(Our Ref: DJLICA File No.: 0012 21 March 2017 The Hon Peter Gutwein 9" Floor Executive Building 15 Murray Street HOBART 7000 Dear Minister TasWater Ownership Thank you for agreeing to attend the next LGAT General Meeting on Friday 7 April in Launceston. As previously advised, the Local Government sector has committed to carefully considering the model of State Government ownership proposed in the Premier's State of the State address. As a sector, we are confident that TasWater can deliver the robust 10-year capital plan it has prepared and that all boiled water alerts and “do not consume” notices will be removed by August 2018. The Government's suggestion that it could deliver the same program twice as fast seems, at face value, and in the view of TasWater’s Chairman, highly risky to both the Corporation's ‘ongoing viability, and to the quality of the capital works proposed. To allow a better understanding of the impacts, both on our communities and their councils, the State Government is requested to provide to Local Government the detailed business case justifying the takeover. In particular, the current owners are seeking to understand how the: 1. Government plans to address the key risks associated with attempting to complete TasWater’s 10-year capital program by FY2021 rather than FY2026; 2. Capping of price increases between 2.75% and 3.5% can service the projected debt levels of the Corporation, while sustaining the ongoing operations and capital program (that is, we would like to see the Government's 10 year financial modelling setting out annual profit and loss, balance sheet and cashflow projections); and 3. Financial returns to owners can be sustained and improved beyond 2026. The very hostile approach taken by the Government towards Local Government has been extremely disappointing and begs the question as to why it was necessary in the light of a strong business case. Councils would like to work in partnership with the State Government to ensure that the water and sewerage systems best meet the needs of all our communities and trust that your presentation to our General Meeting will be in that spi Yours sincerely Dy Gm Doug Chipman PRESIDENT