Council is setting our plans for the next nine years. Let us know, if we are on the right track and what you want to see for the future of our district.
Message from the Mayor and Chief Executive
Tēnā tātau katoa | warm greetings to you all, our community on behalf of Te Kaunihera ā rohe o Kawerau to the proposed Long Term Plan for 2025 to 2034.
We completed an enhanced annual plan last year due to the changes and uncertainty with the three waters’ legislation, Local Water Done Well. We must now complete our long-term plan for the next nine years. At the same time we will be consulting with you our community regarding the Water Service Delivery Plan for the delivery of drinking water, wastewater and storm water. More information, is detailed in the Long Term Plan Comprehensive Consultation Document and Summary Consultation Document (which we are delivering to homes). More information about Local Water Done Well and the consultation is here.
With costs at an all-time high, reviews of our services and projects has resulted in a short-term plan that sticks to ‘business as usual’. This includes continuing with the renewals of the drinking water pipes and other strategic asset replacements.
Putting it simply, the cost to provide the same level of services has increased by 8.5%.
We look forward to engaging with you, our community, about the nine-year long term plan in the coming weeks.
Ngā mihi nui,
Kahika | Her Worship the Mayor Faylene Tunui
Tumu Whakarae | Chief Executive Morgan Godfery
Contents
What we have achieved since our last Long Term Plan
Drinking Water Replacement Plan
What we are proposing for 2025 - 2026
What your rate dollar provides the community
Topic 1: Moving to targeted water and wastewater rates nine years or five years?
Topic 3: Planning for the future - Community Library and Research Centre
Background
Every three years Council is required to complete a plan for the next 10 years, the Long Term Plan. This year, Council will complete a nine-year Long Term Plan for 2025 to 2034, as we produced an enhanced Annual Plan last year.
The Long Term Plan sets our direction as a council and establishes the work we will deliver to the community over the next nine years, as well as setting out how that work will be funded, which is how Council sets the rates each year.
A Long Term Plan:
describes community outcomes for the district
describes the activities of the Council
sets out a long term focus for the decisions and activities of the Council
provides for integrated decision-making and coordination of Council resources
provides a basis for accountability to the community.
Long Term Plan’s outline all things a Council does and how they fit together. They show what will be done over the plan's 10 year period (in our case this time over nine years), why the Council is doing things and the costs.
In parallel with the Long Term Plan, Council will also be consulting on its Water Service Delivery Plan as part of Local Water Done Well, a government initiative aimed at improving water services and infrastructure across New Zealand.
What we are proposing for 2025 - 2026
Year one of the Long Term Plan
Council proposes an overall rates increase of 8.5% in the coming year that maintains our current levels of service.
- The drivers of the 8.5% overall rates increase for year one of the Long Term Plan are:
- Personnel = $456,060 or 3.1%
- Operating Costs = $412,160 or 2.8%
- Solid Waste $174,000
- Water implementation $82,000
- Depreciation Expense = $297,250 or 2.0%
- Finance Costs = $110,500 or 0.8%
- Increase in Interest Income = ($33,500 or 0.2%)
What your rates dollar provides for our community
Consultation Topics
Topic 1: Moving to targeted water and wastewater rates nine years or five years?
Local Water Done Well legislation requires Council to review the way we deliver water services to the community.
(More information about whether to keep delivering water services in-house or via a multi-Council controlled organisation is contained in the Local Water Done Well consultation document).
The Long Term Plan has been prepared on the basis of continuing with the in-house business unit (Council’s preferred option), with all revenue and expenditure on the basis it being delivered in-house.
The requirements of Local Water Done Well mean Council needs to start transitioning towards the targeted water rates funding the total delivery of water and wastewater services. The Long Term Plan proposes increasing the targeted rates gradually over a nine-year period. This is Council’s preferred option.
Is the community happy with this transition (which will have a lower rates impact) or would the community prefer this to be over a shorter five year period?
Option 1: nine-year transition
- Transition over nine years to fund the delivery of water and wastewater services.
- Residents now pay $84.50 per property for drinking water and $170 for wastewater services. This is only 15% and 23% of the total cost (respectively) with the rest funded from the general rate.
- The benefit of a longer transition is a lower impact on individual properties.
- Increasing targeted rates moves to 'user pays' so that the properties using the service are paying for that service.
Option 2: five-year transition
- Transition over a shorter five year period to fund the delivery of water and wastewater services.
- Overall, the total rate require remains the same. But a shorter timeframe will mean higher increases for lower value properties.
- Note: the increase in the targeted rates for water and wastewater is offset (in both options) by the decrease of the funds used from the general rate to fund these services.
For more information, on Local Water Done Well
Topic 2: Funding Depreciation
In 1998-99 Council began funding for depreciation of strategic assets. What this means is putting funding aside funds each year for renewing strategic assets (water, wastewater and roading assets) so that when the asset needs replacing, there is funding already available. From then, Council has been funding depreciation of strategic assets at 100% until 2022, when the revaluation of assets increased by $18 million. The increase in the value of assets meant the cost to fund depreciation at 100% became too high for the rates, and the depreciation was scaled back to 65% for strategic assets. The level of funding has continued at 65%, but the plan is to increase levels of funding so that long-term council starts to rebuild the levels.
The Long Term Plan has been prepared with 65% of depreciation being funded on Strategic Assets in 2025-2026, with a gradual increase in this funding of 3% each year over the next 12 years back to 100%.
There is an option to increase depreciation to 70% for strategic assets in 2025-2026; and keep raising depreciation funding levels by 5% back to 100% each year after. This rebuilds the depreciation reserves quicker – but does impact rates.
Option 1: 3% increase 25-26
- Continue in year one with 65% funding for depreciation of strategic assets.
- Then increase the level of funding by 3% each year for 12 years back to 100% for strategic assets.
- This means $753,300 is not being funded for strategic assets in year one.
- Under-funding depreciation may mean higher levels of debt are required to replace assets in the future.
- Note: strategic assets are the roading, water and wastewater networks.
Option 2: 5% increase for seven years
Increase funding for depreciation by 5% to 70% for strategic assets in year one 2025-26.
- Continue increasing funding by 5% each year for seven years back to 100%.
- Raising depreciation funding to 70% (rather than 100%) results in $634,000 not being funded for depreciation of strategic assets in year one.
- The higher increases rebuilds the depreciation reserves faster.
Topic 3: Planning for the future - Community Library and Research Centre
Council wants to investigate and develop concept plans for a Community Library and Research Centre for our community. We aim to invest money into a plan, but would seek external funding to assist with delivery of the project.
Do you support the idea of a new centre in the future?
If you do support this vision, we need your feedback to shape the plans for a centre that can cater for our future needs:
- What do you think is important?
- What do you want to see in a Community Library and Research Centre?
- For example, do you want more digital resources like computers, internet access, online learning spaces and e-literacy for all ages? Spaces to enjoy book and resources onsite?
- How can a centre provide for our community to learn, research, meet, relax and even work?
Option 1: Develop plans
- Budget $60,000 in year two 2026-27 to investigate and develop plans, by asking our community, for a Community Library and Research Centre.
- Do you want traditional library and new digital resources (for example):
- Places for online learning and literacy for all ages
- Places to experience new technology
- Break-out areas or rooms to meet, play or work
- Listen to talking books, music, podcasts
- Hardcopy books for all ages
- What else...
- Council plans to secure external funding for the physical development of the Community Library and Research Centre. Having plans means we can take advantage of funding opportunities.
Option 2: Other focus areas?
- Delay the investigations into the Community Library and Research Centre until the next Long Term Plan in 2027-28.
- Or are there other areas that you would prefer Council focus on?
- What are these areas?
- Tell us why you want this for the community
- How will the community benefit?
- How do you wish this to be funded?
- A Long Term Plan is the time to look at aspirational goals for our community. Part of planning for the future, is thinking now about what our community may need.
Financial Summary
The following graphs show our financial forecast for the next nine years. This includes our total expenditure, proposed rates for residential, commercial and industrial properties, and capital projects and projected borrowing.
Council’s affordability benchmarks are set as:
- Total rates will not exceed 88% of total revenue
- Annual rates increases will not exceed the average rate of inflation plus 2%
Total Rates Income consists of general and targeted rates.
Council has set the rates (increases) affordability limit as the average rate of inflation, plus 2%.
In years 2025-26, 2027-28, and 2028-29 the proposed rates increases do exceed the rates increases affordability limit. The reasons for exceeding in 2025/26 include increased costs for personnel, depreciation and finance 2027/28 there is additional depreciation budgeted following the 2025 revaluation of Council’s strategic assets (likely to increase Council’s projected depreciation expense); for 2028/29 there are additional expenses for major maintenance works and financing costs for loans to fund water pipe renewals.
Proposed rates for 2025-2026
These graphs show what your rates increases are for 2025-2026. Your rates increase will vary depending on the type of property you have and the capital value. These are only indications, as if we need to make any changes following the consultation process, these figures will change.
Community engagement events
Consultation timeline
Consultation Documents
Have your say
Email: submissions@kaweraudc.govt.nz
Pick up a submission form from the Council Offices, library or isite
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Next steps
Councillors will make final decisions once community feedback from the consultation has been considered.
The Long-term Plan 2025 - 2034 will be audited prior to final adoption in June 2025. Next year, Council will complete an Annual Plan for 2026 – 2027. The year after 2027 – 2028 we will complete another Long Term Plan for the following three years with a 10 year focus.
