10 February 2005

Mayor Dick Hubbard announces congestion buster budget package

Auckland City’s Mayor today announced a package that will drive an additional $60 million into business and community development during the next three years.

The package would be part funded by a 9.7 per cent rates rise, more than half of which would speed up the city’s public transport and roading projects.

It is supported by the Mayor, Dick Hubbard, Deputy Mayor Dr Bruce Hucker and Finance Committee chair Councillor Vern Walsh and will be put to a vote at the council’s annual planning meeting on 15 February.

Subject to a final vote on 9 March the proposal will be released for public consultation as part of the draft annual plan on 20 April.

“With this package we put the city’s foot down hard to accelerate all the major transport projects within our city boundary and within our power,” said Mr Hubbard. “As well as being a congestion buster, the package puts a firm focus on maximising the benefits of being a growing city – while making this a better place to live.”

The rise is made up of a 2.7 per cent allowance for inflation as well as new targeted rates for all ratepayers which, over three years, would deliver approximately an extra:

$42 million for transport projects (5 per cent targeted rate, raising an extra $14 million a year, plus resulting extra transport subsidies from central government) $8.4 million for open space, particularly preserving the city’s volcanic cones (1 per cent targeted rate, raising $2.8 million a year)

$4.2 million to focus on urban design and heritage preservation (0.5 per cent targeted rate, raising $1.4 million per year)

In addition, the package will:

continue to support the business community by implementing the next stage of the rates differential policy which reduces the rates burden carried by business ratepayers, and investigate housing partnerships which would bring their workers closer to them

redistribute the rates load so it is fairer, by reducing the uniform annual general charge (UAGC), introduced by the previous council, from $189 to $95

keep other major programmes, including the targeted rate for the central business district’s redevelopment, which will see a total of $200 million pumped into the area over the next 10 years

investigate partnerships to further community initiatives and affordable housing with a budget of $1.4 million per year (0.5 per cent rates increase)

provide approximately $2.4 million over three years to compensate low-income residents who are least able to afford rate increases and wastewater charges.

Mr Hubbard said Aucklanders had made it very clear over the past six months that they wanted to live in a vibrant, prosperous and more inclusive city, with transport, urban design and open space made top priority.

“We believe we can deliver on that challenge. Transport is our top priority and I will be putting pressure on our partners in the transport area to keep pace with us. We are acutely aware that an effective transport system is vital to grow Auckland’s economy.

“With this package we focus on better urban design and preserve more of our beautiful old buildings and our magnificent heritage, like the volcanic cones.

“We will also look at new community initiatives with partner organisations, including ways to increase the amount of affordable housing, but which do not involve getting back into full ownership and administration of rental property ourselves.

“We’ve made the decision to reduce the size of the uniform annual charge that all ratepayers pay because its introduction in the previous term of council meant many of our people on the lowest incomes were hit with a 37 per cent increase, while people in high value properties saw less than a 5 per cent rise. By reducing it from $189 to $95 we make Auckland a more equitable place to live,” said Mr Hubbard.

Finance and Corporate Business Committee Chair Councillor Vern Walsh said the combined power of the new targeted rates would have a huge effect on what the council could achieve over the next three years.

“Every dollar of the targeted rates is ring-fenced for its specific purpose and is additional to the current budget which means a $60 million shot in the arm for delivering results,” said Mr Walsh. “Over the next three years the council will spend around $1.4 billion. I will be running the city’s finances extremely tightly to make the most of the investment from ratepayers.”

Deputy Mayor Dr Hucker said he was delighted that the city’s leaders had reached agreement on this pivotal package.

“Today the Auckland City Council confirms it is pro-business, pro-growth and pro-community,” said Dr Hucker. “This package sends a powerful message about the degree of agreement which can be achieved among the majority of councillors.”

Transport

Transport remains Auckland City’s number one priority.

The proposed 5 per cent targeted rate for transport will allow an additional $42 million in transport expenditure over the next three years. Every dollar the targeted rate delivers for will be spent solely on transport projects.

The transport targeted rate will enable the council to accelerate its transport programme including public transport and roading.

In summary, the focus of the targeted rate for the financial year ending 30 June 2006 will be:

Bus priority improvements ($2.5 million) Dominion Road Passenger Transport Corridor design ($680,000) Cycle, walking, parking improvements in town centres ($1.2 million) Project Greenlane ($4.8 million) Neilson Street design ($700,000) Land acquisition: ($4.1 million) Tamaki Dominion Road Great South Road Neilson Street Tiverton/Wolverton

The council will place greater emphasis on passenger transport, walking and cycling, and other techniques to manage travel demand. This includes working with local communities, schools and businesses, increasing travel choice and reducing car dependence for travel to school and work.

The council is already committed over the next 12 months to completing the Fanshawe Street bus priority lanes that form part of the Northern Busway, and rail station improvements at Otahuhu, Remuera, Greenlane, Penrose and Mt Eden. The council is also close to making a final decision on the central transit corridor.

The new targeted rate will allow the council to bring forward an additional $2.5 million of bus priority measures across the city’s arterial road network, improving efficiency for passenger transport on Remuera, Great South, Manukau, Mt Eden and Sandringham roads.

The council has embarked on a programme to purchase the land required for the Dominion Road passenger transport corridor. The targeted rate will give a significant boost to this project ($680,000), enabling the major elements of the detailed design to begin. Longer term, the targeted rate will enable Dominion Road to be widened, incorporating extended bus priority measures, resulting in increased people carrying capacity.

The council will also be increasing its advocacy with the Auckland Regional Council and Auckland Regional Transport Authority (ARTA), to provide additional and improved passenger transport services.

The council will complete construction of the Waikaraka cycleway and increase its focus on improving cycle, walking and parking management in and around town centres and in conjunction with the rail network improvements ($1.2 million).

The council will also focus on improving the existing road network, undertaking strategically significant land purchases to allow future improvements. These will focus on Dominion Road; Great South Road, Greenlane; Neilson Street, Onehunga; and the Tiverton Wolverton corridor in Blockhouse Bay, as well as facilitating new local roading solutions to support the residential and business growth in Tamaki.

The council has decided to re-scope the eastern transport corridor project to remove the highway component from Glen Innes to the CBD, while protecting the corridor for future development of transport infrastructure. This includes developing passenger transport corridors and investigating local roading improvements for the business, university and residential developments in Tamaki.

The targeted rate will secure the funding needed for the early delivery of the planned Project Greenlane, a $10.6 million upgrade of Great South Road, Greenlane. The improved route is designed to accommodate 40,000 vehicles per day with better passenger transport, cyclist and pedestrian safety. Some $4.8 million will be spent on this project in the next financial year. The targeted rate will also mean detailed designs for Neilson Street, Onehunga can be finalised. These improvements will support business development in the area as well as improving access to the state highway network along this major freight route.

Longer term the targeted rate will be able to fund ongoing improvements to the network including projects associated with Transit New Zealand’s and ARTA’s 10 year programme, for example the Tiverton Wolverton corridor and further town centre cycle, walking and parking improvements.

CBD Project

Auckland City will invest more than $200m in the Central Business District (CBD) over the next 10 years to ensure its place as an internationally competitive business and cultural centre. This includes $103m of funding through the CBD targeted rate.

The three-year action plan adopted in July 2004 will be supported in this package.

Streetscapes projects costing $94 million will be implemented over 10 years:
Project Approximate cost
Queen Street upgrade $23.2 million
Aotea Square $10.6 million
CBD core streets and lanes $9.3 million
Quay Street $7.4 million
Victoria Street/Wellesley Street $6.9 million
St Patrick’s Square/Federal Street $6.5 million
Hobson Street/Nelson Street $6.4 million
Albert Street $5.5 million
Lorne Street $4.5 million
Beach Road $4.4 million
Projects totalling $66 million will be funded over the next three years and include:
Project Approximate cost
Transport initiatives $43 million
Art gallery redevelopment $20 million
Planning in CBD with focus on urban design $1.25 million
Encouraging investment in the CBD $300,000
Public activity and events $200,000
Other key projects in the CBD include the Auckland Arena with a $68m contribution from Auckland City and the $350m Britomart above ground project, New Zealand’s largest heritage redevelopment, to be carried out by the Bluewater consortium, and including the renovation of 17 heritage buildings.

Community initiatives and affordable housing

58 per cent of Housing New Zealand’s waiting list is in the Auckland region.

Groups like the Employers and Manufacturers Association have been clear that the lack of affordable housing in Auckland has been causing huge problems for employers.

If people buy on the outskirts of the Auckland region and have to travel kilometres into the CBD, that adds to traffic congestion.

Like other councils, Auckland City wants to see how it can help, not with a blank cheque but by developing partnerships on practical projects with business, government or NGOs, which would allow working families to live closer to their workplace.

As an example, Waitakere City is in an industry-led partnership with the private sector which provides a win-win for business and local government.

The council will be looking at new ways of doing things, not the old. Auckland City is not intending to get back into owning and administering pensioner or any other sort of rental housing.

Having said that it should be noted that Auckland City is the only city that has deliberately exited pensioner housing. It is the only council in wider Auckland which does not have any housing.

There is provision in the budget package for $1.4 million each year for the next three years to look at seed funding for new partnerships in this area as well as other community initiatives.

As an example, the council will be using some of this funding to make community centres more accessible by reducing charges. Officers will be reporting further on unfunded community initiatives that could potentially benefit from this new funding.

Heritage and urban design

The targeted rate of 0.5 per cent will generate $1.4 million each year in new funding for heritage and urban design.

The new funding will:

provide additional protection for natural and built character and heritage

ensure quality urban design through appropriate guidelines, incentives, and planning rules and consents

ensure good planning provides for population and business growth

complete an over-arching urban design and form strategy for the physical and built environment of the city.

This plan reflects what Aucklanders have told Auckland City they want for the city:

a more proactive approach to building a more liveable city

giving urban design and heritage the focus they deserve, and

in particular good urban design around transport hubs in growth areas.

10 February 2005 Auckland City Council budget package

Open space and volcanic cones

A 1 per cent targeted rate would enable Auckland City to raise an additional $2.8 million each year.

This will help Auckland City provide more parks, reserves and open areas. The city is expected to grow by over 60,000 people in the next 10 years.

Funding from the targeted rate will allow new land to be purchased across the city where it is needed most for public open space. The purchase of land adjacent to existing reserves will also be considered to improve their useability. It may also be used to improve the overall quality of some Auckland reserves that are not eligible for funding from development levies.

A priority for the targeted rate will be improvement projects for two of Auckland’s most significant volcanic cones - Maungawhau/Mt Eden and Maungarei/Mt Wellington. About $2 million will be allocated to each mountain over three years. The projects will include: improving or creating visitor facilities and interpretive signage upgrading pedestrian facilities and track networks protecting archaeological, geological and historical sites managing and controlling vegetation.

The next priority for improvement projects will be other volcanic cones around Auckland, including Taurere/Taylor Hill, Titikopuke/Mt St Johns, Remuera/Mt Hobson, Puketapapa/Mt Roskill, Otahuhu/Mt Richmond and Owairaka/Mt Albert.

The targeted rate will help the city to manage all the cones in the most effective and efficient way from both a planning and operational perspective.

Rates summary

Total impact of proposed rating policy, including UAGC at $95

The average residential rates bill will be approximately $1200. The average/mean increase for residents in Auckland City will be 11 per cent, or about $120 per year. The average increase for a business in the CBD will be 7.9 per cent. The average increase for a business outside the CBD will be 9.1 per cent.
Residential
Low value Medium value High value
Approximate capital value $215,100 $311,300 $556,600
Rates bill $855.95 $1138.66 $1809.41
Dollar impact + $43.50 + $105.01 + $250.94
Percentage increase + 5.4% + 10.2% + 16.1%
The Auckland City Council will meet on 15 February for the second Annual Plan Direction Setting meeting. At the first meeting on 13 November councillors received recommendations from council officers about funding priorities and rating options for the next financial year.

The package to be proposed by Auckland City’s political leaders at the 15 February meeting would see a rates increase of 9.7 per cent including inflation (expected to be around 2.7 per cent).

Each 1 per cent increase results in an additional $2.8 million funding per year.

The majority of this increase (5 per cent or $14 million per year) would be a targeted rate specifically allocated to transport.

An additional 1.5 per cent increase ($4.2 million per year) would be targeted to open space, particularly the preservation of the city’s volcanic cones, as well as an increased focus on urban design and heritage protection.

The final 0.5 per cent increase ($1.4 million per year) would be allocated to community initiatives, including looking at partnerships with Housing New Zealand and others to increase the amount of affordable housing in the city.

The Local Government (Rating) Act 2002 allows local authorities to set a targeted rate for activities that require specific funding. The funding raised by a targeted rate is set aside for the specific activity and cannot be spent elsewhere. The package assumes that the targeted rates will be fixed for the next three years.

The package includes a proposal to reduce the level of the Uniform Annual General Charge (UAGC) from $189 per ratepayer to $95 per ratepayer. This would increase the amount of rates that is calculated based on a property’s value which means high value properties will see a resulting rate increase.

The package includes implementing the next stage of the rates differential policy which reduces the rates burden carried by business ratepayers.

Other major programmes will be retained including the targeted rate for the central business district’s redevelopment, which will see a total of $200 million pumped into the area over the next 10 years (see separate information sheet enclosed)

ENDS

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