Estimated $4.3b needed for capital projects

The LTP report was discussed in council yesterday. File photo.

Tauranga City Council faces a “challenging” funding shortfall over the coming decade because of the need to invest in new infrastructure for a rapidly growing city.

A report for yesterday’s council meeting estimates that up to $4.3 billion needs to be invested in capital projects as part of the Long-term Plan 2021-31.

This is about double the council’s ability to fund and finance under the current local government funding model.

Capital investment relates to long-term projects in which the council buys, maintains or improves major pieces of property.

Tauranga’s status as the country’s fastest-growing city means the council needs to invest billions of dollars in roads, parks, pipes, stormwater systems and other infrastructure to open up land for new homes and cater to the intensification of Te Papa peninsula.

The report, from Corporate Services General Manager Paul Davidson and Strategy and Growth General Manager Christine Jones, provides an update on important financial issues and scenarios for the upcoming Long-term Plan 2021-31 (LTP).

The council faces decisions that are “significantly more challenging than anything faced before,” the report says.

Davidson said that, due to the size of the infrastructure requirements and the resulting pressure on funding, it was clear that traditional funding and financing solutions would be insufficient.

“Growth councils such as ours have been saying for some time that the traditional funding and financing mechanisms are no longer working and that alternatives are required.

“The scenarios in this report will be further developed to clearly outline what we can provide for our community – and the cost in terms of rate funding, debt and any other options available.”

A bare-minimum scenario called ‘committed and prioritised projects’ was estimated to require $3.7 billion, while a scenario called ‘growing connected communities’ would require $4.3 billion.

The council will explore a range of options to make up the shortfall, and the information in the report will be used to develop more detailed options.

The LTP will lay out the plan for investing in our city for the coming decade, with the aim of making Tauranga a better place to live. it will help determine how our city recovers from the COVID-19 recession and how we should cope with population growth.

The council will consult with the community about the LTP in April next year, aiming to hear people’s views on a wide range of important matters that will affect our futures.

The mayor and councillors will take this feedback into account before adopting the LTP in time for its 1 July start date.

Top 10 programmes 2021-31

Completing the Wāiari Water Supply Scheme

Cameron Rd upgrades

Te Papa intensification

Community Facilities Investment Plan

Wairoa Active Reserve and other amenity projects (eg parks)

Transport System Plan rollouts (including cycleways, Accessible Streets, multimodal)

Resilience projects

Standard renewal and upgrade programmes

Completing existing growth areas (Tauriko Business Estate, Pyes Pa, Wairakei)

New growth areas (Te Tumu, Tauriko West)
 




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6 Comments

It's easy...

Posted on 24-11-2020 11:56 | By morepork

...just divide 4.3 billion by the population of Tauranga (135,000) and all we need is a donation from each person here. Each of us simply needs to stump up $31,851.85. I’ll get a cheque in the mail right away... Don’t forget the 85 cents; it is critical.

Money

Posted on 19-11-2020 13:33 | By Kancho

Money fixes a lot it’s about priorities and sharp planning . So rates will undoubtedly rise as Tenby tried to tell us even though unpalatable it is in fact always what happens regardless , everything costs more. It is more about not wasting money or the wrong priority. We all see examples of projects that have cost more but delivered less. Unless a big bale out from Government we slowly sunk while treading water. Government however has huge stress on money supply too as it’s not a bottomless supply that many dream it is. Borrowing from China etc digs the whole country into the hole of expectations. It’s a shame council continues to be a side show, it’s a shame this brings competency into question and the focus is not on better efficiency in operation of finance and value for money.

A Challenging Funding Shortfall

Posted on 19-11-2020 10:52 | By Yadick

Then why are you mucking around with the streets at the Mount. With all the committee’s, all the meetings, all the trials to see what works, and eventually a possible outcome that will have an associated MASSIVE budget blowout. You could save millions. Where’s the genuine stats for how unsafe and how many injury accidents there’s been? It’s not bl@@dy broken, nothing needs doing to it - SAVE THE MONEY. How much is it costing trying to fix a broken Council - well there’s another MASSIVE budget blowout and it’s far from fixed - worse than Greerton.

Hopeless!

Posted on 18-11-2020 21:00 | By WordsFailMe

I suppose somewhere in this $4.3b a substantial increase in "Management Wages" can be accommodated?

Developments should be self funding

Posted on 18-11-2020 17:06 | By Johnney

If council need to invest in infrastructure for growing subdivisions then the ratepayers are subsidising the developers. This doesn’t sound right.

Tom Ranger

Posted on 18-11-2020 11:25 | By Tom Ranger

Doing projects correctly the first time would help.

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