Local Govt | National News Video | Parliament Headlines | Politics Headlines | Search

 


NZ Transport Agency Lowers Ruapehu’s Road Subsidy

NZ Transport Agency Lowers Ruapehu’s Road Subsidy

Maintaining and developing Ruapehu’s local road network will be a lot more challenging following a probable reduction in its Funding Assistance Rate (FAR) by the NZ Transport Authority’s (NZTA).

The NZTA has been undertaking a comprehensive review of their FAR model that determines the subsidy level councils receive on any particular type of road works has been the cause of widespread concern amongst many rural territorial authorities.

Ruapehu District Council (RDC) Chief Executive, Peter Till, said that RDC had urged the NZTA to take into account value in terms of the export driven Gross Domestic Production (GDP) produced by rural communities when making road investment decisions.

“Ruapehu currently district accounts for $321 million* in primary value for forestry, meat and dairy alone excluding any value added processing or tourism returns with only 0.03% of NZ’s population *(BERL economic data),” he said.

“The key to Ruapehu making an even bigger contribution to the NZ economy is in opening up the productive potential of our primary producers, forestry and tourism sectors which are all dependent on having access to an efficient and effective road network.”

“The NZTA seems to have rejected this thinking which is especially difficult to reconcile given that the Government’s own Policy Statement states that ‘Economic growth and productivity is the primary objective for land transport expenditure’.”

Mr Till said that the new FAR model works on one subsidy level being applicable across all a council’s roading activities including maintenance, operations, renewals, emergency works and Special Purpose Roads.

“NZTA has set the new base rate for Ruapehu at 63% for the coming 2014/15 down from a current overall effective base FAR of 66%.”

“The 63% FAR is a ‘starting point’ and going forward RDC will be engaged in discussions with the NZTA to settle a final FAR rate that will be transitioned in over the next nine years,” he said.

“Other major changes impact on funding for Emergency Works and Special Purpose Roads such as the Mt Ruapehu access roads to Whakapapa and Turoa ski fields.

“These were both significant points in RDC’s submission to the FAR Review consultation.”

Mr Till noted that setting the Emergency Works subsidy at the same level as the normal roadwork subsidy and not giving any consideration to a district’s unique geology, topography or weather is a substantive departure from the historic FAR regime that recognised different road networks in different parts of the country have different underlying costs.

“The funding formula for Emergency Works will see Ruapehu ratepayers funding around the first $900,000 of any emergency works at our base rate before being able to take advantage of a higher subsidy rate equal to our base rate plus 20%.”

“The higher ‘base rate plus 20%’ subsidy for emergency works is only applicable to an ‘out of the ordinary short duration event’ that is unusual, or of unusually large magnitude or severity,” he said.

“Ruapehu had been enjoying up to 91% subsidy on Emergency Works.”

“The new lower FAR subsidy could mean that situations such as large slips on remote rural roads may remain unworked on for some time.”

Mr Till added that another significant impact is around Special Purpose Roads where the FAR subsidy for maintenance will drop from 100% to our ordinary FAR level (63%).

“On current expenditure on the Ohakune Mountain Road this would cost Ruapehu ratepayers around an extra $200,000 per annum,” he said.

“Other concerns are around bridge subsidies which will be prioritised and lower minor (road) improvement subsidy rates.”

“With Ruapehu bridges being a long way down the NZTA priority list major bridge repairs may not happen unless ratepayers pay more.”

“The dropping of minor (road) improvement subsidy rates means this work is also less likely to occur.”

“While RDC still has to have discussions with NZTA on some issues the substantive framework of the new FAR model has been set.”

“Ruapehu ratepayers now need to carefully consider the implications and how to best apply the available resources we have going forward.”

“The types of actions RDC and communities may have to consider include; rate rises, closing roads or giving them to farmers to maintain, unsealing of roads, lesser renewal work and have more bridges with weight restrictions.”

“Council will be shortly starting consultation for next year’s Long Term Plan (LTP) 2015/25 with community focus groups.”

“We would encourage ratepayers and other stakeholders to utilise these meetings and the LTP consultation process to discuss these issues with Council.” ends

© Scoop Media

 
 
 
 
 
Parliament Headlines | Politics Headlines | Regional Headlines

 

Ruataniwha: DOC, Hawke's Bay Council Developer Take Supreme Court Appeal

The Department of Conservation and Hawke's Bay Regional Investment Company (HBRIC) are appealing to the Supreme Court over a conservation land swap which the Court of Appeal halted. More>>

ALSO:

With NZ's Marama Davidson: Women’s Flotilla Leaves Sicily – Heading For Gaza

Women representing 13 countries spanning five continents began their journey yesterday on Zaytouna-Oliva to the shores of Gaza, which has been under blockade since 2007. On board are a Nobel Peace Laureate, three parliamentarians, a decorated US diplomat, journalists, an Olympic athlete, and a physician. A list of the women with their background can be found here. More>>

Gordon Campbell: On The Key Style Of Crisis Management

At Monday’s post Cabinet press conference Key was in his finest wide- eyed “Problem? What problem?” mode. No, there wasn’t really a problem that top MPI officials had been at odds with each other over the meaning of the fisheries policy and how that policy should be pursued... More>>

ALSO:

Mt Roskill: Greens Will Not Stand In Likely Post-Goff By-Election

“The Green Party’s priority is changing the Government in 2017, and as part of that we’ve decided that we won’t stand a candidate in the probable Mt Roskill by-election... This decision shows the Memorandum of Understanding between Labour and the Green Party is working." More>>

ALSO:

Wellington: Predator Free Capital Plan

Wellington City Council (WCC), the Greater Wellington Regional Council (GWRC) and NEXT Foundation, today announced a joint collaboration to make Wellington the first Predator Free capital city in the world. More>>

ALSO:

Gordon Campbell: On Judith Collins’ Efforts At Self Correction

Thousands of prisoners currently in prison may be entitled to an earlier release than expected – and compensation – because Corrections has incorrectly calculated their term of imprisonment. Unless of course, the government buries its mistakes by changing the law and retro-actively getting itself off the hook… More>>

ALSO:

More Justice & Corrections

Sector Opposes Bill: Local Government Bill Timeframe Extended

The Minister of Local Government Peseta Sam Lotu-Iiga has asked the Select Committee to extend the report back date for the Local Government Act 2002 Amendment Bill (No 2). More>>

ALSO:

Get More From Scoop

 

LATEST HEADLINES

 
 
 
 
 
 
 
 
 
Regional
Search Scoop  
 
 
Powered by Vodafone
NZ independent news