The buyout policy framework

• Do I have to sell my property

• No

  The option to sell your property is voluntary - it's entirely your own decision.

  Council's not using the Public Works Act or any other mechanism to compulsory acquire Category 3 properties.

• How will the valuation of my property be calculated

• Council has commissioned independent registered valuers, Lewis and Wright Valuation and Consultancy Ltd to prepare a market valuation for each property. Property owners will be asked to supply them with any relevant information about their property to help establish the pre-cyclone value.

  The valuations date is 12 February 2023. For those properties damaged by the earlier North Island Severe Weather Events of 2023 the property will be valued as if the damage had not occurred.

• How will you calculate the valuation of my property

• Council is currently working on the buyout policy which will inform the valuation that is used.

• Where do demolition costs lie - with Council or the property owner

• Council will cover the costs of demolishing and making the site safe. If a property owner wants to keep a building and move it, then the costs for that will be theirs.

• If we can't agree on a buyout where does this leave us

• Selling your property to Council is voluntary. However, if you decide that you don't want to accept the Government's offer, you should be aware that:
  

  • If a consent for a new dwelling or major residential work is applied for, Council will process the application, but is required to take into account known information about the property’s exposure to natural hazard risk.
    This means applications for building consent and/or resource consent on Category 3 land are likely to face significant hurdles to be granted or may be declined
  • The Insurance Council has indicated that Insurers may cancel or refuse to renew insurance policies for properties in the Category 3 areas.

  Council encourages you to seek independent advice as to your future options for your property should you decide not to accept the offer.

• Is the buyout subject to the bright-line property rule

• Government has confirmed that the bright-line test will not be triggered when councils purchase damaged properties.

Insurance

• Should I spend my insurance pay out on repairs

• No. The insurance settlement you receive will be taken into account when Council is calculating a voluntary buyout offer for your property.

• Should I proceed with my insurance claim if my property hasn't been classified as FOSAL Category 3

• Yes.

  Advice from the NZ Insurance Council is to make sure you continue to progress your insurance claims.

  Any offer from Council will need to account for the insured value – that means any offer will consider the value of your property less any insurance received (or owed).

  This is a condition of the Government Support Package for residential property purchases, or relocation grants.

• Does my insurance settlement need to be completed before I can begin buyout negotiations with Council

• Yes. In all cases, you'll need to settle any claim with your insurer before Council can make an offer.
  
  

  Council will not “take over” any insurance claims.

  We strongly encourage you to seek the best settlement offer you can to reduce the financial impact from this buyout scheme on our wider community, and under Options 1B and 2B may increase your total payment.

  The NZ Claims Resolution Service is available to help you with your settlement.
  

• If I'm not satisfied with how my insurance claim is progressing, how can I get help

• The NZ Insurance Council has advised us that Category 3 properties are being prioritised.

  If you're not satisfied with the progress of your claim, contact your insurance company in the first instance and give them the chance to put things right.

  You can also contact the NZ Claims Resolution Service.

  There are 2 local representatives here in Tairāwhiti that you can meet in person with.

  Call 0508 624 327 or visit www.nzcrs.govt.nz.

• How do EQC payments work

• Toka Tū Ake EQC provides EQCover insurance to homes and some residential land from a range of natural hazards.

  You automatically have EQCover if you have a current private insurance policy for your home, that includes fire insurance - and most do.

  Claims for natural disaster damage are handled by your insurer, including the EQCover portion of the claim on behalf of Toka Tū Ake.

  Your insurer is the best point of contact for any questions you have about your claim.

• Is there a cap on EQC payments

• Yes.

  There is a cap on EQCover for both building and land damage.

  Your insurer will explain what cover is provided as part of your complete insurance payment(s).

  For more information on your EQCover entitlements see https://www.eqc.govt.nz/our-publications/household...

  
  

• I'm not happy with the offer from my insurance company, can I challenge this

• Yes, you can.

  Contact your insurance company to discuss their process for reviewing your claim. There's also free and independent dispute services.

  As part of your settlement with your insurance company, you should do your due diligence. For example, check that the offer from your insurance company adequately covers the damage to your property detailed in your scope of works. If you have quotes or evidence that it will cost more to do the repairs, then provide this evidence to your insurance company for their review.

  If you need advice on how to do this, contact your insurance company or the NZ Claims Resolution Service. Call 0508 624 327 or visit www.nzcrs.govt.nz.

• Do I need to provide my insurance company with a letter to prove my property has been classified as Category 3

• You no longer need to do this.

  Council regularly provides updated property classification lists to insurance companies.

• What happens if I've spent money fixing my property and then it became Category 3

• If you've already undertaken repairs using proceeds from your insurance, Council will not deduct these from the purchase price.

  However, you will need to provide evidence of those works that have been undertaken, such as receipts for all repairs or reinstatement to your dwelling to show these were undertaken in good faith.

About Category 3 assessments

• Who is assessing properties for their Category status and what are their qualifications

• A technical panel of Council staff with the required expertise who are being assisted by other experts as and when required.

  With such a range of qualifications, there’s too many to list but they range from over 20 years’ experience in their field to doctorates in the geotechnical area and engineering consultants.

• Who decides the Category status and what evidence was used

• The technical panel recommends the category status with the final sign off by Council’s Chief Executive.

  The panel used information and evidence from:
  

  • Site visits
  • Discussions with individual property owners
  • Technical assessments
  • Natural hazard overlay in the District Plan (TRMP)
  • Information from previous flooding events
  • Information on flood heights
  • Flood velocity and the extent of inundation
• Will the decisions and assessments be reviewed by a third party to ensure there's no bias

• Yes we’re doing that now and even if there‘s the slightest conflict of interest, we’ll use an independent third party to assess the property.

  LDE Engineering Consultants have carried out a number of reviews.

• Can I appeal a category status if I'm able to provide evidence or amend the assessment outcome

• If you think the categorisation for your property as provisional Category 3 is incorrect, you're welcome to provide evidence to support a request for change of category.

  Because the categorisation process has been carried out as a technical assessment based on the risk to life from future severe weather events, any evidence will need to be supplied by suitably qualified and experienced experts – such as Chartered Professional Engineers (CP Eng) with relevant expertise in fluvial geomorphology or geotechnical engineering, as relevant.

  Council will review any additional evidence you provide and where appropriate, obtain an independent peer review of the revised category recommendation from your expert, prior to the final determination by the Chief Executive. Council will then contact you directly to advise you of the outcome of this review process.

  Please note, you will be given 6 weeks from being notified of your property's provisional classification to request a review. We appreciate that it may take longer for technical assessments to be completed, this is not an issue provided you have notified us of your intention to request the review.

  If you have not requested a review by the timeframe, we will confirm your property’s classification as FOSAL Category 3 and progress with the voluntary buyout process.

  If you would like to move forward sooner than this, you can inform us in writing that you will not be seeking a review of the Categorisation.
  
• How will the Government ensure that Council assesses properties fairly and equally that compares to other regions, and doesn't select less severe categories because of Council's financial situation

• The Ministry for the Environment is working with the affected councils by having regular categorisation parameter discussions.

  The Department for the Prime Minister and Cabinet had engaged Tonkin & Taylor to carry out an assurance process across the 3 affected regions of the country.

• Is Council confident their process is as good and as well-resourced as other regions, and how do they know

• As above, and we also participate in weekly meetings with the other regions, Ministry for the Environment and Treasury to ensure consistency of process and application.

  Has Council asked the government for additional resources to get through this extraordinary amount of work?

  We did and we’ve had a number of secondments from various government agencies to assist our recovery office and these secondments are ongoing.
  

  
  

• Will the Government fund the whole voluntary residential property purchase scheme

• From the outset, the Government made it clear that it expected the purchase of residential property and residential property rights in Category 3 areas to be a cost-sharing exercise, which reflects the Government’s approach to the recovery being led by local councils and supported by central government.

  On 1 November Council accepted the Government's $204M support package of which $15M is for the buyout of Category 3 properties - this will be on a 50:50 cost share between Council and government based on the valuation of Category 3 properties as at 12 February 2023.

• How do you assess whether a property is a total loss

• This comes down to the damage sustained.

  If the figure to repair the property is more than the sum insured, it’s considered a total loss.