Community Plan 2009-2019

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Section 8: Financial Implications and Forecast

Each local authority is required to produce forecast financial statements for each of the financial years covered by the Community Plan. The Community Plan explains the reasons why activities are engaged in, what activities are engaged in, the net cost of each activity and sources of funds to cover the estimated expenses, together with prospective financial statements. Its aim is to ensure that adequate planning is undertaken to meet infrastructural demands, whether arising from growth and development, or to maintain existing investment adequately.

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The nature of the prospective financial statements is to formulate a blueprint for the future in financial terms of the plan – it reflects both financial and strategic input. The Council’s prospective financial statements explain to the community the intended strategy for the next 10 years based on current information, policies, strategic direction and the assumptions on which it was prepared.

It is now best reflected in the rating requirement later in this section.

The current strategy was adopted concurrently with the 2009-2019 Community Plan.

There is a clear intention under the Local Government Act 2002 that the prospective financial statements will reflect the assumptions, objectives and anticipated outcomes set down in the other policies (Revenue and Financing Policy, Liability Management Policy, Investment Policy, Policy on Development Contributions or Financial Contributions, Policy on Partnerships between the Local Authority and the Private Sector, Policy on the Remission and Postponement of Rates on Maori Freehold Land, and rating policies) and with consistency between policy documents.

In practice, a significant portion of the content of the Community Plan (against which the Annual Report will measure the council’s performance) will be derived from the prospective financial statements, and a variety of other plans, significant reports and documents.

Prospective financial statements

The following pages present the financial plan (2009-2019) of the Council in detail in relation to each of the first three financial years and in outline in relation to each of the subsequent financial years covered by the plan. In particular, the following information is presented:

A summary of the practices and assumptions used in preparing the financial information.
The sources of income and where it is planned to be spent.
The effect of the planned income and expenditure on the overall net worth of the council.
What the Council owns and owes.
The prospective cash payments and receipts.
Additional supporting information.

The financial plan and prospective financial statements are based upon best-estimate assumptions and information available to New Plymouth District Council as at June 2009. While every care has been taken in the preparation of these statements, the actual results are likely to differ. These differences may be material.

This information has been prepared for the Council’s budgeting and financial planning purposes. It may therefore not be appropriate to be used for any other purpose.

This Plan, including the financial plan and prospective financial statements, was reviewed and updated in June 2009 for adoption as the final plan. The Council, however, reserves the right to update this plan in the future.

The prospective financial statements comply with the requirements of FRS-42 issued by the New Zealand Institute of Chartered Accountants.Return to top

Financial Overview

Section eight of this plan outlines the financial strategy for the Council. This should be read in conjunction with the financial policies in Volume 2. The prospective financial statements, based on the assumptions adopted and including inflation show:

Prospective Statement of Comprehensive Income

Annual net cost of operations is planned to increase by $45.5 million over 10 years. This can be explained as follows:

Planned asset additions totalling $121.9 million over 10 years and asset base revaluations are expected to generate an increase in annual depreciation of $12.8 million.
Additional new public debt totalling $79.8 million will be raised over the life of the Communtiy Plan for the purchase of new property, plant and equipment. This will result in the annual interest expense rising in total over the 10 years by $4.9 million.
Other operating costs including additional maintenance costs associated with new infrastructural assets together with inflation account for the balance of the increase in annual net cost of operations.

Annual rates revenue will increase by $41.6 million (72 per cent) over 10 years reflecting the increase in annual net cost of operations discussed above.

Prospective Statement of Financial Position

Cash and cash equivalents are expected to rise from $8.4 million in 2009/10 to $81 million in 2019/20 - $7.8 million will arise from the replenishment of depreciation reserves utilised to repay borrowings as planned in the 2006-2016 Community Plan and $5.0 million borrowed in earlier years from depreciation reserves. The majority of the cash and cash equivalents is made up largely of reserve funds, the largest of which is the depreciation reserves for the replacement of property, plant and equipment. The depreciation reserves show a steady increase from year three onward as a result of increased funded depreciation on new and revalued assets which must be replaced in the future.

Cash and borrowings have not been offset in the forecast financial statements. The Council will manage both its cash holdings and borrowings in accordance with the Liability Management Policy.Return to top

Investments are dominated by the Perpetual Investment Fund (PIF). By year 2018/19, $347.2 million of the total $352.8 million relates to PIF investment in a wide range of securities. In addition practically all of the $56.6 million increase in the value of investments over that period relates to PIF investments.

Growth in the PIF is the result of a deliberate council strategy to retain growth in accordance with the Investment Policy. The Council’s intention is to grow, in real terms, the capital of the PIF fund. This will ensure that the portion of annual revenue from the fund which is applied to Council operations ($21.5 million net in 2009/10) can also be maintained or improved in real terms. The alternatives to growing the fund are to use the capital to retire debt or to reduce rates over the short to medium term. However the Council sees these alternatives as offering short term gains only and prefers to work towards a longer term goal of reducing, in real terms, the dependency on general rates to fund the council’s operating activities.

The balance of investments ($5.6 million) do not vary much over the life of the Community Plan and represent shareholdings in trust funds and bequests and a loan to the New Plymouth Airport Joint Venture.

The value of property, plant and equipment is anticipated to rise over the 10 years by $566.5 million net. This arises from:

$121.8 million relates to new asset purchases, funded from a combination of asset sales, new debt, and government and other subsidies and grants.
$16.2 million relates to vested assets.
$521.1 million relates to asset revaluations.
$260.5 million relates to the increase in value of replacement assets over and above their book value.
$(4.2) million of asset sales.
$(348.9) million of depreciation.

Net external public debt, based on projected new asset purchases and projected debt repayments, is expected to rise by $31.9 million over the 10 year life of this Community Plan. All new public debt will be used to fund the purchase of new property, plant, and equipment. The council has a deliberate strategy of funding all net improvements from loans to achieve inter-generational equity. Treasury policy requires debt to be spread over a wide variety of terms in order to reduce interest re-pricing risks. Redemption loans are used to ensure that borrowings are generally spread over a 25-year term in order to ensure inter-generational equity. The result of this strategy is to increase loan servicing charges and therefore rates.

The provision for debt principal repayment is to be unfunded for wastewater and solid waste for the three years commencing 1 July 2009 due to the need to cover what would otherwise be signficant rate increases at a time when economic indicators are reflecting a recessionary economy. While this will have the net impact of maintaining higher levels of debt over the Community Plan period it will also enable rate levels to be spread more evenly over the 10 year period. This is a transitionary measure only to provide some level of relief to current ratepayers and its continuation will be reviewed on an annual basis. It is considered to be a sustainable measure as future forecast rate increases will offset the short-term impact over time.

The 2006-2016 Community Plan planned to utilise $7.8 million of depreciation reserves to repay borrowings and for the reserves to be replenished by 2014/15. This Community Plan continues that strategy with $2.0 million being utilised in 2009/10 and 2010/11 and repayments commencing in 2011/12.Return to top

Financial Assumptions

The budgets for future years may be changed by appropriate Council resolution.

This section outlines the key financial assumptions used in this document.

Levels of service

Unless otherwise stated in the activity sections, service levels are generally assumed to remain the same. Changes in service levels are shown in the individual activity sections as operating programmes and new capital programmes. Customer expectations regarding levels of service may change.

Level of uncertainty - Low.

Rating base

It is assumed that expansion of the rating base due to new subdivisions will be $0.15 million per year. This is based on past experience and anticipated population growth.

Level of uncertainty - Low.

Inflation

All amounts include, where applicable, inflation based on the Council’s own knowledge of its business base and on Business and Economic Research Limited (BERL) predictions (3 October 2008 release) for the 10 years in accordance with the table below. The rates used are midpoint average indices between years. BERL's March 2009 update indicated minimal change, particularly for the three years to 2011/12. The Council considered no change was required to the table below.

Level of uncertainty - Low.

	Balance Sheet assets				All costs and revenues
Year	Road	Property	Pipeline	Other	Energy	Staff	Other	Contractors	Professional services	First year
2008/09	2.82%	2.91%	3.51%	2.32%	4.01%	5.00%	2.32%	New categories for 2009/10
2009/10	4.10%	2.47%	6.22%	2.60%	10.00%	4.00%	2.60%	0.00%	2.60%	10.00%
2010/11	3.09%	2.90%	3.33%	3.33%	2.15%	2.59%	3.33%	3.33%	3.33%	3.33%
2011/12	2.91%	2.91%	2.96%	2.78%	2.47%	2.71%	2.78%	2.78%	2.78%	2.78%
2012/13	2.65%	2.73%	2.72%	2.36%	2.84%	2.64%	2.36%	2.36%	2.36%	2.36%
2013/14	2.32%	2.75%	2.96%	2.30%	3.01%	2.49%	2.30%	2.30%	2.30%	2.30%
2014/15	2.35%	2.85%	3.12%	2.08%	3.08%	2.51%	2.08%	2.08%	2.08%	2.08%
2015/16	2.22%	3.02%	3.19%	2.20%	3.23%	2.53%	2.20%	2.20%	2.20%	2.20%
2016/17	2.33%	2.78%	3.23%	2.32%	3.36%	2.89%	2.32%	2.32%	2.32%	2.32%
2017/18	2.43%	2.45%	3.21%	2.41%	3.32%	2.96%	2.41%	2.41%	2.41%	2.41%
2018/19	2.30%	2.25%	3.25%	2.44%	3.43%	2.88%	2.44%	2.44%	2.44%	2.44%
2019/20	2.24%	2.35%	3.35%	2.52%	3.52%	3.10%	2.52%	2.52%	2.52%	2.52%

Interest rates

Interest on cash investments and borrowing has been estimated at 3.00 per cent and 5.00 to 6.50 per cent respectively. Loan terms are assumed at 25 years unless otherwise indicated.

Level of uncertainty - Medium.Return to top

New Zealand Transport Agency subsidy rates

New Zealand Transporty Agency subsidy rates are assumed to continue at existing rates:

For operating expenditure 51% to 100%

For improvements 61% to 100%

Level of uncertainty - Low.

Development Contributions and Borrowing

Given the current economic uncertainties the funding anticipated through the development contributions has not been budgeted for in the Financial Plan and has been covered by additional borrowing as the relevant expenditure occurs. As development contributions are actually received they will be netted off any borrowing made for that purpose.

Level of uncertainty - Medium.

Council’s key financial strategies

The Council’s key financial strategies are based on affordability of service improvements, sustainable borrowing and rate increases over the term of the Community Plan. Apart from unfunded depreciation, operating costs are to be met from operating revenues and rates.

The Council maintains funding for the replacement of significant assets from operating revenues and rates. Refer to the Council’s Revenue and Financing Policy in Volume 2 of this Plan.

Cash and borrowings have not been offset in the forecast financial statements. The Council will manage cash and borrowings in accordance with the Liability Management Policy and forecast requirements.

The Council is not funding loan principal repayments on sewerage and solid waste loans for the three years from 2009/10. Principal repayments will recommence in 2012/13 at a higher level to maintain the 25 year loan terms.

Apart from the loan principal deferral noted above, the Community Plan has been prepared on a basis consistent with current key financial strategies.

Level of uncertainty - Low.

Rates remissions

The Council allows for rates remissions in terms of the Council’s rate remission policy in Volume 2 of this Plan. Remissions have been estimated at $1.1 to $1.4 million.

Level of uncertainty - Low.

Asset sales

Other than for some surplus properties and the New Plymouth waste transfer station, no major or surplus asset sales have been allowed for in the plan, but the Council will keep this option under continual review.

Level of uncertainty - Low.Return to top

Investments

The Council is able to sell or convert any of its investments in accordance with its Investment Policy. Listed equity and security investments are re-valued at the conclusion of each financial year using fair value based on the NZDX values.

Foreign currencies vary in value, over time, against the NZ$ and the variations impact on the value of the investments concerned and their returns. Foreign currency exposure will be monitored by Taranaki Investment Management Limited (TIML) in line with its investment policies for the Perpetual Investment Fund (PIF).

The investment fund is expected to earn 9.5 per cent per annum on average over the 10 years. The Council and TIML have agreed on a sustainable release rule that results in a release for 2009/10 of $21.5 million plus attributed costs funded from the investment fund. Thereafter the release has been estimated at $21.5 million plus costs.

Level of uncertainty - Medium.

Perpetual Investment Fund

The release rule for the PIF is a formula that determines the annual release to be made from the PIF ahead of the year it will apply to. It has two components:

Eighty per cent of the previous year’s release, inflation adjusted for the year prior to that to be budgeted for; plus
Twenty per cent of a 5.6 per cent portion of the year-end audited capital value of the PIF, inflation adjusted for the year prior to that to be budgeted for.

The 5.6 per cent is a long-term release target that strikes a balance between the sustainability of the annual release and the real capital value of the PIF.

The release rule smoothes the potential annual fluctuations that would otherwise occur if a straight percentage of annual value was used. As such it provides greater certainty for the Council on annual release levels for budgeting purposes.

Level of uncertainty - Medium.

Revaluation of non-current assets

Non-current assets are periodically revalued (refer to the Statement of Accounting Policies). Potential revaluation impacts based on the predictions for inflation are incorporated in the forecasts for certain property, plant and equipment (PPE) for the years ended 30 June 2011, 2014 and 2017.

It is assumed that significant PPE assets will achieve the useful lives outlined in the Statement of Accounting Policies.

Level of uncertainty - Low.Return to top

Depreciation on asset acquisitions

The depreciation rate used for asset acquisitions is based on the asset class into which the asset falls in accordance with asset management plans. The actual rate of depreciation applied to acquisitions will differ if assets are reclassified.

Level of uncertainty - Low.

Adoption of Council policies

Council policies may change at any time during the period covered by the prospective financial statements. The prospective financial statements are based on existing policies.

Level of uncertainty - Low.

Capital structure

The Council’s capital structure will not change significantly over the period of the Community Plan except for an increase in public debt commensurate with the acquisition of PPE assets. There is no intention on the part of Council to realise investments to repay public debt.

Level of uncertainty - Low.

Significant contingencies/commitments

The Council has been successful with a bid to be part of the Rugby World Cup tournament in 2011 with a goal that the net cost currently estimated at $1.75m is minimised by funding from external sources. The bid commits the Council and the Yarrow Stadium Trust to undertaking certain facility upgrades/alterations sufficient to meet minimum standards necessary to host the games applied for, as well as other elements associated with the tournament itself. The net cost has not been budgeted for in the Community Plan given the external fundraising that now needs to be secured.

Fundraising is expected to continue through 2009/10. It is anticipated that any actual budget impact for the Council, if any, will be met from short term loans if required and then the full financial position clarified in time for the 2010/11 budget year.

Level of uncertainty - Low.

The Council has undertaked an investment and management review of its camping grounds. Key issues considered included increased investment by the Council and operators, and potential redevelopment and/or closure of some camp grounds. The impacts of this review have been included in the final Community Plan.

Level of uncertainty - Medium.Return to top

An Emissions Trading Scheme (ETS) was passed into law by Parliament on 26 September 2008. The ETS creates obligations to limit greenhouse gas emissions for a wide range of activities in NZ, including, some activities undertaken by local government.

Following the general elections in November 2008, the new government commenced a review of the ETS, which it intends to complete by the end of 2009. As the outcome of the review will occur after this Community Plan is finalised, the detail of how the reviewed ETS may impact on this Community Plan is unknown.

However, it is anticipated there will be an ETS (or a carbon tax) in some form in the near term, possibly effective as early as 2010/11. An ETS is likely to have financial implications for future Council budgets.

BERL has indicated a one-off uplift in inflation (see earlier) in 2010/11 of 1.1 per cent. This has not been included in the Council's forecasts at this stage because of the level of uncertainty. However, the Council has included an estimated impact for solid waste of $0.5 to $1.0 million per annum from 2013/14.

Level of uncertainty - Medium.

The Taranaki Arts Festival Trust (TAFT) requested, by submission to the community plan process, for up to a $200,000 total underwrite for WOMAD, the Taranaki International Festival of the Arts and the Taranaki Rhododendron and Garden Festival.

The council approved the request in principle for year one of the 2009-2019 Community Plan as a one-off decision, subject to further analysis and justification, including a review of the detailed accounts for these events, so that the financial and business risks and the appropriate level of underwrite for each individual event can be fairly assessed. Officers were also instructed to include the development of a policy on the underwriting of major events as part of the current review of the district events strategy.

The potential financial impact is included as a contingent liability, although it is unclear at this stage what the policy may require in total.

Level of uncertainty - Medium.

The Council resolved on 30 March 2004 to offer the ‘Waitara Leasehold Land’ (as defined in the resolution) to the Crown, subject to certain conditions. Some of those conditions are that:

The Waitara Leasehold Land be included in the Crown’s offer to settle historical Treaty claims;
The Council receive a fair market value for the Waitara Leasehold Land;
Settlement legislation be passed freeing the Waitara Leasehold Land from its statutory trusts and restrictions, and
The sale not take place until such legislation had passed.

Since the decision the council has been involved in protracted litigation which has been unsuccessful in seeking to overturn the decision. Some leaseholders are currently appealing a High Court decision striking out their claims for damages. Pending the outcome of that appeal, the Council intends to progress implementation of the 2004 resolution. This means that the Chief Executive is authorised to negotiate terms of any sale with the Crown, subject to approval by the council. Any sale will be subject to compliance with any statutory requirements, with proceeds applied to the purposes authorised by statute.

Level of uncertainity - Medium.

The Council intends to sell its fee simple interest in any part of the Junction Rd endowment land, subject to:

Compliance with any statutory requirements (and in particular, but not limited to, section 141 of the Local Government Act 2002 and section 40 of the Public Works Act 1981).
Compliance with the Council’s Approval of Properties for Sale Policy (P05-019), where appllicable.
Agreement being reached on terms acceptable to the Council’s Chief Executive (including an acceptable purchase price).Return to top

The proceeds of any sale of any part of the Junction Rd endowment land will be used by the Council for the purposes specified in section 4 of the Taranaki County Reserves Act 1966.

Level of uncertainty - Medium

The Council has raised loan finance during 2008/09 of $4 million for the New Plymouth Airport Joint Venture for the purposes of runway refurbishment. This loan will be repaid from operating cashflows from the New Plymouth Airport Joint Venture.

Level of uncertainty - Low.

Although insurance cover is arranged where appropriate and possible, to mitigate the potential costs of major adverse events, the Council has arranged credit lines with its bankers and is a member of the Local Authorities Protection Plan (LAPP).

Level of uncertainty - Low.

The Council is not aware of any other additional contingencies or commitments not already covered by the prospective financial statements and/or asset management plans.

Risks

The following are the key risks underlying the forecast financial statements:

Interest rates, credit exposure and renewability of external borrowings. The Council manages these risks in accordance with the Liability Management Policy and maintains an annually reviewed rating from Standard and Poors. The level of uncertainty is considered to be low.
Unforeseen event causing major budget disruption and/or impact on borrowing requirements. The Council has certain strategies in place to manage these risks (insurance cover, credit lines etc). The level of uncertainty is considered to be low.
PPE assets do not achieve their economic lives. The Council has, and continues to develop, appropriate asset management plans together with regular inspection and other management practices to manage these risks. The level of uncertainty is considered to be low.
Investment income and values. The Council manages these risks in accordance with the Investment Policy. The PIF and the ‘release rule’ are governed under contract with TIML. The Council will respond appropriately at the time. The level of uncertainty is considered to be medium.
Additional import of responsibilities from central government. This may occur through changing legislation or service delivery. The level of uncertainty is considered to be medium.
Population factors. These may impact the significant activities through growth, lifestyles and population movement. The level of uncertainty is considered to be medium.
Technology risks/opportunities. These have the potential to influence the useful life of assets. However as most of the value of the Council’s PPE assets is in infrastructural assets the level of uncertainty is considered to be low.Return to top

Balancing the Budget

The Local Government Act 2002 requires that where the Council has resolved, under Section 100(2), not to balance its operating budget in any year covered by the plan, the Council must include a statement of the reasons for the resolution and any other matters taken into account and the implications of the decision. Over the 2009-2019 Community Plan period the budgets have been balanced, but depreciation is not fully funded on the following assets. Details are:

Depreciation on long-life assets

The fundamental purpose of accounting for depreciation is to reflect the cost of use of fixed assets in each financial year, measured by the amount of economic benefit consumed. Historically, depreciation has been used as a means by which funding is provided for the replacement of depreciating assets and, where fiscally possible, the repayment of intergenerational debt.

Depreciation charges do not always provide a reasonable model for funding asset renewal. This is particularly relevant to assets which have long useful lives and are intergenerational in nature. Infrastructure assets with long lives (greater than 50 years and up to 200 years lifespan) make up 70 to 95 per cent of total asset replacement cost values across the range of council activities. A ‘whole-of-life’ (or life-cycle) approach to asset appraisal, intergenerational benefit and funding perspectives has been adopted to support fiscal policy and enable the achievement of sustainable asset investments. Infrastructure assets with useful economic lives of greater than 50 years, have been considered for delayed cash funding (i.e. unfunded depreciation in earlier years) in order to better match the funding of renewal to the beneficiaries of the renewal. Delayed cash funding has been adopted for those long life assets that are up to and no more than 20 per cent through their life-cycle. Risks associated with this approach are considered to be low due to a combination of mitigations, namely:
- A small but positive net cash position has been adopted and maintained to ensure that sufficient resources are available for renewals over the plan period.
- No significant ‘humps’ of renewal expenditure are projected over the next 20 years.
- The furtherance of asset inspection and ongoing maintenance programmes will enable the update and review of asset life-cycle perspectives, which in turn will help to improve and support management strategies and practices associated with planning for renewals.
While it is accepted that such forecasts have a degree of uncertainty, assumptions and analysis are based upon the best information currently available to the Council. As ongoing monitoring and asset assessments progress, it is expected that the Council will improve its practice further moving forward.

Depreciation on roading assets is further unfunded by $4.0 to $6.3 million per annum. This unfunded amount is the estimated financial assistance that is expected to be received from New Zealand Transport Agency as contribution towards renewal of assets when those assets are renewed.
Depreciation on Puke Ariki fitout is unfunded by $0.8 to $0.9 million. These assets were funded by external parties and it is anticipated a significant contribution will continue to be provided from external parties for funding replacement.

The level of unfunded/deferred depreciation is shown in the financial statements of each affected Council activity.

The Council is also proposing to utilise funded depreciation reserves amounting to $2.0 million to repay loans during 2009/10 and 2010/11. The 2006-2016 Community Plan allowed for this and it is phased out by 2010/11 with depreciation reserves then being replenished over the next four years.Return to top

Prospective Financial Statements

Prospective Financial Plan (based on the 2009/10 budgets)

Prospective Statement of Comprehensive Income

Prospective Statement of Changes in Equity

Prospective Statement of Financial Position

Prospective Statement of Cashflow

Note. The Opening Balance has been adjusted to reflect the opening position at 1 July 2008.Return to top

Statement of Accounting Policies

Reporting entity

New Plymouth District Council is a territorial local authority governed by the Local Government Act 2002.
The primary objective of New Plymouth District Council is to provide goods or services for the community or social benefit rather than making a financial return.
For the purposes of the 2009-2019 Community Plan, the prospective financial statements (financial statements) cover all the activities of the council as a separate entity. A consolidation including the council’s beneficial interest in its council-controlled organisations, joint ventures and associated entities is not provided. The financial statements have been prepared in accordance with the requirements of the Local Government Act 2002 and New Zealand Generally Accepted Accounting Practise (NZ GAAP). New Plymouth District Council (the Council) has applied NZ IFRS. The Council is a public benefit entity (PBE) and has applied the PBE exemptions available under NZ IFRS.
The prospective financial statements include Activity Cost of Service Statements, Financial Plan, Comprehensive Income Statement, Statement of Movement in Equity, Balance Sheet and Cashflow Statement.
The prospective financial statements of New Plymouth District Council are for the year ending 30 June 2010 and the subsequent nine financial years.
The accounting policies set out below have been applied consistently to all periods presented in these prospective financial statements.
There are no standards, interpretations and amendments that have been issued, but are not yet effective, that the Council has not yet applied.

Measurement base

The prospective financial statements have been prepared on a historical cost basis, modified by revaluation of certain assets and liabilities. The prospective financial statements are presented in New Zealand dollars and all values are rounded to the nearest million dollars. The functional currency of the Council is in New Zealand dollars.

Accounting policies

The following accounting policies which materially affect the measurement of results and financial position have been applied.

Goods and Services Tax
The prospective financial statements have been prepared exclusive of Goods and Services Tax, with the exception of receivables and payables which are stated inclusive of the Goods and Services Tax in the Prospective Balance Sheet.
Allocation of overheads
All overhead expenses have been allocated to significant activities. A variety of methods have been used appropriate to the overhead concerned. Examples include space utilised, staff numbers, transaction numbers, estimate of time and expenditure and funds required from rates.
Operating lease payments
Operating lease payments, where the lessors effectively retain substantially all the risk and benefits of ownership of the leased item, have been charged as expenses in the periods in which they are incurred. Return to top
Revenue
- Revenue is measured at the fair value of consideration received.
- General revenue is recognised at the time of invoicing, performance of service or receipt of application of service or licence and by reference to the stage of completion of the transaction at balance date, based on the actual service provided as a percentage of the total services to be provided.
- Rating income is recognised when assessments are issued or penalties incurred.
- Levies are recognised when assessments are issued.
- Government grants are recognised when eligibility has been established by the granting agency.
- Interest earned is recognised on an accrual basis.
- Dividends are recognised when received or accrued if the record date is 30 June or prior.
- Vested assets are recognised at fair value on the vesting of the assets.
- Financial contributions (other than those in the Policy on Development Contributions) are recognised when the service is provided.
- Water billing revenue is recognised on an accrual basis. Unbilled sales, as a result of unread meters at year end, are accrued on an average usage basis.
- New Zealand Transport Agency roading subsidies are recognised as revenue upon entitlement, which is when conditions pertaining to eligible expenditure have been fulfilled.
Financial assets
New Plymouth District Council (NPDC) classifies its financial assets into the following two categories:
- Financial assets at fair value through profit or loss; and
- Held-to-maturity investments.
The classification depends on the purpose for which the investments were acquired. Management determines the classification of its investments at initial recognition and re-evaluates this designation at every reporting date.
The two categories of financial assets are:
- Financial assets at fair value through profit or loss
A financial asset is classified in this category if acquired principally for the purpose of inclusion in the NPDC’s Perpetual Investment Fund or if so designated by management. Assets in this category are classified as non current assets as there is no plan to dispose of them within 12 months of balance sheet date unless market conditions make it profitable, or prudent, to do so.
After initial recognition they are measured at their fair values. Gains or losses on remeasurement are recognised in the Statement of Financial Performance.
Financial assets in this category include quoted shares, bonds, private equity funds and share options.
- Held to maturity investments
Held to maturity investments are assets with fixed or determinable payments and fixed maturities that NPDC has the positive intention and ability to hold to maturity.
After initial recognition they are measured at historic cost. Gains and losses when the asset is impaired or de-recognised are recognised in the income statement.
Investments in this category include local authority stock and interest bearing bonds. Return to top
Impairment of financial assets
At each balance date NPDC assesses whether there is any objective evidence that a financial asset or group of financial assets is impaired. Any impairment losses are recognised in the Income Statement.
Financial instruments
Revenue and expenditure in relation to all financial instruments are recognised in the Income Statement. All financial instruments are recognised in the Balance Sheet. The Council and its subsidiaries are risk averse and seek to minimise exposure arising from its Treasury activity. Except for those items covered by a separate accounting policy, all financial instruments are shown at their fair value.
Inventory
Inventories are valued on the basis of the lower of cost, determined on a weighted average cost basis, and current replacement cost. This valuation includes allowances for slow moving and obsolete inventories.
Trade and other receivables
Accounts receivable are valued at expected fair value. All known bad debts have been written off during the period under review. As there are statutory remedies to recover unpaid rates, penalties and water meter charges, no provision has been made for impairment in respect of rates receivables.
Properties intended for sale
Properties no longer required in the council’s operations and therefore intended for sale, have been valued at the lower of carrying amount and fair value less selling costs. These are tested for impairment on an annual basis.
Property, Plant and Equipment (PPE)
Property, Plant and Equipment are included at their valuation as at 30 June 2008 with subsequent additions recorded at cost. All PPE were valued by council staff except where specifically identified. Independent reviews were carried out as at 30 June 2008, to confirm that the methodology used is in accordance with NZ IAS 16, and conforms to accepted valuation methods.
All PPE (other than operational plant, vehicles, work-in-progress, furniture and fittings which are not re-valued) are re-valued at fair value by reference to their depreciated replacement cost or market value on a class basis at least every three years. The carrying value of revalued assets are reviewed at each balance date to ensure that these are not materially different to fair value. Any surplus arising on revaluation is credited to a revaluation reserve for that class. Any deficit is charged against the revaluation reserve, or if not available, expensed in the Income Statement.
- Infrastructural assets are fixed utility systems providing continuing service to the community, e.g. roads, water or sewerage systems. The infrastructural assets are valued at depreciated replacement cost as at 30 June 2008 and will be revalued on the same basis three yearly thereafter. Additions in the intervening years are included at cost.
Independent valuations were carried out as follows:
John Freeman, FPINZ, TechRICS, MACostE, Registered Plant and Machinery Valuer CB Richard Ellis Ltd
: Water treatment plants
: Water reservoirs
: Water pumping stations
: Wastewater treatment plants
: Wastewater pump stations
: Roading network
: Reticulation network
OCEL
: Coastal structures
: Stormwater diversion tunnel
: Stormwater detention dams
Roads include derived values for land not held on title (road reserve). The average value of the road reserve is the current average land value calculated for each government roll number. The following factors have been applied:
Unformed roads 50% of average value
Formed roads (urban) 80% of average value
Formed roads (rural) 60% of average value
- Operational assets are tangible assets that are used as part of the normal operations of the council.
- Plant, vehicles, furniture and fittings were re-valued as at 30 June 1999 at fair value. The council has, in terms of NZ IAS 16, ceased to revalue these assets for cost-benefit reasons. Additions to these assets since 30 June 1999 are disclosed at depreciated cost.
- Land and uncomponentised buildings have been valued at fair value as at 30 June 2008 by Ian Baker FNZIV, FPINZ, Registered Valuer, Telfer Young Ltd and will be revalued on the same basis three yearly thereafter by a registered valuer.
- Restricted assets are assets which cannot be disposed of due to legal or other restrictions, and that provide a benefit or service to the community.
- The Puke Ariki museum collection and the Govett-Brewster Art Gallery collection have been valued at fair value as at 30 June 2008 by Dr Robin Watt MA (Hons) Ph.D, R J Watt and Associates (Puke Ariki) and Sophie Coupland, Emma Fox, Jessica Pearless, Erika Chamberlain, Peter Webb Galleries Limited (Govett-Brewster Art Gallery) and will be valued by suitably qualified experts on a three yearly basis thereafter.
- The Puke Ariki book collection has been valued as at 30 June 2008 by Dr Robin Watt MA (Hons) Ph.D, R J Watt and Associates and will be valued by a suitable expert on a three yearly basis thereafter. The heritage book collection has been valued at replacement cost and the general in use collection has been valued at depreciated replacement cost.
- Restricted land has been valued at fair value as at 30 June 2008 by Ian Baker FNZIV, FPINZ, Registered Valuer, Telfer Young Ltd and will be valued on the same basis three yearly thereafter by a registered valuer. Return to top
- Work in progress has been valued at lower of net realisable value or cost.
Additions
The cost of an item of property, plant and equipment is recognised as an asset if, and only if, it is probable that future economic benefits or service potential associated with the item will flow to New Plymouth District Council and the cost of the item can be measured reliably.
In most instances, an item of property, plant and equipment is recognised at its cost. Where an asset is acquired at no cost, or for a nominal cost, it is recognised at fair value as at the date of acquisition.
Disposals
Gains and losses on disposal are determined by comparing the proceeds with the carrying amount of the asset. Gains and losses on disposals are included in the Income Statement. When revalued assets are sold, the amounts included in asset revaluation reserves in respect of those assets are transferred to retained earnings.
Subsequent costs
Costs incurred subsequent to initial acquisition are capitalised only when it is probable that future economic benefits or service potential associated with the item will flow to New Plymouth District Council and the cost of the item can be measured reliably.
Depreciation
- Operational assets are depreciated on a straight line basis on the following rates:
Buildings 1% or 2.5% 40 to 100 years
Plant and vehicles 5% to 33% 3 to 20 years
Furniture, fittings and equipment 10% to 33% 3 to 10 years
The Puke Ariki library heritage collection is not depreciated as it is council policy to maintain the collection in its current state. The general in use collection is depreciated on a straight line basis over 2-15 years.
The museum/art gallery collections are heritage assets and are not depreciated as it is Council policy to maintain the collections in its current state.
Land is not depreciated.
- Infrastructural assets are depreciated on a straight-line basis. The useful lives are as follows:
(years)
Roads
: Top surface 5-25
: Basecourse and first coat seals 15-80
: Water channel 40-80
: Culverts 40-80
: Footpaths/crossings 10-100
: Kerbs 40-80
: Signs 5-10
: Traffic signals 10-30
: Streetlights 30-40
: Road structures 40-100
Water
: Pipes 50-120
: Pump stations 30-80
: Reservoirs 30-100
: Treatment plants - civil 30-100
: Treatment plants - mechanical 10-40
Sewerage
: Pipes 50-140
: Manholes 60-80
: Treatment plants - civil 30-100
: Treatment plants - mechanical 10-40
: Pumping stations - civil 30-80
: Pumping stations - mechanical 10-40
: Outfalls 60-100
Stormwater Systems
: Pipes 50-140
: Manholes 60-80
(years)
Flood Control Systems
: Dams 100-200
: Tunnels 100-200
: Channels 50-100
Landfill and Transfer Stations
: Operating landfill sites 10-20
: Closed landfill sites 25-50
: Transfer stations 50-75
Foreshore Protection 30-100 Return to top
Intangible assets
Any research or development costs are expensed.
Computer systems where capitalised are amortised over their useful lives, generally between three to eight years on a straight line basis.
Easements are recognised at cost. They are regarded as having an indefinite useful life and are not amortised but tested annually for impairment.
Biological assets
Forestry is valued annually by an external forestry consultant, Theo Vos, PF Olsen Ltd at fair value less estimated point of sale costs in accordance with NZ IAS 41. Fair value is determined by reference to market value, primarily determined by export prices. Any gains or losses on revaluation, including impairment, are taken direct to the Income Statement.
Harvested logs are treated as revenue when invoiced at contracted prices. The portion of asset value harvested is charged as a cost of sale in the Balance Sheet.
Impairment of Property, Plant and Equipment and intangibles
The carrying values of all classes of PPE are reviewed annually for impairment by reference to internal and external factors which may indicate the carrying value exceeds depreciated replacement cost. Any significant impairment is recognised by writing the assets down to their depreciated replacement cost and charging the impairment to the relevant revaluation reserve or Income Statement where there is no relevant revaluation reserve.
Accounting for revaluations
New Plymouth District Council accounts for revaluations of property, plant and equipment on a class of asset basis.
The results of revaluing are credited or debited to an asset revaluation reserve for that class of asset. Where this results in a debit balance in the asset revaluation reserve, this balance is expensed in the Income Statement. Any subsequent increase on revaluation that off-sets a previous decrease in value recognised in the Income Statement will be recognised first in the Income Statement up to the amount previously expensed, and then credited to the revaluation reserve for that class of asset.
Income tax
Income tax expense in relation to the surplus or deficit for the period comprises current tax and deferred tax.
Current tax is the amount of income tax payable based on the taxable profit for the current year, plus any adjustments to income tax payable in respect of prior years. Current tax is calculated using rates that have been enacted or substantively enacted by balance date.
Deferred tax is the amount of income tax payable or recoverable in future periods in respect of temporary differences and unused tax losses. Temporary differences are difference between the carrying amount of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit.
Deferred tax liabilities are generally recognised for all temporary differences. Deferred tax assets are recognised to the extent that it is probable that taxable profits will be available against which the deductible temporary differences or tax losses can be utilised.
Deferred tax is not recognised if the temporary differences arise from the initial recognition of goodwill or from the initial recognition of an asset and liability in a transaction that is not a business combination, and at the time of the transaction, affects neither accounting profit nor taxable profit.
Deferred tax is recognised on taxable temporary differences arising on investments in subsidiaries and associates, and interests in joint ventures except where the joint venture can control the reversal of the temporary difference and it is probable that the temporary difference will not reverse in the foreseeable future.
Deferred tax is calculated as the tax rates that are expected to apply in the period when the liability is settled or the asset is realised, using tax rates that have been enacted or substantively enacted by balance date.
Current and deferred tax is charged or credited to the Income Statement, except when it relates to items charged or credited directly to equity, in which case the tax is dealt with in equity.
Trade and other payables
Loans are valued at fair value with annual adjustments through the Income Statement. Payables are valued at fair value. Return to top
Employee benefits
Provision is made in respect of the council’s liability for annual leave which has been calculated on an actual entitlement basis at current rates of pay. Long service leave and retirement gratuities have been calculated on present value at current rates of pay. Accumulated sick leave carried forward, which is anticipated to be taken in future periods, is not considered material for inclusion.
Borrowing costs
Borrowing costs are recognised as an expense in the period in which they are incurred.
Landfill post-closure provision
The landfill post-closure provision is measured based on the best estimate at a discount rate in accordance with financial reporting standard NZ IAS 37 Provisions, Contingent Liabilities and Contingent Assets.
The on-going annual charge to the income statement arising from the landfill will now comprise depreciation of the landfill asset, and amortisation of the post-closure liability.
Equity
Equity is the community’s interest measured as the difference between total assets and total liabilities. Public equity is disaggregated and classified into a number of components to enable clearer identification of the specified uses that the council makes of its accumulated surpluses:
- Restricted reserves:
: Trust and bequests.
: Special funds.
- Council-created reserves.
- Asset revaluation reserves.
- Retained Earnings.
Reserves
Reserves are a component of equity generally representing a particular use to which various parts of equity have been assigned. Reserves may be legally restricted or created by the council.
Restricted reserves are those reserves subject to specific conditions accepted as binding by the Council and which may not be revised by the Council without reference to the courts or third party. Transfers from these reserves may be made only for certain specified purposes or when certain specified conditions are met.
Council-created reserves are reserves established by council decision. The Council may alter them without reference to any third party or the courts. Transfers to and from these reserves are at the discretion of the Council.
Cash and cash equivalents
Cash and cash equivalents means cash balances on hand, held in bank accounts, demand deposits and other highly liquid investments with maturities of three months and less in which the council invests as part of its day-to-day cash management.
Development contributions
The revenue recognition point for development and financial contributions is at the later of the point where New Plymouth District Council is ready to provide the service for which the contribution was levied, or the event that will give rise to a requirement for a development or financial contribution under the legislation.
Budget figures
The budget figures are those approved by the Council when adopting the 2009-2019 Community Plan. The budget figures have been prepared in accordance with NZ GAAP, using accounting policies that are consistent with those adopted by New Plymouth District Council for the preparation of the prospective financial statements.
Superannuation schemes
Defined contribution schemes – Obligations for contributions to defined contribution superannuation schemes are recognised as an expense in the statement of financial performance as incurred.
Defined benefit schemes – New Plymouth District Council belongs to the Defined Benefit Plan Contributors Scheme, which is managed by the Board of Trustees of the National Provident Fund. The scheme is a multi-employer defined benefit scheme. Insufficient information is available to use defined benefit accounting, as it is not possible to determine from the terms of the scheme, the extent to which the surplus/deficit will affect future contributions by individual employers, as there is no prescribed basis for allocation. The scheme is therefore accounted for as a defined contribution scheme. Return to top
Basis of consolidation
New Plymouth District Council’s investment in its subsidiaries are carried at cost in the New Plymouth District Council’s own “District” financial statements.
Critical accounting estimates and assumptions
In preparing these financial statements New Plymouth District Council has made estimates and assumptions concerning the future. These estimates and assumptions may differ from the subsequent actual results. Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations or future events that are believed to be reasonable under the circumstances.
Landfill aftercare provision – The Annual Report 2007/08 Note 19 discloses an analysis of the exposure of New Plymouth District Council in relation to the estimates and uncertainties surrounding the landfill aftercare provision.
Infrastructural Assets – There are a number of assumptions and estimates used when performing DRC valuations over infrastructural assets. These include:
- The physical deterioration and condition of an asset, for example the Council could be carrying an asset at an amount that does not reflect its actual condition. This is particularly so for those assets which are not visible, for example stormwater, wastewater and water supply pipes which are underground. This risk is minimised by Council performing a combination of physical inspections and condition modelling assessments of underground assets.
- Estimating any obsolescence or surplus capacity of an asset.
- Estimates are made when determining the remaining useful lives over which the assets will be depreciated. These estimates can be impacted by the local conditions, for example weather patterns and traffic growth. If useful lives do not reflect the actual consumption of the benefits of the asset, then New Plymouth District Council could be over estimating the annual depreciation charge recognised as an expense in the Income Statement. To minimise this risk New Plymouth District Council’s infrastructural asset useful lives have been determined with reference to the NZ Infrastructural Asset Valuation and Depreciation Guidelines published by the National Asset Management Steering Group, and have been adjusted to local conditions based on past experience. Asset inspections, deterioration and condition modelling are also carried out regularly as part of the New Plymouth District Council’s asset management planning activities, which gives New Plymouth District Council further assurance over its useful life estimates.
Foreign currency
The Council undertakes transactions in foreign currencies. These are transacted at our bank’s applicable foreign currency buy or sell rates on the day the transaction is settled.
At balance date the council converts any balances or investments denominated in foreign currency at the closing rate quoted by Reuters on that date.
Derivative financial instruments
The Council uses derivative financial instruments (interest rate swaps) to hedge its risk associated with interest rate fluctuations. Such derivative financial instruments are initially recognised at fair value on the date on which the derivative contract is entered into and subsequently re-measured to fair value. Derivatives are carried as assets when their fair value is positive and as liabilities when their fair value is negative.
Swaps are entered into with the objective of reducing the risk of rising interest rates. Any gains or losses arising from the changes in fair value of derivatives are taken directly to profit or loss for the year. The fair value of interest rate swaps is determined by reference to market values for similar instruments.
The net differential paid or received on interest rate swaps is recognised as a component of interest expense or interest revenue over the period of the agreement.

Changes in accounting policies

There has been no change in accounting policies. Return to top

Funding Impact Statement

Section 10 of Part 1 of the 10th Schedule of the Local Government Act 2002 requires that a community plan includes a funding impact statement which includes:

A. Information that discloses the revenue and financing mechanisms to be used by the Council.

B. An indication of the level or amount of funds to be produced by each mechanism.

C. Information about general rates.

D. Information about targeted rates.

E. For each mechanism used, a statement of the estimated revenue levels, other sources of funds and rationale for their selection in relation to each group of activities.

If the same mechanism is to be used in more than one year of the years covered by the Community Plan the information required for C, D and E need only be given for one of those years.

C and D

The information required in the Funding Impact Statement as regards general rates and targeted rates is contained in the rating system and impact on 2009/10 overall funding levels section.

A and B

As indicated in the Revenue and Financing Policy (Volume 2) the mechanisms to be used are as listed below. In addition, it is anticipated that each of these mechanisms will be used in most of the years covered by the Community Plan.

E (Funding mechanisms by group activities for 2009/10 year)

Return to top

Rating System and Impact on 2009/10 Overall Funding Levels

Rating policies, system and indicative rates

This rating policy summary should be read in conjunction with the Council’s Revenue and Financing Policy in Volume 2.

All figures in this policy summary are GST inclusive and are shown in the overall funding levels section.

1. General rates

The Council has set a general rate based on the land value of each rating unit in the district together with a uniform annual general charge applied to all separately used or inhabited parts of a rating unit.

1.1 Uniform annual general charge portion

The uniform annual general charge (UAGC) is a fixed amount payable for every separately used or inhabited rating unit in the district. It is calculated according to the judgement of the Council on what is the proper balance between the fixed and variable parts of the general rate, and on any consequential impacts on individual and groups of ratepayer.

Separately used or inhabited - for a commercial rating unit. Means a building or part of a building that is, or intended to be, or is able to be, separately tenanted, leased or subleased for commercial purposes.

Separately used or inhabited - for a residential rating unit. Includes a building or part of a building that is, or intended to be used as, or is able to be used as, an independent residence, including apartments, semi-detached or detached houses, units, town houses and baches.

Both the general rate and the uniform annual general charge will be used to fund, or assist with funding, all council activities other than those funded by way of targeted rates for water supply, sewage disposal, roading and refuse collection and kerbside recycling.

1.2 Differential land value portion and categories

The Council differentiates this portion of the general rate based on land use (Schedule 2 Local Government (Rating) Act 2002).

The differential categories and percentages applied to each group are:

Group 1: Commercial/Industrial. All rating units that are used primarily for any commercial or industrial purpose. 27.2%
Group 2: Residential. All rating units with a land area of one hectare or less, not being rating units in Group 1, used for residential and related purposes. 54.0%
Group 3: Small Holdings. All rating units, not being rating units included in Groups 1 or 2, having a land area of more than one hectare but no greater than four hectares. 3.0%
Group 4: Farmland. All rating units, not being rating units included in Group 1, 2 or 3, having a land area in excess of four hectares. 15.8%
Total: 100.0%Return to top

2. Targeted roading rate

The targeted roading rate is an annual charge payable for every separately used or inhabited rating unit in the district. It is calculated according to the judgement of the Council on what is the proper balance between the fixed and variable parts of the rates funding for the roading activity, and on any consequential impacts on individual and groups of ratepayers.

3. Targeted service charges

The Council levies targeted ‘service charges’ for:

Water supply.
Sewage treatment and disposal.
Refuse collection and disposal.

Only those properties that actually receive the service are liable for these charges, irrespective of differential category. The Council calculates and levies these charges separately from rates. This is because rates apply to all properties in the district – to pay for services that are available to the community as a whole, whereas the individual service charges only apply to properties which receive the specific service covered by the charge.

- Water supply (non metered and metered)

The Council has three mechanisms of payment for water supply. All are deemed to be rates in the Local Government Rating Act 2002. These are:

: A uniform targeted rate for each separately used or inhabited part of a rating unit, which is not metered and is connected to an urban water supply.

: A rate per cubic metre of water supplied for each separately used or inhabited part of a rating unit which is metered and connected to an urban or rural water supply.

: A restricted flow rate determined by the (user-nominated) volume of water able to be supplied within a fixed time period to a separately used or inhabited part of a rating unit for properties that are not metered and are connected to a rural water supply.

For properties that are not connected to an urban or rural water supply, payment is not required.Return to top

- Sewage disposal

The Council proposes to set a targeted rate for sewage disposal based on a uniform targeted rate per separately used or inhabited part of a rating unit in respect of each water closet or urinal connected either directly or through a private drain to a public sewerage drain provided that:

: Every separately used or inhabited part of a rating unit used exclusively or principally as the residence of not more than one household shall be deemed to have not more than one water closet or urinal.

: Where a separately used or inhabited part of a rating unit, not being used as a residential property as in (a) above, has two or more water closets or urinals, the targeted rate per water closet or urinal will be set as per the scale shown at the end of this section.

Rating units which are neither connected to the sewerage system or are not serviceable are not liable for this rate.

The Council may use lump sum contributions, in lieu of part of the targeted rate for sewage disposal, for the purpose of contributing to sum or the capital costs of new sewerage connections.

- Refuse collection and kerbside recycling

The Council has set a targeted rate for refuse collection and kerbside recycling based on a uniform targeted rate per separately used inhabited part of a rating unit used as a household unit situated in defined areas of the district in which the Council is prepared to provide the service for which the charge is made.

4. Due Dates and Penalties

The Council’s rates for the 2009/10 year (1 July 2009 to 30 June 2010) will become due and payable by four equal instalments on the following dates:

Instalment 1 = 26 August 2009

Instalment 2 = 25 November 2009

Instalment 3 = 24 February 2010

Instalment 4 = 26 May 2010

The Council will charge a penalty of 10 per cent on any part of each respective instalment that remains unpaid after the due dates listed above.

In addition, the Council will charge a penalty of 10 per cent on any rates that were assessed or levied in any previous financial years and which remain unpaid on 30 September 2009 and a further additional penalty of 10 per cent on any rates that were assessed or levied in any previous financial years and which remain unpaid on 31 March 2010.Return to top

Overall funding levels

	2008/09 ($)	2009/10 ($)
Uniform annual general charge (UAGC)	10,671,700	10,678,100
General rate	24,030,200	25,275,200
Sub total (general rates)	34,701,900	35,953,300
Uniform annual roading charge (new charge)		3,313,900
Uniform annual drainage charge (UADC)	10,029,500	10,270,900
Uniform annual water charge (UAWC)	6,624,000	6,739,700
Uniform annual refuse charge (UARC)	1,126,600	1,246,900
Sub total (targeted rates/charges)	17,780,100	21,571,400
Water by meter charges	3,584,900	3,620,700
Total	56,066,900	61,145,400
plus GST	7,008,363	7,643,175
	63,075,263	68,788,575

Rates and charges (including GST)

	2008/09 ($)	2009/10 ($)
General rates
Uniform annual general charge	362.50	362.50
Differential rates:
- Group 1 (Commercial/Industrial)	1.3248c*	1.3753c*
- Group 2 (Residential)	0.2955c*	0.3147c*
- Group 3 (Small Holdings)	0.1623c*	0.1719c*
- Group 4 (Farmland)	0.1627c*	0.1695c*
Targeted rates/charges
Uniform annual roading charge (new charge)		112.50
Uniform annual refuse charge	52.00	55.00
Uniform annual drainage charge (scale of charges per water closet or urinal):
- One to two	415.00	424.50
- Three	320.00	327.50
- Four	276.50	283.00
- Five	233.75	239.00
- Six to 10	208.00	213.00
- 11 to 15	190.25	194.50
- 16 to 20	181.75	186.00
- 21 or more	173.25	177.25
Uniform annual water charge	290.00	294.00
Water by meter (WBM)
- On demand supplies:
: Supply charge (for all metered customers)	125.00	130.00
: WBM all metered customers	1.05**	1.12**
: WBM large industrial (>50,000 cubic metres)	0.90**	1.00**
- Waitara industrial supply (untreated supply)	0.70**	0.80**
- Restricted flow connections	160.00	180.00

* cents per $ of rateable value
** cents per cubic metre

The following table provides a summary of some of the new major projects that have been included in this Community Plan. These projects are in addition to the normal day-to-day operations of the Council. They are in response to community, elected member or staff requests to address specific issues in the community or Council organisation. The table shows the capital cost over the first three years as well as the total capital cost over the life of the plan excluding inflation, i.e. in 2008/09 dollar terms.Return to top

Funded Projects

Programme	2009/10	2010/11	2011/12	Total Capex 2009-2019
Recreation and Events
Festival street lighting improvements	0	30,000	30,000	270,000
Festival of Lights improvements	0	37,500	37,500	250,000
Parks
New district cemetery	100,000	630,000	620,000	1,350,000
Improvement of Onaero Camping Ground	0	29,900	142,300	1,249,200
Improvement of Urenui Camping Ground	0	244,000	480,000	900,800
Public toilets - new and cleaning	175,000	130,000	130,000	1,460,000
Cemeteries - new memorial beams	0	12,000	12,000	108,000
Oakura cemetery extension	0	0	0	100,000
Urenui cemetery extension	0	0	0	9,800
Disability access to parks	0	20,000	20,000	180,000
Improved communication systems (parks)	0	216,000	252,000	468,000
Implementation Coastal Strategy	0	0	0	255,000
Sports parks - fine turf (major upgrade)	0	0	0	350,000
Karo Park provision driveway lighting	0	0	0	25,000
Sports park - TET Stadium	0	80,000	0	80,000
Parks Reserves Plan	0	20,100	20,100	180,900
Roading/parking at Kawaroa Park	0	70,000	0	70,000
Walkway development associated with growth	0	150,000	150,000	1,350,000
Waitara River Path	0	0	0	700,000
Pukekura Park Master Plan	0	0	0	1,200,000
East End Reserve skate bowl - addition to existing skate park	0	160,000	0	160,000
Neighbourhood Reserves Management Plan implementation	0	0	0	462,000
District halls development (includes Waitara Hall theatre upgrade)	0	0	0	815,000
Roads
Land purchase for street widening (urban)	192,600	192,600	192,600	1,926,000
Bell Block bypass associated roading improvements	790,000	300,000	300,000	1,390,000
Waiwhakaiho bridge and coastal pathway	2,193,000	0	0	2,193,000
New kerb and channel (Part A)	307,100	307,100	307,100	3,071,000
New footpath construction (Part A)	100,000	100,000	100,000	1,000,000
Upgrade footpath - Brougham Street	0	0	0	1,000,000
Minor improvements (rural)	575,900	575,900	575,900	5,759,000
Geometric improvements (rural)	171,300	171,300	171,300	1,713,000
Subdivision contribution (urban)	0	100,000	100,000	900,000
Cycle Strategy implementation	0	150,000	150,000	1,350,000
Minor improvements (urban)	384,600	384,600	384,600	3,846,000
Preventative works and emergency reinstatement	500,000	504,000	504,000	5,036,000
Associated improvements	345,700	345,700	345,700	3,457,000
Streetlighting improvements (urban)	0	0	0	2,773,400
Intersection improvements (urban)	0	0	0	1,123,500
Dust coat seals and seal extensions	0	220,000	220,000	1,980,000
Crime prevention cameras	50,000	0	0	50,000
Solid Waste and Refuse Collection
Category 1 - renewal driven augmentation and capital projects	50,000	50,000	50,000	500,000
Category 2a - feasibility study landfill gas recovery project	100,000	50,000	100,000	250,000
Category 6 - committed works	450,000	450,000	150,000	1,050,000
Stormwater
Category 1 - pipeline renewal driven upgrades	0	709,000	666,700	3,855,100
Category 3 - treatment projects	0	150,000	100,000	350,000
Category 4 - treatment projects	50,000	40,000	100,000	430,000
Category 6 - commited works	0	745,300	660,000	2,364,300
Category 7 - maintenance contract works	100,000	100,000	100,000	1,000,000
Category 8 - management projects	0	25,000	25,000	225,000
Water
Category 1 - pipeline renewal driven upgrades	30,000	30,000	30,000	300,000
Category 3 - treatment projects	202,500	30,000	30,000	1,522,500
Category 4 - growth projects	65,000	425,000	20,000	650,000
Category 6 - committed works	1,300,000	0	0	1,300,000
Category 7 - maintenance contract works	150,000	150,000	150,000	1,500,000
Category 8 - management projects	25,000	25,000	25,000	250,000
Wastewater
Category 1 - pipeline renewal driven upgrades	60,000	60,000	60,000	600,000
Category 1a - Pukekura Park sewer capacity upgrade	175,000	150,000	0	325,000
Category 2a - feasibility study Urenui-Onaero sewerage scheme	0	0	300,000	500,000
Category 3 - treatment projects	0	422,000	1,080,000	1,502,000
Category 3a - New Plymouth Wastewater Treatment Plant capacity upgrade	250,000	1,000,000	5,000,000	15,000,000
Category 4 - growth projects	291,500	413,500	420,000	2,165,000
Category 6 - committed works	85,000	0	0	8,702,900
Category 7 - maintenance contract works	150,000	150,000	150,000	1,500,000
Category 8 - management projects	25,000	25,000	25,000	250,000
Cultural Services
Book lending system	500,000	0	0	1,000,000
Improve Puke Ariki book fund	0	100,000	100,000	900,000
Regulatory Services
Dog pound development project	0	35,000	400,000	885,000
TOTALS	9,944,200	10,515,500	14,986,800	99,438,400

Projects supported by the New Plymouth District Council but funded from other sources include:

Inglewood Town Hall - remainder of funds for refurbishment.
Urenui Community Hall - improvements.
Waitara - reinstatement of half tide wall.

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Community Plan 2009-2019

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Section 8: Financial Implications and Forecast

Prospective financial statements

Financial Overview

Prospective Statement of Comprehensive Income

Prospective Statement of Financial Position

Financial Assumptions

Levels of service

Rating base

Inflation

Interest rates

New Zealand Transport Agency subsidy rates

Development Contributions and Borrowing

Council’s key financial strategies

Rates remissions

Asset sales

Investments

Perpetual Investment Fund

Revaluation of non-current assets

Depreciation on asset acquisitions

Adoption of Council policies

Capital structure

Significant contingencies/commitments

Risks

Balancing the Budget

Prospective Financial Statements

Prospective Financial Plan (based on the 2009/10 budgets)

Prospective Statement of Comprehensive Income

Prospective Statement of Changes in Equity

Prospective Statement of Financial Position

Prospective Statement of Cashflow

Statement of Accounting Policies

Reporting entity

Measurement base

Accounting policies

Changes in accounting policies

Funding Impact Statement

C and D

A and B

E (Funding mechanisms by group activities for 2009/10 year)

Rating System and Impact on 2009/10 Overall Funding Levels

Rating policies, system and indicative rates

Overall funding levels

Rates and charges (including GST)

Funded Projects

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