Hamilton City Council has set the direction for far-reaching changes in the way the city’s drinking water and wastewater services are delivered.
The proposed changes respond to new requirements on councils by Government, and the desire for the city and the region to find greater efficiencies across water services. The decisions mean options for a new, council-owned water services company will be developed over the next six months ahead of full public consultation early next year.
The proposal will eventually see separate charging for waters in Hamilton, while spreading costs of major infrastructure investment across the future generations that will benefit.
At today’s meeting, Council confirmed its preferred long-term solution would be a multi-council regional asset-owning waters company which provides stormwater services to its shareholders. In the shorter term, Council is developing a standalone council-controlled organisation with provision for other councils to join in the future.
Noting that Watercare is ending its contract with Waikato District Council (WDC), today’s decisions included that staff consider an option to supply water services to WDC. Any work on this option is subject to WDC formally endorsing collaboration with Hamilton City Council.
Mayor Paula Southgate is pleased Council unanimously supported the proposal.
“Investment in waters, delivering safe, high-quality, well-maintained waters services, is an absolute must do for Hamiltonians.
"But, as I have said for some time, that the costs of that are huge and growing. Over the next 10 years, Hamilton has budgeted almost $4.5 billion in operational, and capital spend to maintain and provide core water infrastructure and services.
“Recent government policy announcements have also directed us to provide zoned and serviced land to accommodate 30 years of future growth. So, the pressure is on.
“Today’s decision provides direction for us to explore and talk to communities about a fundamental change in how we manage water.
“What we agreed today is that waters is a long-term investment, and so we should spread the cost across the generations that will benefit.
“We know we can reduce cost increases through doing things differently. This includes finding efficiencies through working together,” said Mayor Southgate.
Council will ring-fence and show all waters costs and revenue by mid-2025 and design a Hamilton-only CCO model as a baseline option, able to be established by 1 July 2026. The design of this CCO must enable other regional partners or shareholders to be able to join in the future.
It agreed that the regional proposal, ‘Waikato Water Done Well’ does not meet the city’s needs for an option which rapidly improves Hamilton’s ability to fund for growth.
For complete transparency of waters-related financial activity, Council will need to separate waters related charges from the General Rate and Uniform Annual General Charge and change the Development Contributions policy. These decisions will require a Long-Term Plan (LTP) amendment next year.
Council noted implementing the approach confirmed at the meeting will have consequential financial and other impacts which need to be addressed:
- The costs of making the changes required by Government are new and accordingly are largely unbudgeted.
- Initial estimates of the cost to establish a Council-only CCO are between $5M and $6M.
- A draft budget to implement these decisions will be prepared by December this year.
- Full consultation and engagement will be needed before any change to service delivery is confirmed.
- Consultation must include specific engagement with iwi due to the impacts any change will have on existing partnership structures, full consultation through a change process with affected staff, formal public consultation though the LTP amendment and communication to ensure our communities understand Hamilton’s water services, the issues we face and our responses for the future.
The full report is available on the Council’s website with minutes available shortly after the meeting.
Read more at hamilton.govt.nz/localwater