Councils face squeezing multi-million spatial plan bill under rates cap

Selwyn's mayor is questioning how councils will afford regional spatial plans under a rates cap.

Creating a Canterbury Regional Spatial Plan is mandatory under the Government's proposed Planning Bill – one of two laws replacing the Resource Management Act, alongside the Natural Environment Bill.

The spatial plan will set a 30-year strategic framework covering urban growth, housing, transport infrastructure, and environmental protection.

Regardless of any amalgamations and new unitary authorities, the first-generation regional spatial plans must be based on the existing regional and unitary council boundaries, and it is mandatory to prepare one.

Selwyn Mayor Lydia Gliddon isn't sure how councils can put together a plan alongside local government reorganisation, and without any government funding assistance, while fitting it all under a 4% rates cap.

"We just circle right back to the conversation of unfunded mandates," Gliddon said.

"The Government keep making work for councils while telling us to focus on the core services and slapping a rates cap on top of it.

"With the potential cost involved for ratepayers and the potential of having to repeat the process within five years, it could be better to wait until the other things are sorted first.

"The frustrating part is we have to drop tools on other things we're doing to put a focus into something that is a little bit out of your control."

Creating Canterbury's regional spatial plan has been estimated to cost between $7-10 million, but could end up being more.

Canterbury Mayoral Forum's proposed funding model would have Environment Canterbury and Christchurch contribute 20.5% each, Selwyn and Waimakariri 10.7%, Ashburton and Timaru 9.8%, Hurunui 5.2%, Waimate and Waitaki 3.9%, and Kaikōura and Mackenzie 2.5%.

If the plan costs the low-end $7m, Selwyn's $750,000 contribution would equate to around 0.5% of rates.

Gliddon said the mayoral forum is in the final stages of setting up the spatial plan committee and "there'll be a process agreement coming in November".

Waimakariri Mayor Dan Gordon also called the spatial plans another example of an ''unfunded mandate'' from central Government which will ultimately fall on ratepayers.

He questioned the timing of another significant work programme being forced on Canterbury councils.

''It's a 30-year plan that will likely need to be re-done when new local government structures are established by 2028.''

Ashburton District Council's compliance and development group manager Ian Hyde said the council "are looking at a significant cost" for the spatial planning work, which is expected to be funded by debt.

"The debt servicing costs will have to fit inside any cap.

"Council will consider estimated costs and funding mechanisms as part of our long-term plan process."

Hyde doesn't expect the regional plan process to be repeated, but instead it will "help inform the replacement planning system for the RMA".

"Following local government reorganisation and the Simplifying Local Government decisions, it is likely that new unitary councils will prepare land use plans that give effect to those regional spatial plans and replace existing district plans.

"Going by that timeline, we would not expect the process to be repeated or to incur significant duplicated costs."

Ashburton has already taken steps to minimise the risk of duplicated costs by postponing its District Plan review in 2024, "recognising that successive governments had signalled significant RMA reform was on the way", Hyde said.

But it still comes at a cost to respond to legislative requirements set by Government, he said.

"Financial or other support from Government would be welcomed, as it would help reduce the burden on ratepayers."

RMA Reform Minister Chris Bishop has responded to the criticism, stating the planning is core business for councils.

''Spatial planning is intended to support better investment decisions, stronger economic growth and more efficient infrastructure delivery, while providing greater certainty about where development should occur.''

Independent analysis by Castalia estimated it would cost councils around $870 million nationwide to prepare for the new planning regime, Bishop said.

The costs would be ''more than offset over time through a simpler, faster and more efficient planning system''.

The Government was investing in national digital planning, consenting and data systems to reduce costs for councils.