Property Council's Top Five Local Government Priorities
With local government elections taking place later this year, Property Council has released our top five priorities that councils across the country need to focus on to enable development and help shape cities and regions where communities thrive.
#1: Introduce alternative funding mechanisms
Growth councils across New Zealand are close to reaching their debt and borrowing limits. Currently, councils rely on rates, rates differentials and development contributions for funding. This creates a burden for commercial property owners, who are left paying the lion’s share with little in return.
Councils must introduce new funding tools to ensure our cities are properly and sustainably funded. This could include looking into alternative funding mechanisms such as targeted rates and special purpose vehicles. Property Council supports funding methods which are equitable, transparent and specific so that contributors are also beneficiaries.
#2: Better align infrastructure and development plans
A historic lack of investment in infrastructure and a growing population has caused our cities and regions to reach crisis point. Councils across New Zealand are releasing land for development but in many cases have no plan for how and when the necessary supporting infrastructure can be funded. This poses the risk of creating pocket developments with no connection to neighbouring communities.
Councils should embrace and support growth through better alignment of their infrastructure and development plans. We encourage local government to adopt alternative funding tools such as special purpose vehicles, which spread infrastructure costs over a longer term. We also support targeted rates, which are transparent and specific to a particular purpose or project, particularly in new developments or expanding areas. Property Council supports cohesive plans that link infrastructure and development, creating cities where our communities thrive.
#3: Speed up consenting timeframes
Consenting delays increase project costs. We face an industry-wide issue where councils hold all the risk and liability, effectively acting as the ‘last man standing’. As a consequence, councils continue to be risk adverse, causing delays to the issuing of building and resource consents, resulting in significant cost delays for those investing in the city or region.
We urge councils to work with central government and the Ministry for Business, Innovation and Employment (MBIE) on the Building Legislative Reform Programme and request council liability be capped at 20% for a fairer allocation of risk and liability.
#4: Rejuvenate Central Business Districts (CBDs)
Decades of underinvestment in infrastructure and asset management has resulted in aging buildings that are often unsafe and not-fit-for purpose. New Zealand’s seismic issues have also added to this problem, with questions raised over the resilience of aging infrastructure.
Councils need to plan to enable CBD intensification. CBDs which thrive create communities where people can live, work, play and shop with ease. Plan changes to enable intensification in areas that have capacity for growth is important – particularly in the heart of our cities Councils need an effective asset management plan that makes continual improvements to buildings under their management.
#5: Collaborate with central government and key stakeholders
Councils have limited resources and often require additional financial support for larger projects (such as transport) from central government. Councils tend to work in silos, isolating themselves from early engagement and consultation with key stakeholders.
Councils should engage more closely with central government and key stakeholders to work collaboratively on council-proposed plans and projects, and to test ideas, forecasting and data predictions. Working closely with central government and key stakeholders may unleash the potential for larger scale projects.
In the Regions
Further to the priorities above, each region also has its own individual priorities:
Congestion across the region is costing Auckland $1.3b per year in lost productivity.
Auckland Council, central government and key stakeholders need to work together to progress the much-needed large transport projects in the region.
Waikato: Development Contributions
We are concerned with the veracity of Hamilton City Council data and modelling as a basis for determining development contribution (DCs) fees. Along with the lack of transparency, there is concern that DCs are being used, in part, to fulfil funding gaps.
Development contributions should be a contribution towards capital costs, and not cost covering, which the ‘growth pays for growth’ mentality may imply. Hamilton City Council should work with the property sector and other key stakeholders when updating their development contribution policy.
Wellington: Rates Differential
We have long opposed commercial rates differentials. The Shand Report and the more recent Productivity Commission report on local government funding and financing calls for rating differentials to be abolished. Despite this opposition, Wellington City Council and Greater Wellington Regional Council have introduced or implemented higher business differentials.
The councils should commit to removing rate differentials and investigate and implement alternative funding tools.
Christchurch: CBD Rejuvenation
Lack of residential residents in the CBD and delays to the completion of the city’s anchor projects has negatively affected the rejuvenation of Christchurch’s CBD.
Christchurch City Council needs to work more closely with central government and key stakeholders to progress the much-needed anchor projects.
Queenstown: Growth Concerns with Queenstown Lakes
Queenstown Lakes Council is struggling to cope with the region’s current level of growth and is under-prepared for future forecasted growth.
Queenstown Lakes District Council needs to work more closely with central government and key stakeholders and manage their planning processes in a more integrated manner.
Dunedin: CBD Targeted Rate
Dunedin City Council are looking to rejuvenate the CBD by targeting businesses to pay more than their fair share.
Dunedin City Council needs to work more closely with central government and key stakeholders and manage their planning processes in a more integrated manner.
Make an informed decision
To assist our members with making an informed decision when voting in their local body elections, Property Council are hosting several presidential-style mayoral debates. Each candidate will have three minutes to answer each question, with topics ranging from council funding tools and consenting issues to central government and stakeholder collaboration.
To register, click below:
- TAURANGA: 12:00pm, Monday 5 August
- HAMILTON: 3:45pm, Thursday 22 August
- AUCKLAND: 3:30pm, Wednesday 28 August
- WELLINGTON: 7:00am, Thursday 5 September
Author | Katherine Wilson
With a law and arts degree from Otago University, coupled with five years’ experience as a policy analyst and policy advisor at Auckland Council and the Wellington Employers’ Chamber of Commerce, Katherine is perfectly placed to support the advocacy needs of the Wellington and Waikato Branches. Katherine is also supporting our advocacy work at a national level, including working with members on the proposed increase to fire levies.
Katherine was appointed as a Senior Advocacy Advisor in 2017, and since then has proven herself to be hugely dedicated, highly intelligent and committed to ensuring the voice of our members is heard at all levels of governance.