$10 million loan for Waimea dam
The Waimea dam project has received a boost in the form of a likely $10 million interest-free loan.
Primary Industries Minister Nathan Guy flew into Nelson on Monday to announce a change to the constitution of Crown Irrigation Investments Ltd that allows it to provide concessionary loans to local authorities for projects that ‘‘directly lead to environmental benefits’’.
Guy indicated the proposed $82.5m Waimea dam was just such a project.
The change enables Tasman District Council to negotiate a $10m interest-free loan from Crown Irrigation for the environmental benefit component of the proposed dam in the Lee Valley, near Nelson.
It means $10m of the council’s estimated capital contribution of $25m to $28m will likely be interest free, providing an expected saving to ratepayers of about $500,000 a year in interest costs.
It is likely to make the project more palatable around the council table where some councillors have expressed concerns about the affordability of the proposed dam for ratepayers.
The announcement comes just three days before councillors are due to go behind closed doors to consider a new funding proposal for the project.
Nelson MP Nick Smith, Tasman district mayor Richard Kempthorne and TDC chief executive Lindsay McKenzie were on the banks of the Waimea River to hear the announcement.
Kempthorne said it was ‘‘fantastic news’’.
‘‘One of the issues that has really challenged my council politically is the expectation that the ratepayers would have to fund most, if not all, of the costs of providing the dam’s environmental flow and general community benefits,’’ Kempthorne said.
‘‘I’m sure it will allay the fears of those around the council table who were concerned about the fairness of the earlier proposal and I’m now anticipating full support from council.’’
McKenzie said the scheduled council meeting tomorrow was a ‘‘critical day’’.
‘‘We’re putting the overall package including the $10m concessionary loan to the council and asking them the question whether or not they’re prepared to go to consultation on that funding proposal,’’ he said.
Smith said he had been aware of the pressure around trying to find an agreeable funding model for the Waimea dam ‘‘and have been requesting that Nathan make as quickly as possible progress on this issue to open the door for Crown Irrigation to provide this additional support’’.
The Waimea River regularly had algae blooms when the weather was dry and the flows were low, Smith said.
‘‘The only practical way that we can make this river clean is to proceed with the dam,’’ he added.
‘‘The alternative is to cut the guts out of Nelson’s horticultural industries. That will have impacts of literally hundreds and hundreds of jobs as well as huge income to the region and that is why I argue the dam is the best prospect to deliver both economic gains for the horticultural sector, provide for the water supply that’s required for the growth in housing at Richmond as well as the best prospect of reducing the pollution in the river.’’
Guy said the Waimea dam had economic, social and environmental benefits. ‘‘Social being the water that’s going to flow through to local communities for drinking and the environmental is five times the minimum flow [in the Waimea River]. So this is a winwin-win all round.’’