Kāpiti mayor K Gurunathan. Photo / Jack Penman
Weekly opinion column by Kāpiti mayor K Gurunathan
For several months now councillors have been immersed in working through a huge amount of issues and information to help deliver our next 20-year Long Term Plan (LTP).
Deciding what to invest in and when and how we will pay for it is a balancing exercise. There are some key focus areas that pose both challenges and opportunities.
Firstly, Wellington region's 30-year demographic projections will see our Kāpiti Coast population estimated to grow by 30,000. This means we need to plan for a greater demand for infrastructure and services. And the inevitable growing pressure on our natural environment.
Like the rest of New Zealand, we are experiencing increasing demand for housing. With that has come affordability issues, rising rents and pressures on public housing services.
The only area we have a direct role is the service of 118 pensioner housing. While council does not have a role in many of the drivers of this housing crisis, there are some areas where we have an influence.
In the last 12 months, we have been exploring what can be done to increase the supply of affordable homes to make it easier for people to access housing. We, however, don't have an enabling policy and the first step is seeking community input on the question of whether council should take a bigger role in housing and, if so, what that commitment might look like.
Then there is the big issue of climate change and, as a coastal community, we are vulnerable to a range of environmental challenges.
Coastal hazards will have increasing implications for new developments and our existing infrastructure including the cost of insuring our assets. We have serious decisions to make on the different options to protecting our assets.
Council is responsible for the delivery and maintenance of infrastructure network like our roads, sewage system, water and stormwater as well as soft assets or community assets like our libraries, parks, and recreational facilities. The LTP will look at more work on high priority projects like the Waikanae Library and our stormwater programme and other new initiatives. Given the Covid-19 impact, these projects will help stimulate our local economy.
While we are grappling with these challenges, central government is pushing ahead with a raft of reforms and, as described by other mayors, these reforms are being pursued at pace. And that's stressing councils.
The Three Waters Reform would potentially see the removal of about $300 million of our assets and 40 staff and the creation of more centralised large suppliers. We will also see radical changes to the RMA with the amalgamation of the region's many district plans into one bigger regional plan that will dominate spatial planning and the system of development.
We are potentially facing the loss of local planning and decision making. At the same time the Government's expectations of the role of local authorities is increasing. Councils now have responsibility for the four wellbeings that includes the social, environmental, cultural, and economic health of our communities. To be frank, many of the mayors have concerns about how these expectations can be sustained without additional support.
That brings us to the question of how we will pay for the challenges and opportunities ahead. Revenue from rates accounts for around three-quarters of our income because we don't have income generating assets.
A significant issue for our LTP is the increase to our base costs including inflation, insurance premiums and depreciation. And these are going up faster than household inflation.
As noted by most other mayors, our respective communities prefer lower rates increases while at the same time wanting greater services and facilities and opposing cuts that can reduce rates. So we need new ways of generating income and delivering key projects by working in partnerships with the public and private sectors to fund future development while reducing the burden on ratepayers.
We need new funding streams. The LTP will explore options. The council finance team, working with elected members have, over recent years, made significant improvements in its budgetary performance.
Benchmarked by the credit agency Standard & Poor revising our credit rating by two grades from A+ to AA. This gives me confidence that our council financial engine room has the skill-set to help us manage our challenges.