Ratepayers may get say on water deal

CONTENTIOUS: The site of the proposed Ruataniwha Dam.PHOTO/FILE

Regional ratepayers may get to have their say on whether or not they want to buy $43.1 million worth of water from the Ruataniwha water storage scheme.

In a meeting to be held next Wednesday, councillors will be asked whether or not they want to adopt the recommendation that the decision in principle to enter into a 35-year water user contract be open to a special consultative process through an amendment to council's Long Term Plan 2015-2025.

This public consultation u-turn comes in the wake of advice sought by council from Audit New Zealand after a heated debate last month on whether or not the buy-in was significant under the authority's Significance and Engagement Policy.

"Given the advice from the Audit Office it is recommended that council publicly consults on its 'in principle' decision through the Draft Annual Plan process.

"This paper recommends that council acknowledges the significance of the change to the levels of service and carries out public consultation as an amendment to the Long Term Plan 2015-2025."

Following the February 26 meeting, council staff contacted Stephen Lucy of Audit NZ, which was followed up by a letter.

"It is our proposal to recommend to council that a variation to the Financial Strategy be set out in the consultation document covering the annual plan 2016/17 which is currently being finalised," the council's letter read. "It is our view that this change would not trigger an amendment to the [long-term plan] as set out in section 97 of the Local Government Act."

Mr Lucy responded saying that whether or not a long-term plan required an amendment was a legal test, and as auditors they were unable to offer such advice.

However, he recommended not once, but twice council seek legal advice on the matter.

"I would strongly recommend that the council obtain legal advice as to whether an [Long Term Plan] amendment is required," he said.

"Based on the information that you have provided us with, we consider that the council may need to amend its [Long Term Plan].

"This is because of the proposed change to the financial strategy and because it appears that the council would be undertaking a significant new activity which is not provided for in the [Long Term Plan].

"Given the significant amount of money involved, and the contentious nature of the project, we would expect the council to be seeking legal advice on these issues, if it hasn't already done so."

According to the coming meeting's agenda, the response from the council says because of the targeted returns of proposed investments there will need to be a change made to the financial strategy to clarify that some portion of this return will be used by the council for the purchase of water for environmental flows.

"HBRIC has estimated the cost of the provision of financial flows from year 10 to year 35 to be approximately $43.1 million," the agenda reads. "The size of this financial cost does reflect a significant change to the [Long Term Plan] which supports the need to refer to a change in level of service."