of physical activity, and costs of petrol, car buying, repair and insurance add to debt spirals. That’s why the Council is investing heavily in safer cycleways to encourage our residents to leave the car behind whenever they can.
The Wainuiomata Hill Shared Path cost $12.3m, with HCC paying $5.2m and the rest covered by Waka Kotahi/NZTA. It’s getting a lot of use.
We have a similar cost sharing arrangement with Waka Kotahi for the $7 million ‘Beltway’ central and northern sections. The Beltway is an off-road 2.5m wide shared path now taking shape along rail corridor land between Waterloo Interchange and Wingate. A southern section from Waterloo to link with the Wainuiomata Hill Path is still at design stage.
With 90% funding from the government, we’re also running a trial of cycle/micromobility lanes on either side of Knights Rd from the interchange to Bunny St. This is due to open in the first quarter of 2021. Other cycleways to link the Beltway with schools, the hospital and the river trails are in planning stages.
We intend more than doubling spending on footpath upgrades, and smoothing gutter crossings at street corners to make it easier not just for those using wheelchairs, scooters, mobility scooters and prams, but also for our elderly pedestrians.
In August this year, the government announced it would inject $15 million of ‘shovel ready’ project funding into our $28.7m Eastern Bays Shared Path. Long in the planning but delayed because of the growing cost, the 4.4 km path will run along Marine Drive in two sections: between Point Howard and the northern end of Days Bay, and the southern end of Days Bay (Windy Point) to Eastbourne (Muritai Road/Marine Parade intersection). The design will include seawall improvements designed to push back waves during storm events. Work is expected to start early in 2021 and continue through until 2026.
Council is supporting a new ‘Free Rides’ bike scheme in Naenae. Read more, here.
The first 10 ‘recycled’ bikes in the Naenae ‘Free Ride’ initiative.
BUILDINGS
An Energy and Carbon Reduction Plan 2020-24 now in place. The aim is a a 30% reduction in carbon emissions at Council’s facilities (gas and electricity used in libraries, halls, pools, hubs, etc) by 2024.
Officers are finalising business cases for switching Eastbourne, Huia and Stokes Valley Pools from gas to electric heat pump technology. If we can avoid needing to replace or upgrade the existing gas meter at Huia pool, and install a heat pump, operational cost savings could be in the order of $38,000 per year, with cuts to emissions of about 200 tonnes of carbon dioxide (CO2) per year.
We installed an after-hours cover over the main outdoor pool at Petone’s McKenzie Baths at the start of the 2019/20 summer. Estimates of savings of 233,100 kWh ($16,600) and 51 tonnes of carbon dioxide per year (reducing that pool’s carbon emissions by about 60%) are on track.
Work is also under way regarding the business case for a pool cover at Wainuiomata pool, potentially saving up to 60tonnesCO2e per season.
For the new Naenae Pool + Fitness Centre we’re investigating low carbon heating options and the use of the NZ Green Building Council’s GreenStar building rating tool.
Council has included in the Statement of Intent for its property company, Urban Plus, that all new housing units it builds from July 1 this year have a Homestar (insulation, etc) design rating of at least six stars.
LANDFILL
Council owns Silverstream landfill, where some of the methane (a potent greenhouse gas) from rotting organic matter is captured for use in a gas to electricity-generation plant.
Unfortunately, the landfill’s 2020 calendar year emissions will likely be significantly higher than previous years, possibly up to 30,000 tCO2e. This is because of disruption to plant operations in the first half of 2020, in turn caused by disruptions associated with the change of ownership of the power plant from Pioneer Energy to LMS Energy, and LMS Energy’s inability to enter NZ as a result of COVID-19 restrictions.
To better cater for any such future disruptions, and to capture a great level of the methane that escapes the collection system for the gas to electricity plant, a flare is to be installed at the landfill – hopefully before the end of 2020 – to burn off excess methane. This would help Council avoid future ETS liabilities, and a side benefit is improved odour control at the landfill, with cost savings.
On a region wide basis, investigations continue on the optimum way to collect/compost organic waste and green waste from households. Any initiative is more likely to be cost-efficient if it’s done on a regional scale, though community composting trials are also taking place in Wellington.
In collaboration with other councils, Hutt City has a waste minimisation portal at www.sortwaste.nz, which aims to bring together resources to enable residents to make more informed decisions, including ways of minimising organic waste going to landfill.
GENERAL
A Zero Carbon Plan for Lower Hutt is being worked on, in a ‘co-design’ process with the community.
As part of the Council website update, new pages are to be added on climate change, including actions that Hutt households can take to reduce their own environmental footprint.
With every project and paper put in front of councillors for decisions, an assessment of climate change impacts must be provided (just the same as assessments on any financial or consultation requirements).
Climate change issues are likely to be front and centre as we get underway with a total review of the District Plan over the next 2-3 years. One of the debates is likely to be on whether we should continue to allow development of areas prone to sea level rise, and impacts of more frequent storm/flooding events. There will be ample opportunity for public input.
Our new Energy Advisor, co-funded by the Energy Efficiency and Conservation Authority, initially for a two year pilot period, has already identified immediate cost savings. By adjusting energy tariffs payable at various facilities, Council will avoid $50,000 in annual costs. As well, some unnecessary power connections have been shut down, avoiding a further $12,000 in annual costs.
We’re exploring carbon forestry opportunities for our reserve land. Our application to formally register the first batch of land in native recovering forest in the East Harbour Regional Park was successful. Work is now under way to assess the formal eligibility, and register other forest land owned by Council. GWRC is pursuing a plan to re-forest parts of the Belmont Regional Park currently leased for livestock grazing.
A Councillor climate change working group has been formed to sprear-head future initiatives and keep the topic in front of the council as a whole. Terms of reference – here.
This is one of the most difficult decisions of the triennium, with many competing factors.
We should be guided by the core issues – protecting our environment, offering our residents the most cost-effective rubbish and recycling services we can, reducing waste and preserving the lifespan or our landfill, which when it eventually is filled will cost many, many millions of dollars to replace.
Using the economies of scale of a city-wide contract, a rates-funded weekly or fortnightly collection can cut rubbish collection costs for our residents by up to half of what they currently pay. The other big dividend is that it ensures all of our residents, including Kainga Ora tenants and our less well-off families, have access to an affordable rubbish service. Logic says when they have an appropriately sized wheelie bin for their rubbish, there will be far less tendency for our recycling collection to be contaminated.
The proposed changes to our recycling are surely a no-brainer. But whether Hutt City Council should expand its role in rubbish collection, or just leave it to the market, is far less clear cut.
The two kerbside collection systems are connected. A key issue for me is the risk of contamination of the new recycling wheelie bins by people putting rubbish in with their plastic, paper/cardboard and tins. If there is more than 10% of non-recyclables picked up on a collection round, the whole truck-load goes to the tip. We thus fill up expensive landfill space and defeat the environmental gains.
