Agenda of Corporate and Strategic Committee

	Agenda Item	Follow-up / Request	Person Responsible	Status Comment
1	Local Government Elections 2016	Circulate the 2013 Pre-election report	L Hooper	Emailed to Councillors on 26 April 2016
2	Health & Safety Update	Near miss incidents to be separately reported for clarity	V Moule	Included in the latest H&S update report
3	Update of RWSS Regional Economic Assessment	Provide Council with uptake volumes linked to land use, i.e. x m³ for xx hectares arable x m³ for xx hectares dairy	HBRIC	Pie charts from 27 April Council meeting follow (next page)

HAWKE’S BAY REGIONAL COUNCIL

Corporate and Strategic Committee

Wednesday 15 June 2016

SUBJECT: HBRIC Ltd 2016-17 Statement of Intent

Reason for Report

1. To meet Local Government Act 2002 legislative timeframes, the Hawke’s Bay Regional Investment Company Limited (HBRIC Ltd) is required to present its final Statement of Intent (SOI) to Council (as shareholder) for approval by 30 June.

2. The Council’s investment company (HBRIC Ltd) is a Council Controlled Trading Organisation (CCTO) and a strategic asset in terms of the Local Government Act 2002 (the Act).

3. HBRIC Ltd’s first draft of its SOI was presented to the Corporate and Strategic Committee on 13 April 2016 in accordance with the requirements of the Act to submit a draft SOI.

4. The draft was further refined by HBRIC Ltd at its Board Meeting held on 7 June 2016, and is now presented for Council’s final comment and approval.

5. A copy of the correspondence from the HBRIC Ltd Chief Executive is set out in Attachment 1, with the amended SOI provided as Attachment 2.

Changes from Draft SOI – Requested by Council

6. HBRIC Ltd has amended the SOI to incorporate changes advised by Council when the draft SOI was presented to the Corporate and Strategic Committee on 13 April 2016. These changes are as follows:

6.1. Page 6 – Inclusion of the words “and/or working capital” in line 1 to reflect Council’s decision to provide authority of HBRIC Ltd to raise funds for the purpose of not only investment, but also working capital.

6.2. Page 10 - Inclusion of the term “TBA” (to be advised) in terms of the forecast dividends for 2017-18 and 2018-19.

6.3. Pages 10 & 11 - A change to the dividend level for 2016-17 of $11,534,000 (if the RWSS proceeds under current timelines) and $9,500,000 (if RWSS does not proceed or RWSS is delayed by approximately one year).

Changes from Draft SOI – Further Changes by HBRIC Ltd

7. As advised by the HBRIC Ltd Chief Executive in his covering letter accompanying the SOI, the HBRIC Ltd Board, at its meeting held on 7 June 2016, has further refined the SOI that was presented to the Corporate and Strategic Committee on 13 April 2016 as follows:

7.1. Updated the list of HBRIC Ltd Directors on page 2 of the SoI to reflect Council’s decision on 30 March 2016.

7.2. Updated the paragraph on Board Composition on page 8 to reflect Council’s decision on 30 March 2016.

7.3. Updated the ratio of shareholders’ fund to total assets (page 10) and performance targets and measures (pages 10 & 11) to reflect the latest financial forecasts for both the group and parent.

Council Review

8. Council officers have reviewed the Statement of Intent and confirm:

8.1. It complies with the requirements of Schedule 8 Clause 9 of the Act

8.2. It is consistent with and complies with the requirements of the Council’s Investment Policy as stated in the Long Term Plan 2015-2025.

Decision Making Process

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

9.1. The decision does not significantly alter the service provision or affect a strategic asset.

9.2. The use of the special consultative procedure is not prescribed by legislation.

9.3. The decision does not fall within the definition of Council’s policy on significance.

9.4. The persons affected by this decision are all persons with an interest in the management of Council’s investments.

9.5. There were no other options considered as the requirements and timeframes are legislated.

9.6. The decision is not inconsistent with an existing policy or plan.

9.7. Given the nature and significance of the issue to be considered and decided, and also the persons likely to be affected by, or have an interest in the decisions made, Council can exercise its discretion and make a decision without consulting directly with the community or others having an interest in the decision.

Recommendations

1. That the Corporate and Strategic Committee receives and considers the issues discussed in the HBRIC Ltd 2016-17 Statement of Intent report.

2. The Corporate and Strategic Committee recommends that Council:

2.1. Agrees that the decisions to be made are not significant under the criteria contained in Council’s adopted Significance and Engagement Policy, and that Council can exercise its discretion and make decisions on this issue without conferring directly with the community and persons likely to be affected by or to have an interest in the decision.

2.2. Notes that this Statement of Intent for HBRIC Ltd, as a Council Controlled Trading Organisation, is required to be presented to Council as a shareholder of HBRIC Ltd under the provisions of the Local Government Act 2002.

2.3. Approves HBRIC Ltd’s submitted Statement of Intent, and notes that the Statement of Intent reflects the Council’s objectives for HBRIC Ltd and has been prepared in accordance with the requirements of the Local Government Act 2002.

Heath Caldwell

Management Accountant

Liz Lambert

Chief Executive

Attachment/s

1	HBRIC Ltd Statement of Intent Cover Letter
2	HBRIC Ltd 2016-17 Statement of Intent

HAWKE’S BAY REGIONAL COUNCIL

Corporate and Strategic Committee

Wednesday 15 June 2016

Subject: Annual Bus Fares Review

Reason for Report

1. To review and set bus fares from 1 August 2016.

Financial and Resource Implications

2. Options B, C and D may have financial implications for Hawke’s Bay Regional Council, as outlined in Table 10.

Background

3. NZ Transport Agency policy requires regional councils to undertake a review of bus fares, discounts, concessions and ticket types annually.

4. Bus fares were last reviewed at the November 2015 meeting of the Corporate and Strategic Committee. A decision was made to leave fares unchanged but to review these again during 2016-17. However, as a number of changes are to be made to the bus services for the 1 August commencement of the new contract, it is an opportune time to revisit this issue so that any new fare information can be included in the new timetable.

5. The Regional Council was presented with two fare options at its May meeting, but decided to delay a decision pending the development of further options for the introduction of concession fares on the Express services. This item therefore presents four options.

Current Fares

6. The last fare increase, of 3.6%, was implemented in September 2014. However, since then, the NZTA Cost Index for Public Transport (which is used to adjust contract prices for inflation) has fallen by 0.7%.

7. Current fare details are set out in tables 1 and 2.

Table 1 - Single Trip Cash Fares

	*Adult*	*Tertiary Student/Community Services Card*	*Child/High School Student/Senior*
*1 zone*	*$3.60*	*$2.40*	*$1.80*
*2 zone*	*$5.40*	*$3.60*	*$3.00*
*Express*	*$4.20*

Table 2 – Single Trip goBay Smartcard Fares (approximately 20% cheaper than cash fares)

	*Adult*	*Tertiary Student/Community Services Card*	*Child/High School Student/Senior*
*1 zone*	*$2.88*	*$1.90*	*$1.43*
*2 zone*	*$4.28*	*$2.86*	*$2.14*
*Express*	*$3.65*

7. EIT students pay only a one zone fare, as EIT is the zone boundary. A single smartcard trip to/from EIT from either direction is $1.90 (with EIT student ID).

8. SuperGold cardholders travel free between 9am and 3pm Monday to Friday and anytime on weekend/public holiday services. HBRC is reimbursed for these fares by the NZ Transport Agency.

9. District Health Board patients travelling from Napier to Hawke’s Bay Hospital, travel free of charge on production of a valid appointment card/letter. HBRC is reimbursed for these fares by the DHB.

10. As seen in Table 3, about 78% of goBay fares (excluding transfers) are concessionary fares of one type or another.

11. The Express service fare was originally set at a cheaper rate than the 2 zone fare between Napier and Hastings in order to encourage use of the service, and also because a smaller, cheaper and less comfortable vehicle has been used on the service. However, these vehicles have been outgrown and the new contract requires larger buses with bike racks, in keeping with the rest of the urban fleet.

12. The Express fare is also currently a set fare – there are no zonal fares, and child and student concessions are not available. This means that, for example, high school students travelling from Clive to Napier are paying the same as adult commuters travelling between Havelock North and Napier. A new Express service from Napier via Taradale to Hastings (Route 10) will commence in August, and for consistency, should have the same fares as the Route 11 Express via Clive.

13. We do not have exact information on the number of school students travelling on the Route 11 express, but anecdotally we know that the service is used by some students travelling to Napier Boy’s High School. We estimate that around 20% of passengers are school students.

Table 3 - Passenger Category Percentages

Passenger Category	2014-15		2015-16 (10 months)
	Number	Percentage	Number	Percentage
Adult	122,498	16.8%	92,793	16.3%
Child/High School Student	204,468	27.5%	151,064	26.6%
Community Services Card	125,300	16.8%	93,821	16.5%
Senior	16,357	2.2%	13,388	2.4%
SuperGold card	115,753	15.5%	98,367	17.3%
Tertiary Student	97,325	13.1%	75,948	13.4%
Promo/10 trips (sold by HBRC)	14,227	1.9%	6,203	1.1%
DHB Appointment	3,265	0.4%	2,567	0.5%
Transfer	42,561	5.7%	32,278	5.7%

Service Improvements

14. At the April 2016 meeting, Council agreed to implement a number of improvements to the bus service, at an estimated average annual cost of $44,000 to HBRC. This cost can be met from existing budgets in the Long Term Plan.

Fare Revenue

15. For the ten months to April 2016, the bus service has collected $1,120,000 in fares (excluding GST, including SuperGold payments). This equates to a 37.8% fare recovery rate. (Fare recovery is the portion of the total cost of the service that is recovered from fares).

Option A - All fares to remain unchanged for the 2016-17 year

16. Advantages in support of this option are:

16.1. The cost of providing public transport, as measured by the NZTA Cost Index for Public Transport, has not increased since the last fare increase; in fact it has decreased slightly.

16.2. The new lower contract cost which comes into effect on 1 August will have the effect of improving the fare recovery rate of our service considerably, even with the agreed improvements. Unless there was a substantial further decline in patronage or a significant increase in costs, it is highly likely that our fare recovery rate will exceed the 41% target in the Regional Land Transport Plan.

16.3. In a period of declining patronage such as we are currently experiencing, a fare increase could further increase the perceived “cheapness” of taking the car. Public transport best practice aims to set bus fares favourably against the cost of operating a car. In a period of low petrol prices, a fare increase could exacerbate the patronage decline.

16.4. Maintaining low Express fares could help to promote the new Route 10 Express service, giving it time to “bed in” and allowing staff to analyse patronage and determine the best fare structure for the future.

17. Disadvantages of this option are:

17.1. This option does not address the anomaly between the higher cost of taking the Route 12 bus service between Napier and Hastings (a 2-zone trip which takes an hour) and the faster, more direct Express services. New, larger buses are to be used on these routes and bike racks will now also be available; the existing fare structure does not recognise the improved service.

17.2. Clive residents do not get the benefit of a 1 zone fare, in recognition of the fact that they are travelling only half the distance.

17.3. School and tertiary students continue to pay the full adult fare on the Express service and this could be discouraging potential users.

Option B - All fares unchanged except for the Express services. Express service adult fares increased as for 2-zone services. Concessions introduced.

18. This option would see Express service adult cash and smartcard fares increased to be consistent with 2-zone fares, and concession fares and a Clive zone boundary introduced.

19. This option entirely removes the distinction between fares on the current 2-zone Route 12 services between Napier and Hastings and on the Express services. The Route 10 and Route 11 Express services would have the same structure and fare levels as the 2-zone Route 12, and Clive would become the zone boundary for the Route 11 Express.

20. The table below shows proposed fares under this option. Bold text indicates increased fares, while shaded cells indicate new cheaper fares (either concession or 1-zone).

Table 4 – Option B Single Trip Cash Fares

	*Adult*	*Tertiary Student/Community Services Card*	*Child/High School Student/Senior*
1 zone	$3.60	$2.40	$1.80
2 zone	$5.40	$3.60	$3.00
Express 1 zone	$3.60	$2.40	$1.80
Express 2 zone	*$5.40*	$3.60	$3.00

Table 5 – Option B Single Trip Smartcard Fares

	*Adult*	*Tertiary Student/Community Services Card*	*Child/High School Student/Senior*
1 zone	$2.88	$1.90	$1.43
2 zone	$4.28	$2.86	$2.14
Express 1 zone	$2.88	$1.90	$1.43
Express 2 zone	*$4.28*	$2.86	$2.14

21. Advantages of this option are:

21.1. For most passengers, the benefits outlined in 16.1 to 16.3 would still apply.

21.2. This option addresses the anomaly between the higher cost of taking the Route 12 bus service between Napier and Hastings (a 2-zone trip which takes an hour) and the faster, more direct Express services.

21.3. This also recognises the improved service on Route 11 (bigger buses and bike racks) and the recommencement of a Route 10 Express service.

21.4. This option provides concession fares and a zone boundary for Express passengers which are consistent with our other services and may encourage greater use of the Express services.

22. Disadvantages of this option are:

22.1. Current Express adult passengers on Route 11 via Clive, if travelling from Havelock North/Hastings, would have a significant fare increase (28% on the cash fare, 17% on the smartcard fare) and this could cause some to cease using the service. However, all other passenger classes and all passengers to/from Clive would have cheaper fares.

23. Overall, if patronage stayed exactly as it is now, the fare revenue on Route 11 and predicted revenues on the new Route 10 service would increase only slightly; the higher adult fares would be partially offset by the lower rates offered for concession passengers and Clive residents. However, it is also possible that the services would attract more passengers, due to the lower fares offered to these groups.

Option C – No fare increases, Express adult fares remain at current levels. Concessions introduced on Express services to match Route 12, zone boundary introduced for Clive.

24. This proposal is the same as Option B except that adult Express passengers would not have a fare increase.

25. Tables 6 and 7 show the proposed fares under this option.

Table 6 – Option C Single Trip Cash Fares

	*Adult*	*Tertiary Student/Community Services Card*	*Child/High School Student/Senior*
1 zone	$3.60	$2.40	$1.80
2 zone	$5.40	$3.60	$3.00
Express 1 zone	$3.60	$2.40	$1.80
Express 2 zone	$4.20	$3.60	$3.00

Table 7 – Option C Single Trip Smartcard Fares

	*Adult*	*Tertiary Student/Community Services Card*	*Child/High School Student/Senior*
1 zone	$2.88	$1.90	$1.43
2 zone	$4.28	$2.86	$2.14
Express 1 zone	$2.88	$1.90	$1.43
Express 2 zone	$3.65	$2.86	$2.14

26. Advantages of this option are:

26.1. No fare increases are proposed, therefore the benefits outlined in 16.1 to 16.3 would apply to all passengers.

26.2. This option provides concession fares and a zone boundary for Express passengers and may encourage greater patronage.

27. Disadvantages of this option are:

27.1. For adult 2-zone passengers, this option does not address the anomaly between the higher cost of taking the Route 12 bus service between Napier and Hastings (a 2-zone trip which takes an hour) and the faster, more direct Express services.

27.2. Concession rates are set at 33% (concession) and 50% (child) of the adult fare on other Hawke’s Bay services. Not increasing the adult fare on the Express services reduces the differential to 21% and 41% respectively for this service only, which is inconsistent.

28. Overall, if Route 11 patronage stayed exactly as it is now and assuming that 20% of current passengers would be eligible for concessions, this option would cost approximately $3,000 per year in lost revenue on Route 11. However, it is probable that the service would also attract more concession and Clive passengers.

29. The proposed Route 10 Express service may carry some concession passengers, particularly in the afternoon. Our estimates of the net cost of this service may be affected by about $5,000 per year by the introduction of concessions to the Route 10 service.

Option D – No fare increases, Express adult fares remain at current levels and Route 12 2- zone fares are decreased to match these. Concessions introduced on Express services, zone boundary introduced for Clive.

30. This is a more innovative proposal which would see the Route 12 2-zone fare brought down to match the existing Express fare, and concessions introduced as for Options B and C.

31. Tables 8 and 9 show the proposed fares under this option.

Table 8 – Option D Single Trip Cash Fares

	*Adult*	*Tertiary Student/Community Services Card*	*Child/High School Student/Senior*
1 zone	$3.60	$2.40	$1.80
2 zone	$4.20	$3.60	$3.00
Express 1 zone	$3.60	$2.40	$1.80
Express 2 zone	$4.20	$3.60	$3.00

Table 9 – Option D Single Trip Smartcard Fares

	*Adult*	*Tertiary Student/Community Services Card*	*Child/High School Student/Senior*
1 zone	$2.88	$1.90	$1.43
2 zone	$3.65	$2.86	$2.14
Express 1 zone	$2.88	$1.90	$1.43
Express 2 zone	$3.65	$2.86	$2.14

32. Advantages of this option are:

32.1. No fare increases are proposed, therefore the benefits outlined in 16.1 to 16.3 would apply to all passengers.

32.2. The anomaly between the higher cost of Route 12 and the faster, more direct Express services would be removed.

32.3. This option provides concession fares and a zone boundary for Express passengers and may encourage greater use of the Express services.

32.4. The reduced adult fare on Route 12 would no doubt be seen in a very positive light by current and potential passengers. It would compare favourably with the cost of driving between cities and could encourage more patronage.

33. Disadvantages of this option are:

33.1. Concession rates have long been set at 33% (tertiary student, community services card) and 50% (child, senior) of the adult fare. This proposal reduces the differential to 21% and 41% for 2 zone fares, which is inconsistent with the 1 zone fares.

33.2. Lost revenue would be highest under this option, approximately $15,000 to $18,000 per year.

Summary

34. Table 10 summarises the key features of each option.

Table 10 – Summary of Options

Option	Adult fare change?	Consistent fares between Route 12 and Route 10/11 EXPRESS?	Concession fares on all services?	Zone boundary introduced for Clive?	Gain/loss of existing or estimated new fare revenue.	Consistent concession percentages?
A	No	No	No	No	No	Yes
B	Increase for Express adult fares	Yes	Yes	Yes	Possible gain of $5,000-$8,000 p.a.	Yes
C	No	No – the Express adult fares would still be cheaper than Route 12	Yes	Yes	Possible loss of $7,000 to $9,000 p.a.	No
D	Decrease in Route 12 2-zone fares	Yes	Yes	Yes	Possible loss of $15,000 to $18,000 p.a.	No

Discussion

35. The gross cost of operating the existing bus service has not increased since the last fare increase in 2014. The new contract price will improve the fare recovery rate of the service significantly (all other factors being equal). Patronage has declined over the last two years, and this is very likely to be connected to cheaper fuel prices. Increasing fares overall is therefore likely to be counter-productive and is not supported by HBRC staff or GoBus.

36. The new Route 10 Express service will offer a fast and convenient service to Hastings via Taradale and the HB Expressway. However, under the current fare structure, passengers on this service pay less than on Route 12, which is a slower, less convenient trip. This fare structure has been in existence for seven years, and was designed to encourage use of the Express services when they were first introduced.

37. Clive residents currently pay the same as passengers between Havelock North and Napier. The lack of concession fares on the Express services probably deters some users. Providing concession fares and a Clive zone boundary would encourage greater use of Express services, but equalising Express adult fares (Option B) with 2-zone fares could deter existing adult Express passengers, who currently make up around 80% of the users. This would be a significant increase in price for this group of passengers.

38. Conversely, decreasing the cost for adult 2-zone trips on Route 12 to match the Express fare would potentially cost the most, but would help to promote this service. Increased patronage might help to cover the lost revenue.

39. Leaving the Express fare unchanged but introducing concessions (Option C) does not address the anomaly between Express and 2-zone adult fares.

40. If the Committee wishes to introduce complete parity between the Express and 2-zone fares, then it should choose either Option B or Option D, noting probable effects on revenues. However, if greater certainty of revenue is important while the new Route 10 service is established, then Option A would provide this.

Decision Making Process

41. Council is required to make every decision in accordance with the requirements of the Local Government Act 2002 (the Act). Staff have assessed the requirements in relation to this item and have concluded:

41.1. The decision does not significantly alter the service provision or affect a strategic asset.

41.2. The use of the special consultative procedure is not prescribed by legislation.

41.3. The decision does not fall within the definition of Council’s policy on significance.

41.4. The persons affected by this decision are existing and potential bus passengers in the Hawke’s Bay region.

41.5. Options that have been considered include do nothing.

41.6. The decision is not inconsistent with an existing policy or plan.

41.7. Given the nature and significance of the issue to be considered and decided, and also the persons likely to be affected by, or have an interest in the decisions made, Council can exercise its discretion and make a decision without consulting directly with the community or others having an interest in the decision.

Recommendations

The Corporate and Strategic Committee recommends that Council:

1. Agrees that the decisions to be made are not significant under the criteria contained in Council’s adopted Significance and Engagement Policy, and that Council can exercise its discretion and make decisions on this issue without conferring directly with the community and persons likely to be affected by or to have an interest in the decision.

2. Receives and notes the Annual Bus Fares Review report.

3. Agrees to implement either Option A, B, C or D, noting the likely effects of each option.

Anne Redgrave

Transport Manager

Liz Lambert

Chief Executive

Attachment/s

There are no attachments for this report.

HAWKE’S BAY REGIONAL COUNCIL

Corporate and Strategic Committee

Wednesday 15 June 2016

Subject: HB Tourism Quarterly Update

Reason for Report

1. HB Tourism reports to Council quarterly, against the KPIs (following) as resolved by Council on 30 September 2015.

2. A report from HB Tourism setting out achievements, progress towards the key performance indicators and the Company’s financials to 31 March 2016, is attached to this paper.

KPIs

	Activity	HBRC KPIs
Consumer Marketing	Deliver an annual consumer marketing plan to ensure Hawke's Bay maximises all media opportunities both paid and unpaid.
Brand	Manage and protect the Hawke's Bay brand to ensure the brands integrity in all use by all parties	Manage and protect the Hawke's Bay brand to ensure the brands integrity
Campaign	The development and delivery of an annual media plan that is based around a Seasonal Campaign Strategy	Campaign activity will deliver Increased website traffic to www.hawkesbaynz.com by 50% annually
		Increase social channel footprint within Facebook, Twitter, Instagram. Each by 50% per annum
PR/Media	The delivery of the Hawke's Bay Tourism International and Domestic Media Programme	Host a minimum of 30 international and domestic media per annum
		Deliver stories and Hawke’s Bay content to over 100m people per annum
		Coverage received will have the equivalent EAV of $10m per annum
Digital	The delivery of a strong digital platform to share Hawke's Bay content and information for visitors.	The development of one visitor website for Hawke's Bay. To be completed by June 2016.
		Increased website traffic to www.hawkesbaynz.com by 50% annually
		Increase social channel footprint within Facebook, Twitter, Instagram. Each by 50% per annum
		Deliver 60,000 leads directly to member websites in year one. Grow by 50% per annum.
Collateral & Promotional Material	Deliver a series of promotional material both digital and printed to serve the needs of visitors and in line with the overall brand positioning for Hawke's Bay	Produce and deliver the annual Hawke's Bay Visitor Guide. Produce the Hawke's Bay Trails Map as well as other regional collateral as required.
Content	Deliver a consumer content strategy for all channels used by HBT	Pull together a content calendar for year round seasonal content for all cities and districts
Research	Deliver an annual research programme to monitor and measure the regions visitor performance	Provide the industry with up to date data pertaining to the visitor industry in Hawke's Bay. This will be distributed via the industry website.
Events	Deliver the Regional Events Strategy	Implement the Regional Events Strategy via joint collaboration with all Councils, Sport Hawke's Bay and other relevant agencies. Key outcomes - a regional events calendar updated, a well balanced portfolio of events year round, off-season events developed
	FAWC! Food and Wine Classic Hawke’s Bay	Deliver both Summer and Winter F.A.W.C! FAWC! to deliver at least 40-50% of participants from out of town each year. Continue to grow the event in terms of numbers -10,000 tickets available by 2018.
	The Big Easy	Deliver The Big Easy at Easter to ensure the event captures at least 40-50% of participants from out of town each year. Continue to grow the event to 2000 participants by 2017.
	Hawke’s International Bay Marathon	Deliver a world class event alongside organisers Lagadere for three years. This will involve a starting base of 2500 competitors in year one to grow to 4,000 by 2018.
Trade Marketing	Deliver the annual trade marketing plan to ensure Hawke's Bay is well represented within the distribution channel both offshore and in New Zealand.
International Marketing Alliances	Maintain membership of both Explore Central North Island Alliance which promotes the Pacific Coast Highway and Thermal Explorer Highway. (8 North Island regions) and Classic New Zealand Wine trail Alliance (4 regions) to ensure international presence for Hawke’s Bay.	Deliver international trade initiatives alongside other regional partners. Attend a minimum of 3 international trade shows (see below) and participate in growing the touring routes Hawke’s Bay is part of. Full international focus of activity and all directed at the travel agent community.
Trade Famils	Deliver an international trade famil programme to educate the travel industry about Hawke's Bay with the aim to sell more of the region via the Distribution Channel	Host a minimum of 50 travel agents, product managers and inbound tour operators in the region annually
Digital	Deliver and maintain a Tourism Industry Website for operators within Hawke's Bay. www.hawkesbaytourism.nz	Keep updated the industry website with relevant press releases, research, presentations and industry news.
Workshops	Conduct a Workshop Series to educate local operators	6 - 10 workshops to be held annually. Topics to include new markets, market segments, and social channels
Trade Shows	Represent Hawke's Bay and its tourisms sector at a range of leisure/FIT (free and independent travellers) trade shows throughout the year in New Zealand and overseas	HBT to attend the following trade shows annually; TRENZ and Explore. HBT to represent Pacific Coast Highway (Explore Central North Island Alliance) at Kiwi Link events in China, USA, UK.
Business Tourism Events	Represent Hawke's Bay and the Conference and Meetings sector at a range of business trade shows throughout the year in New Zealand	HBT to attend the following business trade shows annually; Meetings and Convene
Tourism Awards	Deliver the annual Hawke's Bay Tourism Industry Awards	Generate at least 20 entries per annum into the Hawke's Bay Tourism Awards (September each year)
Tourism Development	Identify key tourism development projects to encourage economic growth to the region	Begin scoping of tourism opportunities in Wairoa/Waikaremoana. Work with local iwi to understand Maori tourism product - the gaps and opportunities
Markets	Develop a clear plan for China tourism to Hawke's Bay	Develop and maintain Hawke's Bay content for the China market - to be distributed via Weibo. Build a China Marketing Group to develop join marketing opportunities
Membership	Manage and grow the annual membership programme of the Hawke’s Bay Tourism Industry Association
	Deliver an annual membership programme in order to generate additional funds for the organisation and develop a strong well educated and coordinated industry.	Generate a minimum of $100,000 in revenue from the annual membership programme.
Stakeholder Management	Deliver quarterly reports to the Hawke's Bay Regional Council	4 x Quarterly reports delivered as well as Financials
Financial Management	Manage all budgets and deliver monthly and quarterly financial reports to both the HBT, HBTIA Boards and to HBRC	Manage all budgets and deliver monthly and quarterly financial reports to both the HBT, HBTIA Boards and to HBRC
Staff Management	Manage all staff and conduct annual reviews	Annual reviews it be conducted for all staff. Training needs worked through and planned to improve staff skills

Decision Making Process

3. Council is required to make every decision in accordance with Part 6 Sub-Part 1, of the Local Government Act 2002 (the Act). Staff have assessed the requirements 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 the Corporate and Strategic Committee receives and notes the “HB Tourism Quarter 4 2015-16 Update” report.

James Palmer

Group Manager
Strategic Development

Attachment/s

HB Tourism Quarter 4 2015-16 Update

HAWKE’S BAY REGIONAL COUNCIL

Corporate and Strategic Committee

Wednesday 15 June 2016

Subject: June 2016 Public Transport Update

Reason for Report

1. This agenda item provides the Committee with an update on Council’s public transport operations.

General Information

2. Preparations are well underway for the implementation of bus improvements in conjunction with the start of the new bus contract on 1 August 2016.

3. Patronage in regional centres around the country continues to decline, with decreases consistent with those seen in Hawke’s Bay. Most regional councils consider that lower petrol prices are the major reason for this.

4. A review of bus fares is the subject of a separate item in this agenda.

Bus Passenger Trips

5. Diagram 1 shows total bus passenger trips during 2012-13, 2013-14, 2014-15 and 2015-16 for the 11 months to 31 May 2016.

Diagram 1 – Passenger Trips – 2012-13, 2013-14, 2014-15, 2015-16 YTD

6. The average monthly patronage for the 11 months to May for 2012-13, 2013-14, 2014-15 and 2015-16 YTD is shown in Diagram 2.

Diagram 2 – Monthly Average Passenger Trips for the 11 months to 31 May

Year	Monthly Average Patronage
2012-13	63,509
2013-14	66,777
2014-15	62,053
2015-16	57,701

7. Analysis of patronage by route for May, compared with May 2015, shows that Flaxmere and the Hastings services had more passengers this year, while most Napier services had fewer. Route 11, the Express service via Clive, also showed an increase. Patronage on Route 12 services between Napier and Hastings declined by 3.9%.

Bus Service Costs

8. The following table shows the net cost (after fares and excluding GST) of operating the goBay bus service to 31 May in 2012-13, 2013-14, 2014-15 and 2015-16. The costs include base contract and quarterly incentive and indexation costs, which accounts for the significant price fluctuations between months.

Diagram 3 – Net Cost of Bus Service – 2012-13, 2013-14, 2014-15 and 2015-16 YTD

(53% of this cost is met by the New Zealand Transport Agency).

9. The following table shows the average cost per passenger and cost per passenger-kilometre over the last four years, for the 11 months to 31 May. Passenger–kilometres is a measure widely used for reporting public transport results, as it reflects the distance that passengers have travelled, rather than just a head count of boardings

Diagram 4 - Average cost per passenger and per passenger-kilometre over the last four years.

Fare Recovery

10. Fare recovery is the portion of the total cost of the service that is covered by fares (including Supergold payments from central government). Diagram 5 shows fare recovery in 2012-13, 2013-14, 2014-15 and 2015-16 (YTD).

Diagram 5 – Fare Recovery – 2012-13, 2013-14, 2014-15 and 2015-16 YTD

2012-13	34.26%
2013-14	38.24%
2014-15	38.69%
2015-16 (YTD)	38.55%

Bus Stops

11. A number of new bus stops are being installed to service the 1 August 2016 improvements, in both Napier and Hastings.

12. HBRC has made a submission to the Hastings District Council’s Annual Plan, asking that a proposal to move the Eastbourne Street terminus east by one block, be re-considered. HBRC is very concerned about the effect that this would have on the service. Passengers would be considerably inconvenienced, as the new location is further from the centre of the CBD. All buses entering Hastings would need to be re-routed and this would create timetabling difficulties and increased cost.

SuperGold Card Scheme Update

13. As outlined at earlier meetings, changes to the way SuperGold card scheme funding is to be allocated will have a slight effect on the amount received by Hawke’s Bay Regional Council. A transitional approach is in place for 2016-17, based on SuperGold numbers carried in 2015-16. Current estimates are that HBRC will receive approximately $2,000 less in 2016-17 than we will receive this year. This is not considered significant and will not affect the operation of the service.

Total Mobility

14. The following tables compare the number of Total Mobility trips made during 2012-13, 2013-14, 2014-15 and 2015-16 to 30 April, and the corresponding costs (excl GST).

15. The number of TM trips for the year to date is slightly lower than for the same period last year. This trend is also apparent in the cost of the Total Mobility. The number of Total Mobility users registered with the Council to 30 April is 3,280, down from 3,443 in 2015.

Diagram 6 – Total Mobility Trips – 2012-13, 2013-14, 2014-15, 2015-16 (YTD)

Diagram 7 – Total Mobility Cost ($ excl GST) – 2012-13, 2013-14, 2014-15, 2015-16 (YTD)

(60% of this cost is met by the New Zealand Transport Agency)

Decision Making Process

16. Council is required to make every decision in accordance with Part 6 Sub-Part 1, of the Local Government Act 2002 (the Act). Staff have assessed the requirements 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 the Corporate and Strategic Committee receives and notes the “June 2016 Public Transport Update” report.

Anne Redgrave

Transport Manager

Liz Lambert

Chief Executive

Attachment/s

There are no attachments for this report.