$204m Government cyclone support package
Between 2 - 16 October we asked for your feedback on whether we should accept or decline the Government's $204m support package offer. We received 223 submissions. Council at their meeting on 1 November accepted the offer. Read the full media release.
Background to community consultation
As a community we needed to decide how we pay for the cyclone recovery costs.
In June we began negotiations with the Government, and were facing a total repair cost of $1.1 billion - mainly made up of roading costs. We needed to secure the best support package from Government to help repair our infrastructure and enable communities to be safe and connected, while keeping impacts on rates as low as possible.
The Government offered a support package of $204m to Tairāwhiti for cyclone recovery.
The funding offer was conditional on Council contributing 50% of costs for Category 3 property purchases. The offer was also conditional on Council contributing 10% of costs for community risk mitigations, such as flood protection work.
Following a two week consultation (2-16 October) with the community we heard from you that the majority wanted Council to accept the Government package. We received 221 written submissions along with attendance and feedback from 12 engagements across the region with Councillors.
At its meeting on 1 November Council formally accepted the package and adopted the Category 3 Voluntary Buyout Policy.
What the $204M support package includes:
The Government's offer was presented as an all or nothing deal. This means Council had to accept and undertake the Category 3 buyouts to unlock significant funding for regional transport and flood resilience projects.
The offer will go a long way towards helping our region to recover and provide resilience in the future. We still need a lot more money but this is a significant amount.
Key consideration
Category 3 properties
By accepting the Government funding package we effectively agreed to purchase Category 3 properties. Areas in this high risk category are not safe to live in because of the unacceptable risk from future severe weather events and threats to life. Homes in these areas should not be rebuilt on their current sites because risks cannot be sufficiently mitigated.
Council has identified 51 properties as Category 3. This number may increase as further assessments are made.
Category 3 is the highest risk in the Government’s classification for areas affected by the North Island severe weather events. Areas in the high risk category are not safe to live in because of the unacceptable risk from future severe weather events and threats to life. Homes in these areas should not be rebuilt on their current sites because risks cannot be sufficiently mitigated.
Council has identified 47 properties as Category 3. This number may increase as further assessments are made.
The terms of the Government support package require Council to contribute 50% of the costs of purchasing properties or acquiring a property right for mixed use Category 3 properties. Mixed use land is where a house is located on land used for another purpose, for example farming or horticulture.
As this is not an approach we had anticipated taking before Cyclone Gabrielle, we’re consulting with you on the proposal along with a change to our Revenue and Financing policy.
Although the exact cost won’t be known until all the settlements are finalised, the estimated total cost is about $30m, with Council contribution estimated at $15m.
The terms of the offer allow Council to renegotiate with the Government if the costs for Category 3 property purchases are greater than estimated. Council cannot renegotiate the 50% share of costs.
The estimated $15m contribution by the Tairāwhiti ratepayers for the voluntary residential property purchases is a collective response to an event that has had overwhelming impacts and left some areas of the district devastated and no longer safe to live in.
How it will work
By accepting the Crown funding package the Council is effectively agreeing to purchase Category 3 properties. While the purchase costs are shared with the Government, Council will negotiate the process and eventually own the property.
For relocation grants, Council will not own the land but will own the residential rights for it.
The purchase details have not yet been confirmed but it’s intended that Council will make an offer to property owners with a residential dwelling on their Category 3 land.
Council is still developing the policy that will support the voluntary purchase of Category 3 properties. There is a wide range of circumstances that need to be considered before offers to property owners can be made, such as:
For whenua Māori, the Government has created a parallel Kaupapa Māori Pathway, where it’s responsible for the compensation for Māori land that’s no longer safe to live on. Council does not carry any costs for that process.
For more information on FOSAL Category 3 properties
Revenue and Financing Policy amendment
This enables Council to set up the new activity to facilitate Cyclone Gabrielle property transactions - purchasing Category 3 properties or a relocation grant.
This proposal makes provision for a new activity of Council to facilitate Cyclone Gabrielle property transactions. This will enable Council to establish a new activity to administer the process from initial offer to final settlement for FOSAL category 3 properties. The purchase may include purchase of the property or a relocation grant.
The Revenue and Financing Policy amendment includes incorporating the new activity ‘Cyclone Gabrielle Category 3 property and property right purchase’ for residential properties.
The activity is described as:
Cyclone Gabrielle Category 3 property and property right purchase – the Government has provided an assistance package to help our district recover from Cyclone Gabrielle. Part of the overall agreement involves Council making offers to purchase Category 3 properties or the residential rights of Category 3 properties which owners can voluntarily accept or decline.
This activity enables Council to administer the process from initial offer to final settlement.
As part of setting up a new activity of Council for Category 3 property and property right purchase, the Council is required to amend its Revenue and Financing Policy. This policy sets out how Council will fund each of its activities.
