Road subsidy cuts hit works budget

Dunedin city councillors have decided not to add any money to the budget for roading and footpath maintenance and repairs, despite warnings from council staff that a reduction in government subsidies will leave the council unable to do all the work it had planned over the next three years.

The New Zealand Transport Agency (NZTA) had given a "clear message" its 2012-2015 subsidies would reduce, transportation operations programme engineer Michael Harrison and transportation operations manager Graeme Hamilton said.

While NZTA had not yet made a final decision, the subsidy reduction already suggested would mean a 6% hole in the council's 2012-13 roading budget, rising to 11% by 2014-15, they said.

The subsidies are used to help pay for a wide range of work including road and footpath maintenance, street lights, traffic signals, remetalling gravel roads, road reseals, sea walls, retaining walls, bridges, kerbs, culverts, minor improvements, new capital projects and emergency repairs.

Mr Harrison and Mr Hamilton presented councillors with three options for the next three years: retain the roading budget at the present level by injecting a further $420,000 per annum into it from council funds, reduce expenditure and service levels by 6%-11% over time to reflect the reduced subsidies, or reduce the council's budget as well to maintain the same ratio of expenditure between the council and NZTA.

Councillors voted to reduce the budget by $420,000 per annum.

The reduction would require staff to look at the work programme to determine where cutting maintenance and service levels would have the least risk to the roading network. The impact next year would largely be visual but would have an impact in following years, Mr Harrison and Mr Hamilton said.

The council was due to renegotiate its roading maintenance contracts next year, council operations general manager Tony Avery said.

"That will be crunch point for us."

Cr Kate Wilson said the news was "more doom and gloom about what the Government won't be able to fund.

"This is the beginning of the same story being told."

By next year the final NZTA decision on subsidies would be known and the council would have had time to work out what new service levels were going to be realistic, she said.


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