I hereby give notice that an ordinary meeting of the Finance and Performance Committee will be held on:

 

Date:

Time:

Meeting Room:

Venue:

 

Tuesday, 3 December 2019

9.30am

Reception Lounge
Auckland Town Hall
301-305 Queen Street
Auckland

 

Kōmiti ā Pūtea, ā Mahi Hoki /
Finance and Performance Committee

 

OPEN AGENDA

 

 

MEMBERSHIP

 

Chairperson

Cr Desley Simpson, JP

 

Deputy Chairperson

Cr Shane Henderson

 

Members

Cr Josephine Bartley

Mayor Hon Phil Goff, CNZM, JP

 

IMSB Member Renata Blair

Cr Richard Hills

 

Cr Dr Cathy Casey

Cr Tracy Mulholland

 

Deputy Mayor Cr Bill Cashmore

Cr Daniel Newman, JP

 

Cr Fa’anana Efeso Collins

Cr Greg Sayers

 

Cr Pippa Coom

Cr Sharon Stewart, QSM

 

Cr Linda Cooper, JP

IMSB Chair David Taipari

 

Cr Angela Dalton

Cr Wayne Walker

 

Cr Chris Darby

Cr John Watson

 

Cr Alf Filipaina

Cr Paul Young

 

Cr Hon Christine Fletcher, QSO

 

 

(Quorum 11 members)

 

 

 

Sandra Gordon

Kaitohutohu Mana Whakahaere Matua /
Senior Governance Advisor

 

26 November 2019

 

Contact Telephone: (09) 890 8150

Email: sandra.gordon@aucklandcouncil.govt.nz

Website: www.aucklandcouncil.govt.nz

 


 


 

Terms of Reference

 

Responsibilities

 

The purpose of the committee is to:

 

a)    advise and support the mayor on the development of the Long-term Plan (LTP) and Annual Plan (AP)

b)    monitor the overall financial management and performance of the council parent organisation and Auckland Council group

c)    make financial decisions required outside of the annual budgeting processes.

 

The committee will establish an annual work programme outlining key focus areas in line with its key responsibilities, which include:

 

·         advising and supporting the mayor on the development of the LTP and AP for consideration by the Governing Body including:

o   local board agreements

o   financial policy related to the LTP and AP

o   setting of rates

o   preparation of the consultation documentation and supporting information, and the consultation process, for the LTP and AP

·         monitoring the operational and capital expenditure of the council parent organisation and Auckland Council Group, and inquiring into any material discrepancies from planned expenditure

·         approving the financial policy of the council parent organisation

·         establishing and managing a structured approach to the approval of non-budgeted expenditure (including grants, loans or guarantees) that reinforces value for money and an expectation of tight expenditure control

·         approve the council insurance strategy and annual insurance placement for Council

·         performance measures and monitoring

·         write-offs

·         acquisition of property in accordance with the LTP

·         disposals in accordance with the LTP

·         recommending the Annual Report to the Governing Body

·         funding for achieving improved outcomes for Māori.

 

Powers

 

(i)         All powers necessary to perform the committee’s responsibilities, including:

(a)        approval of a submission to an external body

(b)        establishment of working parties or steering groups.

(ii)        The committee has the powers to perform the responsibilities of another committee, where it is necessary to make a decision prior to the next meeting of that other committee.

(iii)       If a decision is a budgetary or financial decision that relates primarily to the Finance and Performance Committee responsibilities, the Finance and Performance Committee has the powers to make associated decisions on matters that would otherwise be decided by other committees. For the avoidance of doubt, this means that matters do not need to be taken to multiple committees for decisions.

(iii)       The committee does not have:

(a)        the power to establish subcommittees

(b)        powers that the Governing Body cannot delegate or has retained to itself (section 2)

Exclusion of the public – who needs to leave the meeting

 

Members of the public

 

All members of the public must leave the meeting when the public are excluded unless a resolution is passed permitting a person to remain because their knowledge will assist the meeting.

 

Those who are not members of the public

 

General principles

 

·           Access to confidential information is managed on a “need to know” basis where access to the information is required in order for a person to perform their role.

·           Those who are not members of the meeting (see list below) must leave unless it is necessary for them to remain and hear the debate in order to perform their role.

·           Those who need to be present for one confidential item can remain only for that item and must leave the room for any other confidential items.

·           In any case of doubt, the ruling of the chairperson is final.

 

Members of the meeting

 

·           The members of the meeting remain (all Governing Body members if the meeting is a Governing Body meeting; all members of the committee if the meeting is a committee meeting).

·           However, standing orders require that a councillor who has a pecuniary conflict of interest leave the room.

·           All councillors have the right to attend any meeting of a committee and councillors who are not members of a committee may remain, subject to any limitations in standing orders.

 

Independent Māori Statutory Board

 

·           Members of the Independent Māori Statutory Board who are appointed members of the committee remain.

·           Independent Māori Statutory Board members and staff remain if this is necessary in order for them to perform their role.

 

Staff

 

·           All staff supporting the meeting (administrative, senior management) remain.

·           Other staff who need to because of their role may remain.

 

Local Board members

 

·           Local Board members who need to hear the matter being discussed in order to perform their role may remain.  This will usually be if the matter affects, or is relevant to, a particular Local Board area.

 

Council Controlled Organisations

 

·           Representatives of a Council Controlled Organisation can remain only if required to for discussion of a matter relevant to the Council Controlled Organisation.

 

 

 


Finance and Performance Committee

03 December 2019

 

ITEM   TABLE OF CONTENTS                                                                                         PAGE

1          Apologies                                                                                                                        7

2          Declaration of Interest                                                                                                   7

3          Confirmation of Minutes                                                                                               7

4          Petitions                                                                                                                          7  

5          Public Input                                                                                                                    7

6          Local Board Input                                                                                                          7

7          Extraordinary Business                                                                                                8

8          6 Clonbern Road, Remuera disposal recommendation                                            9

9          Delegation for approval for releasing the interim and full year Auckland Council Group results to the NZX                                                                                            17

10        Auckland Council Group and Auckland Council 2019/2020 quarter one performance report to 30 September 2019                                                                                      21

11        Auckland Regional Amenities Funding Board: Delegate approval of Auckland Council's submission for the 2020/2021 Funding Levy                                          65  

12        Consideration of Extraordinary Items 

PUBLIC EXCLUDED

13        Procedural Motion to Exclude the Public                                                                 67

C1       Delegation for a Weathertightness Claim                                                                 67  

 


1          Apologies

 

At the close of the agenda no apologies had been received.

 

 

2          Declaration of Interest

 

Members are reminded of the need to be vigilant to stand aside from decision making when a conflict arises between their role as a member and any private or other external interest they might have.

 

 

3          Confirmation of Minutes

 

There will be no confirmation of minutes

 

 

4          Petitions

 

At the close of the agenda no requests to present petitions had been received.

 

 

5          Public Input

 

Standing Order 7.7 provides for Public Input.  Applications to speak must be made to the Governance Advisor, in writing, no later than one (1) clear working day prior to the meeting and must include the subject matter.  The meeting Chairperson has the discretion to decline any application that does not meet the requirements of Standing Orders.  A maximum of thirty (30) minutes is allocated to the period for public input with five (5) minutes speaking time for each speaker.

 

At the close of the agenda no requests for public input had been received.

 

 

6          Local Board Input

 

Standing Order 6.2 provides for Local Board Input.  The Chairperson (or nominee of that Chairperson) is entitled to speak for up to five (5) minutes during this time.  The Chairperson of the Local Board (or nominee of that Chairperson) shall wherever practical, give one (1) day’s notice of their wish to speak.  The meeting Chairperson has the discretion to decline any application that does not meet the requirements of Standing Orders.

 

This right is in addition to the right under Standing Order 6.1 to speak to matters on the agenda.

 

At the close of the agenda no requests for local board input had been received.

 


 

 

7          Extraordinary Business

 

Section 46A(7) of the Local Government Official Information and Meetings Act 1987 (as amended) states:

 

“An item that is not on the agenda for a meeting may be dealt with at that meeting if-

 

(a)        The local  authority by resolution so decides; and

 

(b)        The presiding member explains at the meeting, at a time when it is open to the public,-

 

(i)         The reason why the item is not on the agenda; and

 

(ii)        The reason why the discussion of the item cannot be delayed until a subsequent meeting.”

 

Section 46A(7A) of the Local Government Official Information and Meetings Act 1987 (as amended) states:

 

“Where an item is not on the agenda for a meeting,-

 

(a)        That item may be discussed at that meeting if-

 

(i)         That item is a minor matter relating to the general business of the local authority; and

 

(ii)        the presiding member explains at the beginning of the meeting, at a time when it is open to the public, that the item will be discussed at the meeting; but

 

(b)        no resolution, decision or recommendation may be made in respect of that item except to refer that item to a subsequent meeting of the local authority for further discussion.”


Finance and Performance Committee

03 December 2019

 

6 Clonbern Road, Remuera disposal recommendation

File No.: CP2019/19457

 

  

Te take mō te pūrongo

Purpose of the report

1.       To obtain approval to dispose of 6 Clonbern Road, Remuera for redevelopment purposes, subject to the provision of a minimum of 200 car parking spaces and quality design outcomes forming part of the redevelopment of the site.

Whakarāpopototanga matua

Executive summary

2.       6 Clonbern Road is a council-owned property.  A two-level concrete car park is located on the site, which provides a total of 179 car parks. The car park structure has significant structural integrity issues. Auckland Transport (AT) managed the property from 2010.  In March 2019, AT made the decision to close the upper level of the car park due to these issues.

3.       In 2019, AT reviewed 6 Clonbern Road and concluded that it was no longer required for transport infrastructure or service purposes. The AT Board subsequently approved the transfer of the asset to Panuku Development Auckland (Panuku) for redevelopment subject to the provision of a minimum of 200 car parking spaces. The asset is now under Panuku’s management.

4.       Foodstuffs (NZ) Limited (Foodstuffs), which owns the adjacent property at 8-10 Clonbern Road occupied by the New World supermarket, has signalled that it is interested in acquiring 6 Clonbern Road to enable a development encompassing both sites.

5.       Panuku has undertaken the property asset rationalisation process to determine if there are any impediments to the proposed divestment of 6 Clonbern Road for redevelopment purposes.  No current or future public work has been identified and accordingly, it is now recommended for disposal.

6.       Should this site be approved for sale, Panuku will progress a redevelopment at 6 Clonbern Road that will provide a minimum of 200 car parking spaces as well as quality design outcomes within any new development.

Ngā tūtohunga

Recommendation/s

That the Finance and Performance Committee:

a)      approve subject to the satisfactory conclusion of any required statutory processes the disposal for redevelopment purposes of 6 Clonbern Road, Remuera comprised of an estate in fee simple being part Lot 7 DP 3576, part Lot 1 DP 48318, part Lot 1 DP 20189, part Lot 4 DP 3576, part Lot 4 DP 3576, part Lot 5 DP 3576, part Lot 2 DP 48318, part Lot 4 DP 3576, part Lot 5 DP 3576, part Lot 84 DP 3576 and part Lot 85 DP 3576 contained to computer freehold registers NA19D/1099, NA143/246, NA320/154

b)      approve the disposal subject to the provision of a minimum of 200 car parking spaces within any new development;

c)      agree that final terms and conditions be approved under the appropriate delegations.

 

Horopaki

Context

7.       Panuku is required to undertake ongoing review of council’s property assets.  This includes identifying properties in the council portfolio that are no longer required for service use purposes and may be suitable for sale, and development if appropriate. 

8.       Once a property has been identified as no longer being required for current service purposes, Panuku engages with the council and its CCOs to establish whether the property must be retained for a strategic purpose or is required for a future funded service use. After a property is internally cleared of any service requirements, Panuku then consults with local boards, mana whenua and relevant ward councillors. 

9.       All sale recommendations must be approved by the Panuku Board before a final recommendation is made to Auckland Council’s Finance and Performance Committee.  The committee has the delegated authority to approve any proposed disposal.

Property history

10.     6 Clonbern Road is a 2,895m2 site that was acquired by the legacy Auckland City Council (ACC) in three separate transactions in the 1960s for a parking place under s177 of the Municipal Corporations Act 1954.  The property was initially used as an at-grade public carpark from 1966.

11.     In 1982, the site was redeveloped with a concrete platform added above the at-grade car park to provide for a lower covered level of car parking plus a full rooftop level.  90 car parks are located on the lower level and 89 car parks are located on the rooftop level. The redevelopment was undertaken when ACC entered into an agreement with the Remuera (Victoria Avenue) Business Association Incorporated to develop the second level.  The Association contributed approximately 30% of the cost. In return, ACC allowed the building to be used for a free one-hour carpark together with allowing the Association to gain revenue from signage rights.  The rights were to exist for a minimum of 10 years from the completion of the upper level.  The conditions of this agreement have been met and ACC’s obligations terminated in 1992. There are no obligations derived from this agreement as of today.

12.     Vehicular access to and from the upper level of the car park is through Clonbern Road via a two-directional ramp in the north-west corner of the property. The lower level does not have direct road access. Access to the lower level is through the adjoining New World car park at 8-10 Clonbern Road via a right of way. This right of way is secured through a car park licence agreement between Council and the owners of New World, the National Trading Company of New Zealand Limited – the land-owning entity of Foodstuffs. The council has an obligation under the licence to provide 45 spaces on the ground floor level of the car park to Foodstuffs until 2028.

13.     Upon amalgamation of the legacy councils in 2010, AT took over the management of this site.

14.     In 2019 AT reviewed its requirements for the car park and concluded that it was no longer required for AT’s transport infrastructure or service purposes.  In June 2019, the AT Board subsequently approved the transfer of the asset to Panuku for redevelopment subject to the provision of a minimum of 200 car parking spaces. The asset is now under Panuku’s management.

15.     The capital value of 6 Clonbern Road is $11,250,000.  The Auckland Unitary Plan zoning is Business – Town Centre.

Tātaritanga me ngā tohutohu

Analysis and advice

Structural integrity issues

16.     The car park platform has significant structural integrity issues. Based on expert advice, AT made the decision to close the upper level of the car park from 19 March 2019. Panuku does not recommend that the upper level of the Clonbern Road car park be re-opened. This position is informed by further reviews of the structural integrity by both GHD and Tonkin and Taylor. Council’s Regulatory Services and Asset Management Intelligence Support teams support this position.

17.     Panuku is seeking to demolish the car park structure and replace it with an at-grade, open-air asphalted car park. The demolition and reinstatement to an at-grade car park is proposed to commence as early as possible in January 2020 and is anticipated to take seven to eight weeks. There is reduced retail activity in Remuera during January and demolition at this time will minimise disruption to local businesses and shoppers. Panuku and AT are developing a parking and traffic management plan and endeavouring to have this drawn up before the outset of the demolition.  Communication and engagement is being undertaken with the local community and nearby businesses to inform them of the planned demolition, the plan to mitigate as much as possible the loss of parking spaces, and the proposed redevelopment. 

18.     The completed at-grade car park will be open to Remuera shoppers until the commencement of future mixed-use redevelopment of the property.

Redevelopment opportunity

19.     Foodstuffs has signalled that it is interested in acquiring 6 Clonbern Road and undertaking a development encompassing both 6 and 8-10 Clonbern Road (the New World site). Panuku considers this to be an optimal development scheme as it would integrate both 6 Clonbern Road and the adjoining 8-10 Clonbern Road property. An integrated development would be better able to realise strategic and value creation outcomes for council.

20.     Preliminary concept designs for such a development were produced by Monk Mackenzie architects for Foodstuffs in October 2018. The designs detail a mixed retail/residential seven-level building with 347 car parking spaces, the majority of which would be located in two basemented floors.

21.     The transfer of the asset from AT to Panuku in 2019 was conditional upon the provision of a minimum of 200 car parking spaces within a future redevelopment scheme for the property. Amalgamating 6 Clonbern Road with an adjoining property will increase design and development flexibility and the capability to deliver the parking outcome. This applies in the delivery of quality design and mixed-use outcomes also.

22.     Council and Foodstuffs parking arrangements at 6 Clonbern Road and 8-10 Clonbern Road are intrinsically linked through a Licence Agreement between the parties. By way of the agreement, Council provides Foodstuffs with the use of 45 car parking spaces in the lower level of the Clonbern Road car park building until 2028. The agreement also provides Council with a legal right of way across part of the 8-10 Clonbern Road supermarket car park to the lower level of the car park building.

Tauākī whakaaweawe āhuarangi

Climate impact statement

23.       The proposed disposal of 6 Clonbern Road is to facilitate redevelopment of the site. In addition, the concrete parking platform needs to be removed. Accordingly, we consider the impact category for the proposal to be a potential increase, as there will be the demolition of the parking platform and the proposed redevelopment of the property. 


 

24.       Emissions associated with the demolition can be reduced by ensuring the procurement process for the demolition includes appropriate methods for treating the resulting waste.  Emissions associated with the proposed redevelopment of 6 Clonbern Road can be reduced through development standards being included in any future development agreement. It is Panuku policy that all residential developments it negotiates includes ensuring a minimum of Homestar 6.  Panuku policy also includes requirements to reduce carbon emissions in commercial developments.

25.     Key impacts on 6 Clonbern Road from climate change are likely to be higher temperatures and changing rainfall patterns. 6 Clonbern Road is not within a flood plain or near the coast.  Therefore, there are not likely to be significant flooding concerns in the future from either rainfall or rising sea levels.

Ngā whakaaweawe me ngā tirohanga a te rōpū Kaunihera

Council group impacts and views

26.     Internal consultation was undertaken with the council group for 6 Clonbern Road in August 2019.

27.     Watercare advised that there are a number of gravity wastewater lines and manholes located on 6 Clonbern Road that will need to be protected from damage should the property be redeveloped.

28.     No other issues were raised and no planned or funded alternative public work were identified via the internal consultation.

Ngā whakaaweawe ā-rohe me ngā tirohanga a te poari ā-rohe

Local impacts and local board views

29.     6 Clonbern Road was reported to the Ōrākei Local Board’s 19 September 2019 business meeting.  The Ōrākei Local Board resolved the following:

“That the Ōrākei Local Board endorse the proposed disposal of 6 Clonbern Road, Remuera for redevelopment purposes, subject to the provision of a minimum of 200 (to be retained in Council ownership) car parking spaces and agreed Panuku Development Auckland design standards” (OR/2019/202).

Tauākī whakaaweawe Māori

Māori impact statement

30.     19 mana whenua iwi authorities were contacted regarding the proposed divestment sale of 6 Clonbern Road on 27 August 2019. The following feedback was received.

a)      Ngaati Whanaunga

No feedback was received for this site.

b)      Ngāi Tai ki Tāmaki

No feedback was received for this site.

c)      Ngāti Manuhiri

No feedback was received for this site.

d)      Ngāti Maru

No feedback was received for this site.

e)      Ngāti Paoa

No feedback was received for this site.

f)       Ngāti Rehua

No feedback was received for this site.

g)      Ngāti Tamaoho

No feedback was received for this site.

h)      Ngāti Tamaterā

No feedback was received for this site.

i)        Ngāti te Ata

Ngāti Te Ata expressed interest in potentially acquiring and developing this site in partnership with Panuku and any other interested parties.

j)        Ngāti Wai

No feedback was received for this site.

k)      Ngāti Whatua o Kaipara

No feedback was received for this site.

l)        Ngāti Whātua Ōrākei

No feedback was received for this site.

m)     Te Ahiwaru

No feedback was received for this site.

n)      Te Ākitai Waiohua

No feedback was received for this site.

o)      Te Kawerau ā Maki

No feedback was received for this site.

p)      Te Patukirikiri

No feedback was received for this site.

q)      Te Rūnanga o Ngāti Whātua

No feedback was received for this site.

r)       Te Uri o Hau

No feedback was received for this site.

s)       Waikato-Tainui

No feedback was received for this site.

Ngā ritenga ā-pūtea

Financial implications

31.     As there is no funding allocated in the council’s 10-year budget (long-term plan) for the construction of 200 car parks at 6 Clonbern Road, proceeds of sale from the proposed divestment/development of this property will need to be allocated to the construction and retention of 200 car parks at the property. 

32.     The balance of the proceeds of sale (if any) will be allocated to the council’s 10-year budget. Capital receipts from the sale of properties no longer required for council infrastructure or service purposes contribute to Auckland Plan outcomes and the 10-year budget (long-term plan) by providing the council with an efficient use of capital and prioritisation of funds to achieve its activities and projects. In the 2019/2020 financial year, the 10-year budget (long term plan) has forecast the disposal of non-strategic assets to the value of of $24 million.

Ngā raru tūpono me ngā whakamaurutanga

Risks and mitigations

33.     An investigation undertaken by Simpson Grierson in 1998 concluded that 6 Clonbern Road would be exempt from the offer-back obligations to the former owners set out in s40 of the Public Works Act 1981 on the basis that there has been a significant change to the property.

Ngā koringa ā-muri

Next steps

34.     Subject to Finance and Performance Committee approval to divest of this property, Panuku would seek to enter into a period of exclusive negotiations with Foodstuffs as the adjacent landowner to understand further whether an integrated development opportunity across 6 Clonbern Road and 8-10 Clonbern Road incorporating 200 carparks for public use is both viable and provides for the necessary outcomes being sought for Remuera.

 

Ngā tāpirihanga

Attachments

No.

Title

Page

a

Images of 6 Clonbern Road, Remuera

15

      

Ngā kaihaina

Signatories

Author

Letitia Edwards - Team Leader Portfolio Review, Panuku Development Auckland

Authorisers

Marian Webb – Head of Strategic Asset Optimisation, Panuku Development Auckland

David Rankin – Chief Executive Officer (acting), Panuku Development Auckland

Matthew Walker – Group Chief Financial Officer

 


Finance and Performance Committee

03 December 2019

 


Finance and Performance Committee

03 December 2019

 

Delegation for approval for releasing the interim and full year Auckland Council Group results to the NZX

File No.: CP2019/19349

 

  

Te take mō te pūrongo

Purpose of the report

1.       To delegate authority to the chair and deputy chair of the Finance and Performance Committee to release the Auckland Council Group interim and full year result announcements to New Zealand’s exchange (the NZX); continuing the delegation from previous council terms.

Whakarāpopototanga matua

Executive summary

2.       Auckland Council has bonds listed on the NZX, Singapore and Swiss exchanges. NZX listing rules impose reporting obligations on the Auckland Council Group, including the release of interim results and full year results within 60 days of the end of the reporting period.

3.       Approval of the interim and full year results is the core responsibility of “Those Charged with Governance” (TCWG) which has been delegated by the Governing Body to the Finance and Performance Committee.

4.       Preparation of the Auckland Council Group financial statements is a lengthy, complex process involving consolidation of the group results and the review or audit of the interim and full year reports. These tasks cannot be completed in time to present at the regular Finance and Performance Committee meetings and meet the NZX reporting timeframes. As a result, a delegation of approval to release the reports to the NZX is required; continuing the delegation from previous council terms.

5.       The Auditor-General is the Auckland Council Group and Auckland Council’s auditor. The Auditor-General has appointed Athol Graham of Audit New Zealand to undertake the audit of our results for the year ended 30 June each year, on his behalf.

6.       Audit New Zealand is also engaged to undertake a review of the Auckland Council Group interim results for the half year ending 31 December each year. A review engagement provides a moderate level of negative assurance, which is at a lower level of assurance than that of an audit. The review is performed in accordance with the Review Engagement Standards issued by the External Reporting Board and primarily involves enquiry, analytical procedures and discussion.

 

Ngā tūtohunga

Recommendation/s

That the Finance and Performance Committee:

a)      delegate authority to the chair and deputy chair of the Finance and Performance Committee to approve the release of the interim and full year Auckland Council Group financial results to the NZX for each reporting period through to 30 June 2022; being the end of the current term of the elected members.

 

Horopaki

Context

7.       Auckland Council is an issuer of bonds listed on the New Zealand, Singapore and Swiss exchanges. The NZX requires the interim and full year financial results to be published. The results are required to be released to the NZX within 60 days of the end of the 31 December and 30 June reporting periods.

8.       The reports relate to the performance of the Auckland Council Group, therefore approving them for release falls within the delegation of the Finance and Performance Committee.

9.       Preparation of the Auckland Council Group financial statements is a lengthy, complex process. These tasks cannot be completed in time to present at the regular Finance and Performance Committee meetings and achieve the NZX reporting timeframes. As a result of this there are two options for officers to obtain approval for the release of information:

·        call an extraordinary meeting of the committee

·        the committee delegate the approval.

Tātaritanga me ngā tohutohu

Analysis and advice

10.     It is not considered an efficient use of councillors’ time to call a meeting of the full committee to consider one item.

11.     The delegation being sought continues a delegation approved by the previous council’s Finance and Performance Committee.

12.     If approved, the delegation will not limit or restrict councillors’ access to the Auckland Council Group financial information. The interim and final results are advised to councillors via email immediately following release to the NZX. The interim and full year results (including the annual report) will be presented to the Finance and Performance Committee meeting immediately following the release.

13.     For these reasons, delegation of approval to release the reports is the preferred and recommended option.

14.     For efficiency, it is proposed the Finance and Performance Committee approve the delegation for the term of this council, i.e. up to and including the NZX reporting for the 12 months to 30 June 2022.

Tauākī whakaaweawe āhuarangi

Climate impact statement

15.     This delegation relates only to approving results and as such has no climate implications. Information relating to the Auckland Council Group’s climate impact will be included as part of the interim and full year financial results and reports.

Ngā whakaaweawe me ngā tirohanga a te rōpū Kaunihera

Council group impacts and views

16.     This report relates to the Auckland Council Group and as such takes into account group impacts and views.

Ngā whakaaweawe ā-rohe me ngā tirohanga a te poari ā-rohe

Local impacts and local board views

17.     The report applies to the interim and full year financial results releases to the NZX for the Auckland Council Group, which does not include reporting at a local board level. Local boards’ performance information is reported in the annual report.

Tauākī whakaaweawe Māori

Māori impact statement

18.     The interim and full year results releases to the NZX do not affect the achievement or reporting of Auckland Council’s contributions to Māori outcomes which are reported in the annual report.

Ngā ritenga ā-pūtea

Financial implications

19.     This report relates to the approval of financial reporting for the Auckland Council Group, and no decision is sought that would have direct financial implications.

Ngā raru tūpono me ngā whakamaurutanga

Risks and mitigations

20.     Without this delegation there is a likely risk of delays in approving and releasing the results within the NZX requirements. Failing to meet the NZX’s deadlines could result in fines or being removed from the NZX.

21.     As part of the approval process, prior to the results being approved by elected members, checks are in place to mitigate the risk of errors or non-compliance with legislation and accounting standards occurring in the preparation of results.

·        The Audit and Risk Committee reviews the quality of the results, the processes used by management, and compliance with legislation and the financial reporting standards.

·        The Audit and Risk Committee reviews the audit risk process with the Office of the Auditor-General and Audit New Zealand.

·        Quality assurance reviews are performed by qualified council finance and legal staff. These reviews focus on accuracy, completeness and reasonableness of disclosures, legislative compliance and adherence to the council’s communications standards. Reviews are carried out by staff with differing levels and areas of involvement in financial reporting.

Ngā koringa ā-muri

Next steps

22.     The Auckland Council Group interim and full year results will be provided to the chair and deputy chair of the Finance Performance Committee at the end of each reporting period and prior to the results being released.

23.     The chair and deputy chair of the Finance Performance Committee will, under delegation, recommend to the mayor and the chief executive that they approve the release the results to the New Zealand, Singapore and Swiss exchanges.

Ngā tāpirihanga

Attachments

There are no attachments for this report.    

Ngā kaihaina

Signatories

Authors

Francis  Caetano - Group Financial Controller

John Bishop - Group Treasurer

Authoriser

Matthew Walker - Group Chief Financial Officer

 


Finance and Performance Committee

03 December 2019

 

Auckland Council Group and Auckland Council 2019/2020 quarter one performance report to 30 September 2019

File No.: CP2019/19590

 

  

Te take mō te pūrongo

Purpose of the report

1.       To provide an update on the financial and non-financial performance for the Auckland Council Group and Auckland Council against the 10-year Budget (as updated by the Annual Budget 2019/2020) for the three months to 30 September 2019.

Whakarāpopototanga matua

Executive summary

2.       The 10-year Budget 2018-2028 was adopted in June 2018 and subsequently updated by the Annual Budget 2019/2020 in June 2019.

3.       The budget included a $26 billion capital investment programme to address growth pressures on transport, water, environment and community infrastructure over the decade. It also included additional operating budgets to address areas such as the natural environment.

4.       Attachment A and B report on the Auckland Council Group and Auckland Council performance against the updated 10-year Budget for 2019/2020 quarter one. Attachment C provides a statutory view of the Group results and reconciles with the Group Quarterly Performance Pack.

5.       Representatives of the substantive council-controlled organisations (CCOs) boards, chief executives and chief financial officers will be presenting at 12 December 2019, CCO Oversight Committee.

Summary of the attached quarter one performance pack

6.       The Auckland Council Group has delivered a steady performance over the three-month period to 30 September 2019.

7.       There has been solid capital progress with $502 million capital expenditure delivered over the three-month period. This is a $130 million increase compared to the same period last year.

8.       There has also been strong operating performance for the three-month period. Direct revenue (revenue excluding rates, capital revenue, finance and regional fuel tax revenue) was $32 million ahead of budget, while direct expenditure (expenditure excluding depreciation and interest) was $4 million favourable. Overall, this was a $36 million favourable result against the net direct operating budget.

9.       During the quarter, council issued a mix of Euro denominated Bonds, Green Bonds, and commercial paper to meet new capital expenditure funding requirements and to refinance maturing debt. This increased both gross borrowings and cash balances. The cash balance will be used to repay maturing debt in subsequent quarters.

10.     As a result of the increase in gross borrowings, the gross debt to adjusted revenue ratio was temporarily elevated at 263%. The ratio is on track to meet the year-end target of 253% as maturing debt is repaid with the surplus cash from the earlier bond issuances.

11.     Overall, the Auckland Council Group balance sheet remains healthy, with net debt currently at $9.1 billion under the year-end budget of $9.6 billion. Net debt to total assets was 16 per cent which was below the year-end projection of 17 per cent.

12.     Full-time equivalents (FTEs) for the Group and Auckland Council increased by 193 and 135 respectively since 30 June 2019.

13.     Auckland Council FTEs have increased largely due to recruitment for Regulatory Services in response to current consenting volumes and complexity, as well as additional resource to support Customer & Community activities such as maintenance contract management. There was also an uplift in seasonal workers ahead of summer.

14.     FTEs in Regulatory Services are expected to continue to increase to cope with Auckland’s rapid growth, which has seen an all-time record of 14,634 of new dwelling consents issued in the year to September 2019.

15.     The risk of rising construction costs and potential market capacity constraints remain a key consideration for the delivery of the Group’s capital programme. Staff will continue to monitor these trends and manage capital projects accordingly.

16.     Detailed financial and non-financial performance of the Auckland Council Group and Auckland Council and provided in the attachments.

 

Ngā tūtohunga

Recommendation/s

That the Finance and Performance Committee:

a)      receive the Auckland Council Group and Auckland Council quarterly performance report for the period ended 30 September 2019.

 

 

 

Ngā tāpirihanga

Attachments

No.

Title

Page

a

Auckland Council Group - Quarter 1 Performance Report for the period ending 30 September 2019

23

b

Auckland Council - Quarter 1 Performance Report for the period ending 30 September 2019

41

c

Auckland Council Group - Quarterly Financial Report 30 September 2019

57

     

Ngā kaihaina

Signatories

Authors

Karuna  Dahya - Strategy Analyst

Louis Ong - Financial Analyst

Hinewairere  Warren - Project Manager

Authorisers

Nicola Mills – General Manger, Financial and Business Performance

Ross Tucker - General Manager, Financial Strategy and Planning

Matthew Walker - Group Chief Financial Officer

 


Finance and Performance Committee

03 December 2019

 

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03 December 2019

 

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03 December 2019

 

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Finance and Performance Committee

03 December 2019

 

Auckland Regional Amenities Funding Board: Delegate approval of Auckland Council's submission for the 2020/2021 Funding Levy

File No.: CP2019/19806

 

  

Te take mō te pūrongo

Purpose of the report

1.       To delegate approval of the Auckland Council submission to the Auckland Regional Amenities Funding Board Draft Funding Plan 2020/2021.

Whakarāpopototanga matua

Executive summary

2.       The Auckland Regional Amenities Funding Act 2008 (the Act) provides for nine regional organisations to submit annual funding applications to the Auckland Regional Amenities Funding Board (Funding Board). 

3.       The Funding Board must analyse these applications and prepare a draft funding plan, before finalising and levying Auckland Council.

4.       The Act requires the Funding Board to prepare a draft funding plan that provides any information that is necessary to enable an informed assessment of the annual levy. 

5.       Council can make a submission on the draft funding plan.   The draft funding plan is yet to be published by the Funding Board. 

6.       Once the draft funding plan is published, the final date for receiving submissions will be 10 February 2020.   A report in March 2020 will consider the levy itself.

7.       Given the timing difference between publication of the draft funding plan, the Finance and Performance Committee meetings, and the submission period, this report seeks to delegate approval of council’s submission on the Draft Funding Plan 2020/2021 to the chair and deputy chair of this committee. 

Ngā tūtohunga

Recommendation/s

That the Finance and Performance Committee:

a)      delegate approval of the Auckland Council submission to the Auckland Regional Amenities Funding Board Draft Funding Plan 2020/2021 to the chair and/or deputy chair Finance and Performance Committee.

 

Ngā tāpirihanga

Attachments

There are no attachments for this report.    

Ngā kaihaina

Signatories

Author

Josie Meuli - Senior Advisor

Authorisers

Alastair Cameron - Manager - CCO Governance & External Partnerships

Phil Wilson - Governance Director

Matthew Walker - Group Chief Financial Officer

      

 


Finance and Performance Committee

03 December 2019

 

Exclusion of the Public: Local Government Official Information and Meetings Act 1987

That the Finance and Performance Committee

a)      exclude the public from the following part(s) of the proceedings of this meeting.

The general subject of each matter to be considered while the public is excluded, the reason for passing this resolution in relation to each matter, and the specific grounds under section 48(1) of the Local Government Official Information and Meetings Act 1987 for the passing of this resolution follows.

This resolution is made in reliance on section 48(1)(a) of the Local Government Official Information and Meetings Act 1987 and the particular interest or interests protected by section 6 or section 7 of that Act which would be prejudiced by the holding of the whole or relevant part of the proceedings of the meeting in public, as follows:

 

C1       Delegation for a Weathertightness Claim

Reason for passing this resolution in relation to each matter

Particular interest(s) protected (where applicable)

Ground(s) under section 48(1) for the passing of this resolution

The public conduct of the part of the meeting would be likely to result in the disclosure of information for which good reason for withholding exists under section 7.

s7(2)(g) - The withholding of the information is necessary to maintain legal professional privilege.

s7(2)(i) - The withholding of the information is necessary to enable the local authority to carry on, without prejudice or disadvantage, negotiations (including commercial and industrial negotiations).

In particular, the report contains legal advice and information confidential to legal proceedings

s48(1)(a)

The public conduct of the part of the meeting would be likely to result in the disclosure of information for which good reason for withholding exists under section 7.