Council to decide on setting up water CCO
Queenstown Lakes households may face higher water charges for the next nine years if the district council agrees to establish a new council-controlled organisation to deal with Three Waters.
However, council property and infrastructure general manager Tony Avery said, based on modelling, the proposed water services council-controlled organisation (WSCCO) would lead in the long term to "lower charges on average" for the 10 years from 2034.
At a full council meeting in Arrowtown on Thursday, elected members will be asked to agree to consult on the proposal to establish the WSCCO. If they agree, consultation would begin on Monday.
Mr Avery said as part of central government's Local Water Done Well Plan, to address New Zealand's water infrastructure challenges, the council had carefully assessed options for the future delivery of water services.
The other shortlisted option evaluated was for the council to continue to deliver water services in-house, which would be subject to the Commerce Commission's regulatory requirements.
Mr Avery said the council needed to be confident the model chosen would be capable of delivering financially sustainable water services to meet the increased financial requirements in legislation intended to be passed by central government.
"Under all scenarios, including council's current long-term plan, water charges are projected to increase substantially."
If agreed, the WSCCO would manage and deliver drinking water, wastewater and stormwater services in the district, and own the council's current water assets and their associated debt and liabilities.
The proposed organisation would operate independently from the council.
The Local Water Done Well reforms are underpinned by the Local Government (Water Services) Bill, expected to come into force later this year, which will require councils to transition to a separation of water charges from their general rates.
At a workshop early this month, council strategy and reform manager Pennie Pearce told councillors the internal assessment found the district's households would face slightly cheaper annual Three Waters charges for the first 10 years under the in-house model, but those costs were projected to be lower under a CCO after that.
— APL
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