Tauranga City Council has told the Government it cannot cope with its skyrocketing population and demand on infrastructure, warning of a critical housing shortfall.
Council commissioners have written to Environment Minister David Parker to notify him the council cannot meet its expectations under the National Policy Statement – Urban Development Capacity Requirements.
The letter is published in a report for a council meeting next week.
The letter says Tauranga is heading for a shortfall of 1119 homes in the next three years, even with 3188 new homes expected to be built in that time.
The shortfall was expected to increase to 1637 within 30 years, despite ongoing efforts to cater for growth.
The letter warned this shortfall could hit 5000 homes if there were further delays in releasing land for development at Tauriko and Te Tumu. It would be worse still if the council's intensification plans were not achieved.
The letter was jointly signed by the four commissioners Local Government Minister Nanaia Mahuta appointed to govern the troubled council in February: Bill Wasley, Shad Rolleston, Stephen Selwood and chairwoman Anne Tolley.
In the letter, they pleaded for help from the Government. While work was under way to tackle some city challenges, the letter said "the majority of issues are outside the control of the council".
"Many of the issues we face are under the direct control of government and we seek to build on our existing partnership to address them together to ensure we deliver not just enough new homes, but the right type and right-priced homes for our community.
"Alternative growth options simply do not exist in the city, so we collectively need to make these options work for everyone, and in a timely manner."
The National Policy Statement requires councils to provide sufficient development for housing in the short, medium and long term. This involves assessment of plans, infrastructure, development expectations and what is realistic – but Tauranga is unable.
In 2018 the Census estimated 142,100 people lived in Tauranga City. This is projected to rise to 166,300 by 2028 and 199,100 by 2048.
The neighbouring Western Bay of Plenty District had 53,300 residents on Census night and is projected to hit 60,900 in 2028 and 68,000 in 2048.
The letter stated a lack of funding for growth-related infrastructure was "a major concern", particularly for transport which was under "extreme pressure" and constantly rated as the biggest issue for residents.
While the commissioners agreed to address the issue it was one local government was unable to fund and the letter referred to constraints involving the state highway network.
"There is a concerning lack of forward planning, funding and potentially desire to improve this network which can't adequately meet all of these needs. This is becoming the significant limitation to growth in Tauranga."
The exclusion of second-stage funding for the Takitimu North Link highway had the potential to affect the delivery of more than 2000 new homes in Ōmokoroa, the letter stated.
The letter also listed nine projects already in progress in zoned development areas including structure planning and rezoning of Te Tumu to the east and Tauriko west, followed by the Keenan Rd and Ohauiti south areas and refreshing the city centre "with a strengthened focus on residential development".
Work was underway to secure funding through options including the Housing Infrastructure Fund and direct developer funding as means to "proceed at pace" while reducing "the inequitable burden on ratepayers for growth-related investment".
The Three Waters reform was also noted as creating "significant risk" for many proposed housing developments such as Tauriko west and Te Tumu. The latter had other challenges, such as gaining access through multiple owned Māori land, which had stalled development. Some of the 4000 landowners had opposed development plans, resulting in court hearings.
The letter stated it was "critical" government resourcing be allocated to the TK14 Māori Land Trust to help progress development.
City property leader Scott Adams, managing director of Carrus, said because of the city's topography and collection of isthmuses "everyone either wants to be near the water or have a view of it."
"Subsequently we have this urban sprawl and (under government legislation) now with the lack of zoned land the only way to increase housing supply is to go up.
"This involved redevelopment of existing land but this was at times stymied by legislation and National Policy Statements," he said.
"All of these things take time but it's time we don't have. We are in a housing crisis mode now."
Adams said he would like to see the Government provide better support to the council to unlock housing opportunities, for example, fast-tracking plan changes and investment into future infrastructure.
Classic Builders director Peter Cooney said the city needed to be acting now for the benefit of the region in 20 to 30 years' time.
"The reality is that we never looked far enough ahead as to what our requirements were when we go back seven or eight years ago.
"We didn't plan three or four decades ahead, we were planning a decade ahead."
Cooney said there was "a major housing shortage" in the Bay due to a lack of zoned land, and a lack of land serviced by infrastructure.
The council had been left to "foot the bill" but did not have the financial capacity to do so, he said.
"If we don't get on top of it ... prices in Tauranga will just keep going up."
Commissioners will meet to discuss and receive the letter in a council meeting on Tuesday.