The Clutha, Gore, and Central Otago district councils have signed off on forming a Council Controlled Organisation (CCO) to manage water, wastewater, and stormwater services for their communities.
The move follows extensive analysis showing that a shared, locally governed model remains the most affordable and sustainable path forward - even after Waitaki District Council, a founding SWDW partner, opted out earlier this year.
The partnership was confirmed earlier this month around the same time the Waitaki District Council was getting a dressing-down from the secretary for local government Paul James, who said in a letter the WDC will face significant barriers to achieving financial stability under a standalone model.
Independent modelling by Morrison Low Advisory shows the new entity of the three councils could save ratepayers across the three districts a combined $392 million by 2054. The joint CCO will be the largest of its kind in the South Island, servicing 59,000 people and managing 23,814 water connections, 3161km of pipeline, 24 urban supplies and 10 rural schemes.
Central Otago Mayor and SWDW chairwoman Tamah Alley said the initiative protected local control while improving efficiency and would secure affordable, reliable water infrastructure for today and for generations to come.
"The model is regionally focused and community-driven. It ensures decisions about water services stay in local hands," she said.
The new entity will assume all existing water-related debt and take over responsibility for setting budgets, planning capital works, and determining charges.
One key principle is local pricing: no community will pay more for the same level of service and investment than they would under their current in-house arrangements.
Mrs Alley said each council would hold an equal share and equal voting power, with governance conducted via a shareholders’ committee. This body would oversee board appointments and set strategic expectations for the new organisation.
The decision comes ahead of a September 3 deadline for councils to submit compliant Water Services Delivery Plans to the Department of Internal Affairs, as required under the Government’s Local Water Done Well legislation.
Mrs Alley emphasised the new model’s scalability and its potential to welcome other councils.
"We remain committed to collaboration and would welcome future conversations with any council interested in being part of a community-led, regional solution," she said.
A suite of expert reports - commissioned from Morrison Low, the Department of Internal Affairs, Infometrics, and Concept Consulting - supported the viability, governance model, and financial sustainability of the three-council CCO.
The new water services entity is scheduled to begin operations by July 1 2027.
— Allied Media
