A tale of two storms for Nelson
A convergence of two storms has presented “no easy” decisions for Nelson City Council as it tries to plan ahead for the next 10 years.
Indeed, the consultation document that summarises the council’s proposals for the next decade is named
“Beyond the Storm”, a reference to the devastating August 2022 event that left the city with a final recovery bill of about $60 million.
However, another storm has cast its shadow over the plan’s first few years – the so called “perfect storm” of financial pressures including inflation, high interest rates, and more expensive insurance.
“There are no easy financial choices for council in the current economic environment,” mayor Nick Smith admitted in his foreword for the consultation document.
“Our challenge is to navigate a realistic and responsible financial path while ensuring we maintain and improve the services that support the city’s prosperity and wellbeing.”
So, what is that “realistic and responsible financial path” proposed to look like?
Rates
The council has proposed an average rates increase of 8.2% for the next financial year.
However, that doesn’t include the additional annual $300 storm recovery charge
on all separately used or inhabited parts of a rating unit for the next decade to pay off the $60m recovery bill.
When the rates rise and the storm recovery charge are taken as a package, that comes to an effective 15.3% rates increase for 2024-25.
That effective increase is in line with the national average rates increase of 15% signalled by Local Government New Zealand, though some districts vary significantly.
Kaikōura is proposing a 4.99% increase while Hamilton is suggesting 19.9%, though their respective regional councils are also proposing their own rates increases of 24.2% and 6%.
Nelson’s neighbour Tasman is proposing an increase of 9.6%.
The 8.2% increase for Nelson is hoped to balance continued community investment and reduced spending.
For example, the road line marking budget has been almost halved by $90,000 while the parks maintenance contract wasn’t increased for inflation, which saved $500,000. Although these measures will come with a decrease in regular road re-marking and park maintenance.
Private property buy-outs
The council is proposing to buy up to 14 private properties around Nelson “where there is an intolerable risk to life and it is not feasible to mitigate that risk” as a result of the August 2022 storm.
The Government has offered to contribute $6m to cover half of the costs, less other pay-outs.
The council would not proceed with the buy-outs without Government support.
If the council proceeded with the buyouts, it would be required to take ownership of the land and its management, including the demolition of properties.
This could potentially create $17.5m of additional costs for the council, including Nelson’s share of the buy-outs.
However, buy-out support is part of a package, so if Nelson rejected buying out the properties, it would also lose another $6m to help the council repair landslides from public land so the area is safer than it was before the slip, and $300,000 to help monitor the Tāhunanui slump – New Zealand’s largest active urban landslide.
New projects
Though the council is aiming to avoid large projects in the near future due to the difficult economic conditions, several smaller projects are still proposed to go ahead.
“A city doing nothing goes backwards,” Smith said.
The first project is a $2.7m all-weather sports turf that would be half-funded by sports codes and is expected to lessen the disruption to playing seasons by wet weather.
The second is a $3.3m surf life saving club building at Tāhunanui Beach, half-funded by the local club, as well as a $50,000 upgrade for the changing rooms on the sports ground.
The final major project is a $1.7m arts hub to provide local artists a location to create art and connect, but to also home an arts development agency to advocate and coordinate the sector.
Other factors
There are several other items that Nelsonians can consider in the proposed Long Term Plan, including the council’s transition away from commercial forestry, future decisions on Civic House and the Elma Turner Library, a major upgrade of Bridge St, recreational access to Ngāti Koata land, an east-west cycle link, a playground at Rutherford Park, a kitchen waste collection scheme, and more.
Timeline
Consultation opened on the council’s Long Term Plan on Wednesday and run until Tuesday, April 28.
Through May and June, the council will refine its plan based on public feedback before adopting a final version in time for the new financial year beginning on July 1.
The consultation document and other supporting information is available on the council’s website and at its customer service centre and libraries.