Agenda of Finance Committee

Finance Committee - 01 May 2018 - Open Agenda Item 1

Agenda Items

1. Water Supply Update

Type of Report:	Operational
Legal Reference:	N/A
Document ID:	465890
Reporting Officer/s & Unit:	Chris Dolley, Manager Asset Strategy

1.1 Purpose of Report

To provide an update to Council on:

- Program of work to improve security of source.

- Progress of the Water Safety Plan Improvement Plan.

Officer’s Recommendation

The Finance Committee:

a. Note that

· Substantial progress has been made in addressing the condition of the bore headworks.

· Progress has been made with the Water Safety Plan Improvement Plan.

· Chlorination will continue for the Napier water supply.

Chairperson’s Recommendation

That the Council resolve that the officer’s recommendation be adopted.

1.2 Background Summary

Security of Headworks

A gap analysis between the condition of the water supply headworks and the New Zealand Drinking Water Standard (NZDWS) was undertaken in July 2017. Since that time we have been working on each of the bore to meet the NZDWS.

In order for the water supply to meet the NZDWS this must be verified by an independent assessor and a report submitted to the Drinking Water Assessor (DWA). Although Napier City Council no longer relies on the “secure bore status” as the sole barrier from pathogens for the water supply we are continuing this work to meet the NZDWS and provide for an additional barrier to contamination.

The physical work to the bore headworks is now complete. Work is continuing on assessing the condition of each bore casing, providing additional protection from nearby waste water assets and verifying aquifer characteristics.

Water Safety Plan- Improvement Plan

Our Water Safety Plan contains an Improvement Plan to address risks determined through the assessment of the water supply. We are required to deliver this improvement plan to comply with the NZDWS. This is a live document that is maintained to reflect current knowledge.

Ongoing Management of the Napier Water Supply and Water Quality Improvement Program

As advised in the 20th December 2017 Update report to Council, Napier’s water supply will continue to be treated through chlorination as a result of adopting the early and urgent recommendations of the Havelock North Inquiry Stage 2. In addition, Napier City Council has received letters from the Director General Health and the Chief Executive Hawkes Bay District Health Board encouraging Napier to adopt the recommendations of the Inquiry.

A program of work has been created to provide for permanent water treatment facilities and improvements to water quality in the distribution network, with this work identified in the Long Term Plan (LTP).

1.3 Issues

De-Chlorinated Drinking Water Taps

The provision of de-chlorinated drinking water taps located around Napier is being consulted on through the LTP process.

1.4 Significance and Engagement

The provision of de-chlorinated drinking water taps are being consulted on as part of the LTP. In addition, the LTP identifies the work to be undertaken as part of the part of Water Safety Improvement Plan.

1.5 Implications

Financial

This work is funded from existing budget (17/18) and proposed LTP budget.

Social & Policy

N/A

Risk

Failure to meet New Zealand Drinking Water Standards will mean that our water supply may be deemed non-compliant by the Drinking Water Assessor and may lead to prosecution.

Failure to adopt the Havelock North Inquiry Stage 2 Early and Urgent recommendation may lead to being directed to adopt the recommendations.

Failure to complete the outstanding work in relation to the Headworks Gap to NZDWS will mean that secure bore status cannot be recognised as a barrier. It is possible that this will lead to non-compliance for the provision of a barrier to Protozoa contamination. The protozoa risk associated with groundwater is very low. Protozoa risk is treated for via UV treatment which may be included in the permanent treatment plant. We are working through this issue with the Drinking Water Assessor.

1.6 Conclusion

Summary of Bore Headworks Gap to NZDWS

All physical work for improving the bore headworks has been completed and assessed by the independent assessor and the Drinking Water Assessor as fit for purpose. T4 (located adjacent to a waste water pump station) has been physically and electrically isolated from the water supply.

The outstanding work is:

- CCTV of each bore column to assess bore column condition

- Maintaining positive artesian pressure for T1 and T5 (Bore pressure SCADA lockout)

- Assessment of aquifer conditions for T2, T5 and T7

- Addressing close proximity of waste water infrastructure from T1, T5 and T7

This work is scheduled to be complete by July 2018 and summarised in the Table below:

Bore Site	CCTV, Cleaning & Developing	Bore Casing Pressure Test	Bore Pressure Scada Lockout	Relining of Wastewater Main	Assessment of Aquifer Confining Layer
T1	Due to a water quality issue this bore is isolated from supply and is only available to supply in outstanding emergency situations.
T2	Completed	Completed	Not Required	Not Required	Scheduled May 2018
T3	Scheduled May 2018	Scheduled May 2018	Scheduled /May 2018	Not Required	Not Required
T4	Due to the bore location within 5m of an NCC Main Wastewater Pump Station this bore is isolated from supply and is only available to supply in emergency situations.
T5	Scheduled July 2018	Scheduled July 2018	Scheduled May 2018	Scheduled June 2018	Scheduled May 2018
T6	Schedule May 2018	Not Required	Not Required	Not Required	Not Required
T7	Completed	Completed	Scheduled May 2018	Scheduled May 2018	Scheduled May 2018
C1	Scheduled May 2018	Scheduled May 2018	Scheduled May 2018	Not Required	Not Required
A1	Not Required	Not Required	Not Required	Not Required	Not Required

Summary of Water Safety Improvement Plan

The current Improvement Plan is an ambitious plan with 28 areas of improvements that address a number of legacy issues. The plan has recently been updated in consultation with the Drinking Water Assessor to reflect the ongoing development of the Water Safety Plan and improved knowledge around our risks.

Current state is as follows:

- 14 items are complete or transitioned to ongoing business as usual

- five items are on track for completion

- seven items have been rescheduled in the new Water Safety Plan- Improvement Plan currently being assessed by the Drinking Water Assessor

- two items have been removed from the plan.

This represents good progress since the last report in Dec 2017 with an additional three items being completed and the nine items behind schedule being rescheduled in consultation with the Drinking Water Assessor. The reasons for items being rescheduled fall into 3 categories:

- improved understanding of scope

- availability of budget

- availability of resources

A copy of the plan is shown at Attachment A.

Summary of Water Quality Improvement Program

The first step of our water quality program is to provide for automation and alarms on our current fleet of manual chlorinators. This work is currently underway.

We have also introduced a Critical Control Point as an additional barrier for our water supply. Our interim critical control is monitoring of turbidity or clarity of the source water. Should the source water clarity shift outside a predetermined level then the water source (single bore) will be shut down as a precautionary measure and cause investigated.

The draft LTP contains a comprehensive $9.6m program to provide for a permanent water treatment plant and network improvements to minimise water quality risk as follows:

- Replace four existing below ground bores.

- Consolidate treatment from 10 incident class to two permanent treatment plants.

- Install dedicated trunk main from bores to reservoirs.

- Install dedicated inlet and outlets to reservoirs replacing common inlet/outlets.

1.7 Attachments

a Water Safety Improvement Plan (Under Separate Cover) ⇨

Finance Committee - 01 May 2018 - Open Agenda Item 3

3. Grant Applications for External Funding

Type of Report:	Operational
Legal Reference:	N/A
Document ID:	460290
Reporting Officer/s & Unit:	Belinda McLeod, Community Funding Advisor

3.1 Purpose of Report

a) To seek approval to apply for external funding to support three projects:

· New Year’s Eve event for 2018-2019.

· Napier Positive Ageing Strategy.

· Rangatahi Summit.

Officer’s Recommendation

That Council

a. Approve the applications being made to external funding providers for grants for the following projects:

· Napier City Council New Year’s Eve event 2018/19

· Positive Ageing Strategy

· Rangatahi Summit

Chairperson’s Recommendation

That the Council resolve that the officer’s recommendation be adopted.

3.2 Background Summary

a) New Year’s Eve event - this event was initiated in its current form in 2000 by the Millennium Committee. The event is held at the Soundshell each New Year’s Eve. PM Management gave notice that 2017 would be their last event. Beth Elstone, of ‘Little Stone’ worked alongside Peter for the 2017 event and has been contracted to manage the 2018 event. This family event is well attended by a range of people in the community, drawing a crowd of around 23,000 people each year. The event draws a multi-generational crowd and behavioural issues are minimal. This is an alcohol and smoke free event.

b) Positive Ageing Strategy – Council is in the process of developing a Positive Ageing Strategy for Napier. Ministry of Social Development has started a new fund to encourage projects that support older people. The application from Council is to pilot Massey University’s OPERAT tool (Older People’s External Residential Assessment Tool). The tool is used to assess the suitability of residential areas for older people with different physical and cognitive capabilities, by older people.

c) Rangatahi Summit – This project has been initiated by the community strategies team to support Māori Youth development. It will bring together Rangatahi and inspirational Māori leaders under a Te Ao Māori framework.

3.3 Issues

No Issues

3.4 Significance and Consultation

Grant applications do not require consultation as they are an operational procedure.

3.5 Implications

Financial

a) New Year’s Eve event - Council provides $40,000 for the event and seeks external funding for the remainder. In recent year’s due to the decline of funding available from external sources, costs have had to be cut back to enable the event to go ahead. The total cost of the event is between $70,000 and $76,000 each year.

b) Positive Ageing Strategy – We will apply for the full project cost ($11,000). Should the application be declined, the project will not proceed until funding can be identified.

c) Rangatahi Summit – $5,000 for this project has been allocated (from the Community Development funding). The remaining costs $13,800 will be sought from external funders. The project will be scaled back depending on the funding secured.

Social & Policy

All projects contribute to strengthening the community and support council strategies (eg Positive Ageing Strategy and Matariki REDs).

Risk

The main risk is that sufficient funding is not secured for the projects. Projects will be scaled back or withdrawn should this happen.

3.6 Options

The options available to Council are as follows:

a) Do not seek external funding for the projects. This would require Council to fully fund the projects.

b) Scale back the projects with Council funding only. There is external funding available, and should our application be successful, the projects would have greater impact.

c) Seek external funding to contribute to project costs (preferred option)

Table A

Funder	Apply for Funding up to:
Pub Charity	25,000
Eastern & Central Community Trust	15,000
First Sovereign Trust	10,000
North & South Trust	10,000
Infinity Foundation	8,000
Total:	$68,000

Table B

Funder	Apply for Funding up to:
Ministry of Social Development - Community Connects Grant	11,000
Total:	$11,000

Table C

Funder	Apply for Funding up to:
Youthtown	9,550
Ministry of Youth Development	1,700
Anahera o Te Rangi Charitable Trust	1,700
Ngati Kahungunu Iwi Inc	850
Total:	$13,800

3.7 Attachments

Nil

Finance Committee - 01 May 2018 - Open Agenda

Finance Committee

Open Minutes

Meeting Date:	Tuesday 20 March 2018
Time:	3.00pm-3.56pm
Venue	Council Chamber Hawke’s Bay Regional Council 159 Dalton Street Napier

Present	Mayor Dalton, Councillor Wise (In the Chair), Councillors Boag, Brosnan, Dallimore, Hague, Jeffery, McGrath, Price, Tapine, Taylor, White and Wright
In Attendance	Chief Executive Officer, Director Corporate Services, Director Community Services, Director City Strategy, Manager Communications and Marketing, Chief Financial Officer, Manager Business Excellence & Transformation, Team Leader Governance, Senior Advisor Policy, Community Advisor, MTG Director
Administration	Governance Team

Apologies

Nil

Conflicts of interest

Nil

Public forum

Nil

Announcements by the Mayor

Nil

Announcements by the Chairperson

Nil

Announcements by the management

Nil

Confirmation of minutes

Councillors Brosnan / Wright

That the Minutes of the meeting held on 6 December 2017 were taken as a true and accurate record of the meeting.

Carried

Notification and justification of matters of extraordinary business

(Strictly for information and/or referral purposes only).

Agenda Items

1. Hawkes Bay Local Authority Shared Services - Structure change

Type of Report:	Legal
Legal Reference:	Local Government Official Information and Meetings Act 1987
Document ID:	447078
Reporting Officer/s & Unit:	Adele Henderson, Director Corporate Services

1.1 Purpose of Report

To propose the legal structure of Hawke’s Bay Local Authority Shared Services Limited (HBLASS) become dormant in order to focus attention and resources on the purpose of HBLASS and reduce compliance costs for all the councils.

At the Meeting

In response to questions from Councillors, the Director Corporate Services and Chief Executive noted the following:

· Officers do not expect the proposed changes to have any effect on budgets.

· The proposed changes will allow Council to invest more time directly in collaboration opportunities.

· Funding for the Chairperson and Collaborator roles will continue at this time as part of Council’s commitment to shared services.

· The Collaborator will continue to report to the Chief Executive Forum and will meet with the shared services groups regularly.

· Newsletters providing updates on shared interests and outcomes will continue to be circulated to councils, including Councillors, and uploaded to the website. A Collaboration booklet is being prepared for distribution also.

Committee's recommendation

Mayor Dalton / Councillor Wright

That the Council:

a. Agree HBLASS, as a legal entity will be dormant in the short term; with the ability for the legal entity able to be reactivated in the future.

b. Note that the dormant status of HBLASS is effective on receipt of agreement by all members of the Board.

c. Note that the decision on the dormant status of HBLASS will be determined by the majority of councils.

d. Note that each Council will continue its participation in a Collaborative approach that has proven effective in a pilot: Hawke’s Bay Councils delivering Service and Value.

e. That the Councils approve the exemption of HBLASS from the Council Controlled Organisation requirements (Local Government Act Section 7(3))

f. Note that each Council will actively support shared and common goal setting, decision-making, resourcing including financial contribution, staff and communication.

Carried

2. Representation Review

Type of Report:	Legal
Legal Reference:	Local Electoral Act 2001
Document ID:	441536
Reporting Officer/s & Unit:	Jane McLoughlin, Team Leader Governance Rachael Horton, Manager Business Excellence & Transformation

2.1 Purpose of Report

To determine Council’s initial proposal for representation arrangements for the 2019 and 2022 elections.

At the Meeting

Councillor Price moved a substitute motion that Part A of the Officer’s Recommendation reflect that option 2.6b (being the status quo of 12 Councillors, six ward Councillors under the current ward structure and six at large Councillors) be the preferred option taken out for consultation.

In response to questions from Councillors, the Team Leader Governance clarified the following points:

· 75% of Territorial Authorities use the ward-only system. 7% of Territorial Authorities (Five councils including Napier) currently use the mixed system, with Tauranga being the only other City Council.

· Option B with three wards and four ‘at large’ councillors (which was not outlined in the Council report as an option, but considered in Attachment D, page 169), is initially considered feasible; consideration would need to be given as to whether the new ward boundaries and configuration of Councillors would appropriately group communities of interest together to ensure fair and effective representation. The analysis shows that the four current wards generally accommodate the communities of interest well.

In discussion in relation to Part A of the Officer’s Recommendation (basis of election), the following points were made by some Councillors:

· The analysis undertaken is extremely comprehensive and a useful starting point for this discussion.

· Napier is a small city which does not take long to traverse and some Councillors believed that this means that all Councillors are already very accessible to the public.

· Napier’s Council is currently diverse and one Councillor felt that it was adequately representative of the Napier community.

· Although the analysis shows that a ward-only system has historically provided a good level of effective and fair representation, some Councillors were concerned that this was not the community’s preferred basis for election as outlined in the pre-consultation.

· It was believed that the mixed system provides a level of ‘check and balance’ between the ward Councillors and at large councillors, with at large Councillors taking a city-wide view in decision-making.

· A full ward system could result in block voting and were concerned that this would translate to ineffective representation.

· There was some question as to whether the ward-only system would actually translate into increased voter turnout or participation. Napier already has higher voting numbers than the rest of the country, even with the existing mixed system.

· The current mixed system allows voters to choose a larger proportion of the total Councillors than would be possible under a ward only system.

· There have been a number of instances of unopposed elections to ward positions which may be seen to reduce democracy; in cases where there is a strong incumbent potential new candidates may be deterred from standing.

· There was general agreement that single member ward councillors face particular challenges under the current structure.

· There was general agreement that a mixed system offered the “best of both worlds” but the current ‘status quo’ could be improved, for example by removing single member wards.

· It was suggested that a mixed system based on 3 wards may offer another option for consideration as a possible structure.

· There is a lack of clarity around the roles of ‘at large’ Councillors; they are very willing to be involved in ward-specific activities and communications, but would appreciate guidance from ward Councillors on how best to be involved.

· Ward Councillors noted that it would be helpful to be able to spread the workload at times and increased numbers of members in each ward would contribute towards this.

· Councillors were interested to see the results of future public consultation and would like for the full analysis undertaken by Officer’s to be made available to the public in this process.

With regards to Parts B and C of the Officer’s recommendation (total number of Councillors and Community Boards),

· There was general agreement to retain 12 Councillors plus the Mayor.

· There was a general discussion around whether community boards would help voter turnout and engagement in some areas. It was noted that the people most likely to stand as candidates for a community board would be the same people that are already heavily committed with other boards.

· Council recognise that some communities of interest are quite disengaged from Council but this can be addressed in other ways.

It was decided to take the Officer’s Recommendation in separate parts for clarity on the final Committee Recommendation to Council.

Officer’s Recommendation

That Council:

Approve the initial proposal for representation arrangements for the 2019 and 2022 elections, and that the proposal be distributed for public consultation, that initial proposal being:

a. the basis of election is Ward-only based on the current Ward structure:

i. that two Elected Members be elected by the electors of the Ahuriri Ward

ii. that two Elected Members be elected by the electors of the Onekawa-Tamatea Ward

iii. that four Elected Members be elected by the electors of the Nelson Park Ward

iv. that four Elected Members be elected by the electors of the Taradale Ward

b. the total number of Elected Members is 12 and the Mayor

c. that there be no community boards within Napier City.

Substitute Motion

Councillors Price / Mayor Dalton

That Council:

Approve the initial proposal for representation arrangements for the 2019 and 2022 elections, and that the proposal be distributed for public consultation, that initial proposal being:

a. retain the status quo of representation arrangements as they currently stand; 12 Elected Members, current ward structure, mixed system of six Elected Members at large, and six Elected Members elected via wards

Cr Boag against

b. the total number of Elected Members is 12 and the Mayor

c. that there be no community boards within Napier City.

Committee's recommendation

Councillor Price / Mayor Dalton

That Council:

Approve the initial proposal for representation arrangements for the 2019 and 2022 elections, and that the proposal be distributed for public consultation, that initial proposal being:

Cr Boag against

b. the total number of Elected Members is 12 and the Mayor

c. that there be no community boards within Napier City.

Carried

3. Financial Forecast to 30 June 2018

Type of Report:	Enter Significance of Report
Legal Reference:	Enter Legal Reference
Document ID:	445812
Reporting Officer/s & Unit:	Caroline Thomson, Chief Financial Officer

3.1 Purpose of Report

To report to Council the financial forecast to the 30 June 2018 for the whole of Council.

At the Meeting

The Chief Financial Officer spoke to the report highlighting the following points:

· The forecast net surplus is $5.3M at 30 June 2018.

· The forecast capital plan is $39.7M down from $51.3M as a result of:

o A review by the New Zealand Transport Agency which identified works now not required in this financial year,

o The revised stormwater and sewerage renewal programmes,

o Council’s decision not to proceed with the multi-use sports facility, and

o The current review of CBD parking options.

Committee's recommendation

Councillors Hague / Taylor

That the Committee

a. Receive the financial forecast to 30 June 2018.

Carried

4. Hawke's Bay Museums Trust - Draft Statement of Intent 2018 - 20

Type of Report:	Enter Significance of Report
Legal Reference:	Enter Legal Reference
Document ID:	435714
Reporting Officer/s & Unit:	Caroline Thomson, Chief Financial Officer

4.1 Purpose of Report

To provide the draft Statement of Intent 2018 – 20 for the Hawke’s Bay Museums Trust to Council for its consideration as part of the reporting requirements for council-controlled organisations.

At the Meeting

In response to questions from Councillors it was noted that the management agreement between Council and the Hawke’s Bay Museums Trust clearly outlines Council’s responsibilities in relation to managing the collection.

Committee's recommendation

Mayor Dalton / Councillor Hague

That Council

a. Receive the Hawke’s Bay Museums Trust Draft Statement of Intent 2018 - 20 and provide any feedback to the Trust for their consideration.

Carried

5. Hawke's Bay Museums Trust - Half Yearly Report to 31 December 2017

Type of Report:	Enter Significance of Report
Legal Reference:	Enter Legal Reference
Document ID:	435717
Reporting Officer/s & Unit:	Caroline Thomson, Chief Financial Officer

5.1 Purpose of Report

To provide the half-yearly report for 2017/18 for the Hawke’s Bay Museums Trust for adoption.

At the Meeting

There was no discussion on this item.

Committee's recommendation

Councillors Wright / Price

That Council

a. Receive the half-yearly report for 2017/18 from the Hawke’s Bay Museums Trust.

Carried

6. Quarterly Report for the six months ended 31 December 2017

Type of Report:	Enter Significance of Report
Legal Reference:	Enter Legal Reference
Document ID:	446664
Reporting Officer/s & Unit:	Caroline Thomson, Chief Financial Officer

6.1 Purpose of Report

To consider the Quarterly Report for the six months ended 31 December 2017.

At the Meeting

Councillors noted the quality of the report and appreciated that it was very user friendly.

Committee's recommendation

Councillors Taylor / Brosnan

That the Committee

a. Receive the Quarterly Report for the six months ended 31 December 2017.

Carried

PUBLIC EXCLUDED ITEMS

Councillors Brosnan / Jeffery

That the public be excluded from the following parts of the proceedings of this meeting, namely:

1. Digital Equity for All - Te Papa Partnership

Carried

The general subject of each matter to be considered while the public was excluded, the reasons 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 were as follows:

General subject of each matter to be considered.	Reason for passing this resolution in relation to each matter.	Ground(s) under section 48(1) to the passing of this resolution.
1. Digital Equity for All - Te Papa Partnership	7(2)(i) Enable the local authority to carry on, without prejudice or disadvantage, negotiations (including commercial and industrial negotiations)	48(1)A That the public conduct of the whole or the relevant part of the proceedings of the meeting would be likely to result in the disclosure of information for which good reason for withholding would exist: (i) Where the local authority is named or specified in Schedule 1 of this Act, under Section 6 or 7 (except 7(2)(f)(i)) of the Local Government Official Information and Meetings Act 1987.

The meeting moved into committee at 3.56pm.

Approved and adopted as a true and accurate record of the meeting.

Chairperson .............................................................................................................................

Date of approval ......................................................................................................................

Committee Members	Councillor Hague (In the Chair), Mayor Dalton, Councillors Boag, Brosnan, Dallimore, Jeffery, McGrath, Price, Tapine, Taylor, White and Wright
Officer Responsible	Director Corporate Services
Administration	Governance Team
	Next Finance Committee Meeting Tuesday 12 June 2018

Meeting Date:	Tuesday 1 May 2018
Time:	3.00pm
Venue:	Council Chamber Hawke’s Bay Regional Council 159 Dalton Street Napier