Auckland's new mayor and council face some big decisions to respond to the city's rapid growth, says council chief executive Stephen Town.
With Mayor Len Brown standing down at October's local body elections, a new mayor and council will inherit a city growing at between 40,000 and 45,000 people a year and a very tight set of financial accounts.
"The margins are narrow and everyone has got to be aware of what those are," Mr Town said about the financial levers available to council.
In the past month, the council's financial constraints have become very apparent following a council decision to dip into a "rainy day" fund to reduce the risk of a credit-rating downgrade.
Credit rating agencies have warned the council of a rating downgrade if its debt-to revenue ratio approaches 270 per cent.
It is nearing 265 per cent.
This has curtailed the council's ability to increase debt -- which stands at $7.5 billion -- and a desire to build new infrastructure to support housing.
A review of the council's funding options by Cameron Partners and EY this year came up with a range of solutions, but the politically difficult issue of selling assets like shares in Auckland Airport and Ports of Auckland has been put off until after the elections.
Mr Town said he expected these issues to get a good airing in the election campaign and shape what people think about issues like staying with the AA credit rating and what council does with its balance sheet.
He will issue a pre-election, updated financial report in July and plans to provide the incoming mayor and councillors briefing papers similar to those given to a new government.