Agenda of Finance and Council Controlled Organisations Committee

Notice of Meeting:

I hereby give notice that an ordinary meeting of the Finance and Council Controlled Organisations Committee will be held on:

Date: Tuesday 2 July 2019

Time: 1.00 pm

Venue: Edinburgh Room, Municipal Chambers, The Octagon, Dunedin

Sue Bidrose

Chief Executive Officer

Finance and Council Controlled Organisations Committee

PUBLIC AGENDA

MEMBERSHIP

Chairperson	Cr Mike Lord
Deputy Chairperson	Cr Doug Hall
Members	Cr David Benson-Pope	Mayor Dave Cull
	Cr Rachel Elder	Cr Christine Garey
	Cr Aaron Hawkins	Cr Marie Laufiso
	Cr Damian Newell	Cr Jim O'Malley
	Cr Chris Staynes	Cr Conrad Stedman
	Cr Lee Vandervis	Cr Andrew Whiley
	Cr Kate Wilson

Senior Officer Dave Tombs, General Manager Finance and Commercial

Governance Support Officer Lynne Adamson

Lynne Adamson

Governance Support Officer

Telephone: 03 477 4000

Lynne.adamson@dcc.govt.nz

www.dunedin.govt.nz

Note: Reports and recommendations contained in this agenda are not to be considered as Council policy until adopted.

Finance and Council Controlled Organisations Committee

2 July 2019

Part A Reports

Financial Result - Period Ended 31 May 2019

Department: Finance

EXECUTIVE SUMMARY

1 This report provides the financial results for the period ended 31 May 2019 and the financial position as at that date.

2 Note that the associated budget has been adjusted for the additional capital expenditure approved by Council at the meeting 30 October 2018, along with any related revenue.

RECOMMENDATIONS

That the Committee:

a) Notes the Financial Performance for the period ended 31 May 2019 and the Financial Position as at 31 May 2019.

BACKGROUND

3 This report provides the financial statements for the period ended 31 May 2019. It includes reports on: financial performance, financial position, cashflows and capital expenditure. The operating result is also shown by group, including analysis by revenue and expenditure type.

DISCUSSION

4 Operating revenue exceeded budget primarily due to increased activity in building services, cemeteries & crematorium and parking operations.

5 Grants revenue was ahead of budget primarily due to additional NZTA income generated from higher than expected capital expenditure on roading projects – cycleways, peninsula widening and flood reinstatement. The result also included the initial payment from the Provincial Growth Fund.

6 Overall expenditure was unfavourable to budget primarily due to: higher depreciation resulting from asset revaluations carried over from 2017/18 (Three Waters and Transport), unbudgeted project costs (eg: 2GP and Project Management Office) and additional personnel costs including unbudgeted recruitment activity, costs associated with 2GP and a budget shortfall in Aquatics.

7 These unfavourable variances were partially offset by lower than expected interest costs due a favourable floating interest rate.

8 The year to date Waipori result was ahead of budget, with fair values gains across most investment portfolios.

9 Capital expenditure was running ahead of the revised budget, primarily driven by activity in the infrastructure group (Peninsula Widening & Ross Creek) and the recent property purchases.

10 The graphs in attachment A, show reported metrics in line or better than expected.

OPTIONS

11 Not applicable.

NEXT STEPS

12 Not applicable.

Signatories

Author:

Gavin Logie - Financial Controller

Lawrie Warwood - Financial Analyst

Authoriser:

Dave Tombs - General Manager Finance and Commercial

Attachments

	Title	Page
⇩a	Summary Financial Information	19
⇩b	Statement of Financial Performance	20
⇩c	Statement of Financial Position	21
⇩d	Statement of Cashflows	22
⇩e	Capital Expenditure Summary	23
⇩f	Borrowing and Investment Policy	24
⇩g	Operating Variance Summary	25
⇩h	Financial Review	27

SUMMARY OF CONSIDERATIONS

Fit with purpose of Local Government

The financial expenditure reported in this report relates to providing local infrastructure, public services and regulatory functions which contribute to the well-being of the community.

Fit with strategic framework

	Contributes	Detracts	Not applicable
Social Wellbeing Strategy	☐	☐	☒
Economic Development Strategy	☐	☐	☒
Environment Strategy	☐	☐	☒
Arts and Culture Strategy	☐	☐	☒
3 Waters Strategy	☐	☐	☒
Spatial Plan	☐	☐	☒
Integrated Transport Strategy	☐	☐	☒
Parks and Recreation Strategy	☐	☐	☒
Other strategic projects/policies/plans	☐	☐	☒

This report has no direct contribution to the Strategic Framework, although the financial expenditure reported in this report has contributed to all of the strategies.

Māori Impact Statement

There are no known impacts for tangata whenua.

Sustainability

There are no known implications for sustainability.

LTP/Annual Plan / Financial Strategy /Infrastructure Strategy

This report fulfils the internal financial reporting requirements for Council.

Financial considerations

Not applicable – reporting only.

Significance

Not applicable – reporting only.

Engagement – external

There has been no external engagement.

Engagement - internal

The report is prepared as a summary for the individual department financial reports.

Risks: Legal / Health and Safety etc.

There are no known risks.

Conflict of Interest

There are no known conflicts of interest.

Community Boards

There are no known implications for Community Boards.

Finance and Council Controlled Organisations Committee

2 July 2019

DCC Submission on the Climate Change Response (Zero Carbon) Amendment Bill

Department: Community and Planning and Corporate Policy

EXECUTIVE SUMMARY

1 This report seeks approval of a Dunedin City Council (DCC) submission to the Parliamentary Environment Select Committee on the Climate Change Response (Zero Carbon) Amendment Bill. A draft DCC submission is attached to this report as Attachment A.

RECOMMENDATIONS

That the Committee:

a) Approves the DCC submission to the Environment Select Committee on the Climate Change Response (Zero Carbon) Amendment Bill.

BACKGROUND

2 The purpose of the Climate Change Response (Zero Carbon) Amendment Bill is to provide a framework by which New Zealand can develop and implement clear and stable climate change policies that contribute to the global effort under the Paris Agreement.

3 The Bill sets a greenhouse gas emission target and require future government to continue meeting this target into the future. It seeks to:

a) Set up the Climate Change Commission, an independent body that will advise and support the government to reach the targets

b) Create a requirement that the government sets emission budgets every five years that will act as ‘stepping stones’ towards the goal of carbon zero by 2050

c) Create a requirement that the government understands the risk of climate change (for example, rising sea levels) and produces plans to address these.

4 The Bill would be an amendment to the existing Climate Change Response Act 2002 so all key climate-related legislation can be covered under one Act.

5 Submissions close on Tuesday 16 July 2019.

DISCUSSION

6 The DCC submission on the Climate Change Response (Zero Carbon) Amendment Bill provides the Dunedin context on climate change commitments and notes the potential issues and gaps with the Bill that needs to be addressed.

7 The DCC submission suggests the proposed Climate Change Commission should have more power to drive implementation and achievement of the targets and budgets set within this Bill. A recommendation is to allow the Commission to have similar powers to the Reserve Bank of New Zealand (as an example) to provide a mechanism for achieving the targets, regardless of government direction at any time.

8 The DCC submission also discusses the lack of requirement for central government to collaboratively work with local government on the national adaptation plan. The Bill lacks direction for partnership with local government to create and monitor the national adaptation plan, which is a risk to local government and the contributions made so far with communities for adaptation.

9 Another concern noted in the submission is the lack of concrete responsibility and consequence for the failure to meet the set targets and budgets. The current Bill poses potential litigation risks and challenges for local government due to its leniency on the enforcement of this legislation. The DCC recommends that central government provide guidance and advice to support councils in meeting their obligations and minimise these risks.

OPTIONS

Option One (Recommended Option) – Submit on the Climate Change Response (Zero Carbon) Amendment Bill

10 Approve the DCC submission on the Climate Change Response (Zero Carbon) Amendment Bill, with any suggested amendments, to the Environment Select Committee.

Advantages

· Enables the DCC to provide feedback on legislation that will affect its climate change commitments and obligations.

Disadvantages

· There are no identified disadvantages for this option.

Option Two – Do not submit on the Climate Change Response (Zero Carbon) Amendment Bill

11 Do not submit a DCC submission on the Climate Change Response (Zero Carbon) Amendment Bill.

Advantages

· There are no identified advantages for this option.

Disadvantages

· Missed opportunity to provide feedback on legislation that will affect the DCC’s climate change commitments and obligations.

NEXT STEPS

12 If the Committee approves the draft submission it will be sent to the Environment Select Committee for consideration by 16 July 2019.

Signatories

Author:

Jessie Wu - Policy Advisor

Hoani Yates - Policy Advisor

Maria Ioannou - Corporate Policy Manager

Authoriser:

Nicola Pinfold - Group Manager Community and Planning

Sandy Graham - General Manager City Services

Attachments

	Title	Page
a	DCC Submission on the Climate Change Response (Zero Carbon) Amendment Bill (Under Separate Cover)

SUMMARY OF CONSIDERATIONS

Fit with purpose of Local Government

This decision enables democratic local decision making and action by, and on behalf of communities, and promotes the social, economic, and environmental well-being of communities in the present and for the future.

Fit with strategic framework

	Contributes	Detracts	Not applicable
Social Wellbeing Strategy	☒	☐	☐
Economic Development Strategy	☒	☐	☐
Environment Strategy	☒	☐	☐
Arts and Culture Strategy	☒	☐	☐
3 Waters Strategy	☒	☐	☐
Spatial Plan	☒	☐	☐
Integrated Transport Strategy	☒	☐	☐
Parks and Recreation Strategy	☒	☐	☐
Other strategic projects/policies/plans	☒	☐	☐

This submission has been developed in line with the goals and objectives of the strategic framework.

Māori Impact Statement

There are no known impacts for tangata whenua.

Sustainability

The Bill will have long-term implications on the DCC to contribute to the mitigation targets and budgets and national adaptation plan.

LTP/Annual Plan / Financial Strategy /Infrastructure Strategy

The legislation may have impacts on long term plans/annual plans going forward as the DCC may need to consider budgeting for meeting the commitments outlined in the Bill.

Financial considerations

No known financial implications.

Significance

This decision is considered of low significance in terms of the Council’s Significance and Engagement Policy.

Engagement – external

No external engagement was undertaken for this submission.

Engagement - internal

The draft submission was circulated for feedback across the DCC.

Risks: Legal / Health and Safety etc.

There are no identified risks.

Conflict of Interest

There are no known conflicts of interest.

Community Boards

This submission may be of interest to Community Boards.

Finance and Council Controlled Organisations Committee

2 July 2019

Terms of Reference - Climate Change Advisory Panel

Department: Corporate Policy

EXECUTIVE SUMMARY

1 This report establishes the Climate Change Advisory Panel (the Panel) and the terms of reference (at Attachment A), as requested during the Annual Plan Deliberations in May 2019.

RECOMMENDATIONS

That the Committee:

a) Approves the establishment of a Climate Change Advisory Panel.

b) Approves the terms of reference for the Climate Change Advisory Panel.

c) Approves that the chair of the Climate Change Advisory Panel be the Deputy Chair of the Infrastructure Network and Services Committee – Cr O’Malley.

d) Approves that the Deputy Chair of Community and Culture Committee – Cr Laufiso, and Deputy Chair of the Planning and Environment Committee – Cr Newell be appointed to the Climate Change Advisory Panel.

e) Confirms the Climate Change Advisory Panel will report to the Planning and Environment Committee.

BACKGROUND

2 At the Annual Plan Deliberations meeting (29 – 31 May), Council resolved to establish and resource a ‘Climate Resilience Work Programme’ to ensure a strategic and coordinated approach to meeting the climate change mitigation and adaptation needs for Dunedin.

3 The resolution was passed as follows:

“That the Council:

a) Approves establishing and commencing the delivery of a detailed work programme for climate mitigation and adaptation at a cost of $525,000 for 2019/20 and $572,000 in 2021/22, with progress reported to Council.

The Council voted by division:

For: Crs David Benson-Pope, Rachel Elder, Christine Garey, Doug Hall, Aaron Hawkins, Marie Laufiso, Damian Newell, Jim O’Malley, Andrew Whiley, Kate Wilson and Mayor Cull (11)

Against: Crs Mike Lord and Lee Vandervis (2).”

4 Later at the same meeting, the Mayor proposed that a steering group on climate change be established with Councillors Jim O’Malley, Marie Laufiso and Damian Newell as members.

DISCUSSION

An advisory panel

5 In line with the DCC’s Committee Structure and Delegations Manual, this steering group would take the form of a council advisory panel.

6 Advisory panels have no decision-making powers but do have an advisory and fact-finding role. Advisory panels may make recommendations on matters within the scope of its terms of reference, back to an appointed committee or council.

Reporting

7 It is recommended the Climate Change Advisory Panel report to the Planning and Environment Committee as this work falls within the delegation of this committee.

OPTIONS

Option One – That Council approves the establishment of a Climate Change Advisory Panel (Recommended Option)

8 That Council approves the establishment of a Climate Change Advisory Panel and its terms of reference.

Advantages

· Provides governance advice for the Climate Resilience Work Programme as it progresses, ensuring alignment with the approved strategic direction for this work.

Disadvantages

· No perceived disadvantages.

Option Two – Council does not approve the establishment of a Climate Change Advisory Panel

Advantages

· No perceived advantages.

Disadvantages

· No governance input for the Climate Resilience Work Programme as it progresses.

· Risk of misalignment with the approved strategic direction for this work.

NEXT STEPS

8 If approved, the first meeting of the Advisory Panel will be scheduled.

Signatories

Author:	Maria Ioannou - Corporate Policy Manager
Authoriser:	Sandy Graham - General Manager City Services

Attachments

	Title	Page
⇩a	Draft Terms of Reference for Climate Change Advisory Panel	43

SUMMARY OF CONSIDERATIONS

Fit with purpose of Local Government

This decision promotes the social, economic, cultural and environmental well-being of communities in the present and for the future.

Fit with strategic framework

	Contributes	Detracts	Not applicable
Social Wellbeing Strategy	☒	☐	☐
Economic Development Strategy	☒	☐	☐
Environment Strategy	☒	☐	☐
Arts and Culture Strategy	☐	☐	☒
3 Waters Strategy	☒	☐	☐
Spatial Plan	☒	☐	☐
Integrated Transport Strategy	☒	☐	☐
Parks and Recreation Strategy	☒	☐	☐
Other strategic projects/policies/plans	☒	☐	☐

This proposal contributes to the majority of strategies but, in particular, the Environment Strategy by acting to minimise the effects climate change will have on Dunedin.

Māori Impact Statement

There are no known implications for tangata whenua.

Sustainability

There are strong implications for sustainability that include offsetting climate change impacts (environmental), and over time minimising financial aid needed to communities who face the climate change related challenges in the future (economic and social).

LTP/Annual Plan / Financial Strategy /Infrastructure Strategy

There are no implications.

Financial considerations

There are no financial implications.

Significance

The decision to establish an advisory panel is considered to be of low significance in terms of the Council’s Significance and Engagement Policy.

Engagement – external

There has been no external engagement.

Engagement - internal

There has been no internal engagement.

Risks: Legal / Health and Safety etc.

There are no known risks.

Conflict of Interest

There are no known conflicts of interest.

Community Boards

There are no direct implications for Community Boards.

	Title	Page
⇩a	Elected Members' Register of Interest	7