Agenda of Regional Council Meeting

HAWKE’S BAY REGIONAL COUNCIL

Wednesday 08 June 2011
Thursday 09 June 2011
Friday 10 June 2011

SUBJECT: Submissions on the Draft Annual Plan 2011/12

REASON FOR REPORT

1. The purpose of this paper is to outline the process to be undertaken to hear and consider submissions received on the draft Annual Plan 2011/12.

Background

2. The draft Annual Plan 2011/12 was publicly notified in local media between 26 and 30 March 2011 and was available from 6 April 2011 for public consideration as required by the Local Government Act 2002.

3. The availability of the Plan was notified in The Big Picture, through local media and was available on Council's website, from 6 April 2011. Copies of the draft Plan were distributed to:

3.1. All local authorities in the region

3.2. Environmental groups

3.3. Interest groups

3.4. Iwi groups

3.5. Members of Parliament and Government Ministries

3.6. Public Libraries

3.7. Other Regional Councils

3.8. Persons on the Council's mailing list who have previously requested a copy of Council’s Annual Plans or received a copy of the 10 Year Plan.

4. A requirement of the Local Government Act 2002 is to have a Summary of the Plan. This Summary was included in the April 2011 issue of The Big Picture and distributed to approximately 56,000 households in the region, during the week of 12 April 2011.

5. Four public meetings were held during April to promote the draft Annual Plan and encourage submissions.

6. Submissions closed at 5.00pm on Tuesday 10 May 2011 Submissions were acknowledged and copies of all submissions were distributed to Councillors on Friday, 13 May 2011.

7. This year, Council received 46 submissions, 36 of the submitters expressed a wish to verbally submit to the Council.

8. Copies of the Staff responses to submissions were sent to each of the submitters and all Councillors on Friday, 27 May 2011.

9. In recent years, Council received the following number of submissions in relation to Annual Plan / 10 Year Plan:

9.1. 135 submission (Annual Plan 2010/11 – 57 ordinary submissions, 78 water charges submissions)

9.2. 119 submissions (10 Year Plan 2009-19)

9.3. 49 submissions (Annual Plan 2008/09)

10. The procedure for considering submissions will be that Council:

10.1. Hears all verbal submissions as per the attached timetable, and Council’s internal submission

10.2. Considers each submission, bearing in mind the verbal submissions made in support of the written submissions and staff responses to submissions which have already been distributed to all Councillors

10.3. Resolves any changes to be made to the draft Annual Plan 2011/12 based on the decisions made on submissions from the general public, and the Council’s internal submission.

11. Subsequent to Council’s decisions on the submissions, the draft Annual Plan will be revised to incorporate the necessary amendments. Council will then adopt the final Annual Plan on 29 June 2011.

12. Following the adoption of the Plan on 29 June 2011 each submitter will receive a letter from Council setting out Council's resolution pertinent to their specific submission, and the reasons for the resolution.

13. The final Annual Plan will be distributed within one month of the date of adoption as required under Section 93 (10) of the Local Government Act 2002.

DECISION MAKING PROCESS

14. Council is required to make a decision in accordance with Part 6 Sub-Part 1, of the Local Government Act 2002 (the Act). Staff have assessed the requirements contained within this section of the Act in relation to this item and have concluded the following:

14.1. Sections 83 and 84 of the Act set out the requirements of the Act where special consultative procedure applies with consideration of the draft Annual Plan 2011/12.

14.2. The issues to be considered in this paper are those issues raised by members of the community that have submitted to the Council on the Annual Plan. All submissions are an integral part of the special consultative processes set out in Section 83 and 84 of the Local Government Act 2002.

RECOMMENDATIONS

That Council:

1. Agrees that the decisions to be made on issues submitted on the draft Annual Plan 2011/12 are made after the provisions included in Section 83 and 84 of the Local Government Act 2002 have been followed.

2. Receives and considers the verbal and written submissions.

Paul Drury

Group Manager

Corporate Services

Attachment/s

1 View

Submission Timetable

Submission Timetable

Attachment 1

Draft Annual Plan 2011/12 – Verbal Submissions Timetable Wednesday, 8 June

Time	Sub #	Details

9.00		Meeting Commences
9.15	13	Michael Bassett-Foss
9.30		Consideration of Acceptance of Late Submission
9.45	20	Ashley Jevon-Dalgaard
10.00	42	Colin Stone
10.15	12	Adrienne Campbell
10.30		*Morning Tea*
10.45	26	William McCook
11.00
11.15	18	James Hunter
11.30	19	Scott Lawson
11.45	21	Kevin Mitchell
12.00	9	Denis O’Reilly
12.15
12.30
12.45		*Lunch*
1.00
1.15	15	Tom Belford
1.30	2	Dr Jim Samson
1.45
2.00	41	Derek Williams
2.15	1	Jana Ohlirova
2.30
2.45	5	Mirabel Brooks
3.00		*Afternoon Tea*
3.15	25	Angela Hair
3.30	22	M Kirkwood
3.45	45	Lawrence Yule/Ross Mc Leod
4.00		Meeting concludes

Draft Annual Plan 2011/12 - Verbal Submissions Timetable Thursday, 9 June

Time	Sub #	Details

9.00		Meeting Recommences
9.15	35	Michelle Wade – Cape Coast Community Group
9.30	36	Dick Frizzell - WOW
9.45	10	Jock Mackintosh
10.00	11	Ros Stewart
10.15	34	David George
10.30		*Morning Tea*
10.45	24	John Springfield
11.00	29/30/33	John Hamilton/Kate Worsnop/Brian Setter
11.15
11.30
11.45	28	Diana Triplow
12.00	40	Diane Vesty
12.15	46	Paul Trass – (late submission) To be Confirmed as Accepted by Council
12.30
12.45		*Lunch*
1.00
1.15
1.30	38	Ken Crispin
1.45	39	Sue Taafe
2.00	8	Dr Joseph Te Rito
2.15	6	Brian Chambers
2.30	44	Dr Nick Jones
2.45
3.00		*Afternoon Tea*
3.15	7	Brent Linn
3.30	23	Neil Grant/Benjamin Reddiex
3.45
4.00		Meeting concludes

Draft Annual Plan 2011/12 - Verbal Submissions Timetable Friday, 10 June

Time	Sub #	Details

9.00		Meeting Recommences
9.00
9.15
9.30
9.45
10.00
10.15
10.30		*Morning Tea*
10.45
11.00
11.15
11.30
11.45
12.00
12.15
12.30
12.45		*Lunch*
1.00
1.15
1.30
1.45
2.00
2.15
2.30
2.45
3.00		*Afternoon Tea*
3.15
3.30
3.45
4.00		Meeting concludes

HAWKE’S BAY REGIONAL COUNCIL

Wednesday 08 June 2011
Thursday 09 June 2011
Friday 10 June 2011

SUBJECT: Staff Internal Submission to the 2011-12 Annual Plan

REASON FOR REPORT

1. This report sets out a number of items that, in the opinion of staff, require inclusion in the final Annual Plan 2011/12.

Comment on Issues

2. Included in this paper are items of expenditure that are recommended to be carried forward from 2010/11 to 2011/12 as they represent expenditure on projects that will not be able to be completed during the 2010/11 year but will require funding in the 2011/12 year.

3. The approach taken in this paper is to cover the items under each of the Council’s groups of activities. Set out in Attachment 1 to this paper is a summary of the financial impacts of the items that are included in the staff recommendations.

Groups of Activities

Strategic Direction

Project 874 – Strategic Partnerships – Third Party Funding

4. Seek $120,000 of Third Party Funding to be carried forward from 874-001-2395 (Contributions). This funding is specifically targeted at the Hastings airshed and for the purposes of upgrading to clean heat. The allocation has yet to be fully taken up.

Effect on Plan

5. There is no effect on public good funding through this carry forward request of $120,000 as the funding for this initiative comes from the Sale of Land Non-Investment account.

Recommendation

6. That Council approves the carry forward in Project 874 001 (cost code 2395) of $120,000 from 2010/11 to 2011/12 to cover costs associated with the continued conversion of housing to clean heat in the Hastings airshed, noting that funding is from the Sale of Land Non-Investment account.

Project 874 – Strategic Partnerships – Iwi Funding

7. Seek $40,000 of Iwi Funding to be carried forward from 874-001-2395 (Contributions). The full allocation of funding has not been taken up in the 2010/11 financial year but significant expenditure may occur around the establishment of the Regional Planning Committee and the training requirements for the non-councillor members. This fund would be available for that and other related purposes.

Effect on Plan

8. An increase in public good funding for Project 874 of $40,000 in 2011/12 funded from unexpended funds in 2010/11 year.

Recommendation

9. That Council approves the carry forward in Project 874-001 (cost code 2395) of $40,000 from 2010/11 to 2011/12 to cover costs associated with the development of tangata whenau decision-making capacity.

Project 185 – Investment Strategies

10. During 2010/11 Council provided funding for preliminary advice on the establishment of an Investment Company, provision of taxation advice and provision of legal advice.

11. As Council will now not be considering whether to adopt the proposal to establish an Investment Company until 29 June 2011, much of the set up work will now be deferred until the 2011/12 year. It is therefore proposed to transfer $27,000 from 2010/11 to 2011/12 to provide funding for this work.

Effect on Plan

12. An increase in public good expenditure during 2011/12 for Project 185 of $27,000 funded from unexpended funds of $27,000 in the 2010/11 year.

Recommendation

13. That Council approves the carry forward in Project 185-001 (cost code 2380) of $27,000 from 2010/11 to 2011/12 to provide funding for the consultancy input required to complete the interface between Council and the Investment Company subsidiaries and to fund the initial set up of the Company.

Project 192 – Regional Planning

14. This project contains salary budget ($80,000) for one full time equivalent that has not yet been recruited. This position is for a senior policy planner to drive plan changes for the Tukituki River and Karamu catchments. We have been unable to recruit an appropriately senior and experienced planner. Given the urgency associated with developing plan changes both in terms of the consents which expire in May 2013 and in terms of the Ruataniwha water storage project, we are now engaging suitably qualified and experienced consultants to undertake this work.

15. The proposal is still being scoped at the time of writing but it is likely to be in the order of $120,000 in total.

Effect on Plan

16. A net increase in public good funding for Project 192 of $40,000 in 2011/12.

Recommendation

17. That Council approves the additional funding of $40,000 in Project 192 001 (cost code 2380) to engage consultancy services to undertake policy planning covering the Tukituki River and Karamu catchments.

Regional Resources

Project 314 - Water Demand Management

18. Seek $25,000 to be carried forward from 314 003 2380 which relates to the Regional Water Values Study. This project will extend and build on the existing River Values Assessment System (RiVAS) decision-making support tool. Primary focus will be on establishing processes and tools that are capable of balancing various value sets used in decision-making.

19. This project is covered under Project 192 in 2011/12, and the carry forward should go into that project.

Effect on Plan

20. An increase in public good funding for Project 192 of $25,000 in 2011/12 funded from unexpended funds in 2010/11 (Project 314).

Recommendation

21. That Council approves the carry forward in Project 314 003 (cost code 2380) to Project 192 010 (cost code 2380) of $25,000 from 2010/11 to 2011/12 to cover costs associated with the development of the Regional Water Values Study.

Project 314 - Water Demand Management

22. Seek $20,000 to be carried forward from 314 002 2380 which relates to the Regional Water Demand and Availability Strategy. This project is a critical element of Council’s overall Water Strategy. It is a three year project with 2011/12 being the third year.

Effect on Plan

23. An increase in public good funding for Project 314 of $20,000 in 2011/12 funded from unexpended funds in 2010/11.

Recommendation

24. That Council approves the carry forward in Project 314 002 (cost code 2380) of $20,000 from 2010/11 to 2011/12 to cover costs associated with the completion of the Regional Water Demand and Availability Strategy.

Project 385 – Regional Park Reserves (Cycleways)

Landscapes Ride

25. The Clifton to Te Awanga and Haumoana to Moore Road sections of the ride were completed by December 2010. The Red Bridge to Moore Road section was due for completion by 30 June 2011 but this work is now delayed due to prioritising machinery to assist in flood clean up responsibilities. The Red Bridge to River Road section is also held up due to landowner and compensation negotiations that are ongoing but nearing resolution, with work expected to follow the Red Bridge to Moore Road works in the New Year.

Water Ride

26. All negotiations have now been completed for this ride and approximately 50% of the ride is expected to be built by the end of the financial year. The remaining section of the ride is intended to be completed by October 2011, subject to weather and ground conditions.

27. The total cycleway was budgeted at $4.1 million, funded from $2.6 million Government Grants and $1.5 million loan funding. It is estimated that only $2.0 million will be spent during 2010/11, with the remaining $2.1 million being spent in 2011/12.

Effect on Plan

28. There is no effect on public good funding through this carry forward request of $2.1 million as this is funded by way of $1.6 million in Government Grants and $500,000 of loan funding.

Recommendation

29. That Council approves the carry forward in Project 385 003 (cost code 2395) of $2.1 million from 2010/11 to 2011/12 to cover the costs of the Landscapes and Water Ride Cycleway Developments, noting that this expenditure is funded $1.6 million from Central Government Grants and $500,000 from loan funding.

Project 385 – Regional Park Reserves (Other Open Space Projects)

30. The 2010/11 Plan provided for $1.0 million, funded from loan funding, to be set aside for the funding of Open Space projects. This provision has not been used to date as there have been no projects within Open Spaces have been approved by Council this year.

31. It is anticipated that a number of Open Space projects will be submitted to Council for funding in the 2011/12 year and accordingly it is requested that this $1.0 million be carried forward to assist with the funding of these projects.

Effect on Plan

32. There is no effect on public good funding through this carry forward request of $1.0 million as this is funded from loan funding.

Recommendation

33. That Council approves the carry forward in Project 385 051 (cost code 2650) of $1.0 million from 2010/11 to 2011/12 to provide funding for future Open Space projects, noting that this is funded from loans.

Transport

Project 790 – Subsidised Passenger Transport

34. A sum of $76,000 was provided for in the 2010/11 budget to construct bus shelters in Napier and Hastings. The construction of these bus shelters has been postponed until 2011/12 at which time it is proposed that a new bus shelter facility be built in Hastings at Russell Street (Kmart facility) to coincide with the development of Nelson Park. The construction of bus shelters in Napier has been deferred until new routes have been introduced and demand for shelters is known.

Effect on Plan

35. The $76,000 requested to be carried forward from 2010/11 to 2011/12 for the construction of bus shelters is funded $38,000 through rates and $38,000 from the New Zealand Transport Association (NZTA). This carry forward does not affect Council’s general funding position as scheme reserves and NZTA revenue are amended.

Recommendation

36. That Council approves the carry forward of expenditure in Project 790 001 (cost code 2385) of $76,000 from 2010/11 to 2011/12 to provide funding for the construction of bus shelters. It is noted that $38,000 will be amended in the scheme reserve for subsidised transport and $38,000 will be amended (in revenue code 1250) for NZTA revenues.

Governance and Community Engagement

Project 840 – Community Representation & Regional Leadership

37. An efficiency and reorganisation study covering Local Government in the region was proposed in the 2009/10 Plan and $50,000 was set aside in that Plan to fund such a study. This $50,000 was carried forward by Council into the 2010/11 year and it is proposed that as this fund is still not spent, that it be carried forward to the 2011/12 year.

Effect on Plan

38. An increase in public good expenditure during 2011/12 for Project 840 of $50,000 funded from unexpended funds of $50,000 in the 2010/11 year.

Recommendation

39. That Council approves the carry forward in Project 840 001 (cost code 2380) of $50,000 from 2010/11 to 2011/12 to provide funding for efficiency and effectiveness studies in relation to Regional Council activities.

Project 840 – Community Representation & Regional Leadership

40. Council has allocated $20,000 during 2010/11 to the development of a publication commemorating the rich history accumulated over 150 years of settlement in the Hawke’s Bay region. It is proposed that the publication will highlight the region by drawing attention to various treasures held within the archives. Council’s own role in the fabric of Hawke’s Bay’s history would also be illustrated within this publication.

41. The Hawke’s Bay Museum and Art Gallery (HBMAG) is committed to researching and developing the publication, however has not been able to start the project this financial year due to preparing the collection for short term storage. HBMAG has committed to begin the production of the publication in the next financial year, so it is requested that the provision of $20,000 be carried forward to 2011/12. It is anticipated that the launch of the book will be at a major exhibition in 2013.

Effect on Plan

42. An increase in public good expenditure during 2011/12 for Project 840 of $20,000 will be offset by a reduction in cost during 2010/11 year.

Recommendation

43. That Council approves the carry forward in Project 840 001 (cost code 2385) of $20,000 from 2010/11 to 2011/12 for the development of a publication commemorating the 150 years of settlement in the Hawke’s Bay region.

Project 893 – Regional Infrastructure

44. On 25 November 2009 Council approved a contribution of $2.5 million to the Velodrome at the Regional Sports Park (payable during 2010/11 and 2011/12) and a contribution of $2.5 million to the Hawke’s Bay Museum and Art Gallery project (payable during 2010/11 and 2011/12). Accordingly in the 2010/11 Plan, $1.25 million was provided to be paid for the Velodrome and a further $1.25 million to be paid for the Hawke’s Bay Museum and Art Gallery.

45. It is intended that the payment to the Museum and Art Gallery be paid during the 2010/11 year, however given that the Velodrome will not be proceeding, it is requested that $1.25 million relating to the Sports Park be carried forward to the 2011/12 year so that this sum is available to Council to assist with the funding of projects to be identified during that year.

Effect on Plan

46. There is no effect on public good funding through this carry forward request as the $1.25 million to be carried forward is funded $400,000 from the Sale of Land Non-Investment account and $850,000 of loan funding from the $7.5 million loan funding for capital projects of regional significance.

Recommendation

47. That Council approves the carry forward in Project 893-001 (cost code 2395) of $1.25 million from 2010/11 to 2011/12 to provide funding for regional projects within the 2011/12 year, noting that this expenditure is funded $400,000 from the Sale of Land Non-Investment account and $850,000 from loan funding.

Project 874 – Assistance for Rugby World Cup

48. Council has approved assistance of $330,000 for the Rugby World Cup (RWC) event. The reason for this assistance being provided was in recognition that the RWC is a global event which will give Hawke’s Bay the opportunity to showcase itself to a global audience and demonstrate to visitors what an exciting, vibrant place Hawke’s Bay is.

49. During 2009/10 $100,000 was paid to Venture Hawke’s Bay (VHB) for this promotion. During 2010/11 a sum of $230,000 ($100,000 grant and $130,000 loan) was provided for; however it is estimated that only $80,000 will be drawn down during this year. Accordingly, the remaining $150,000 is required to be carried forward to 2011/12 in order to assist in the funding of the promotion of the RWC to be held in October 2011.

Effect on Plan

50. All payments under this assistance programme are to be funded through the Sale of Land Non-Investment account, therefore the funding of $150,000 requested to be carried forward from 2010/11 to 2011/12 will be funded from funds not spent in that account during the 2010/11 year.

Recommendation

51. That Council approves the carry forward in Project 874 001 (cost code 2395) of $150,000 from 2010/11 to 2011/12 to assist with the promotion of the Rugby World Cup event, noting that this expenditure is funded from the Sale of Land Non-Investment account.

Project 877 – Specific Regional Projects

Hawke’s Bay Cultural Trust Earthquake Exhibition in Napier Museum

52. Council originally put aside $100,000 from this reserve in March 2005 to provide funding for the Earthquake exhibition. A payment of $50,000 has been made towards the Earthquake display, leaving a balance of $100,000 (including accrued interest) at 30 June 2011. This balance needs to be carried forward into the 2011/12 year to assist with the funding of the earthquake display in the new Museum building.

Effect on Plan

53. An increase in expenditure during 2011/12 for Project 877 of $100,000 (including accrued interest) to be funded from the specific regional project scheme funds which will now not be spent during 2010/11.

Recommendation

54. That Council approves the carry forward in Project 877 001 (cost code 2395) of $100,000 from 2010/11 to 2011/12 for the funding of further upgrades to the earthquake Museum display planned as part of the new Museum building project.

Cost Centre Adjustments

Provision for Insurance

55. Council’s material damage policy covers buildings and contents with a claim limit of $28.9 million. This policy has an excess of $10,000 per event. The premiums for this policy are shown below.

Year	Premium
2007/08	$48,000
2008/09	$47,000
2010/11	$27,000
2011/12	$50,000

56. The Draft Annual Plan includes a premium of $27,600 for material damage insurance, however subsequent to the earthquake in Christchurch, the Council has received advice that the insurance premium will increase to approximately $50,000. It is therefore requested that a further $22,400 be set aside in the budget for material damage insurance.

57. There will also be pressure on the premiums charged for Council’s infrastructure insurance. This insurance covers assets of approximately $100 million in the event of damage incurred through disasters. Presently Council insures with the Local Authority Protection Programme (LAPP) to cover 40% of the risk and, with commercial insurers for 60% of the risk (please refer to Mr Adye’s paper to the Asset Management and Biosecurity Committee meeting on 11 May 2011). Staff are currently in discussions with LAPP and commercial insurers re the premiums to cover infrastructure damage for the 2011/12 year, and it is intended to bring a paper to the 29 June 2011 Council meeting which deals with the issue of increased premiums and the approach to insurance re LAPP/commercial insurance coverage.

Effect on Plan

58. The general funded deficit will increase by $22,400 in 2011/12.

Recommendation

59. That a further sum of $22,400 be set aside in the 2011/12 budget to cover the increased costs of Council’s material damage insurance, noting that the reason for this increase is due to the increased costs of reinsurance brought about because of the Christchurch earthquake, increasing New Zealand’s risk profile.

Capital Expenditure Adjustments

Purchase of Coastal Monitoring Buoy

60. In 2009 Council approved Capital Expenditure of $60,000 to purchase a coastal monitoring buoy to complement the state of the environment near shore coastal water quality monitoring and climate programmes. In 2010 Council successfully gained funding through Envirolink to seek expert advice on buoy arrangement and set-up from Dr Paul Barter of the Cawthron Institute.

61. The Cawthron Institute has recently installed a coastal monitoring buoy in Tasman District, and has used this experience to support advice to Hawke’s Bay Regional Council. A meeting to discuss options and written advice is expected in June/July 2011.

Effect on Plan

62. There is no effect on public good funding through this carry forward request as the $60,000 to be carried forward is funded from the Asset Replacement Reserve.

Recommendation

63. That Council approves the carry forward of Capital Expenditure of $60,000 from 2010/11 to 2011/12 to allow for the utilisation of advice from the Cawthron Institute prior to purchasing equipment.

DECISION MAKING PROCESS

64. Council is required to make a decision in accordance with Part 6 Sub-Part 1, of the Local Government Act 2002 (the Act). Staff have assessed the requirements contained within this section of the Act in relation to this item and have concluded the following:

64.1. Sections 83 and 84 of the Act set out the requirements of the Act where special consultative procedure applies with consideration of the draft Annual Plan 2011/12.

64.2. The issues to be considered in this paper are those issues raised in Council's internal submission on the Plan. All submissions are an integral part of the special consultative processes set out in Section 83 and 84 of the Local Government Act 2002.

RECOMMENDATIONS

That Council:

2. Receives and considers the Council’s internal submission.

Heath Caldwell

Management Accountant

Paul Drury

Group Manager

Corporate Services

Attachment/s

1 View

Summary of Financial Impact of Internal Submission Recommendations

HAWKE’S BAY REGIONAL COUNCIL

Wednesday 08 June 2011
Thursday 09 June 2011
Friday 10 June 2011

SUBJECT: Clarification of Funding Available for Open Spaces / Community Facilities

REASON FOR REPORT

1. To provide for Council, clarification of the setting up of the $7.5m borrowing facility for capital projects of regional significance, also the policy and criteria for open space projects and the policy and criteria for the Community Facilities fund. This paper will also cover the draw downs to date against the $7.5m loan facility and will provide information on the Sale of Land (Non-Investment) account.

Background

2. At the Council meeting on 25 May 2011 Council considered an Open Spaces investment update and requested further information on the funding available for open spaces and community facilities be provided for Council’s clarification and consideration at the Council meetings covering Annual Plan submissions.

Establishment of the $7.5m Loan Funding – Council Meeting 6 March 2008

3. At the Council meeting held on 6 March 2008 Council resolved:

3.1. “Approves provision of up to $7.5m loan funding for public good capital projects of regional significance that align with Council’s strategic purposes, servicing of this loan to be funded from the Sale of Land (Non-Investment) reserve.

3.2. Approves the annual transfer of funding to the Sale of Land account (Non‑Investment) reserve from the Sale of Land (Investment) reserve, such sum to be equivalent to 1% of the value of the Napier leasehold land portfolio at the commencement of each budget year. It is noted that reports from Council valuers have established that increases in the Napier leasehold land values are estimated to be between 2% and 3% over the rate of inflation during the next 10 years.”

4. The section of the Council paper submitted to Council on 6 March 2008 that gave rise to the above resolutions is appended as Attachment 1 to provide Council with the main drivers and logic for establishing this fund. These background papers explain that the initial purpose of this facility was to provide funding of regional parks/open spaces.

5. The 2008/09 Annual Plan identified the establishment of the $7.5m borrowing facility for capital assets of regional significance and the allocating of funds equivalent to 1% of the net value of the Napier leasehold land portfolio into a fund used for investing in capital assets (such assets being non-dividend yielding assets) of regional significance, as one of the key issues for special consultation.

Adoption of Open Space Investment Policy – Council Meeting 25 June 2008

6. At its meeting on 25 June 2008 Council resolved:

6.1. “Approves the policy on Open Space investment for use by Council in evaluating proposed investment opportunities.”

Appended to this paper as Attachment 2 is a copy of the Open Space policy as adopted at that meeting.

7. At the 25 June 2008 Council meeting the funding for the Open Space investment opportunities was proposed to be the borrowing facility previously approved of $7.5m.

8. Council has approved the following Open Space projects for funding from the $7.5m borrowing facility.

Project	Amount
Weka study	$30,000
Te Mata Trust Board contribution	$25,000
Contribution Te Mata Trust Board (capital)	$50,000
Tukituki River and nutrient wetland development	$226,000
Clifton Beach concrete removal	$49,000
Tutira study	$15,000
New Zealand cycleway and trail project	$1,500,000
Total	$1,895,000

10 Year Plan 2009-19 – Strategy for Providing Funding for “Regional Infrastructure”

9. Council included in this Plan, a strategy for the funding of contributions to regional infrastructure, the excerpt from the “Right Debate” section of the Draft 10 Year Plan is set out below:

Regional Infrastructure
Our Proposal	Significant regional public infrastructure such as sports parks and museums are important for a vibrant region. The region will not develop and prosper without strategic support in assets and activities that promote community wellbeing. Council has received requests of $3 million for the Regional Sports Park, $1.5 million for the Hawke’s Bay Museum upgrade, $500,000 for the Waipawa Town Hall project and $200,000 funding for the Rugby World Cup 2011. The Rugby World Cup is estimated to cost $620,000 for hosting of cup matches and events in Hawke’s Bay and will be part funded from ‘in kind’ contributions from Hastings District, Napier City and Hawke’s Bay Incorporated and contributions from sector groups. In this Ten Year Plan, Council has tentatively put aside $3.7 million as a contestable fund for such projects over the first three years of the Plan and pending further assessment.
The Cost	The estimated cost of this programme to Council is $3.7 million.
Funding	$2.7M Council reserves $1.0M loan funding.
Other Options	Council could make the decision not to contribute to these projects or to contribute more.
What do you think?	Do you think the Council should set aside $3.5 million for the sports park, museum, town hall and other publicly owned infrastructure projects and regional significance projects, and $200,000 for funding for the Rugby World Cup. What do you think Council’s role is in relation to social infrastructure? Should the provision of grants continue?

10. This Draft Plan setting out the proposal to assist with infrastructure development, along with the possible projects that could be included for funding was part of the special consultative process for the 10 Year Plan.

11. The Final 10 Year Plan adopted on 3o June 2009 increased the estimated cost of the programme to $10.4m of which $2.5m was planned to be spent in the first three years of the 10 Year Plan.

Adoption of Community Facilities Fund Policy – Council Meeting 22 September 2009

12. At the Council meeting held on 22 September 2009 Council considered a Community Facilities Fund policy which would assist Council in determining which applications for assistance covering regional infrastructure would be approved for funding. The adopted policy is appended to this paper as Attachment 3.

Approvals for Assistance – Community Facilities Fund – Council Meeting 17 November 2009

13. At the 17 November 2009 Council meeting Council received and heard submissions from Napier City Council, Hastings District Council and Central Hawke’s Bay District Council setting out their projects that they were requesting this Council to provide assistance for. Wairoa District Council provided a written letter requesting financial assistance for a specific project, rather than verbally presenting.

14. In view of the high value of the requested assistance, Council decided to proceed with approval of applications for assistance at the same time instead of continuing to review applications over the next three years. It was considered that there were large projects currently underway, eg the Regional Sports Park and Hawke’s Bay Museum and Art Gallery that needed commitments of funding at that time rather than delaying decisions.

15. The available funding for regional infrastructure was therefore increased from $3.7m (as per the first three years of the Draft 10 Year Plan) to $5.8m. The funding of this $5.8m was to be:

Item	Amount
Sale of Land (Non-Investment)	$2,000,000
Special Regional Projects Reserve	$500,000
Loan Funding	$3,300,000
Total	$5,800,000

16. The loan funding was to come from the $7.5m proposed borrowing for capital projects of regional significance.

17. Council approved the following projects which made up this $5.8m.

Item	Amount
2011 Rugby World Cup	$200,000
Waipawa Town Hall	$500,000	($500,000 loan funding)
Regional Sports Park	$2,500,000	($1,600,000 loan funding)
Hawke’s Bay Museum & Art Gallery	$2,500,000	($1,200,000 loan funding)
Hawke’s Bay Museum Earthquake Display	$100,000
Total	$5,800,000

Summary of the Current Position of the $7.5 Million Borrowing Facility

18. The fund was initially established on 6 March 2008 for the purpose of funding open spaces, however the name given to the borrowing facility was Capital Projects of Regional Significance.

19. In June 2008 Council adopted an Open Space policy to determine projects that would be funded from funding sources including the borrowing facility. Projects as specified above in this paper totalling $1,895,000 have been funded from this loan facility to date.

20. The Draft 10 Year Plan 2009-19 in the “Right Debate” section established a regional infrastructure strategy and that Plan established that $3.7m would be available for assistance for regional infrastructure for the first three years of the 10 Year Plan. This $3.7m was to be funded $2.7m from reserves and $1m from loans. (The Final 10 Year Plan reduced the three year fund to $2.5m).

21. On 22 September 2009 a Community Facilities policy was established in order that applications for assistance for regional infrastructure could be assessed by Council.

22. On 17 November 2009 Council heard submissions from territorial local authorities for use of the Community Facilities fund. Because of the high request level from these authorities, the funding available for community facilities (regional infrastructure) was increased from $3.7m to $5.8m over the first three years of the 10 Year Plan. The funding for the $5.8m was $2.5m from reserves and $3.3m from loan funding (note that the loan funding for community facilities was increased from $1m to $3.3m at this stage).

23. Loans drawn for community infrastructure amount to $500,000 for Waipawa and $450,000 for the Hawke’s Bay Museum.

24. Set out below is the current funding position for the $7.5m set aside for capital projects of regional significance – (NB: The amounts on the table below where the loan has already been drawn have been shaded).

Current Funding Position Reconciliation of Capital Projects of Regional Significance
Projection from 1 January 2011 (Revised 21 April 2011)

			Year 1	Year 2	Year 3	Year 4
			Actual	AnnPln	Forecast	Forecast
	Note	Prj	2009/10	2010/11	2011/12	2012/13
		#	($'000)	($'000)	($'000)	($'000)

Available Funding (Proj 485 Capital)			7,500	6,700	2,877	523
Projects CONFIRMED for Funding
Weka Study	1.	385		(30)
Contribution to Te Mata Trust Board	1.	385	(25)
Contribution to Te Mata Trust Board (Capital)	1.	385		(50)
Tukituki River Nutrient Wetland Development	1.	385	(226)
Clifton Beach Concrete Removal	2.	385	(49)
Waipawa Town Hall	3.	893	(500)
Regional Sports Park (Velodrome)	3.	893		(850)	(750)		#
Hawke's Bay Museum	3.	893		(450)	(750)
Tutira Study	4.	385		(15)
NZ Cycle Trail Project		385		(1,500)

			Year 1	Year 2	Year 3	Year 4
			Actual	AnnPln	Forecast	Forecast
	Note	Prj	2009/10	2010/11	2011/12	2012/13
		#	($'000)	($'000)	($'000)	($'000)

Projects PROPOSED for Funding
Open Space Provision		385		(1,000)	(1,000)		*
Wairoa Project ( to be identified)	N/A					(500)
Subtotals			(800)	(3,895)	(2,500)	(500)

Loan Repayments			0	72	146	275
Revised Projected Totals			6,700	2,877	523	298
# Project on hold
* Not specifically committed
Notes:
1. Refer to Council Meeting Held 9 - 15 June 2009
2. Refer to Council Meeting Held 26 August 2009
3. Refer to Council Meeting Held 25 November 2009
4. Refer to Asset Management & Biosecurity Committee Meeting Held 16 November 2010

25. The status of the $7.5m borrowing facility can be summarised as follows.

Details	$	$
Total Approved Facility		7,500,000
Loans already drawn down:
- Open spaces	1,895,000
- Community facilities	950,000
Total loans drawn		2,845,000
Total funding not drawn		4,655,000
Projects approved by Council that will require loan funding:
- Hawke’s Bay Museum (2^nd instalment)	750,000
- Regional Sports Park (Velodrome)	1,600,000
- Wairoa (project to be identified)	500,000
		2,850,000
Loan funding not drawn down or committed by Council resolution		1,805,000

Estimated repayments over the three years to 2012/13 that will be available for reallocation		493,000
Borrowing facility not committed		$2,298,000

Sale of Land (Non-Investment) Account

26. As established above in this paper, on 6 March 2008 Council resolved to fund the servicing costs for the $7.5m borrowing facility from the Sale of Land (Non-Investment) account. A decision was made at that meeting to provide an annual transfer of funding to the Sale of Land (Non-Investment) account of a sum equivalent to 1% of the value of the Napier leasehold land portfolio at the commencement of each budget year. This was supported by the valuer’s report that established that increases in Napier leasehold land values were estimated to be between 2% - 3% over the rate of inflation during the next 10 years. Transfers made to the Sale of Land (Non-Investment) account under this policy have been:

Years	Amount
2004/05	$500,000
2005/06	$500,000
2006/07	$500,000
2007/08	$500,000
2008/09	$970,000
2009/10	$881,000
2010/11	$907,000	(Estimate)

27. The following observations should be made in regard to continuing the transfers of these amounts to the Sale of Land (Non-Investment) account from the Sale of Land Investment Account:

27.1. The increase in valuations for Napier leasehold land for the five years from 30 June 2005 to 30 June 2010 was approximately 60%. The figure provided by Council’s valuers that annual increases over the long term would be between 2%‑3% on average over the rate of inflation, is consistent with the increases in valuations reported by them over these years. The transfer of 1% of the value each year to non-investment activities is still consistent with Council’s current policy and the underlying valuation data.

27.2. The financial projections currently under consideration by Council as part of their strategic planning include the transfer of funding from the Sale of Land (Investment) account to the Sale of Land (Non-Investment) account over the period of the 10 Year Plan 2009-19.

28. Appended to this paper as Attachment 4 is the current position of the Sale of Land (Non-Investment) account.

DECISION MAKING PROCESS

29. Council is required to make a decision in accordance with Part 6 Sub-Part 1, of the Local Government Act 2002 (the Act). Staff have assessed the requirements contained within this section of the Act in relation to this item and have concluded that, as this report is for information only and no decision is to be made, the decision making provisions of the Local Government Act 2002 do not apply.

RECOMMENDATION

1. That Council receives this paper, which sets out the background to the establishment of the $7.5m borrowing facility, the Open Spaces Investment policy, the policy for consideration of Community Facilities Fund applications, the current position of the $7.5m borrowing facility and the current position of the Sale of Land (Non-Investment) account.

Paul Drury

Group Manager

Corporate Services

Andrew Newman

Chief Executive

Attachment/s

1 View	Extract from 6 March 2008 Council Paper
2 View	Open Space Investment Policy
3 View	Proposed Policy for Consideration Community Facilities Fund Applications
4 View	Current Position - Sale of Land Non Investment Account

Extract from 6 March 2008 Council Paper

Attachment 1

Extract from Council Paper from

Meeting the Council Meeting on 6 March 2008

g) Sale of Land – Non-Investment Funds, Use for Regional Parks and Open Spaces

The purpose of this section is to address the issue of funding of regional parks / open space areas when opportunities for such investments present themselves to Council.

This paper proposes the use of the sale of land account (non-investment) reserve to provide this funding base. This is consistent with Council's adopted investment policy as included in the LTCCP 2006/16 and consulted on as part of that plan. This policy states:

6. Sale of Investments and Use of Proceeds for Other Purposes

The shareholding in Port of Napier Limited and other special purposes reserves which have been invested in various ways, have no flexibility to allow a sale or liquidation of any of these investments and a use of the funds for any other purposes than has been determined through the investment policy of Council.

However, in regard to Council's leasehold endowment property and other property, Council wish to retain the flexibility to sell some of these investments and to use the proceeds for purposes other than reinvestment in other investments. (Refer to Clause 1 page 10 for the definition of an investment.) These purposes will be restricted to capital related projects or interest free loans which may be at the instigation of Council or other organisations in the region. When proposing such a course of action, Council will, subject to the exceptions stated below, adopt a special consultative process under the Act which will allow a fully inclusive decision-making process with the Hawke's Bay community so as to extensively canvass their views and thoughts and seek their input into such proposals. There will be no requirement to carry out a special consultative process when:

i. Uses of sale proceeds of $50,000 or less are made for any one project; (Amended to $300,000 in the 2009-19 10 Year Plan)

ii. Council acquires land or enters into partnership for the development of further open space areas in rural settings and particularly those that are in environments that are of high ecological or landscape value or extensively used by the public.

It will be the objective of Council to indicate in either the Long Term Council Community Plan or the Annual Plan any proposals not covered by the exceptions above. There may be some occasions when the special consultative process surrounding such initiatives may not always coincide with these Council planning processes and so may occur as a standalone consultation exercise.

This non investment reserve as set up in the above-mentioned policy has the following characteristics as established in the 2004-14 LTCCP.

a. The reserve has two separate parts:

· Wastewater and other environmental initiatives. Council has lent to the Hastings District Council a total of $215,000 to assist the District Council to establish a reticulated wastewater treatment scheme in Waipatiki. The loan is interest free and repayable in five equal amounts of $43,000 per year commencing on 1 June 2007 with final repayment due on 1 June 2011.

· Other initiatives which include regional park/open spaces.

b. The source of funds for this reserve is a transfer of $500,000p.a. from the sale of land account (investment) which holds funds generated from the freeholding of Napier leasehold land.

There are two issues to be covered in this budget that cover the Sale of Land (Non Investment) Reserve funding for other initiatives :

1. Level of the funding transfer from sale of land (investment) reserve

The $500,000 which is currently transferred from this reserve was calculated at 1% of the net value of the Napier leasehold portfolio at the commencement of each Annual Plan year. A report from Telfer Young, dated 6 October 2004 stated that in the long term it was their assessment that the real land value increases (over and above inflation) would be 3.5% annually on average. Telfer Young have updated that report (3 July 2007) which states that increases in land value over the rate of inflation would be between 2% and 3.5% over the next 10 years.

The first transfer of $500,000 was for the 2004/05 year and was calculated as approximately 1% of the value of the Napier leasehold land portfolio which was $57.3M at the year end 30 June 2003. Therefore, this transfer of 1% ($500,000) was considered to be conservative in relation to the figures as presented in the Telfer Young reports.

The transfer value of $500,000 has not been altered and the 2007/08 Annual Plan has also assumed that $500,000 would be transferred even though the value of the Napier leasehold portfolio had increased to $92.4M at 30 June 2006.

The 2008/09 plan currently being considered by Council proposes to restore the transfer value to 1% of the value of the Napier leasehold land portfolio and accordingly, proposes that a sum of $970,000 calculated at 1% of the value of the Napier leasehold land portfolio estimated to be $97M at 30 June 2008 by Telfer Young.

2. Use of the funds available in the reserve

For Council to be in position to purchase land for regional park/open spaces then a funding source in excess of the balance held in the Sale of Land (Non Investment) Reserve will need to be available. This plan therefore proposes that loan funding be raised and serviced from the sale of land investment account balances.

The Annual Plan assumes that the transfer each year to this reserve will be based on 1% of the current Napier leasehold land portfolio, and given that assumption proposes that a loan of up to $7.5M could be raised to provide the funding needed for regional park/open space.

The Sale of Land (Non-Investment) Reserve would be used to service the annual interest and repayment on that loan. The supporting analysis for this reserve is included in the supplementary financial paper Section 5.

The raising of this $7.5million loan is in accordance with Council’s adopted liability management policy as contained in the 2006/16 LTCCP. This policy provides that Council can, by resolution, borrow for the following primary purposes:

· Funds for the acquisition of any assets expected to have a useful economic life in excess of two years;

· Funds for specific one-off projects;

· The acquisition of low risk investments;

· Short-term debt to manage timely differences between cash in-flows and out-flows and to maintain Council’s liquidity.

There is also the need to provide for future maintenance and operation of regional parks. The above $7.5M loan provides for the purchase and initial development. It is recommended in this paper that a further $100,000 per year from 2009-10 be set aside from the Sale of Land (Non-Investment) Reserve to cover this expenditure. Any funding in excess of the $100,000 will need to be considered at the time the Council looks at the total general funding needs of Council.

Open Space Investment Policy

Attachment 2

Contents

1. Background.. 2

2. Policy Outline.. 2

3. Evaluation Process.. 3

4. Open Space Investment Policies.. 4

5. Category 1 Priorities for Open Space.. 5

6. Category 2 Priorities for Open Space.. 6

7. Supporting Attributes for Categories 1 & 2. 7

1. Background

In 2007 the Hawke’s Bay Regional Council commissioned a review of the provision of public open space in the Hawke’s Bay. The resulting report (Hawke’s Bay Rural Open Space Study: Resource Assessment^{^[1]}) concluded that while the region has a number of public open spaces where the community can go to recreate, there are some gaps or limitations, particularly in the near-urban area and in respect of coastal access.

In consideration of the findings of this report, and having regard to the responsibilities and functions of the Council under Part 2 of the Local Government Act 2002 and Part 4 of the Resource Management Act 1991, the Council has determined that there is sound justification for the Council to be further involved in the provision of public open space to meet this and other demands. Council recognises that such spaces can be multi-purpose and can achieve a number of environmental, social and cultural outcomes.

It is, however, also understood that involvement in the provision of open space requires a clear identification and prioritisation of public open space requirements and for a policy to be developed to guide the Council in making these assessments – either in the active acquisition of areas of open space, or as opportunities come to hand.

The following policy document has been prepared on this basis.

2. Policy Outline

The aim of this policy is to identify the types of open space that are currently most needed in the region of Hawke’s Bay and provide a system of evaluation of potential sites that Council may in future consider purchasing or otherwise securing for public benefit.

The policy has two levels. The first of these describes open space that will be actively sought by the Council. That is, where the Council will take the initiative of actively investigating, finding and purchasing (or otherwise securing public access to) open space of the relevant description. This is referred to as ‘Category 1’ open space.

The second level is open space that will be passively sought by the Council. These are areas of open space that may be purchased or otherwise secured by the Council as opportunity arises and where a good deal may be on offer at the time. This are referred to as ‘Category 2’ open space and recognises that while there may be an active programme of procurement (seeking Category 1 open space) there also needs to be an ability to respond to unexpected situations and opportunities as they arise.

Category 1 priority open space is:

· Coastal space (with primary focus on strip access)

· Near Urban

· Ecological

· Aligned with HBRC’s Strategic Goals

Category 2 priority open space includes:

· Outstanding natural features (ONF’s)

· Lakes or other inland open waters

· River access

3. Evaluation Process

A three stage process has been developed to ensure efficiency and satisfaction of Hawkes Bay Regional Council objectives.

	Stage	Actioned by	Process
1	Policy categories	HBRC staff/ industry expert	Factual tests
2	Subjective evaluation	HBRC staff/ industry expert	Weighted assessment matrix
3	Approval	Strategic Committee/Council	Submit results of stage 1 and 2 evaluation

The first stage of evaluation for all candidate sites is to determine whether the proposed site fits the description of either Category 1 or Category 2 open space. Those categories are defined in Sections 5 and 6 of this policy and summarised in Table 1. In order to be considered further a site must fit one or other of these categories.

Having passed this test the next stage of assessment is to determine the degree of compliance and the extent to which the candidate site has other supporting attributes that would count in its favour. A list of 15 subjective attribute criteria are considered to be the essential determinates of a good investment opportunity. Each of the 15 criteria will be evaluated and a weighted assessment determined for each criteria. For this purpose a point-scoring system has been devised. The scoring system is as set out in Table 2. The total combined score (the sum of the scoring for all supporting attributes) is intended to provide a means of comparison between possible alternative sites. The supporting attributes are described in more detail in section 7. Set out below are the 15 criteria each having a score range of 1 – 5 (1= low, 5= high) and each criteria will be given a predetermined weighting which reflects the relative importance of each criteria with respect to the type of investment being sought by Council.

Key Attributes

1. Coastal access (proximity to a road-end)

2. Proximity to centres of population

3. Ecological value

4. Linkage to existing public open space

5. Water quality improvements

6. Recreational value

7. Cultural and Historical value

8. Camping potential adjacent to waterbodies

9. Partnership benefits (with TLA’s, DOC & community groups)

10. Environmental education opportunity

11. At risk environments (including ecological risk, flood risk)

12. Iconic value

Financial Attributes

13. Development costs

14. Maintenance costs

15. Other financial returns

16. Resale potential

Score	Result
< 60%	Decline
60% to 65%	Further Analysis
> 65%	Proceed

If the proposed investment has a score below 60%, once the projects contribution score is divided by the possible maximum score, the project will be discounted from further consideration. If the score is between 60 and 65% further specific analysis will be carried out on the project to determine whether any specific attributes scores can be reconsidered or if consideration of the financial commitment may improve the project scoring. Scores over 65% will proceed to the next stage of a more detailed investment analysis.

4. Open Space Investment Policies

Policy OS1: Council will provide financial resources and/or other assistance to actively identify and secure, for public access, use and enjoyment, such areas as described in this policy document as Category 1 Priorities for Open Space. Candidate sites must comply with one or more of the Category 1 criteria.

Policy OS2: Council will consider providing financial and/or other assistance for securing, for public access, use and enjoyment, such areas as described in this policy document as Category 2 Priorities for Open Space. Opportunities will be taken as they arise. Candidate sites must fully comply with one or more of the Category 2 criteria.

Policy OS3: All candidate sites shall be evaluated for compliance with relevant Category 1 or Category 2 criteria and evaluated against all of the criteria for Other Supporting Attributes.

5. Category 1 Priorities for Open Space

The following are Category 1 Priorities for Open Space:

5.1 Coastal open space – with focus on:

(a) Securing permanent legal foot access along the coastal margin where access is currently barred or impeded by natural obstacles and effectively requires all-tide passage over private land.

The Council’s primary focus is on providing strip-access. Larger park concepts are not a priority except where supported by other open space attributes described in this policy.

(b) Clarifying and asserting existing public access rights where these are currently unclear or in dispute. Legitimate public access to certain parts of the coast is currently prevented by some landowners claiming no right of access, and actively preventing access, despite cadastral evidence of the existence of paper roads or public reserves. Council will seek a negotiated solution in the first instance and focus on non-motorised access only.

(c) Safeguarding or re-locating existing coastal access where coastal erosion, landslides etc are threatening to make access no longer viable.

5.2 Near Urban – with focus on:

(a) Providing a near urban country park with multiple use opportunities. Park will be of a rural nature providing a minimum number of formal facilities.

(b) Containing a broad number of environmental aspects, such as water, wetlands, flora and fauna, wildlife habitat etc.

5.3 Ecological – with focus on:

(a) Land or property that has significant existing ecological values.

(b) Existing ecological values will be protected or enhanced by intervention.

5.4 Alignment with HBRC Strategic Goals – with focus on:

(a) Encompassing the open space and at least 2 other Council strategic goals.

(b) Provides for the concept of sustainability.

6. Category 2 Priorities for Open Space

The following are Category 2 Priorities for Open Space:

6.1 Outstanding Natural Features – where purchase would:

Permanently protect an officially recognised Outstanding Natural Feature (ONF) in circumstances where existing private ownership does not already provide adequate long term protection.

6.2 Lake or other inland open waters – that is:

(a) Within close proximity of a significant population base.

(b) Suitable for recreational activities such as water skiing, rowing and other such activities as are currently restricted to the lower Clive River and Wairoa River, as an example.

This may be in the form of an artificially created open water body.

6.3 River access

River access, throughout the Region, is already generally good. Providing for more public access to rivers is not a priority but opportunities for securing additional marginal strips and access may be taken up as part of existing council projects such as flood control and drainage schemes (as part of the Wairoa, Central and Southern Schemes).

7. Supporting Attributes for Categories 1 and 2

The following are other supporting attributes for Category 1 and Category 2 Open Space. All candidate sites must be evaluated against these supporting attributes in addition to relevant Category 1 / Category 2 criteria. A positive match with any of these attributes will be considered to add weight to the case for commitment to a candidate site.

The following are divided in to ‘Key Attributes’ and ‘Financial Attributes’

7.1 Key Attributes

The ideal site will:

(1) Have proximity to a road-end (for coastal land)

In the coastal area the places where additional public access will be most valuable is where the public can get to from an existing road end. Opportunities to create a loop-circuit are also important. As a guide:

· First priority is for sections of coastline within 2 km of a road-end, especially where the route allows two road-ends to be linked, or where a loop-circuit is created.

· Second priority is coastline within 4 km of a road-end (especially between road-ends or on a return-loop).

· Third priority is coastline greater than 4 km from a road-end.

(2) Have proximity to a centre of population – with preference for:

As first priority: Areas that can be visited in the course of a 1 – 3 hour total excursion time (including return car travel and on-site activity). These excursion times should be measured from regional centres and weighted on a population basis. This weighting favours proximity to Napier-Hastings (122,000 popn), secondly CHB (13,000 popn) and thirdly Wairoa (9,000 popn).

As second priority: Areas that can be visited in the course of a 3 – 5 hour total excursion time. Same population-based weightings apply.

(3) Contain sites of ecological significance – specifically:

Regionally significant habitat for vulnerable or endangered species of native plants, animals, fish or insects, (as supported by Recommended Area for Protection (RAP) status and/or classification in the IUCN Redbook Listing of Endangered Species) in situations where the on-going viability and/or recovery of the habitat or target species will be better served by public ownership than through continued private ownership of the site.

(4) Provide linkage to other existing open space – whereby either:

(a) Takes maximum advantage of and uses Council owned land or assets, including appropriate areas within existing schemes, or

(b) Linkage will be created and new opportunities for public use and enjoyment that would not otherwise be possible if the sites were unconnected; or

(5) Have potential for water quality improvements – whereby:

Planting or natural regeneration will measurably improve the quality of local surface water by reducing silt run-off or intercepting excess nutrients in groundwater.

(6) Provide opportunity for a mix of recreational activities – with preference for:

(a) Opportunity for specific ‘niche’ recreational activities that are currently under-represented in the region and/or significantly constrained by access to suitable sites on public land (e.g. hang-gliding, caving, horse-riding)

(b) Opportunity for the site to be used for a broad, mixed range of activities that will neither conflict with each other nor conflict with other attributes (such as ecological attributes) of the site.

(7) Contain sites of cultural or historical significance – either:

(a) A Category I or Category II listed historic site from the register of the NZ Historic Places Trust.

(b) A significant historic or cultural site publicly listed on a district, city or regional council database.

(8) Have camping potential adjacent to waterbodies

Each potential site for camping must be considered on its merits and in consultation with DOC and TLA’s. Key issues to cover and determine include (1) flood risks, (2)long term operation and maintenance costs, (3) likely impacts on the viability of existing commercial camp grounds in the area, and (4) the type of user-charge, ownership and management structure that would best fit local circumstances (i.e. whether free, fee-paying, seasonality adjusted, council-owned/run, privately-owned/run, or council and private partnership). But as a guide:

First priority is for road-access camping sites available over the summer.

Second priority is for road-accessed camping sites available all year.

(d) Third priority is for foot-access camping sites (at least 2 km from a road end) that provide a place of overnight refuge for longer journeys adjacent to water bodies.

(9) Provide partnership benefits – whereby:

Partnership intervention will (1)compliment work and/or policy objectives relating to open space opportunities of local territorial authorities, the Department of Conservation or other community groups (2) expand the range of benefits beyond purely Regional Council interests (3)not compromise or replace any legal requirements or obligations of TLA’s, Government departments or other agencies.

(10) Provide opportunity for environmental education – whereby:

The educational component will be consistent with Regional Council functions, policies and targeted educational programmes.

(11) At risk environments (Ecological, flood) – whereby:

Ownership or intervention will ensure the long term protection or enhancement of at risk environments in the Hawkes Bay.

(12) Iconic value – whereby:

Each site or opportunity being considered will be weighted for any iconic value, uniqueness or any extra factor or feature that can be identified as being of local, regional or national significance by reference to relevant Outstanding Landscape reports held by Council or Territorial Authorities.

Financial Attributes

The ideal site will consider:

(13) Development costs

Development costs, including significant capital investments are considered and weighted on a case by case basis.

(14) Maintenance costs

Maintenance needs and costs are to be calculated ahead of any purchase and will be based on the intended use of the site.

(15) Other financial returns

Other financial returns may be possible, for example, through leases concessions or carbon credits. Financial returns are to be calculated as exclusive of future value for re-sale except where re-sale of part or all of the land-holding will not compromise the primary public good objectives of the initial purchase.

(16) Resale potential – whereby:

In the event of a future change of circumstances the site can be readily disposed of (in whole or in part) at any time in the future if necessary.

Open Space Investment Policy

Attachment 2

Table 1: Minimum Qualifying Criteria for Regional Council Involvement

OPEN SPACE PROJECT:

PROPERTY COMMENT:

Open Space to be actively sought (“Category 1”)
	Coastal Access	Qualifies? Yes / No
Minimum requirements for Council involvement	· Coastal strip is currently impractical to access without crossing private land; OR · Public access is disputed and needs to be clarified; OR · Existing public access is under threat (e.g. from erosion)
	Near Urban	Qualifies? Yes / No
Minimum requirements for Council involvement	· Is of country park concept with a minimum number of formal facilities; OR · Contains a number of environmental aspects, e.g. water, flora & fauna, wildlife; OR · Be located to encourage significant use by urban population
	Ecological	Qualifies? Yes / No
Minimum requirements for Council involvement	· Has significant existing ecological values; OR · Existing ecological values will be protected or enhanced by intervention
	Aligned with HBRC Strategic Goals	Qualifies? Yes / No
Minimum requirements for Council involvement	· Encompasses the open space and at least 2 other Council strategic goals, · Provides for the concept of sustainability

Open Space to be passively sought (“Category 2”)
	Outstanding Natural Feature	Qualifies? Yes / No
Minimum requirements for Council involvement	· At risk in long term if remaining in private ownership; AND · Available at no more than normal market cost
	Lake or inland open water	Qualifies? Yes / No
Minimum requirements for Council involvement	· Within close proximity of a significant population base; AND · Suitable for water skiing & rowing; AND · Available at no more than normal market cost
	River access	Qualifies? Yes / No
Minimum requirements for Council involvement	· Available at significantly below normal market cost

Table 2: Attributes

	Key Attributes	Score Range	Score	Weighting	Max. Weighting	Contribution	Maximum
1	Coastal Access	1 - 5			10
2	Proximity to Centres of Population	1 - 5			10
3	Ecological value	1 - 5			10
4	Linkages	1 - 5			10
5	Water quality improvements	1 - 5			5
6	Recreational Opportunity	1 - 5			5
7	Cultural and Historical value	1 - 5			5
8	Camping Potential	1 - 5			5
9	Partnership benefits	1 - 5			5
10	Environmental education	1 - 5			5
11	At Risk Environments	1 - 5			5
12	Iconic value	1 - 5			5

	Financial Attributes	Score Range	Score	Weighting	Max. Weighting	Contribution	Maximum
13	Development Costs	1 - 5			5
14	Maintenance costs	1 - 5			5
15	Other financial returns (e.g. leases, concessions, carbon credits)	1 - 5			5
16	Resale potential	1 - 5			5
	Total Score				5

Overall Score = Total contribution score

Total maximum score x 100%

Decline	< 60%
Further Analysis	60 to 65%
Proceed	> 65%

[1] Environmental Management Services Ltd (July 2007)

1.	The facility must be owned or managed by a Territorial Local Authority or a Council Controlled Organisation, located in the Hawke’s Bay region.
2.	The facility should be of benefit to the whole Hawke’s Bay region or at least of benefit to a significant sub-region (eg: Wairoa or Central Hawke’s Bay).
3.	The facility should generally have a minimum capital value of $5 million in the instance of Napier City or Hastings District or $500,000 in the instance of Wairoa or Central Hawke’s Bay.
4.	The fund will support projects to establish or upgrade community infrastructure such as halls, museums, sports facilities, community centres, which are available for use by the community at large
5.	The fund would not normally support basic local authority infrastructure such as drainage, water supply, sewage or waste disposal or roading
6.	The fund would contribute to capital costs of facilities but not to operating costs
Other Criteria:
7.	The project should demonstrate local community support through the applicant’s LTCCP or Annual Plan process
8.	The sponsoring TLA must undertake responsibility for maintenance and renewals, preferably with depreciation funded
9.	The Regional Council should be satisfied that management and/or governance of the facility will be competent
10.	The Regional Council would expect the sponsoring Council to be directly funding or have receiving funding for at least 75% of the value of the project and the Regional Council would in no instance contribute more than 50% of the cost of the project
11.	The Regional Council would normally conduct no more than one funding round in each financial year and allocate in total in each funding round no more than that recommended by the Council’s Chief Executive