1. Purpose
1.1 The purpose of this policy is to detail Timaru District Council’s approach to funding its operating and capital expenditure.
1.2 It determines who pays for Council activities, and on what basis, with a view to achieving the fairest funding mix for the community as a whole.
1.3 The overall objective of this policy is to ensure users and beneficiaries of Council services pay what is fair and equitable.
2. Glossary
Note: The definitions provided are intended to explain terms used on this policy in plain English. Legal definitions ar provided in the Local Government Act 2002 and the Local Government (Rating) Act 2002.
Benefit: refers to the positive effect able to be gained as a result of a Council-provided activity or service, regardless of whether this is taken up or not.
Capital expenditure: means expenditure on new assets or on assets that increase the level of service provided, or extend the level of service – for example the replacement of assets.
Community-wide benefit: means a benefit that applies to the whole community, irrespective of property location or value.
Council: means Timaru District Council
Exacerbator: those who contribute to, or create the need for a Council service or facility, and should, therefore contribute to the cost of the service or facility.
General Rate: is a rate levied on all rateable properties within Council’s jurisdiction. A general rate is based on:
- Land value of a property
- How the property is used
Intergenerational equity: is the principle that the cost of an asset or service should be spread over its life, so that both current and future residents who benefit contribute a fair share of the costs, and not just current residents.
Land Value (LV): Means the assessed value of land, excluding capital improvements, at the time of valuation.
Operating expenditure: means the costs incurred to provide normal day-to-day services and the maintenance of services and assets.
People benefit: is a benefit that people and residents can enjoy without owning a property. Council looks to fund people benefit through uniform annual charges.
Private good: means goods or services that directly benefit an individual rather than the community as a whole. Private good is an indicator that users who directly benefit should pay.
Property benefit: is a benefit that accrues to a property or to property owners. This may be a service to a property, or an activity that benefits property values. Council looks to fund property benefit through general rates based on land value.
Public good: means goods or service that one individual can consume without reducing the availability to another individual. Public good is usually both non-rival and non-excludable. An example of public good is a community park.
Rates: are funds collected by Council through taxes on property within the district.
Targeted rates: a rate charged for a specific service through a tax on each rateable unit or separately used or inhabited portion of a rating unit to ensure that the cost of a service or activity is borne by those who derive most benefit from it, or who contribute to the need for the service or activity.
Uniform Annual General Charge: a charge of an equal amount on each rateable unit or separately used or inhabited portion of a rating unit to ensure that all ratepayers make a minimum contribution to Council activities and services. This charge is applied to fund services where community benefits apply across the district.
User charges: a council charge paid by those who use specific services provided by Council
3. Policy Context
Local Government Act
3.1 The Local Government Act 2002 (LGA) requires Council to adopt a Revenue and Financing Policy.
3.2 Sections 102 and 103 of the LGA require the policy to demonstrate how operational expenditure and capital expenditure are funded from:
- General rates, including –
- Choice of valuation system; and
- Differential rating; and
- Uniform annual general charges:
- Targeted rates:
- Lump sum contributions:
- Fees and charges:
- Interest and dividends from investments:
- Borrowing:
- Proceeds from asset sales:
- Development contributions:
- Financial contributions under the Resource Management Act 1991:
- Grants and subsidies:
- Other sources of income.
3.3 Section 101(3)(a) of the LGA requires that Council has, for each activity funded, shown it has given consideration to the:
- Community outcomes to which the activity primarily contributes; and
- Distribution of benefits between the community as a whole, and identifiable part of the community, and individuals; and
- The period in or over which those benefits are expected to occur; and
- The extent to which the actions or inaction of particular individuals or groups contribute to the need to undertake the activity; and
- Costs and benefits, including consequences for transparency and accountability, of funding the activity distinctly from other activities; and
3.4 In accordance with section 101(3)(b), Council must also consider the overall impact of any allocation of liability for revenue needs on the current and future social, economic, environmental, and cultural well-being of the community.
Related Council Plans, Policies and Strategies
3.5 Council’s Revenue and Financing Policy provides a high level funding framework that links with other Council documents that impact on funding decisions for the wider community and, in some cases, or individual ratepayers. These documents include:
Financial Contributions Policy: Details the basis on which Council charges financial contributions to offset or mitigate any adverse impacts on the natural or physical environment including utilities, services or a new development.
Timaru District Plan: Section 6 of the District Plan details Council’s approach to charging financial contributions for new developments under the Resource Management Act 1991.
Significance and Engagement Policy: Details Council’s approach to determining the level of significance of a particular proposal or decision, and how Council will engage with the community based on the level of significance. Decisions about the funding of Council activities will be assess in accordance with this policy.
Rates Remission and Postponement Policy: Details the circumstances in which Council will provide a rate remission or postponement, including on Maori Freehold Land, and the rationale for this.
Infrastructure Strategy: Details Council’s approach to the provision of core infrastructure, how much it intends on investing over the next 30 years, and how this investment will be funded. Activities included in the strategy are: roads and footpaths, drinking water, sewer, stormwater, waste management and large community facilities (for example, CBay Aquatic Centre).
Financial Strategy: Details Council’s approach to delivering its high-level funding requirements, including limits on rates and borrowing. The Financial Strategy considers the impact of expected changes in population and the use of land, the expected impact of Council’s Infrastructure Strategy and other significant factors affecting Council’s ability to maintain and meet demands for services.
Funding Impact Statement: Provided in each Long Term Plan and Annual Plan, the funding impact statement details the application and impact of the Revenue and Financing Policy for each financial year.
4. Rating Framework
4.1 Councils are able to use a variety of approaches in their overall rating framework. These approaches are how Council applies rates in the district, and include the following:
Valuation System
4.2 When applying rates based on property values councils can rate according to land value, capital value, or annual value.
4.3 Timaru District Council uses the land value rating system. The land values are determined by an independent valuer who is audited by the Valuer General.
Differential Rating
4.4 When applying rates councils can rate properties using a differential according to a range of categories detailed in schedule 2 of the Local Government (Rating) Act 2002.
4.5 Council’s general rate is set based on a rate per dollar of rateable land value, and differentiated on the use to which the land is put. The objective of differential rating is to ensure a fair and equitable proportion of rates are paid by the various differential categories.
4.6 Council uses differentials to distribute the general rate between particular categories of the community, as listed below. This does not change the total amount of general rates funding required annually, but rather, the proportion of overall funding of the general rate from each category differs according to the differential factor applied.
4.7 The differential is applied to the following nine categories:
Category | Definition |
|---|---|
Accommodation | All properties used primarily for hotel, motel or similar short term or travellers’ accommodation purposes. |
Commercial – Central | All properties situated within the Timaru Central Business District and used primarily for commercial purposes. |
Commercial – Other | All properties used primarily for commercial purposes other than those situated in the Timaru Central Business District. |
Community Services | All properties used primarily for education, religious, and/or community purposes. |
Industrial | All properties used primarily for industrial purposes. |
Primary | All properties used primarily for agriculture, horticulture or pastoral purposes, including the grazing of animals. |
Recreational | All properties used primarily for active or passive indoor/outdoor recreational activities. |
Residential – General | All properties used primarily for residential accommodation of a single household or used for residential purposes and not otherwise classified or which are vacant or of not determined use of those differential categories and situated in an area in which residential dwellings are permitted. |
Residential – Multi Unit | All properties used primarily used for multi-unit residential accommodation, for example, purpose built rental flats. |
Unit of rating – separately used or inhabited parts of a rating unit
4.8 Under the Local Government (Rating) Act 2002 charging separately used or inhabited parts of a rating unit is an option for a uniform annual general charge and for targeted rates.
4.9 A separately used or inhabited part of a property or building includes any part of a rating unit inhabited or used by a person other than the owner, and who has the right to use or inhabit that portion by virtue of a tenancy, lease, licence, or other agreement.
4.10 For the purpose of this policy, vacant land and vacant premises offered or intended for use or habitation by a person, other than the owner, and generally used as such are defined as ‘used’.
4.11 Examples of separately used or inhabited parts of a rating unit include:
- Each separately used or inhabited part of a residential unit will count as a separate part. This includes minor household units with kitchen facilities often referred to as “granny flats”.
- Where residential properties are partially used for business, the number of parts will equal the number of separately used or inhabited residential units plus one for each separate business use (e.g. a house with a doctor’s surgery attached contains two parts).
- In the case of retirement villages or farms with workers’ accommodation and similar types of properties, each separately used or inhabited residential unit and each other major use (such as halls, libraries etc) are separate parts.
5. Rate Revenue Sources
5.1 The rates charged by Council as sources of funding are:
General Rate
5.2 A rate charged on all rateable properties in the district on the basis of land value, and differentiated by the use of the property.
Uniform Annual General Charge (UAGC)
5.3 A rate charged on all separately used or inhabited portions of a rating unit on a uniform basis. This rate enables all ratepayers to make a minimum contribution to Council’s costs. The annual increase in the UAGC will be an overall percentage increase as the general rate increase within a margin of 5% in any given year or as per section 13 – Funding Analysis for Council Activities.
Targeted Rate
5.4 A rate charged on specific properties in the district on the basis of the property or owner being able to receive benefit from the service provided that is not available to all. Targeted rates may be charged on the basis of land value, differentiated or as a uniform annual charge.
6. Non-Rate Revenue Sources
6.1 Council has a range of funding sources available which are often suited to a particular type of funding requirement. While rates are often the most appropriate source of funding for a particular requirement, Council may decide to use other sources of funding, if appropriate.
Grants and subsidies
6.2 Council expects to continue to receive substantial subsidies from Waka Kotahi (New Zealand Transport Agency – NZTA) for road and footpath maintenance and renewal and other expenditure related to transportation and its land transport networks.
6.3 Council can receive grants and sponsorship for projects which are eligible for particular grant and sponsorship schemes.
Investment income, dividends and interest
6.4 Interest and investment returns from Council’s investments, including annual dividends from Timaru District Holdings Limited (TDHL) are generally used to offset the general rate and the uniform annual general charge.
6.5 Interest earned on special funds and separate reserves is used only for the purpose of the fund or reserve.
Financial contributions
6.6 Council’s existing Financial Contributions Policy allows Council to apply a charge for water, sewer, stormwater and open space and recreation. Minor amounts of capital expenditure budget for the Parks and Recreation activity have been identified as coming from financial contributions. Amounts to be funded from financial contributions for water supply, sewer and stormwater services will be determined from Council decisions at the time of development.
Proceeds from asset sales
6.7 Council may sell assets that are deemed to be surplus to requirements or that are not providing satisfactory returns. Proceeds may be invested, used to fund capital expenditure or operating expenditure associated with the activity which held the original asset.
6.8 Council may, in exceptional circumstances, choose to use proceeds of asset sales for expenditure in another activity.
Fees and Charges
6.9 Council charges for some services it provides and this revenue funds all or part of the cost of service delivery for these activities. Examples include resource and building consent fees, dog registration fees and facility admission or hire.
6.10 Council will amend its fees and changes annually (or more frequently as appropriate) to reflect increases in costs as measured by the assumed rate of inflation and/or to maintain the cost recovery levels underlying the basis for setting the fee levels.
Bequests
6.11 Council occasionally receives bequests that can be used, normally for a specific purpose. Examples include bequests for the purchase of library books or art work.
Borrowing
6.12 Council generally borrows to fund capital expenditure as a way of promoting intergenerational equity and as a way to make the significant cost of some capital projects affordable. Borrowing may be internal (i.e. Council borrowing from itself by using its own reserves) or external.
6.13 Council does not borrow for operational expenditure unless this is deemed to be prudent and is approved by Council on that basis.
Lump Sum Contributions
6.14 Council may offer the option for ratepayers to pay their share of a capital project through a lump sum payment rather than through rates over a longer period of time. This can be beneficial for all parties as it reduces the interest paid by ratepayers over the life of the loan, and Council can retire a portion of debt earlier or reduce the need for borrowing.
7. Funding Operational Expenditure
7.1 Operating expenditure is the day-to-day cost Council incurs to provide services, including the maintenance of existing assets.
7.2 Council has determined that the following sources may be used to fund operating expenditure:
- Rates revenue (including general rates and UAGC)
- Targeted rates
- Fees and charges
- Interest and dividends from investments
- Proceeds from asset sales
- Financial contributions
- Grants and subsidies
- Borrowing
- Other operating revenue
7.3 Council may choose not to fully fund operating expenditure in any activity in any particular year if the deficit can be funded from operating surpluses in the immediately preceding or subsequent years.
7.4 An operating deficit will only be budgeted when considered prudent to avoid significant fluctuations in rates, fees or charges. Council will consider the requirements of section 100 of the LGA (Balanced Budget requirements).
7.5 Council may choose to fund more than is necessary to meet its operating expenditure in any particular year. Council will only budget for an operating surplus to fund an operational deficit in the immediately preceding or following years, or to repay debt. Council will have regard to forecast future debt levels when deciding whether it is prudent to budget for an operating surplus for debt repayment.
8. Funding Capital Expenditure
8.1 Capital expenditure is expenditure on new or existing assets that maintains or increases their value and the level of service to the community.
8.2 Council usually borrows, either internally or from capital markets, to fund capital expenditure. Borrowing for capital expenditure enables Council to spread the cost of providing a capital asset over the expected life of the asset. Council may choose to fund capital expenditure through borrowing and repay the loan over a shorter or longer period if this is considered prudent.
8.3 Borrowing for capital expenditure reduced peaks and troughs in the funding required each year and promotes intergenerational equity. This ensures today’s ratepayers are not required to fund the whole cost of assets with a long useful life and subsequent users of the assets also make a contribution to its cost by contributing to the interest and principal repayments in those subsequent years.
8.4 Council’s borrowing requirements and the cost of servicing loans for capital expenditure may be reduced to the extent that other funding sources can be used.
8.5 Council has determined that the following sources may be used to fund capital expenditure:
- Rates revenue (including general rates and UAGC)
- Targeted rates
- Lump sum contributions
- Interest and dividends from investments
- Borrowing
- Proceeds from asset sales
- Financial contributions
- Grants and subsidies
- Reserve funds
- Other sources.
8.6 Borrowing for capital expenditure is undertaken in accordance with Council’s Financial Strategy.
9. Funding of Depreciation
9.1 Depreciation is the process of recognising that an asset is progressively used up over its useful life. By funding depreciation Council is able to provide funding to replace assets at the end of their useful life, or reduce the amount borrowed against the assets. Depreciation is funded within each activity as part of the operating expenditure each year.
9.2 In general, Council will fully fund depreciation over the life of an asset in order to systematically allocate the use or consumption of the asset, unless this is not considered to be in the best interests of the community. If Council decides not to fully fund depreciation of an asset it will provide the community with information on why it has decided not to fully fund depreciation and the likely impact of this decision.
10. Activity Funding Analysis
10.1 Council has considered each activity, and in some cases discrete items within an activity, to determine the most appropriate funding approach.
10.2 Council endeavours, where possible, to allocate cost to the primary beneficiary of any function or activity it provides.
10.3 The following matters considered in the assessment are:
Distribution of benefits
10.4 The benefits provided by each activity are assessed to establish to whom these flow. Benefit distribution is assessed using three categories; private benefit, group benefit and community-wide benefit.
10.5 Private Benefit: accrues to identifiable individuals. Activities that provide a high level of private benefit will normally be funded from fees and charges.
10.6 An example of a Council service that provides a high level of private benefit is the processing and granting of a consent. This enables the applicant applying for a consent to undertake an activity that primarily benefits them.
10.7 Group Benefit: accrues to identifiable groups within the community. Activities that provide a high level of group benefit will normally be funded from a targeted rate or charge on properties able to receive the service.
10.8 An example of a Council service that provides a high level of group benefit is the provision of drinking water. Only those able to connect to the drinking water supply are able to benefit.
10.9 Community-wide Benefit: accrues to the community as a whole. Activities providing a high level of community-wide benefit will normally be funded from the community as a whole, through the general rate or the UAGC.
10.10 An example of a Council service that provides a high level of community-wide benefit is the provision of the roading network. Everyone has the opportunity to access and use the service.
Period of benefit
10.11 Council considers the period over which the benefit provided by an activity flows. This provides a rationale for deciding the period over which the expenditure should be funded.
10.12 If the benefit an activity provides relates wholly or largely to the immediate year then the activity will normally be funded from rates or other income in the year the expense is incurred.
10.13 If the benefit is available over a longer period of time Council will normally borrow to fund the activity or asset to ensure future ratepayers who will enjoy some benefit will pay a fair proportion of the cost.
Control of negative effects (exacerbator pays)
10.14 Council may incur expenditure to protect the community from actual or potential problems. Council looks to identify the cost to the community of controlling negative effects caused by individual or group actions and to recover any costs directly from those causing the problem. Examples are animal control (funding through dog registrations and impoundment fees) and parking enforcement (funding through parking meter fees and infringement fees).
10.15 Where a fee or charge is not practical or efficient the cost will normally be funded as if it provides a community-wide benefit – through the general rate or UAGC.
Distinct Funding
10.16 Transparency and accountability are more evident when an activity is funded separately from other activities. This allows ratepayers, or payers of user charges to see how much money is being raised and spent on the activity, and whether or not the cost of the activity represents value for money.
10.17 Council will consider the costs and benefits of distinct funding of an activity, including the consequences of the chosen funding method in terms of transparency and accountability. Council will fund activities distinctly where this is practical and efficient.
10.18 All activities that are funded distinctly are detailed in section 12 of this policy.
Property versus people benefit
10.19 When deciding on the appropriate funding mechanism, Council will consider whether the benefit provided by an activity flows primarily to the value of the property or to the people who live at the property.
10.20 In general, Council will look to fund property-related benefit through the general rate, based on land value, and people-related benefit though the UAGC rate (all properties being charged a uniform amount).
Community Impact
10.21 Council must consider the overall impact the allocation liability has on the social, economic, environmental and cultural wellbeing of the community.
10.22 In considering community impact and the allocation of costs, Council will have regard to:
- The impact a particular funding approach may have on the achievement of community outcomes;
- Fairness and equality issues arising from the allocation of costs; and
- Any other inpacts on the community, such as affordability of rates for some or all ratepayers.
10.23 Council may decide to fund an activity in a way other than generally prescribed in this policy if this approach to funding will promote the achievement of community outcomes or will address perceived affordability issues.
Practicality
10.24 Council may choose to make minor variations to the funding approach detailed in this policy for reasons of practicality. This is particularly the case for activities that are partly funded from fees and charges, or from external sources.
10.25 In some cases, the funding from fees and charges and external sources may vary from year to year or may be uncertain at the time of budgeting. In these cases Council may choose to adjust the funding from rates to accommodate changes or uncertainty.
10.26 For activities funded partly from fees and charges, the revenue generated from this source is often dependent on the demand for services at the time. Council may decide to adjust the level of funding from rates to smooth the level of fees and charges from year to year.
10.27 Surplus revenue generated from fees and charges will normally be credited to Council’s general reserves, or to the appropriate specified purpose reserve fund.
10.28 For activities with specified purpose reserve funds, these funds may be used for rates smoothing purposes if Council is able to use the fund in this way and deems this a prudent approach.
10.29 Council may fund minor capital expenditure from operating revenue in the year it is expended. Non-minor capital expenditure items will be funded from reserves or loan funded so as to minimise extreme rate movements and more accurately reflect intergenerational costs.
11. Wellbeing
11.1 Council will give consideration for the overall impact this policy has on the current and future social, economic, environmental and cultural wellbeing of the Timaru District Community.
12. Policy Review
12.1 This policy will be reviewed every three years, as part of the development of the Long Term Plan.
12.2 The policy may be amended at any time, as long as the review process provides for community engagement in accordance with Council’s Significance and Engagement Policy and section 82 of the LGA.
13. Funding Analysis for Council Activities
Governance and Strategy
| Service Provided | Community Wellbeing Outcomes | Who benefits/creates need? | Funding (operating and capital expenditure) |
|---|---|---|---|
| This activity supports and guides all activities carried out by Council and includes; all work associated with elected members (including community board members); community engagement; communications; strategy; policy and plan development; elections; governance functions; performance and accountability reporting. | Connected Citizens | Community-wide Benefit: Benefits the whole community by supporting the decision-making function, representation, advocacy, communication and engagement for all residents. | Operating Expenditure Rates: 90-100% 50% UAGC User Charges: 0-10% Hearings fees etc
Capital Expenditure Borrowing: Loan costs are funded in the same way as operating expenditure. |
Community Support
Airport
| Service Provided | Community Wellbeing Outcomes | Who benefits/creates need? | Funding (operating and capital expenditure) |
|---|---|---|---|
| This activity provides for the management of the Richard Pearse Airport | Enhanced Lifestyle Diverse Economy | Private Benefit: Users of the airport receive the primary benefit from the provision and management of the airport enabling travel, or storage and operation of personal aircraft. Community-wide Benefit: The whole community receives a secondary benefit through access to the airport and the economic benefits the airport provides the district. | Operating Expenditure User Charges: 30-50% Airport charges eg landing fees and lease income Rates: 50-70% 40% UAGC Capital Expenditure Borrowing: Loan costs are funded in the same way as operating expenditure. |
Cemeteries
| Service Provided | Community Wellbeing Outcomes | Who benefits/creates need? | Funding (operating and capital expenditure) |
|---|---|---|---|
| This activity provides for the maintenance and development of cemeteries across the district, including burials and interments. | Resilient Infrastructure Enhanced Lifestyle | Private Benefit: Users of cemetery facilities, largely family and friends of deceased, receive the primary benefit. Community-wide Benefit: The whole community receives benefit through ensuring the deceased are interred in a sanitary way maintaining public health, cemeteries as well maintained public spaces, and the district’s social history is preserved in cemetery records. | Operating Expenditure User Charges: 40-70% Plot purchases and interment fees Rates:30-60% 60% UAGC Capital Expenditure Borrowing: Loan costs are funded in the same way as operating expenditure. |
Community Funding
| Service Provided | Community Wellbeing Outcomes | Who benefits/creates need? | Funding (operating and capital expenditure) |
|---|---|---|---|
| This activity provides for funding, by way of grants and loans, to support individuals, community groups, facilities and events. The activity also provides for rates remissions and swimming concessions. | Connected Citizens Enhanced Lifestyle | Group Benefit: Recipients of the grants and loans receive the primary benefit. Note: Council has determined that charging these groups for this activity would not meet the purpose of this activity or the Community Wellbeing Outcomes. Community-wide Benefit: The funding criteria for the grants and loans is designed to support groups which provide benefits through their activities to the whole community. | Operating Expenditure Rates: 85-95% 80% UAGC Grants: 5-15% Funding received from various funding agencies Interest: 5-15% Interest on loans provided to community groups Capital Expenditure Borrowing: Loan costs are funded in the same way as operating expenditure. |
Emergency Management
| Service Provided | Community Wellbeing Outcomes | Who benefits/creates need? | Funding (operating and capital expenditure) |
|---|---|---|---|
| This activity provides for the development of resilient communities through planning, training, education, co-ordination with partner agencies. This activity also includes provision for the Emergency Response Fund. | Connected Citizens Resilient Infrastructure | Community-wide Benefit: The primary benefit is to the people and property of the whole district, enabling planning to mitigate the harm, and to recover from emergencies. | Operating Expenditure Rates: 100% 50% UAGC Capital Expenditure Borrowing: Loan costs are funded in the same way as operating expenditure. |
Climate Change
| Service Provided | Community Wellbeing Outcomes | Who benefits/creates need? | Funding (operating and capital expenditure) |
|---|---|---|---|
| This activity provides development of climate change mitigation and adaptation strategies and action plans for the district. | Sustainable Environment Resilient Infrastructure Connected Citizens | Community-wide Benefit: The primary benefit is to the people and property of the whole district, enabling the planning to mitigate the harm caused by climate change and to assist the whole district to adapt to both climate change and zero carbon living. | Operating Expenditure Rates: 100% 80% General Rate Capital Expenditure Borrowing: Loan costs are funded in the same way as operating expenditure. |
Economic Development and Tourism
| Service Provided | Community Wellbeing Outcomes | Who benefits/creates need? | Funding (operating and capital expenditure) |
|---|---|---|---|
| This activity promotes and assists economic development and visitor opportunities in the district. | Diverse Economy Enhanced Lifestyle | Community-wide Benefit: This activity provides community-wide benefit through supporting the economic growth and development of the district. Private Benefit: Some benefits may accrue to businesses or individuals using the services this activity provides, e.g. tourism operators. | Operating Expenditure Rates: 90-100% 80% General Rate User Charges: 0-10% User fees for services provided by Economic Development Agency Other: 0-10% Government grants or subsidies Capital Expenditure Borrowing: Loan costs are funded in the same way as operating expenditure. |
Public Toilets
| Service Provided | Community Wellbeing Outcomes | Who benefits/creates need? | Funding (operating and capital expenditure) |
|---|---|---|---|
| This activity provides and maintains public toilets across the district. | Enhanced Lifestyle Resilient Infrastructure | Private Benefit: Users of the public toilets, including visitors to the district benefit, and create the need for this activity. Note: Council does not believe a user pays funding model to be practical or appropriate. Community-wide Benefit: The whole community benefits through the provision of public toilets and maintaining public hygiene. | Operating Expenditure Rates: 90-100% 70% UAGC User Charges: 0-10% User pays may be achievable at some facilities. Capital Expenditure Borrowing: Loan costs are funded in the same way as operating expenditure. |
Social Housing
| Service Provided | Community Wellbeing Outcomes | Who benefits/creates need? | Funding (operating and capital expenditure) |
|---|---|---|---|
| This activity provides and maintains affordable housing across the district for those in need. | Connected Citizens Enhanced Lifestyle | Private Benefit: The tenants of the social housing units benefit from this activity. | Operating Expenditure User Charges: 100% Rental income from tenants. Capital Expenditure Borrowing: Loan costs are funded in the same way as operating expenditure. Grants: Council may seek grant funding and sponsorship to support capital works. |
Environmental Services
Animal Control
| Service Provided | Community Wellbeing Outcomes | Who benefits/creates need? | Funding (operating and capital expenditure) |
|---|---|---|---|
| This activity provides for animal control services including the confining of stray animals and managing aggressive animals. | Enhanced Lifestyle | Private Benefit: The owners of animals, particularly dogs, benefit from, and create the need for this activity. Community-wide Benefit: The whole community benefits from this activity minimising the negative impact of wandering and aggressive animals. | Operating Expenditure User Charges: 90-100% Dog registrations, impounding, infringement and other fees and fines. Rates: 0-10% 100% General Rate Capital Expenditure Borrowing: Loan costs are funded in the same way as operating expenditure. |
Building Control
| Service Provided | Community Wellbeing Outcomes | Who benefits/creates need? | Funding (operating and capital expenditure) |
|---|---|---|---|
| This activity provides for the administration and implementation of the Building Act, including processing and granting consents and inspecting and monitoring building work across the district. | Diverse Economy Resilient Infrastructure Sustainable Environment | Private Benefit: The benefits from this activity mainly accrue to building owners through ensuring they have met legislative requirements Community-wide Benefit: The whole community benefits through this activity ensuring buildings across the district are safe, sanitary and accessible. | Operating Expenditure User Charges: 70-80% Various fees and charges relating to building control services. Rates: 20-30% 100% General Rate Capital Expenditure Borrowing: Loan costs are funded in the same way as operating expenditure. |
District Planning
| Service Provided | Community Wellbeing Outcomes | Who benefits/creates need? | Funding (operating and capital expenditure) |
|---|---|---|---|
This activity provides for the development, adoption and amendment of the Timaru District Plan | Sustainable Environment Diverse Economy Resilient Infrastructure | Community-wide Benefit: The whole community benefits from a District Plan that enables sustainable development within the district. Private Benefit: When individuals seek private plan changes they accrue the benefit. | Operating Expenditure Borrowing: Council will borrow for the operating costs of developing the District Plan, recognising the period benefit for this activity. Loan costs will be funded in the same way as other operating expenditure. Rates: 90-100% Rate funding will be utilised for all other policy work. 100% General Rate User Charges: 0-10% Fees for private plan changes. Capital Expenditure Borrowing: Loan costs are funded in the same way as operating expenditure. |
District Plan Administration
| Service Provided | Community Wellbeing Outcomes | Who benefits/creates need? | Funding (operating and capital expenditure) |
|---|---|---|---|
| This activity includes all aspects of the resource consenting process and other district planning requirements, including receiving and processing the applications, monitoring consents and responding to public enquiries, other permissions and Land Information Memorandums. | Sustainable Environment Diverse Economy Resilient Infrastructure | Private Benefit: Those individuals seeking resource consent or other services primarily benefit from this activity. Community-wide Benefit: There is some benefit to the whole community to ensure consents are processed and monitored through enabling sustainable development Exacerbators: Individuals may contribute to costs through lack of compliance requiring ongoing monitoring and enforcement. | Operating Expenditure User Charges: 80-90% Various fees and charges relating to the resource consenting and other district planning process. Rates: 10-20% 100% General Rate Capital Expenditure Borrowing: Loan costs are funded in the same way as operating expenditure. |
Environmental Compliance
| Service Provided | Community Wellbeing Outcomes | Who benefits/creates need? | Funding (operating and capital expenditure) |
|---|---|---|---|
| This services provides for the administration and monitoring of food safety, liquor licensing, hazardous substances and enforcing the district bylaws | Enhanced Lifestyle Diverse Economy Sustainable Environment | Private Benefit: The benefits accrue to the individuals and businesses that require the services of this activity to meet legislative requirements Community-wide Benefit: The whole community benefits through the provision of a safe and healthy environment and standards of operation being enforced. Exacerbators: Individuals may contribute to costs through lack of compliance requiring ongoing monitoring and enforcement. | Operating Expenditure User Charges: 50-60% Various fees and charges associated with this activity. Rates: 40-50% 50% UAGC Capital Expenditure Borrowing: Loan costs are funded in the same way as operating expenditure. |
Recreation and Leisure
Art Gallery
| Service Provided | Community Wellbeing Outcomes | Who benefits/creates need? | Funding (operating and capital expenditure) |
|---|---|---|---|
This activity provides and maintains the Aigantighe Art Gallery and collection, including exhibits, research and education | Enhanced Lifestyle Connected Communities | Community-wide Benefit: The whole community benefits from access to the Aigantighe Art Gallery and a location to exhibit, store and restore art works and to enable the public consumption of art. Private Benefit: Users of the Aigantighe Art Gallery benefit for their use of the facility. Note: Council considers that allocating costs only to the users of this facility would not be practical, would deter use, and would not meet community wellbeing outcomes. | Operating Expenditure Rates: 90-100% 60% UAGC User Charges: 0-10% User charges and donations
Capital Expenditure Borrowing: Loan costs are funded in the same way as operating expenditure. Bequests: Bequests and donations also fund the purchase of some art pieces and may be used to support other capital works. Grants: Council may seek grant funding and sponsorship to support capital works. |
Fishing Huts
| Service Provided | Community Wellbeing Outcomes | Who benefits/creates need? | Funding (operating and capital expenditure) |
|---|---|---|---|
| This activity manages two fishing hut sites; Rangitata Huts and Stratheona Huts. | Enhanced Lifestyle | Private Benefit: The owners of the huts on these sites benefit from this activity. | Operating Expenditure User Charges: 100% Lease income Capital Expenditure Borrowing: Loan costs are funded in the same way as operating expenditure. |
Forestry
| Service Provided | Community Wellbeing Outcomes | Who benefits/creates need? | Funding (operating and capital expenditure) |
|---|---|---|---|
| This activity manages Council’s forestry portfolio. | Diverse Economy Sustainable Environment | Community-wide Benefit: The whole community benefits from the income generated from the harvest of the trees and the carbon credits provided. | Operating Expenditure Proceeds from asset sales: 100% Harvest of trees User Charges: 100% Lease income for forestry blocks Capital Expenditure Borrowing: Loan costs are funded in the same way as operating expenditure. |
Halls and Community Centres
| Service Provided | Community Wellbeing Outcomes | Who benefits/creates need? | Funding (operating and capital expenditure) |
|---|---|---|---|
| This activity manages and maintains community halls and centres, including Southern Trust Event Centre. | Enhanced Lifestyle Connected Citizens | Community-wide Benefit: The whole community benefits from the provision of halls and community centres for recreation, events and civil defence. Private Benefit: The users of the halls and community centres accrue benefits. Note: Council considers that allocating costs only to the users of these facilities would not be practical, would deter use, and would not meet community wellbeing outcomes. | Operating Expenditure Rates: 80-90% 60% UAGC User Charges: 10-20% Hire fees for the facilities Lease and sponsorship income Capital Expenditure Borrowing: Loan costs are funded in the same way as operating expenditure. Grants: Council may seek grant funding, fundraising and sponsorship to support capital works. |
Libraries
| Service Provided | Community Wellbeing Outcomes | Who benefits/creates need? | Funding (operating and capital expenditure) |
|---|---|---|---|
| This activity provides and maintains three district libraries including library books, resources and other services. | Enhanced Lifestyle Connected Citizens | Community-wide Benefit: The whole community benefits from the access to the district libraries through access to information, community resources and a hub for social interaction. Private Benefit: Users of the library accrue benefits. Note: Council considers that allocating costs only to the users of these facilities would not be practical, would deter use, and would not meet community wellbeing outcomes. | Operating Expenditure Rates: 90-100% 60% UAGC User Charges: Charges for some services and fines. Capital Expenditure Borrowing: Loan costs are funded in the same way as operating expenditure. Bequests: Bequests and donations also fund the purchase of some library resources. Grants: Council may seek grant funding, fundraising and sponsorship to support capital works. |
Motor Camps
| Service Provided | Community Wellbeing Outcomes | Who benefits/creates need? | Funding (operating and capital expenditure) |
|---|---|---|---|
| This activity provides five motor camps across the district. Four of these camps are leased under management arrangements. | Diverse Economy Enhanced Lifestyle | Private Benefit: The individuals who lease the motor camps and those who visit the motor camps accrue benefits from this activity. Community-wide Benefit: The community as a whole benefits through the provision of these facilities for visitors to the district and wider economic benefits. | Operating Expenditure User Charges: 90-100% Lease income and camping fees Rate: 0-10% 60% UAGC Capital Expenditure Borrowing: Loan costs are funded in the same way as operating expenditure. |
Museum
| Service Provided | Community Wellbeing Outcomes | Who benefits/creates need? | Funding (operating and capital expenditure) |
|---|---|---|---|
| This activity provides for management of the South Canterbury Museum facility and services, including displays, archives and educational services. | Enhanced Lifestyle Connected Citizens | Community-wide Benefit: The whole community benefits from the access to the South Canterbury Museum through cultural enrichment, education and preservation of district heritage. Private Benefit: Users of the museum and its services accrue benefits. Note: Council considers that allocating costs only to the users of this facility would not be practical, would deter use, and would not meet community wellbeing outcomes. | Operating Expenditure Rates: 90-100% 60% UAGC User Charges: 0-10% User charges and donations Capital Expenditure Borrowing: Loan costs are funded in the same way as operating expenditure. Bequests: Bequests and donations also fund the purchase of some museum resources and some operating expenses. Grants: Council may seek grant funding, fundraising and sponsorship to support capital works and some operating expenses (e.g. Learning Outside The Classroom (LEOTC) |
Parks
| Service Provided | Community Wellbeing Outcomes | Who benefits/creates need? | Funding (operating and capital expenditure) |
|---|---|---|---|
| This activity provides and maintains parks, reserves, sports grounds, gardens and off-road tracks across the district. | Enhanced Lifestyle Sustainable Environment Connected Citizens | Community-wide Benefit: The whole community benefits from provision and access to parks facilities across the district such as for active and passive recreational pursuits, health, education and wellbeing. Facilities contribute to community pride and perception of the district. Private Benefit: Individuals and groups that use the parks and sports facilities accrue benefits, some from specific facilities (e.g. skateparks, sportsgrounds). Note: Council considers that allocating costs only to the users of these facilities would not be practical, would deter use, and would not meet community wellbeing outcomes. | Operating Expenditure Rates: 90-100% 60% UAGC User Charges: 0-10% Sport ground leases and user charges Capital Expenditure Borrowing: Loan costs are funded in the same way as operating expenditure. Lump Sum Contributions: Some capital contributions paid for facilities (eg sports surfaces) by user groups. Financial Contributions: Council charges financial contributions for the acquisition and development of recreation and open space under the provisions of the District Plan. This funding source may be used in some instances to fund qualifying capital expenditure. Grants: Council may seek grant funding, fundraising and sponsorship to support capital works. |
Swimming Pools
| Service Provided | Community Wellbeing Outcomes | Who benefits/creates need? | Funding (operating and capital expenditure) |
|---|---|---|---|
This activity provides, maintains and manages four swimming pools across the district, including the gym and café facilities at CBay Aquatic Centre. | Enhanced Lifestyle Connected Citizens | Community-wide Benefit: The whole community benefits from the provision of swimming pools in the district. Private Benefit: Users of the swimming pool and gym facilities accrue benefits from this activity. Note: Council considers that allocating costs only to the users of these facilities would not be practical, would deter use, and would not meet community wellbeing outcomes. | Operating Expenditure – Rural Summer Pools Rates: 70-80% 60% UAGC
User Charges: 20-30% Pool user fees, hire fees and other user fees
Operating Expenditure – CBay Rates: 40-50% 60% UAGC
User Charges: 50-60% Pool and gym fees and membership, hire fees, café sales and other revenue, and other user fees. Capital Expenditure Borrowing: Loan costs are funded in the same way as operating expenditure. Grants: Council may seek grant funding, fundraising and sponsorship to support capital works. |
Theatre Royal
| Service Provided | Community Wellbeing Outcomes | Who benefits/creates need? | Funding (operating and capital expenditure) |
|---|---|---|---|
| This activity provides and manages the Theatre Royal. | Enhanced Lifestyle Connected Citizens | Community-wide Benefit: The whole community benefits from the provision of the Theatre Royal. Private Benefit: Users who either hire the Theatre Royal for events and performances, or those who attend events and performances accrue benefits. Note: Council considers that allocating costs only to the users of these facilities would not be practical, would deter use, and would not meet community wellbeing outcomes. | Operating Expenditure Rates: 80-100% 60% UAGC User Charges: 0-20% Facility hire fees (Note: Currently the facility is closed, with no revenue being generated. The existing policy will be reviewed for when the new facility is opened). Capital Expenditure Borrowing: Loan costs are funded in the same way as operating expenditure. Grants: Council may seek grant funding, fundraising and sponsorship to support capital works. |
Roading and Footpaths
| Service Provided | Community Wellbeing Outcomes | Who benefits/creates need? | Funding (operating and capital expenditure) |
|---|---|---|---|
| This activity provides and maintains the road and footpath network across the district, including bridges and street lighting. | Resilient Infrastructure Diverse Economy | Community-wide Benefit: The whole community and visitors benefit from access to the roading and footpath network. Group Benefit: Group benefit is provided to residents where footpaths and street lighting and decorative lighting is available. | Operating Expenditure – Subsidised works Rates: 40-50% 70% General Rate Subsidies: 50-60% Waka Kotahi (NZ Transport Agency) Financial Assistance
Operating Expenditure – Non-subsidised works Rates: 80-90% 60% General Rate
Capital Expenditure Borrowing: Council may decide to loan fund specific projects on a case by case basis. Projects will be assessed based on the expected life of the asset and the impact on rates. Loan costs are funded in the same way as operating expenditure. Waka Kotahi Funding: Council receives funding from Waka Kotahi for qualifying capital projects. The level of funding depends on the annual “financial assistance rate” for TDC and on the work programme approval by Waka Kotahi. Private Contributions: Council may agree to undertake specified work in addition to its planned work programme at the request of a resident if there is a private contribution. |
Cycleways and Walkways
| Service Provided | Community Wellbeing Outcomes | Who benefits/creates need? | Funding (operating and capital expenditure) |
|---|---|---|---|
| This activity provides and maintains on- and off-road cycleways and walkways throughout the district. | Enhanced Lifestyle Resilient Infrastructure Sustainable Environment | Community-wide Benefit: The whole community benefits from the provision of walkways and cycleways for recreational and commuting purposes. Private Benefit: Users of the walkways and cycleways accrue benefits. Note: Council considers that allocating costs only to the users of these facilities would not be practical, would deter use, and would not meet community wellbeing outcomes. | Operating Expenditure Rates: 90-100% 50% UAGC Subsidies: 0-10% Waka Kotahi provide some financial assistance for active transport routes Capital Expenditure Borrowing: Loan costs are funded in the same way as operating expenditure. Financial contributions: Council charges financial contributions for the acquisition and development of recreation and open space under the provisions of the District Plan. This funding source may be used in some instances to fund qualifying capital expenditure. Waka Kotahi Funding: Council receives funding from Waka Kotahi for qualifying capital projects. The level of funding depends on the annual “financial assistance rate” for TDC and on the work programme approval by Waka Kotahi. Grants: Council may seek grant funding, fundraising and sponsorship to support capital works. |
Parking Services
| Service Provided | Community Wellbeing Outcomes | Who benefits/creates need? | Funding (operating and capital expenditure) |
|---|---|---|---|
This activity develops parking facilities across the district and includes the enforcement of Council’s parking bylaw and policy. | Resilient Infrastructure Diverse Economy Enhanced Lifestyle | Private Benefit: Vehicle users visiting or working in CBDs across the district benefit from the provision of parking. Group Benefit: District businesses located within CBD areas benefit through the existence of a service that facilitates business custom | Operational Expenditure User Charges: 100% Parking income from fees and infringements Capital Expenditure Borrowing: Loan costs are funded in the same way as operating expenditure. User Charges: Parking income from fees and infringements |
Sewer
| Service Provided | Community Wellbeing Outcomes | Who benefits/creates need? | Funding (operating and capital expenditure) |
|---|---|---|---|
This activity provides for sewer services including the treatment and disposal of sewerage in the urban areas of Timaru, Temuka, Geraldine and Pleasant Point, and Timaru’s industrial wastewater. | Resilient Infrastructure Sustainable Environment | Group Benefit: Group benefit is provided to residents, businesses and industries able to connect to Council’s sewer network and tradewaste scheme and dispose of wastewater. Community-wide Benefit: There is community benefit provided through the health, economic and environmental benefits of having treated sewerage and industrial waste disposed of safely. Exacerbator: Additional costs may be caused through overloading of systems, disposal of hazardous material, illegal connections or incorrect disposal. Costs will be recovered if possible or prosecutions may be taken. Due to benefits being primarily to a group of users, it is appropriate to fund the activity via separate mechanisms. Note: Council does not consider it equitable to fund the community-wide benefit across the district, as residents not able to receive this service must provide their own sewerage collection and disposal. | Operational Expenditure Targeted Rates: 70-80% Targeted rate for all connected to the sewer services. User Charges: 20-30% Trade waste charges and other sewer charges Capital Expenditure Borrowing: Loan costs are funded in the same way as operating expenditure. Financial Contributions: Amounts to be funded from financial contributions for sewer services will be determined from Council decisions at the time of development. Lump Sum Contributions: Council may seek lump sum contributions from residents at the time of development. |
Stormwater
| Service Provided | Community Wellbeing Outcomes | Who benefits/creates need? | Funding (operating and capital expenditure) |
|---|---|---|---|
This activity provides and maintains the stormwater network including treatment and disposal management of stormwater in the urban areas of Timaru, Temuka, Geraldine and Pleasant Point, and some smaller rural schemes. | Resilient Infrastructure Sustainable Environment | Group Benefit: Group benefit is provided to the residents and businesses in areas where stormwater facilities are provided and reduce risk from flooding for residents’ properties and communities. Community-wide Benefit: Community-wide benefit accrues through protection of assets such as roads and public facilities, and by enabling safe transit for residents within urban areas during rainfall events. There is also community-wide benefit through improved environmental outcomes in stormwater treatment. Exacerbator: Additional costs may be caused through illegal connections and incorrect disposal of wastewater. Costs will be recovered if possible or prosecutions may be taken. Due to benefits being primarily community specific, it is appropriate to fund the activity separately by community. | Operational Expenditure Targeted Rate: 100% 100% Community Works and Services Rate Capital Expenditure Borrowing: Loan costs funded as for operational expenditure. Financial Contributions: Amounts to be funded from financial contributions sewer services will be determined from Council decisions at the time of development. Lump Sum Contributions: Council may seek lump sum contributions from residents at the time of development. |
Waste Minimisation
Waste Collection
| Service Provided | Community Wellbeing Outcomes | Who benefits/creates need? | Funding (operating and capital expenditure) |
|---|---|---|---|
This activity provides for the kerbside collection of green waste, rubbish and recycling to urban and some rural residents and businesses. | Sustainable Environment Enhanced Lifestyle | Group Benefit: Group benefit is provided to owners of properties receiving kerbside collection. Community –wide Benefit: The whole community benefits from a system that enables waste separation, reduces illegal or incorrect disposal and encourages improved environmental outcomes. Exacerbator: Additional costs may be caused through incorrect or illegal disposal. Costs will be recovered where it is economically viable. Due to benefits being primarily to a group of users, it is appropriate to fund the activity via separate mechanisms. | Operational Expenditure Targeted Rate: 100% Targeted rate for collection service, additional bins are charged for as a targeted differential (by service type) collection charge Capital Expenditure Borrowing: Loan costs funded as for operational expenditure. |
Waste Management
| Service Provided | Community Wellbeing Outcomes | Who benefits/creates need? | Funding (operating and capital expenditure) |
|---|---|---|---|
This activity provides for the provision and management of the Redruth Resource Recovery Park and the Geraldine, Pleasant Point, Temuka and Timaru transfer station facilities, waste minimisation education and monitoring, and closed landfill remediation and monitoring. | Resilient Infrastructure Sustainable Environment | Private Benefit: Benefit is accrued by individuals who use the Resource Recovery Park and transfer stations to dispose of household and business waste, green waste and recycling. Community-wide Benefit: The whole community benefits from education and monitoring, a system in place to enable safe and efficient waste management, public health and improved environmental outcomes. Exacerbator: Additional costs may be caused through incorrect or illegal disposal. Costs will be recovered where it is economically viable. | Operating Expenditure User Charges: 60-100% Resource Recovery Park and transfer station charges. Rates: 0-40% 100% General Rate
Capital Expenditure Borrowing: Loan costs funded as for operational expenditure. |
Water Supply
| Service Provided | Community Wellbeing Outcomes | Who benefits/creates need? | Funding (operating and capital expenditure) |
|---|---|---|---|
This activity provides for safe and effective abstraction of water from the source, and the treatment, storage and distribution of water to urban and rural residents and businesses. | Resilient Infrastructure Enhanced Lifestyle Diverse Economy | Group Benefit: Group and Private benefit is provided to all those residents able to connect to Council’s drinking water networks. Community-wide Benefit: The whole community benefits through safe drinking water being provided in areas of the district that are serviced, maintenance of public health and availability of water for key public services (e.g. firefighting) and amenities (e.g. swimming pools). Exacerbator: Additional costs may be caused through illegal connections. Costs will be recovered if possible or prosecutions may be taken. Due to benefits being primarily to a group of users, it is appropriate to fund the activity via separate mechanisms. Note: Council does not consider it equitable to fund the community-wide benefit across the district, as residents not able to receive this service must provide their own drinking water source. | Operating Expenditure Targeted Rate: 70-80% Urban and rural scheme targeted rates for urban schemes and rural scheme targeted rates. User Charges: 20-30% Charges for water supplied to properties with water meters (per cubic meter) and a small rental contribution Capital Expenditure Borrowing: Loan costs funded as for operational expenditure. Financial Contributions: Amounts to be funded from financial contributions sewer services will be determined from Council decisions at the time of development. Lump Sum Contributions: Council may seek lump sum contributions from residents at the time of development. |
Adopted by Council 2 June 2021
Last updated: 03 Aug 2021