The council holds a 54.1% stake in New Zealand’s biggest port through its investment arm Quayside Holdings, and plans to enable a managed sell-down to a minimum 28%, council chairman Doug Leeder said in a media statement this week.
It comes as the council signs off on its Long-Term Plan, with an 8.2% average rates increase for the coming year. This statement said this equated to an extra $13 for a median-value residential property.
The plan sets the council’s budget and work over the next 10 years.
Each year the council uses its Quayside dividend to offset rates, with this year’s planned $47 million dividend reducing rates by an average $400 per household.
Leeder said the decision to sell some port shares was not taken lightly. It would allow the council, through Quayside, to diversify its investment portfolio and reduce its risk exposure, while remaining a “significant cornerstone” shareholder in the port.
He said before shares could be sold, the council needed to decide what process would be followed and approve the conditions of any sale.
Leeder said feedback on selling port shares was evenly split in submissions to the plan.
“Some submitters, particularly iwi and tangata whenua, raised considerations that we want to consider incorporating into the parameters of the sell-down process.”
This would happen “over the coming months”. The timeline for selling down shares and number of shares to be sold would depend on further analysis.
He said the shares had a current market value of $1.8 billion.
He said the council, through its 100% shareholding of Quayside Holdings Limited, would “remain a significant cornerstone and strategic shareholder in the port through retaining at least a 28% shareholding”.
The timeline for selling down shares and the number of shares sold would depend on further analysis, Leeder said.
The shares have a current market value of $1.8b.
Rates
Leeder said in the statement councillors listened to ratepayers’ call to balance essential services, looking ahead and affordability.
Bay of Plenty Regional Council chaiman Doug Leeder. Photo / Andrew Warner
“Through the budgeting process, we uncovered $4.5m in annual operating cost savings and a further $5m in budgeted savings from efficiency initiatives and shared services.”
Leeder said while the Quayside dividend continued to serve ratepayers well, he acknowledged targeted rate increases, which affected total rates people pay, varied across the region, depending on location and services received.
He said costs beyond the council’s control such as power, insurance and materials significantly impacted targeted rates rises.
“These costs have been compounded by high inflation and a tight global supply chain that have driven up labour and material costs.”
Flood protection
Leeder said flood protection work included building new or upgrading flood defences, with a particular focus on the Rangitāiki River area and Whakatāne township. Completion of the Rangitāiki River Floodway project was on track for late 2024.
The floodway and soon-to-be-completed spillway would help divert water from the river during a flood event, reducing the risk for downstream communities such as Edgecumbe.
Leeder said good progress was also being made on improving the stopbanks and floodwalls in the Whakatāne CBD. Further work was also planned in rural areas of the Tarawera River, the lower Kaituna River, and around the township of Ōpōtiki.
A view of Ian Noble’s rural Katikati property, which he hopes to gift to the region.
