Waitangi Day activities at Campbell Park, Paekākāriki. Photo: Mark Coote.

Contents

Toitū Kāpiti draft annual plan 2020/21 Community information document Year three of our Long Term Plan 2018–38 and our strategy to respond to the impacts of COVID-19 on our district

Foreword from the Mayor .................................................................... 2Overview from the Chief Executive ..................................................... 5Process for developing the plan ......................................................... 6Our main projects ............................................................................... 8Our initiatives to respond to COVID-19 ............................................... 11Our budget and financial summary .................................................... 12How to get further information, ask questions and comment .......... 19

May 2020

Foreword from the Mayor

Tēnā koutou katoa

On behalf of your Council, I’m pleased to share with everyone in our community this summary of our draft Annual Plan for 2020/21. The plan for this coming year is different from any other, because a significant part of it is concerned with our response to the unprecedented impacts of the COVID-19 pandemic. Your Council is unanimous that our priority is to focus on our district’s essential infrastructure and services, and support our community to recover and rebuild. This was endorsed by the Community Boards who have helped shape our adjusted draft plan and I am very grateful for their contribution.

This information document outlines our planned work programme for the year, as per our Toitū Kāpiti Long Term Plan 2018–38 (LTP), and our strategy for helping our residents and businesses recover from the impacts of the pandemic.

We hope that by the time delivery of the Annual Plan begins in July, the efforts and commitment of our communities will mean that we will have passed the peak of the virus in terms of public health. However, Council is mindful that the impacts of the pandemic are wide ranging, and may not be fully understood for some time.

We are also mindful that to be responsive to the needs of our community, our Annual Plan must be flexible. It is important to have a plan in place, and we are required to do so by law, but we will

be continuously monitoring and will adjust the plan if we need to. This may mean that some projects in our work programme do not progress as fast, or it may mean we reprioritise some funding and introduce additional support initiatives. We will share with you any significant changes we need to make.

Our planned work programmeThe main projects we propose for this year are as set out in the work programme for year three of the LTP. These projects are focused on essential infrastructure and development of our district, both of which are important for our recovery. Many of them continue work already underway or in preparation. The key items are summarised in this document.

Our initiatives to respond to COVID-19 Alongside our LTP projects we will deliver a special COVID-19 recovery plan. This will range across our activities, from working with community organisations around welfare needs and resilience, to initiatives to encourage local business recovery. Our immediate actions – which we have already started – are outlined in this document. Longer term responses will be developed as we have more information about the specific impacts on our district and can determine the best way Council can help. What else we do also depends on further Government action.

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Central government’s role and Council’s roleOur approach recognises that central government is taking the lead role in managing public health, in providing income and business support to New Zealanders affected, and in driving economic recovery. Our main role as a local authority is to maintain essential services and complement the Government’s relief and stimulus initiatives where we can, including helping people and businesses access the support Government is providing.

Rates for 2020/21Setting rates for the coming year is done alongside the Annual Plan. Council has looked long and hard at what our rates need to be for 2020/21, and what we believe is a necessary increase in order to continue to deliver services to our community and play a role in our district’s recovery from COVID-19. We have done this with the joint consideration of our responsibility to provide core services and our wish to ease the burden on people. We are proposing an average rates increase of 2.6% – which is around $1.65 per week per ratepayer. This increase is as low as we can make it without cutting services or taking on an irresponsible level of debt.

When we agreed our LTP with the community in June 2018, the rates projection for 2020/21 was 3.8%. Prior to the pandemic we had planned to consult on an increase of 5.7%, which included stepping up action to reduce carbon emissions and improving housing access and affordability. Reducing the increase to 2.6% means we can’t do those extra things, but we can continue planned infrastructure projects and support the community through recovery.

Help with rates Council recognises that any rates increase has an impact, particularly for those in our community on fixed incomes and, at this time, those affected financially by the pandemic. We are increasing

the rates relief available, and all the ways people can access support with their rates (and other costs) are set out in our COVID-19 response plan. This includes relief for rates payments for the remainder of this financial year for people and businesses who are struggling financially because of COVID-19.

No increases to water rates or fees and charges While property rates are the biggest cost, we are aware people may also struggle with water rates and increases to fees for services like dog registration. For 2020/21, we will keep water rates the same as now, and we will not increase any fees or charges.

Help with water rates for large families with high water costs will continue to be available.

Our Annual Plan budgetCompared with many other councils, Kāpiti is more dependent on rates income to fund core services and development. To keep the rates increase to 2.6%, we will slow down our planned repayment of borrowings for asset replacement, including our water supply, and remove inflation from operating budgets. We will also limit capital spending to $38 million. Council believes this is the right thing to do given the current situation, and it is manageable for the coming year.

However, beyond that, we will need to get back on track in repaying debt to be able to afford to borrow in the future for the significant water, wastewater and stormwater asset replacements our district will need from around 2040. Our strategy of positioning ourselves for future needs is important for two reasons. The first is that our core job is to provide you with essential services, such as ensuring clean drinking water and managing wastewater and stormwater. Secondly, it is Council’s responsibility to manage our district’s finances carefully on the community’s behalf, so we do not find ourselves in a vulnerable place in years to come.

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Finalising our plan for 2020/21As the Annual Plan for 2020/21 is largely the work programme for year three of the LTP, and the rates and capital spending are below the agreed limits of our financial strategy, we are not calling for submissions. However, we welcome your comments or questions. Over the next month we will also look at any other opportunities to trim costs before we decide the final plan in June.

Later in the year, when we begin to shape our next long term plan, there will be a full opportunity for input about our direction and the priorities for our community.

Thank you, KāpitiOn behalf of Council, I want to thank you all for your response to the pandemic so far and to thank you in advance for the unity and resilience and ongoing care for each other we will need as we recover.

Our long term plan is titled ‘building a stronger Kāpiti together’ and that remains the focus of this Annual Plan. I have great faith in the people who make our wonderful district home, and I feel positive that, while this will be hard, we will ultimately emerge stronger.

Toitū te whenua, toitū te wai, toitū te tāngata, toitū Kāpiti.

Ngā mihi

Mayor K Gurunathan

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Tēnā koutou katoa

As Chief Executive for Kāpiti Coast District Council, I want to explain more about how our organisation is responding to the unprecedented impacts of COVID-19 and how we will implement elected members’ decisions on behalf of the community.First, I want to echo the Mayor’s expressions of concern for our district. We are very aware of the fact that many people and businesses are hurting because of the pandemic and that we face a long period of recovery.

Since mid-March we have reviewed our budgets to give councillors options for how the work programme can be managed to keep services going, and develop a cohesive response to our district’s recovery.

Difficult decisions on ratesAs the Mayor has stated, rates have been a key consideration for Council. We acknowledge that not everyone will agree with the 2.6% average rates increase proposed. However, the reality is that to go any lower, or to have a zero rates increase, would only defer necessary costs or force us to reduce services or increase our borrowings beyond a prudent level. This would then lead to higher than average rates increases in future years to enable us to ‘catch up’. It would also limit our ability to support people’s recovery and the rebuilding of our economy, which would hurt our community now and down the track. We face extra costs this year, such as meeting the Government’s new drinking water safety reporting requirements, so we do need some additional rates income.

Pandemic response began immediatelyOur staff have swung into action in immediate response to the pandemic, with a package of support ranging from extra relief on rates through to direct welfare support. The Council has already

made decisions to allow us to offer this support immediately. Our community and economic development teams are working on longer term recovery responses, which we will be able to shape up when we have more information about how the district is faring and what help would be most valuable.

Ongoing monitoring of budgets and needsThroughout the year we will look for opportunities to trim budgets or to defer work without putting core services at risk. We will also be closely monitoring the extended impacts of the pandemic on our community and may recommend reprioritising some funding for further recovery initiatives. We will also be actively pursuing any assistance central government offers for financing for infrastructure (through Crown Infrastructure Partners for example), or other opportunities to support rebuilding. We will keep you informed about this.

Our commitment to our communityThese are very challenging times and Council has had to make some hard decisions. The community’s wellbeing has been central to all the deliberations. I know from the way our staff have taken on extra work recently that they are committed to keep delivering services and helping our community recover. On their behalf, I would like to acknowledge the messages of appreciation and support we have received. Thank you.

Nāku noa, nā

Wayne Maxwell Chief Executive

Overview from the Chief Executive

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How has Council developed the proposed Annual Plan?As outlined by the Mayor, the draft Annual Plan for 2020/21 is different from any other because of COVID-19. However, Council has gone through the same process it does every year. In fact, it has done so twice – prior to the scale of COVID-19 challenges becoming apparent, and following that, to arrive at the current draft Annual Plan.

Development prior to COVID-19 The starting point for the Annual Plan is the work programme in the Toitū Kāpiti Long Term Plan 2018–38 (LTP). This includes estimated timings and costs for all our main pieces of work.

We began this year’s Annual Plan by looking in detail at the projects and budgets for the coming year. We checked if all the proposed work is achievable in the timeframe and for the estimated costs. We looked at what’s come up since we laid out our expected long term programme, including everything from service requests by residents, through to new laws, and key issues for our district. In particular, Council looked at how access to affordable housing and the impacts of climate change have become more urgent. We asked our Community Boards what’s important to each part of the district, and considered some additional activity.

We then looked at how the proposed budget would change the level of rates and what is affordable for Kāpiti Coast ratepayers. At this point in the planning, we were looking at proposing a draft Annual Plan with an average rates increase of 5.7%.

Sharing the plan with the communityThe Council is providing the key components of the draft Annual Plan online for the community’s information. We are not calling for submissions because there aren’t any new spending proposals or significant changes to services from the LTP, which has already been consulted on and agreed. However, you are welcome to ask questions or provide feedback. If you wish to do so, please see the options on page 19.

We are also not asking for proposals or funding requests. Council has already worked hard to reduce expenditure to keep rates down for the coming year and any further funding requests would only contribute to a higher average rates increase. Proposals that Council had been considering, including requests from Community Boards, and any new funding requests will be looked at again as part of the development of the next LTP when that gets underway. As the Mayor noted, there will be an opportunity in the LTP process for full community engagement on our direction and priorities.

Redevelopment following COVID-19As soon as Council became aware of how significant the pandemic was, it decided to review all aspects of the draft plan. Council considered adding to the plan to support the community through the impacts of the pandemic. This meant a review of our budget and rates – property and water – and fees and charges. Council considered the impact of rates on the community at this time, and the assistance it could provide for rates relief as well as the other elements of the support package.

As a result of the redevelopment, we reduced the average rates increase to 2.6%.

Process for developing the plan

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How do we get to our final Annual Plan? Our Annual Plan is decided by the Council, as the community’s elected representatives. By law, the plan must be adopted and the rates set by the end of June so we can start the new financial year – on 1 July – with our plan ready to go and people clear about the level of rates needed to fund it.

During May, Council will consider the latest information on the pandemic and the impacts on our district, and what this means for our work programme and response initiatives – as well as any opportunities to reduce costs further. We will also consider the questions and comments we receive.

During June, Council will finalise the content of the plan, and then formally adopt the Annual Plan and set the rates on 25 June 2020.

Earlier adoption for fees and chargesCouncil will adopt the fees and charges for 2020/21 earlier – on 28 May 2020. This means we can remind dog owners about registration fees in June with payments due in July.

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Our main projects

As the Mayor outlined, our intended work programme for 2020/21 is to deliver the year three initiatives in the Toitū Kāpiti Long Term Plan 2018–38 (LTP). Those initiatives are based on the priorities agreed in the LTP, which are also relevant to our focus on helping our district rebuild from COVID-19. These are some of the key pieces of work we’ll focus on during the year, as set out in the LTP.

Continue our drinking water safety and resilience programme

We will:

→ start Hautere/Te Horo drinking water safety upgrades – $1.3 million

→ complete upgrade of the Ōtaki water treatment plant – $3.5 million

→ continue to deliver the Waikanae stage 2 treatment plant upgrade – $1.9 million.

Improve our wastewater treatment infrastructure

We will complete inlet works for Paraparaumu wastewater treatment plant – $1.8 million.

Improve our local roads

We will:

→ continue SH1 revocation works – $1.3 million. Read more about SH1 revocation.

→ increase footpath renewal budget by 51% to $1.7 million (the increase is fully funded by NZTA).

Address flood risks

We will continue our stormwater programme to protect homes from flooding and improve downstream flow – $4.2 million.

Through the LTP we prioritised each stormwater project based on risk. Read more about the stormwater programme. In 2020/21 the following projects are priority:

→ Amohia catchment

→ Amohia Street

→ Kākāriki Stream

→ Kena Kena

→ Moa Road floodwall

→ Ōtaki Beach

→ Paraparaumu catchment asset renewals

→ Riwai Street

→ Sunshine Avenue

→ Titoki Street

Capex and opex and impacts for rates The costs for our projects described here are capital expenditure (capex).

Capex typically relates to building, upgrading or replacing assets which we fund with loans paid back over the ‘life’ of the asset (the period of time it is in use), so the cost is spread over many years. For example, upgrades and renewals of Council’s wastewater treatment plants are spread over 25 years because that’s how long the plant or its components can be used. Our stormwater assets last longer so can be paid for over 75 years.

Opex – operating expenditure – includes things like maintenance and running costs, which are funded directly by rates (or fees) in the year we pay for them.

What does this mean for rates?Opex has a more immediate impact on rates than capex. For example:

→ $1M change to our capex budget would impact 2020/21 rates by +/- 0.03%

→ $1M change to our opex budget would impact 2020/21 rates by +/- 1.45%.

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Other work we’ll do in 2020/21Some other specific work we’ll do and additional budget items for the year include:

→ Prepare for new central government requirements for drinking water safety.

→ Increase maintenance on our older persons’ housing units.

→ Support ongoing funding and partnership opportunities with central government.

→ Support economic development in the district, including continuing work on the Economic Development Strategy refresh, and contributing to Elevate Ōtaki.

→ Commence maintenance on new Council reserves and work on cycleways, walkways and bridleways on local routes.

→ Deliver the Takutai Kāpiti community-led coastal adaptation programme.

→ Improve our information and communications technology to be more efficient and resilient and provide better online services to customers.

→ Start on improving affordability and availability of housing.

Ongoing delivery of services As far as possible, we will continue the range of work and initiatives planned across all areas of our activities and services. You can find the details of what we’ll do and what it will cost in the LTP – online at Long term plans, or in hard copy at any of our libraries and service centres. You can also see a summary of the key work in each area in the document Our activities and services.

We’ll also continue to respond to service requests for things like road maintenance or issues to do with any of our facilities or parks and reserves.

All service levels, such as upkeep of parks and playgrounds, will be maintained except when alert levels prevent or limit work (as under COVID-19 alert levels 3 and 4).

Possible changes to the work programmeAs noted, depending on the impacts of the pandemic, we may not be able to deliver all the projects to the extent planned. If we need to change the work programme substantially, we will communicate this and, if appropriate, consult with the community.

Prepare to rebuild the Paekākāriki seawall

We will begin the tender process for the construction contract – $158,000 ($50,000 of this is for stormwater outlets replacement). Read more about the seawall project.

Develop Otaraua Park

We will begin construction of stage 1, an amenity block – $1.5 million over the next two years. Read more about Otaraua Park.

Progress the Kāpiti Island Gateway Centre project

We will complete detailed design and other preparatory work for the building of the Gateway Centre – $250,000. Read more about the Gateway Centre.

Consult on design for a new Waikanae Library

We will progress work on a long-term solution for the Waikanae Library – $105,000. Read more about the Waikanae Library project.

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Work deferred to LTPAs mentioned by the Mayor, prior to the pandemic we had planned to consult on a work programme that included an increasing focus on some of the social and environmental challenges facing the district. Though we still have a firm commitment to our responsibilities in these areas, some additional activities will be deferred to the long term plan process later in the year.

The initiatives that were to be proposed, but are not included in the draft Annual Plan, are summarised at right.

Enabling better access to affordable housingCouncil had hoped to add $2 million to our capital spending budget for strategic property purchases. This would have:

→ provided scope to buy land for housing, or make it available for development

→ increased our capacity to support better access to housing in the district.

Increasing sustainability and resilience Minimising wasteTo reduce the amount of waste going to landfills, Council had hoped to introduce up to four community recycling stations across the district, beginning with a trial at Paekākāriki.

Reducing Council’s carbon emissionsTo get us closer to our carbon neutrality goal, Council had hoped to replace more conventional vehicles in Council’s work fleet with electric vehicles or hybrids.

Empowering community boards to support local initiativesAs part of the move towards localism – encouraging local solutions and initiatives – Council had hoped to trial a small fund for Community Boards to allocate using a community participation process.

These projects have been removed from the draft Annual Plan but will be considered as part of the 2021–41 Long Term Plan.

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Our initiatives to respond to COVID-19

As described by the Mayor, Council is developing a staged plan for helping our community deal with the impacts of the COVID-19 pandemic. We are applying a three-pronged approach: sustain, restore, and rebuild. This will run alongside our year three long term plan (LTP) work programme, and form part of our Annual Plan for 2020/21.The first stage, a support package of immediate response actions, is underway. Further initiatives are being explored and will be designed as we receive detailed information about the specific effects of the pandemic on our district. Throughout the year Council will monitor the impacts and consider how it can help. This may be with specific new initiatives, or it may involve reprioritising budgets and refocusing planned activities.

How we respond further will also depend on what additional action central government takes. An important part of our response is helping our district’s families, businesses and organisations get the support the Government is offering, and helping people make use of the incentives that Government provides. This applies to Council as well. As the Chief Executive outlined, we will be pursuing all opportunities for the district to benefit from central government assistance and investment.

Immediate response – multi-stage community support packageThe Council has agreed the following actions to help those households and businesses that are struggling financially due to COVID-19. They apply immediately.

→ Introduce a six-month rates payment deferral for property and water rates instalments due between 1 March 2020 and 30 June 2020, provided a payment plan of up to two years is arranged.

→ Remove penalties for late payment of property and water rates until 30 June 2020.

→ Offer 90-day credit terms for other payments due to Council, such as sports ground fees and solid waste charges.

→ Refund consent deposits and fees if an applicant requests to withdraw their application.

→ Refund a quarter of fees for food, alcohol and outdoor dining licenses fully paid in 2019/20 (we will do this automatically).

→ Pay suppliers faster – within seven days of receiving invoices, if possible.

→ Increase weighting for local businesses in procurement processes.

→ Waive major Council commercial tenants’ rent payments for three months.

→ Allow Community Boards to repurpose unallocated discretionary grant funding for 2019/20 towards COVID-19 response initiatives.

→ Allow community organisations to repurpose remaining social investment grants in 2019/20.

→ Extend existing library loans to 4 June 2020 (applies to all resources borrowed).

For all details, including how to apply for help, go to our Support package page or call 04 296 4700 or 0800 486 486.

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The Council’s welfare support helpline (available by calling 0800 486 486) is open for people who have no local support (whānau, friends or neighbours) to help them access essential goods and services.

Local iwi are planning and implementing their COVID-19 pandemic response plans, and are being supported by the welfare team of the Council’s Emergency Operations Centre and Iwi Partnerships Team. Council officers have worked in partnership with Te Whakaminenga o Kāpiti to repurpose their unspent 2019/20 budget; and $30,000 has been provided to each iwi to help them deliver their COVID-19 pandemic response plans and begin recovery planning.

Further response initiatives Further initiatives are being explored and will be confirmed as we know more about the impacts of the pandemic for Kāpiti. This will include working with iwi, working with business on economic development, and collaboration with community organisations on welfare. As described, Council may repurpose 2020/21 funding to further support the community.

Our budget and financial summary

Our draft Annual Plan includes our budget for the proposed work programme and our intended approach to financial management for the year.For 2020/21, we have developed our budget overall in the context of our long term plan (LTP), and adjusted it specifically to deal with the impacts of COVID-19.

Our budget and financial approach reflect the Council’s decision to have a two-fold focus to this Annual Plan: deliver the work programme for year three of the LTP, and support our community’s recovery from COVID-19.

This section explains the financial decisions Council has made about how we fund the plan, what this means for households and businesses, and how it affects our financial strategy for our district.

Our financial approach for 2020/21The draft plan for 2020/21 has meant some changes for how Council manages its budget for the year, both from what was signalled in the LTP and from what was proposed before the impacts of COVID-19 were known. To fund the core work programme and support the community’s recovery, Council has adjusted each key element of our finances: borrowings, capital spending, and income from rates.

BorrowingsOur work programme to upgrade and replace infrastructure and develop facilities for the district is funded by income from rates and borrowings. For 2020/21, Council is forecasting our net borrowings will sit at $166 million. This is lower than in the draft plan being prepared before COVID-19, when Council had intended to consult on increasing our borrowings to $172 million, and in the LTP, where we forecast that borrowings may go up to $188 million.

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In our financial strategy our preferred limit is to keep our borrowings below 200% of our operating income – we call this our ‘green-line strategy’ (shown in the graph below as a dotted line). Looking at borrowing against income shows how well an organisation is placed to handle and repay borrowings in the future, and it was one of the key measures used by financial rating agency Standard & Poors when they improved our credit rating from A+ to AA in October 2019.

Over the past five years we have been implementing a strategy to transition to fully funding depreciation of our assets through our income from rates, so that we are in a strong position to borrow in the future when we need to invest in new infrastructure. Every dollar of depreciation that is not funded by rates income needs to be funded by borrowings. More explanation on funding depreciation is given in this discussion paper by Local Government New Zealand.

Council had been proposing that for 2020/21 we would continue to transition to fully funding

depreciation, as planned in the LTP. However, to reduce the rates increase to 2.6%, Council is proposing that for 2020/21 we don’t increase depreciation funding at all. This means we will need to fund a shortfall in rates through borrowings (approximately $1.2 million). This keeps rates lower now but means that our borrowings for non-funded depreciation now peak at $48.5 million whereas in the LTP we had expected to be at $46 million. This in turn increases our borrowing costs and prolongs fully funding depreciation by three years from 2022 to 2025.

We have been fortunate in the last couple of years that we have been able to keep borrowings lower due to increased development contributions and proceeds from property sales. Where we haven’t needed to spend money, we have paid back borrowings. This has helped us be in a position to adjust our borrowings and repayments for the coming year to ease the burden on the community at this time.

250

200

150

100

50

0

$ m

illio

ns

Our borrowing projections compared

Borrowings due to unfunded depreciation Net borrowings within 200% of operating income

All other borrowings Projected borrowings per 2018–38 LTP

2019/20 2020/21 2021/22 2022/23 2023/24

The graph shows our projected borrowings according to the draft 2020/21 annual plan and how they are divided between borrowings due to unfunded depreciation and other borrowings. The grey line shows the total borrowings as we had projected them back in 2018 in the LTP. The dotted green line shows our preferred limit for borrowings in our financial strategy, which is 200% of our operating income – our green-line strategy. We have an upper limit for total borrowings of 240% of operating income but we have kept within 200% since setting the limits. You can see that Council’s planned total borrowings for 2020/21 are well below our previous projections and within our preferred limit.

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Capital spending To contain costs for 2020/21, Council has restricted capital spending for the year to $38 million, which is the upper limit of our financial strategy. If we can deliver all the projects in the work programme that cost will be around $37 million, so the higher cap gives us some flexibility.

Council will look at the capital works programme again in detail at the end of the last quarter of 2019/20. By then, we will have a better understanding of how the pandemic has impacted our work over the past months, including work that has not been able to be completed and needs to be carried forward to 2020/21. We will also have more information about the impacts of the pandemic on the district and what is happening in the economy, including possible central government funding.

As shown in the summary of our main projects, our capital works programme is mostly essential work on assets and some development work – all of which will contribute to restoring and rebuilding our district’s economy.

Rates income Our district’s income from rates is Council’s main source of funding for operating costs. Kāpiti is heavily dependent on rates, as we don’t have other income-earning assets such as ports, which some other councils have.

For 2020/21, Council is limiting the amount of extra funding from rates income for operating expenses to $2.1 million, which translates to the average rates increase of 2.6% per ratepayer.

Council gets some additional income – about 11% – from fees and charges. The pandemic has already affected this revenue with around $1.4 million income lost due to facilities such as our pools and other venues being closed because of COVID-19.

Of our income in 2020/21, $250,000 will go towards our recovery plan for the district. We may also repurpose some other funding during the year where required. Council has used part of the rates surplus from 2018/19 to reduce the rates increase for 2020/21. We will manage spending closely, focusing on supporting communities and business, and continuing to see where our funding is best spent.

6.0%

5.0%

4.0%

3.0%

2.0%

1.0%

0.0%

Our proposed rates increase for 2020/21 compared with previous two years

Contribution to fully funding depreciation Increased depreciation

Increased operating costs Inflation

2018/19

0.7%

1.4%

1.4%

1.3%

2019/20

1.6%

0.4%

1.5%

1.3%

2020/21

2.0%

0.6%

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What does the proposed rates increase mean for my property?While the proposed average rates increase across the district for 2020/21 is 2.6% – around $1.65 per week per ratepayer – the actual increase will be different for different properties, even in the same area. This is because property rates are calculated using a combination of fixed charges, land value and capital value. Land value and capital value are assessed independently by Quotable Value New Zealand Limited.

The chart below gives the draft rates for the median property value in each community board area and for rural and commercial properties.

To see what the proposed rates increase would mean specifically for your property, you can use the Council’s rates calculator.

When Council is determining the level of rates income needed, and the average rates increase, it considers the total number of properties in the district. This number has been steadily increasing over recent years, which means the rates income required by Council is spread across more properties. For 2020/21, given the uncertainty in the economy, Council has decided to take a conservative view of possible growth in the number of properties of 0.4%, where our LTP projection had been 0.7%.

Draft rates for 2020/21 across the district

Median Property Values PaekākārikiParaparaumu/

Raumati Waikanae Ōtaki Rural Commercial

Capital value $540,000 $510,000 $520,000 $325,000 $760,000 $600,000

Land value $285,000 $240,000 $265,000 $139,000 $410,000 $360,000

Total current rates $2,918 $3,070 $3,194 $2,515 $1,858 $3,541

Total proposed rates $3,041 $3,164 $3,295 $2,548 $1,960 $3,669

$ Increase per year $123 $94 $101 $34 $102 $128

$ Increase per week $2.36 $1.81 $1.95 $0.65 $1.97 $2.46

% Increase 4.2% 3.1% 3.2% 1.3% 5.5% 3.6%

For urban properties, includes water rates for typical water usage (fixed and volumetric) of 255m3 per year. For commercial properties, includes fixed water charge.

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Help with rates If you’re a low-income homeowner or retirement village resident who holds a licence to occupy agreement, you may be eligible for a rates rebate from the government. To find out more see the government’s Getting a rates rebate page.

If you have extreme difficulties paying your rates, Council may be able to help reduce your rates payments. This includes help for temporary hardship, ongoing situations, and some other circumstances. For information about who is eligible see Rates remissions on our website, or give us a call on 0800 486 486, or email kapiti.council@kapiticoast.govt.nz

Additional COVID-19 relief Council is offering additional help with rates as part of the community support package for COVID-19.

→ A six-month rates payment deferral for property and water rates instalments due between 1 March 2020 and 30 June 2020, provided a payment plan of up to two years is arranged.

→ Removing penalties for late payment of property and water rates until 30 June 2020.

Services funded by ratesMost of Council’s day-to-day activities and the services we provide are funded by rates and fees and charges. For a full list of services see our A-Z of Council services.

Water rates – no increasesAs part of our pandemic response, the Council has decided to keep water rates the same for 2020/21 rather than passing on increased costs to households.

Council will manage this by funding a portion of our water supply operating costs by borrowing, rather than through rates. This means that it will take us longer to achieve our goal of a ‘break-even’ water account.

Help with water ratesWe continue to offer help with water rates for large families with high water costs. For details, see Water rates remissions on our website.

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Fees and charges – no increasesOne of the decisions Council has made to help ease the burden of COVID-19 is to keep fees and charges for 2020/21 the same as they are currently. No fees or charges will increase, and Council is not adding on any costs for inflation. A couple of charges will decrease; see details of this below.

Fees and charges cover everything from hiring halls to applying for building consents, and account for about 11% of our revenue. We review fees and charges for our services and facilities each year as part of the Annual Planning process. This includes looking at the real cost of delivering those services, and any changes to how the services are provided, such as extended hours, or how they are being used by the community. We also want to make sure that any subsidies, such as those for Gold Card holders and Community Services Card holders, remain reasonable. We also look at inflation and, generally, each year we increase most fees and charges in line with inflation.

In our initial development of the draft Annual Plan prior to COVID-19, we reviewed the appropriateness of our schedule of fees and charges, and had planned to propose some adjustments and incorporate inflation which for 2020/21 is indicated as 2.3%.

In the further work Council has done on the budget to reflect the impacts of the pandemic, it has decided to make no increases to fees and charges for 2020/21.

Proposed decreasesCouncil is proposing three small decreases. We will:

→ halve the hire charge for bestseller books and DVDs in all our libraries, to encourage people to borrow these resources – bestsellers will be $2.50 and DVDs $2

→ reduce the cost for businesses offering outdoor dining – renewal fees will be halved to $95 per year

→ remove the fee for marginal and temporary exemptions for events such as fairs and festivals.

You can see all the fees and charges on our Proposed Annual Plan 2020/21 page. This year we will be passing the schedule of fees and charges ahead of the Annual Plan, on 28 May 2020, so that dog registrations can get underway.

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What does the draft Annual Plan budget mean for progress against our LTP?The proposed annual plan takes us into the third year of our current LTP, and completes the three-year focus of the LTP. Even though the Annual Plan for 2020/21 has the additional focus of responding to COVID-19, looking at the three years together we are on track with our financial strategy.

We will have:

→ brought borrowings down (though not as much in 2020/21 as originally intended)

→ kept the total rates below the amount forecast

→ spent less on capital works by reprioritising work into future years where it has made good sense to do so.

We have managed our capital programme carefully, deferring work where we can, and advancing it where we see a critical need. For example, we extended the completion date of our drinking water safety and resilience programme to ensure we had

first reviewed our procurement processes to maximise the value for residents. We now plan to complete about half the programme in 2021/22, finishing in 2022/23.

In terms of meeting key needs in our community, in 2020/21 we have budgeted to do more maintenance and upgrades to our older persons’ housing; and we are making additional contributions to our community’s wellbeing through our pandemic response.

In summary, our total borrowings, capital spending and rates income for the three years 2018–21 are all lower than our LTP projections.

Our borrowings will sit at $166 million where our LTP projection was $188 million. Our capital spending for the three years will be $82 million against our LTP projection of $94 million. The average capital spending per year will be $27 million (LTP = $31 million). Our rates income for 2020/21 will be $71 million, down from our LTP projection of $73 million.

Total net borrowings, capital spending and rates income for 2020/21 compared with LTP forecast

Total net borrowings (at June 2021)

Capital spending (annual average 2018–21)

Rates income (in 2020/21)

2018–38 LTP forecast2020/21 draft Annual Plan

$166m$188m

$27m $31m

$71m $73m

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How to get further information, ask questions and comment

Where do I find more information about the work programme?You can read about the direction agreed with the community, our overall work programme, and the work planned for the coming year in the Long term plan 2018–38 on our website. Details of planned capital spending are in part two of our long term plan (LTP).

The full Annual Plan will be put up on our website within a month of its adoption on 25 June 2020 and will be available in hard copy in our libraries and service centres. The LTP is also available to be read in hard copy at these locations.

Where do I find more information about COVID-19 support?We have created a dedicated COVID-19 section of our website, which we will be updating regularly. We expect to keep it going throughout 2020/21.

In this section, you’ll find details of all our response initiatives already underway, and as we develop further ways to support our community these will be included here too. You’ll also find information about support available from central government and links to access it.

Can I give feedback on the draft plan?We are not calling for submissions on this Annual Plan because it is based on the LTP, which is already agreed. We are also not asking for proposals or funding requests because Council has no scope to consider them for this Annual Plan. Council is prioritising any extra capacity for supporting the community’s recovery from COVID-19, and proposals that Council had been considering, including requests from Community Boards, will be looked at again as part of the development of the next long term plan when that gets underway later this year.

However, Council is always interested in your views. If you have questions or comments let us know by 5pm Friday 29 May. You can:

→ email annualplan@kapiticoast.govt.nz or phone 04 296 4700

→ get in touch with a councillor or community board member

→ speak at a Council meeting; email annualplan@kapiticoast.govt.nz or phone 04 296 4700 to find out more.

If you have questions or suggestions about our pandemic response, contact us any time. You can email kapiti.council@kapiticoast.govt.nz or phone 0800 486 486.

To apply for support, you can register online or phone 0800 486 486.

For details of all our initiatives, see our dedicated COVID-19 website section.

How will the final Annual Plan be decided?During May, Council will consider the latest information on:

→ the pandemic and the impacts on our district

→ what this means for our work programme and response initiatives

→ any further opportunities to reduce costs.

We will also consider the questions and comments we receive. Council will deliberate the final content of the plan in June, and the plan will be formally adopted and rates set on 25 June 2020. The full plan will be available online and in hard copy at our libraries and service centres.

Thanks for taking the time to read this information. We look forward to working with the community in the challenging year ahead.

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