Agenda of Annual Plan Council

Annual Plan Council

29 January 2020

Part A Reports

An overview of the draft budget for 2020/21

Department: Corporate Policy and Finance

EXECUTIVE SUMMARY

1 The purpose of this report is to provide an overview of the draft operating budget for the Annual Plan 2020/21, effectively ‘year 3’ of the 10 year plan 2018-2028.

2 The report highlights new challenges for maintaining DCC activities and assets in a growth environment, as well as the budget pressures associated with decreased revenue from the Green Island Landfill.

3 The draft budget for 2020/21 proposes a rate increase of 4.3% to maintain existing levels of service and an increase of 2.2%, to directly offset the loss of surplus from the Green Island Landfill.

4 This would bring the 2020/21 overall rate increase to 6.5%, which is required in order to maintain levels of service and deliver a balanced budget.

RECOMMENDATIONS

That the Council:

a) Adopts the draft 2020/21 operating budget for the DCC overall as shown/amended at Attachment A for the purposes of developing the Annual Plan 2020/21 and engaging with the community.

b) Notes that any resolution made in this section of the meeting may be subject to further discussion and decision by the meeting.

BACKGROUND

5 The DCC is now entering the third year of the current 10 year plan for 2018-2028, which was adopted in 2018. The 10 year plan outlines DCC’s investments in the city as well as budgets for the cost of the day to day activities to keep the city safe and well maintained, including major projects to alleviate the increasing risks of flooding and improve the transport network.

6 There have been significant changes in Dunedin since 2018. The population is growing at a faster rate than previously planned for, with Dunedin now being reclassified as a medium growth city. Building activity is increasing, house prices have risen sharply, as has demand for rental accommodation and social housing. These pressures are anticipated to continue, intensified by major projects in the city like the Dunedin Hospital rebuild.

7 Growth in the city brings opportunities and investment, however managing growth creates new challenges for the DCC. Increases in development activity have positive impacts on DCC revenue from consenting and development contributions. However, social housing, waste management, integrated transport, capital delivery, asset management as well as review of existing operations and service levels will all need to be considered. These challenges will be addressed over the coming year through the development of the next 10 year plan, for 2021-2031.

DISCUSSION

8 The DCC’s Financial Strategy (Attachment B) was written at a time of low growth and will be revisited as part of the development of the next 10 year plan. The Financial Strategy attempts to balance the competing tensions of affordability, maintaining assets and investing for the future.

9 It has become increasingly challenging to deliver existing services at existing service levels to the community within the Financial Strategy limits. The main pressure is from decreased revenue from the Green Island Landfill, as well as increasing costs associated with maintaining services and the need to increase depreciation funding to enable the DCC to deliver on its asset renewal programme.

10 The DCC’s rate increases across the 10 year plan are limited as follows:

- Year 1: limited to no more than 8%

- Years 2-10: limited to 5% on average annually over the period.

11 The Year 1 rate increase was 7.8% (2018/19) and Year 2 (2019/20) was 5.3%.

Balanced budget

12 The Local Government Act 2002 requires councils to have a balanced budget, which means they need to ensure each year’s operating income is enough to meet that year’s operating expenses. The proposed rate increase delivers a balanced budget while maintaining current levels of service.

13 The Financial Strategy aims for total operating surplus greater than zero for the 10 year period. This is when certain non-cash items are excluded (vested assets and increases in the value of the Waipori Fund and investment property portfolio).

14 The net surplus in the draft 2020/21 budget is $100k. When vested assets and increases in the value of the Waipori Fund are excluded, the net surplus becomes a deficit of $4.650 million, a reduction of $10.272 million on the current year. Contributing factors are an increase in depreciation expense and a reduction in income from the New Zealand Transport Agency (NZTA) relating to capital expenditure.

15 The Financial Strategy also aims for total cashflow from operations for the 10 year period to fully fund depreciation, while retaining the Waipori Fund is seen as a natural offset to DCC borrowings. The fund is to be inflation proofed before any cash distribution to DCC.

Draft operating budget

16 The draft operating budget for 2020/21 provides for the day-to-day running of all the activities and services the DCC provides such as core water and roading infrastructure, waste management, parks, pools, libraries, galleries and museums. The draft budget includes operating expenditure of $321.125 million (refer to Attachment A).

17 Each of the DCC’s groups of activities have developed a draft operating budget. The key changes in funding sources and expected costs of delivery are explained in the group operating budget reports.

18 Staffing costs have budgeted increases in 2020/21. Some new positions, such as building consent processing, have a supporting revenue stream. Other positions are largely required to ensure maintenance of services in a growth environment - particularly in the core infrastructure areas.

19 There are no changes to levels of services proposed in the draft budget. However, maintaining existing levels of service in a growth environment presents new challenges which need to be addressed. A review of service levels will be incorporated into the development of the next 10 year plan.

20 As DCC asset management continues to improve, this is highlighting a corresponding need for further discussion about asset investment. In order to keep the operational rate increase at no more than 4.3% (excluding the 2.2% to offset the decrease in landfill revenue), some new asset assessment work has been excluded from the 2020/21 budget.

Green Island Landfill planning

21 The Waste Futures project addresses Council’s strategic approach to waste management and minimisation, inclusive of a circular economy, and includes further developments to kerbside recycling. As part of the project the DCC is developing a new landfill at Smooth Hill.

22 Traditionally, operating surpluses generated by the Green Island Landfill have been used to offset other DCC activities. Less waste taken to the landfill in 2019/20 has resulted in less revenue for the DCC, informing the development of the 2020/21 draft budget. A 2.2% increase to rates has been incorporated into the 2020/21 draft budget to account for the projected loss of operating surplus of $3.5 million.

23 The reduction in waste being taken to the Green Island Landfill is a challenge for the DCC due to loss of revenue. However, the reduction serves to extend the life of the Green Island Landfill, while DCC works to commission a new landfill.

Revenue

24 The draft operating budget for 2020/21 (Attachment A) shows overall rates revenue increasing by $10.241 million, which is 6.5% higher than 2019/20.

25 External revenue has decreased by $4.649 million, -5.7%. The main change relates to a reduction in revenue generated by the Green Island Landfill.

26 Fees and charges have increased by 3% in most cases. There are exceptions to this, for example, where the fee is set by legislation. These are discussed in the group budget reports. There will be a full review of fee levels as part of the 10 year plan work programme.

27 The draft budget includes a reduction in external capital revenue of $7.130 million, -22.9%. This relates to the capital expenditure programme for Transport projects. The level of external New Zealand Transport Authority (NZTA) funding is reduced as a result of timing changes in the capital programme, as well as a shortfall in requested NZTA renewal funding, which has resulted in reduced renewal expenditure for the 2020/21 year.

Expenditure

28 The draft budget shows an increase in personnel costs of $4.833 million, 7.4%. This increase incorporates a general increase across all staff salaries, a reduction in the allowance for vacant positions, an allowance for incremental performance management steps and an increase in full time equivalent staff (FTE).

29 Some of the new positions have a corresponding revenue stream, such as building consent processing. However, other positions are largely to ensure adequate capacity to deliver services in a growth environment, particularly in core infrastructure areas. The key changes include:

a) Infrastructure services - additional resource in the Three Waters group is included to address resilience issues including standby rosters and succession planning for an ageing workforce with specialist skills. Savings to partially offset these changes are reflected in reduced contractors, as mechanical and electrical maintenance is brought in house. (7 FTE)

b) Consent processing – additional resource in Building Services and Resource Consent teams is included to respond to increased growth activity in the city. The majority of these costs are recovered by external revenue. (6.2 FTE)

c) Operations – additional resource for housing support in Community Development and Events and maintenance support in Aquatic Services is offset by savings in operational budgets. (2.3 FTE)

d) Community support – additional resource in Community Development and Events is included for event support and community engagement in South Dunedin and the coastal areas. (1.5 FTE)

e) Health and safety – following a legislative change, additional resource in Aquatic Services is included to ensure staffing adequately addresses all health and safety requirements in the delivery of Aquatic Services. (3.3 FTE)

f) Operational support – additional resource is included across the following operational areas to increase capacity in a growth environment.

i. Infrastructure support – Urban development and 2GP support (2.6 FTE), contract management and support in Three Waters and Transport (5.2 FTE)

ii. Organisational support (HR and Comms) (2 FTE)

iii. Mayoral strategic advice (1.5 FTE)

g) Cost recovery – there is a reduction in resource required for externally funded positions relating to the biennial staffing for the Masters Games and changes relating to transfer of the delivery of the Otago Regional Business Partnership to another provider, as well as fixed term positions ending. (-4.5 FTE)

30 Operations and maintenance costs have decreased by $3.129 million, -4.4%. The main changes are due to:

a) Waste Management - a reduction of $1.673 million relates to the reduction in costs associated with operating the Green Island Landfill, as the volume of waste decreases.

b) Governance and Support Services group – a reduction of $529k includes the removal of election costs and a reduction in project management costs in Business information Services as these costs move into the capital expenditure programme.

c) Economic Development group – a reduction of $392k is due to reduced external funding related to changes relating to transfer of the delivery of the Otago Regional Business Partnership to another provider.

d) Three Waters group – a reduction of $359k relates to changes made to build resilience within the infrastructure workforce, with less reliance on contractors due to increasing internal capacity in the mechanical and electrical maintenance area.

31 Occupancy and property-related costs such as rates, insurance, energy and cleaning costs have increased by $1.945 million, 7.9%.

32 Depreciation has increased by $5.306 million, 7.7% reflecting the impact of the latest revaluations as well as the capital expenditure programme. In the current 10 year plan, depreciation was projected to be fully funded from operating income. However, there are now challenges to fully fund depreciation from operating income, due to decreased revenue and a growing infrastructure asset base (as a result of current levels of capital expenditure) as well as increasing replacement costs for the existing asset base, resulting from the recent revaluations.

Unfunded items

33 In the preparation of the draft budget, group managers have trimmed costs to make savings and have found efficiencies in order to keep the proposed rate increase within the limits of the Financial Strategy (Attachment B).

34 In a rapidly changing growth environment, assumptions that underpin the current 10 year plan are changing and there are several items which are not currently funded.

35 Collaborative work is underway between the DCC and Otago Regional Council (ORC) to investigate improvements to Dunedin’s public transport system, encouraging behaviour shift away from single occupancy vehicle usage and investigating changes to the fare structure. It is anticipated a subsidised fare arrangement, similar to the Queenstown Lakes District Council’s (QLDC) subsidy to ORC ($600k in the QLDC 2017/18 Annual Plan), has the potential to increase bus patronage and achieve similar outcomes. At this stage, this item is unfunded in the draft 2020/21 budget, pending further discussion. Options are being progressed to implement cheaper fares in the coming year.

36 Funding for the following items has not been included in the 2020/21 draft budget and will need to be considered as part of the development of the 2021-2031 10 year plan.

a) Options for transport trials – any options emerging from collaborative transport work with the ORC.

b) Tracks – any new funding to support increased maintenance, upgrade or development of city tracks.

c) Waterfront project – potential operational resource to enable project planning to progress.

d) Comprehensive property assessments – additional resource for maintenance on civic buildings, seismic reviews and asbestos identification and potential remediation.

37 There are several other factors which may add budget pressure to existing levels of service that will need to be incorporated into the development of the 2021-2031 10 year plan, if and when they arise.

a) Waste management – Central Government is currently consulting on Landfill Levies and the Emissions Trading Scheme. The landfill levy looks likely to increase from $10 to around $50-$60 per tonne, which will be accompanied by an increase in the costs of NZ Units in the Emissions Trading Scheme. This would have significant impact of the cost of landfill disposal.

b) Road maintenance – a new road maintenance contract is currently being negotiated, to commence on 1 May 2020. This is a significant contract, representing the majority of Transport Group’s operating budget. Costs have been estimated using the current contract as a baseline, however final costings are yet to be determined and the model for delivery is changing (from a ‘lump sum’ outcome approach, to a ‘measure and value’ approach of payment for actual works).

c) Social housing - future options to fund social housing need to be further explored to ensure that the DCC’s Community Housing portfolio operates as break-even. In the draft 2020/21 budget, the Community Housing portfolio is forecast to return a deficit of $600k. This is further discussed in the separate Community Housing – Funding Report. Review of Council’s strategy and policy settings around social housing may have ongoing budget impact.

d) Water Reform – Central Government have proposed, and in some cases are in the process of implementing, reform of the Three Waters sector. This includes: initiatives to improve stormwater and wastewater environmental standards and regulation; more stringent drinking water standards; a new regulator with significant enforcement power; and potential reorganisation of the sector. The specific impacts of the proposed changes are not yet clear, however they may generate additional cost pressure.

Revaluations and rate distribution

38 Historically, property revaluations have not had a significant impact on how rates are distributed between properties. This time, however, the increase in capital values of certain properties in the city will have a notable impact on the overall rate increase experienced by ratepayers.

39 This impact is due to the increase in some property values and the application of the DCC rating method. There are two types of rates – general rates (53%) and targeted rates (47%). The general rate is collected based on the capital value of the property (across six different property categories). Targeted rates (which fund particular activities) are either fixed charges or collected based on the capital value of the property.

40 The detail of the rating method and its application is covered in the Rating Method report.

Draft capital budget

41 When the current 10 year plan was developed, the total capital expenditure programme was $878.267 million. As part of the 2019/20 Annual Plan, the total capital programme was increased to $910.167 million, a number of infrastructure and property related projects were accelerated and some re-phased into later years. The 2020/21 budget in the 10 year plan was $104.224 million, but was increased to $128.433 million in the 2019/20 Annual Plan.

42 A preliminary review of the 2020/21 budget reduces the capital budget to $116.881 million with a number of property projects being accelerated, while other works have been re-phased into later years. A reduction in renewals expenditure in Roading and Footpaths reflects a shortfall in requested NZTA renewal funding for the 2020/21 year. A draft summary budget is provided in Attachment C, however a full review of the draft capital budget will be undertaken in time for Council consideration during the Annual Plan deliberations in May.

Community engagement

43 Local authorities are not required to consult on Annual Plans if the plan ‘does not include significant or material differences from the content of the long term plan for the financial year to which the proposed annual plan relates’. However, the development of the Annual Plan offers an opportunity to discuss Council activities for the year ahead and serves as an early engagement opportunity to inform the development of the 2021-2031 10 year plan.

44 There will be a report to Council in February outlining a recommended approach to community engagement. It is expected this will be similar to previous years, there will be a range of opportunities for the public to engage and this will include hearings.

NEXT STEPS

45 This report outlines current challenges associated with maintaining DCC activities and assets in a growth environment, with the budget pressure associated with loss of revenue from the Green Island Landfill. The draft operating budget for 2020/21 presents an overall 6.5% rate increase.

46 If Council adopts the draft budget, DCC will be able to maintain existing levels of service and deliver a balanced budget for 2020/21.

47 Should the Council wish to adopt the draft budget with amendments, there are areas where changes could be made, these include:

a) Requesting DCC stop current activities or reduce levels of service in specific areas.

b) Adding in any additional funding for currently unfunded items.

48 The next steps are that the council will need to consider the rating method and the draft group budgets before confirmation of draft budgets for community engagement purposes.

Signatories

Authoriser:

Sue Bidrose - Chief Executive Officer

Attachments

	Title	Page
⇩a	2020/21 draft operating budget	31
⇩b	DCC Financial Strategy 2018-2028	32
⇩c	10 year draft capital expenditure budget	42

SUMMARY OF CONSIDERATIONS

Fit with purpose of Local Government

The development of the Annual Plan 2020/21 enables democratic local decision making and action by, and on behalf of, communities; and promotes the social, economic, environmental, and cultural well-being of Dunedin 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	☒	☐	☐

Māori Impact Statement

The DCC works in partnership with mana whenua across a range of projects and activities outlined in the Annual Plan 2020/21, and provides opportunities for all Māori to participate and contribute to decision-making processes.

Sustainability

Sustainability is an underlying principle of the DCC’s strategic framework. Activity in the Annual Plan 2020/21 supports the DCC to embed the principles of sustainability across DCC work outlined in the 10 Year Plan.

LTP/Annual Plan / Financial Strategy /Infrastructure Strategy

This report provides an update on the development of the Annual Plan 2020/21 and implications for the 10 Year Plan.

Financial considerations

The financial implications of the draft budgets are discussed in this report, as well as the group budget reports.

Significance

There will be full engagement on the 2020/21 draft budget as part of the Annual Plan process, which will cover any issues of significance.

Engagement – external

The content of the Annual Plan 2020/21 is of interest to the community and there will be a full community engagement process.

Engagement - internal

Staff and managers from across the Council have been involved in the development of the draft budgets.

Risks: Legal / Health and Safety etc.

Refer to the group budget reports and options reports for specific risks considered in the development of the draft budget.

Conflict of Interest

There are no known conflicts of interest.

Community Boards

Community Boards have an opportunity to present any issues for their community as part of the 2020/21 Annual Plan development. Staff are working with community boards to develop new Community Board Plans to inform the Annual Plan and next 10 year plan.

Annual Plan Council

29 January 2020

2020-21 Rating Method

Department: Finance

EXECUTIVE SUMMARY

1 The draft budget as presented for 2020-21 proposes an overall increase in rates of 6.5%. This increase in rates is collected using the rating method. The proposed rates incorporate the budget increase and changes in the rating database (new improvements, new homes and the impact of the 2019 general revaluation).

2 The proposed changes to the rating method are discussed in this report. These include increases to the community services targeted rate (increase of 2.7%) and the stadium differentiated rates (increase of 2.8%).

3 The 2019 general revaluation has resulted in a redistribution of general rates between properties and property categories.

RECOMMENDATIONS

That the Council, for the purposes of community engagement:

a) Approves an increase in the community services targeted rate for the 2020-21 year of $6.50 to $247.00 including GST.

b) Approves an increase in the Stadium 10,000 plus seat differentiated rates for the 2020-21 year based on the June 2019 Local Government Cost Index of 2.8%.

c) Approves the current rating method for the setting of all other rates for the 2020-21 year.

BACKGROUND

4 The purpose of this report is to describe certain aspects of the current rating method, detail the proposed changes to the rating method for the 2020-21 year and discuss the impact of the 2019 general revaluation.

5 Please note that unless specified, all rating figures in this report are GST inclusive.

DISCUSSION

6 The overall increase in rates to be collected is driven by the draft budget for 2020-21 which proposes a 6.5% increase. This increase in rates is collected using the rating method.

7 The rating method comprises two main elements, general rates and targeted rates, as demonstrated on Attachment A. Attachment A provides a summary of current and proposed rates, provides details of the individual rates and the amount collected from each rate. Attachment B, summary information, provides a summary of fixed charges, general rates and total rates.

8 DCC rates are made up of general rates (53%) and targeted rates (47%). Targeted rates are made up of fixed charges (78%) and rates based on CV (22%). When property values change as a result of a revaluation, the largest impact relates to the general rate.

9 The general rate is collected as a rate in the dollar on the capital value (CV) of each property. The Council sets the general rate differentially for six property categories, residential, lifestyle, commercial, farmland, residential Heritage Bed and Breakfast establishments and the Stadium.

10 A differential, described as a factor, is the degree to which the rate (the cents in the dollar) on each category of property is higher or lower than residential property. For example, the rate paid by commercial properties for the current year is 2.45 times more than the rate paid by residential properties.

11 Targeted rates fund particular activities and are either fixed charges, ie the same amount per property, or collected as a rate in the dollar on the CV of each property.

12 The impact of a rates increase on individual properties is driven by the budget increase, the rating method, changes in the property database (for example, new improvements or new houses) and the 2019 general revaluation.

Community Services Rate

13 The Council has a community services targeted rate (CSTR) which funds the Botanic Garden and part of the Parks and Reserves activity. The CSTR is a fixed charge on all rateable properties and is increased annually, last year by 3%. In previous years the increase has been based on the Local Government Cost Index (LGCI). Allowing for both the June 2019 LGCI of 2.8% and rounding to the nearest 50 cents would increase this from $240.50 to $247.00 for the 2020-21 year.

Stadium Rates

14 The Council has a rating differential for the Forsyth Barr Stadium for the general rate, the economic development/tourism rate, the capital value based drainage rate and the capital value based fire protection rate. Since the 2013-14 year, the differentiated stadium rates have been inflation adjusted annually. For the 2020-21 year, it is proposed to increase these rates by the June 2019 LGCI of 2.8%.

Revaluation Impact

15 Dunedin properties were revalued in 2019 and these property values form the basis for rating for the 2020-21 rating year.

16 Overall, there has been a 33.5% increase in capital value (CV) of Dunedin properties. The table below shows the overall change in CV by property category for all properties that pay the general rate.

	Old Capital Value^{^[1]} 2019-20	% of CV	New Capital Value 2020-21	% of CV	CV Inc/(Dec)	% Inc/ (Dec)
Residential	15,712,310,600	67.9	21,988,027,680	71.2	6,275,717,080	39.9
Lifestyle	1,441,383,000	6.2	1,903,888,500	6.2	462,505,500	32.1
Commercial	4,148,865,350	17.9	5,028,132,150	16.3	879,266,800	21.2
Farmland	1,660,043,050	7.2	1,785,324,750	5.8	125,281,700	7.5
Heritage B&Bs	4,895,000	0.0	5,640,000	0.02	745,000	15.2
Stadium	181,500,000	0.8	187,3000,000	0.6	5,800,000	3.2
Total	23,148,997,000	100.0	30,898,313,080	100.0	7,749,316,080	33.5

17 The impact on rates paid by individual properties depends on whether a property’s CV has changed by more than, or less than, the overall increase or decrease in CV. For example, if the CV of a particular property increased by more than the overall increase, then the general rate for this property would increase by more than the overall increase.

Overall Impact

18 The following table shows the overall rates income (including GST) by property category for 2019-20 and 2020-21.

Category	2019-20 ($’000)	2020-21 ($’000)	$ change ($’000)	% change
Residential	115,646	126,471	10,825	9.4%
Lifestyle	5,689	6,111	422	7.4%
Commercial	53,642	54,674	1,032	1.9%
Farmland	5,241	4,739	(502)	-9.6%
Total	180,218	191,995	11,777	6.5%

19 Attachment C provides sample property rate changes for each category of property. The sample property rate changes incorporate:

· The forecast rate increase of 6.5%,

· An increase of $6.50 in the community services rate and

· An increase of 2.8% in the differentiated rates paid by the Stadium 10,000 plus seat.

Rate Maximum

20 Under the Local Government (Rating) Act 2002, certain rates must not exceed 30% of total rates revenue. This includes the use of a uniform annual general charge and any targeted rates that are set on a uniform basis excluding targeted rates set solely for water supply or sewage disposal. Based on the draft budgets, these rates represent 25% of total rates revenue.

OPTIONS

21 No options are provided as this report is giving effect to the current rating method and previous decisions of the Council.

NEXT STEPS

22 If adopted, the proposed rating method will be included in the supporting documentation that accompanies the draft 2020-21 budget.

23 While the Council is engaging with the community on the draft 2020-21 budget, rate account information will be available on the DCC website that shows the proposed rating impact by individual rate account.

Signatories

Author:	Carolyn Allan - Senior Management Accountant
Authoriser:	Gavin Logie - Financial Controller

Attachments

	Title	Page
⇩a	Summary of current and proposed rates	49
⇩b	Summary information	50
⇩c	Sample property rates	51

SUMMARY OF CONSIDERATIONS

Fit with purpose of Local Government

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	☒	☐	☐

Māori Impact Statement

Sustainability

LTP/Annual Plan / Financial Strategy /Infrastructure Strategy

The proposed rating method will be set out with the draft 2020-21 budget material during the community engagement period.

Financial considerations

The financial implications of the draft budgets are discussed in this report, as well as the group budget reports.

Significance

There will be full engagement on the 2020/21 draft budget as part of the Annual Plan process, which will cover any issues of significance.

Engagement – external

The content of the Annual Plan 2020/21 is of interest to the community and there will be a full community engagement process.

Engagement - internal

Staff and managers from across the Council have been involved in the development of the draft budgets.

Risks: Legal / Health and Safety etc.

Refer to the group budget reports and options reports for specific risks considered in the development of the draft budget.

Conflict of Interest

There are no known conflicts of interest.

Community Boards

Annual Plan Council

29 January 2020

Three Waters - 2020/21 Draft Budget

Department: 3 Waters

EXECUTIVE SUMMARY

1 This report provides an overview of the draft 2020/21 budgets for the Three Waters Group and includes the following activities:

· Water supply

· Sewerage and sewage (Wastewater)

· Stormwater.

RECOMMENDATIONS

That the Council:

a) Approves for the purposes of developing the Annual Plan 2020/21 and engaging with the community:

i) The draft 2020/21 operating budget for the Three Waters Group as shown/amended at Attachment A.

ii) The draft 2020/21 fees and charges schedules for Water and Wastewater as shown/amended at Attachment B.

Operating budget

Expenditure

Personnel costs

2 Personnel costs have increased by $1.107 million, 14%. This incorporates a general salary increase and an increase in resources to ensure revenue is collected more efficiently. Contracted resources in the mechanical and electrical maintenance area have been brought in house. Savings of $414k in operations and maintenance partially offset the overall personnel cost increase. The benefits of this change include the frequency of staff on standby rosters, planning for an ageing workforce and business resilience.

Operations and maintenance

3 Operations and maintenance costs have decreased by $359k, -3%. This incorporates $414k restructure savings to offset an FTE increase in the mechanical and electrical maintenance area. Also included is an increase in the piped network maintenance contract of $124k, this is driven by inflation and represents a 1.6% increase on the total value of the contact.

Occupancy costs

4 Occupancy costs have increased by $710k, 7%; reflecting $292k increases in rates and insurance, a 15% increase in electricity of $296k and $82k increase in fuel for waste generators and incinerators.

Depreciation

5 Depreciation has increased by $2.047m, 7%. The increase is due to revaluation and an overall growth in the Three Waters Group asset base.

Fees and charges

6 Compliance Monitoring, Re-Inspection and Consent Breaches, and Water Supply fees have increased mostly by 3% (Attachment A). Some exceptions include:

a) City-wide unit rates for wastewater are calculated on a formula for trade waste charges, using budgeted volume and cost information – changes range from -10% to +3%.

b) The tariff for water has been increased by 2.4% to $1.68 per cubic metre. This is based on cost recovery for water supply.

Levels of service

7 There are no changes proposed to the levels of service, performance measures and targets stated in the 10 year plan 2018-28 for the Three Waters Group in the 2020/21 year.

Signatories

Author:	Tom Dyer - Group Manager 3 Waters
Authoriser:	Simon Drew - General Manager Infrastructure Services

Attachments

	Title	Page
⇩a	Three Waters - Draft 2020/21 Operating Budget	57
⇩b	Three Waters - Draft 2020/21 Fees and Charges Schedule	58

SUMMARY OF CONSIDERATIONS

Fit with purpose of Local Government

This report enables democratic local decision making and action by, and on behalf of communities; and promotes the social, economic, environmental and cultural 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	☒	☐	☐

The Annual Plan 2020/21 contributes to objectives across the strategic framework, as it describes the Council’s activities, which are aligned to community outcomes. It also provides a long term focus for decision making and coordination of the Council’s resources, as well as a basis for community accountability. The activities of the Three Waters Group primarily contribute to the identified strategy above.

Māori Impact Statement

Sustainability

10 year plan /Annual Plan / Financial Strategy /Infrastructure Strategy

This report provides draft budgets for the Three Waters Group for inclusion in the Annual Plan 2020/21.

Financial considerations

The financial considerations are detailed in the report.

Significance

There will be full engagement on the 2020/21 draft budget as part of the Annual Plan process, which will cover any issues of significance.

Engagement – external

The content of the Annual Plan 2020/21 is of interest to the community and there will be a full community engagement process.

Engagement - internal

Staff and managers from across the Council have been involved in the development of the draft budgets.

Risks: Legal / Health and Safety etc.

There are no known risks.

Conflict of Interest

There are no known conflicts of interest.

Community Boards

Annual Plan Council

29 January 2020

Roading and Footpaths - 2020/21 Draft Budget

Department: Transport

EXECUTIVE SUMMARY

1 This report provides an overview of the draft 2020/21 budget for the Roading and Footpaths Group and includes the Transport activity.

2 An update on the resourcing of parking related-studies and business cases (including parking data) is also included in this report.

3 Progress on the trial of the central city bus loop is covered in a separate update report.

RECOMMENDATIONS

That the Council:

a) Approves for the purposes of developing the Annual Plan 2020/21 and engaging with the community:

i) The draft 2020/21 operating budget for the Roading and Footpaths Group as shown/amended at Attachment A.

ii) The draft 2020/21 fees and charges schedules for the Roading and Foothpaths Group as shown/amended at Attachment B.

Operating budget

Revenue

4 Operating Grants and subsidies have increased by $395k, 4%. This is due to the New Zealand Transport Authority (NZTA) subsidy on the vegetation contracts transferred from Parks Operations.

5 Capital Grants and subsidies have decreased by $7.130 million, 23% due to reduced funding as a result of timing changes in the capital expenditure programme as well as a shortfall in NZTA renewal funding resulting in reduced renewal expenditure.

Expenditure

Personnel costs

6 Personnel costs have increased by $264k, 6%. The increase incorporates a general salary increase and the addition of two full time equivalent staff for parking administration and contract management.

Operations and maintenance

7 Operations and maintenance costs have increased by $2.346 million, 17%. This is mainly due to two major contracts transferred from Parks Operations, the vegetation contract ($1.050 million) and greenspace berm maintenance contract ($625k). The balance is due to annual maintenance price escalation, committed traffic signal maintenance contracts and the facilitation cost of improved data on parking trends from parking sensors.

Consumables and general costs

8 Consumable and general costs have decreased by $458k, 14% mainly due to a decrease from major projects moving from indicative stages to implementation.

Depreciation

9 Depreciation has increased by $2.139 million, 10% due to revaluation. The new valuation reflects asset condition data and recent contract rates.

Fees and charges

10 Fees and charges for Transport have generally increased by 3% (with some rounding). A copy of the fees and charges schedules for Transport is provided at Attachment B. The all-day fee for parking in off-street car parks has been increased to $6 per day. This creates parity with the all-day fee for parking in on-street metered car parks of $6 per day.

transport-related updates

11 Staff have undertaken a preliminary review of existing parking data and parking capacity in the central city area. This includes the development of a mapping tool which quantifies the number of parking restrictions in an area as per the Traffic and Parking Bylaw.

12 Further parking-related studies and business cases are proceeding, including parking occupancy in the CBD, real time CBD parking data, business case for improved parking experience and parking management plan. These parking-related studies and investigations may be funded within existing project budgets (eg. George Street upgrade and travel demand management projects). These studies will inform the 10 year plan 2021-31, including any capital and operating budget requirements.

Levels of service

13 There are no changes proposed to the levels of service, performance measures and targets stated in the 10 year plan 2018-28 for the Transport group in the 2020/21 year.

Signatories

Authoriser:

Simon Drew - General Manager Infrastructure Services

Attachments

	Title	Page
⇩a	Roading and Footpaths - Draft 2020/21 Operating Budget	66
⇩b	Roading and Footpaths - Draft 2020/21 Fees and Charges Schedule	67

SUMMARY OF CONSIDERATIONS

Fit with purpose of Local Government

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	☒	☐	☐

The Annual Plan 2020/21 contributes to objectives across the strategic framework, as it describes the Council’s activities, which are aligned to community outcomes. It also provides a long term focus for decision making and coordination of the Council’s resources, as well as a basis for community accountability. The activities of the Roadings and Footpaths Group primarily contributes to the identified strategy above.

Māori Impact Statement

Sustainability

10 year plan /Annual Plan / Financial Strategy /Infrastructure Strategy

This report provides draft budgets for the Roading and Footpaths Group for inclusion in the Annual Plan 2020/21.

Financial considerations

The financial considerations are detailed in the report.

Significance

There will be full engagement on the 2020/21 draft budget as part of the Annual Plan process, which will cover any issues of significance.

Engagement – external

The content of the Annual Plan 2020/21 is of interest to the community and there will be a full community engagement process.

Engagement – internal

Staff and managers from across the Council have been involved in the development of the draft budgets.

Risks: Legal / Health and Safety etc.

There are no known risks.

Conflict of Interest

There are no known conflicts of interest.

Community Boards

Annual Plan Council

29 January 2020

Central City Bus Loop Update Report

Department: Transport

EXECUTIVE SUMMARY

1 This report provides Council with an update on the Central City Bus Loop trial work undertaken and planned collaboratively between the DCC and the Otago Regional Council (ORC) in 2019/20.

2 A joint DCC and ORC feasibility study has been initiated, however the study and preparation of trial options has been delayed, with initial outcomes expected in April 2020.

RECOMMENDATIONS

That the Council:

a) Notes the progress on the central city bus loop trial work.

BACKGROUND

3 At Annual Plan 2019/20 deliberations on 29 May 2019, Council resolved the following:

Moved (Cr Aaron Hawkins/Cr David Benson-Pope):

“That the Council:

a) Supports:
i) the trial of a free, low carbon central city bus loop service; and

ii) using DCC revenue to offset bus fares on the wider public transport network.

b) Includes $150,000 in the 2019/20 budget to progress both pieces of work, feeding in to the ORC review of its Regional Public Transport Plan.

c) Intends for the central city bus loop trial to run for at least a full twelve-month period.

d) Continues to engage with NZTA, ORC and EECA on alternative revenue streams to achieve these two objectives.

e) Acknowledges the planned review by government of subsidised bus fares for people with a Community Services card, and commits to engaging in that design process.

f) Brings options back no later than the Annual Plan 2020/21 to deliver on a) (i) to support the trial of a free, low carbon central city bus loop service.

g) Reports back on progress of the ORC RPTP review to the Annual Plan 2020/21, particularly as it relates to the delivery of a) (ii) to support using DCC revenue to offset bus fares on the wider public transport network.”

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, Kate Wilson and Mayor Dave Cull (10).

Against: Crs Mike Lord, Lee Vandervis and Andrew Whiley (3).

Abstained: Nil

The division was declared CARRIED by 10 votes to 3

Motion carried (AP/2019/010)

DISCUSSION

4 Since June 2019, DCC staff have been working closely with ORC on the initiation of a joint feasibility study for an inner-city bus loop trial which reflects Council’s resolution.

5 A joint DCC and ORC feasibility study has been initiated, however the commissioning of this study and preparation of options have been delayed. This is due to changes in key transport planning and operational staff at both ORC and DCC, and the need for further analysis of alignment between a bus loop trial and the review of the Otago Regional Public Transport Plan (RPTP).

6 As anticipated in Council’s May 2019 resolution, the trial raises objectives that will be considered in the RPTP review, in particular, changes to the fare structure, introducing bus priority measures and the investigation of low-carbon emission public transport vehicles.

Otago Regional Public Transport Plan (RPTP) and Shaping Future Dunedin Transport project

7 The Otago RPTP is a statutory planning document that describes the public transport service that ORC proposes for the region in the next ten years. It describes the public transport services that are integral to the region’s public transport network; the policies and procedures that apply to those services; and the information and infrastructure that support those services.

8 Legislation requires ORC to adopt the RPTP in order to tender for new or replacement services, and to apply for funding through the Regional Land Transport Plan (RLTP) and National Land Transport Plan (NLTP).

9 The current RPTP was issued in 2014. ORC intends to review its RPTP in 2020, which is to align with the New Zealand Transport Authority (NZTA) funding through the 2021/24 RLTP and NLTP. The RTLP and NLTP are being prepared in late 2020.

10 The Shaping Future Dunedin Transport project, which is led by central government, will also inform future investment proposals by NZTA, ORC and DCC. The project will engage with stakeholders, seek public opinion and consult on options in 2020. The project will include public transport proposals.

Joint Feasibility Study

11 Initial feasibility study outcomes are expected in April 2020, and will be brought back to Council as part of Annual Plan 2020/21 deliberations.

12 The joint feasibility study will include:

· the development of a route, service frequency and operating hours;

· cost estimates, patronage and fare scenarios;

· investigating how the service would operate within Dunedin’s transformational context over the next 10 years; and

· lessons learned from free bus loops in other similar cities.

13 Feasibility study costs are estimated to be $50k and ORC has committed to pay 50% of this (i.e. $25k each).

OPTIONS

14 Not applicable.

NEXT STEPS

15 Once the feasibility study is concluded, DCC expects the RPTP review process to be underway. An update on the feasibility study will be brought back to Council as part of the 2020/21 Annual Plan deliberations.

Signatories

Author:	Simone Handwerk - Senior Transport Planner
Authoriser:	Simon Drew - General Manager Infrastructure Services

Attachments

There are no attachments for this report.

SUMMARY OF CONSIDERATIONS

Fit with purpose of Local Government

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	☒	☐	☐

Māori Impact Statement

Sustainability

Sustainability is an underlying principle of the DCC’s strategic framework. An effective public transport network supports the DCC to embed the principles of sustainability.

LTP/Annual Plan / Financial Strategy /Infrastructure Strategy

This report provides an update on the development of the Annual Plan 2020/21 and implications for the 10 Year Plan.

Financial considerations

This report has no immediate financial impacts. A decision on the balance of the $150k Council funding for the feasibility study will be determined following the completion of the feasibility study results in April 2020.

Significance

There will be full engagement on the 2020/21 draft budget as part of the Annual Plan process, which will cover any issues of significance.

Engagement – external

In the development of the joint feasibility study, discussions have taken place between the ORC and DCC staff.

Engagement - internal

Transport Strategy, Corporate Policy.

Risks: Legal / Health and Safety etc.

There are no known risks.

Conflict of Interest

There are no known conflicts of interest.

Community Boards

Annual Plan Council

29 January 2020

Waste Management - 2020/21 Draft Budget

Department: Waste and Environmental Solutions

EXECUTIVE SUMMARY

1 This report provides an overview of the draft 2020/21 budget for the Waste Management Group and includes the Waste and Environmental Solutions activity.

RECOMMENDATIONS

That the Council:

a) Adopts for the purposes of developing the Annual Plan 2020/21 and engaging with the community:

i) The draft 2020/21 operating budget for the Waste Management Group as shown/amended at Attachment A.

ii) The draft 2020/21 fees and charges schedules for Waste and Environmental Solutions as shown/amended at Attachment B.

Operating budget

Revenue

External revenue

2 External revenue has decreased by $4.874 million, -33%. There has been a significant reduction in commercial tonnage to the Green Island Landfill (the landfill). This has assisted in extending the approximate remaining life of the landfill to 2025-26.

Expenditure

Operations and maintenance

3 Operations and maintenance costs have decreased by $1.673 million, -15%. Emissions Trading Scheme (ETS) costs and contract costs have reduced as a result of reduced tonnage to the landfill and a lower emissions factor due to an upgrade in the landfill gas collection system.

4 It should be noted the Government is consulting on proposals for New Zealand Emissions Trading Scheme (NZETS) settings, which will be set through regulations in mid-2020, with potential budget impacts in the 2020/21 year.

Consumables and general costs

5 Consumable and general costs have increased by $183k, 8%. The consultants and legal budgets have increased by $420k for work on Smooth Hill, waste futures projects and the landfill extension. Waste levy costs have decreased by $256k due to lower tonnage at the landfill.

Fees and charges

6 Fees and charges have been categorised as ‘inclusive’ or ‘exclusive’ of Emissions Trading Scheme (ETS) costs. The inclusive landfill charges include costs associated with ETS as these general waste loads contribute to landfill emissions. All waste to landfill attracts the Ministry for the Environment Waste Levy, which is currently set at $10 per tonne.

7 There have been some reductions in landfill charges at Green Island Landfill, and no increases for Middlemarch and Waikouaiti Landfills.

8 The installation of a second weighbridge at Green Island Landfill, to be installed mid-2020, has resulted in no changes to transfer station charges. The second weighbridge will result in a new charging regime whereby most charges are based on actual measured weight (to the nearest 50 kilograms (kg)), rather than by the current system that uses average volume by vehicle type.

9 Green Island’s 100% Vegetation Waste and Solid Waste fees have been matched to small vehicle charges and therefore reduced significantly. Changes to these charges reflect the move to 50kg weight increments, rather than 500kg increments, to match the charging regime described above.

10 A copy of the fees and charges schedules for Waste and Environmental Solutions is provided at Attachment B.

Levels of service

11 There are no changes proposed to the levels of service, performance measures and targets stated in the 10 year plan 2018-28 for the Waste Management Group in the 2020/21 year.

Signatories

Author:	Chris Henderson - Group Manager Waste and Environmental Solutions
Authoriser:	Simon Drew - General Manager Infrastructure Services

Attachments

	Title	Page
⇩a	Waste and Environmental Solutions - Draft 2020/21 Operating Budget	78
⇩b	Waste and Environmental Solutions - Draft 2020/21 Fees and Charges Schedule	79

SUMMARY OF CONSIDERATIONS

Fit with purpose of Local Government

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	☒	☐	☐

Māori Impact Statement

Sustainability

10 year plan /Annual Plan / Financial Strategy /Infrastructure Strategy

This report provides an update on the development of the Annual Plan 2020/21 and implications for the 10 Year Plan.

Financial considerations

The financial considerations are detailed in the report.

Significance

There will be full engagement on the 2020/21 draft budget as part of the Annual Plan process, which will cover any issues of significance.

Engagement – external

The content of the Annual Plan 2020/21 is of interest to the community and there will be a full community engagement process.

Engagement - internal

Staff and managers from across the Council have been involved in the development of the draft budgets.

Risks: Legal / Health and Safety etc.

There are no known risks.

Conflict of Interest

There are no known conflicts of interest.

Community Boards

Annual Plan Council

29 January 2020

Reserves and Recreational Facilities - 2020/21 Draft Budget

Department: Parks and Recreation

EXECUTIVE SUMMARY

1 This report provides an overview of the draft 2020/21 budgets for Reserves and Recreational Facilities Group and includes the following activities:

· Botanic Garden

· Cemeteries and Crematorium

· Aquatic Services

· Parks Operations

· Recreation Planning.

RECOMMENDATIONS

That the Council:

a) Approves for the purposes of developing the Annual Plan 2020/21 and engaging with the community:

i) The draft 2020/21 operating budget for the Reserves and Recreational Facilities Group as shown/amended at Attachment A.

ii) The draft 2020/21 fees and charges schedules for Parks Operations, Aquatic Services, Botanic Garden and Cemeteries and Crematorium as shown/amended at Attachment B.

Operating budget

Revenue

External revenue

2 External revenue has increased by $251k, 5%. Freedom camping revenue has increased, partly offset by a reduction in sport ground revenue. Cremations revenue is increased, offset partly by a decrease in interment revenue. Aquatic Services revenue is increased $98k due to a 3% increase in fees and charges.

Grants and subsidies operating revenue

3 New Zealand Transport Authority subsidy revenue decreased by $608k, -97% due to the vegetation contract transferring to Transport.

Expenditure

Personnel costs

4 Personnel costs have increased by $447k, 6%. Aquatic Services increased $245k due mainly to additional rostered hours at Moana Pool in response to legislative requirements around rest breaks, and increased Swim School demand.

Operations and maintenance

5 Operations and maintenance costs have decreased by $2.301 million, -14%. The vegetation contract ($1.050 million) and greenspace berm maintenance contract ($625k) have been transferred to Transport. Exeloos and reserves toilets maintenance ($185k) has been transferred to Property. The Edgar Centre service level agreement has been reduced $676k as Property are no longer invoicing the Trust for rent or recoveries. These reductions are partially offset by contract cost increases for the greenspace and horticultural contracts.

Occupancy costs

6 Occupancy costs have increased by $426k, 12%. This is due to increased costs for security $122k, rates and insurance $80k and contract cleaning $60k. Parks have also budgeted for the estimated $184k expenditure associated with Freedom Camping and Bylaw management (ranger patrols, security and vehicle costs), but have not budgeted for any potential revenue which can be received through a Ministry of Business, Innovation and Employment (MBIE) grant as this is subject to annual application.

Consumables and general costs

7 Consumable and general costs have increased by $165k, 12%. Consultants fees have increased $170k to reflect the Recreation Planning work plan of priority projects, including the Aquatics Strategy review, Recreations Needs analysis, Open Spaces review, Reserve Management plans, and Asset Management condition/valuation assessments.

Depreciation

8 Depreciation has increased by $631k, 15% due to asset revaluations and new assets as a result of the capital expenditure programme.

Fees and charges

9 Fees and charges for Reserves and Recreational Facilities have generally been increased by 3% (with some rounding), which includes swimming pool charges and cemetery and crematorium charges. New fees for Aquatic Services also include BBQ and lane hire fees (these are new services). A copy of the Reserves and Recreational Facilities Group fees schedule is provided at Attachment B.

Levels of service

10 There are no changes proposed to the levels of service, performance measures and targets stated in the 10 year plan 2018-28 for the Reserves and Recreational Facilities Group in the 2020/21 year.

Signatories

Author:	Robert West - Group Manager Parks and Recreation
Authoriser:	Sandy Graham - General Manager City Services

Attachments

	Title	Page
⇩a	Reserves and Recreational Facilities - Draft 2020-21 Operating Budget	88
⇩b	Reserves and Recreational Facilities - Draft 2020-21 Fees and Charges Schedule	89

SUMMARY OF CONSIDERATIONS

Fit with purpose of Local Government

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	☐	☐	☐

The Annual Plan 2020/21 contributes to objectives across the strategic framework, as it describes the Council’s activities, which are aligned to community outcomes. It also provides a long term focus for decision making and coordination of the Council’s resources, as well as a basis for community accountability. The activities of the Reserves and Recreational Facilities Group primarily contributes to the identified strategies above.

Māori Impact Statement

Sustainability

10 year plan /Annual Plan / Financial Strategy /Infrastructure Strategy

This report provides draft budgets for the Reserves and Recreational Facilities Group for inclusion in the Annual Plan 2020/21.

Financial considerations

The financial considerations are detailed in the report.

Significance

There will be full engagement on the 2020/21 draft budget as part of the Annual Plan process, which will cover any issues of significance.

Engagement – external

The content of the Annual Plan 2020/21 is of interest to the community and there will be a full community engagement process.

Engagement - internal

Staff and managers from across the Council have been involved in the development of the draft budgets.

Risks: Legal / Health and Safety etc.

There are no known risks.

Conflict of Interest

There are no known conflicts of interest.

Community Boards

Annual Plan Council

29 January 2020

Tracks, Levels of Provision Progress Report

Department: Parks and Recreation

EXECUTIVE SUMMARY

1 This report provides Council with an update on Track audit and Track levels of provision (LOP) work undertaken and planned by Parks and Recreation (PARS) staff in 2019/20.

RECOMMENDATIONS

That the Council:

a) Notes the progress and planned actions on the PARS Track audit and Track LOP Project for 2019/20.

b) Notes that the completed PARS Track audit and Track LOP Project will inform the PARS Tracks capital and operational budget for Council to consider as part of the 10 Year Plan deliberations.

BACKGROUND

2 Submissions to the Annual Plan 2019/20 indicated support for improving the level of investment in provision of tracks in Dunedin.

3 Council requested PARS staff to prepare a report for Council which outlined expenditure and resources needed to meet anticipated service levels as a result of a Track audit being undertaken by PARS staff.

4 At Annual Plan 2019/20 deliberations on 27 May 2019, Council resolved the following:

“Moved (Cr Rachel Elder/Cr Kate Wilson):

That the Council:

a) Notes the increase in spending on on-going maintenance and audit processes.

b) Notes budgets will be prepared for the 2020/21 Annual Plan after the audit process is complete.

Motion carried (AP/2019/001)”

DISCUSSION

5 DCC manages a network of tracks across Dunedin, and an implementation action in the Parks and Recreation Strategy 2017-2027 is to “Undertake an audit of existing parks, open spaces and tracks and map the results to establish an understanding of the level of provision and the quality of Dunedin’s parks, open spaces and tracks”

6 PARS track operational maintenance budget for 2019/20 is $365k (an increase of 55% on the 2018/19 year), and $50k is included in new capital in each year of the current 10 Year Plan.

7 To inform future investment for the provision of tracks in Dunedin two projects are currently underway -

a) Track audit – To understand the level of services, PARS embarked on a comprehensive audit of Dunedin’s track network in December 2017. It was expected that this audit would be completed in time for the Annual Plan 2020/21 deliberation process. However, the audit is not complete due to the number of tracks identified and the resource required to complete the audit. The audit will inform the development of PARS track asset management and support strategic planning to guide future investment decisions relating to the track network.

b) Track - Levels of Provision (LOP) project – To provide a strategic plan for track development for the city. The project team comprises DCC staff and community representatives and groups with an interest/expertise in tracks. The scope of this project includes sealed and unsealed walking tracks on sections of land managed by DCC or Department of Conservation (DOC). This includes paper roads where they form part of an existing track or can provide future opportunities to link existing tracks; it does not include urban footpaths. The scope of this work also includes cycle tracks on land owned and managed by DCC excluding on-road cycle lanes, BMX and pump tracks.

8 These projects will be completed during the 2019/20 financial year and inform future investment decisions for consideration by Council as part of the next 10 Year Plan.

Track audit

9 The Track LOP project group has adopted the NZ HB8630.2004 Track Standard for all DCC tracks, and this is now being applied to the track audit data collection. The standard is consistent with DOC, and by adopting this DCC can be assured that there is Dunedin wide consistency for the design, construction, and maintenance of tracks, and outdoor structures across DCC and DOC in the future.

10 PARS have recruited a full-time temporary summer track intern (the same person who worked in this role in 2017/18) to complete the audit of 250 DCC tracks by early March 2020. Audit of the most popular 70 high priority tracks (classified as - Day Visitor and Short Stop Traveller) is complete, and work on medium (Urban Resident), and low priority (Backcountry Adventure) tracks will be completed by early March 2020.

11 Audit data is being collected in a format that will allow automatic upload in PARS Asset Management System IPS, and so the data collected will be able to be used to inform the Track LOP project, and operational investment decisions by mid-2020.

Track LOP

12 A project governance framework and project plan has been established for the Track LOP project. The Track LOP project involves both internal and external stakeholders including representatives from Halberg Disability, MountainBike Otago, and DOC.

13 A review of the DCC walking tracks data is progressing well. The aim of this piece of work is to identify gaps in knowledge and information and to determine a consistent structure and format for collecting and storing future track asset information.

14 A user track profiling exercise is complete. The aim of this work was to determine who is using the tracks. This identified (as per the NZ HB8630.2004 Track Standards handbook) the current predominant track user and vulnerable user for all DOC and DCC tracks. These findings will lead to decisions on the service level required for that user, and ultimately, funding requirements associated with these decisions.

15 Demand analysis work is also underway. This analysis is looking at national and international tourism projections and activity trends for Dunedin. In addition, local population projections and activity trends will be analysed. This analysis will help to determine the anticipated future demand for these services and the level of provision required to meet this anticipated future demand.

16 Work has also commenced on standardising track signage, including hazard warning signage on walking tracks. This work was piloted for Second Beach Walking Track. It involved a workshop with DOC to identify the vulnerable user common hazards and associated mitigation strategy. The new signage was installed at Second Beach in December 2019.

17 The project team has also started reviewing current information on cycle tracks and cycle track classifications.

18 Examples of the work being undertaken are attached for Councillors information.

OPTIONS

19 Not applicable.

NEXT STEPS

20 Parks staff will complete the track audit and upload data into the asset management system by early March 2020 and complete the Track Level of Service work in time for informing track maintenance and development investment decisions for inclusion in the next 10 Year Plan process.

21 Parks staff will also present a progress report and presentation to the Community and Culture Committee at its April meeting.

Signatories

Author:

Claire Swift - Senior Planner

Authoriser:

Robert West - Group Manager Parks and Recreation

Sandy Graham - General Manager City Services

Attachments

	Title	Page
⇩a	Track Maintenance Summary	104
⇩b	User Type Description	105
⇩c	Case Study - Ross Creek	106

SUMMARY OF CONSIDERATIONS

Fit with purpose of Local Government

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	☒	☐	☐

The Annual Plan 2020/21 contributes to objectives across the strategic framework, as it describes the Council’s activities, which are aligned to community outcomes. It also provides a long term focus for decision making and coordination of the Council’s resources, as well as a basis for community accountability. The activities of the Parks and Recreation group meet strategic objectives across the framework, but primarily contribute to the identified strategy identified above.

Māori Impact Statement

The project team will be engaging with Aukaha, as we believe there will be significant mana whenua interest in this project.

Sustainability

Not known at this stage, and sustainability is being considered as part of the project plan.

LTP/Annual Plan / Financial Strategy /Infrastructure Strategy

The outputs from the Tracks LOP Project will inform the development of the next 10 Year Plan.

Financial considerations

None at this time. Financial considerations will be incorporated into 10 Year Plan process.

Significance

There will be full consultation on the 2020/21 Annual Plan, which will cover any issues of significance

Engagement – external

External stakeholders form part of the Track LOP project group. Further external engagement will be required as the project progresses.

Engagement - internal

Internal stakeholders form part of the Track LOP project group. Further internal engagement will be undertaken as the project progresses.

Risks: Legal / Health and Safety etc.

There are no identified risks.

Conflict of Interest

There are no known conflicts of interest.

Community Boards

A Community Board Chairperson is part of the Track LOP project group. Further community board engagement will be undertaken as the project progresses.

Annual Plan Council

29 January 2020

Property Services - 2020/21 Draft Budget

Department: Property

EXECUTIVE SUMMARY

1 This report provides an overview of the draft 2020/21 budgets for the Property Services Group, and includes the following activities:

· Community Housing

· Investment Property

· Commercial Property

· Community Property

· Operational Property.

RECOMMENDATIONS

That the Council:

a) Approves for the purposes of developing the Annual Plan 2020/21 and engaging with the community:

i) The draft 2020/21 operating budget for the Property Services Group as shown/amended at Attachment A.

ii) The draft 2020/21 fees and charges schedules for Community Housing and Community Property as shown/amended at Attachment B.

Operating budget

Revenue

External revenue

2 External revenue has decreased by $191k, -1%. Removal of revenue from the Edgar Centre lease is offset by removal of expenditure from the Reserves and Recreational Facilities Group budget (which provided funding towards the Edgar Centre lease), making the change cost neutral to DCC. The lost revenue for Property Services is partially offset by new revenue from recently purchased properties at 278 King Edward Street and 1 White Street, and increased revenue from a number of properties following completed rent reviews.

Expenditure

Occupancy costs

3 Occupancy costs have increased by $806k, 11%. Contract cleaning costs have increased partly due to an allowance for living wage increases for contract cleaners as well as additional costs determined from work schedules. Cleaning costs relating to exeloos and reserves toilets have also been transferred from the Reserves and Recreational Facilities Group. Rates costs have also increased.

Consumables and general costs

4 Consumable and general costs have decreased by $137k, -12% due to a reduction in the consultant budget.

Depreciation

5 Depreciation has increased by $786k, 8% due to asset revaluations and new assets as a result of the capital expenditure programme.

Interest

6 Interest has decreased by $500k, -15% due to lower interest rates.

Fees and charges

7 Fees and charges have generally been increased by 2% for the Community Art Gallery, 3% for Housing and 2.5% for Road reserve encroachments (with some rounding) (Attachment B).

Levels of service

8 There are no changes proposed to the levels of service, performance measures and targets stated in the 10 year plan 2018-28 for the Property Services Group in the 2020/21 year.

Signatories

Author:	Rory Hibbs - Property Manager
Authoriser:	Sandy Graham - General Manager City Services

Attachments

	Title	Page
⇩a	Property - Draft 2020-21 Operating Budget	111
⇩b	Property - Draft 2020-21 Fees and Charges Schedule	112

SUMMARY OF CONSIDERATIONS

Fit with purpose of Local Government

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	☐	☐	☐

The Annual Plan 2020/21 contributes to objectives across the strategic framework, as it describes the Council’s activities, which are aligned to community outcomes. It also provides a long term focus for decision making and coordination of the Council’s resources, as well as a basis for community accountability. The activities of the Property Group primarily contribute to the identified strategies above.

Māori Impact Statement

Sustainability

10 year plan /Annual Plan / Financial Strategy /Infrastructure Strategy

This report provides draft budgets for the Property Services Group for inclusion in the Annual Plan 2020/21.

Financial considerations

The financial considerations are detailed in the report.

Significance

There will be full engagement on the 2020/21 draft budget as part of the Annual Plan process, which will cover any issues of significance.

Engagement – external

The content of the Annual Plan 2020/21 is of interest to the community and there will be a full community engagement process.

Engagement - internal

Staff and managers from across the Council have been involved in the development of the draft budgets.

Risks: Legal / Health and Safety etc.

There are no known risks.

Conflict of Interest

There are no known conflicts of interest.

Community Boards

Annual Plan Council

29 January 2020

Community Housing - Funding

Department: Property

EXECUTIVE SUMMARY

1 The purpose of this report is to provide an update on funding of Dunedin City Council’s Community Housing portfolio (“the portfolio”) and on the review of the Dunedin Housing Policy 1997.

2 This review is in response to a request at the previous Annual Plan, when it was reported that the portfolio was running at a deficit. The draft 2020/21 budget forecasts a deficit of $600k.

RECOMMENDATIONS

That the Council:

a) Notes that the Community Housing portfolio is forecast to return a deficit of $600k in the draft 2020/21 budget.

b) Notes that staff will carry out a full review of both the Dunedin Housing Policy 1997, and the Social Housing Strategy 2010-2020 as part of the 10-year Plan process.

BACKGROUND

3 During the Annual Plan meetings in January 2019, councillors were advised that the portfolio was running at a deficit, and that proposed rent increases for the following year would not enable a return to break-even and that staff would review the funding policy for Housing in time for the 2020/21 budget process. This report provides an update on the work that has been done towards reviewing the policy.

History of the portfolio

4 Dunedin City Council’s forerunner, the Dunedin City Corporation, first got involved in social housing in 1946 in response to an ‘acute housing shortage’ at the time. They initially provided transitional housing for returned servicemen and their families, before focusing on providing housing units for elderly people on low income.

5 Over the last 70 years, Dunedin City Council’s Community Housing portfolio has become the city’s second largest housing provider. The portfolio now consists of 937 units, primarily leased to persons over 55 years of age.

6 The portfolio was intended to operate on a break-even basis; effectively providing accommodation to older persons, particularly those with limited financial means, at no direct cost to ratepayers.

7 The management of the portfolio is governed by two main documents, the Dunedin Housing Policy (“the policy”) written in 1997 and included as Attachment A, and the Social Housing Strategy 2010 – 2020 (“the Strategy”) written in 2009 and included as Attachment B.

8 The policy is more generally concerned with the operation of the portfolio, and includes the policy of charging break-even rent. The strategy is more generally concerned with housing across the city, and includes the strategy of growing the portfolio by building new units.

9 Both documents are dated, and a full review of both the Dunedin Housing Policy 1997, and the Social Housing Strategy 2010-2020 is recommended as part of the Long Term Plan process.

DISCUSSION

Break-even

10 The policy defines break-even rent as:

“Break-event rent will be set at a level which ensures that income over all housing, is approximately equal to expenditure over all housing, where expenditure includes all amounts accumulated for redevelopment and renewal. The redevelopment and renewal fund will ensure the sustainability of Dunedin City Council Housing and its ability to evolve to meet the changing needs of the community. This is the method for setting existing rents.”

11 Council operated an ‘Elderly Persons Housing Renewal Fund Reserve’ (“the fund”) until 2011, when the fund was wound down. This fund was a reserve account, funded by crediting the book value of housing depreciation to the fund. Although no depreciation contributions or capital expenditure has been accounted for against the fund since 2011, as at 30 November 2019 the balance of the fund was $2.07m.

12 It is good asset management practice to fund capital renewals and refurbishments from depreciation. The fund formalised this practice, however capital expenditure has been variable as shown in the graph below.

13 From 2003 - 2018, the portfolio has been depreciated by a total of $24.6m, the total amount spent on redevelopment and renewals in that period is $17.5m.

14 Total operating expenditure across the portfolio is $7.1m in the draft 2020/21 budget. This total expenditure figure is broken down into various budget lines as shown in the table below;

Budget line	Amount
Internal costs	$0.6m
Ops & Maintenance	$2.7m
Occupancy Costs	$1.8m
Depreciation	$2.0m
TOTAL EXPENDITURE	$7.1m

15 Internal Costs relate primarily to personnel costs but also include the internal redistribution of the cost of council operations, such as Finance, Human Resources, IT Services, Customer Services.

16 Occupancy Costs include costs such as rates, insurance and site energy consumption (for example communal laundry facilities).

17 Operations & Maintenance includes all interior, exterior and grounds maintenance.

18 Total expenditure also includes depreciation, budgeted at $2m in the draft 2020/21 budget. Depreciation is re-assessed every three years when the portfolio is re-valued, and the recent city wide revaluations are likely to lead to increased depreciation in future years.

19 Costs due to complying with changing legislation, maintaining aging assets, and general costs of material and labour, have increased faster than rental revenue.

Rents

20 Total rental revenue across the portfolio is $6.5m in the draft 2020/21 budget, against total operating expenditure of $7.1m, resulting in a deficit of $600k. A deficit of $320k is forecast for the 2019/20 financial year.

21 The graph below shows how rental revenue and operating expenditure has varied over the last 15 years.

22 The graph above shows:

i. Six out of the fifteen years have achieved break-even, nine years have not.

ii. A steady increase in total revenue due to improved occupancy and in later years, growth in rental rates.

iii. 2010/11 - A Housing Improvement programme invested in capital improvement to the units. As a result, reactive maintenance spend reduced in subsequent years.

iv. 2015/16 – 2017/18 - A rise in expenditure due to increases in Depreciation, Internal Costs and Operations & Maintenance to meet legislative requirements.

23 Rent increases have not been consistently applied and are not relative to the cost of operating the portfolio.

24 A table showing rental increases that have been applied from 2003 is shown below;

	Increase from previous year		Increase from previous year
2003	$4 - $6	2012	$3 - $6
2004	$4 - $10	2013	No Increase
2005	$2	2014	No Increase
2006	$2	2015	No Increase
2007	$10	2016	No Increase
2008	$12 - $23	2017	No Increase
2009	No Increase	2018	$9
2010	$8 - $15	2019	$1.30 - $2.60
2011	$9 - $12	2020	$3 - $6 (proposed)

25 Rental increases in the 2019/20 year were within 2%, in line with the fees & charges guidelines, and included some rounding.

26 Proposed rental increases in the 2020/21 Annual Plan are less than 3%, in line with the fees & charges guidelines, including some rounding, and will be $3 for the majority of tenants.

27 Rents have been kept low to remain ‘affordable’, but there has been no analysis to support what ‘affordable’ means, and what rental level would be affordable for our tenants. There has been a general desire to limit rent increases for our tenants.

28 Affordable rent is generally based on rent being set at 30% of the average tenant’s income. This is the global standard for affordable housing, and the Housing Affordability Measure (HAM) used by the Ministry of Housing and Urban Development.

29 Currently, the various types of single bed units are charged an average of $119 per week. Analysis of a typical tenant shows they could receive $411 superannuation plus $12 accommodation supplement per week. Therefore, rent of $119 per week equates to approximately 28% of a tenant’s income.

30 An ‘affordable rent’ based on 30% of a typical superannuation income would be $130 per week, as at 2019.

31 According to Tenancy Services, median market rents for a 1 bedroom unit for the period May-October 2019 range from $210 - $345, with the lower quartile ranging from $145 - $317 across the various suburbs of Dunedin.

32 The majority of increases have been applied consistently to all units, however individual circumstances have been taken into account, leading to a wide variety of actual rents being applied.

33 There are further variations in rent amounts dependent on the unit’s age, location and level of refurbishment.

34 There are over 30 different rental amounts being charged across the portfolio, as shown in the table below.

Type of Unit Description	Total Units	Actual rent charged	Publicised rent
Single Bedsit	59	$115 - $126	$115
Single partition	325	$117	$117
Single separate	350	$105 - $131	$121
Double partition	61	$106 - $160	$160
Double separate	51	$158 - $165	$165
1 Double Bedroom	15	$174	$174
2 Bedroom	30	$180 - $202	$202

Social Housing Strategy 2010-2020

35 The Social Housing Strategy 2010-20 (the strategy) has two key principles:

i) The Council’s role as a lead provider of social housing in Dunedin, particularly housing for older persons.

ii) That the Council will maintain the current breakeven approach for setting rents for Council housing tenants who meet the income and asset thresholds.

36 The strategy further outlines four objectives:

i) To improve the quality of social housing accommodation in Dunedin, including the Dunedin City Council’s own community housing.

ii) To increase access to social housing options for all residents requiring assistance.

iii) To ensure that there are adequate levels of support that address housing needs.

iv) To ensure there is adequate emergency housing provision.

37 To achieve those objectives, the strategy outlined an Implementation Plan of focusing on refurbishing existing units for the first five years, 2010-2015, before focusing on growing the portfolio by 5-7 new units per year for the period 2015-2020, up to a total cap of 1,000 units.

38 While the strategy has the principle that the Dunedin City Council is a lead provider of social housing in Dunedin, particularly housing for older persons, and has the objective to increase access to social housing, no new units have been added to the portfolio since 2010.

39 More recently, the Mayor’s Taskforce for Housing Plan for Dunedin (2019 – 2039) recommended that the Council should invest in a new supply of affordable homes as a partner as well as a direct supplier and, among other things, prioritise the accessibility of housing to those most in need.

OPTIONS

40 As an update report only, there are no options associated with this report.

NEXT STEPS

41 Work is now underway to review both the Dunedin Housing Policy 1997 and the strategy. This review will form part of the 10 year plan process and staff will bring a report to Council to consider options.

42 Staff will also bring a further report to Council to consider whether or not Council wishes to grow the portfolio or to maintain it at its current level. Again, this will form part of the 10 year plan process.

Signatories

Author:	Anna Nilsen - Planning and Support Manager
Authoriser:	Sandy Graham - General Manager City Services

Attachments

	Title	Page
⇩a	Dunedin Housing Policy 1997	124
⇩b	Social Housing Strategy 2010-2020	133
⇩c	Community Housing Information for Applicants	157

SUMMARY OF CONSIDERATIONS

Fit with purpose of Local Government

This decision enables democratic local decision making and action by, and on behalf of communities.

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

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

This decision promotes the cultural 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	☒	☐	☐

Relevant for the Social Housing Strategy 2010-2020.

Ensuring there is adequate affordable healthy housing which meets the needs of all residents means the city can sustain resident’s quality of life, economically, socially and from a health perspective.

Māori Impact Statement

Mana Whenua had a representative on the Mayor’s Taskforce for Housing to keep all parties informed. Māori and Pasifika peoples are identified as being over represented within the group needing social housing.

Sustainability

LTP/Annual Plan / Financial Strategy /Infrastructure Strategy

The review of the Housing Policy and the Strategy will inform the next 10 year plan.

Financial considerations

Funding considerations are discussed in the report.

Significance

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

Engagement – external

Engagement with external social housing providers has occurred in the development of this report.

Engagement - internal

Engagement with Finance and Community Development.

Risks: Legal / Health and Safety etc.

There are no identified risks.

Conflict of Interest

There are no known conflicts of interest.

Community Boards

There are a number of social housing units in Community Board areas, so this issue is likely to be of interest to a number of Community Boards.

Annual Plan Council

29 January 2020

Libraries and Museums - 2020/21 Draft Budget

Department: Ara Toi

EXECUTIVE SUMMARY

1 This report provides an overview of the draft 2020/21 budgets for the Libraries and Museums Group, and includes the following activities:

· Ara Toi

· Dunedin Public Art Gallery (DPAG)

· Dunedin Public Libraries (Libraries)

· Olveston

· Otago Museum levy

· Toitū Otago Settlers Museum (Toitū), including the Lan Yuan.

RECOMMENDATIONS

That the Council:

a) Approves for the purposes of developing the Annual Plan 2020/21 and engaging with the community:

i) The draft 2020/21 operating budget for the Libraries and Museums Group as shown/amended at Attachment A.

ii) The draft 2020/21 fees and charges schedules for the Libraries and Museums Group as shown/amended at Attachment B.

Operating budget

Expenditure

Personnel costs

2 Personnel costs have increased by $250k, 2%, reflecting the general salary increase.

Occupancy costs

3 Occupancy costs have decreased by $149k, -10%, reflecting a reduction in insurance costs.

Grants and subsidies

4 Grants and subsidies have increased by $213k, 5%, reflecting an increase in the Otago Museum Levy. The 2019-20 budgeted DCC contribution of $4,239,613 to the Otago Museum levy is increased by 5% to $4,451,594. The Otago Museum budget continues the grant of $75k towards the Museum's Tangata Whenua Gallery redevelopment and the rates relief budget of $8k.

Depreciation

5 Depreciation has decreased by $153k, -10%, due to some assets at Toitū being fully depreciated.

Fees and charges

6 Some fees and charges for Libraries have increased but largely remain the same. The debt recovery charge ($15) has been removed due to collection agencies levying their own charges, while room hire charges for the City Library’s Dunningham Suite have increased to reflect more commercially competitive rates.

7 Fees for Olveston have generally increased, which is due to the increase in rates for tour guides, aligning their terms and conditions with DCC staff.

8 Fees for Lan Yuan have increased to reflect a more appropriate commercial rate.

9 Archive fees for Toitū have increased by more than 3%, however, the total dollar amounts for these fees are considered relatively minor and reflect a more commercially appropriate fee.

10 A copy of the fees and charges schedules for the Libraries and Museums Group is provided at Attachment B.

Levels of service

11 There are no changes proposed to the levels of service, performance measures and targets stated in the 10 year plan 2018-28 for the Libraries and Museums Group in the 2020/21 year.

Signatories

Author:	Nick Dixon - Group Manager Ara Toi
Authoriser:	Simon Pickford - General Manager Community Services

Attachments

	Title	Page
⇩a	Libraries and Museums - Draft 2020/21 Operating Budget	178
⇩b	Libraries and Museums - Draft 2020-21 Fees and Charges Schedule	179

SUMMARY OF CONSIDERATIONS

Fit with purpose of Local Government

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	☒	☐	☐

Māori Impact Statement

Sustainability

10 year plan /Annual Plan / Financial Strategy /Infrastructure Strategy

This report provides an update on the development of the Annual Plan 2020/21 and implications for the 10 Year Plan.

Financial considerations

The financial considerations are detailed in the report.

Significance

There will be full engagement on the 2020/21 draft budget as part of the Annual Plan process, which will cover any issues of significance.

Engagement – external

The content of the Annual Plan 2020/21 is of interest to the community and there will be a full community engagement process.

Engagement - internal

Staff and managers from across the Council have been involved in the development of the draft budgets.

Risks: Legal / Health and Safety etc.

There are no known risks.

Conflict of Interest

There are no known conflicts of interest.

Community Boards

Community Boards have an opportunity to present any issues of concern with the 2020/21 Annual Plan development. Staff are working with community boards to develop robust Community Board Plans to inform community board areas of activity.

Annual Plan Council

29 January 2020

Regulatory Services - 2020/21 Draft Budget

Department: Customer and Regulatory Services

EXECUTIVE SUMMARY

1 This report provides an overview of the draft 2020/21 budgets for the Regulatory Services Group, and includes the following activities:

· Building Services

· Compliance Solutions (includes Alcohol Licensing, Animal Services and Environmental Health)

· Parking Operations

· Parking Services (enforcement).

RECOMMENDATIONS

That the Council:

a) Approves for the purposes of developing the Annual Plan 2020/21 and engaging with the community:

i) The draft 2020/21 operating budget for the Regulatory Services Group as shown/amended at Attachment A.

ii) The draft 2020/21 fees and charges schedules for Alcohol Licensing, Animal Services, Building Services, Environmental Health, Parking Operations and Parking Services as shown/amended at Attachment B.

Operating budget

Revenue

External revenue

2 External revenue has increased by $529k, 3%. The main variance of $567k is due to an anticipated increase in the volume of Building Services fees for building consents processing, building inspections and code of compliance certificates.

Expenditure

Personnel costs

3 Personnel costs have increased by $598k, 7%. This incorporates a general salary increase and an increase in full time equivalent staff in Building Services to process the increased volume of consents. This increase is funded by additional Building Services fees revenue.

Consumables & General costs

4 Consumable and general costs have increased by $128k, 9% due to an increase in the number of Parking Warrant of Fitness and licence infringements issued, of which 50% is payable to the New Zealand Police, and an increase in the cost of Animal Services court lodgement fees and data communications costs.

Fees and charges

5 Animal Services fees (including dog registration) have not been changed. There has been a 40% cost reduction ($2.50 to $1.50 per bundle of 15 bags) for purchase of extra poo bags over the standard entitlement of 6 bundles per year.

6 Some Environmental Health fees for Business Activity, Verification, Food Premises and One-off Food Stall Inspections have generally increased by 3%.

7 Some Building fees have generally increased by 3%, with a new fee on Code of Compliance Certificates for older consents, which is to mitigate potential property claims for older consents that have no Code of Compliance Certificate issued.

8 Parking Services (Enforcement) fees and charges have generally remained unchanged, with two new permit fees for Special Circumstances and Tour Operators proposed (both $35). A copy of the Regulatory Group fees schedule is provided at Attachment B.

Levels of service

9 There are no changes proposed to the levels of service, performance measures and targets stated in the 10 year plan 2018-28 for the Regulatory Services Group in the 2020/21 year.

Signatories

Author:	Adrian Blair - Group Manager Customer and Regulatory Services
Authoriser:	Simon Pickford - General Manager Community Services

Attachments

Title

Page

⇩a

Regulatory Services Group - Draft 2020-21 Operating Budget

190

⇩b

Regulatory Services Group - Proposed 2020/21 Fees and Charges Schedule

191

SUMMARY OF CONSIDERATIONS

Fit with purpose of Local Government

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	☒	☐	☐

Māori Impact Statement

Sustainability

10 year plan /Annual Plan / Financial Strategy /Infrastructure Strategy

This report provides an update on the development of the Annual Plan 2020/21 and implications for the 10 Year Plan.

Financial considerations

The financial considerations are detailed in the report.

Significance

There will be full engagement on the 2020/21 draft budget as part of the Annual Plan process, which will cover any issues of significance.

Engagement – external

The content of the Annual Plan 2020/21 is of interest to the community and there will be a full community engagement process.

Engagement - internal

Staff and managers from across the Council have been involved in the development of the draft budgets.

Risks: Legal / Health and Safety etc.

There are no known risks.

Conflict of Interest

There are no known conflicts of interest.

Community Boards

Annual Plan Council

29 January 2020

Community and Planning - 2020/21 Draft Budget

Department: Community and Planning

EXECUTIVE SUMMARY

1 This report provides an overview of the draft 2020/21 budgets for the Community and Planning Group, and includes the following activities:

· City Development

· Community Development and Events

· Resource Consents.

RECOMMENDATIONS

That the Council:

a) Approves for the purposes of developing the Annual Plan 2020/21 and engaging with the community:

i) The draft 2020/21 operating budget for the Community and Planning Group as shown/amended at Attachment A.

ii) The draft 2020/21 fees and charges schedules for Resource Consents as shown/amended at Attachment B.

Operating budget

Revenue

External revenue

2 External revenue has increased by $19k, 1%. Resource consent revenue is anticipated to increase by $161k. This is offset by a reduction in Masters Games revenue as Masters Games is only held every two years.

Grants and subsidies revenue

3 Grants and subsidies revenue has decreased by $106k, -43%. Creative NZ funding was only applicable for 2018/19 and 2019/20; this is offset by a corresponding reduction in expenses.

Expenditure

Personnel costs

4 Personnel costs have increased by $577k, 11%. This incorporates a general salary increase and an increase of 5.3 full-time equivalent staff (FTE) across the group. This is a net increase after a reduction in FTE relating to the biennial staffing for the Masters Games.

5 Additional resources are provided in City Development for the second generation district plan and urban development work. An increase in Resource Consents FTE relates to the higher volume of consents, funded by additional fees revenue. Additional FTE for Housing Action Plan work is funded by a reduction in operations and maintenance costs. Community Development and Events have increased resource for events and a community and engagement specialist for South Dunedin and the coastal areas.

Operations and maintenance

6 Operations and maintenance costs have decreased by $204k, -14%. This decrease is due to pedestrianisation trials having been completed, and a transfer of Housing Action Plan project costs to personnel, to fund FTE for Housing Action Plan work.

Fees and charges

7 Fees and charges for Resource Consents have generally been increased by 3% (with some rounding), unless set by statute. There has been a 16% increase in the Limited Notified Subdivision Consents (deposit) fee from $5,000 to $5,800 (to reflect the median cost of applications). A copy of the Community and Planning Group fees schedule is provided at Attachment B.

Levels of service

8 There are no changes proposed to the levels of service, performance measures and targets stated in the 10 year plan 2018-28 for the Community and Planning Group in the 2020/21 year.

Signatories

Author:	Nicola Pinfold - Group Manager Community and Planning
Authoriser:	Sandy Graham - General Manager City Services

Attachments

	Title	Page
⇩a	Community and Planning - Draft 2020/21 Operating Budget	213
⇩b	Community and Planning - Draft 2020/21 Fees and Charges Schedule	214

SUMMARY OF CONSIDERATIONS

Fit with purpose of Local Government

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	☒	☐	☐

Māori Impact Statement

Sustainability

10 year plan /Annual Plan / Financial Strategy /Infrastructure Strategy

This report provides an update on the development of the Annual Plan 2020/21 and implications for the 10 Year Plan.

Financial considerations

The financial considerations are detailed in the report.

Significance

There will be full engagement on the 2020/21 draft budget as part of the Annual Plan process, which will cover any issues of significance.

Engagement – external

The content of the Annual Plan 2020/21 is of interest to the community and there will be a full community engagement process.

Engagement – internal

Staff and managers from across the Council have been involved in the development of the draft budgets.

Risks: Legal / Health and Safety etc.

There are no known risks.

Conflict of Interest

There are no known conflicts of interest.

Community Boards

Annual Plan Council

29 January 2020

Economic Development - 2020/21 Draft Budget

Department: Enterprise Dunedin

EXECUTIVE SUMMARY

1 This report provides an overview of the draft 2020/21 budgets for the Economic Development Group, and includes the following activities:

· Economic Development

· Destination Dunedin

· Dunedin i-site Visitor Centre (Visitor Centre).

RECOMMENDATIONS

That the Council:

a) Approves for the purposes of developing the Annual Plan 2020/21 and engaging with the community:

i) The draft 2020/21 operating budget for the Economic Development Group as shown/amended at Attachment A.

ii) The draft 2020/21 fees and charges schedules for the Economic Development Group as shown/amended at Attachment B.

Operating budget

Revenue

External revenue

2 External revenue has decreased by $330k, 29%. This is a result of the transfer of the delivery of the Otago Regional Business Partnership to another provider, and reduced partner funding for Study Dunedin. This reduction in income is offset by a reduction in associated expenses. There is an increase in external revenue from the Provisional Growth Fund of $100k for Otago regional economic development.

Expenditure

Operations and maintenance

3 Operations and maintenance costs have decreased by $392k, 21%. The main decreases relate to the reduction in Study Dunedin funding and transfer of the Otago Regional Business Partnership.

Fees and charges

4 Fees and charges for Economic Development (film permit) have not been changed.

5 A copy of the fees and charges schedules for Economic Development Group is provided at Attachment B.

Levels of service

6 There are no changes proposed to the levels of service, performance measures and targets stated in the 10 year plan 2018-28 for the Economic Development Group in the 2020/21 year.

Signatories

Author:	John Christie - Director Enterprise Dunedin
Authoriser:	Sue Bidrose - Chief Executive Officer

Attachments

	Title	Page
⇩a	Economic Development - Draft 2020-21 Operating Budget	225
⇩b	Economic Development - Draft 2020-21 Fees and Charges Schedule	226

SUMMARY OF CONSIDERATIONS

Fit with purpose of Local Government

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	☒	☐	☐

Māori Impact Statement

Sustainability

10 year plan /Annual Plan / Financial Strategy /Infrastructure Strategy

This report provides an update on the development of the Annual Plan 2020/21 and implications for the 10 Year Plan.

Financial considerations

The financial considerations are detailed in the report.

Significance

There will be full engagement on the 2020/21 draft budget as part of the Annual Plan process, which will cover any issues of significance.

Engagement – external

The content of the Annual Plan 2020/21 is of interest to the community and there will be a full community engagement process.

Engagement – internal

Staff and managers from across the Council have been involved in the development of the draft budgets.

Risks: Legal / Health and Safety etc.

There are no known risks.

Conflict of Interest

There are no known conflicts of interest.

Community Boards

Annual Plan Council

29 January 2020

Governance and Support Services - 2020/21 Draft Budget

Department: Finance

EXECUTIVE SUMMARY

1 This report provides an overview of the draft 2020/21 budgets for the Governance and Support Services Group and includes the following activities:

· Business information Services (BIS)

· Civic and Administration

· Corporate Leadership

· Corporate Policy

· Council Communications and Marketing (CCM)

· Customer Solutions

· Civil Defence

· Finance

· Finance and Commercial

· Fleet Operations

· People, Safety and Culture

· Investment Account

· Waipori Fund.

RECOMMENDATIONS

That the Council:

a) Approves for the purposes of developing the Annual Plan 2020/21 and engaging with the community:

i) The draft 2020/21 operating budget for the Governance and Support Services Group as shown/amended at Attachment A.

ii) The draft 2020/21 fees and charges schedules for the Governance and Support Services Group as shown/amended at Attachment B.

Operating budget

Revenue

External revenue

2 External revenue has decreased by $145k, -1%. This reflects the removal of triennial election related recoveries of $200k – see associated expense reductions below.

3 Contributions revenue has increased by $500k, 20%. This increase reflects the value of infrastructure assets vested to Council in relation to new sub-divisions.

4 The tax refund budget has been increased by $300k to better reflect the expected level of refund to be claimed.

Expenditure

Personnel costs

5 Personnel costs for the Governance and Support Services Group have increased by $1.460 million, 10%. This incorporates a general salary increase, an increase in full time equivalent (FTE) staff of 3.8 and the removal of the vacancy allowance budget. A breakdown is provided in the table below.

Personnel Costs	Budget 2019-20 $000	Draft Budget 2020-21 $000	Budget Inc (Dec) $000
Governance Support budget	15,432	16,362	930
Vacancy allowance	(530)	-	530
Total personnel costs	14,902	16,362	1,460

6 The changes in FTE include 2.0 FTE for organisational support (HR and Communications) and 1.5 FTE for strategic advice in the mayoral office.

7 The vacancy allowance budget was originally intended to reflect council-wide savings that arise due to staff turnover and the normal delays in filling vacancies. This credit budget has been removed for 2020/21 as any savings from delayed recruitment are being used to provide resource for vacancy coverage through either fixed term appointments and/or contractor engagement.

Operations and maintenance

8 Operations and maintenance costs have decreased by $529k, -8%. This reduction reflects the removal of the triennial election expenditure budget and reduced project management costs in BIS with this resource now being in-sourced and/or the costs being recorded against the relevant capital project.

Fees and charges

9 BIS: There has been no increase to fees while a LIM review is taking place.

10 Finance: The Finance credit card surcharge has not been changed, remaining up to 2% of the transaction value.

11 Governance: Copying and service fees have not been changed.

12 Governance and Support Services Group Fees are at Attachment B.

Levels of service

13 There are no changes proposed to the levels of service, performance measures and targets stated in the 10 year plan 2018-28 for the Governance and Support Services Group in the 2020/21 year.

Signatories

Author:	Gavin Logie - Financial Controller
Authoriser:	Sue Bidrose - Chief Executive Officer

Attachments

	Title	Page
⇩a	Governance and Support Services - Draft 2020/21 Operating Budget	232
⇩b	Governance and Support Services - Draft 2020/21 Fees and Charges Schedule	233

SUMMARY OF CONSIDERATIONS

Fit with purpose of Local Government

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	☒	☐	☐

Māori Impact Statement

Sustainability

10 year plan /Annual Plan / Financial Strategy /Infrastructure Strategy

This report provides an update on the development of the Annual Plan 2020/21 and implications for the 10 Year Plan.

Financial considerations

The financial considerations are detailed in the report.

Significance

There will be full engagement on the 2020/21 draft budget as part of the Annual Plan process, which will cover any issues of significance.

Engagement – external

The content of the Annual Plan 2020/21 is of interest to the community and there will be a full community engagement process.

Engagement – internal

Staff and managers from across the Council have been involved in the development of the draft budgets.

Risks: Legal / Health and Safety etc.

There are no known risks.

Conflict of Interest

There are no known conflicts of interest.

Community Boards

[1] Includes properties liable for 50% general rates.

Chairperson	Mayor Aaron Hawkins
Deputy Chairperson	Cr Christine Garey
Members	Cr Sophie Barker	Cr David Benson-Pope
	Cr RachelElder	Cr Doug Hall
	Cr Carmen Houlahan	Cr Marie Laufiso
	Cr Mike Lord	Cr Jim O'Malley
	Cr Jules Radich	Cr Chris Staynes
	Cr Lee Vandervis	Cr Steve Walker
	Cr Andrew Whiley

Author:	Lynne Adamson - Governance Support Officer
Authoriser:	Sharon Bodeker - Team Leader Civic