A bit of budget mishandling happening
Yesterday the Auckland Council Finance and Performance Committee passed a set of resolutions to defer around $102 million worth of regional and Local Board ($72m for regional, $30m for Local Boards) projects. The same Committee also proposed to dispose (sell) Council owned land in Manukau which attracted my criticisms as well.
For more on the Manukau land sale, and the deferring of projects you can read the following posts:
Council Defers Local Board Projects
Council Votes to Sell off the Future of Southern Auckland [Updated]
Council Sells Land – Which It Should NOT in One Case
My displeasure was made sharply known in the following extract from my Council Votes to Sell off the Future of Southern Auckland [Updated] post:
Just earlier this afternoon the Committee apart from Manukau Councillor Arthur Anae agreed to sell the land off.
What an absolute shame in the fact it should have triggered the Significance Policy which would have triggered full public consultation on the issue. Especially as the Independent Maori Statutory Board were not happy with the poor consultation (if any) it got from Auckland Council Property Limited around the sale.
With that land now heading to the blocks thanks to a Council knee jerk reaction (of which I highly doubt the Otara-Papatoetoe Local Board will see any proceeds from the sale when the Local Board faces the biggest incoming budget cuts (being also discussed at the Committee today)(I wonder in the end if those proceeds instead of going to the Otara-Papatoetoe Local Board will go to the City Centre instead)) South Auckland just lost the perfect opportunity to engage in a full Public Private Partnership to develop the land – in a Metropolitan Centre – more to the point a City Centre while getting a healthy investment income from the subsequent leasing (as well as the standard rates) to future fund improvements in the Manukau City Centre and wider South Auckland area.
Pretty much the Councillors just sold our future (future investment income from contributions, rates and most of all leasing) off in the face of very large budget cuts coming up in the 2015-2025 Long Term. To make matters worse (and this really gets me going) is that Auckland needs all her existing park space she has as we intensify (Greenfield development gets new parks to serve it in most if not all cases) and for Manukau that is Hayman Park. Now we know Te Papa North will be built on Hayman Park effectively reducing the Park by up to half. Manukau City Centre loses half of its only large green park to a development (a good one though) that should be located on Council owned land (where Council can charge leasing fees) mixed in with other commercial and resident developments suited to a Metropolitan Centre. To make it more painful there is not any other decent green space to serve Manukau near by with the closest being the Botanical Gardens.
Short sightedness, knee jerk, 20th Century thinking to a 21st Century problem. AND Otara-Papatoetoe Local Board face big deferrals while losing a potential revenue stream from its Metropolitan Centre. I really feel for the residents and businesses of South Auckland after Council including the Deputy Mayor said the South needs a lot of loving and can not fail.
Well Council just did the absolute opposite in selling that land.
Stuff had also picked up on the deferrals and wrote:
Hefty regional cuts of $102m for Auckland
JAMES IRELAND Last updated 17:08 24/09/2014
Auckland councillors have voted to defer $102 million in capital funding.
The capital projects will be held back and re-evaluated in a year’s time as part of the Long-Term Plan budget.
Tensions mounted during the Finance and Performance Committee as Councillor Christine Fletcher asked to let local board chairs speak to defend themselves against the cuts.
Committee chairwoman Penny Webster put her foot down, saying the boards have had their chance to speak over the last month of workshop discussions.
The two went back and forward over the issue until Webster moved onto the next question.
Fletcher abstained from all votes on the item saying she disagreed with how Webster had chaired the meeting.
The biggest regional cuts for the city are $17.4m for the built heritage protection fund, $16.7m in land acquisitions and $10.1m in stormwater upgrades.
Councillor Linda Cooper questioned the future of the projects being deferred, saying there’s no guarantee they will be funded in a year.
“This isn’t as much a funding deferral as it is a discussion deferral. All we know is they will be discussed again in a year’s time. They may not pass then either.”
Deputy mayor Penny Hulse says the decision was a difficult one, but the money was a drop in the bucket compared to the council’s entire budget.
“We need to move on and look for new ways to get money into the machine. The local boards need to look at their budgets and figure out if they can find other ways to fund the projects they want.”
In the initial plan the city’s 21 local boards would have seen $35m of cuts, the boards came back with a counter plan, decreasing it to $21m.
Before I get onto some reaction from both Councillors and Local Boards over the deferrals I am going to point out two pieces which annoy me greatly as well as annoy the City to no ends of the Earth.
Councillor Linda Cooper questioned the future of the projects being deferred, saying there’s no guarantee they will be funded in a year. “This isn’t as much a funding deferral as it is a discussion deferral. All we know is they will be discussed again in a year’s time. They may not pass then either.”
I will get to that in a minute on what deferral is code for.
Deputy mayor Penny Hulse says the decision was a difficult one, but the money was a drop in the bucket compared to the council’s entire budget. “We need to move on and look for new ways to get money into the machine. The local boards need to look at their budgets and figure out if they can find other ways to fund the projects they want.”
That is beside the point Deputy Mayor Hulse. Those Local Board projects might be small in monetary terms but in the terms of social capital and social environmental output to the benefit of residents and business is often way more than just simple dollar signs. We are talking about amenities that contribute, build and anchor communities in such ways that negative social deprivation that Henderson is currently facing (as well as Manurewa-South Mall) being cut rather than larger projects like the Mill Road Corridor ($210 million), The East West Link ($1.1b) and the City Rail Link deferred to 2018 ($2.36 billion).
Simply put the Council is deferring the wrong things which will harm the City to larger extents compared to some larger multi million and billion dollar projects.
Back to Point One:
Some extracts from our elected representatives on the matter
A deferral is a governing body term for something they don’t want to fund this year, next year or potentially at all
So that echo’s Councillor Coopers thoughts. In short some projects may never make it back onto the Long Term Plan books…
[Of Local Boards having that direct voice, as I was writing this the Governing Body passed a resolution to allow Local Boards to directly oppose liquor licence applications. More in a future post.]
Effectively the Finance and Performance Committee have just gone an annoyed the wider City over what could be perceived penny-pinching on community projects while larger projects still sit there like sacred cows.
Not really good Governance from the Governing Body yesterday.
One thought on “Why I am Unhappy, and How to Annoy The City in One Go”
Ben, I keep getting blown away by how many of us there are out there, soldiering away against Council madness, without getting any traction. Proper investigative journalists, if the mainstream media had any, would be getting the kind of issues you raise well and truly into the public eye.
You are absolutely correct, there are multiple reasons why the Council should NOT be selling off land like this, and you are correct that actually utilising this land for development into one of many urban nodes, would be a far better way to go. The Council’s monocentric thinking is utopian and unworkable nonsense, there is a kind of urban-economic force of gravity that runs in the opposite direction, and cities always do better if they run with it, not against it. Monocentric, “CBD First” planning utterly stinks of corruption, with the CBD property owning vested interests standing to gain at everyone else’s expense, with massive dead-weight losses on top, also at everyone else’s expense.
I think we need some kind of investigation, problem is that few people are awake to these angles and don’t even realise when a bit of whistle-blowing is needed.
You are absolutely correct that an intensifying city needs all the more to retain “public space” somewhere. There is a paper from the 1990’s by a Prof. Ian Gordon (in the UK) that suggests that IF the necessary increases in public space and non-housing space (especially for employment) are taken into account, DOUBLING the density at which people LIVE only reduces a city’s urban footprint by 7%.
This is absolutely not worth it, because a mere 7% improvement in compactness will certainly be swamped by increased congestion delays, plus a “pricing out” and a spatial “sorting by income level” effect from the inevitable lifting of the urban land rent curve. This is why the UK ends up with VERY compact cities (for a given population level) and yet outlier-long average commute times.
Lastly, the Council is gouging developers in “development contributions”, part of which are for the “provision of public space”!!!!! If Councils were taking any notice of good planning principles, like those advocated by Alain Bertaud and by Shlomo Angel (and their various colleagues), they would be zoning well ahead and providing rights of way and public spaces while land is still greenfields and the opportunity cost is low. It is the Council’s own stupid FAULT if it is prohibitively expensive to acquire space for public use and roads and train sets and whatever (and prohibitively expensive even to access existing underground infrastructure for maintenance and renewal because the locations are so built out and disruption is massive).
Of course the Council just passes the costs of their own incompetence and bloody-mindedness on to the developers and hence on to every first home buyer, renter, business start-up and business expansion from now on and forever. It is not rocket science what this will do to a local economy!!!
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