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Council Agenda 27 November 2014- OPEN of 121

Notice of Meeting: I hereby give notice that an ordinary Meeting of Hamilton City Council will be held on:

Date: Time: Meeting Room: Venue:

Thursday 27 November 2014

1.30pm

Council Chamber Municipal Building, Garden Place, Hamilton

Richard Briggs

Chief Executive

Council OPEN AGENDA

Membership

Chairperson Deputy Chairperson Members

Her Worship the Mayor Hardaker Cr G Chesterman Cr M Forsyth Cr M Gallagher Cr K Green Cr A King Cr D Macpherson Cr G Mallett Cr A O’Leary Cr R Pascoe Cr L Tooman Cr E Wilson Cr P Yeung

Quorum: A majority of members (including vacancies)

Meeting Frequency: Monthly

Jude Pani Democracy Manager

21 November 2014

Telephone: 07 838 6883 [email protected]

www.hamilton.govt.nz


Terms of Reference: To carry out leadership functions including advocacy and facilitation on behalf of the community.

To exercise all non-delegatable and non-delegated functions and powers of the Council.

To make those decisions which are required by legislation to be made by resolution of the local authority.

To consider any matters referred to it from any of the Standing or Special Committees.

To authorise all expenditure not delegated to staff or other Committees.

To receive the Council Risk Register and legal issues reports.

To receive reports from the Audit & Risk Committee.

To develop and approve the draft Long Term Plan (LTP) (including any amendments or variations) and Annual Plans (including the Budget and Funding and Financial policies); ensure their effective communication to the community; hear submissions and approve the final plan.

To approve the Hamilton Plan and to retain overview of it through setting direction on key strategic projects and receiving regular reports on its overall achievement

Make decisions in respect of District Plan matters.

The authority to agree to settle and submit draft consent orders to the Environment Court relating to an appeal on a Proposed District Plan, Plan Change, Plan Variation or Notice of Requirement to designate land or for a heritage order, or a resource consent application.

The authority to reject a private plan change request.

Financial: To determine all financial matters not delegated.

To receive reports of the exercise of financial delegated authority pursuant to the Public Bodies Contracts Act 1959.

To approve Council’s borrowing programme and treasury management strategy.

To undertake the statutory audit processes and to consider and approve the external audit arrangements, to receive the Auditor’s reports and to approve the audited annual report.

Procedural Matters: Delegation of all Committee powers.

Adoption of Standing Orders.

Confirmation of all Standing and Special Committee minutes.

Approval of Special Orders.

Employment of Chief Executive, setting of the Chief Executive’s performance targets and review of the Chief Executive’s Performance and Remuneration (in accordance with the Employment Agreement).

Other Delegations.


ITEM TABLE OF CONTENTS PAGE

Prayer and Acknowledgements

1 Apologies 4

2 Confirmation of Agenda 4

3 Declarations of Interest 4

4 Public Forum 4

5 Chairperson's Report 5

6 Council Minutes - 30 October 2014; 29 September 2014; 12 November 2014 6

7 Recommendations to Council - Strategy and Policy Committee Meeting 19 November 2014 37

8 LGA Compliance - Development Contributions Policy 39

9 2014 Rating Review – Consideration of Submissions and Decision-making 58

10 Asset Analysis - Clarence Street Theatre 77

11 Housing for Older Persons (Pensioner Housing) Review – Deliberations and Decision-Making 106

12 Resolution to Exclude the Public 121


The opening Prayer will be led by Carrie Barber representing the Quaker community of the Society of Friends 1 Apologies

2 Confirmation of Agenda The Council to confirm the agenda.

3 Declaration of Interest Members are reminded of the need to be vigilant to stand aside from decision making when a conflict arises between their role as an elected representative and any private or other external interest they might have.

4 Public Forum As per Hamilton City Council’s Standing Orders, a period of up to 30 minutes has been set aside for a public forum. Each speaker during the public forum section of this meeting may speak for three minutes or longer at the discretion of Her Worship the Mayor. Please note that the public forum is to be confined to those items falling within the terms of the reference of this meeting. Speakers will be put on a Public Forum speaking list on a first come first served basis in the Council Chamber prior to the start of the Meeting. A member of the Council Democracy Team will be available to co-ordinate this. As many speakers as possible will be heard within the allocated time. If you have any questions regarding Public Forum please contact Democracy by telephoning 07 838 6825.

Item

5


Committee: Council Date: 27 November 2014

Report Name: Chairperson's Report Author: Her Worship the Mayor

Hardaker

Status Open

Chairperson's Report – To be presented by Her Worship the Mayor Hardaker

council report

Item

6



Report Name: Council Minutes - 30 October

2014; 29 September 2014; 12 November 2014

Author: Jude Pani

Status Open

1. Recommendation

That Council confirm and adopt as a true and correct record the:

(a) Open Minutes of the Council Meeting held on 30 October 2014;

(b) Minutes of the Extraordinary Council Meeting held on 29 September for the Hearing of submissions to the Rating Review; and

(c) Minutes of the Extraordinary Council Meeting held on 12 November 2014 for the Hearing of submissions to the Housing for Older Persons Review.

2. Attachments

3. Attachment 1 - Ordinary Council Minutes - Open - 30 September 2014

4. Attachment 2 - Extraordinary Council Minutes - Hearing Rating Review 5. Attachment 3 - Extraordinary Council Minutes - Hearing Older Persons Housing Review

council report

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Council

OPEN MINUTES

Minutes of a Meeting of the Council held in Council Chamber, Municipal Building, Garden Place, Hamilton on Thursday 30 October 2014 at 1.35pm. PRESENT


Her Worship the Mayor J Hardaker Cr G Chesterman Cr M Gallagher Cr K Green Cr A King Cr G Mallett Cr A O’Leary Cr R Pascoe Cr L Tooman Cr E Wilson Cr P Yeung

In attendance Also in attendance:

Chief Executive, Chief Financial Officer, General Manager Customer Relationships, General Manager Performance, General Manager City Environments, General Manager City Infrastructure, General Manager Organisational Development , General Manager Community, General Manager Events and Economic Development, Programme Manager, Strategy and Relationship Management, Unit Manager Strategy and Research, Communication Unit Manager, Chief of Staff Mayoral Office, Director of Operations H3, Civic and Ceremonial Visits Coordinator, City Planning Unit Manager, Parks and Open Spaces Manager, City Waters Manager and Strategic Policy Analyst. Members of the River Plan Working Group: - Angus Mckenzie (Planner, Latitude Planning Services) - Jennifer Palmer (Brian Perry Charitable Trust, Te Awa River Ride Trust) - Mark Wassung (Architect, Design Engines Architects) - Annette Jones (Urban Designer, BECA) - Kiri Goulter (Chief Executive, Hamilton and Waikato Tourism)

Committee Advisors Mrs B Brooke and Mrs W Verschaeren

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The opening prayers were led by Anjum Rahman, representing the Waikato Muslim Association. Her Worship the Mayor Hardaker welcomed Richard Briggs as the new Chief Executive of the Hamilton City Council. She congratulated General Manager Organisational Development, Olly Te Ua, who was recently appointed Commanding Officer 3rd/6th Battalion, Royal New Zealand Infantry Regiment, with a promotion from Major to Lieutenant Colonel in the New Zealand Reserve Army. She also congratulated Councillor O’Leary who recently received her Resource Management Act Accreditation and completed the Governance Development Programme.

1. Apologies

Resolved: (Her Worship the Mayor Hardaker/Cr Chesterman)

That the apologies from Councillors Forsyth and Macpherson be received and accepted.

2. Confirmation of Agenda


That the Agenda be confirmed, noting that the Late Item (Victoria Bridge Temporary Road Closure for River Plan Event) be taken after Item 7 (Proposed Hamilton City River Plan).

3. Declarations of Interest Later in the Public Excluded section of the Meeting, Cr King declared a conflict of interest in relation to Item C3. He retired from the Meeting prior consideration of Item C3.

4. Public Forum No members of the public wished to speak.

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5. Chairperson's Report

Her Worship the Mayor Hardaker introduced her Chairperson’s Report, addressing the following three matters outlined in the Report:

Change in Appointment to Joint Organisation.

Representation to the Waikato-Tainui and Hamilton City Council Joint Management Agreement.

Hamilton City River Plan.

Resolved: (Her Worship the Mayor Hardaker/Cr Wilson)

Change in Appointment to Joint Organisation

That Cr O’Leary is appointed to the Waikato Regional Council – Middle Waikato Subcommittee (Project Watershed) to replace Cr Wilson.

Resolved: (Her Worship the Mayor Hardaker/Cr Pascoe)

Representation to the Waikato-Tainui and Hamilton City Council Joint Management Agreement

That the representatives to the Joint Management Agreement Governance Group to represent Hamilton City Council are Her Worship the Mayor Hardaker, Deputy Mayor Chesterman, Crs Gallagher, Forsyth and Mallett.


That the Report be received.

6. Ordinary Council Minutes - Open - 25 September 2014


That Council confirm and adopt as a true and correct record the Open Minutes of the Council Meeting held on 25 September 2014 noting the following amendments to the Minutes:

a) A spelling mistake required correcting in Item 4 - Public Forum, third paragraph of p.11, to read: “Mike Rolton, Vincentian Trust of St Vincent De Paul Society”.

b) With regards to Item 6 - Recommendations to Council from the Strategy and Policy c) Committee Meeting held on 3 September 2014, it was considered more appropriate to d) mention Crs O’leary/King as mover and seconder for each of the recommendations

in the resolution section as they were put separately.

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7. Proposed Hamilton City River Plan

The General Manager City Environments spoke to the Report, outlining the proposed Hamilton City River Plan for Council’s consideration to commence public consultation. He was joined by River Plan Working Group Members - Angus Mckenzie (Planner, Latitude Planning Services), Jennifer Palmer (Brian Perry Charitable Trust, Te Awa River Ride Trust), Mark Wassung (Architect, Design Engines Architects), Annette Jones (Urban Designer, BECA) and Kiri Goulter (Chief Executive, Hamilton and Waikato Tourism).

It was highlighted that:

This was a thirty year plan and the implementation of the River Plan would be very important and leave a lasting legacy for the city.

The plan was a fantastic opportunity for the city; it connected the city to the river while also providing strong links to Hamilton icons like the Hamilton Gardens and the bridges.

The development of the River Plan would also pose a challenge. Partnerships with community organisations and the business sector would be required to take it forward.

From a tourism point of view, the plan was very important, as its focus on the river would attract visitors to the city for years to come.

The community feedback on the proposed River Plan had been overwhelmingly positive.

A wider round of consultation would take place in November 2014 and after processing the feedback, staff would make final recommendations to Council.

The development of the River Plan went through a robust and rigorous process. The result was a framework that could be built on; the key point was that it was a visual representation that could be accessed and understood by everyone.

The General Manager City Environments responded to questions from Elected Members concerning:

When the engineering risks would be addressed. These were currently not included in the plan. General Manager City Environments responded that these would be included in the next phase of the project.

Whether the $10,000 remaining from the $200,000 budget, allocated to develop the River Plan needed to return to the general Hamilton City Council budget or would be used to initiate projects related to the plan. General Manager City Environments advised that when the total budget for the development of the River Plan was approved, it was defined that any surplus could be used to start implementing actions relevant to the River Plan.

Her Worship the Mayor Hardaker thanked the group responsible for the development of the River Plan. She also thanked Councillors O’Leary and Gallagher for their contributions to the River Plan. The development of the River Plan was a great challenge, but it would be an even bigger challenge to make the necessary implementations to see it come to fruition. Some of the required actions could be undertaken within the current budget, while others would need to be budgeted for and funded. The River Plan would constitute Council’s biggest contribution to the city and would require the investment of the Councillors’ commitment. Her Worship the Mayor Hardaker, Crs Gallagher and O’Leary (members of the River Plan Working Group) were thanked and acknowledged by their colleagues for their efforts and contributions to the River Plan.

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Resolved: (Her Worship the Mayor Hardaker/Cr O'Leary)

That:

a) the report be received,

b) Council adopts the proposed Hamilton City River Plan for consultation,

c) the River Plan Group considers the public feedback and reports back to the 11 December 2014 Council Meeting, and

d) Council publicly thanks the River Plan Working Group members for their contribution.

Cr Mallett Dissenting.

14. Victoria Bridge - temporary road closure for River Plan event

The Unit Manager Strategy and Research spoke to this Report asking the Council for approval to close Victoria Bridge on 16 November 2014 from 2-4pm for the River Plan Public Open Day.

It was highlighted that:

The closure of Victoria Bridge would take place from 2.00pm to 4.00pm on 16 November 2014 for the River Plan Open Public Day.

The River Plan Open Public Day was intended to engage the community with the river. People would be able to see the river from the Victoria Bridge.

The NZ Police were supportive of the closure.

The closure would coincide with the ‘Around the Bridges’ event, scheduled to take place during the morning of the same day.

Elected Members queried whether there was a cost involved with the closure and, if so, what the amount would be. Unit Manager Strategy and Research explained that the cost would be $800.

Resolved: (Cr Chesterman/Her Worship the Mayor Hardaker)

That:


b) approval be given for the closure of the Victoria Bridge on 16 November 2014 between 2pm and 4pm, and

c) Council gives public notice under section 11A of the Local Government Act 1974 of its decision to close this section of road under No 66, Schedule 10, Clause 11(e).

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8. Recommendation to Council - Finance Committee Meeting - 2 October 2014

Councillor Pascoe, the Chair of Finance Committee presented the recommendation of the Committee Meeting held on 2 October 2014.

Resolved: (Crs Mallett/Wilson)

Community Occupancy Application - Girl Guides

That

a) That Council approves the granting of a new community group lease to The Girl Guides Association New Zealand Incorporated located on part of land at Hamilton Gardens, being part of Pt Sec 29 Hamilton East TN BELT (Attachment A to the report to the Committee), subject to the following terms and conditions:

i. Term – five years commencing 2 October 2014,

ii. Rent – $257.50 plus GST per annum in accordance with 5.6 of the Community Occupancy Policy, and

b) Approves all other terms and conditions in accordance with the Community Occupancy Policy and Community Occupancy Guidelines.

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9. Recommendations to Council - Strategy and Policy Committee Meeting 15 October 2014

Cr O’Leary, Chair of the Strategy and Policy Committee, presented the recommendations of the Committee Meeting held on 15 October 2014.

She proposed to make an addition to the recommendation to be included as point e) of the Proposed Open Air Burning Bylaw to include the membership of the Open Air Burning Bylaw Subcommittee.

Resolved: (Crs O'Leary/Tooman)

1. Proposed Open Air Burning Bylaw

That:

a) Council determine that the proposed Hamilton Open Air Burning Bylaw 2014 is the most appropriate form of bylaw with the definition of Traditional Cooking Fire be updated to;

“Any Hangi, Umu or similar outdoor fire for the sole purpose of food preparation.”

b) Council determine that the proposed Hamilton Open Air Burning Bylaw 2014 does not give rise to implications under the New Zealand Bill of Rights Act 1990;

c) Council determine that Option 2 as presented in the staff report (with a hearing of submissions by an Open Air Bylaw Hearings Subcommittee of the S&P Committee) be used as the process for public engagement;

d) Council adopt the draft Statement of Proposal (including a Summary of Information) and draft Hamilton Open Air Burning Bylaw 2014 to commence public engagement; and

e) Council confirm the members of the Open Air Bylaw Hearings Subcommittee to be Councillors O’Leary (Chair), Forsyth, Pascoe, Tooman and Yeung.

Resolved: (Crs O'Leary/King)

2. Library Censorship Policy Review

That the Library Censorship Policy be deleted and key content be captured in a Management Policy that addresses both collection and censorship decisions.

Resolved: (Crs O'Leary/Chesterman)

3. Public Art

That the Council to endorse Mesh Sculpture Trust’s Yendell Park proposal at Stage One of the Public Art Development Process.

Cr Mallett Dissenting for Resolution 3.

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10. Major Events 2015 Update

General Manager Events and Economic Development assisted by the Director of Operations, H3, spoke to this Report. He updated Council on the City’s preparations for hosting three matches as part of the ICC Cricket World Cup in February and March 2015 and hosting eight matches in the FIFA U-20 World Cup in May and June 2015. It was noted that the web link provided under point 17 on p. 27 of the agenda referred to the wrong website. It needed to be replaced by the web link provided under point 16 of the Report. General Manager Events and Economic Development responded to questions from Elected Members regarding possible challenges involved with the ICC Cricket World Cup and the Fieldays being on at the same time and the road closure involved with the Family Fun Day. He advised that both accommodation and traffic would be challenges during the ICC Cricket World Cup 2015 and FIFA U-20 World Cup 2015 events and required careful consideration. Cr Pascoe was thanked and acknowledged for agreeing to be the Hamilton City Council ambassador for the ICC Cricket World Cup.


That the Report be received.

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11. Sub-Regional Waters Detailed Business Case

General Manager Performance spoke to this Report concerning the Sub-Regional Waters Detailed Business Case. He outlined that the Staff Report sought approval from Council for the consultant, project scope, cost allocation and governance arrangements for the business case analysis of collaboration in waters activities which was proposed as a joint project between Hamilton, Waikato, and Waipa Councils.

He pointed out that representatives from Hamilton, Waikato and Waipa Councils had met and had approved the recommendation in relation to this Item.

The total cost for the project would be $650,000; HCC’s contribution would be 50% ($350,000) and both Waikato and Waipa Councils would carry 25% each ($175,000)

General Manager Performance responded to questions from Elected Members concerning:

How the 50% contribution from Hamilton City Council compared to the actual representation of the share of Hamilton City. General Manager Performance responded that Hamilton City Council’s actual share would amount to 64% and that 50% was a favourable deal.

Whether Hamilton City Council’s internal costs were normally incorporated within existing budgets. General Manager Performance responded that this was normally not something that was done, however, in this case some of the internal costs would be included.

What an example of a non-asset owing structure would be, as mentioned under the first bullet point on p.38 of the Report. General Manager Performance responded that an example would be a company established to run the water in premises that would remain assets of the city.

Why the cost of the analysis to determine the best collaboration model was as high as $650,000. General Manager Performance explained that the analysis would be comprehensive and detailed to allow for an informed decision.

Whether this kind of work had been undertaken elsewhere in New Zealand and whether it was not possible to build upon robust studies undertaken by other Councils. General Manager Performance responded that this kind of work had indeed been undertaken elsewhere in New Zealand. He added however, that it would not be possible to build upon studies undertaken elsewhere as the study was very much inherent to each region.

Why it was necessary to have an independent Project Manager as well as a Project Group. General Manager Performance responded that the Project Manager would play a central coordinator role which was essential to keep the project on track. As this person needed to look after different Councils, it was crucial that this person was an independent professional.

Other services: these included the possibility of a peer review. Why was a peer review necessary? What portion the $100,000, allocated to Other Services, would be contributed to the peer review. General Manager Performance pointed out that the peer review would only take place if the Waters Governance Group found it necessary. Staff needed to check how much a peer review would cost.

How much would be allocated for a contingency plan. GM Performance explained that this would be approximately $30,000. He also stated that costs for professional services would not be spent without approval from the Waters Governance Group.

Why the completion of the business case could take until the end of 2015. General Manager Performance clarified that, although the report stated that the business case would be available in the second part of next year, it was expected that this would be finalised in July 2015 rather than December 2015.

If this was a Council Controlled Organisation (CCO) project, why was it not tested in the Long Term Plan Process. General Manager Performance said that this was discussed at

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length, but that unfortunately it did not line up with the timeframes for the Report.

Whether there would be further information about the proposed CCO limited liability company. General Manager Performance confirmed that this would happen.

Resolved: (Crs Mallett/Pascoe)

That:


b) Following a competitive procurement process, the Cranleigh consortium be appointed to prepare the detailed business case for collaboration in water, waste water and the inclusion of storm water at a total cost of $450,000 (representing $395,000 of joint Hamilton, Waikato and Waipa Council funded work and $55,000 of Waikato District Council funded work),

c) The scope of works for the detailed business case as outlined in Appendix 1 of the staff report be approved,

d) Hamilton City Council’s contribution to the project be $325,000 which is 50% of the total net project cost of $650,000,

e) The Terms of Reference, including membership, for a Waters Governance Group as outlined in Appendix 2 of the staff report be approved, and

f) Councillors Pascoe and Mallett be appointed to the Waters Governance Group.

g) That the Chief Executive works with Waikato and Waipa District Councils and Cranleigh to identify opportunities to shorten the timetable and the Chief Executive reports back to Council on this matter.

h) Council notes the $250,000 unbudgeted expenditure will be managed within the Council’s overall budget and reported through the Risks and Opportunities Report.

Crs Gallagher and Wilson Dissenting.

Cr Mallett retired from the Meeting (3.45pm) at the conclusion of the above Item.

The Meeting adjourned 3.45pm-4.00pm for Afternoon Tea.

12. RMA Consent Matters - Reporting of Commissioner Decisions

Resolved: (Crs Wilson/Chesterman)

That the information be received.

Cr Gallagher retired from the Meeting 4.00pm – 4.05pm during the above Item. He was not present when the matter was voted on.

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13. Ruakura Board of Inquiry – approval of the Ruakura Plan Change


That:


b) the Ruakura Plan Change, as determined by the Ruakura Board of Inquiry, be adopted by Council in accordance with section 149(w)(2)(b) of the Resource Management Act, and that the plan change be inserted as a new schedule into the Operative Hamilton District Plan (Waikato Version), and

c) Council authorises the publication of a public notice advising that the plan change has been approved.

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15. Resolution to Exclude the Public


Section 48, Local Government Official Information and Meetings Act 1987

The following motion is submitted for consideration:

That the public be excluded from the following parts of the proceedings of this meeting, namely consideration of the public excluded agenda.

The general subject of each matter to be considered while the public is excluded, the reason for passing this resolution in relation to each matter, and the specific grounds under section 48(1) of the Local Government Official Information and Meetings Act 1987 for the passing of this resolution follows.

General subject of each matter to be considered

Reasons for passing this resolution in relation to each matter

Ground(s) under section 48(1) for the passing of this resolution

C1. Ordinary Council Minutes - Public Excluded - 25 September 2014

C2. City Honours

C3. Proposed District Plan - appeals management

) Good reason to withhold ) information exists under ) Section 7 Local Government ) Official Information and ) Meetings Act 1987 )

Section 48(1)(a)

This resolution is made in reliance on section 48(1)(a) of the Local Government Official Information and Meetings Act 1987 and the particular interest or interests protected by Section 6 or Section 7 of that Act which would be prejudiced by the holding of the whole or relevant part of the proceedings of the meeting in public, as follows:

Item C1. to protect the privacy of natural persons Section 7 (2) (a) Item C2. to protect the privacy of natural persons Section 7 (2) (a) Item C3. on the grounds that a right of appeal lies to any

Court or Tribunal against the final decision of the Local Authority in this matter to enable Council to carry out negotiations to prevent the disclosure or use of official information for improper gain or improper advantage

Section 7 (2) (a) (i) Section 7 (2) (i) Section 7 (2) (j)

The Meeting moved into Public Excluded from 4.10pm until 4.20pm.

The Meeting was declared closed at 4.20pm.

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Extraordinary Council

OPEN MINUTES

Minutes of a Meeting of the Council held in Council Chamber, Municipal Building, Garden Place, Hamilton on Monday 29 September 2014 at 9.00am. PRESENT


Her Worship the Mayor J Hardaker Cr G Chesterman Cr M Gallagher Cr D Macpherson Cr G Mallett Cr A O’Leary Cr R Pascoe Cr L Tooman Cr E Wilson Cr P Yeung

In attendance Chief Financial Officer, Revenue Manager, Unit Manager Strategy and Research, Rates team Leader, Business Manager Economic Development and Lachlan Muldowney, City Solicitor, Tomkins Wake.

Committee Advisors Mrs J Pani, Mrs W Verschaeren & Miss J Humphreys

1. Apologies (Her Worship the Mayor Hardaker/Cr Wilson)

That the apologies from Councillors Green, Forsyth and King and for lateness from Councillors Pascoe and Gallagher be received and accepted.



That the Agenda be confirmed.

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3. Declarations of Interest

Councillor Chesterman advised that, as an owner of several properties in Hamilton City, he had sought advice on his participation in the rating review process from the Office of the Auditor-General (OAG) through the Democracy Manager. The OAG had advised the Democracy Manager that Councillor Chesterman’s interests were in common with a large number of other ratepayers and therefore could participate in discussion and voting on the rating review. Councillor King had previously declared a conflict of interest and was not participating in the review of the rating system.

4. Public Forum As this was a hearing of submissions there was no Public Forum.

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5. Hearing of Submissions to the Rating Review

The Summary of Submissions to the Rating Review had been previously circulated, along with a schedule of speakers who wished to be heard in support of their submissions. The individual submissions were available on the Council website at www.hamilton.govt.nz/ratingreview Speakers who wished to be heard in support of their submissions presented to the Council as follows:

Councillor Macpherson arrived at 9.05am prior to Submission No 407.

Submission 407 – Colin Jones spoke to his submission supporting the Capital Value Rating System with no differentials and percentage split between Residential, Commercial and Rural; the percentage split would defeat the purpose of the capital value system which should be a level playing field for both commercial and residential property owners. He opposed the proposal to transition to capital value over 10 years.

Councillor Pascoe arrived at 9.10am during Submission No 407.

Councillor Gallagher arrived at 9.15am after submission No 407.

Submission 469 – Christine Toy (on behalf of John Gallagher) spoke to the submission of Gallagher Group Ltd supporting the Capital Value Rating System and the proposal to transition to capital value over 10 years. She agreed that more capital value also means a higher usage of Hamilton City Council Services.

Submission 628 – Graeme Heap spoke to the submission of Scentre (New Zealand) Limited opposing the Capital Value Rating System and the proposed transition period of 10 years. The submission also recommended the removal of a differentiation should the Capital Value Rating System be adopted. A PowerPoint presentation was shown in support of this submission. He argued that the correlation between a higher capital value and higher usage of HCC services did not apply to commercial shopping centres. Mr Heap represented the Westfield/Chartwell Mall and the shop owners in that mall.

Submission 631 – James Gardner-Hopkins spoke to the submission of Progressive Enterprises Limited opposing the Capital Value Rating System. It was also suggested that Council could incorporate an additional differential for high capital to land value ratio properties. A document was tabled in support of this submission.

Progressive Enterprises Limited would provide additional information regarding: 1. Other Councils in New Zealand that applied specific mechanisms to resolve the inequities

inherent to the Capital Value Rating System (i.e. Taupo-Ruapehu). 2. The properties where the rates would increase in case the Capital Value Rating System was

adopted and the properties where the rates would diminish. (The introduction of the capital Value Rating System would increase the total amount of the rates over the 8 Hamilton sites by $ 124,815.97).

Submission 609 – Roger Clark spoke to the submission of Anglesea Medical Properties Ltd opposing the Capital Value Rating System as this would discourage economic growth in the CBD. The submission also opposed the proposal to transition to capital value over 10 years. A document was tabled in support of this submission.

http://www.hamilton.govt.nz/ratingreview

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Submission 622 – Greg Wills spoke to the submission of Kiwi Income Property Trust opposing the Capital value Rating System and the proposed transition period of 10 years. The submission also opposed retaining the split for rates collection in the different sectors (residential, commercial and rural). Kiwi Income Property Trust included the Centre Place Mall and other peripheral commercial properties in Hamilton CBD.

Kiwi Income Property Trust would provide additional information regarding: 1. The amount of rates paid by the Mall in Palmerston North.(also based on Capital value). 2. Other places in New Zealand where differentials were in place for large retailers.

Submission 318 - Branislav Milicich spoke to the submission of the B.P.Milicich Trust supporting the Capital Value Rating and the retaining of the rate differentiation for residential, rural and commercial sectors. He also supported the proposed transition period of 10 years, stating however, that this timeframe could be reduced.

The Meeting adjourned from 10.25am until 10.45am.

Submission 118 – Robert Poirier spoke to his submission opposing the Capital Value Rating System. He was of the opinion that the capital Value Rating system contributed to the creation and perpetuation of city slums and homelessness. It would also be a disincentive for landlords to invest and upkeep their rental properties. Submission 515 - Sathurappan SS Rajan spoke to his submission opposing the Capital Value Rating System. A PowerPoint presentation was shown and a document was tabled in support of this submission.

It was noted that staff would circulate the PowerPoint presentation to Elected Members. Submission 618 – Nerieda Emeades (supported by Michelle Padgett) spoke to the submission of Arawata Assets Limited opposing the Capital Value Rating System. Arawata Assets Limited managed all the freehold and leases of properties on behalf of ANZ in New Zealand. Their main concern regarded the overall rate increase and the affordability for the retailers; not so much the method used to calculate the rates.

Arawata Assets Limited needed to verify whether the current occupancy costs in Hamilton were lower than elsewhere in New Zealand.

Submission 680 – Peter Stewart spoke to his submission supporting the Capital Value Rating System. He opposed the proposal to transition to capital value over 10 years, stating that a transition period of maximum 2 years would be long enough for residential properties. A document supporting this submission had been circulated to the Elected Members. Submission 515 - Steve McLennan spoke to the submission of Waitomo Properties Ltd supporting the Capital Value Rating System. This submission opposed the proposal to collect the same percentage of rates from the Residential, Commercial and Rural Sectors. The current and proposed differential was considered excessive, and penalised commercial activity in Hamilton. The submission also opposed the proposed transition period of 10 years; however, a shorter transition period would be acceptable as this reduced the risk of possible change after future elections. Submission 446 - Eric Peter Krauliz spoke to his submission opposing the Capital Value Rating System as it was perceived to discourage owners making improvements to their properties.

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Submission 588 – Ivan Lang spoke to his submission opposing the Capital Value Rating System for residential ratepayers; he stated that this would replace one unfair system with another. This submission supported the proposed Capital Value Rating System for Commercial properties and the proposed transition period of 10 years. Submission 440 – Malcolm Barrett spoke to the submission of GBG Management Trust, Podium Investments Ltd, Alexandra Tower Ltd. opposing the Capital Value Rating System. The Capital Value Rating System favoured extensive land use while the current Land Value Rating System favoured intensive land use. The latter was perceived as facilitating the redevelopment of empty premises in CBD. Submission 594 – Geoff Monckton spoke to the submission of the Hugh Monckton Trust opposing the Capital Value Rating System as it would cut down any incentive to develop the city. It was perceived to remove sustainable competitive advantage, and sustainable economic growth. Several supporting documents were tabled to support this submission and a flipchart presentation was given.

The flipcharts would be available for further scrutiny by Elected Members after the Meeting. Submission 83 – David Peel spoke to his submission opposing the Capital Value Rating System. He stated that although there was no significant difference in the value of his and his neighbour’s properties, his rates would increase while his neighbour’s would diminish.

Staff to investigate the differentiation of the rates for these two properties. Submission 606 – Paul Knox spoke to the submission of Laras Holdings Ltd supporting the Capital Value Rating System. The submission also supported the proposal to retain the differentiation between the different rating sectors (residential, commercial and rural), as the ratios were well established. The submission opposed the proposal for a 10 year transition period. Submission 117 - Peter McLean spoke to his submission supporting the Capital Value Rating System. It was perceived to be a fairer system, bringing Hamilton in line with the other metropolitan cities in New Zealand. This submission also agreed with a 10 year or shorter transition period.

The Meeting adjourned from 12.45pm until 1.20pm. Submission 459 - Edward Joseph Fahey spoke to his submission opposing the Capital Value Rating System and the proposed transition period of 10 years. He supported the retaining of the differentiation between the different sectors of rate payers (residential, rural and commercial). Submission 341 - Beryl Blewett spoke to her submission opposing the Capital Value Rating System as this would increase the rates on her property. With superannuation as income, she was concerned about the affordability of the rates. Submission 518 - Jerome O'Sullivan spoke to the submission of Harvey Norman Properties (N.Z.) Limited, opposing the Capital Value Rating System as this would amount to a substantial increase of the store in Te Rapa’s rates. The submission also stated that if the Capital Value System would be adopted by Council, they would prefer that Council considered changing to an undifferentiated capital value system that does not retain the current percentages of rates from each sector. This would assist in better promoting business activity in Hamilton City.

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Submission 545 - Allen Bryce spoke to his submission opposing the Capital Value Rating System. He was of opinion that the Land Value Rating System attracted people to live and invest in Hamilton. A document was tabled in support of this submission. Submission 623 – Mark Gibb and James Gardner-Hopkins spoke to the submission of Fonterra Co-Operative Group Ltd opposing the Capital Value Rating System as the company would be significantly affected by its implementation. It was suggested that Council would further consider the implications of a change in rating system. A document was tabled in support of this submission.

Additional Information was requested regarding: 1. Similar operations in New Zealand that operate a different rating category, and 2. Fonterra advocating to other Councils for a change from a Capital Value Rating System to

a Land value rating System. Submission 468 - Len Helms spoke to his submission supporting the Capital Value Rating System and the retaining of the differentiation between the different sector of rate payers (residential, commercial and rural). He suggested to reduce the transit period to five years. A document supporting his submission had been circulated to the Elected Members

The Meeting adjourned at 2.30pm

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The Meeting reconvened on Tuesday 30 September 2014 at 1pm. PRESENT


Her Worship the Mayor J Hardaker Cr G Chesterman Cr M Gallagher Cr King Cr Green Cr D Macpherson Cr G Mallett Cr A O’Leary Cr R Pascoe Cr L Tooman Cr Wilson Cr P Yeung

In attendance Chief Executive, Chief Financial Officer, Revenue Manager, Unit Manager Strategy and Research, Rates team Leader and Business Manager Economic Development.

Apologies (Her Worship the Mayor Hardaker/Cr Chesterman)

That the apologies from Councillor Forsyth and for lateness from Councillors Macpherson and O’Leary, and for Item 5 from Councillor King be received and accepted.

6 2013/14 Annual Report

Consideration of the 2013/2014 Annual Report had been deferred to this Meeting by the Council on 25 September 2014, following Audit New Zealand making some late adjustments to the Annual Report. Updated copies of the 2013/14 Annual Report and 2013/14 Annual Report Summary were circulated to Elected Members on 26 September 2014 and were presented by the Chief Financial Officer for adoption.

Her Worship the Mayor Hardaker confirmed that she would write to Audit New Zealand expressing the frustration of Council at the very late notification of the required adjustments to the 2013/14 Annual Report.

Resolved: (Her Worship the Mayor Hardaker/Cr Mallett)

That

a) the report be received, and

b) the 2013/14 Annual Report and Summary, as circulated on Friday 26 September 2014, be adopted.

Councillor King left the Meeting at 1.05pm prior to Item 5 Hearing of Submissions.

The Meeting adjourned at 1.05pm and reconvened at 1.20pm.

Councillor O’Leary joined the Meeting at 1.20pm prior to submission 671.

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5 Hearing of Submissions to the Rating Review Cont’d

Submission 671 - Sara Pattison spoke to the submission of WEL Networks Ltd incorporating WEL Energy Trust and Ultrafast Fibre Limited. Although the submission did not support the introduction of the Capital Value Rating System, it was more opposed to the increase of the amount of rates . However, it was perceived that differentials applied to the rates could be acceptable.

WEL Networks Ltd would provide information regarding: 1. differentials applied by other Councils in New Zealand, and 2. the added cost for customers if the change to capital value would proceed.

The Meeting adjourned from 1.35pm to 1.55pm.

Cr Macpherson arrived at 1.55pm prior to submission 666.

Submission 666 - Tama Potaka, Mark Jackways and Mike Pohio spoke to the submission of Tainui Group Holdings Ltd. They acknowledged the probable need to move away from a Land Value Rating System. However they also emphasised that the introduction of a Capital Value System would not necessarily be the most equitable in terms of ratepayers meeting their fair share of costs. Their issues mainly centered around the timing of the change and the level of the increase. The submission strongly supported the removal of the differential applied to commercial properties as this would stimulate the economy. Any change to the rating system should be spread out over 20 years. A document was tabled in support of this submission.

Cr Wilson left the Meeting at 2.10pm during submission 666.

Submission 615 - Tony Begbie spoke to the submission of Waikato Property Investors Association in support of the Capital Value Rating System. It was a more transparent system and was a better representation of the economic value of a property. It also facilitated the comparison of investments and ownership costs for both residential and commercial investors. The submission supported the 10 year transition period.

Cr O’Leary left the Meeting at 2.20pm after submission 615.

The Meeting adjourned from 2.20pm to 3.05pm.

Submission 544 - Gerald Enright spoke to his submission opposing the Capital Value Rating System. The submission stated that if Council wanted to proceed further with this, a referendum needed to be held. Submission 551 - Carolyn McKenzie spoke to her submission opposing the Capital Value Rating System as it was perceived this system was unjust towards residential rate payers. Submission 657 – Michelle Baillie spoke to the submission of Skycity Hamilton Ltd opposing the Capital Value Rating System as this would increase the rates considerably. A document was tabled in support of this submission.

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Submission 248 - Bahirathy Loganathan spoke to his submission opposing the Capital Value Rating System as it would increase the amount of rates too much. He suggested using a system where rate payers would pay for the services they used. Submission 621 - Mischele Rhodes spoke to her submission opposing the Capital Value Rating System and the 10 year transition period.

Cr O’Leary joined the Meeting at 3.35pm after submission 621. Submission 607 – Ben Van Den Engel spoke to the submission of Ebbett Waikato Group / Anglesea Properties Ltd supporting the Capital Value Rating System. Submission 678 - Phil Lang, Stafford Hougthon and John Wood spoke to the submission of Hamilton Homezone Limited opposing the Capital Value Rating System. The submission also stated that, if the Council would accept the Capital value Rating System, the transition period should be at least 20 years long. Three documents were tabled in support of this submission. One of the tabled documents was a Report by the New Zealand Institute of Economic Research, written on behalf of Hamilton Homezone Limited. As possible solution to address potential inequities, it was suggested the Hamilton City Council could organise a meeting with the major stakeholders in the city.

It was noted that the link provided for submission 678 in the hearing schedule wrongly referred to submission 677.

Council staff were given permission to contact the authors on the NZIER Report.

Cr Macpherson left the Meeting at 4.15pm during Submission 678.

The Meeting adjourned at 4.50pm and reconvened at 6pm.

Submission 597 - Allan Davies and Jan Davies spoke to their submission opposing the Capital Value Rating System. This submission also stated that, if Council would proceed with the change of rating system, a 10 year transition period would be beneficial. A document was tabled in support of this submission. Submission 308 - Geoff Kreegher spoke to his submission opposing the Capital Value Rating System. Submission 390 - Greg Blewett spoke to his submission opposing the Capital Value Rating System. A document was tabled in support of this submission. Submission 489 – Paul Bennett and Michael Savage spoke to the submission of Braemar Hospital and Braemar Hospital Charitable Trust opposing the Capital Value Rating System which would increase their rates considerably; 17.5% of their bottom line is going to the Council. The proposed capital Value Rating System did not take the charitable character of the Trust into consideration. It was suggested for the rating system to include remission of rates for appropriate organisations. A document was tabled in support of this submission.

It was requested that Braemar provide information regarding rate remissions given to charitable organisations by other Councils.

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Submission 566 – Michael Campbell spoke to the submission of Udy Investments Limited opposing the Capital Value Rating System as this would increase rates considerably. A document was tabled in support of this submission. Submission 634 – John Brugh spoke to his submission opposing the Capital Value Rating System. Submission 391 - Lionel William Bekker spoke to his submission opposing the Capital Value Rating System and the transition period of 10 years.

It was noted that it would be appropriate to provide more information to the public regarding the allocation of rate-money.

Meeting closed at 7.30pm.

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Extraordinary Council

OPEN MINUTES

Minutes of a Meeting of the Council held in Council Chamber, Municipal Building, Garden Place, Hamilton on Wednesday 12 November 2014 at 9.00am. PRESENT


Her Worship the Mayor Hardaker Cr G Chesterman Cr M Forsyth Cr M Gallagher Cr K Green Cr A King Cr D Macpherson Cr G Mallett Cr A O’Leary Cr R Pascoe Cr L Tooman Cr E Wilson Cr P Yeung

In attendance Chief Executive, General Manager Performance, Property Unit Manager, Unit Manager Strategy and Research, Programme Manager - Policy and Bylaws, Strategic Policy Analyst, Community Development & Leisure Manager, Senior Housing Officer and Strategic Property Unit Manager.

Committee Advisors Mrs J Pani, Mrs W Verschaeren & Mrs B Brooke

1. Apologies

There were no apologies.


The Mayor welcomed everyone to the Meeting and outlined the proceedings for the Hearings.

3. Declarations of Interest No members of the Council declared a Conflict of Interest.

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4. Public Forum As this was a hearing of submissions there was no Public Forum.

5. Hearing of submissions on the Housing for Older Persons (Pensioner Housing) Review

The Summary of Submissions to the Pensioner Housing Review had been previously circulated, along with a schedule of speakers who wished to be heard in support of their submissions. The individual submissions were available on the Council website at www.hamilton.govt.nz/housingreview Speakers who wished to be heard in support of their submissions presented to the Council as follows:

Submission 148 – David Waine spoke to his submission supporting Council’s proposal to sell the Council owned pensioner housing. He was of opinion that private organisations would be better equipped to deal with housing issues. To update or grow the existing housing stock Council would have to, either increase rates, or borrow money. Registered, privately owned social housing providers would be able to access governmental grants; they would also be able to access government funding to offer rental subsidies. He also stated that Council could put a restriction in the sale, ensuring current tenants were retained. He clarified that, in his submission, he considered non-profit, charitable entities as social housing providers.

Cr Macpherson arrived at 9.05am during submission 148. Cr Mallett arrived at 9.07am after Submission 148.

Submission 112 – Ian Grant spoke to his submission opposing Council’s proposal to sell the Council owned pensioner housing. He argued that pensioner housing had been Council’s core business for a very long time and that there was no need to change this. There would be an increased need for pensioner housing in the future to meet the demands of the growing aging population.

Submission 288 – Tony Begbie spoke to the submission of the Waikato Property Investors Association supporting Council’s proposal to sell the Council owned pensioner housing first to private social housing providers and afterwards to the open market. He stated that there was an increasing need for social housing for the elderly, the disadvantaged and for people with disabilities. Social housing providers would be better placed to provide housing services as they were able to access governmental funding.

Submission 139 – Mischele Rhodes spoke to her submission opposing Council’s proposal to sell the Council owned pensioner housing. She was of opinion that elderly people needed to have a secure home. The possibility that they might lose their home had put the current tenants under a huge amount of stress. She also stated that, although there was an increased need for pensioner housing, she did not see how Council could actually afford to increase its pensioner housing portfolio.

Submission 140 – Tom MacRae spoke to his submission opposing Council’s proposal to sell the Council owned pensioner housing. He claimed that Council had a social and ethical responsibility to ensure elderly people had proper housing. He pointed out that the properties had been paid for numerous times and, selling these would constitute asset stripping.

http://www.hamilton.govt.nz/housingreview

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Submission 153 – Anjum Rahman spoke to her submission opposing Council’s proposal to sell the Council owned pensioner housing. She was of opinion that providing housing for vulnerable senior citizens, was a key responsibility not only for local authorities, but also for the central government. Selling the pensioner housing portfolio could look attractive as a short term means to reduce debt; it could also be construed as a way to save money for the ratepayers. However, the funding and subsidies central government would offer private social housing providers would, in the long run, result in a tax increase. The tax payers would end up paying, but the reason for the tax increase would be hidden. She understood that Council was not able to receive government funding for social housing provision, but she clarified that this was the case for all local authorities and no other New Zealand Council had decided to sell their pensioner housing portfolio. She suggested consulting with other local authorities regarding possibilities of preserving the social housing stock. Submission 83 – Stephen Bright spoke to the submission of the Holy Trinity Anglican Church opposing Council’s proposal to sell the Council owned pensioner housing. He stated that Hamilton city was a great place to live, work and play. It was part of the Hamilton City Council’s mandate to continue to provide for the most vulnerable in society as this was part of Council’s vision and values. He agreed that, to ensure a positive outcome, services could be provided in collaboration with other agencies; to this intent, it would be appropriate to look at the Christchurch model.

Submission 87 – Roger Loveless spoke to the submission of CCS Disability Waikato opposing Council’s proposal to sell the Council owned pensioner housing. He pointed out that the number of people with disabilities increased majorly after the age of 65. The units that were currently part of Council’s pensioner housing portfolio were all, to a great extent, suited for people with disabilities. He urged Council not to rush into making a decision but, on the contrary, explore all possible options.

Submission 152 – Yvonne Wilson and Glen Tupuhi spoke to the submission of Te Rūnanga o Kirikiriroa in support of Council’s proposal to sell the Council owned pensioner housing. They explained that Te Rūnanga was already providing social housing services. The organisation had people’s best interest in mind and that might not be the case for private developers. They stated that Council should consider selling to the social housing sector and Te Rūnanga o Kirikiriroa was open to further develop its pensioner housing portfolio.

The Meeting adjourned for morning tea from 10.37am to 11.00am. Submission 183 and 184 – Roger Hennebry spoke as an individual and to the submission of Grey Power opposing Council’s proposal to sell the Council owned pensioner housing. He stated that he was in favour of keeping the existing pensioner housing portfolio. He expressed the concern that, if the portfolio was sold to a social housing developer, the focus might shift from the elderly to all categories of social disadvantaged people. Incorporating a restriction in the sale, ensuring the flats would remain pensioner flats, would be acceptable for Grey Power. It would however, be preferable to restrain from selling right now and investigate other options. He had suggested as a Councillor, reviewing the selling of pensioner flats two years ago, the amount of money it made and the amount of accumulated interest this provided. Perhaps it would be appropriate to incorporate the result of this review in the discussions about the Long Term Plan.

Submission 54 – Roslyn Lomas spoke to her submission opposing Council’s proposal to sell the Council owned pensioner housing. She stated that the proposal to sell the units caused a lot of stress amongst the tenants who were all between 60 and 90 years old. She proposed keeping the pensioner housing stock. She pointed out that, when signing the rental agreement, the tenants had to provide a medical certificate as proof of their independence. As independent people they did not require any wrap-around services provided by social housing providers. Furthermore, all wrap-around services were provided by different agencies at all times and could be accessed by tenants who required them.

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Submission 47 – Sue Moroney, Labour MP, spoke to her submission opposing Council’s proposal to sell the Council owned pensioner housing. She pointed out that her submission was not based on political ideology, but rather on personal passion. She was afraid that, if the Hamilton City Council progressed with the sale of the pensioner housing, it would constitute an asset sale and it would set Hamilton City Council apart from all other Councils in New Zealand. New Plymouth Council was the only other Council considering to sell its pensioner housing. However, they had abandoned that idea and decided instead to increase the number of units. She proposed Hamilton City Council keep the pensioner housing stock and collaborate with other social services providers to increase social housing in the city.

Submission 72 – Nic Greene, supported by John Gallagher, spoke to the submission of Habitat for Humanity Central North Island Ltd in support of Council’s proposal to sell the Council owned pensioner housing. He was of opinion that everyone deserved a decent place to live and that social housing services should be provided by those best equipped to do this. He was, however, opposed to selling the pensioner housing to the private sector. Habitat for Humanity would be able to guarantee that the portfolio would continue to be part of its business. The population was growing older and, to match this, the social housing provision should also grow. There was a increasing concern that Hamilton currently did not have a social housing strategy. He also pointed out that, if Hamilton City Council would sell its pensioner housing portfolio to Habitat for Humanity, the latter would make a long term commitment to grow the capacity of the pensioner housing.

Submission 162 – Eddie Mollier spoke to his submission and suggested that Hamilton City Council should sell its pensioner housing stock to habitat for Humanity or St Vincent de Paul as this would allow for accommodation supplements.

The Meeting adjourned for lunch from 12.30pm to 1.00pm.

Submission 29 and 186 – Rev, Dr Susan Thompson, supported by Karen Morrison-Hume spoke to the submissions of Waikato-Waiariki Methodist Synod and of Hamilton Church Leaders both opposing Council’s proposal to sell Council owned pensioner housing.

They outlined that there was considerable concern among the Church community regarding Council’s proposal and that the care of elders and those in need was seen as part of Council’s key responsibilities. Provision of social support, such as housing, kept elders healthy and out of poverty. They noted that the number of people needing this type of support would only increase in the future and did not accept that other social housing services, provided through the Government or otherwise, would be able to accommodate for this growing need on their own. Selling Council owned pensioner housing would only exacerbate the need.

They urged Council to think more widely around the City’s future social housing needs. They supported DV Bryant Trust Board’s submission that a Social Housing Plan be developed for Hamilton through partnerships and funders drawing on a range of expertise, ideas and support to formulate a comprehensive plan.

Submission 257 – Moses Cherrington spoke to his submission commending Council on its prudence in developing a proposal and for affording a process where feedback could be given through a formal process. He went on to say that he opposed Council’s proposal to sell pensioner housing for a number of reasons, including that the arguments and evidence outlined in Council’s report concerning pensioner housing were in his opinion fallacious and flimsy. He outlined that Council needed to act fastidiously around the care of its City’s elders and maintain the status quo.

Submission 141 – Dr Rose Black and Anna Cox spoke to the submission of Poverty Action Waikato opposing Council’s proposal to sell Council owned pensioner housing. They outlined that Council was seen to be a caretaker of resources and assets for the common good and that provision of pensioner housing was part of this. They tabled a document showing the ‘Journey of Common

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Good’ and lamented that we seemed to exist in a time where common good was not valued as it once was. Local and Central Government had a responsibility to ensure provisions for social housing were available for the most vulnerable members of society. They urged Council to consider the common good in making their decision and remain with the status quo.

Submission 151 – Neil Tolan spoke to the submission of Western Community Centre opposing Council’s proposal to sell Council owned pensioner housing. He listed a number of reasons why Council should not sell pensioner housing, including that there was currently a lack of affordable housing and that selling the pensioner housing would only be contributing to an already problematic situation. He pointed out that pensioners had contributed greatly to the community both in the past and present and that society was judged on how it treated the young and elderly. He expressed concern that the possibility of pensioner housing being sold was causing great stress and worry for the current tenants of the pensioner housing units. He urged Council to look at putting together a wider Social Housing Plan to account for the future needs of the community.

Submission 102 – Ian Bridge spoke to his submission opposing Council’s proposal to sell Council owned pensioner housing. He had been approached by three pensioners asking him to speak on their behalf. He outlined that Council’s decision should not be based on return of investment but rather it should be weighed against benefits to the community. The split of costs to the ratepayers of the pensioner housing units was miniscule in comparison to the benefits the housing provided for the community. He noted that the need for more social housing would increase in the coming generations and that Council should be planning ahead for this. He urged Council to leave a lasting legacy so that in twenty year’s time, they could look back and be proud of the decision they made in this area.

Submission 298 – Barry Cope spoke to his submission opposing Council’s proposal to sell Council owned pensioner housing. He pointed out that Local MP, David Bennett, had advised that it was not Central Government’s intention to exclude Local Government from social housing. He urged Council to be compassionate in their decision and asked that Council look closely at what Christchurch Council had been doing in the social housing area and maintain the status quo.

Submission 300 – Deacon Peter Richardson representing Reverend Dennis Browne spoke to submission of the Catholic Bishop of Hamilton outlining their opposition to Council’s proposal to sell Council owned pensioner housing. He pointed out that the City would need significantly more social housing in the future and that by selling pensioner housing, Council would be adding to an already stretched social housing shortage. He was concerned that Council deemed pensioner housing to be of lesser priority or importance than other projects. He suggested that Council look into the work Christchurch City Council had carried out in this area and urged Council to maintain the status quo.

Submission 221 – Rowena Kaleopa spoke to her submission opposing Council’s proposal to sell Council owned pensioner housing. She outlined that in her view, ratepayer’s money should be focused on matters such as social housing rather than on formulating plans. She was concerned that elderly people may be left with nowhere to go if pensioner housing was sold.

Submission 95 – Pat McNair spoke to her submission opposing Council’s proposal to sell Council owned pensioner housing. She was concerned that pensioner housing seemed to be an easy target for Council to try to reduce its debt and urged Council to be compassionate in their decision making on the matter. She outlined that the people living in pensioner housing did not require rest home care, but did not have the money to be able to afford to live in a retirement village, should pensioner housing be sold, there would be nowhere for these people to go. She reminded Council that today’s workers were tomorrow’s pensioners and that the need for pensioner housing would increase dramatically in the future. She asked that Council maintain the status quo and plan ahead for the increasing needs of future generations.

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Submission 253 – Barry McNair spoke to his submission opposing Council’s proposal to sell Council owned pensioner housing. He outlined that in his view, there should be a distinction between pensioner housing and social housing, as pensioners had different requirements and this needed to be appropriately considered. He pointed out that the need for pensioner housing would increase dramatically in the future. He also noted that in his view, Council should have considered the issue of pensioner housing through a tribunal because of the complexity of the issue and the number of stakeholders involved. He asked that Council maintain the status quo.

Submission 284 and 285 – Lindsay Cumberpatch spoke to the submissions of DV Bryant Trust Board and Hamilton Christian Nightshelter Trust, and Doug Arcus as Chair of the DV Bryant Trust Board also spoke to their submissions, opposing Council’s proposal to sell Council owned pensioner housing in most respects. They noted that DV Bryant Trust had a strong history with social housing services and outlined that the heart of their concern with Council’s proposal was that a wider Social Housing Plan had not been developed through the Working Group. They asked for Council to consider developing a Social Housing Plan in consultation with other social housing providers and potential funders. In the mean time, Council should not sell its pensioner housing stock to anyone other than social housing providers. They pointed out that in their view, access to adequate housing was a fundamental human right and that all areas of the community needed to be considered, not just pensioners. They went on to say that DV Bryant Trust was keen to work with Council on developing a Social Housing Plan for Hamilton and also potentially contributing to funding for this.

The Meeting adjourned for afternoon tea from 3.00pm to 3.35pm.

Submission 275 – Andrew Wilson spoke to the submission of Accessible Properties New Zealand Ltd in support of Council’s proposal to sell Council owned pensioner housing. Mr Wilson outlined that Accessible Properties New Zealand Ltd were a registered social housing provider and managed New Zealand’s largest social housing portfolio. He went on to say that the submission was in support of Council selling its pensioner housing stock to social housing providers but not to selling them on the open market. He pointed out that selling pensioner housing to registered social housing providers would provide a great opportunity to more widely utilise the existing housing for people in Hamilton with the highest social support needs. This may include people without homes, people with disability and health support needs, immigrants seeking a new start, as well as the elderly with limited means. In addition to this, social housing providers have strong links with other social support agencies which would offer further wrap-around support for prospective tenants in need. This would ultimately benefit the city. Social housing providers also had the ability to operate more efficiently in the area of social housing than Council as a result of working on a larger scale. Mr Wilson expressed that should Council decide to sell the pensioner housing, Accessible Properties New Zealand Ltd would be interested in purchasing some or all of the properties. He asked that Council consider flexibility around negotiation time frames for any sales to social housing providers. Submission 115 – Carolyn McKenzie, supported by Dawood Latif (Chaplain), spoke to the submissions of Patients’ Rights Advocacy Waikato Inc opposing Council’s proposal to sell Council owned pensioner housing. Ms Mckenzie outlined that the members of Patients’ Right Advocacy Waikato Inc were very disappointed at the prospect of the potential sale of pensioner housing. She was concerned that Council seemed to consider pensioners as a problem and that pensioners were being unfairly treated and abandoned by the current Council. She noted that these community members had contributed greatly to the City in the past and present and should be looked after in the future. Mr Latif was concerned that any funds made from any sale of pensioner housing would not be used towards social issues and that Council’s priorities seemed to be askew. They asked that Council maintain the status quo.

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Submission 23 – Barry Thompson spoke to the submission of St Vincent de Paul Society – Hillcrest Branch opposing Council’s proposal to sell Council owned pensioner housing. Mr Thompson queried what the advantage to Council would be in selling the pensioner housing. He was concerned that Council was going to make a rash decision regarding selling pensioner housing and that current and future needs of the community were being overlooked. He expressed that in his view, Council should be prioritising funds to be spent on areas such as pensioner housing over other areas such as parks or stadiums.

Submission 287 – Alvina Edwards, supported by fellow Trust member Michelle Williams, spoke to the submission of Hamilton Homeless Trust opposing Council’s proposal to sell Council owned pensioner housing. Ms Edwards advised Council that her mother lived in one of the pensioner housing units and that it was her home. Since hearing of the potential sale of pensioner housing, Ms Edwards’ mother had suffered due to the uncertainty she faced regarding her home.

Ms Edwards stressed that there was a difference between social housing and pensioner housing and that the Council needed to recognise this. Pensioners often had very different needs and requirements than other social housing users. She noted that the majority of pensioners did not require any wrap-around services that were associated with social housing providers and that most of the time, their needs were based on needing affordable, safe housing so that they could live together in a secure community based environment. She reminded Council that adequate housing was fundamental to human wellbeing. Ms Edwards called for Council to halt any pensioner housing sales and complete a proper Social Housing Plan with specific allocation for pensioner housing. She urged Council to stay with the status quo and to think more widely regarding Hamilton’s social housing needs.

Submission 235 – Ray Pickett spoke to the submissions of Eastside Apostolic Foundation Trust in support of Council’s proposal to sell Council owned pensioner housing to social housing providers. He advised Council that the Eastside Apostolic Foundation Trust had a long term strategy to become more involved within the social housing sector. They would like to be a part of the solution to provide some hope and support for the residents of pensioner housing. He outlined that selling pensioner housing stock to social housing providers would potentially enable specialists in the charitable sector to provide affordable social housing options without financially constraining Council. He also noted that he would like to register interest with Council that the Trust would be interested in purchasing some of the pensioner housing units should the decision be made to sell them. The Trust would be willing to go through the process to become a registered social housing provider. Should Council choose not to sell the pensioner housing stock, the Trust would still like to be a part of the solution and work with Council in coming up with a Social Housing Plan for Hamilton.

Cr Green retired from the Meeting at 4.55pm after submission 235.

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There was discussion on additional information that Elected Members required to be provided for the Working Group Meeting to be held Friday 14 November 2014. It was confirmed that this information would be circulated to all Councillors or addressed in the report to Council on 27 November 2014. The following requests were noted:

Up to date information regarding the Christchurch City Council social housing model.

A list of social housing providers that have indicated an interest in taking over Hamilton City Council’s pensioner housing and their track record/background/status.

Clarity of financials – including renewals over the last 2 years. To be provided to submitter Roger Hennebry.

Ministerial statement referred to by submitter Sue Moroney indicating Government support.

Clarity when the properties were sold in 2012; and

Outcomes of the 2012 sale of Council property including the current situation.

Clarity on the development of a process for a housing plan.

Check the availability of subsidies and whether there is an opportunity for negotiation with Central Government. Would the same as given to the people of Christchurch be available to Hamilton?

Submission (number 171) from B & J Butcher was circulated after the Meeting to Elected Members as requested by Mr and Mrs Butcher as they were unable stay at the Meeting to speak to their submission.

The Meeting was declared closed at 5.10pm.

Item

7



Report Name: Recommendations to Council -

Strategy and Policy Committee Meeting 19 November 2014

Author: Jude Pani

Status Open

Councillor O’Leary, the Chair of Strategy and Policy Committee will present the recommendations of the Committee meeting held on 19 November 2014.

The 19 November 2014 Strategy and Policy Committee agenda is available via the following link:

http://www.hamilton.govt.nz/AgendasAndMinutes/Strategy%20and%20Policy%20Committee%20Agenda%2019%20November%202014.pdf

Copies of the documents for adoption, can be accessed via the Committee Agenda link, and will be available at the Meeting.

Recommendations to Council:

1. Significance and Engagement Policy

That the Council:

a) Adopts the draft Significance and Engagement Policy, and

b) Deletes Council’s current Significance Policy.

2. Cemeteries Management Plan

That the Council:

Approves the Hamilton Cemeteries Draft Management Plan (2014) for public consultation.

3. Libraries Review – Strategic Plan

That the Council:

Adopts the Hamilton City Libraries Strategic Plan 2015-2025.

4. Dog Exercise Area Plan

That the Council:

Approves the Dog Exercise Area Plan (as tabled at the Committee Meeting).

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5. Safety in Public Places Bylaw 2014 Adoption Report

That the Council:

a) Amends the draft Safety in Public Places Bylaw 2014 with the following changes:

(i) Amend part a) of the definition of ‘Nuisance’ to ‘The definition in section 29 of the Health Act 1956 so far as it relates to Council functions’

(ii) Amend part (f) of the definition of ‘Nuisance behaviour’ to ‘Any conduct in a public place that is likely to cause unreasonable interference with the peace, comfort or convenience of a reasonable person in the circumstances in which it occurs, whether or not that person is in a public place, to the extent that it disturbs public order and is more than those subjected to it should have to tolerate’

(iii) Amend the definition of ‘Offensive behaviour’ to ‘Behaviour in a public place that is capable of arousing real anger, resentment, disgust or outrage in the mind of a reasonable person, objectively assessed, to the extent that it disturbs public order and is more than those subjected to it should have to tolerate’

(iv) Include a separate note (which is part of the bylaw) and sets out the following:

‘Note: This bylaw is required to comply with the New Zealand Bill of Rights Act 1990, which protects freedom of expression among other rights. The mere fact of participating in a public protest will not, on its own, constitute offensive or nuisance behaviour. Public order is sufficiently disturbed if the behaviour causes offence of such a kind or to such an extent that those affected are substantially inhibited in carrying out the purpose of their presence at that place’

(v) Replace the word ‘coffee’ with ‘caffeine' in the definition of ‘mind-altering substances’

(vi) Remove the reference to Police Officer in the definition of ‘Authorised officer’, replacing it with ‘Means any enforcement officers appointed and warranted by Council under the Local Government Act 2002’

(vii) Adjust the numbering of the bylaw so it is correctly sequenced.

(viii) Amend part a) of the definition of ‘nuisance behaviour’ to ‘Begging in a public place in a manner that is likely to cause harassment, alarm, or distress to any reasonable person, or causes an unreasonable interference with the peace, comfort or convenience of any person.’

b) Adopts the Safety in Public Places Bylaw 2014 and it comes into force on 15 December 2014.

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Report Name: LGA Compliance -

Development Contributions Policy

Author: Greg Carstens

Report Status

Open

Strategy, Policy or Plan context Development Contributions Policy

Financial status There is not budget allocated

Assessment of significance

Having regard to the decision making provisions in the LGA 2002 and Councils Significance Policy, a decision in accordance with the recommendations is not considered to have a high degree of significance

1. Purpose of the Report 2. To adopt a proposed approach for changes to Council’s Development Contributions (“DC”)

Policy in order to comply with specified provisions in the recently amended Local Government Act 2002 (“LGA”).

3. Executive Summary 4. The amended LGA requires Council to make publically available, by 1 December 2014, a

document that outlines any amendments to its DC Policy required to comply with new legislation in three specified areas:

1) Community Infrastructure contributions;

2) New Purpose and Principles provisions; and

3) Reserves contributions for non-residential developments.

5. The intention of this requirement is to provide the public with early disclosure of how councils intend to comply with the new legislation, ahead of formal consultation in April 2015 and adoption of a revised policy by 1 July 2015.

6. On 28 August 2014 Council adopted two additional schedules to its DC Policy to comply with changes to the LGA. Due to high levels of DC revenue and the restrictive new definition of Community Infrastructure in the LGA, Council also resolved to suspend charging all development contributions for Community Infrastructure until the 2015 Development Contributions Policy Review is completed.

7. The situation in relation to community infrastructure has not altered, and staff recommend that it would be prudent at this point that Council continue its current approach.

8. Council has taken legal advice on these matters.

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9. There are also a series of policy options for Council to consider as part of the 10-Year Plan Council Meetings by February 2015. These are not strict compliance matters and as such will be put to Council as a separate report.

10. Recommendation/s from Management

a) That the report be received

b) In accordance with the Local Government Act 2002 (“LGA”), that Council make publically available by 1 December 2014 a proposed approach to amending its Development Contributions Policy for adoption by 1 July 2015.

c) That Council’s resolve as a proposed approach to amending its Development Contributions Policy by 1 July 2015 to;

1) not charge community infrastructure development contributions;

2) in respect of new development contribution Purpose and Principles provisions in the Act to;

i. adopt a statement in the form of Attachment 2 of this report, to demonstrate compliance with the LGA; and

ii. adopt a schedule in the form of Attachment 3 of this report, being a table of allocation of development contributions revenue received to date against growth project costs being recovered by development contributions.

d) not charge reserves development contributions on non-residential components of any development consented after the legislative changes came into effect on 8 August 2014.

11. Attachments

12. Attachment 1 - Analysis - charging for Community Infrastructure

13. Attachment 2 - Development Contributions Purpose and Principles 14. Attachment 3 - Allocation of DC revenue to growth projects - current Policy

15. Key Issues 16. On 8 August 2014 the amendments to the LGA came into force and Council was required to

comply with this legislation immediately, subject to certain “transitional provisions”. These transitional provisions include a 1 December 2014 public disclosure requirement.

17. Council adopted its operative policy on 1 July 2013 under the previous legislation. Council is now in the process of the 2015 DC Policy Review, in alignment with the 2015-25 10-Year Plan, and it will be adopted and operational from 1 July 2015.

18. Section 9(2) of Schedule 1AA of the LGA requires Council to make publically available, by 1 December 2014, a document that outlines any amendments to its DC Policy required to comply with new legislation in the three areas as outlined in the Executive Summary.

19. These are referred to as the “specified provisions” being sections 50, 51(2), and 53 of the Local Government Act 2002 Amendment Act 2014.

20. Council is required to adopt an approach (not a final policy position) compliant with these provisions by 1 December 2014. It does not require Council to have a fully updated draft DC

http://www.legislation.govt.nz/act/public/2002/0084/latest/link.aspx?search=sw_096be8ed80edd988_1AA_25_se&p=1&id=DLM5707244



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policy at this time. The provisions are designed to promote early disclosure of Council’s approach to complying with these key areas of legislative change.

21. Charging Community Infrastructure DC’s

22. At a 28 August 2014 Council Meeting, it was resolved to cease charging any DC’s for community infrastructure (“CI”), on either consents already granted or new consents, following staff advice that Council had fully recovered its CI programme as redefined by the amended LGA.

23. At that meeting, Council agreed to review its position until the 2015 DC Policy Review is completed (1 July 2015) alongside the 2015-25 10-Year Plan, in particular requiring greater certainty of Council’s long term capital programme.

24. Council’s ability to continue to charge CI contributions is largely dependent upon its commitment to the Rototuna swimming pool and/or library, which were included in the CI charge under the 2006 and 2009 long term plans.

25. If Council was to include the Rototuna pool in the 30 year infrastructure plan, approximately $2.3m of CI revenue collected under previous DC Policies could be allocated to this purpose. If not, Council would likely be in a refund position.

26. Given the uncertainty on key projects, and the limited projects we can charge for going forward, there is a high risk currently if Council were to revert to charging for community infrastructure.

27. It is recommended that Council take the prudent approach, recommended in the 28 August 2014 Council Report, at this early 1 December 2014 statutory disclosure stage and continue with its current practice of not charging DC’s for CI.

28. Refer to Attachment 1 for further discussion.

29. Development Contributions Purpose and Principles

30. The recently amended LGA includes a new section outlining the purpose and principles of development contributions. Council is required to demonstrate how its policy complies with these provisions, and to propose amendments in cases in which it does not comply.

31. Note these sections are paraphrased and full explanations are provided in Attachment 2.

32. Purpose

33. The new Purpose requires that councils only recover from developers fair, equitable, and proportionate levels of DC’s to service growth over the long term.

34. It is the position of Council that its DC Policy is already compliant with this Purpose.

35. Principles

36. Section 197AB of the LGA sets out 7 new development contributions Principles:

37. (a) Councils can only charge DC’s where developments generate new or additional demand on Councils networks.

38. No amendment is required, as this is explicitly addressed in the current policy.

39. (b) Charges must be general consistent with capacity lives of assets recovered.

40. As part of the 2015 Policy Review, the recovery period for each project will be reviewed and adjusted if necessary in order to comply with this provision.

41. (c) Cost allocations should be based on analysis of causes and benefits.

42. No significant changes to the current methodology required.

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43. (d) DC’s must be used for the purpose required and in the district they were required.

44. Council’s DC revenue is already allocated in accordance with these principles.

45. (e) Council should publically disclose what DC’s are being used for and why they are being used.

46. A table of the allocation of DC revenue to growth projects so satisfy this requirement for the current policy is shown in Attachment 3 to this report.

47. (f) DC’s should be predictable and be consistent with Council’s DC policy.

48. Council’s current DC policy sets out how it complies in respect of principle.

49. (g) Catchment areas must balance practical considerations with fairness and equity; and avoid citywide charging wherever practical.

50. Council’s current DC policy already groups developments by catchments in accordance with these principles.

51. Reserves Contributions for non-residential developments

52. Under the new legislation, Council is unable to charge reserves DC’s to non-residential developments. Council has already stopped charging any reserves DC’s for non-residential developments as resolved at its 28 August Council meeting. The 2015 version of the DC Policy will be amended to reflect this with that the inclusion of the following wording: “There will be no charge for the Reserves component for non-residential developments for consents lodged after 8 August 2014”.

53. Financial and Resourcing Implications 54. None

55. Risk 56. If Council does not resolve to take a position on this issue at this time it will be unable to

comply with the 1 December 2014 timeframe set by the LGA, and would be non-compliant, and potentially be at risk of an administrative Judicial Review.

57. If Council adopts the recommendations of this report, there may at a later point be a perception of inconsistency if Council departs from the direction set. Any such departure would however be subject to consultation alongside the 10-Year Plan.

58. Given the uncertainty on key community infrastructure projects, and the limited projects Council can charge for them under amended legislation, there is significant risk currently if Council were to revert to charging for community infrastructure before certainty of the 2015-25 10-Year Plan and 30-Year Infrastructure Strategy capital programme was obtained.

Signatory Authoriser Blair Bowcott, General Manager Performance Group

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Report Name: 2014 Rating Review –

Consideration of Submissions and Decision-making

Author: John Gibson

Report Status Open

Strategy, Policy or Plan context

Revenue and Financing Policy

Rates Remission Policy

Funding Needs Analysis

Rating Policies

Financial status There is budget allocated

Amount $200,000


Having regard to the decision making provisions in the LGA 2002 and Councils Significance Policy, a decision in accordance with the recommendations is considered to have a high degree of significance.

1. Purpose of the Report 2. The purpose of this report is to summarise the matters that arose during the Special

Consultative Procedure on the Rating Review Proposal and to recommend a change to capital value rating.

3. Executive Summary 4. Council started the Rating Review on 27 March 2014. It considered options through a series of

workshops and meetings before finalising the proposal reflected in the Rating Review - Statement of Proposal on 31 July 2014 (the “Proposal”). A special consultative procedure was undertaken and concluded with Council receiving 666 submissions and hearing 42 submissions on 29/30 September 2014.

5. At 666 submissions the number of submissions is low when compared to the number of submissions from previous rating proposals.

6. Council received a number of well prepared and presented submissions. An Elected Member briefing was held on the 30th of October 2014, post hearings, to receive and discuss submissions and hearing themes from staff. There are no matters of significance that arose that result in a requirement to amend or reject the Proposal. It is therefore recommended that the rates review be concluded with the adoption of the proposal as outlined in the Statement of Proposal.

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Recommendations from Management

a) That the report be received

b) That the proposal as stated in the Statement of Proposal be adopted:

(i) That Council changes to a capital value general rate.

(ii) That the amount of general rate collected from each sector is Residential 65%, Commercial 34% and Rural 1%.

(iii) That the general rate rating categories will be Commercial, CBD Commercial, Residential and Rural.

(iv) That the remissions policy remits rates for water, wastewater and refuse collection on rating units where those services are unavailable.

(v) That the change from land value to capital value is transitioned over 10-Years.

c) That staff develop the necessary technical policies to enable implementation of the amended rating system to take effect on 1 July 2015.

7. Attachments

8. Attachment 1 - Analysis of Submissions 9. Attachment 2 - Summary Economic Analysis

10. Process to date 11. Council has been considering its options for the rating system since 27 March 2014 when it

resolved to undertake a review.

12. Council has held three public workshops to consider options for changes to the rating system.

13. On 31 July 2014 Council adopted the Rating Review - Statement of Proposal and in doing so commenced a Special Consultative Procedure. The consultation period ran from 8 August to 8 September 2014 and hearings were held on 29/30 September 2014.

14. A briefing of elected members was held on the 30 October 2014, post hearings, to receive and discuss the themes that arose from the submissions and hearings. This briefing also considered legislative compliance and legal issues as outlined in section 15 below.

15. Legislative requirements or legal issues 16. Changing a rating system affects all ratepayers to some degree and in this proposal, some

ratepayers to a large degree. Because this is a decision of high significance, a Special Consultative Procedure under the Local Government Act 2002 has been carried out.

17. Through the submission and hearing process a number of commercial submitters highlighted the substantial rate increases they would attract under the proposal. Careful consideration has been given to those submissions and the various options for reducing those increases.

18. The recommendations in this report do not support modifications to the proposal in order to reduce those rate increases.

19. While making modifications of this nature could be introduced to mitigate these submitter concerns, they are not necessary to ensure legal compliance, and would have the effect of shifting part of that rating burden to other ratepayers.

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20. Council should however be aware that without making such modifications, it increases its risk of a legal challenge in respect of its decision. This is because the financial implications for some of these larger commercial ratepayers, which are most affected by the rate increases over time, are substantial and may justify the cost and expense associated with a legal challenge. Based on these factors, while the proposal may be legally compliant, the risks of a legal challenge are nevertheless high.

21. No other matters arose during the consultation and hearings that require a change to the Statement of Proposal.

22. Consultation Process 23. Council undertook a formal consultation from 8 August to 8 September 2014.

24. The consultation involved making the following information available:

Summary of Statement of Proposal (posted to all ratepayers and on website)

Letter to all ratepayers, including effect of rates impact (posted)

Statement of Proposal (Libraries and Website)

Additional Information, analysing options in detail (online)

Workshop presentations from 3 workshops (public meeting and on-line)

Reports to Council from 26 June and 31 July (public meeting and on-line)

Rates Calculator (online)

25. Council conducted 3 official public meetings, in different areas of the city, as well as attending meetings of other organisations. Staff, including the CFO, and elected members attended these meetings.

26. Staff and elected members also attending a meeting organised by Citizens and Ratepayers Association.

27. Council placed advertisements in major newspapers.

28. Council promoted the review through radio interviews, City News, Council websites and social media.

29. Staff directly contacted the top 50 ratepayers with the largest increases to ensure the decision makers in those organisations were aware of the potential change.

30. Did the consultation process engage and inform the community, meeting the requirements of s.82 of the Local Government Act?

Compared to previous consultations, 666 submissions was a lower than expected response. Staff gave consideration as to whether the process had failed to inform and engage the community.

It was concluded that given the extensive amount of information that was distributed, the media coverage generated by other than Council itself (i.e. news articles, letters, blogs and other social media postings) and the high quality of submissions, that not only was the community engaged but they were also well informed.

It is the staff’s opinion that the requirements of s.82 have been exceeded.

31. Submission 32. A summary of the submissions, based on written comments, is attached as Attachment 1.

33. Council has read each submission and heard further explanation of those submissions from 42 of the submitters over two days of public hearings.

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34. All submissions are available on the Council website: http://www.hamilton.govt.nz/our-services/property-and-rates/rates/Pages/Rating-review.aspx

35. The hearings were recorded and can be replayed by following the Video on Demand link at: http://www.hamilton.govt.nz/our-council/livestream/Pages/default.aspx

36. Major Matters Raised by Submitters 37. Many matters were raised by submitters both for and against the proposal. While the majority

of the submissions (71%) opposed the proposal, they largely represented those ratepayers with larger increases. Ratepayers who would receive decreases made few submissions. No submitters submitted that they should pay more rates. There are 55,411 ratepayers in Hamilton and the overwhelming majority of ratepayers did not submit.

38. Staff have identified eight major themes that were raised by the submitters:

a. Submitters were more likely opposed to rates increases than being opposed to a capital value general rate.

Commercial Submitters

b. Large commercial submitters with large increases opposed the change to capital value and proposed a variety of solutions, whereas small commercials submitted in favour of the proposal.

c. Some submitters advised that capital value rating would inhibit future commercial investment.

d. Some submitters advised that the allocation of 34% of the general rate to the commercial sector was unfair and did not reflect the benefit received.

e. Some submitters operating outside of the CBD advised that they were subsidising the CBD differential and considered this an uneven playing field.

Residential Submitters

f. Submitters objected to high rates increases and did not see an increase in benefit for these rates.

g. Submitters advised that many residents on fixed incomes were adversely affected by the rates increases.

h. Submitters requested more user pays methods for charging rates.

39. Analysis of Major Matters Raised in Submissions 40. Staff have considered the major themes raised by submitters, alongside the proposal and

contrary submissions that were made by some submitters.

41. Submitters were more likely opposed to rates increases than being opposed a capital value general rate.

a. Of those opposed to the proposal, the largest proportion of submitters (102) made comments that have been summarised as “increases proposed under capital value are not affordable/rates are high enough already/do not want a rating system change that results in a rates increase”.

b. Submitters’ verbal responses to Councillor questions also supported that most were submitting against rates increases as opposed to a view that capital value rating is not appropriate.

c. 57 submitters stated they viewed land value as a better system, compared with 72 who submitted they viewed capital value as better.

http://www.hamilton.govt.nz/our-services/property-and-rates/rates/Pages/Rating-review.aspx

http://www.hamilton.govt.nz/our-services/property-and-rates/rates/Pages/Rating-review.aspx

http://www.hamilton.govt.nz/our-council/livestream/Pages/default.aspx

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d. Transitioning the change in rates over 10 years is a key tool Council has proposed to mitigate the effect of rates increases resulting from the change from land value to capital value. This significantly minimises the impact a single year increase would have on the majority of ratepayers, in all sectors, who are not able to immediately adjust their incomes for the resulting change in outgoings.

e. Council didn’t receive strong submissions on this proposal, although many of those that were received were for extending or reducing the timeframe for the proposal. Council had considered in the Statement of Proposal three options (the Statement of Proposal noted that if no transition was applied a move direct to capital value was preferred, the proposal also considered transition periods of 5 years and 10 years), deciding a 10 year transition was the most appropriate option. Council could adopt a capital value rating system with any of these options.

f. In conclusion, staff’s view is that the proposal to change to a capital value system with a 10 year transition was positively received by the community.

42. Large commercial submitters with large increases opposed the change to capital value and proposed a variety of solutions, whereas small commercials submitted in favour of the proposal.

a. The proposal redistributed the commercial sectors 34% share of the rating pie. This resulted in 75% of commercial ratepayers having a reduction and 25% of the ratepayers increasing. The proposal included some very large increases, with two ratepayers receiving $1m increases if the proposal is adopted as drafted. Council analysed these large increases in detail comparing rates across the city and with other cities. Council concluded the proposal was appropriate.

b. Detailed and comprehensive submissions were made.

c. While most submitters viewed capital value as a feasible option they requested that Council investigate options to modify the amount of the rates, including special differentials and rates capping and also that if the proposal was implemented that it was implemented in full over a longer period of time.

d. Staff note that any reduction in rates for these large ratepayers will result in increases in rates for other commercial ratepayers.

e. In conclusion, staff’s view is that no new information was raised by submitters that change the analysis that was undertaken prior to Council concluding the proposal was appropriate. It therefore remains appropriate to adopt the proposal unmodified.

43. Some submitters advised that capital value rating would inhibit future commercial investment.

a. The development and renewal of business is key to achieving many of the goals for the city.

b. Hamilton Homezone Ltd presented an economic analysis that stated land value was a more progressive rating system than capital value. This was a surprising and unexpected analysis that warranted further investigation.

c. Staff inquired of a number of experienced local government practitioners who, given that nine out of thirteen city councils have moved to capital value rating, were not aware of any evidence to support the claim that a capital value rating would adversely impact investment.

d. Council, subsequent to receiving these submissions, has commissioned Auckland based economists Market Economics to undertake a review (see Attachment 2) including:

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i. Accessing the impact of a change in rating system on operating surplus. ii. Accessing the impact of a change in rating system on investment decisions.

e. The finding are that the shift to capital value will affect different properties and parties in different ways. The change provides positive operating impacts to manufacturing and wholesale, and negative impacts to more capital property intensive sectors including retail and hospitality. The report notes the transition proposal provides sufficient time for owners to introduce and implement changes.

f. The finding with respect to property investment were that a change to capital value does not appear to have a material impact on investment decisions.

g. Many submitters on this topic translated total project costs into very high future rates. Much of this analysis is flawed in that it takes no account of other growth in the sector and rating valuations in the commercial sector are aligned with averaged rentals, which usually results in much lower rating valuations than project costs and thus lower rates than the submitters calculated.

h. In conclusion, based on the findings of the economic analysis, it is staff’s view that a change to capital value rating will not have a significant impact on commercial investment decisions.

44. Some commercial submitters advised that the allocation of 34% of the general rate to the commercial sector was unfair and did not reflect the benefit received.

a. Council rates have been set based on the policies adopted in previous 10-Year Plan 2012/22. These policies were drawn from the Funding Needs Analysis 2012/22, which considered the appropriate sources of funds for each activity.

b. The rating system is not a user pays system. Benefit is only one matter that Council should consider when deciding on the appropriate allocation of differentials between sectors.

c. In addition, it is not necessary, nor required, that Council undertakes a first principles review of the Revenue and Financing Policy. “The Council was not required to adopt a clean slate approach. It was entitled to have regard to the starting position, to weigh the impact of changes on the types of properties and, looking to the interests of its ratepayers (its fiduciaries), to consider the acceptability to ratepayers of change and sudden change in response to quite extraordinary changes in capital values.” Woolworths v. Wellington City.

d. Council did consider the possibility of a redistribution of rates between sectors. An option Council analysed was to remove all differentiations; this had the effect of reducing rates for the commercial sector transferring $18m to the rural and residential sectors. In 2012 Council received strong feedback from submitters (mostly residential ratepayers) that a no differential option was inappropriate due to this transfer of cost. Having regard to the weight of the impact this change had on the residential sector Council sought to develop a rating proposal that the community accepted as appropriate.

e. In conclusion, staff’s view that the allocation of the rates requirement from each sector, as outlined in the Proposal, remains appropriate.

45. Some submitters operating outside of the CBD advised that they were subsidising the CBD differential and considered this an uneven playing field.

a. The CBD commercial ratepayers (as defined by the BID zone) receive a 5% discount on their general rates. This discount supports Council’s policy to have an active and strong CBD. With the change to capital value the sum of this discount is larger than under land value due to a higher capital value in the CBD.

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b. Council has options to reduce the amount of the discount through to removing the discount, and consequentially the need for the CBD differential. Any change in this direction will increase CBD rates and reduce commercial rates outside the CBD.

c. In conclusion, staff’s view is that Council’s policy intentions are unchanged and the policy to discount the CBD rates should remain at this time.

46. Residential submitters objected to high rates increases and did not see an increase in benefit for these rates.

a. The proposal redistributes the 65% of the total rates that residential ratepayers pay within the residential sector. This results in 50% getting an increase and 50% decreasing.

b. As stated in paragraph 44; Council has completed this analysis appropriately.

c. In conclusion staff’s view is that the increases are in line with property value differences and that nothing has changed from the analysis that Council has previously considered appropriate.

47. Submitters advised that many residents on fixed incomes will be adversely affected by the rates increases.

a. Residences in above average value properties will get an increase, if the proposal is adopted.

b. Should this create hardship Council provides the Government Funded Rates Rebate Scheme and additionally provides its own extension of that policy.

c. In conclusion staff’s view is that should this change in policy create genuine hardship then there are policies in place to assist those individuals.

48. Submitters requested more user pays methods for charging rates.

a. 74 submitters said that rates should be based on usage of services. This was reinforced by verbal submissions.

b. For Council to introduce rates that reflect user charges, such as a targeted refuse rate, it requires a reassessment of the s101(3) analysis for that activity, and subsequent amendment to the Revenue and Financing Policy.

c. In conclusion staff’s view is that it is not appropriate to start this analysis at this time. It is a significant change to how this Council rates and it would be appropriate to fully analyse and consult on such a change.

49. Other Matters

50. While staff have endeavoured to identify the major themes, Council may wish to identify, discuss and seek advice on other matters raised in submissions.

51. Options 52. Council can choose to:

Adopt the proposal (recommended).

Modify the proposal.

Reject the proposal.

53. Adopt the Proposal (recommended)

54. While Council received many well considered submissions, the major matters raised are matters Council had previously considered in its initial analysis. No matters arose through the consultation that prevents Council from adopting the proposal.

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55. The proposal, as outlined on page 2 of the Statement of Proposal is to:

Change the general rate to capital value

Maintain the same amount of rates (yield) from each sector

Reduce the differentials to four (Commercial, CBD Commercial, Residential and Rural)

Introduce a new Remissions Policy for properties where services are unavailable.

Transition the change in general rates over 10-Years.

56. Should Council resolve to implement the proposal staff will need to undertake the technical work to lawfully implement the change on 1 July 2015. This work requires the redrafting the following matters:

Funding Needs Analysis

Revenue and Financing Policy

Rates Remission Policy

Rating Policies

Funding Impact Statement, and

Rates Resolution.

57. The Local Government 2002 Amendment Act 2014 has changed the process leading to setting rates and good practice on how to do this is still being developed. Staff expect that:

Many of the matters will need to be drafted as supporting information to the 10-Year Plan Consultation Document and may need Council support in order to meet audit requirements.

The Revenue and Financing Policy, at a minimum, will require a s.82 consultation, which must be completed, with the adoption of a Revenue and Financing Policy, prior to the adoption of the 10-Year Plan in June 2015.

58. Modify the Proposal

59. Many matters were raised by submitters. Council could consider they merited the proposal being modified at this time.

60. If Council wish to modify the proposal; a resolution instructing staff to undertake specific analysis and modeling would be required at this meeting.

61. Council meets next in December and it may be possible to complete this task within the next few days to meet the agenda deadline, however it is more likely that the next decision making opportunity will be in the New Year.

62. Council must have a clear direction so that the 10-Year Plan Consultation Document can be prepared and audited in February/March 2015.

63. Reject the Proposal

64. Having completed the Rating Review and heard the community views Council could now resolve to reject the proposal and continue with the current land value rating system.

65. The rating review would end and the statutory policies will be confirmed for inclusion into the 10-Year Plan

Signatory Authoriser Richard Briggs, Chief Executive

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SUBMISSION ANALYSIS REPORT

RATING REVIEW POLICY Summary of submissions

This report: This report provides a summary of the main themes and points included in submissions to Council’s proposal to change to a capital value rating system

Submission Period: 8 August – 8 September 2014

Total Submissions: 666

Hearing heard: 42

Hearings dates 29 and 30 September 2014

SUMMARY OF SUBMISSIONS

Do you support or oppose the proposal to change to a capital value rating system?

Of the 666 submission received:

470 submitters (71%) opposed a change from land value rating to capital value rating

190 submitters (28%) supported the change

6 submitters (1%) either didn’t know if they were in support or opposing of the change, or didn’t provide a response to this question

Support a change from land value to capital value rating Of those submitters that supported the change from land value to capital value rating the main reasons were as follows:

SUPPORT CAPITAL VALUE RATING

Topic Number of submissions commenting on this topic

Capital value is a fairer system/as long as the method is fair and equitable

72

Change to capital value is overdue/land value is outdated 11 Capital value better reflects use of services 4 This is the preferred rating system by most Council’s in New Zealand

2

No reason provided 100

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Oppose a change from land value to capital value rating Of those submitters that opposed the change from land value to capital value rating the main reasons were as follows: (a number of submitters provided no reason for why they opposed the change, while others commented on multiple topics).

OPPOSE CAPITAL VALUE RATING


Increases proposed under capital value are not affordable/rates are high enough already/do not want a rating system change that results in a rates increase

102

Rates should be based on usage of services and facilities not property values

74

There is no need to change from the current system/Land value is a better system

57

There are no service includes for the rates increase/ those receiving increases don’t necessarily use more services

43

Capital value is not a fair system/unfairly penalises those who have worked hard

41

Capital value rating will reduce business viability 34 Capital value rating discourage home improvements and/or discourages upkeep of houses

24

Residents disagreed with the proposal to change last time it was consulted on/nothing has changes/why is it being consulted on again

18

Perception that the proposed capital value system will general more revenue

8

Do you support or oppose the proposal to collect the same percentage of rates from each sector? (Residential 65%, Commercial 34%, Rural 1%).


213 submitters (32%) opposed retaining the percentage of rates collected from each sector

213 submitters (32%) supported retaining the percentage of rates collected from each sector

240 submitters (36%) either didn’t know, or didn’t provide a response to this question

Support retention of the current rating sector split

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Of those submitters that supported the retention of the current rating sector split the main reasons were as follows:

SUPPORT RATING SECTOR SPLIT


Current split in rating sectors seems appropriate 21 Other comments 8

Oppose retention of the current rating sector split Of those submitters that opposed the retention of the current rating sector split the main reasons were as follows: (a number of submitters provided no reason for why they opposed the change, while others commented on multiple topics).

OPPOSE RATING SECTOR SPLIT


Commercial sector should pay more 37 Rural sector should pay more 11 Suggestions for different ways to rate rather than using a sector split

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Residential sector should pay less 9 Differentials 8 All sectors should pay the same percentage 7 Commercial increases will be passed on consumers 5 Commercial sector should pay less 2 Other 3

Do you support or oppose the proposal to transition the change to capital value over 10 years?


382 submitters (57%) opposed the proposal to transition the change to capital value over 10 years

165 submitters (25%) supported the proposal to transition the change to capital value over 10 years

119 submitters (18%) either didn’t know, or didn’t provide a response to this question

Support the proposal to transition the change to capital value over 10 years

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Of those submitters that supported the proposal to transition the change to capital value over 10 years the main reasons were as follows:

SUPPORT TRANSITION PERIOD


Transition period should be shorter 28 Transition period is needed 26 Transition period is appropriate 14 Other comments 3

Oppose the proposal to transition the change to capital value over 10 years Of those submitters that opposed the proposal to transition the change to capital value over 10 years the main reasons were as follows: (a number of submitters provided no reason for why they opposed the change, while others commented on multiple topics).

OPPOSE TRANSITION PERIOD


Opposes proposal therefore opposes transition period 65 Transition period should be shorter 41 Transition period isn’t long enough 7 Perception that phasing is being used to disguise the increases

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Other 3

Other Comments Of the 666 submitters, 72 provided additional comments on the proposal to change to capital value rating. The main comments provided were:

OTHER COMMENTS PROVIDED ON THE PROPOSAL


Opposes CBD subsidy/ doesn’t think it will encourage development in the CBD

31

Council should reduce spending to reduce rates 17 Rates should be based on the number of people per property

8

Think a CBD subsidy will encourage development in the CBD 4 The decision should be made via referendum 4 Other comments 8

Type of ratepayer:

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The following table contains a breakdown of the type of ratepayer submitters identified themselves as. These numbers add to more than the total number of submissions received (666) as some submitters owned multiple types of properties.

TYPE OF RATEPAYER

Sector Total Support change

to CV rating Oppose change

to CV rating Don’t know

Residential ratepayers 561 158 399 4 Commercial ratepayers 113 47 66 - Rural ratepayers 9 5 4 - None of the above (e.g. renting, representative body)

16 4 12 -

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Report Name: Asset Analysis - Clarence

Street Theatre Author: Sean Murray

Report Status Open

Strategy, Policy or Plan context Hamilton Arts Agenda, Hamilton City Theatres Review



Having regard to the decision making provisions in the LGA 2002 and Councils Significance Policy, a decision in accordance with the recommendations is not considered to have a high degree of significance

1. Purpose of the Report

2. The purpose of this report is to report back to Council on the outcome of the work of Creative Waikato and recommend an option in respect of the on-going ownership of Clarence Street Theatre.

3. Executive Summary

4. A review of Hamilton theatres was commissioned in 2012 in response to under-utilisation of Council theatres, ongoing maintenance costs, the aging state of the theatres and a proposal within Council’s 2012-22 10-Year Plan to consider the sale of Clarence Street Theatre to help reduce city debt.

5. At the 28 August 2014 meeting Council instructed the Chief Executive to work with Creative Waikato to explore the possible sale of the Clarence Street Theatre to the current users of the site and report back to Council on the matter.

6. Creative Waikato has prepared a proposal to Council on behalf of its users. The proposal effectively seeks the gift of the theatre to a newly formed “Trust” plus a grant/loan of $150,000 in the first year.

7. The sale of Clarence Street on the open market would have a positive cash impact (using a 5 year average) of $351,000 per annum; based on a sales price of $1.5m. It is noted that due to unique nature of the theatre it would take 6 to 12 months to sell.

8. Clarence Street could be used, to a limited extent, as theatre cover should the Founders Theatre upgrade be approved within the 10 Year Plan.

9. Recommendations from Management

a) That the report be received.

b) That Council continues to own and operate the Clarence Street Theatre (status quo) until such time as Founders Theatre upgrade is completed.

c) That Management are instructed to develop a revised operating model to will increase “community group” utilisation of the Clarence Street Theatre and reduce the capital

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renewals budget as a part of that new operating model; and report back accordingly to Council on the introduction and outcomes of a new operating model.

d) That once the Founders Theatre upgrade is complete a report on the possible sale of Clarence Street is updated and presented to Council for consideration.

10. Attachments

11. Attachment 1 - Creative Waikato Proposal - Clarence Street Theatre 12. Attachment 2 - Clarence Street Asset Analysis

13. Background

14. A review of Hamilton theatres was commissioned in 2012 in response to under-utilisation of Council theatres, ongoing maintenance costs, the aging state of the theatres and a proposal within Council’s 2012-22 10-Year Plan to consider the sale of Clarence Street Theatre to help reduce city debt.

15. Following research and extensive consultation with the arts community, the Theatres Review report (link) was prepared by The Stafford Group and presented to Council in February 2013. The review highlighted a major challenge for Council being the lack of utilisation across a portfolio of three under-performing theatres, the need to rationalise the portfolio in order to consolidate both revenue and cost streams and exit where it can from the liability of notable capital costs of assets renewals in the near term.

16. Community feedback during the review process and following its completion was dominated by a concern over the possibility of Hamilton losing the Clarence Street Theatre through a private sale and there was particularly strong advocacy that Council should protect the tenure of the Hamilton Operatic Society who is the dominant user of the theatre.

17. The review also pointed to the need for significant repair and refurbishment of the Founders Theatre being Hamilton’s flagship and most utilised (attended) theatre. This is the subject of a separate consideration within Council’s 10-Year Plan

18. Options for the Clarence Street Theatre

19. Sale of property

20. One of the recommendations of the Theatres Review was to sell Clarence Street Theatre. Discussions have taken place with stakeholders and there is the potential opportunity for a sympathetic buyer to purchase the asset however that has yet to be tested. However it should be noted that under a proposal put to Council by Creative Waikato (see attachment one) the option of a sympathetic buyer has not been considered.

21. The market for the theatre itself is difficult to establish dependant on its ultimate use.. The net proceeds of sale could be deployed to directly offset Council debt. Given the unique nature of the property it could take 6-12 months if not more to sell.

22. Although it is of no bearing on the current market valuation Council’s acquisition of the Clarence Street Theatre in 1997 was at a cost of $1.17 million as a part of an accommodation to assist the Hamilton Operatic Society whom at the time was in financial difficulty. If a new theatre were to be built of similar size to The Clarence Street Theatre the cost would be in the $14-$16 million range minimum.

23. Should the theatre be sold there could potentially be some considerable disruption for existing users (namely Hamilton Operatic Society, Drury Lane Dance Company, Waikato Youth Orchestra and Cantando Choir). In addition to the performance activity the theatre also supplies rehearsal and instruction rooms and costume/props storage which would place additional pressure on the current users. Whilst the existing lease terms provide for a minimal

http://www.hamilton.govt.nz/our-city/facilities/hamiltontheatres/Documents/Hamilton%20City%20Theatre%20Review%20-%20report.pdf

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3 month notice period for the termination of occupancy realistically any notice should be on a six months maximum basis.

24. One consideration in selling Clarence Street Theatre is that if a significant upgrade of Founders Theatre is to take place then the city may not have access to any Theatre for up to a year while refurbishment work is undertaken. On this basis it is recommended that as part of a sale the opportunity be investigated to retain the right to utilise Clarence Street Theatre should Founders Theatre be closed for refurbishment.

25. Creative Waikato Proposal – Gift and Operating Grant

26. At Council’s request Creative Waikato have prepared a proposal (attachment one) on the future options for the Clarence Street Theatre on behalf of its users. All options effectively seek the gift of the theatre to a newly formed “Trust” plus a grant/loan of $150,000 in the first year.

27. Creative Waikato’s preferred option is Option 1 being the gift of the theatre to a “Trust” and award of a $150,000 operating grant in the first year. This would have certain delivery conditions attached to it and the option for Council to regain ownership should the activity of the “Trust” fail.

28. Option 2 is a partnership model whereby Council would be a party to the “Trust” Board and effectively tied to the operating organisation.

29. Option 3 is the more tenable option for Council as it is essentially Option One but with the inclusion of community outcome targets (that could include financial viability) which if unachieved could trigger a return of the theatre into full Council ownership at any time.

30. Status Quo – Retention of Clarence Street Theatre by Council

31. A further option is that Council retains the Clarence Street Theatre on an as is basis and continues to operate it through Council’s H3 operation. Should a refurbishment of the Founders Theatre proceed in 2016/17 it will provide some cover for theatrical performance to continue in the city during the refurbishment and remove any disruption to existing users.

32. However a status quo option would have to consider feedback from the 2013 Theatres Review and management should be tasked to work with the performing arts community to determine a better operating model that will encourage greater use of the facility by community performance groups.

33. Equally management will review the nature of the facilities at the theatre which is likely to lead to a restriction of some of the technical capabilities of the performance areas and therefore renewals costs. This is to ensure it does not cannibalise the opportunity for greater utilisation and revenues at Founders Theatre.

34. Impacts on the exit of the Clarence Street Theatre ownership and operation by Council

35. The theatre currently resides within Council’s H3 (venues) operation which includes the Founders Theatre. The total number of dedicated theatres staff is four (across the two theatres) with all other staff requirements either shared across all of the other venues (for example business development, administration etc.) or delivered through a variable cost model where the user (client) pays. Much of the theatres equipment is shared across the venues including Claudelands Event Centre.

36. The second attachment to this paper outlines the budgeted OPEX (excluding Council overhead depreciation charges) and CAPEX position for the next five years. The theatre costs Council a little over $100k per year to operate and has variable capital expenditure requirements dependant on asset renewals schedules.

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37. Fiscal implications on options presented (based on a five year average):

38. Sale of Property

39. The net positive impact on annual budget of an open market sale of the property is estimated at an immediate positive gain over current position of $351,800 per annum.

Reduction of Council debt $1,525,000 (less any costs of sale est. $50,000) Reduction of Council loan repayment $ 84,800 p.a. Reduced OPEX $ 114,000 p.a. Reduced CAPEX $ 153,000 p.a. Net positive impact on annual budget $ 351,800 p.a.

40. Gift and Operating Grant

41. The net positive impact on annual budget of gifting the theatre and providing a $150,000 per annum operating grant is an immediate gain over current position of $117,000 in year one and an immediate gain over current position of $267,000 per annum in years 2 and onwards.

42. Status Quo

43. No change to budget. (Alternative operating model - yet to be determined - likely to reduce revenue and expenditure but with a similar net result; likely CAPEX savings in year 3 and beyond.

Signatory Authoriser Sean Murray, General Manager Events and Economic Development Group

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Report Name: Housing for Older Persons

(Pensioner Housing) Review - Deliberations and Decision-Making

Author: Elton Parata

Report Status

Open

Strategy, Policy or Plan context 10 Year Plan, Housing for Older Persons Policy (Pensioner Housing)



Having regard to the decision making provisions in the LGA 2002 and Councils Significance Policy, a decision in accordance with the recommendations is considered to have a high degree of significance

1. Purpose of the Report

2. The purpose of this report is to present the decision options available to the Council in relation to the Housing for Older Persons (Pensioner Housing Review) following the Statement of Proposal formal public consultation process.

3. Executive Summary

4. At the 25 September 2014 Ordinary Council meeting Council adopted a Statement of Proposal for Housing for Older Persons (Pensioner Housing) Review for consultation.

5. Submissions were open from 29 September to 31 October 2014. In total, 284 submissions were received with 45 submitters requesting to speak at the hearing.

6. Council received a number of well prepared and presented submissions. A key theme of these submissions is that residents of pensioner housing wanted their ongoing tenancy protected and that the community wanted to ensure that there was not a reduction in the overall level of social housing in Hamilton. As a result of these submissions, a change to the original proposal is recommended.

7. The key changes recommended are that pensioner housing should not be sold on the open market. The pensioner housing portfolio should only be offered for sale to social housing providers and only with a number of conditions attached. This differs from the original proposal and instead reflects option 4B in the Statement of Proposal document.

8. The conditions of sale proposed are to ensure:

That all existing tenants can remain within the pensioner housing portfolio providing all current tenancy obligations are met, meaning no existing tenant will be left without a home as a result of any sale

council report

http://www.hamilton.govt.nz/AgendasAndMinutes/Council%20Agenda%20-%20Open%20-%2025%20Sept%202014.pdf

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That the pensioner housing properties be used solely for social housing purposes for at least 10 years after any sale; they cannot be used as private rentals or on-sold on the open market.

That the overall number of social housing units is maintained so that there is no decrease in the amount of units available for social housing in the city.

9. This recommendation recognises that social housing providers are better positioned and better able than council to offer, and potentially grow, a more comprehensive social housing service which caters specifically for vulnerable people in the city.

10. Recommendation/s from Management

a) That the report be received.

b) That Council resolve to sell the pensioner housing portfolio to social housing providers only (reflecting Option 4B in the Statement of Proposal) but only under the following conditions:

i) That all existing tenants can remain within the pensioner housing portfolio providing all current tenancy obligations are met, meaning no existing tenant will be left without a home as a result of any sale.

ii) That the pensioner housing properties be used solely for social housing purposes for at least 10 years after any sale; they cannot be used as private rentals or on-sold on the open market.

iii) That the overall number of social housing units is maintained so that there is no decrease in the amount of units available for social housing in the city.

c) That the Chief Executive be delegated to undertake a Request for Expressions of Interest (REOI) process for the sale of Council’s pensioner housing with the results of the REOI to be reported back to Council for a final decision on any offers received.

d) Prior to commencing the REOI sale process, the Chief Executive approve the criteria and framework for evaluating all social housing providers who participate in the REOI, including non-accredited social housing providers.

e) That the REOI sale process will be for a period of 6 months commencing 23 February 2015.

f) That any pensioner housing properties that remain unsold at the end of the REOI process be reported back to Council for further direction

11. Attachments

12. Attachment 1 - Financial assessment (current costs of the pensioner housing service and potential outcome of sale).

13 Attachment 2 – Submission Analysis Report

14. Background

15. Council released a Housing for Older Persons (Pensioner Housing) Discussion Paper in March 2014. The Discussion Paper provided information about the changes made to the way social housing is delivered in New Zealand and the challenges facing the Council owned pensioner housing service.

http://www.hamilton.govt.nz/AgendasAndMinutes/Extraordinary%20Council%20Agenda%20-%20Open%20-%204%20March%202014%20(Part%201).pdf

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16. Council resolved on 27 March 2014 that a Social Housing Working Group develop an Options Paper which identifies a range of alternative service delivery options, including sale, for the Council’s Housing for Older Persons (Pensioner Housing) activity.

17. The Social Housing Working Group met with the social housing sector in developing the Options Paper and changes were made as result of the meeting.

18. On 22 August 2014 the Social Housing Working Group briefed the housing tenants on the Options Paper and recommendation to Council.

19. The Options Paper, including the preferred option, was formally adopted by Council on 28 August 2014.

20. At its meeting 25 September 2014 Council adopted a Statement of Proposal for Housing for Older Persons (Pensioner Housing) Review for consultation.

21. The proposal as outlined in the Statement of Proposal was to

Invite social housing providers to buy Councils pensioner housing portfolio for ongoing use as social housing.

If not sold within 6 months, offer the pensioner housing for sale on the open market.

Pensioner housing would no longer be provided as a council service.

22. This option was accepted because:

It best addressed the issues outlined in the options paper.

By providing social housing providers the first preference to acquire Councils housing assets, it recognised that social housing is an important issue in the city.

There are other social housing entities that are in a better position than Council to provide pensioner housing.

23. Submissions were open from 29 September to 31 October 2014. A total of 284 submissions were received.

24. Hearings of submissions were held by Extraordinary Council on 12 November 2014.

25. Key matters raised in submissions and hearings

26. Many matters were raised by submitters both for and against the proposal. While the majority of the submissions (94%) opposed the proposal, a key theme of these submissions (and borne out within the hearings) is that residents of pensioner housing wanted their ongoing tenancy protected and that the community wanted to ensure that there was not a reduction in the overall level of social housing in Hamilton.

27. Staff have identified the key matters that were raised by submitters in support of the proposal

Pensioner housing is not council’s core responsibility.

A sale to social housing providers ensures the continuity of service and social housing providers have the benefit of accessing central government funding.

The sale of those properties would provide funds to address the city debt.

28. These views were mirrored in the verbal presentations. Additional matters raised in the hearings were:

That Council cannot address the future demand for pensioner housing, therefore it should not be in this business.

Acknowledgement of the benefits of only selling to social housing providers.

http://www.hamilton.govt.nz/AgendasAndMinutes/Ordinary%20Council%20Agenda%20-%20Open%20-%2028%20August%202014.pdf

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29. Staff have identified the key themes that were raised by submitters against the proposal

Pensioner housing should remain a Council responsibility/Council has a social responsibility for the well being of the city’s elderly.

Concern about the security of homes for current tenants

Concerns about the potential loss of social housing resulting from a sale on the open market

30. These views were also mirrored in the verbal presentations. Additional matters raised in the hearings were:

The recommendation that Council, if it was going to sell, only sell to social housing providers to ensure public accountability. None of the social housing providers supported sale of the pensioner housing on the open market because this would not be in the best interests of tenants and might result in a significant loss of social housing in the city.

The need for conditions and constraints to ensure the long term ownership of properties and ensure that existing tenants can remain within the portfolio.

Social housing providers raised concerns around the proposed six month sale process timeframe. They suggested a period longer than six months was required to undertake due diligence and potentially raise the required funds for purchase.

The Christchurch Social Housing Proposal was identified as a potential model Hamilton should consider. It was perceived to allow for flexibility in future ownership, management and development of the social housing portfolio.

Social housing providers and social service organisations also suggested that Council should work with social housing providers to formulate a plan to address the issue of social housing at a city level. They requested that Council slow the process down to allow for this collaboration to occur.

They also requested that Council retain the properties and work with social housing providers to grow the portfolio. This was frequently referred to as a “both/and” situation rather than an “either/or”. This resulted from concern over the current shortage of social housing nationwide and reflected in Hamilton and the need to address the shortage.

Interest in the potential sale

31. A number of social housing providers submitted, with four expressing an interest in partnering with Council or purchasing the properties. They were:

Habitat for Humanity

Ryder Cheshire Foundation (Waikato)

Accessible Properties New Zealand Ltd (Accessible Properties)

Eastside Apostolic Foundation

32. Expressions of interest were also received from other organisations outside of the submission process directly to Council staff, expressing an interest in partnering with Council or purchasing the properties.

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33. Analysis of key matters raised in submissions and hearings

Pensioner housing is not council’s core responsibility.

A sale to social housing providers ensures the continuity of service asnd social housing providers have the benefit of accessing central government funding.

Pensioner housing should remain a Council responsibility/Council has a social responsibility for the well being of the city’s elderly.

34. The new purpose of the local government set out in the Local Government Act 2002 (LGA 02) allows for Council to provide a pensioner housing service. S10(2)(a)(b) focuses on the need for it to be delivered efficiently and effectively.

35. While Council has provided the pensioner housing service successfully for a long period of time, there are a number of benefits with social housing providers offering the service. These include proven track record of operating social housing in the city, a strong sense of social responsibility, and their expressed long term commitment to this service. In particular, those that choose to become accredited providers through the government’s accreditation process have a high level of public accountability.

36. Council is currently not able to access government capital and income related rent subsidy (IRRS) funding and therefore will not be able to deliver services in the future as efficiently or effectively as accredited social housing providers.

37. The Options Paper and Statement of Proposal recognise that with access to this funding, unlike the council or private landlords, accredited social housing providers are in a stronger position to grow social housing in the city. This is seen as important.

38. In response to the issues raised in submissions, and noting the issue of government incentives that put social housing providers in a better position than Council to provide pensioner housing, it is proposed that the pensioner housing portfolio should be offered for sale.

The sale of those properties would provide funds to address the city debt.

39. Should Council sell the pensioner housing it would be able to reduce its overall debt. A decision to sell would help council achieve its overall financial strategy targets

Sell only to social housing providers

40. The benefits of social housing providers offering the service are outlined above. Selling on the open market would not be in the best interests of tenants and might result in a significant loss of social housing in the city.

41. In response to the issues raised in submissions, and noting the issue of government incentives, it is proposed that the pensioner housing portfolio should be offered for sale only to social housing providers. There should be no sale on the open market.

Pensioner housing residents ongoing tenancy protected (security of tenancy)

42. A number of submitters expressed their concerns about the potential displacement of current tenants if any property was sold on the open market and noted the health impacts and stress of this uncertainty.

43. Through the hearing process, Council asked whether submitters would support sale to a social housing provider if there were guarantees that current tenants would not be displaced. Most submitters said that they would be satisfied and if that change was made, would support the proposal in principal.

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44. In response to the issues raised in submissions, it is proposed that conditions be attached to any sale to protect the ongoing tenure of current tenants and ensure the properties remain in social housing for a period of at least 10 years after the sale.

Concerns about the potential loss of social housing resulting from a sale on the open market

45. Statistics support that Hamilton has an ageing population. The current level of social housing in Hamilton will not meet future demands. It is acknowledged that, if properties were to be sold on the open market, they would be lost to the sector and that this would contribute to an ongoing shortage of social housing in the city.

46. Through the government housing reforms, the social housing sector – unlike council - can access government funding. Social housing providers who made submissions were confident that they could provide the necessary services and that they were in the position to grow the portfolio of social housing in the city.

47. In response to the issues raised in submissions, it is proposed that any purchaser(s) must maintain the overall number of social housing units so that there is no decrease in the amount of units available for social housing in the city.

Sell only to social housing providers

48. The benefits of social housing providers offering the service are outlined above. Selling on the open market would not be in the best interests of tenants and might result in a significant loss of social housing in the city.

49. In response to the issues raised in submissions, and noting the issue of government incentives, it is proposed that the pensioner housing portfolio should be offered for sale only to social housing providers. There should be no sale on the open market.

Concerns around the proposed six month sale process

50 The social housing sector requested greater time be allowed in the sale process and that the proposed six month sale process timeframe be extended.

51 In response to the issues raised in submissions, it is recommended that Council delay beginning the REOI sale process until 23 February 2015. This later start time will provide applicants an additional three months to prepare.

Christchurch Social Housing Proposal

52 The Christchurch Social Housing Proposal involves creating a separate entity, formed between the Council and other organisations interested in providing social housing in Christchurch, to manage its social housing portfolio.

53 Although the legislation allows a subsidiary of a local authority to apply to be accredited (it must be operating at arms length and genuinely independent from the council), the process for the accreditation of a Council-Controlled Organisation (CCO) is untested. There is no guarantee accreditation will be gained.

54 In addition to this, it is understood there are some unresolved challenges around the establishment of the proposed CCO, in particular relating to the specific structures and commercial arrangements to give effect to the intent of their proposal.

55 In response to the issues raised in submissions, it is proposed that there is currently too much uncertainty for a housing model similar to that in Christchurch to be recommended.

Social Housing Plan

56 Identifying a process for the development of a social housing plan for Hamilton is a vital piece of work that Council has already identified is yet to be completed. The Social Housing Working

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Group will address this as part of future meetings and will invite social housing providers to be involved in this process.

57 Recommended Option

58 The proposal adopted by Council for consultation was to invite social housing providers to purchase Councils pensioner housing for ongoing use as social housing. If not sold after six months, Council would offer the properties for sale on the open market. This is reflected as option 4C in the Statement of Proposal.

59 After having considered and analysed the submissions as outlined above, staff recommend to Council that pensioner housing should not be sold on the open market. The pensioner housing portfolio should only be offered for sale to social housing providers and only with the following conditions attached:

That all existing tenants can remain within the pensioner housing portfolio providing all current tenancy obligations are met, meaning no existing tenant will be left without a home as a result of any sale.

That the pensioner housing properties be used solely for social housing purposes for at least 10 years after any sale; they cannot be used as private rentals or on-sold on the open market.

That the overall number of social housing units is maintained so that there is no decrease in the amount of units available for social housing in the city.

60 The recommendation, which reflects option 4B in the Statement of Proposal document, has been discussed with the Social Housing Working Group. The recommendation still addresses the issues for Council in delivering pensioner housing services outlined in the Options Paper and Statement of Proposal but better reflects and takes into account the key issues and concerns raised during the submission process.

61 It should be noted that by introducing conditions to the sale of the pensioner housing portfolio, a sale value less than the full market value of the properties is likely to eventuate.

62 Other options

63 The Statement of Proposal identified a range of options including continuing with the status quo, contracting out the service, selling just some of the properties, selling all the properties on the open market and selling all of the properties to social housing providers only (recommended).

64 The recommended option (to sell to social housing providers only) recognises that social housing providers are better positioned and better able than council to grow the provision of social housing in the city.

65 While there was most support for the status quo (233 submitters), this option does not recognise that Council is currently unable to access government capital and income-related rent subsidy (IRRS) funding and is therefore very constrained in terms of enhancing the service or growing the portfolio to meet increasing demand.

66 For many of these submitters, the key concern was the risk of elderly tenants losing their accommodation and having nowhere affordable or suitable to go as a result of a sale on the open market.

67 The recommendation addresses this concern with the sale to social housing providers only (not on the open market) and with a set of conditions including the requirement that all existing tenants can remain within the pensioner housing portfolio providing all current tenancy obligations are met. This will mean no existing tenant will be left without a home as a result of any sale.

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68 Implementation considerations

69 The REOI process will be led by the Strategic Property Unit and supported by a cross-council team from the Community Development, Property and Communications Unit.

70 Regular communications with current tenants to keep them informed and reassured will be a top priority for the team.

71 Financial Implications

72 The Options Paper presented to Council on 28 August 2014 outlined the financial considerations of operating the pensioner housing activity. These are included again in Attachment 1.

73 The potential financial outcomes from the proposed sale of pensioner housing to social housing providers is also detailed in Attachment 1. This outlines the different levels of sale proceeds (and discount) for illustrative purposes only. The actual net sale proceeds will not be known until the completion of the REOI sale process. The net sale proceeds will be applied to debt.

74 The REOI sale process will be undertaken in-house and any associated selling costs will be met from sale proceeds.

75 Risk

76 Changes to the provision of the pensioner housing activity has widespread public interest.

77 There are possible risk areas related to Council’s deliberations, including:

A lack of stakeholder understanding of the proposal and all of the options considered as well as the implications of all of those options

A lack of understanding about council’s limited ability to access government funding to provide and grow appropriate social housing services (not just pensioner housing services) to meet the needs of the city

78 These risks are being mitigated by a comprehensive communication plan, including a focus on regular communication directly to the tenants, and the Social Housing Working Group oversight of risks.

79 Staff are satisfied that the Council has undertaken a robust decision making process that complies with the Councils obligations under the Local Government Act 2002. The special consultative procedure has been undertaken as required for an amendment to the Long term Plan.

80 The consultation has been appropriate for identifying and understanding the views and preferences of interested and affected persons so as to satisfy the Council’s obligations under section 78 of the Act and the options identified and level of analysis appropriate to satisfy Council’s obligations under section 77.

Signatory Authoriser Blair Bowcott, General Manager Performance Group

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This Report: This report provides a summary of the main themes and points included in submissions to the review of housing for older persons’ public consultation.

Submission Period: 29 September 2014 – 31 October 2014.

Total Submissions: 290 (includes 94 standard ‘no sale’ forms)

Hearing Requests: 45

Hearing Dates: 12 November 2014

SUMMARY OF SUPPORT FOR OPTIONS

The following table outlines the preferred option of the 275 submitters who indicated they did not support the proposal (4C).

*Includes 94 standard ‘no sale’ forms. Note: The number of submissions does not add up to 275 as a number of submitters indicated they supported multiple options. It also includes several submitters who supported the proposal but also saw some merit in other options

POLICY OPTIONS

Number of submissions

Option 1 – Status Quo (continue to provide the service in the same way) 233*

Option 2 – Contract out the service (continue to own properties but lease them and the service to a third sector provider) 16

Option 3 – Retain the service with partial sale of properties (continue to provide the service with changes) 6

Option 4A – Sale on the open market to maximise the financial return to the Council 2

Option 4B – Sale to social housing provider(s) only 24

Option 4C (The proposal) – Invite social housing provider(s)to buy the pensioner housing for ongoing use as social housing. If not sold to social housing providers after 6 months offer for sale on the open market

15

SUBMISSIONS ANALYSIS REPORT

HOUSING FOR OLDER PERSONS (PENSIONER HOUSING) Summary of Submissions


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SUPPORT FOR THE PROPOSAL (OPTION 4C) – KEY REASONS

Of the 15 submitters that supported the proposal, the following were the main reasons given for support.

SUPPORT FOR OTHER OPTIONS (1,2,3, 4A AND 4B) – KEY REASONS

Of the 275 submitters that did not support the proposal, the following were the main reasons given.

INTERESTS FROM SOCIAL HOUSING PROVIDERS

Three social housing providers expressed an interest in purchasing the properties. o Habitat for Humanity supports the proposal to sell to sympathetic housing providers and have

expressed interest in purchasing. (Sub 0072) o If Council were to sell its pensioner housing Ryder Cheshire Foundation (Waikato) wishes to be

considered. (Sub 0086) o Accessible Properties New Zealand Ltd (Accessible Properties), supports in principle the sale to

sympathetic housing providers and have expressed interest in purchase of part or all of HCC pensioner housing portfolio. (Sub 0275)

Other key social housing providers that submitted. o The Crosslight Trust were concerned about Council’s proposal to sell the pensioner housing and

suggests that Council explore an alternative approach to increase the ‘pool’ of accommodation. (Sub 0146)

o Te Runanga o Kirikiriroa, supports council’s proposal to sell to social housing providers. o St Mathews Conference of St Vincent de Paul Society prefer status quo but would support sale

to sympathetic housing providers provided the current tenants retain their occupancy and that rent reviews are aligned to percentage increase in national superannuation. (Sub 0116)

Summary of 4C

Reasons for support Number of submissions

commenting on the topic

Not Councils role/in line with Government direction/no subsidies 10

General Comments 9

Better service outcomes for tenants 7

Make good financial sense 6

Summary of other options

Reasons for not supporting Number of submissions

commenting on the topic

Need for Council to provide for community/preference of status quo 117

General comments 96

Displacement of elderly tenants 65

Opposition to asset sales (philosophical) 26


Resolution to Exclude the Public

Section 48, Local Government Official Information and Meetings Act 1987

The following motion is submitted for consideration:

That the public be excluded from the following parts of the proceedings of this meeting, namely consideration of the public excluded agenda.

The general subject of each matter to be considered while the public is excluded, the reason for passing this resolution in relation to each matter, and the specific grounds under section 48(1) of the Local Government Official Information and Meetings Act 1987 for the passing of this resolution follows.

General subject of each matter to be considered

Reasons for passing this resolution in relation to each matter

Ground(s) under section 48(1) for the passing of this resolution

C1. Ordinary Council Minutes - Public Excluded - 30 October 2014

C2. Victoria on the River (VOTR) Site

) Good reason to withhold ) information exists under ) Section 7 Local Government ) Official Information and ) Meetings Act 1987 )

Section 48(1)(a)

This resolution is made in reliance on section 48(1)(a) of the Local Government Official Information and Meetings Act 1987 and the particular interest or interests protected by Section 6 or Section 7 of that Act which would be prejudiced by the holding of the whole or relevant part of the proceedings of the meeting in public, as follows:

Item C1. to protect the privacy of natural persons Section 7 (2) (a) Item C2. to enable Council to carry out commercial

activities without disadvantage Section 7 (2) (h)