A new regional council may be formed for the central South Island. David Bruce looks at the business case for the new authority.
In 1989, the then Labour government carried out a major reform of local body structure in New Zealand, amalgamating councils and setting up regional councils.
That created dissatisfaction in the central South Island, initially in the new Waitaki district (formed from the Oamaru Borough, Waitaki and Waihemo County Councils), which was split between the Canterbury and Otago Regional Councils.
During the past 20 years, that dissatisfaction has spread further north into the central South Island, with growing criticism of the way the Canterbury Regional Council, known as Environment Canterbury (ECan), has carried out its responsibilities.
Now, there is a move by the Waitaki, Waimate, Mackenzie, Timaru and Ashburton District Councils to break away from ECan and form a new regional council.
Changing the structure of regional council governance in the central South Island will not be easy - there is a reluctance to increase the number of local bodies in New Zealand.
But the five district councils, driven by ratepayers dissatisfied with ECan, have taken the first step by commissioning consultants Morrison Low and Associates to conduct a business case study on a new regional council.
Naturally, ECan is not happy at the prospect of losing a chunk of its territory, its chairman Sir Kerry Burke focusing on the cost of a new region to ratepayers.
But it is not the first time. In 1999, the Waitaki District Council, supported by its ratepayers and the Otago Regional Council, tried to get the Otago and Canterbury Regional Councils' boundary shifted further north to put all of the Waitaki district in the Otago region.
The Local Government Commission turned the proposal down, and urged ECan to do better in the Waitaki area.
People in the Waitaki Valley who are in the ECan region have given almost 10 years for that to work.
But the issue came to a head in November last year when, at a public meeting at Waitaki Bridge, the Waitaki, Waimate, Mackenzie and Timaru councils were urged to investigate a central South Island region.
Ashburton, also dissatisfied with ECan, joined the other four.
The Morrison Low report, which cost the five councils more than $50,000, is a study of the functions of a new regional council and its costs.
A central South Island region will cost ratepayers more - the report estimates between a 3% and 7% increase in rates, although it could be more or less because the calculation has a margin of error of plus or minus 10%.
But as Waitaki councillor Struan Munro, who represents the Ahuriri ward, part of the ECan region, said, it was not so much the cost as dissatisfaction with the way ECan had governed the area.
Whether that dissatisfaction is enough to overcome resistance to any extra cost is a decision which will be made by ratepayers.
The Morrison Low report is a "high-level" examination of the functions which would be delivered by a new central South Island regional council, the revenue it would need and the expenditure.
The analysis was based on the ECan budget for 2006-07, as well as forward projections of expenditure.
It estimated an increase in expenditure for the new regional council of $1 million in 2008-09, increasing to $2.6 million by 2010-11, over that of ECan.
If the new regional council had been operating this financial year, total expenditure was estimated to have been $19.65 million.
However, savings would be made through the new regional council sharing resources with the five district councils.
These could include financial systems, mapping, data capture, telephone systems, web maintenance, payroll, rating and resource consents processing.
Based on the functions it would carry out, including administration of a new council, about 90 staff would be needed.
That was estimated to cost about $4.4 million.
The biggest cost would be project and programme costs, estimated at $9.7 million. Operational expenses were estimated at about $2 million and other overheads at $2.5 million.
The new regional council would cost $232 per head of population, compared with $118 for the Otago Regional Council and $193 for Southland.
On a cost per $100,000 of capital valuation, the new regional council would come in at $89, compared with $45 for Otago and $87 for Southland.
The next step, if all four councils agree, is further work, estimated to cost about $100,000, to advance the concept.
Once that was completed, the councils would have to ascertain whether their communities wanted to pursue the idea.
If they did, a number of methods were open to seek approval to form a new regional council.
These range from convincing the Government to introduce special legislation to presenting a case for regional council reorganisation to the Local Government Commission.
A new council could -
• Cover the Ashburton, Timaru, Mackenzie, Waimate districts and part of the Waitaki district.
• Replace the Canterbury Regional Council (Environment Canterbury) in those districts.
• Not affect the Otago Regional Council.
• Cost $17.2 million to $21 million in its first year. Increase regional rates by between 3% and 7% (plus or minus 10%).
• Have its own elected council.
• Provide local governance rather than be Christchurch-dominated.
• Employ 90.5 FTE staff.
• Be responsible for water, land use, biosecurity, coastal, air, land transport, waste, natural hazards and civil defence.
• Share resources with the district councils.
Possible rates increases
Waitaki district:
• Rural property, $1.74 million capital value, $34 increase.
• Rural property, $5.7 million, $133 increase.
• Otematata urban, $103,000, $3 increase.
• Kurow urban, $155,000, $5 increase.
Waimate district:
• Rural property, $2.3 million, $67 increase.
• Waimate urban, $149,000, $4.50.
Mackenzie district:
• Rural property, $2.2 million, $85 increase.
• Rural property, $1.75 million, $47 increase.
• Fairlie urban, $79,000, $3.
• Tekapo urban, $332,000, $10.
• Twizel urban, $150,000, $5.
Timaru district:
• Rural property, $1.56 million, $11 increase.
• Timaru urban, $245,000, $5 increase.
• Geraldine urban, $270,000, $7 increase.
• Pleasant Point urban, $258,000, $7 increase.
Ashburton district:
• Rural property, $2.98 million, $82 increase.
• Ashburton urban, $169,000, $6 increase.
- Note: Rates paid include special and targeted rates.
