Buyout of flood-hit homes set to proceed

Auckland councillors vote to accept Govt’s $2b cost-sharing package

Auckland councillors have unanimously voted to accept the proposed $2 billion cost-sharing buyout package for hundreds of uninhabitable properties and other storm-related costs with the Government.

It includes the buyout of about 700 Category 3 homes at a cost of $774 million, and $390m towards fixing roads and bridges affected by the Anniversary Weekend storms and Cyclone Gabrielle.

Yesterday’s decision followed an earlier vote to endorse the deal in principle, subject to consultation with Aucklanders. In the consultation process, 83 per cent of submitters supported the deal.

Those who did not support accepting the funding generally opposed the buyout of category 3 properties, feeling this should be property owners’ responsibility, covered by insurance payments or government responsibility.

The largest cluster of affected homes is in the West Auckland suburbs of Ra¯nui, Swanson and Henderson and coastal communities of Piha, Karekare and Muriwai. Other clusters are in Milford and Ma¯ngere.

The deal also includes significant Crown support for the council’s Making Space for Water initiative, which includes buying properties in floodprone areas, taking out stormwater pipes and recreating the original streams, culvert and bridge upgrades and overland flow path management.

“As Mayor, I am particularly focused on the fix-up work required to make our region more resilient to future weather events,” said Mayor Wayne Brown. “This deal will enable us to move faster on those plans, rolling out the Making Space for Water programme and reinstating a range of transport infrastructure to help our communities return to a sense of normal.”

Category 3 homes in sites identified for “daylighting streams” will be bought as part of the buyout programme, but the bill for purchasing other properties will be met by the council.

Areas identified for storm resilience include the Wairau Creek on the North Shore, the Waimoko, Opanuku, and Porters streams in West Auckland, Coxs Creek in Grey Lynn, and Harania Creek and Te Ararata Greenway in Ma¯ngere.

Auckland Council’s governing body also made decisions yesterday about how it was going to undertake the process of buying out Category 3 properties.

Under the details of the agreed approach, insured Category 3 homeowners will be offered 95 per cent of the pre-flood market value of their property. The remaining 5 per cent of the property value will operate like an insurance excess.

Meanwhile, uninsured Category 3 property owners will be offered at least 80 per cent of the pre-flood market value of their property, which may be increased up to a maximum of 95 per cent subject to considering the special circumstances of those owners.

Brown said that a fair balance had to be struck.

“Eight months on from the floods, many Aucklanders are still dealing with that devastation. We have agreed to the Government’s proposal to give them a helping hand out of it. That is the right thing to do.

“On the other hand, we are asking all Auckland ratepayers to pay higher rates to make this happen. They will be paying off the debt associated with this decision for decades. I feel the weight of that responsibility. We are also on a fixed budget and had to make decisions which gave us some confidence we could complete this process within the budget.”

West Auckland is Flooding (WAIF) spokesperson Lyall Carter said the decision was great news for floodaffected west Aucklanders.

“This is a fight that we’ve been in not only for the last nine months but a lot of our people have been in this fight for years.”

The January weather event in west Auckland came after floods in 2021 during a Covid-19 level three lockdown.

“Our community have been fighting for nearly two years for justice and for flood mitigation to be put in place so that future generations don’t have to go through what we have endured.”

Carter said despite yesterday’s decision, there was still a lot more advocacy to be done.

There was still a real question around Category 2 homes as the indication from insurers was that there was a possibility owners would not get insurance, he said.

Finance Minister Grant Robertson earlier said $877 million would come from the National Resilience Plan towards Auckland’s recovery from the summer storms.

He said the council had applied for a further $200m for road and other transport repairs, bringing the total Crown funding to $1.1b.

“I am pleased we have reached this agreement so Auckland Council can provide certainty for the people whose properties, or those close to theirs, were severely damaged by landslides or flooding.

“The Government will contribute up to $387m to support Auckland Council to purchase Category 3 residential properties. This equates to 50 per cent of the net cost, which is the same agreement for Gisborne District Council and Hawke’s Bay councils. The net cost is the agreed buyout value for each property, less any insurance payments the homeowner receives.”

The Government is also contributing $380m of the capital cost of the Making Space for Water projects.

Brown said that the approach must not be seen as a precedent for future buyouts.

“As a council, we do not and cannot insure private properties against the hazards of coastal erosion and climate change. Rates are not insurance premiums.”

Auckland Council expects to start discussions with Category 3 homeowners on buyouts towards the end of October.