State Highways and growth paying for growth

By: Steve Morris

Straight from city council
A personal view,
by Councillor Steve Morris

A couple of announcements last week are arguably the most significant move by Government in Tauranga yet.

Councils’ borrowing is constrained by the Department of Internal Affairs. We can’t borrow more the 250 per cent of our city’s revenue; that’s prudent but it means we can’t finance the $2billion-plus transport deficit the city has.

With hundreds of millions needed in water, stormwater and wastewater we aren’t even close to being able to finance a quarter of what’s needed in transport.

Hopefully, there’s a healthy dollop of funding for Tauranga in the $6.8b Government has allocated to transport over the next four years. Tauranga is surrounded (or strangled) by State Highways 29, 29a and 2 which Council has no control over. Funding improvements will get our city moving and unlock new subdivisions to provide the housing our city and the country desperately needs.

The other announcement deals with how growth is financed. Traditionally, Councils go ‘banker’ for developers by putting in roads, sewage, and water plant upgrades to accommodate growth. The cost of projects such as the $140m Waiari Water Treatment Plant sit on Council’s balance sheet and are only paid back fully when the last house is built in the subdivisions they service; constraining what we can invest in other projects.

Soon, new subdivisions can have their infrastructure financed by a Government entity that’ll recover the cost via a charge on the rates of the newly created properties for 20-plus years.

No longer will these projects sit on our ratepayers’ balance sheet.

Finally, growth will pay for growth.