Frequently asked questions

High quality water services are crucial for protecting our environment, supporting public health, and enabling sustainable growth, while meeting our regulatory responsibilities. Like many councils, and especially high-growth councils, we face significant future funding challenges for waters infrastructure. This is a national issue, and Government is requiring all councils to look at new ways of delivering services in the future.  

Council is proposing is to form a joint waters company with Waikato District Council.  

The company would be a Council-controlled Organisation (CCO). The company, including all of the water and wastewater assets, would be publicly owned, with both councils as the only shareholders. A CCO would not require more rates than any other option investigated. 

The CCO could not be privatised. Under New Zealand law, it remains illegal to privatise council-delivered water services. This is to ensure they remain in public ownership. 

The joint waters company would be responsible for delivering drinking water and wastewater services across council boundaries. It would build, maintain and operate critical waters infrastructure, based on direction from the council shareholders. Stormwater services and assets would remain the responsibility of each council but they would be provided by the CCO. 

• Critical infrastructure, faster: By joining together, Hamilton City and Waikato District can build the infrastructure our growing communities need, faster and cheaper. This would help unlock housing and industrial development, and would allow both councils to meet their growth obligations (including housing obligations) to the government.   

• Improving the health of the Waikato River: Forming a CCO with Waikato District would enable better management of the river. The CCO would take freshwater and discharge treated wastewater from a much longer (150km) stretch of the waterway. This better supports our obligations to Te Ture Whaimana o Te Awa o Waikato (the Vision and Strategy for the Waikato River). It would also allow us to better respond to waters standards set by the Waikato Regional Council and Taumata Arowai (the national waters services regulator). 

• Spreading costs fairly: The government has changed the rules to give CCOs greater borrowing power than councils. In other words, a CCO can borrow more than a council can. That means costs could be spread more fairly, over a longer period of time. Instead of having to pay off a loan in 30 years, for example, that loan could be spread across a period more closely aligned to the full life of the infrastructure. This would reduce the burden on today’s ratepayers because future ratepayers, who would also use the infrastructure and services, would also pay their fair share. In the case of a natural disaster, critical infrastructure could be rebuilt or repaired faster, because the CCO would have more access to funding.  

• Greater purchasing power: The joint CCO, working for both the city and Waikato District, would service many more households and businesses. It would be a more cost-efficient organisation, solely focused on waters with greater purchasing power for waters services. Over time those savings and operational efficiencies will be passed to ratepayers. This has been the case around the world, including in Auckland where a CCO (Watercare) has been responsible for waters services since 1991. 

• Securing expertise: New Zealand has a shortage of waters specialists and our waters workforce is ageing. We need more skilled people. Affected waters staff at both councils would transfer to the CCO. A larger waters organisation is more likely to attract and retain the specialist staff we need to keep our water infrastructure working well. 

The alternative would see Hamilton City Council establishing an internal business unit, within the wider Council organisation. The business unit would be ‘separate’ from the rest of the organisation and would focus only on managing drinking water, wastewater and stormwater.  It would be separated financially from the rest of the Council and would still be required to generate revenue through separate targeted rates and water charges.  

We’re providing this option in order to meet a Government requirement that all councils provide their communities with a second option to consider.  But  this option is not supported by Council as it would not support the core objectives we need to achieve for our city. In particular it would be unable to better respond to growth pressures across boundaries. 

A range of options were considered and are outlined in this Business Case. Forming a joint water company with Waikato District Council is the one preferred by Council.

However, the Government has required that all Councils also provide their communities with a second option to consider. 

There is no difference in total rates collected by the city under either of the options. The total rates add up to the amount approved by Council through the Long-Term Plan.  

There will be some adjustment to rates for individual properties due to the city-wide revaluation. But instead of the cost of waters services being covered by your general Hamilton City Council rates bill, you’ll be able to clearly see what portion of your rates goes towards waters.

A CCO would be governed by a group of appropriately skilled, independent directors with the right mix of expertise to make critical decisions about long-term, critical infrastructure. Both shareholding councils would appoint the directors. 

The Board of Directors must meet clear expectations set by shareholding councils and their elected representatives. Each year, CCOs must formally report back to their shareholding councils, to ensure those expectations are met.  

The Commerce Commission would provide oversight (of either a CCO or business unit) to ensure it is well managed financially and meets its legal obligations in terms of waters charges.  

Taumata Arowai already requires councils to meet their water quality obligations, and it will require the same thing of a CCO or Internal Business Unit. The CCO would have a direct relationship with Waikato Regional Council in terms of resource consents and compliance. 

Shareholding councils will require the CCO to meet all existing obligations; that won’t change.   

Hamilton and Waikato see forming a joint water company as a potential first step in a broader partnership.  Both councils want to leave the door wide open for other councils to collaborate and potentially merge with the proposed CCO, if that is what those councils choose.  Adding other Councils would create a larger organisation that could further reduce costs, increase efficiencies and enable access to more expertise. For that reason, the proposed CCO would be designed to make any future mergers as seamless as possible. 

In the meantime,  Hamilton and Waikato District have significant growth and funding challenges and need to get on and build infrastructure, in the most affordable way.   

This option would see Hamilton City Council establishing an internal business unit, within the wider Council organisation. The business unit would be ‘separate’ from the rest of the organisation and would focus only on managing drinking water, wastewater and stormwater.   

Under this option the Commerce Commission would continue to provide oversight to ensure Hamilton City Council meets its legal obligations in terms of waters charges. Taumata Arowai will ensure the in-house business unit meets all water and wastewater quality obligations. 

Note, Commerce Commission and Taumata Arowai regulation will apply to any water services model. 

The business unit would need to produce stand-alone financials, a separate waters annual report and a separate waters services strategy (like a long-term plan for waters). This would help meet government requirements for greater financial transparency. 

Existing rules and laws make it complex to work across council boundaries. This option does not easily enable joined-up planning, funding, delivery and operation of waters infrastructure. It would mean Hamilton would continue to operate as a ‘stand-alone’ entity instead of joining with Waikato District (and potentially other councils over time) to work together and more efficiently build and maintain major waters projects. This will adversely impact growth around Hamilton that is managed by Waikato and Waipā Districts. For example, it could potentially impact projects like the much-needed Southern Wastewater Treatment Plant. 

The business unit would be ‘separate’ from the rest of the organisation and would focus only on managing drinking water, wastewater and stormwater.   

At this stage, none. But Hamilton and Waikato both see forming a joint water company as a potential first step in a broader partnership.  Both councils want to leave the door wide open for other councils to collaborate and potentially merge with the proposed CCO, if that is what those councils choose.   

Councils are dealing with increased regulatory rules and costs from government, higher environmental protection standards, soaring infrastructure and insurance costs and new investment needed to deal with growth and extreme weather.  

It is very clear this work cannot be deferred anymore. Our country needs huge investment in waters infrastructure and successive governments have recognised this. In some places councils have reached the limit on how much they can borrow. Critical waters infrastructure upgrades have been postponed to keep rates down. 

Across New Zealand, all councils have been directed by government to consider how they can better, and more cost-effectively, provide waters services in the future. 

There will be water restrictions during periods of very high demand. There is enough water for everyone but it is not affordable or realistic to invest in infrastructure solely to address major peak demands. 

Council already has around 4000 water meters installed on commercial properties in Hamilton. These have been in place for some time and ensure businesses pay for the water they use. 

But the Government wants more transparency around the cost of waters services. All councils (not just Hamilton) will soon be required to show how much revenue is collected for waters services, separately to the other funding councils collect. That means all councils must separately charge for drinking water supply, wastewater and stormwater activities.  This is more difficult (and not as fair) without water meters. 

Within five years, large cities like Hamilton will also be expected to charge for water based on usage. In other words, people will be expected to pay, based on how much water they use. We cannot do that in Hamilton unless residential water meters are installed.  

In the future, waters meters will also likely be a requirement of both the Commerce Commission (as the economic regulator) and the Waikato Regional Council which issues resource consent to take water from the Waikato River. At current usage levels Hamilton will exceed the amount of water it is allowed to take from the River before our next consent review in 2044. In other parts of the Waikato region, the Waikato Regional Council has already required water meters to be installed, as a condition of granting a resource consent.  

Based on these factors, yes, we expect residential water meters will need to be installed in Hamilton in the future.  

If a CCO was formed, timing would be a decision for the CCO. 

If a CCO was not formed, for the same reasons outlined above, Hamilton City Council would still be required to install residential water meters. 

To ensure we can meet government objectives, and to manage a precious resource more sustainably, it is likely to be within the next five years.   

Around New Zealand, councils that already have water meters installed see much more efficient use of water. Often water use can drop as much as 25%. 

Using less water is cheaper for households. But it also good for big water infrastructure assets.  If less water is used, the hugely expensive assets we must all pay for (like water treatments plants) can do the job for longer. We don’t have to pay to replace them as quickly. 

Water meters also help identify water leaks, including on private property. Fixing leaks means we use less water and that’s important. There is only a certain amount of water we can take from the Waikato River and right now, it’s not enough to service our growing city.   

Overall, water meters are also fairer because you only pay for what you use. Those households and businesses that use less water, pay less.  Households and businesses that use more water, pay more.  

The alternative regional CCO model based around rural councils (known as Waikato Water Done Well) does not meet the city’s needs for a solution which rapidly improves Hamilton’s ability to respond to growth.  Right now, it does not offer the certainty we need. 

Under the proposal, from 1 July 2026, Council would no longer be responsible for delivering water and wastewater services. Council’s assets relating to those activities would be transferred to the CCO by that date, and all activities and performance measures relating to water and wastewater would be removed from the Long-Term Plan. 

By 1 July 2026, Council would produce detailed financial schedules for the ‘residual’ Council, which would be subject to review by Audit New Zealand. In the meantime, the high-level financial impacts of this proposal for residual Council are provided in the Business Case. 

Rates calculator

No, not for the 2025/26 rating year. Residential ratepayers on low incomes may be eligible for a rates rebate of up to $790 a year under the Government’s Rate Rebate Scheme, plus $788 a year under the Council Rates Remission Policy. 

Rebates

If Council decides to form a joint waters company with Waikato District Council to deliver water services from 1 July 2026 as proposed in the consultation, we will review the Rates remission and postponement policies next year in preparation for the change. 

In the 2024-34 Long-Term Plan, Council signalled a 15.5% rates increase for 2025/26, and that has not changed. The targeted rates will not be additional to this – ratepayers will simply see the amounts for water, wastewater and stormwater separated out on the rates bill. 

However, ratepayers may see some changes in their rates. In particular: 

• there are some small differences to how the targeted rates will be applied, compared to the existing arrangements. For example, rural residential properties that do not receive a particular service will not pay the corresponding rate, which affects how much we need to collect from other properties.  

• A citywide rates revaluation is currently taking place. The revaluation does not change the total amount of rates we need to collect from across the city, but will affect distribution of rates between different properties. 

Commercial properties currently pay higher general rates than a residential property of the same value. 

When wastewater and stormwater are separated out from general rates, commercial properties will continue to pay more for these services.  

Commercial properties usually pay for water by meter and receive a separate bill for this, while residential properties pay for water in their rates. 

The total amount of rates that a commercial property pays compared to a residential property of the same value is proposed to stay about the same as it is now. 

For example: 

The median residential property in Hamilton has a 2021 capital value of $830,000 and pays rates of $3306 this year. 

Proposed rates for next year are $3828. This includes the separate rates for water, wastewater, and stormwater. 

A commercial property with a 2021 capital value of $830,000 pays rates of $8359 this year— 2.53 times more than residential. 

Proposed rates for next year are $9689. This includes the separate rates for wastewater and stormwater — 2.53 times more than residential. 

Yes, you will still pay for the wastewater targeted rate.  

Trade waste is any liquid which is discharged from industrial or business premises to Hamilton City Council’s wastewater system.  

It is very important that stormwater is not directed into the wastewater system. It is equally important that wastewater and trade waste are not directed into the stormwater system as this can significantly affect both people's health and our environment. 

Stormwater and wastewater systems are very different. 

Stormwater discharges directly to waterways. 

Wastewater is fully treated at the Wastewater Treatment Plant before being discharged to the receiving environment. 

Stormwater is the water that runs off surfaces such as roads, driveways, footpaths and rooftops. It travels down gutters, into sumps and enters the stormwater network to be discharged into waterways.  

Stormwater is not the same as wastewater, which is anything that enters drains inside your home. 

Stormwater is a service that benefits all those in Hamilton. It is a citywide rate as it does not necessarily relate to a physical connection to your property, as the case with water and wastewater, rather a network that is available within the city.