Mayor Grant Smith says the vision that underpins this 10 year Plan is ‘small city benefits, big city ambition’.
“Internationally, we are a small city, and this reflects the value we all place on the great quality of life, sense of community and affordable access to services. We also have the ambition of larger cities though, and the opportunities they offer, which come from well-planned growth and sustainable management of our resources with education and employment,” he says.
The draft 10 Year Plan outlines Council’s business-as-usual services like roads, water supply, and parks and reserves, and their forecast costs over the next decade.
“Basic infrastructure like these, as well as wastewater and stormwater, account for over three quarters of the capital spend. This equates to $590m of the $765m proposed capital spend,” says Mayor Smith.
The Plan also includes proposed new investments to ensure the city continues to thrive. These include projects designed to:
- Create a more vibrant city centre, which will in turn attract business investment and visitors into the city, delivering benefits to the city as a whole.
- Develop recreation activities along the Manawatū River, which will provide great lifestyle benefits for our residents, and contribute to enhancing Palmerston North city’s reputation as a great place to live, work, study or visit.
- Ensure that we have the land and infrastructure for sustainable growth in population and employment opportunities.
- Future-proof the city’s wastewater system – our consent to discharge treated wastewater from the treatment plant into the Manawatū River will expire in 2028, so we will need to upgrade or replace the plant over the next 10 years. This needs to be budgeted for now. This draft 10 Year Plan provisions $128.8m to upgrade to a state of the art treatment plant with continued discharge into the River. No firm decisions have been made yet, as further options are examined, including land or ocean at a cost of $250-$300m.
“The rise of ‘small cities’ is a worldwide phenomenon as new technologies, the cost of big city living, and the pressures that brings, is leading people to choose a different way to live. All of regional New Zealand has the opportunity to benefit from demographic, technological, economic, social and environmental change. For example, technology-driven disruption of traditional industries and changes in the nature of work are influencing people’s choices about where and how they live, work, study and play, especially in the context of housing affordability,” says Mayor Smith.
“For Palmerston North city, these demographic changes are likely to have a significant long-term impact on, and create new opportunities for, our traditional sectors such as defence, research, education, agribusiness, health, and logistics. There are also opportunities to diversify our economy, given our natural advantage as the ‘capital’ of the productive Manawatū region, situated at the cross-roads of central North Island.
“But we have to be able to successfully compete as a place where ‘talent wants to live’, which requires us to make some prudent investments for the future, as our counterparts in other regions are doing, while balancing affordability for ratepayers,” says Mayor Smith.
In order to fund existing council services and the key projects Council is proposing in this Plan, debt would need to increase to $349m. Debt funding helps to ensure the costs of these projects is shared across current and future generations who will also use and benefit from them.
Along with this, rates would need to increase, with proposed total rates increases over the 10 year period from 2.6% to 6.6%. In year one, the total rates increase would be 6.4%, which equates to an increase of $2.80 a week for an average ratepayer.
“We know rates rises are never welcomed, and no Council enjoys raising them, but this is about investing in our future. It’s also important to remember that even if we were just to maintain with the status quo and invest in nothing new, rates would still need to go up by around 3.5% in year one, because operational costs increase every year and we have to factor-in the cost of upgrading or replacing our wastewater treatment plant no matter what.
“A status quo approach would mean at best we’re standing still as a city, and would potentially mean we’d be going backwards compared with all the other regional cities that are investing,” says Mayor Smith.
The rates increase that is signalled includes the cost of Council’s proposal to pay down our debt faster to deliver significant long-term savings from paying less interest (just like a mortgage).
“We are proposing to reduce the term of our debt from 30 to 20 years, which will save $10m in interest over this period. Of the 6.4% proposed total rates increase, 1.7% of this is tagged towards debt repayment. This saving can in turn be put to use on other projects to deliver on our vision,” says Mayor Smith.
The detailed information on all of the draft 10 Year Plan proposals is included in the Consultation Document and supporting documents and strategies signed-off today, which will be available at thebigpicture.pncc.govt.nz or the Council office and service centres from 19 March. Councillors will also be out in the community talking to the community about the Plan throughout the consultation period, which runs to 23 April.
“We encourage everyone to familiarise themselves with what’s proposed in the draft 10 Year Plan and to give us your feedback so that it truly reflects the community’s wishes. The Plan will be finalised and formally adopted in June, after we have considered all of our community feedback,” says Mayor Smith.