Long-term Plan 2015 2025

Options workshop
Presentations
7 July 2014















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2015 - 2025\20140707_Options advice
workshop

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2015-2025\14 LTP Options 7 J uly
workshop

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Table of contents

A) Mayors Opening Address (Mayor Len Brown)
To be tabled
1
B) Transforming Auckland Stephen Town (CE) 5
C) Opportunities to create capacity & deliver better value Andrew McKenzie (CFO)
To be tabled
19
D) Resourcing for critical infrastructure 23
Water supply and waste water pricing and efficiencies (Brian Monk) 25
Transport strategic options (David Warburton) 35
Alternate funding (Peter Winder) 41









Mayors Opening Address
(Mayor Len Brown)
1
2

To be tabled
3


4


Transforming Auckland
Stephen Town (CE)
5
Longterm
Plan2015
2025
TransformingAuckland
Affordabilityrequiresfocusonthe
thingsthatwillmakethemost
difference
Approach
The Mayor has set the political direction
Today provides an overview of the
organisations response
The detail comes later
Seven Budget Committee workshops
Local boards and IMSB consider and provide
feedback to the Mayor
Sept 1 Come together to consider Mayoral proposal
Nov 5 - Decision-making for draft LTP
6
Delivering on our vision
This session will cover:
What were doing to deliver the Auckland Plan
What are we currently doing?
What is planned?
What else could we be doing?
The prioritisation tools that will be used to
ensure focus and affordability
TheAuckland
Planisourticket
totheglobal
competition
amongstcities
7
The Auckland Plan
Two
Geographic
Projects
Six
Transformational
Shifts
Auckland
Plan
Outcomes
Prioritisation
This LTP needs to align our 10 year budget and our 30
year vision in the Auckland Plan
Ensuring affordability means we cant afford to do
everything now
Lower rates increases will require a significant overall cost
reduction
Our prioritisation tools are:
1. Six Transformational Shifts
2. Two Geographic Priorities
3. Ten Spatial Priorities
8
Prioritisation other things considered
LTP scene setting workshop
Draft Local Board Plans released today
Aspirations for local communities
Public transport and
quality urban living
seen as the key drivers
of transformation
Transformational Shifts
The six Transformational Shifts
describe the change required to
achieve our vision
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Move to outstanding public transport
within one network
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What we do now to deliver this shift
Rail system carries over 11 million trips per year
Bus network carries 53 million trips per year
Integrated ticketing
What is currently planned
Enhance and extend Rapid Transit Network
City Rail Link
57 electric trains
Improve bus and ferry network
Improve access to quality PT
Enable and support growth close to PT
Radically improve the quality of urban living
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What we currently do
Plan and implement enabling housing (HPO), PAUP, open space,
recreation and facilities network
Influence and design buildings and public spaces
Deliver and operate Community and recreational facilities
Encourage healthy lifestyles parks, facilities, walking/cycling
Transport, water, wastewater, stormwater
What else we could do
Further enhance Aucklands Waterfront
Focus on spatial priorities
Embed Te Aranga Maori Design Principles
Seismic Stabilisation Fund for Privately Owned Heritage Homes
10
Significantly lift Mori social and
economic wellbeing
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What we currently do
Events
Marae redevelopment and housing initiatives
Identification and protection of sites significant to
Maori
Co-management of parks and reserves
What else we could do
Te Whai Painga - Mori social well-being
Te Whai Tiaki Mori cultural well-being
Te Whai Rawa Mori economic well-being
Treaty settlements
Mori effectiveness
Substantially raise the living standards for all Aucklanders
and focus on those most in need
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What we currently do
Knowledge, literacy, skills and competencies
Support economic growth at regional and local levels
Investment in events, innovations hubs and tourism infrastructure
Enable healthy, dry and warm homes
Community-based social development initiatives
What else we could do
Auckland Investment Office
Business, Attraction and Employment Growth Fund
Business Growth and Competitiveness
Transforming Aucklands Visitor Economy
Regional Innovation Hubs
Digital Auckland
11
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Dramatically accelerate the prospects of Aucklands
children and young people
What we currently do and have planned
I am Auckland Implement action plan
Playgrounds and play spaces
Youth development and civic participation
Youth facilities and community programmes
Youth grants and scholarships
Youth connections
What else we could do
Expand Youth connections across Auckland
More Aucklanders, More Active, More Often
Auckland Skills and Employment Hub
Strategic Regional Grants Programme (all shifts)
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Strongly commit to environmental action and
green growth
What we currently do or have planned
Waste minimisation and resource recovery
Rural fencing and planting
Monitoring, research and investigations
Maintain and optimise storm water network
Plant / animal pest control
Central interceptor
Investment in public transport
What else we could do
Waste Minimisation
Low Carbon Auckland
Healthy Waterways
12
Discussion/questions?
Geographic Projects
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The Southern Initiative
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What we currently do
Deliver, coordinate, facilitate, partner
What is currently planned
A cadetship programme between employers and MIT
Working with central government and NGOs to improve
numeracy and literacy in South Auckland
Support social and affordable housing projects
What else we could do
An integrated TSI Work Programme
City Centre
The City Centre
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What we currently do
Shared spaces
Parks and open spaces
Roading, cycling and pedestrian infrastructure
What is currently planned
Planning, design and construction of new shared spaces
Major street transformations - Quay Street, Victoria Street
Wynyard Quarter
Investment in PT infrastructure
Drive residential and commercial investment
14
Discussion/ Questions?
LTP
Spatial
Priorities
SHAs
Network
Requirements
Other
priorities
Auckland Development Strategy
identifies:
growth areas over 30 year
timeframe
network of centres
different roles and scales
rural and future urban
areas
Spatial prioritisation will enable
Council and CCOs to unlock
growth and development
opportunities
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Spatial Priorities
15
Spatial Priorities
Spatial prioritisation includes:
10 proposed spatial priority areas
Proposed future planning spatial priorities
Special Housing Areas (SHAs)
Network requirements
Other priorities
Provides lens to help prioritise and focus Council and CCO work
programme still investing across Auckland
This spatial prioritisation will inform the next phase of 2015-2025 LTP
New spatial priorities expected around every 5-10 years
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Spatial
prioritisation
Initial areas of focus
10 proposed spatial
priorities in yellow
Approved SHAs in red
Proposed future
planning spatial
priorities in green
(initial work required
to complete strategic
frameworks)
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Draft local board plans
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Emerging themes align to Transformational Shifts
Protect, enhance and restore the natural environment
A transport system that is well connected and offers a range of
options
Communities with a sense of belonging
Places and opportunities for active and healthy lifestyles
Well planned vibrant town centres
Strong local economies
For consideration through this process
Discussion/questions?
17
Feedback session 1
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Where should our focus lie in
delivering the Auckland Plan in
a financially constrained
environment?
Does our current
plan provide the
right level of
focus on each
priority area?
Of the opportunities identified for
possible investment, what do
you see as the Top 3 to make a
difference?
Are there any
gaps?
18


Opportunities to create capacity
& deliver better value
Andrew McKenzie (CFO)
19
20

To be tabled
21
22


Resourcing for critical
infrastructure
23


24
LTPOptionsandEvaluationPhase
7July2014
WatercareServicesLimited
FinancialManagement Funding
Funding
Watercareisselffunding noincomefromrates
Preventedbylawfrompayingadividend
Allrevenueisusedtofundourexistingoperationsandto
developnewinfrastructure
Primaryrevenuestreamscomprisewaterandwastewater
revenueandinfrastructuregrowthcharges(IGCs)whichcover
aportionofnewgrowthbasedcapitalexpenditure.
Watercaresrevenueandfinancingpolicyisalignedwith
AucklandCouncilguidingprinciples equity,transparency,
sustainability,efficiency
25
Growth
AucklandCouncilsgrowthforecastsunderpin
Watercaresplanning
Populationgrowthwillincreasedemandfor
potablewater
800,000people(35yearsgrowthatmedium
forecast)
200,000m
3
/dayadditionalwaterdemand
Growthcapexis42%oftotalcapitalspend
AlignmenttoAucklandCouncil
Plans
Wherepossible,Watercareisprioritising
projectstodelivertheadditionalcapacity
requiredtosupportthegrowthprojectedinthe
AucklandPlan,UnitaryPlan,SpecialHousing
Areas
26
AssetManagementPlanning
Driversofcapitalinvestment
Renewals:replacementofexistingassetsattheendof
theirlifetomaintaincurrentservicelevels
LevelsofServiceImprovement:upgradingofexisting
assets andtheprovisionofnewassetstomeethigher
servicelevels
Growth:1)upsizingofexistingassetsandthe
provisionofnewinfrastructuretoincreasecapacityto
caterforgrowth
2)SupportAucklandCouncilsplans
Infrastructureprojectsoftenaddressmultiple
drivers
CapitalExpenditure
LastAMPforecast$4.8bn20152025
LatestAMPforecasts$4.1bn
Reductionof$700million
CurrentyearAMPprojected$336million
Yearendforecast$310million
Watercareisactivelylookingforopportunitiesto
reduceexpenditure,optimisecapitalinvestment
anddeliverefficiencysavings
27
MajorCapitalProjectsOutline
EfficienciesandValue
Efficienciesrealisedtodate in2011/12
Watercarerealisedover$104minannualcost
savingsvs.previousplans
Sincethen,majorprocurementsavings
initiativesincluding:
Electricity $2mannuallyacrossparticipating
Councilorganisations
Gas $140kannually
Chemicals $750kannually
28
FinancialManagement Pricing
Pricing
Abalancebetweenfuturepriceincreasesanddebtlevelsis
requiredtofundtheAMP
Rangeofpriceincreasesmodelled
Projectedincreasesforwaterandwastewaterarecurrently
lookinglikeapprox.1%realperannum
IGCs
Fundnewgrowthcapitalexpenditure
Partiallysubsidisedbyexistingcustomers
Projectedincreasesatthisstageinlinewithwaterand
wastewater
FinancialManagement Debt
Debt
Alloptionstomitigateoveralldebtlevelsarebeing
reviewedincluding:
AMPexpenditureandtimingofexpenditure
Priceincreases
Expenditureefficiencies
Watercarestreasurystructureallowsaccesstobenefits
availabletoCouncil(lowerinterestrate)while
maintainingtheindependencethatensuresatight
focusonourfinancialobjectives,ourdebtandgearing
29
Aucklandsnextwatersource Waikato
Waikatoriveristheonlymajornextsource
Derisk ArdmoreandRedoubtRoad
Consentforadditional200,000m
3
/daywater
takelodgedwithWaikatoRegionalCouncillate
2013
Lookingtosecureadditionaltakebyend2017
ContributiontoAucklandPlan:Afair,safeand
healthyAuckland,wherepeoplevaluethe
excellentservicesandfacilities available
Whenwillitbeneeded?
Timingofthe2
nd
Waikatoplantandpipelinedependson
actualdemandvssupply
WaterDemandinfluencedbymanyfactors difficultto
forecastaccurately
Climate
Demandsavings(factoredin15%savingsto2025)
Rateofpopulationgrowth
Customerbehaviours
Supplysidevariations
Plantavailability
Lake(source)availability algalblooms
Peakcapacityaugmentation
Couldberequiredasearlyas2021
30
Timingof2
nd
WaikatoPlant&Pipeline
TimingRiskMitigationPlans
HuiaWTPReplacement
Eliminatesludgebottleneckatexistingplant
Removeaverageandpeakcapacityconstraint
BoostpumpingexistingWaikatofrom150,000to
175,000m
3
/dayunderconsideration
Requiresconsentforadditionaltake
Requiressecuringresourceconsentfortakeofwater
treatmentplantandnewpipeline
Planningandpreliminarydesignfor2
nd
Plantand
PipelineFY20152016
31
CentralInterceptorProject
ReplacementfortheHillsboroughTunnelandManukau
Siphon(Enterpriserisksassinglepointsoffailure)
ProvidescapacityforgrowthforInnerWestIsthmus,
CentralCBDandEasternsuburbs
Reducesthefrequencyandvolumeofoverflowsfrom
thecombinedseweragesystem
ContributiontoAucklandPlan AgreenAuckland,
whereourwaterwaysandcoastlinesarecleanand
fulloflife
NoadditionalriskstoManukauorWaitemataharbours
actuallyreducesrisks
SchemeTiming
Mainspinetunnelcurrentlyprogrammedto
becompletein2023
CollectorsewersconnectingCSOstomain
tunnelprogrammedtobecompletein2034
Schemetimingcouldbemodifiedtodefer
capitalexpenditure
2Stageconstruction
Stage1fromMangereWWTPtoMaysRoad(toaddress
Enterpriserisk)
Stage2fromMaysRoadtoWesternSprings
willdefercapitalbutathighertotalandNPVcost,limits
growthanddelaysenvironmentalimprovements
32
CentralInterceptor
InService2023
CentralInterceptorOption
ConstructinStages
CSOCollectorSewers
Progressivelyinservicefrom2025to2033
CentralInterceptor:Possiblealternative
staging
Stage1:MangereWTPtoMayRoad
Stage2:MayRoadtoWesternSprings
AdditionalStagingCost
Demobilisation/Remobilisation
Additionalcivilworks
33
34
AT presentation to LTP
Options / Advice Workshop
7
th
July 2014
2
Auckland Plan Transport Networks 30yr targets
Indicator Description
Target
(Auckland Plan)
AucklandPlan
TransportNetwork
Publictransportboardings
Numberofannualpublictransportboardings
(millions)
140mby2022 2026:140m
Publictransportboardings percapita
Numberofannualpublictransportboardings per
capita
100by2040 2046:102
Publictransportmorningpeakmotorised
modeshare
Proportionofmorningpeakmotorisedtrips(PT&
Auto)intotheCBDbypublictransport
70%by2040
2026:60%
2046:68%
Walking,cyclingandpublictransport
morningpeakmodeshare
Proportionofmorningpeaktripsthataremadeby
walking,cycling,orpublictransport
45%by2040
2026:28%
2046:34%
Greenhousegasemissions
Greenhousegasemissionsfromgroundbased
transport
49%reductionon
current
2046:4%inc
Strategicfreightnetworkcongestion Severecongestiononthestrategicfreightnetwork
18%AM
8%IP
by2021
2026:16%AM
2026:7%IP
2046:18%AM
2046:14%IP
The Auckland Plan Transport Network involves $16b of AT investment in new capital projects over 30 years - funded
from Auckland Council, NZTA and Central Government. In addition, AT renewals are estimated at $10b over 30 years.
The Basic Transport Network involves $8b of AT investment in new capital projects over 30 years - funded from
Auckland Council, NZTA and Central Government. In addition, AT renewals are estimated at $7.5b over 30 years.
35
3
AP & Basic Transport Networks 30yr Spend Profile
Airport Rail Line and Mt Roskill Rail Spur
Parnell Station and electrification Papakura to Pukekohe
Penlinkand funding for regional arterials (e.g. Lake Road, Great
North Road, Great South Road, Mill Road)
Walking and cycling initiatives 20% less of the cycle network
delivered by 2025
Higher amenity and customer friendly infrastructure supporting the
new integrated PT network
50% funding to remove rail level crossings
North Western Busway and other bus rapid transit improvements
60% less funding for greenfield growth areas in second and third
decades
Reduced renewal funding leads to decreased asset condition over
time and increased maintenance
AP Transport Network
Basic Transport Network
$m
$m
Example projects in the AP Transport Network
CRL completed
Half Airport Rail Line & Mt Roskill Rail Spur or equivalent
Regional arterial improvements
Walking and cycling initiatives 60% of cycle network by 2025
Customer focussed new integrated PT network completed
Funding to support removal of rail level crossings
Rollout of busways and bus rapid transit in the North West and
South East
Full delivery of transport infrastructure for greenfields
Full funding to renew transport assets (to deliver existing levels of
service)
Under Auckland Plan prioritisation, projects unlikely in
the Basic Transport Network
AC provided
envelope incl
NZTA
subsidyto AT
(Excls CRL
and EMUs)
4
Level of service 2
No assets worse than
condition grade 4
Level of service 2
No assets worse than
condition grade 4
I
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k

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y
,

p
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p
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,

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t
w
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k

p
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f
o
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a
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c
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Renewals expenditure to
maintain level of service
Increasing maintenance costs as condition deteriorates
New
Maintenance
costs $
Possible delay
Years
No delay
Bridge
Footpath
Optimising asset management / renewals
36
5
Project lifecycle new capital
Glenfield Road Corridor Upgrade
Dominion Road Corridor Upgrade
6
0
0.5
1
1.5
2
2.5
3
3.5
Auckland Plan
Transport Network
Basic
Transport Network
Renewals Active
Systems, Local Board Initiatives etc Safety
Roads PT - other
PT - EMUs PT - CRL
4yr CAPEX (2014/15 2017/18)
$b
Set as a response to Auckland
Plan transport targets
Set based
on Auckland
Council
reduced
funding
envelope
(2.5% rates)
37
7
Potential 2014/15 Impacts
Reducedspendonrenewalsbasedon$45mreduction:
30%(70km)reductioninfootpathandcycleways pa
20%(90km)reductioninroadrehabilitationand
resealingpa
30%reductioninspendonroading projects
40%reductioninspendonPTprojects(exclCRLand
EMUs)
30%reductioninspendonwalkingandcyclinginitiatives
8
Challenges - transport
Industry
- impact on the construction sector
- productivity and momentum
- programme cant be turned on and off
PT new network infrastructure and services, limited RTN
Assets - levels of service
Freight economic impact on freight and commercial vehicle movement
Congestion managing a more congested roadingnetwork
38
9
Challenges community / funders
Community - expectation management
Reduced jobs
Growth supporting projected population growth across
Auckland
Messaging to funders
39
40
AlternativeTransportFunding
Phase2
IndependentAdvisoryBody
FormerlytheConsensusBuildingGroup
Newnamereflectstheneedtoactasan
advisortocouncilwhileretaining
independenceduringtheLTPconsultation
period.
Theirroleistodeveloptwopotentialfunding
pathwaysforconsiderationbytheGoverning
Body.
41
ProjectAim
TosupporttheGoverningBodytomakea
decisioninJune2015aspartoftheadoption
ofthe20152025LongTermPlan,onhowto
respondtotherecommendationsfromthe
CBG,byundertakingfurtherworktorefinethe
choiceoffundingpathway.
Projectobjectives
Tocompletetheanalysis,evaluationand
reportingnecessarytoenabletheGoverning
Bodytomakeaninformedandrobustdecision
overwhichfundingpathwaystoincludeinthe
DraftLongTermPlaninDecember2014.
Toproviderobust,evidencebasedadvicetothe
GoverningBodyonwhichfundingpathwaysto
includeforconsultationintheDraftLongTerm
Plan,basedontheviewoftheIAB.
42
TheIAB
StewartMilne(Chairman)
GarryTaylor(EDS)
StephenSelwood(NZCID)
KimCampbell(AucklandBusinessForum)
TonyGarnier(AucklandBusinessForum)
ShaunAwatere(LandcareResearch)
DonnaWynd(ChildPovertyAction)
RobertReid(FirstUnion)
CameronPitches(CampaignforBetterTransport)
DavidAitken(NationalRoadCarriers)
PaulShortland(CycleActionAuckland)
AndySmith(WalkAuckland)
SimonLambourne(AIAL)
AucklandPlanTransportNetwork
(withnewfunding)
43
BasicTransportNetwork
(withoutnewfunding)
FundingGap Profile
44
ApproachtoLTP
Transport Network StatusQuo(low
investment)
Existing toolsfunding
pathway high
investment
Roadchargingfunding
pathway high
investment
BasicTransport
Network

Auckland Plan
TransportNetwork

Fundamentalchoices:
Twolevelsofinvestment
Twofundingpathwaysforhighinvestment
FundingPathwayOptions
1. ExistingTools:
SignificantincreaseinRates,FuelExciseandRUCplus
Tollsonnewroads(i.e.Penlink,ornewHarbourCrossing)
Usesexistingfundingmechanisms
Exploringdifferenttargetedrates
Exploringregionalvnationalfueltax
2. RoadCharging:
SingleCordon,IsthmusCordon,MotorwayNetwork
Charges
Motorwaynetworkchargeisthemostpromising
Requireslegislation
45
Investigations
RoadChargingSchemeDesign Deloitte
Stage1drawsoninternationalexperience
Stage2willdevelopanAucklandoperatingmodeland
costconstructionandoperation
ImpactonBusiness&Households Market
Economics
Targetedinterviews
Econometricmodelingtodemonstrateimpactsand
possiblemitigation
Investigations
TransportSystemModelling Council,AT
UsesCouncilsART3model
SupportedbyAT
Exploringoptionsformoredetailednetwork
models
EvaluationandEconomicAnalysis
Multicriteriaassessmentprocess
EconomicevaluationbasedonNZTAmethod
46