Finance and Performance Committee Sept 14 Agenda Extra Attachments

8/11/2019 Finance and Performance Committee Sept 14 Agenda Extra Attachments

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Note: The reports contained within this agenda are for consideration and should not be construed as Council policyunless and until adopted. Should Members require further information relating to any reports, please contactthe relevant manager, Chairperson or Deputy Chairperson.

I hereby give notice that an ordinary meeting of the Finance and Performance Committee will beheld on:

Date:Time:Meeting Room:Venue:

Wednesday, 24 September 20142:00pmCouncil ChamberGround FloorAuckland Town Hall301-305 Queen StreetAuckland

Finance and Performance Committee

OPEN ADDENDUM AGENDA

MEMBERSHIP

Chairperson Penny WebsterDeputy Chairperson Ross Clow

Members Cr Anae Arthur Anae Cr Calum PenroseCr Cameron Brewer Cr Dick QuaxMayor Len Brown, JP Cr Sharon Stewart, QSMCr Dr Cathy Casey Member David TaipariCr Bill Cashmore Member John TamihereCr Linda Cooper, JP Cr Sir John Walker, KNZM, CBECr Chris Darby Cr Wayne WalkerCr Alf Filipaina Cr John WatsonCr Hon Christine Fletcher, QSO Cr George Wood, CNZMCr Penny HulseCr Denise KrumCr Mike Lee

(Quorum 11 members)

Crispian FranklinDemocracy Advisor

23 September 2014

Contact Telephone: (09) 373 6205Email: [email protected]: www.aucklandcouncil.govt.nz


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ITEM TABLE OF CONTENTS PAGE

15 Monthly Budget Update 5


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Monthly Budget Update Page 5

Monthly Budget Update

File No.:CP2014/19873

Purpose1. This report is provided on a monthly basis as required. It collates decisions required of the

Finance and Performance Committee on changes to the budgets, and provides a financialcontext within which the decisions can be made.

Executive summary2014/2015 capex deferrals

2. On 21 August, this committee agreed to capex deferrals from 2014/2015 for the CouncilControlled Organisations (CCOs), but resolved to further engage with local boards beforeagreeing to any deferrals for Auckland Council.

3. Council staff have reviewed the list of regional deferrals to ensure that this list reflects themost accurate and up-to-date information available, and factor in any other relevantconsiderations such as the application of CBD targeted rate funding. As a result, the list ofregional deferrals has been revised down from $80 million to $74 million. A revised list ofregional deferrals is included as Attachment A.

4. All 21 Local Boards have now considered the list of proposed deferrals at their businessmeetings and passed formal resolutions in relation to this list. The local board resolutionsare included as Attachment B. If the committee were to agree to all of these resolutions, thelist of local capex project deferral would be revised down from $35 million to $21 millionoverall, with some boards having very few or no deferrals.

5. To ensure an consistent approach across all boards, staff have reviewed the local boardresolutions and provided a set of recommendations based on the objective criteria that hasbeen used throughout this process. If the committee were to agree to these staffrecommendations, the list of local capex project deferral would be revised down from $35million to $30 million overall, with all boards having some material level of deferrals.

Recommendation/sThat the Finance and Performance Committee:

a) agree to the list of regional deferrals set out in Attachment A

b) note the local board resolutions included as Attachment B

c) agree to the staff list of local deferrals set out in Attachment C which reflects theapplication of standard criteria across all local boards

d) note that 17 local boards resolved that the capital deferrals be given priority in2015/2016

e) agree that the councils budgets be updated to reflect the financial implications of theabove decisions.

Comments

Background


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6. The Finance and Performance Committee has delegated authority to approve changes tobudgets during a financial year. Rates for 2014/2015 have been set with no provision madefor accommodating new or additional expenditure items. Any new 2014/2015 expenditurecommitted to will either require reprioritisation of existing budgets or increased borrowing.

2014/2015 capex deferrals

7. On 21 August, this committee agreed to capex deferrals from 2014/2015 for the CouncilControlled Organisations (CCOs), but resolved to further engage with local boards beforeagreeing to any deferrals for Auckland Council.

8. Council staff have reviewed the list of regional deferrals to ensure that this list reflects themost accurate and up-to-date information available, and factor in any other relevantconsiderations such as the application of CBD targeted rate funding. As a result, the list ofregional deferrals has been revised down from $80 million to $74 million. A revised list ofregional deferrals is included as Attachment A.

9. All 21 Local Boards have now considered the list of proposed deferrals at their businessmeetings and passed formal resolutions in relation to this list. The local board resolutionsare included as Attachment B. If the committee were to agree to all of these resolutions, the

list of local capex project deferral would be revised down from $35 million to $21 millionoverall, with some boards having very few or no deferrals.

10. To ensure an consistent approach across all boards, staff have reviewed the local boardresolutions and provided an alternative set of recommendations based on the objectivecriteria that has been used throughout this process. If the committee were to agree to thesestaff recommendations, the list of local capex project deferral would be revised down from$35 million to $30 million overall, with all boards having some material level of deferrals.

11. The specific categories used to assess the 2014/2015 council parent capex programmewere:

a) Legally committedLegislative or contractual commitment for delivery in2014/2015

b) Growth relatedDevelopment contribution funded capex but not committed

c) Urgent health and safety renewalA significant health and safety risk that must beaddressed in 2014/2015

d) In tender processSigned procurement plan, currently under tender or about to go totender

e) Cost savingsCapital works that support cost savings

f) Revenue generatingThe investment will be offset by associated revenue

g) RenewalsTo maintain existing levels of service

h) DiscretionaryProjects have flexibility to be deferred and reconsidered through theLTP process

All expenditure in categories a-g is recommended to be retained, while all expenditure in thelast category is recommended for deferral. For some projects the total cost may have beenallocated across more than one category. For example, phase 1 may be committed, butphase 2 remains discretionary.

Consideration

Local board views and implications

12. All 21 Local Boards have now considered the list of proposed deferrals at their business

meetings and passed formal resolutions in relation to this list. These board resolutions areincluded as Attachment B.


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13. Some of these resolutions state that particular projects are a high priority for the board andshould not be deferred, even though the objective criteria for retention are not met. In mostcases, these arguments relate to community expectations and/or previous planning andengagement work. However, there are two specific local projects where the board hasidentified potential efficiency benefits from aligning project timing with other related capitalworks:

Pioneer Womens and Ellen Melville Hall Waitamata Local Board resolved that thisproject should proceed this year to coincide with the upgrade of the adjoining FreybergSquare. While they have resolved not to accept the proposed $1.9 million deferral, theyhave acknowledged that only about $400,000 would be likely to be completed in2014/2015.

Mt Roskill Village Centre Upgrade Puketepapa Local Board resolved that this$527,000 project should proceed this year to align this with Auckland Transports workon Dominion Road which is due to commence in October.

Staff acknowledge the potential benefits of proceeding with these two projects in 2014/2015.However, at this stage they remain on our list of recommended deferrals as they do notmeet our objective criteria for removal from the list.

14. 17 local boards resolved that deferred projects be given priority in 2015/2016.

15. The LTP process will provide the opportunity to discuss with the community the relativeimportance of projects and programmes, based on the priorities identified in the Local BoardPlans.

16. Through September and October Local Boards, the Governing Body, CCOs and council staffwill all contribute to the development of draft LTP 2015-2025 budgets in response to theMayoral Proposal. Decisions on discretionary local budgets will be made by Local Boards inOctober and decisions on regional activities and local asset based services will be made bythe Budget Committee on 5-7 November.

17. Final decisions on which projects are included in the LTP 2015-2025 will be made by 30June 2015, following full public consultation.

Maori impact statement

18. From discussion with Te Waka Angamua early in the process, no individual project proposedfor deferral has been noted as significant for delivering the intended Maori outcomes.

Implementation19. Budgets will be amended in core financial systems and used for internal management

reporting, regular reporting to councillors and financial control for the 2014/2015 financialyear.

Attachments

No. Title Page

A List of Regional Deferrals 9

B Local Board Resolutions 11

C List of Local Deferrals 53

Signatories

Authors Taryn Crewe - Financial Planning Manager - Council ParentRoss Tucker - Team Leader Capital Planning

Authorisers Matthew Walker - Manager Financial Plan Policy and Budgeting


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Andrew McKenzie - Chief Finance Officer


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Documents

Finance and Performance Committee Sept 14 Agenda Extra Attachments