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Council Request for Staff to Consider Different
Rating Options for Mercury Bay Parks and Reserves
TO
Mercury Bay Community Board
FROM
Steve Baker - Chief Financial Officer
DATE
6 June 2013
SUBJECT
Council Request for Staff to Consider Different Rating Options
for Mercury Bay Parks and Reserves
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Purpose of Report
On Tuesday 12 June the Community Board and Council will workshop some potential
options and associated risks arising from the Council request to review the manner in which
the Mercury Bay Parks and Reserves activity is funded and in particular the funding of the
new Mercury Bay Sports Complex (MBSC) in the 2013-14 Annual Plan
The purpose of this report is to seek the Board's official endorsement if a preferred option is
identified in that workshop.
This will then enable staff to calculate the rates for 2013/2014 and submit them to Council
for within the legislated timeframes.
Failure to set the rate for 2013/2014 prior to 30 June 2013 will have a significant adverse
impact on Council finances.
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Background
The purpose of the Ten Year Plan is to"
 Describe the activities of Council
 Describe the community outcomes
 Provide a basis of accountability
 Provide an opportunity for participation by the public in decision making process on
activities to be undertaken by the Council. It is assumed this would also include how
those individual activities would be funded.
On the 27 of June 2012, Council adopted a Ten Year Plan for the period 1 July 2012
through to 30 June 2013.
The purpose of Council's Annual Plan, amongst others, is to:
 Identify any variation [emphasis added] from the financial statements and funding
impact statement included in its Ten Year Plan.
 Contribute to the accountability to the Community
 Extend opportunities for participation by the public in decision-making processes
relating to the costs and funding of activities to be undertaken.
Council has recently completed its deliberations phase of the process to adopt the Annual
Plan for 2013/14, where it considered submissions received during the special consultative
phase.
During these deliberations, Council considered submission number 119 regarding the rates
requirement for the Mercury Bay Multi Sports Complex.
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During discussion on this submission members of the Council felt that, with the introduction
of the MBSC into the Mercury Bay Parks and Reserves activity, that the current funding
model was inequitable for those properties with high land value located outside of the
Whitianga Township.
Council considered that with the introduction of the MBSC within the Mercury Bay Parks
and Reserves activity that the activities composition is now so significantly different from the
other Community Board areas that a consistent rating structure across each of the
community board areas would no longer be appropriate. As such Council considered that
the MBSC introduction necessitates a change to the funding structure of the Mercury Bay
Parks and Reserves activity contained within the 2013/14 Annual Plan. Accordingly it made
the following request:
"Notes that between now and the adoption of the Annual Plan staff will bring back
options and implications for more even funding of the capital expenditure (e.g.
targeted rate for Mercury Bay)".
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Issue
Staff have been requested to identify any potential inhibitors that may restrict Council's
ability to address the perceived inequity that has arisen with the advent of the MBSC in
relation to the funding of the Mercury Bay Parks and Reserves activity.
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Discussion
Council Activities
The 2012-2022 Ten Year Plan set out 28 activities of Council together with:
 What we do in each activity
 How the activity contributes to the District
 What the activity includes
 And what services you expect us to deliver from the activity.
 Any major projects
 How it will be funded
 Any significant negative effects that might arise out of the activity; and
 What has changed since the 2009-2019 Ten-Year Plan?
One of those 28 activities is the Parks and Reserves Activity. A key project listed under that
activity was the third instalment in relation to the purchase of the land on which the MBSC
is situated and the construction of the complex itself.
In relation to how the activity was to be funded, the Ten year Plan asserted that local
communities are considered to primarily benefit from this activity as they have the best
access to local parks and reserves, and because the parks and reserves in each board
area contribute to that community's "sense of place".
Funding of Operating Expenditure
Catchment(s)*
In a bit more detail...
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Activity
Fees and
Charges
UAGC
General
Rate
Targeted
Rate**


Parks &
Reserves
LOW
HIGH
Board Area


Fees and charges - (low)
Targeted rate land value (board) (medium)
Targeted rate fixed charge (board) (low)
Funding of this activity varies by
Community Board Area
As such, currently each Community funds its own parks and
reserves. They do this largely by targeted rate to local
communities. The portion calculated by land value purportedly
reflects the need to recognise affordability within communities.
A small amount of funding is generated by user charges for
those who may have exclusive access to areas of parks at
times.
Note the Locally Targeted Rate and Charge used to fund
the Mercury Bay Parks and Reserves is sourced only
from the Mercury Bay Community Board Area.
Staff will lead a discussion on this matter with Council seeking its guidance on a potential
solution on the funding structure for the Mercury Bay Parks and Reserves Activity so that it
may be incorporated into the Draft Annual Plan for 2013/2014. The Draft Annual Plan will
then be submitted for Council's formal approval on the 26 June 2013.
Prior to the Mercury Bay Community Board meeting this month, Council staff will workshop
the issue with the Audit Committee and at the Council workshop. Outcomes from both
workshops will contribute to the resolutions formed at the following Mercury Bay Community
Board meeting to be held on 18 June 2013.
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Suggested Resolution(s)
That the Mercury Bay Community Board:
1.
2.
Receives the report.
To be completed at the Community Board meeting.