A new, cheaper roading maintenance contract has brought a windfall for Waitaki ratepayers, although its district council's own company has lost major income.
The new contract, awarded to Southland-based SouthRoads for $9.3 million over three years, was less than the Waitaki District Council had budgeted for and has been estimated to save ratepayers about $250,000 in the coming year.
That is equivalent to about 1% of the projected 7.4% average rate rise for the 2012-13 year.
Based on the previous year's contract, it will save ratepayers a total of $430,000 over the three years, the other saving of $550,000 going to the New Zealand Transport Agency through a reduced subsidy.
A report for the council's meeting tomorrow by its assets group manager, Neil Jorgensen, provides an "interim assessment" of the expected savings from the reduced cost of road maintenance over the next three years.
Mr Jorgensen estimated that at $250,000 next financial year, $130,000 in 2013-14 and $50,000 in 2014-15.
That was expected to substantially benefit rural ratepayers, who paid the largest proportion of the roading rate which is based on capital value.
The council will make a fi-nal decision on what to do with the savings after receiving public submissions later this week and then consider those submissions towards the end of the month.
Since 1991, the council-owned Whitestone Contracting Ltd, which has about 150 full-time-equivalent employees, had won the road maintenance contract, but missed out this time around.
The contract was a substantial part of the company's $21 million annual turnover.
