Long-term Plan 2021-31

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Building a better future for you and for our environment

What a year 2020 was. We’re pleased to see the back of it so we can focus on our future and it’s more important than ever that we get our next 10-year plan right.

Here we explain what we think we should be doing over the next 10 years. Take a look at these videos, and the information below. If you like what you see or you have another option, we’d like to hear from you. Make your submission below, to help make a difference to Otago’s future.

Due to the incomplete delivery of LTP consultation documents into every mailbox throughout Otago, we will accept all late submissions up until 5pm Sunday 16 May. See the media statement regarding this here.





Building a better future for you and for our environment

What a year 2020 was. We’re pleased to see the back of it so we can focus on our future and it’s more important than ever that we get our next 10-year plan right.

Here we explain what we think we should be doing over the next 10 years. Take a look at these videos, and the information below. If you like what you see or you have another option, we’d like to hear from you. Make your submission below, to help make a difference to Otago’s future.

Due to the incomplete delivery of LTP consultation documents into every mailbox throughout Otago, we will accept all late submissions up until 5pm Sunday 16 May. See the media statement regarding this here.





Consultation has concluded
  • Proposal 1: Helping you manage pests

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    Helping you manage pests


    Changing service level and how we fund it

    Keeping pests out and minimising the damage caused by established pests is essential to protect Otago’s diverse and internationally significant environment.

    Pest management sits in our biodiversity activity. It supports Otago’s ability to enable thriving biodiversity (the variety of life in a given habitat), maintain healthy ecosystems and maximise natural resources for economic gain.

    Under the Biosecurity Act 1993, Otago’s Regional Pest Management Plan (RPMP) identifies 51 species to be managed by land occupiers, with oversight from us.

    Pest management focuses on five activity areas: exclusion, eradication, containment, sustained control, and supporting the site-led community control of pest plants and animals.

    STICKING WITH THE STATUS QUO IS NOT AN OPTION

    Our resourcing for pest management in biosecurity doesn’t meet community expectations or achieve the Regional Pest Management Plan’s (RPMP) intended outcomes. Inadequate resourcing limits opportunities to enhance biodiversity and support economic productivity.

    To achieve Otago’s objectives in biosecurity and biodiversity, increased investment and increasing our resourcing capacity and capability is needed to undertake new areas of work and expand services.

    Photograph of a wallaby amongst some bracken, which is a pest in Otago


    What should we deliver?

    We’ve prepared two service delivery options for you to choose from. Each represents a different level of investment in year 1 of the LTP and timeframe for implementation.

    Each option spreads the impact of increased resourcing so that we can meet our legislative requirements, strategic goals and, most importantly, better meet community expectations.


    Option 1

    Cost: $4.6 million from year 1 onwards


    Option 2 (PREFERRED)

    Cost: $3.3 million from year 1 onwards

    An immediate and significant increase in capacity and capability to manage pests.

    This enables us to rapidly plan and deliver a more comprehensive education, engagement and enforcement approach to manage pests identified in our RPMP. It features:

    • More ORC team members covering a wider area and engaging directly with landowners and community groups
    • More inspections and compliance checks, education for landowners on their responsibilities, facilitating landowner-led rabbit control operations, and monitoring and evaluating the environmental impact
    • Support for community-led rabbit control, like rabbit control training and subsidies
    • Continuing partnerships to maintain the gains already achieved by OSPRI’s TBfree work and Predator Free Dunedin
    • New areas of biosecurity focus, such as marine biosecurity and dedicated biosecurity advisers for wilding conifer control
    • Provision of practical information and tools to assist landowners with biosecurity (including rabbit control)
    • Risk assessment for non-established pests and pest pathways into Otago
    • Development of a Regional Wilding Conifer Management Strategy, and Freshwater Lake Management Plan


    A moderate increase in staff capacity to undertake more education, engagement and enforcement to manage pests.

    This option means building capacity and capability over three years. It's largely based on Option 1 but includes the following adjustments:

    • Continuing partnerships to maintain the gains already achieved by OSPRI’s TBfree work and Predator Free Dunedin, starting after 2022-23
    • The support provided to ensure community-led responses are successful is reduced (compared to Option 1). Support includes building knowledge on control techniques, facilitating large-scale control efforts and provision of community grants to enable action
    • The number of new community-led responses that we can help start each year is reduced (compared to Option 1)
    • New areas of biosecurity focus – including marine biosecurity and dedicated biosecurity advisers for wilding conifer control, starting after 2022-23
    • Development of a Regional Wilding Conifer Management Strategy, and Freshwater Lake Management Plan, starting after 2022-23


    Photograph of a plant called Old Man's Beard, which is a pest species in Otago


    How we will fund increased service for pest management?

    To date, our biosecurity service has been funded via general rates. This means every ratepayer in Otago pays a share of the total spend based on the capital value of each property.

    The issues associated with the status quo are:

    • It isn’t consistent with the Regional Pest Management Plan (RPMP), which reflects a principled approach based on equity between who benefits and who pays
    • The capital value based general rate provides a disproportionate benefit to rural landowners
    • It’s difficult to establish reserve funds for biosecurity
    • There is no transparency on the rating bill


    WE ARE PROPOSING THREE OPTIONS FOR FUNDING PEST MANAGEMENT FROM 1 JULY 2021:


    Option A

    Regional General Rate based on capital value (CV)

    This option reflects how we currently fund biosecurity activities, where all property owners across the region pay a share of biosecurity costs based on the capital value of their property. In general, this sees urban areas with higher concentrations of capital and low demand for or low direct benefit from our biosecurity service, yet paying an equal share.





    Option B (PREFERRED)

    Regional Targeted Rate - biosecurity activity costs are shared across all ratepayers based on their land value (LV)

    This option would change how we currently fund biosecurity activities and would see all property owners across the region paying a share of biosecurity costs based on the value of land owned. In general, the larger the land ownership the more benefit that is likely to be gained from our biosecurity service.




    Option C

    Mixed rating - biosecurity activity costs are split 50:50. Half is paid as a targeted rate by rural and lifestyle ratepayers via land value. The other half is applied to all ratepayers via the general rate (capital value).

    This option also changes how we currently fund biosecurity activities and aligns more closely with how we consider the benefits from our increased biosecurity service level match the cost for property owners. However, over time our work programme and priorities can change, along with the alignment of who benefits, which is why we’re not recommending this option.







    How will this impact your rates?

    The following tables show how much each service delivery option would cost in future rates based on the different funding options. The key comparison is between rural/lifestyle properties and other properties (mainly residential) across a range of capital values.

    The average column gives another perspective by showing the average capital value. As rural/lifestyle properties are on average higher value than other properties, they pay more under a CV general rate but this doesn't fairly reflect the additional benefits they receive from the activity. The two targeted rate options take this into account.

    In both Options 1 and 2, funding Option A is higher as no targeted rate reserve is available.

    TABLE – Option 1 $4.6 million total spend from year 1 onwards Under funding Option A, where a general rate would be applied to the capital value of a property; a property with a capital value of $350,000 would pay $19.21, a capital value of $700,000 would pay $38.41, a capital value of $1,000,000 would pay $54.88, and a capital value of $4,000,000 would pay $219.51. The average rural or lifestyle property would pay $79.96 and the average other property would pay $36.66. The total rates collected under Option A would be $4,400,000. Under our preferred option, funding Option B, where a regional targeted rate would be applied to the land value of a property; a rural or lifestyle property with a capital value of $350,000 would pay $18.36, a capital value of $700,000 would pay $32.92, a capital value of $1,000,000 would pay $49.61, and a capital value of $4,000,000 would pay $257.76. The average rural or lifestyle property would pay $90.40. The other category of property with a capital value of $350,000 would pay $13.75, a capital value of $700,000 would pay $29.27, a capital value of $1,000,000 would pay $46.62, and a capital value of $4,000,000 would pay $195.85. The average property would pay $26.63. The total rates collected under Option B would be $3,650,000. Under funding Option C, where a mixed rate is applied; a rural or lifestyle property with a capital value of $350,000 would pay $34.36, a capital value of $700,000 would pay $63.24, a capital value of $1,000,000 would pay $94.05, and a capital value of $4,000,000 would pay $461.50. The average rural or lifestyle property would pay $163.09. The other category of property with a capital value of $350,000 would pay $7.97, a capital value of $700,000 would pay $15.93, a capital value of $1,000,000 would pay $22.76, and a capital value of $4,000,000 would pay $91.05. The average property would pay $15.21. The total rates collected under Option C would be $3,650,000.
    TABLE – Option 2 $3.3 million total spend from year 1 onwards Under funding Option A, where a general rate would be applied to the capital value of a property; a property with a capital value of $350,000 would pay $13.75, a capital value of $700,000 would pay $27.50, a capital value of $1,000,000 would pay $39.29, and a capital value of $4,000,000 would pay $157.15. The average rural or lifestyle property would pay $57.24 and the average other property would pay $26.25. The total rates collected under Option A would be $3,150,000. Under our preferred option, funding Option B, where a regional targeted rate would be applied to the land value of a property; a rural or lifestyle property with a capital value of $350,000 would pay $12.07, a capital value of $700,000 would pay $21.64, a capital value of $1,000,000 would pay $32.62, and a capital value of $4,000,000 would pay $169.49. The average rural or lifestyle property would pay $59.44. The other category of property with a capital value of $350,000 would pay $9.04, a capital value of $700,000 would pay $19.24, a capital value of $1,000,000 would pay $30.66, and a capital value of $4,000,000 would pay $128.78. The average property would pay $17.51. The total rates collected under Option B would be $2,400,000. Under funding Option C, where a mixed rate is applied; a rural or lifestyle property with a capital value of $350,000 would pay $22.59, a capital value of $700,000 would pay $41.58, a capital value of $1,000,000 would pay $61.84, and a capital value of $4,000,000 would pay $303.45. The average rural or lifestyle property would pay $107.23. The other category of property with a capital value of $350,000 would pay $5.24, a capital value of $700,000 would pay $10.48, a capital value of $1,000,000 would pay $14.97, and a capital value of $4,000,000 would pay $59.87. The average property would pay $10.00. The total rates collected under Option C would be $2,400,000.



  • Proposal 2: Balancing the budget

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    Balancing the budget


    LET'S TALK MONEY

    We are continuing to grow as an organisation, to provide more for the community and our environment. With growth comes increased funding requirements and this impacts on the next 10 years. It’s essential that we have a clear and prudent approach to aligning our expenses with our income, which includes rates. This is called a balanced budget and looks out 10 years.

    Our growth and the decision by our councillors, at your request, to defer a general rates increase during the national COVID-19 lockdown in 2020 has required us to carefully consider what is needed to achieve a balanced budget.

    We need to check in with you on what you think about our preferred option for achieving a balanced budget.

    THE FUNDING CHALLENGES

    We face a significant financial challenge over the next 10 years. Our planned expenditure has grown substantially compared to our previous Long-term Plan (LTP).

    Our operating expenditure is proposed to increase by $20M in year 1 of the LTP in regional planning, environmental monitoring, science and regulatory activities. This includes an unplanned component of expenditure needed in 2020 to quickly respond to central government direction on freshwater management. It also builds on last year’s expenditure increase of $10M consulted publicly in the 2020-21 Annual Plan.

    COVID-19 complicated matters and our councillors heard loudly from you and voted to fund $4.9M of the above $10M increase with a ‘general reserve offset’ (think of it as a loan). This means we used our financial reserves to avoid a general rates increase during the height of the crisis. The problem is that we can’t keep using our reserves to subsidise our operational work – we need a sustainable and enduring source of funding.

    So, to break it down – to fund the unplanned work and the COVID-19 general reserve offset equates to a 44% increase to general rates. That’s before any new LTP funding is even factored in.

    We’ve looked at other funding sources to reduce the rates requirement, including increased dividends from our investments, using reserves, and using external debt, which we haven’t historically done.

    Despite this, a significant increase in rates is still required in year 1 to meet the immediate increase in operating expenditure so that we have a balanced budget.

    While the proposed increase in rates is large in percentage terms, the dollar amount of rates, particularly general rates collected, is relatively small. The average general rates paid in Otago is currently $107 and the average total rates bill is $259.


    So, how are we proposing to solve this funding issue?

    There are two options to consider:


    Option 1 (PREFERRED)

    Increase total rates to achieve an immediate and sustainable funding source for our operational expenditure.

    This is our preferred option. It would mean increasing total rates immediately in year 1 (47.5%) with smaller increases in years 2 (17.0%) and 3 (10.6%), before maintaining rates with minimal increases thereafter (an average of 3.5%).

    The total rates increase comprises general rates increases of 73.2%, 15.7% and 6.8%, and targeted rates increases of 29.3%, 18.2% and 14.2% in years 1 to 3 respectively.

    This ensures funding sources are increased to the sustainable level required by the time we fully review this Long-term Plan in three years and it doesn’t continue into future LTPs.

    Graph showing the proposed total rates and increases over the next 10 years under option 1. In year 1 it shows an average rates increase of 47.5% or total rates charged being $39,762,000, comprising of $19,364,000 in general rates and $20,398,000 in targeted rates. Year 2 shows an average rates increase of 17% or total rates charged being $46,519,000, comprising of $22,407,000 in general rates and $24,112,000 in targeted rates. Year 3 shows an average rates increase of 10.6% or total rates charged being $51,460,000, comprising of $23,920,000 in general rates and $27,539,000 in targeted rates. Year 4 shows an average rates increase of 3.8% or total rates charged being $53,812,000, comprising of $23,847,000 in general rates and $29,965,000 in targeted rates. Year 5 shows an average rates increase of 4.4% or total rates charged being $56,155,000, comprising of $23,248,000 in general rates and $32,908,000 in targeted rates. Year 6 shows an average rates increase of 2.6% or total rates charged being $57,606,000, comprising of $23,415,000 in general rates and $34,191,000 in targeted rates. Year 7 shows an average rates increase of 5.2% or total rates charged being $60,575,000, comprising of $24,316,000 in general rates and $36,259,000 in targeted rates. Year 8 shows an average rates increase of 1.8% or total rates charged being $61,670,000, comprising of $24,646,000 in general rates and $37,024,000 in targeted rates. Year 9 shows an average rates increase of 2.9% or total rates charged being $63,457,000, comprising of $25,128,000 in general rates and $38,329,000 in targeted rates. Year 10 shows an average rates increase of 3.2% or total rates charged being $65,504,000, comprising of $26,022,000 in general rates and $39,483,000 in targeted rates.


    For this option, the general rate component of the total rates bill in year 1 will increase on average from $107 to $186. This is an increase of $79 for the year.

    The total amount paid will vary across the region and increase as the capital value of your property increases.

    Examples of the general rates payable in year 1 under Option 1 are:

    TABLE Under Option 1, a property in Central Otago with a capital value of $350,000 would pay general rates of $103.30, a capital value of $700,000 would pay $157.67, a capital value of $1,000,000 would pay $204.27, and a capital value of $4,000,000 would pay $670.33. The median capital value in Central Otago is $550,000 which gives a median rate of $134.37. In Clutha a property with a capital value of $350,000 would pay general rates of $105.54, a capital value of $700,000 would pay $162.16, a capital value of $1,000,000 would pay $210.69, and a capital value of $4,000,000 would pay $696.00. The median capital value in Clutha is $300,000 which gives a median rate of $97.45. In Dunedin a property with a capital value of $350,000 would pay general rates of $126.57, a capital value of $700,000 would pay $204.22, a capital value of $1,000,000 would pay $270.78, and a capital value of $4,000,000 would pay $936.37. The median capital value in Dunedin is $450,000 which gives a median rate of $148.76. In Queenstown Lakes a property with a capital value of $350,000 would pay general rates of $101.69, a capital value of $700,000 would pay $154.46, a capital value of $1,000,000 would pay $199.69, and a capital value of $4,000,000 would pay $652.00. The median capital value in Queenstown Lakes is $900,000 which gives a median rate of $184.62. In Waitaki a property with a capital value of $350,000 would pay general rates of $102.25, a capital value of $700,000 would pay $155.58, a capital value of $1,000,000 would pay $201.28, and a capital value of $4,000,000 would pay $658.37. The median capital value in Waitaki is $350,000 which gives a median rate of $102.25.


    Option 2

    Use a ‘general reserve offset’ (reserves), meaning smoother rates increases over the next 10 years to sustainably fund our operational expenditure. We'd need to borrow money to achieve this and then repay it; it's deferring the impact of our increased expenses.

    While this will reduce the immediate rates burden, it will defer the funding of current operating expenditure until later years.

    Although this option avoids a large rates increase in year 1 (as per Option 1), it still requires the same amount of rates funding over the 10 years of the LTP.

    It also means that a significant level of debt (associated with the general rate offset balance) is built up until rates increase to a point where this begins to be repaid. So, it’s delaying the year 1 increase to a later period, a bit like ripping the sticky plaster off slowly.

    There is more risk to the community in this funding option.

    As we saw in the 2020-21 year, with COVID-19 and changes in central government requirements, future spending and funding requirements are uncertain and may change. If this happens, it may become challenging to repay the ‘loan’ and future service delivery may be seriously compromised.

    Under this option, we wouldn’t be able to permanently fund the 2020-21 general rates offset with our reserves as these are required to reduce future rates increases. Once our reserves eventually run out, we'd look to external sources to loan us the funds to carry out the work required of us.

    Over the 10 years of the LTP a general rates increase of 13.5% would be required every year.

    Our deferred funding balance would increase over years 1-5 to a maximum of $34M, at which point it would begin to be repaid.

    Targeted rate increases remain the same as Option 1 so the total rate increase in year 1 drops to 22.7%. Years 2 (16.4%) and 3 (13.9%) are similar to Option 1 but increases thereafter are significantly higher than Option 1, with increases from 7.0% to 11.2%.

    Graph showing the summary of rates, increases and the deferred funding debt over the next 10 years under Option 2. In year 1 it shows an average rates increase of 22.7% or total rates charged being $39,763,000, comprising of $19,365,000 in general rates and $20,398,000 in targeted rates. There is a deferred funding balance of negative $11,564,000. Year 2 shows an average rates increase of 16.4% or total rates charged being $38,503,000, comprising of $14,391,000 in general rates and $24,112,000 in targeted rates. There is a deferred funding balance of negative $19,580,000. Year 3 shows an average rates increase of 13.9% or total rates charged being $43,866,000, comprising of $16,327,000 in general rates and $27,539,000 in targeted rates. There is a deferred funding balance of negative $27,173,000. Year 4 shows an average rates increase of 10.3% or total rates charged being $48,398,000, comprising of $18,524,000 in general rates and $29,874,000 in targeted rates. There is a deferred funding balance of negative $32,195,000. Year 5 shows an average rates increase of 11.2% or total rates charged being $53,829,000, comprising of $21,016,000 in general rates and $32,813,000 in targeted rates. There is a deferred funding balance of negative $34,115,000. Year 6 shows an average rates increase of 7.6% or total rates charged being $57,938,000, comprising of $23,844,000 in general rates and $34,094,000 in targeted rates. There is a deferred funding balance of negative $33,364,000. Year 7 shows an average rates increase of 9.1% or total rates charged being $63,210,000, comprising of $27,052,000 in general rates and $36,158,000 in targeted rates. There is a deferred funding balance of negative $30,294,000. Year 8 shows an average rates increase of 7.0% or total rates charged being $67,612,000, comprising of $30,692,000 in general rates and $36,920,000 in targeted rates. There is a deferred funding balance of negative $23,903,000. Year 9 shows an average rates increase of 8.0% or total rates charged being $73,043,000, comprising of $34,822,000 in general rates and $28,221,000 in targeted rates. There is a deferred funding balance of negative $13,853,000 Year 10 shows an average rates increase of 8.0% or total rates charged being $78,879,000, comprising of $39,508,000 in general rates and $39,371,000 in targeted rates. There is no deferred funding balance this year.


    For this option the general rate component of the total rates bill in year 1 will increase on average from $107 to $122. This is an increase of $15 for the year. The total amount paid will vary across the region and increase as the capital value of your property increases.

    Examples of the general rates payable in year 1 under Option 2 are:

    TABLE In year 1 under Option 2, a property in Central Otago with a capital value of $350,000 would pay general rates of $65.90, a capital value of $700,000 would pay $99.75, a capital value of $1,000,000 would pay $128.77, and a capital value of $4,000,000 would pay $418.95. The median capital value in Central Otago is $550,000 which gives a median general rate of $85.24. In Clutha a property with a capital value of $350,000 would pay general rates of $69.62, a capital value of $700,000 would pay $107.20, a capital value of $1,000,000 would pay $139.41, and a capital value of $4,000,000 would pay $461.52. The median capital value in Clutha is $300,000 which gives a median general rate of $64.26. In Dunedin a property with a capital value of $350,000 would pay general rates of $86.95, a capital value of $700,000 would pay $141.86, a capital value of $1,000,000 would pay $188.93, and a capital value of $4,000,000 would pay $659.57. The median capital value in Dunedin is $450,000 which gives a median general rate of $102.64. In Queenstown Lakes a property with a capital value of $350000 would pay general rates of $63.59, a capital value of $700000 would pay $95.14, a capital value of $1000000 would pay $122.18, and a capital value of $4000000 would pay $392.60. The median capital value in Queenstown Lakes is $900000 which gives a median general rate of $113.17. In Waitaki a property with a capital value of $350,000 would pay general rates of $66.60, a capital value of $700,000 would pay $101.16, a capital value of $1,000,000 would pay $130.78, and a capital value of $4,000,000 would pay $426.99. The median capital value in Waitaki is $350,000 which gives a median general rate of $66.60.


  • Proposal 3: Funding the rehabilitation of Lake Hayes

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    Funding the rehabilitation of Lake Hayes


    What’s wrong with Lake Hayes?

    Otago generally has good water quality in our lakes and rivers, however there are some waterbodies that have degraded. Over the next 10 years we plan to work closely with communities, at a water catchment level, to improve the quality of our precious waterways.

    Lake Hayes is one of these degraded waterbodies. Located near Queenstown, it’s a national treasure, known as one of the most photographed lakes in New Zealand. However, over the last 70 years this lake has suffered from a build-up of nutrients from human activity, including:

    • Historic fertiliser application
    • Industry development
    • Septic tank effluent
    • The removal of wetlands and riparian plantings

    As a result, Lake Hayes now suffers from periodic algal blooms caused by the build-up of the nutrient phosphorous, which is in lakebed sediment.

    We’ve been working with the local community to improve its water quality and have three options for how we propose to fund the work ahead.

    Communities in Otago have also said they want to improve other degraded waterbodies, and we have prioritised Tomahawk Lagoon and Lake Tuakitoto to follow Lake Hayes. It is important to note that this funding proposal only relates to Lake Hayes.

    Photograph of Lake Hayes and the surrounding mountains in winter.


    What do we need from you?

    We have a decision to make about how to fund the ongoing work to improve Lake Hayes. We’ve put together three funding options and let you know our preferred option based on the factors outlined below. Your feedback is an important part of making this decision so let us know what you think.


    FUNDING CONSIDERATIONS

    There are some important considerations that we’ve made in developing this proposal. They include:

    • Scale of work – it is likely to be large, involving infrastructure that requires ongoing maintenance (total spend is estimated at $3.5M over the 10-year plan)
    • Who benefits from the work? Is it the entire region, any identifiable part of the community, or individuals?
    • When are the benefits expected to be seen?
    • How we fund other infrastructure

    To support the consideration of who benefits, an external company completed an economic benefits assessment for us. The map below gives a geographic view of the benefits.


    MAP + TABLE Map of Otago with a table showing the geographic distribution of benefits of improved water quality. Area 1 is Lake Hayes with a 40% proportion of benefits, area 2 is Lake Hayes South which includes Lake Hayes Estate and Shotover Country and would receive a 30% proportion of benefits, area 3 includes all Queenstown Lakes District residents who would get a 15% share of benefits, area 4 is all Otago residents who would get a 7.5% share of benefits, and area 5 represents everyone outside of Otago including national and foreign tourists who would also get a 7.5% share of benefits.


    View rating map


    What are the options?

    We’ve prepared three funding options for you to consider. Let us know which option you like best:


    Option 1 (PREFERRED)

    New targeted rate for Lake Hayes.

    Create a new targeted rate for Lake Hayes. This is based on the economic benefits assessment. Under this option:

    • 70% of the funding will come from the benefit zones of Lake Hayes and nearby residents (Lake Hayes Estate and Shotover Country)
    • The residents closer to Lake Hayes enjoy more benefit and therefore pay more of the funding requirement to rehabilitate the lake
    • There are smaller benefits to and funds payable by the wider district and region


    Option 2

    Fund via existing river and water management targeted rate.

    Use the existing river and water management targeted rate to fund this work. Key points to note include:

    • Funding is allocated across the entire Queenstown Lakes district and includes both the Wakatipu and Wanaka river and water management rating zones
    • This option only includes the Queenstown Lakes district as this rating method is more suited for smaller operational funding requirements that generally do not need broader funding support from other districts and/ or the wider region
    • This option reflects a benefit-based approach and is used for funding other service delivery and implementation activities like flood protection and drainage schemes, biodiversity initiatives including Predator Free Dunedin, and harbour management, where the cost is funded by the district where that activity occurs

    This is not our preferred option as the economic benefits assessment shows a district-wide approach is inequitable when there is a concentrated benefit to a defined localised area.



    Option 3

    New uniform targeted rate.

    Create a new uniform targeted rate, spreading the cost evenly across every ratepayer in Otago. Under this funding option:

    • Funding is allocated across the entire Otago region
    • Under the uniform targeted rate the cost of work is allocated evenly across every rating unit in the region – every property pays the same amount
    • This option is inconsistent with the benefit-based approach we use for funding other service delivery and implementation activities
    • While this appears similar to the Wilding Pine uniform targeted rate, the benefits of wilding pine control are not localised to specific areas and control is undertaken to prevent further spread throughout all of Otago

    This is not our preferred option as it is inconsistent with existing funding policies and will result in a disproportionate amount of funding burden placed on those who receive little benefit.






    How much will each option cost you?

    TABLE Under Option 1 which is our preference, there would be a new targeted rate based on capital value. The 290 ratepayers in Lake Hayes would pay 39.5% of the allocated cost with an average rate of $334.86, the 1569 ratepayers in Lake Hayes South would pay 28.9% of the allocated cost with an average rate of $45.35, the 27,239 ratepayers in the Queenstown Lakes District would pay 23.9% of the allocated cost with an average rate of $2.16, and the remaining 119,389 ratepayers in Otago would cover the remaining 7.7% of the allocated cost with an average rate of $0.16. Option 2 would be funded via the existing river and water management targeted rate. The ratepayers of the Queenstown Lakes district would pay 100% of the cost with an average rate of $9.03. Option 3 would be funded by a new targeted uniform rate where everyone in Otago pays the same rate of $2.17.

    NOTE: above numbers are average for Options 1 and 2 – actual will vary depending on CV. Option 3 is based on a uniform rate and will only apply to 113,000 contiguous rate units. For all three options the total rates amount is $214,000 (for year 1).

  • Our must-do projects

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    Our must-do projects


    Climate change

    Climate change is an issue of international importance and is the subject of emerging national direction.

    Working together and being proactive are key to effective response. With the benefit of our Otago Climate Change Risk Assessment, and our region-wide and inhouse emission inventories underway or almost completed, we are progressing right across the organisation to plan and respond to climate change.

    Our immediate priorities, particularly Otago’s freshwater, means we have maintained our resource levels associated with climate change over the short-term, and there is an expectation the level of work will build over the long-term. Importantly, we would like to partner regionally on our approach to climate change.

    WE CONSIDER CLIMATE CHANGE IN EVERYTHING WE DO.





    Environment


    LAND, WATER AND BIODIVERSITY

    When it comes to managing water, land and our biodiversity priorities we need the best possible information. This means we need to invest more in our monitoring networks and environmental studies.



    AIR

    We’re pausing most of our air quality work – except for monitoring – over the next two years to reduce the rates increase in year 1.




    Safety and resilience

    Risk management and building resilience is a key focus for ORC. The challenge is to support our communities to understand the implications of risk and to make informed decisions.




    Transport

    Supporting economic growth and connecting communities and businesses.




    Regional leadership

    We’re investing more in partnering with Kāi Tahu, in community engagement, and in responding to regional issues such as urban development and climate change.



    Environment


    Land and water

    We need to understand Otago’s environment better.

    When it comes to managing water, land and our biodiversity priorities we need the best possible information. This means we need to invest more in our monitoring networks and environmental studies.

    We're planning to:

    • Establish new monitoring programmes, especially in estuaries and coastal waters
    • Build a better understanding of the effect of land use on water
    • Expand our current freshwater monitoring network to give effect to national legislation
    • Work towards meeting the monitoring requirements for indigenous biodiversity

    Our communities also need easy access to reliable, comprehensive information about Otago’s environment, including our catchments. We’ll be redesigning the way we share information about our environment to make sure that it’s good quality, well communicated and well used.


    Everything is interconnected in nature. That’s why we’re transitioning towards integrated catchment management.


    From 2023-24, we’ll begin to facilitate the preparation, implementation and review of integrated catchment action plans in collaboration with local communities, catchment groups, mana whenua and other interested parties.

    Integrated catchment action plans will mean:

    • We have a set of compatible catchment objectives for freshwater, biodiversity, pest management, natural hazard risks and climate change adaptation in Otago’s catchments
    • The community, mana whenua, ORC, catchment groups, government bodies and non-governmental organisations (NGOs) will collaborate to develop a road map to achieve catchment objectives
    • Environmental initiatives in Otago’s catchments will be well-coordinated across all parties
    • ORC’s interventions in catchments will be well targeted

    Over time these plans will drive ORC’s work programme managing freshwater, biodiversity, biosecurity, natural hazards risks and climate change.


    In the meantime, we’re strengthening our land and water management.


    We recognise how important Otago’s lakes, rivers, wetlands, aquifers and coast are to the region’s identity and wellbeing.

    We're continuing our work programme to review and notify the Regional Plan: Water by 2023. The plan sets out policies and rules to protect the important values of water. It will align Otago with national legislation on freshwater management. Our review process will continue to engage local communities, mana whenua and key stakeholders.

    This LTP also consolidates our unplanned increase in capacity to regulate our current regional plans, particularly water. The increase occurred in 2020-21 following external and internal reviews that resulted in increasing our consenting and consent monitoring teams. The regulatory activity has also been supported by plan changes that improve direction and clarity for us and our consent holders.

    The Regional Plan: Coast, which seeks to protect coastal values, will be reviewed and notified in 2025-2026.

    While all of this is happening, we’ll continue to support catchment groups in their efforts to improve Otago’s water. Our ongoing support for the community will include advising land managers on best management practices and on how to comply with new national legislation (including obligations to prepare farm environment plans).


    Biodiversity

    We’re listening to the community’s concerns about biodiversity, our leadership role and level of service.

    All aspects of our approach to biodiversity and biosecurity will be strengthened over the next 10 years. This includes planning, science and monitoring, activities such as restoration and threat management, and community awareness and engagement.

    We will:

    • Facilitate a regional biodiversity hui and strategy
    • Increase our knowledge and develop a monitoring framework and research programme
    • Increase our commitment to and expenditure for pest management such as possums, and completion of a freshwater lakes management plan, and regional wilding pine management strategy
    • Continue to and over time increase our support for local community biodiversity projects through the ECO Fund and support for Catchments Otago
    • Progressively integrate biodiversity protection and restoration into farm support programmes and, in the longer term, into farm environment plans


    Air

    We’re pausing most of our air quality work – except for monitoring - over the next two years. Beyond that, we’ll be striving to develop more effective solutions to manage air pollution in Otago.

    Funding pressures and other priorities mean most of our air quality work (except for air quality monitoring and scientific analysis) will be paused from July 2021 to June 2023.

    However, Otago faces significant air pollution challenges in winter, especially in Arrowtown, Clyde, Cromwell, Alexandra and Milton. Most emissions are from home heating.

    In the past, we’ve addressed air pollution through an air quality programme that included providing subsidies for cleaner heating options. Although emissions from home heating have significantly reduced, we have not met the national standards for air quality.

    As a result, we need to rethink our approach, review our policies and rules on air emissions, and implement a new, more effective air quality programme.

    From 2023-24, we’ll swing into action to develop and implement an effective air quality programme that focuses on strengthening rules on air emissions, and on working with local communities and partners for better housing and cleaner air.


    ENVIRONMENT TABLE SHOWING WHO PAYS IN YEAR 1 In the first year of the Long-term Plan it is expected our work on the environment will cost $25,425,000. Funds for this work programme are split between the following: General rates with $13,875,000 Targeted rates with $3,309,000 Fees and charges with $200,000 Grants with $3,877,000 Other income with $964,000 Reserves with $3,200,000 ENVIRONMENT BUDGETED EXPENDITURE GRAPH This graph show expenditure in this area increasing over the next 10 years. Year 1 spend is $25,425,000. Year 2 spend is $27,512,000. Year 3 spend is $28,501,000. Year 4 spend is $30,756,000. Year 5 spend is $32,107,000. Year 6 spend is $34,687,000. Year 7 spend is $35,829,000. Year 8 spend is $36,743,000. Year 9 spend is $37,548,000. Year 10 spend is $38,399,000.



    Safety and resilience


    Risk management and building resilience is a key focus for ORC. The challenge is to support our communities to understand the implications of risk and to make informed decisions.

    Our priority focus areas for the next 10 years in safety and hazards are flood protection, drainage control and river management. Climate change is a critical and related issue. We’ll develop a comprehensive spatial approach to natural hazard risks to inform future priorities, at the same time as undertaking specific projects for the risks we already know about.

    Our proposed LTP contains an Infrastructure Strategy. It identifies the flood and drainage schemes that we manage and highlights six key issues that influence the services we provide. From these issues we understand that:

    • There is complexity that needs to be better understood about how climate change and development impacts on catchments
    • We need to improve our asset management planning to better understand how change impacts on our service and the decisions the community faces
    • Our plan to maintain service levels is shadowed by uncertainty about our communities’ expectations regarding managing changing risk (e.g. climate change impacts) and the associated costs

    We work collaboratively on these issues with government, city and district councils, and technical advisory groups.

    Our plan is to maintain current services and address the issues outlined above. Key components of work include:

    • Climate change adaptation investigations
    • Taieri and Clutha flood protection scheme reviews
    • Flood damage repair programmes
    • Asset management improvements
    • Pump station infrastructure and technology improvements
    • Fish passage adaptation investigations


    SAFETY AND RESILIENCE TABLE SHOWING WHO PAYS IN YEAR 1 In the first year of the Long-term Plan it is expected our work in this area will cost $17,500,000. Funds for this work programme are split between the following: General rates with $3,116,000 Targeted rates with $9,611,000 Fees and charges with $408,000 Grants with $1,700,000 Other income with $736,000 Reserves with $1,929,000 SAFETY AND RESILIENCE BUDGETED EXPENDITURE GRAPH This graph show expenditure in this area over the next 10 years. Year 1 spend is $17,500,000. Year 2 spend is $18,976,000. Year 3 spend is $18,103,000. Year 4 spend is $18,155,000. Year 5 spend is $18,585,000. Year 6 spend is $18,218,000. Year 7 spend is $20,269,000. Year 8 spend is $18,090,000. Year 9 spend is $18,314,000. Year 10 spend is $19,557,000.



    Transport


    Otago’s regional transport system, including public transport, aims to support economic growth and connect communities and businesses.

    Our Regional Land Transport Plan (RLTP) shapes decisions and actions about Otago’s land transport system. The RLTP’s strategic direction reflects central government’s direction, who in addition want to:

    • Improve accessibility to transport and create more choice in how we travel
    • Reduce the impacts of transport on climate change
    • Improve urban environments and public health
    • Reduce deaths and serious injuries

    We are engaged in a planning process with Waka Kotahi NZ Transport Agency that will influence future expenditure and funding decisions we make over the next 10 years. As part of this process we’re completing a new Regional Land Transport Plan (RLTP) 2021-31, which is required by 30 June 2021.

    We’re responsible for providing sustainable, safe and inclusive transport that connects our community.

    We contract operators to provide bus services in Dunedin, bus and water ferry services in Queenstown, and to provide the Total Mobility scheme. Orbus, our public transport network, is our largest work programme.

    Our LTP supports this strategic direction by outlining how we will continue to improve Otago’s public passenger transport services. This includes planning, working with partners on the long-term vision for public transport across the region and on the delivery of infrastructure that supports public transport services in Dunedin and Queenstown, and renewing contracts (with service improvements) for Dunedin and Queenstown public transport services as required.

    The next 10 years will be a challenging but exciting period for our public transport system as it responds to changes from population growth and movement, to shifting economic drivers due to COVID-19. Technology is improving and more accessible, at the same time we have national goals to lower carbon emissions. Public transport will need to be the preferred mode of travel for more people more often to support our economy and contribute positively to our environment and communities.

    An example included in this LTP is the funding for a business case to significantly improve public transport in Queenstown. It's part of the Way To Go programme of integrated and complementary land transport projects supported by our councillors. They are designed to create an enduring, safe and affordable transport system that offers more accessible and convenient travel options.

    We also need to be able to deliver a high-quality service whilst remaining financially sustainable for our customers, ratepayers and our funding partners. Investment in the network needs to be at a rate our communities can afford. The LTP assumes we'll achieve existing funding levels from Waka Kotahi of 51%. If this funding support is not achieved it will impact on future services, bus fares, and/or rates.


    TRANSPORT TABLE SHOWING WHO PAYS IN YEAR 1 In the first year of the Long-term Plan it is expected our work in this area will cost $32,451,000. Funds for this work programme are split between the following: General rates with $745,000 Targeted rates with $7,290,000 Fees and charges with $250,000 Grants with $12,985,000 Fares/other income with $8,517,000 Reserves with $2,664,000 TRANSPORT BUDGETED EXPENDITURE GRAPH This graph show expenditure in this area over the next 10 years. Year 1 spend is $32,451,000. Year 2 spend is $35,406,000. Year 3 spend is $37,255,000. Year 4 spend is $44,393,000. Year 5 spend is $42,575,000. Year 6 spend is the same at $42,575,000. Year 7 spend is $44,215,000. Year 8 spend is $44,312,000. Year 9 spend is $45,428,000. Year 10 spend is $46,328,000.


    Regional leadership



    We’re investing more in partnering with Kāi Tahu, in community engagement, and in responding to regional issues such as urban development and climate change.

    Supporting governance, good decision-making, and connecting and engaging with our communities are all aspects of our work.

    We’re investing in strengthening our partnership with Kāi Tahu and will be working to integrate Matauranga Kai Tahu into our way of working and decision making. We are also investing in improving our engagement approach and capability across the organisation, including partnering with our communities to develop plans for protecting and managing waterways, and rabbit control work.

    We’ll continue to support the Mayoral Forum and we’ll do more to identify and develop our understanding of broader regional wellbeing issues. This will enable us to respond in the best way possible to community needs. Wherever possible our responses will be developed in partnership with communities and stakeholders.

    We provide direction on resource management to Otago’s city and district councils. This includes continuing our review of the Regional Policy Statement. Meanwhile, we will increasingly be involved in urban development, as required by national legislation.


    As part of our role in regional leadership, we consider climate change in everything we do.


    Our immediate priorities, particularly Otago’s freshwater, means we have maintained our resource levels associated with climate change over the short-term, and there is an expectation the level of work will build over the long-term. Importantly, we would like to partner regionally on our approach to climate change.


    REGIONAL LEADERSHIP TABLE SHOWING WHO PAYS IN YEAR 1 In the first year of the Long-term Plan it is expected our work in this area will cost $21,622,000. Funds for this work programme are split between the following: General rates with $15,556,000 Targeted rates with $188,000 Fees and charges with $5,300,000 Grants with $75,000 Other income with $270,000 Reserves with $233,000 REGIONAL LEADERSHIP BUDGETED EXPENDITURE GRAPH This graph show expenditure in this area over the next 10 years. Year 1 spend is $21,622,000. Year 2 spend is $22,917,000. Year 3 spend is $23,848,000. Year 4 spend is $24,524,000. Year 5 spend is $25,474,000. Year 6 spend is $25,879,000. Year 7 spend is $26,464,000. Year 8 spend is $27,472,000. Year 9 spend is $27,891,000. Year 10 spend is $28,615,000.


  • How much & on what?

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    How much & on what?


    We are expecting our total spend in year 1 to be just under $97 million.


    Here’s a breakdown by work area:



    Environment

    This group of activities works to achieve the sustainable use of our water, land, air and coast. It also includes protecting our unique biodiversity and implementing our regional pest plan. The delivery of our land and water framework is a priority and this makes up the majority of the spend increase in year 1, with a focus on increasing our science and monitoring capacity. Our biosecurity proposal and establishing a biodiversity monitoring programme accounts for further increases in this area. Wilding pine control spend has increased as well - this is covered by government grants.

    $9,864,992 increase from 2020-21 budget



    Safety and resilience

    To ensure our communities are kept safe, we identify and monitor natural hazards, manage flood protection and drainage schemes, provide harbourmaster services, and support Otago Civil Defence and Emergency Management. While our flood protection and drainage schemes make up most of the expenditure in this area, there is also increased expenditure in years 1 and 2 for identifying and monitoring natural hazards and for climate change adaptation studies.

    $1,339,643 increase from 2020-21 budget



    Transport

    We’re responsible for public transport in Otago and provide services in Dunedin and Queenstown. We offer the Total Mobility scheme to meet the needs of people unable to use public transport. We also facilitate wider transport projects in Otago. The increased expenditure spans both Dunedin and Queenstown services, with the latter including funding for business case work for improving the future services and associated infrastructure.

    $3,642,410 increase from 2020-21 budget



    Regional leadership

    We have a responsibility to promote environmental, economic, social and cultural wellbeing across the region and engage and work in partnership with our partners and communities to do this. This group of activities also includes regional planning and regulatory service that provide elected leadership with an important lever to effect change in Otago. The increased spend is largely associated with a significant and required increase in staff to deliver a regulatory consenting activity that fits with Otago's needs. The increase also reflects more capacity for our regional planning activity.

    $4,871,856 increase from 2020-21 budget


    Here’s how it looks over the next 10 years. We included the current year for comparison:


    TABLE – 10 years of proposed spending This table breaks down the proposed spend over the next 10 years by the four work areas: environment, safety and resilience, transport, and regional leadership. Line one shows expenditure on environment over the next 10 years. Current year is $15,560,000. Year 1 spend is $25,425,000. Year 2 spend is $27,512,000. Year 3 spend is $28,501,000. Year 4 spend is $30,756,000. Year 5 spend is $32,107,000. Year 6 spend is $34,687,000. Year 7 spend is $35,829,000. Year 8 spend is $36,743,000. Year 9 spend is $37,548,000. Year 10 spend is $38,399,000. Line two shows expenditure on safety and resilience over the next 10 years. Current year is $16,161,000. Year 1 spend is $17,500,000. Year 2 spend is $18,976,000. Year 3 spend is $18,103,000. Year 4 spend is $18,155,000. Year 5 spend is $18,585,000. Year 6 spend is $18,218,000. Year 7 spend is $20,269,000. Year 8 spend is $18,090,000. Year 9 spend is $18,314,000. Year 10 spend is $19,557,000. Line three shows expenditure on transport over the next 10 years. Current year is $28,808,000. Year 1 spend is $32,451,000. Year 2 spend is $35,406,000. Year 3 spend is $37,255,000. Year 4 spend is $44,393,000. Year 5 spend is $42,575,000. Year 6 spend is the same at $42,575,000. Year 7 spend is $44,215,000. Year 8 spend is $44,312,000. Year 9 spend is $45,428,000. Year 10 spend is $46,328,000. Line four shows expenditure on regional leadership over the next 10 years. Current year is $16,749,000. Year 1 spend is $21,622,000. Year 2 spend is $22,917,000. Year 3 spend is $23,848,000. Year 4 spend is $24,524,000. Year 5 spend is $25,474,000. Year 6 spend is $25,879,000. Year 7 spend is $26,464,000. Year 8 spend is $27,472,000. Year 9 spend is $27,891,000. Year 10 spend is $28,615,000. The final line sums the total spend for each financial year. Current year is $77,278,000. Year 1 total is $96,997,000. Year 2 total is $104,811,000. Year 3 total is 107,707,000. Year 4 total is $117,828,000. Year 5 total is $118,741,000. Year 6 total is $121,359,000. Year 7 total is $126,777,000. Year 8 total is $126,617,000. Year 9 total is $129,181,000. Year 10 total is $132,899,000.

    A stacked bar graph with a visual representation of the proposed spending over the next ten years with the current year (2020 to 2021) as comparison.



  • Who's paying for it?

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    Who's paying for it?


    While your rates go a long way toward paying for the work we do, we don’t expect you to pay for everything. Some of our funds come from other sources.


    This is how we expect to cover our costs in year 1 of our Long-term Plan:


    TABLE – 10 years of spending Table showing from whence the council expects to receive income. General Rates $19364000, Targeted Rates $20398000, Grants $18637000, Other income (for example bus fares) $10487000, Fees and Charges $6158000, Reserves $8025000, Dividends and Investments $13928000. This would provide a total income in year one of $96997000. Pie graph with the title "Total Income $97million in 2021 to 2022" giving a visual representation of the table on this page that shows year 1 income sources. General Rates $19364000, Targeted Rates $20398000, Grants $18637000, Other income (for example bus fares) $10487000, Fees and Charges $6158000, Reserves $8025000, Dividends and Investments $13928000.


    Here’s how it looks over the next 10 years. We included the current year for comparison:


     A stacked bar graph with a visual representation showing how we expect to cover costs over the next ten years with the current year (2020 to 2021) as comparison. Funds come from seven different sources: general rates, targeted rates, grants, other income, fees and charges, dividends and other investment income, and reserves.  The current year shows income from general rates $11,180,000, targeted rates $15,777,000, grants $11,474,000, other income $10,770,000, fees and charges $5,050,000, reserves $12,012,000 and income from dividends and investments $11,015,000.  Year 1 shows income from general rates $19,365,000, targeted rates $20,398,000, grants $18,637,000, other income $10,488,000, fees and charges $6,158,000, reserves $8,025,000, and income from dividends and investments $13,928,000. Year 2 shows income from general rates $22,407,000, targeted rates $24,112,000, grants $18,288,000, other income $10,767,000, fess and charges $6,741,000, reserves $7,569,000, and income from dividends and investments $14,928,000. Year 3 shows income from general rates $23,920,000, targeted rates $27,539,000, grants $17,490,000, other income $11,707,000, fees and charges $7,216,000, reserves $3,908,000, and income from dividends and investments $15,928,000. Year 4 shows income from general rates $23,847,000, targeted rates $29,965,000, grants $22,587,000, other income $12,501,000, fees and charges $7,548,000, reserves $4,453,000, and income from dividends and investments $16,928,000. Year 5 shows income from general rates $23,248,000, targeted rates $32,908,000, grants $22,558,000, other income $12,985,000, fees and charges $7,754,000, reserves $1,362,000, and income from dividends and investments $17,928,000. Year 6 shows income from general rates $23,415,000, targeted rates $34,191,000, grants $24,165,000, other income $13,482,000, fees and charges $7,961,000, reserves negative $782,000, and income from dividends and investments $18,928,000. Year 7 shows income from general rates $24,316,000, targeted rates $36,259,000, grants $24,773,000, other income $13,993,000, fees and charges $8,170,000, reserves negative $161,000, and income from dividends and investments $19,428,000. Year 8 shows income from general rates $24,646,000, targeted rates $37,024,000, grants $24,776,000, other income $14,529,000, fees and charges $8,387,000, reserves negative $2,662,000, and income from dividends and investments $19,928,000. Year 9 shows income from general rates $25,128,000, targeted rates $38,329,000, grants $25,283,000, other income $15,080,000, fees and charges $8,606,000, reserves negative $3,674,000, and income from dividends and investments $20,428,000. Year 10 shows income from general rates $26,022,000, targeted rates $39,483,000, grants $25,670,000, other income $15,646,000, fees and charges $8,827,000, reserves negative $3,676,000, and income from dividends and investments $20,928,000.


  • How much do you pay?

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    How much do you pay?

    You pay two different types of rates - general rates are charged to every property in Otago and then there are targeted rates which apply to specific locations or activities. These are much harder to compare so the map below shows proposed general rates only. These examples are for a property of mid-range capital value in each district.

    As a rule of thumb, the increases stay in proportion to your property’s CV. The rates bill you receive from us later this year will differ as it will include targeted rates, and your final rates are dependent on the outcomes of what you tell us in this consultation.