Rotoiti Lake Structure Update
March 4, 2021
LRCA Newsletter March 2021 Out
March 7, 2021
4 March 2021
East Rotoiti Sewerage Scheme Update March 2021
Prior to most recent Committee meeting on 1 March, an update was requested, (email here), from RLC, and a response was received, (email here).
RLC's concluding comments regarding the on-site sewerage system selection and funding are: “Please be assured that the process remains as you outlined. i.e. Conclude funding and contract matters, advice to the local communities, then report to Council with recommendations. We do hope that March/April would be the correct time frame".
Key additional points from the RLC response were:
* Tender evaluation process is challenging
* A number of market pressures and specific Rotoiti area factors are driving capital supply and installation costs higher than expected.
* Options assessment for funding has been undertaken.
* Application was made at February meeting of Rotorua Te Arawa Lakes Strategy group to the MfE, (Ministry for the Environment), for a deed funding contribution for the scheme to reflect market costs changes.
* Officers are working with MfE to determine options
* Overall objective is to pursue net Ratepayer costs as close as possible to those estimated back in 2017
* Unable to provide more detail or timeframes for outcomes.
* Intention is to clarify with MfE, then advise the Community, then submit a report and recommendations to Council, (hopefully in April), regarding entering into a construction contract and agreeing the capital and operational funding plan.
* Council is aware of the time that this is taking, are navigating some difficult matters, and cannot provide more information until resolved.
LRCA is grateful for this prompt reply, however it does not provide us with the background to the ‘specific Rotoiti area factors’ referred to above, nor the reasons for additional funding being necessary.
However examination of the agenda (p25 to p31) of the 12 February 2021 ROTORUA TE ARAWA LAKES STRATEGY meeting, (available here), provides more information.
In summary, section 8.3 p28 states:
“The forecasted variance by the Rotorua Lakes Council is driven by anticipated costs associated with reticulating Lake Rotoiti sewerage".
The cost drivers are varied but predominantly have been led by:
* Construction inflation,
* Higher costs to meet consent conditions not known in 2015,
* Improving access to the leased land at Haumingi 9B3B site,
* Provision of higher quality pretreatment systems to address cultural impacts,
* Additional security of installation for pretreatment systems on 180 sites where the systems must be installed below the water table
* And special legal processes to secure consents to install infrastructure on Maori land with multiple owners.
The pages 25 to 31 provide some other interesting information.
* There is an outline of the funding deed in the 2005 Treaty settlement for specific lakes (including Rotoiti) of $72m for improving lake water quality.
* There is an outline on how the remaining funding may further assist the Rotoma/East Rotoiti sewerage scheme
* There are 3 recommendations:
1. Revert to the pre 2014 allocation of deed funds between RLC and BoPRC. Transfer funds from the underspend on previous schemes (Mourea, Otaramarae, Whangamarino, and others around Rotorua to assist funding shortfall for Rotoma/Rotoiti.
2. Review Deed funding as no provision has been made for inflation since 2005.
3. Provide funding to include Rotoehu and Ngamotu settlement in Rotoma in the Rotoma/Rotoiti scheme, (it can cater for the additional load)
* The report highlights that RLC has not made decisions on how to fund increased project costs stated of $8,337,500, (that remains despite any Deed funding decisions). Options to be considered as part of its long term plan deliberations may include:
1. Staying within current plan requiring property owners to pay an increased net capital contribution compared to initial estimate
2. RLC could make contribution to Marae, sportsclubs, schools
3. Increase its financial assistance from current $1500 per property
4. Obtain debt funding for part of the increase
5. Or a combination of the above
Property owners will be unhappy if RLC adopts option 1, or a combination of options, that imposes increased costs per property.
If so, the community may consider lobbying RLC; BopRC; MfE on this matter through LRCA and directly.
Members are welcome to provide their views to LRCA at lrca@rotoiti.co.nz.