Tarawera sewerage scheme: Rotorua council seeks $3.5m more from regional council

Rotorua Mayor Tania Tapsell and Rotorua Lakes Council chief executive Andrew Moraes at a Bay of Plenty Regional Council meeting. Photo / Laura Smith

Rotorua Lakes Council is asking its regional counterpart to fork out $3.5 million more for the controversial Tarawera Sewerage Scheme.

At the same time, Tarawera residents have shared how their cost burden for the reticulation scheme is causing “undue stress” and tension in their community.

Lakes council chief executive Andrew Moraes and Rotorua Mayor Tania Tapsell attended a Bay of Plenty Regional Council meeting in Tauranga on Thursday.

Moraes outlined how the scheme’s costs escalated from $29m late last year to $32.3m, in part from delays and expense related to protests and court action over pipeline construction near Lake Rotokākahi.

A total of $10.785m is funded by the Ministry for the Environment ($6.5m), Lakes council ($3.5m) and regional council ($750,000), with the rest covered by ratepayers.

Tarawera ratepayers face a lump sum cost of $50,315 per household connecting to the scheme, which replaces septic tanks.

The council’s Annual Plan consultation poses options to lessen their load by asking $1m or $4m more from general Rotorua ratepayers, with public feedback to be heard next week.

Tapsell said the council wanted to deliver the scheme as affordably as possible.

She said it was critical for achieving objectives both councils shared, including improving Lake Tarawera water quality and protecting community health.

“What we are seeking from you today to consider is a fair and equal funding grant.”

She asked regional councillors to consider granting another $3.5m to the scheme, which would bring the lump sum cost to Tarawera residents down to $36,600, as some have requested – 50% of the total scheme cost.

Tapsell acknowledged the regional council had offered a $4m loan. She welcomed discussion on this as well as the option to achieve a 50% resident contribution.

She recommended the regional council recover the $3.5m grant through rates and consult with the wider community in its own Annual Plan process.

Bay of Plenty Regional councillor Lyall Thurston at a May meeting. Photo / Laura Smith

Regional councillor for Rotorua, Lyall Thurston, said “apart from the sell-down of the Port of Tauranga”, this issue had most “consumed” the council politically.

Lakes council was previously presented with “options and solutions” he believed it considered “somewhat unpalatable”.

This included the interest-free loan and so-called rates-swap idea: lowering Rotorua ratepayers’ regional council bills so the Lakes council could raise its rates and fund the scheme.

Thurston said his colleagues were committed to finding a solution for both councils.

Regional councillors Jane Nees and Kevin Winters – a former Rotorua mayor – wanted clarity on how the funding share would change if it were to contribute more.

Moraes said if Lakes raised its contribution to match the regional council at about $4.3m, Lakes would also carry the risk for further cost escalations.

Councillor Te Taru White asked what level of co-operation or consultation Lakes had with iwi and Te Arawa Lakes Trust.

Tapsell said it was “certainly adequate” and the discussion with the trust, as the lakebed owner, was ongoing.

Councillor Doug Leeder said the scheme concept began in 2012 and capital works in 2024, so inflation would have impacted the value of money by “40% to 50%” – with ratepayers footing the bill.

He raised whether what Lakes proposed would contravene the regional council’s decision, in its last Annual Plan, to lower Rotorua rates for the swap.

Tapsell and Moraes also spoke to the council about formalising a joint governance committee to collaborate on Rotorua growth and development.

Leeder said the relationship between the councils was productive, and the two would not resolve differences in the public forum.

A joint governance forum offered a place to “work through these issues”.

Tarawera ratepayers’ cost burden anxieties

Tarawera resident Tracey McLeod shared messages from residents about the “undue stress” of the scheme cost.

One said they were billed $12,000 in annual rates despite Tarawera not even having street lights.

Others attributed their high blood pressure to worrying about the scheme, and one said the lake seemed to be viewed as more important than the people on its shores.

McLeod said as costs escalated, so did anxiety.

“The stress continues to be unbearable.”

She said she had trawled through years of information about funding of this and other Rotorua sewerage schemes, and in her view, there were “discrepancies” and “overinflated costs” that required an inquiry and independent audit.

Rohan Wells, a former scientist living at Tarawera, told councillors of his concerns previously reported by Local Democracy Reporting, including questions about the scheme’s justification.

“In reality, don’t expect to see a water quality improvement as a result of reticulation … where is the cost-benefit analysis?”

He said he believed there was a “false narrative” about how much impact residents had on lake health, and said visitors contributed more – so the wider community should contribute more funding.

Leeder said Wells’ view was one interpretation and the council made decisions “on the best data we can”.

Lake Tarawera Ratepayers Association chairman Mike Allen at a Bay of Plenty Regional Council meeting. Photo / Laura Smith

Lake Tarawera Ratepayers Association chairman Mike Allen said feelings at the lake were “pretty high”.

Allen said he was there to support the Lakes council presentation, in order to reduce Tarawera residents’ contribution – which was “well above” that asked in other sewerage schemes in the region.

He believed that if a maximum per-household cost of $36,600 was achieved, 80% of the community would support it.

He considered there was precedent in the regional council supporting other schemes and asked it to “look to the strong regional and community benefits”.

Lakes councillors Karen Barker, Robert Lee and Conan O’Brien also attended, as did senior council staff Stavros Michael and Jean-Paul Gaston.

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Laura Smith is a Local Democracy Reporting journalist based at the Rotorua Daily Post. She previously reported general news for the Otago Daily Times and Southland Express, and has been a journalist since 2019.

- LDR is local body journalism co-funded by RNZ and NZ On Air.