Community to be Consulted on Dam Proposal

Friday 8 September 2017

The Tasman District Council has agreed to consult the public on proposals for funding and governance of the Waimea Community Dam (Dam).  The consultation, to be held before end of the year, will be focused on the benefits and costs of the project on ratepayers and water users throughout the District, and how the dam will be managed.

The current proposal will see the Council fund $26.8 million of the Dam’s remaining $75.9 million cost (of the total $82.5m project cost, $6.6 million has already been spent by the Council and Waimea Irrigators Ltd).

The Council’s share includes an interest-free $10m loan from Crown Irrigation Investments Ltd, reducing the ongoing interest costs to ratepayers to the tune of about $500,000 a year.

The proposal sees a proportion of the Council’s share attributed to environmental/wider community benefit, because of the improvements to river health, recreation and cultural values that will come from increasing flows in the Waimea River, as well as the project’s benefits to the regional economy.

The Council is yet to make a decision on how the costs could be apportioned across the District. That decision will be subject to public consultation. Under the Local Government Act the Council is required to consider how it will allocate the costs and the effect on the community. 

One approach being considered is to;

  1. not charge the urban water account for the environmental /community benefit costs, 
  2. recover the costs of augmenting the urban water supply through the current urban water account using the current cost recovery regime (fixed annual service charge and a volumetric charge)
  3. meet the environmental/community benefit costs by a combination of District wide fixed charges per property, and a targeted rate based on capital value for all properties within the zone of benefit.

    • To provide an indication of the environmental/community benefit costs of the project, if Council were to recover this solely by a District-wide fixed charge, this would be approximately $45 per property per year.

For example:

  1. a Richmond urban rate payer would be charged the District wide rate, the zone of benefit rate and pay an increase in water charges.
  2. an unaffiliated Waimea irrigator would pay the District wide rate and the zone of benefit rate.
  3. an affiliated Waimea irrigator would pay the WIL irrigator charges, the District wide rate and the zone of benefit rate.
  4. ratepayers across the District, (approx. 23,000 rateable units), would pay a district wide fixed charge per property.

The physical boundaries for the “zone of benefit” are yet to be fully determined.  At this stage it is envisaged the ‘zone’ would include those properties on the Waimea Plains within the 2014 designated zone of effect, as well as properties whose water is supplied from the Waimea Plains and aquifer and urban areas including Richmond, Brightwater, and Mapua.

The consultation will also outline the proposed governance model for the Dam. The proposal is for the Dam to be operated as a Council-Controlled Organisation (CCO), with the Council holding the majority of shares (51%) to secure the public interest.

Tasman Mayor Richard Kempthorne said the consultation would give residents the full picture of how the project would affect them financially.

“I hope that a lot of the concerns people have about the cost of the project will be relieved by the funding model that has been developed. There are no planned large rate increases for either residents outside the Waimea area who draw less benefit from the scheme or for those within the zone. Those within the area of greatest benefit will pay a little more through their rates and water charges, but the payoff for them is a secure water supply with no need for summer restrictions except in the most severe droughts – a one-in-60 year event.

“Council is preparing a Statement of Proposal (SOP) which will be available to everyone in the district through the consultation and submission process.  Residents will be encouraged to send responses to Council for consideration. There’s still some details to be developed, but residents can expect to have all the numbers and impacts available for them to think about.  A final decision can be expected early 2018.”