Proposal to join the Local Government Funding Agency

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We are proposing to join the New Zealand Local Government Funding Agency (LGFA) scheme. Joining the LGFA will improve our financial resilience, provide cost savings and provide increased certainty around funding availability.

We currently have no external borrowing or debt. Historically, we have preferred to borrow internally, by lending from our reserves to fund certain activities.

However, the Long-term Plan 2021-31 consultation document and our draft financial strategy, proposes to change this from year 1. While the total level of borrowing (internal and external combined) would remain at similar levels, by borrowing externally we will reduce interest costs for reserves that are in deficit and it allows cashflow to be managed more efficiently as total borrowing is forecast to exceed the level of our financial assets.

Our draft financial strategy is proposing to borrow $25 million for the first five years, decreasing by $2 million per year from 2025-26 down to $15 million in 2030-31. We can borrow at more favourable interest rates as a participant in the LGFA.

The LGFA is a Council-Controlled Organisation (CCO) operating under the Local Government Act 2002 and the Local Government Borrowing Act 2011. The LGFA specialises in financing the New Zealand local government sector, the primary purpose being to provide more efficient funding costs and diversified funding sources for New Zealand local authorities. The LGFA was established to raise debt on behalf of local authorities on terms that are more favourable to them than if they raised the debt directly. They are able to loan funds to councils across New Zealand and they have an S&P Global Ratings long-term rating of AA+.

More information can be found on the LGFA website.

The proposal and submission form are below.

This consultation closes at 5pm Friday 16 July.

We are proposing to join the New Zealand Local Government Funding Agency (LGFA) scheme. Joining the LGFA will improve our financial resilience, provide cost savings and provide increased certainty around funding availability.

We currently have no external borrowing or debt. Historically, we have preferred to borrow internally, by lending from our reserves to fund certain activities.

However, the Long-term Plan 2021-31 consultation document and our draft financial strategy, proposes to change this from year 1. While the total level of borrowing (internal and external combined) would remain at similar levels, by borrowing externally we will reduce interest costs for reserves that are in deficit and it allows cashflow to be managed more efficiently as total borrowing is forecast to exceed the level of our financial assets.

Our draft financial strategy is proposing to borrow $25 million for the first five years, decreasing by $2 million per year from 2025-26 down to $15 million in 2030-31. We can borrow at more favourable interest rates as a participant in the LGFA.

The LGFA is a Council-Controlled Organisation (CCO) operating under the Local Government Act 2002 and the Local Government Borrowing Act 2011. The LGFA specialises in financing the New Zealand local government sector, the primary purpose being to provide more efficient funding costs and diversified funding sources for New Zealand local authorities. The LGFA was established to raise debt on behalf of local authorities on terms that are more favourable to them than if they raised the debt directly. They are able to loan funds to councils across New Zealand and they have an S&P Global Ratings long-term rating of AA+.

More information can be found on the LGFA website.

The proposal and submission form are below.

This consultation closes at 5pm Friday 16 July.

  • Consultation has concluded
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