Engineering Services Committee Agenda – 07 July 2016

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Note: The reports contained within this agenda are for consideration and should not be construed as Council policy

Notice is given that an ordinary meeting of the Engineering Services Committee will be held on:

Date:

Time:

Meeting Room:

Venue:

Thursday 7 July 2016 9.30am

Tasman Council Chamber 189 Queen Street

Richmond

Engineering Services Committee AGENDA

MEMBERSHIP

Chairperson Cr T E Norriss Deputy Chairperson Cr B F Dowler

Members Mayor R G Kempthorne Cr M L Bouillir

Cr J L Edgar Cr T B King

Cr Z S Mirfin Cr B W Ensor

Cr M J Higgins Cr M J Greening

Cr P L Canton Cr J L Inglis

Cr P F Sangster Cr S G Bryant

(Quorum 7 members)

Contact Telephone: 03 543 8524 Email: [email protected] Website: www.tasman.govt.nz

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Tasman District Council Engineering Services Committee Agenda – 07 July 2016

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AGENDA

1 OPENING, WELCOME

2 APOLOGIES AND LEAVE OF ABSENCE Recommendation

That apologies be accepted.

3 PUBLIC FORUM

4 DECLARATIONS OF INTEREST 5 LATE ITEMS

6 CONFIRMATION OF MINUTES

That the minutes of the Engineering Services Committee meeting held on Thursday, 26 May 2016, be confirmed as a true and correct record of the meeting.

7 REPORTS OF COMMITTEE Nil

8 PRESENTATIONS Nil

9 REPORTS

9.1 Long Plain Road Back Block Road Maintenance - Supplementary Report ... 5

9.2 Long Plain Road - Back Block Road Maintenance ... 11

9.3 Chairman's Report ... 27

9.4 Road Maintenance Collaboration with Nelson City Council - Business Case ... 29

9.5 Solid waste - Amendment to Capital Budgets ... 53

9.6 Public Water Supply Bylaw ... 63

9.7 Engineering Services Activity Update ... 99

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Item 9. 1

9 REPORTS

9.1 LONG PLAIN ROAD BACK BLOCK ROAD MAINTENANCE - SUPPLEMENTARY REPORT

Information Only - No Decision Required Report To: Engineering Services Committee

Meeting Date: 7 July 2016

Report Author: Gary Clark, Transportation Manager Report Number: RESC16-07-01

1 Summary

1.1 At the Engineering Services Committee meeting on 26 May 2016 staff presented a report (RESC16-05-07) seeking approval to address long standing maintenance issues for Long Plain Road in Golden Bay. The report was a result of a meeting with landowners, a Ward Councillor and the Chair of the Golden Bay Community Board.

1.2 There was some debate about the issues within the report and some clarification was requested regarding the status of the road maintenance agreements with landowners.

1.3 The report was left on the table until this meeting so more information could be gathered.

1.4 This supplementary report provides the further information requested.

2 Draft Resolution

That the Engineering Services Committee receives the Long Plain Road Back Block Road Maintenance - Supplementary Report

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Item 9. 1

3 Purpose of the Report

3.1 The purpose of this report is to provide further information as requested by the Committee following the Engineering Services Committee meeting on 26 May 2016.

3.2 The further information relates to agreements made with landowners when the road was legalised in the mid-1990s.

4 Background and Discussion

4.1 This report provides additional information arising from questions from the committee relating to the landowner agreements around road maintenance on Long Plain Road. Clarification was sought regarding the current agreements, their status and their legal effect.

4.2 The information provided in the report to the Engineering Services Committee meeting on 26 May 2016 is still relevant and correct. Verbal information provided at the meeting was also correct.

4.3 Staff have examined various files to gather any additional information that might help the Committee to form a decision. Clarification was also sought from the Council’s legal advisors regarding the status of the agreements with landowners.

4.4 The files have confirmed the information provided to the 26 May 2016 meeting was correct.

Further information below provides some historical context to way the original agreement was formed.

4.5 Around 1992 an issue around the location of the road formation and its relationship to the actual legal road surfaced as a result of some issues between two landowners. From the information available, it would appear the main catalyst for the Council to get involved related to the grazing of stock on road reserve.

4.6 At that time the Council and the affected landowners agreed to resurvey the legal road to align with the actual formation that residents used.

4.7 An agreement was drawn up setting out terms relating to:

 the formation of the existing track and who was to pay for the work; and

 the obligations of the parties to ongoing maintenance of the extension of Long Plain Road.

4.8 In summary, the length of Long Plain Road from the Council maintained road through to the northern boundary of CT117/202 (shown by a star on the plan) is covered by the agreement with landowners. A survey plan showing the different sections of the road has been provided in Attachment 1.

4.9 The different sections are described in the landowner agreement and form the basis of which landowner and council were expected to do what.

4.10 It should be noted that the last section of Long Plain Road from CT117/202 for around 400 metres to the west (the end of the formation) is not covered by the maintenance agreement.

4.11 Also of note is a subdivision that was granted in 18 September 2002 for this last 400 metre section of Long Plain Road. The conditions of consent required the upgrading of the last 400 metre section of road to a maintainable standard that was less than the Engineering

Standards. It also only treated the last 400 metres of Long Plain Road.

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Item 9. 1

5 Landowner Agreement

5.1 The landowner agreement divides Long Plain Road into two sections which have different requirements for the different land owners and council. The land owner agreement came about as a result of the formed road not following the legal road and what appears to be a dispute with neighbours about the fencing of cattle.

5.2 The Council became involved in an attempt to sort the issue out and the landowner agreement was drawn up to carefully set the obligations of all parties. The Council’s

obligations were to construct the new formation (paid for by landowners), legalise the newly formed road, and grade Road Sections 1 and 2 once a year. The landowners were

responsible for all other maintenance over and above the grading.

5.3 Section 2 of the agreement required two landowners to pay for the upgrade of the road to a standard that can be maintained. The road formation was to a lesser than normally accepted Council standard in terms of width.

5.4 Section 3 sets out the use and maintenance obligations for the extension of Long Plain Road.

The agreement identifies two separate sections (Road Section 1 and Road Section 2).

5.5 Road Section 1 was to be maintained by the first two landowners with some contribution required from a third landowner should their use of the road change “from occasional to more full time”.

5.6 All three landowners were obliged to contribute to the maintenance of Road Section 2 based on usage.

5.7 Of note there was a clause that stated “Should there be a dispute on the condition of (Road) Section 2 for any reason such as lack of adequate maintenance of the road then Council as owner of the road will act as arbitrator and decide on an appropriate remedy.”

5.8 Staff have obtained advice regarding the ongoing status of the agreement from the Council’s legal advisers, Fletcher Vautier Moore. They have confirmed that the information provided at the 26 May 2016 Engineering Services Committee meeting is correct. The landowner

agreement only binds the landowners who signed the agreement. No subsequent landowner can be forced to contribute to the road maintenance.

5.9 Only one landowner who signed the original agreement is still a landowner on Long Plain Road. Council is also still party to the original agreement.

5.10 Also as noted above, there is a section at the end of Long Plain Road that is not covered by the landowner agreement so the landowners on this section have no requirement to maintain any part of the road.

5.11 A letter to the landowners in December 1993 explained their land Certificates of Title would include mention of the agreement. A review of the Certificates of Title have shown that this did not occur. Council was responsible for paying for and completing this process.

5.12 Lastly the process to complete the road legislation and agreements took a considerable amount of time. The December 1993 agreement required the Council to legalise the new road boundaries. The file shows some angst between neighbours was still occurring around the fencing of cattle and one of the landowners refused to sign the agreement until this matter had been dealt with. The new road boundaries were finally approved in 1998.

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Item 9. 1

5.13 Staff have no information on how much maintenance has been done to the road by

landowners since the agreement was signed. It would appear that some maintenance has occurred in the past but more recently, and especially in the last three to four years, very little work has been done on the road. The area is subject to significant water flows from the catchment above and without adequate regular maintenance the road will deteriorate very quickly.

6 Conclusion

6.1 The landowner agreement binds land owners and council to the construction of Long Plain Road and the ongoing maintenance of the newly formed road. The cost of constructing the new road and the more significant maintenance needs were the responsibility of the land owners. Council had an obligation to grade the road once a year.

6.2 In recent years it would appear none of the parties’ subject to the agreement have carried out any maintenance on the road.

6.3 It could be argued the Council had some responsibility to ensure that at least some

maintenance was done on the road. As noted in the report there was a process that enable disputes about road maintenance on Road Section 2 to be addressed. The Council was to be the attributor and would decide on the appropriate remedy.

6.4 The Council was also responsible for arranging and paying for information to go on Certificates of Title about the agreement. This did not occur.

6.5 There is one landowner and the Council as the only remaining parties to the agreement.

6.6 The conclusions are noted in the report to the Engineering Services Committee on 26 May 2016.

7 Attachments

1. Long Plain Road - Road Section Plan 9

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Att ac hm ent 1 Item 9. 1

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Item 9. 2

9.2 LONG PLAIN ROAD - BACK BLOCK ROAD MAINTENANCE

Decision Required Report To: Engineering Services Committee

Report Author: Gary Clark, Transportation Manager Report Number: RESC16-07-02

1 Summary

1.1 Tasman District Council has around 1700 kilometres of formed road that it maintains, with 900 kilometres sealed and 800 kilometres unsealed. There is also an unmeasured length of paper roads and other formed or partly formed roads and tracks.

1.2 The formed roads that are not maintained by the Council were generally constructed by third parties and typically with no formal approval from the Council. These “back block” roads have been formed by residents and others to carry out business on the land. They are typically not built to any Council-approved standard and in some cases to no standard at all.

1.3 Back block roads are often managed by the individuals that use them and generally are fit for their private needs. Some of these back block roads that have been formed by others are now becoming a problem for users. Generally, there are no agreements with Council regarding the maintenance of these roads.

1.4 The last 1.8 kilometres of Long Plain Road in Golden Bay is beyond Council’s maintained network. The back block length has an historic agreement between the landowners and the Council dating back to 1994. The agreement includes expectations and obligations on all parties.

1.5 Many of the original landowners who were parties to the agreement have moved on since 1994. This has led to a reduced level of maintenance commitment by landowners. This may be as a result of new landowners not being aware of the 1994 agreement.

1.6 The Council has not carried out any maintenance on the road for some time as the 1994 agreement requires a certain level of basic maintenance by residents before Council staff will instruct the roading contractor to do work.

1.7 The 1994 agreement creates problems in terms of the management of the road. The road now requires reinstatement work of around $80,000 to bring it up to a reasonable

maintenance standard.

1.8 This report seeks to address the problems stemming from the original agreement. This will require an engagement process with the current landowners to agree to a cost-sharing arrangement to repair the road and then for the road to be included in the road maintenance contract.

1.9 There is a separate report in the agenda relating the concerns around unsealed road maintenance and mowing on district roads.

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Item 9. 2

2 Draft Resolution

That the Engineering Services Committee

1. receives the Long Plain Road - Back Block Road Maintenance report; and

2. approves the funding of road repair works for the last 1.8 kilometres of Long Plain Road up to $80,000; and

3. agrees for staff to engage with the current landowners of the last 1.8 kilometres of Long Plain Road; and

4. agrees that landowners should contribute 20% of the total cost of road repair works to bring the last 1.8 kilometres of Long Plain Road up to a maintainable standard.

5. agrees that on completion of the road repair works that the Council will take over the future maintenance of this road and extend its road maintenance contract to include this 1.8km section of Long Plain Road.

6. notes that issues around the extent of the maintained road network and the

maintenance of the infrastructure within road reserve will be considered as part of the 2018 Long Term Plan process.

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3 Purpose of the Report

3.1 The purpose of this report is to provide information on back block roads and the particular issue around Long Plain Road in Golden Bay. This report will be followed up with a second report focusing on the extent of landowner maintained roads in the district and the

challenges these present to Council in the future. This report will be provided as part of the Long Term Plan process in 2018-2028.

4 Background and Discussion General

4.1 The Council has a number of roads that fall outside what has been determined as its maintained network. Prior to 2012 there was a small annual budget of approximately

$10,000 to deal will some of the issues that arose with these roads. However, in reality the maintenance of these back block roads is generally undertaken by the local residents that use them.

4.2 The concerns around the levels of maintenance for unsealed roads and mowing are reported on separately at this meeting. The issues around the extent of the maintained road network and the level of maintenance on the maintained road network are different topics.

4.3 In general, back block roads have very low traffic volumes and in most cases only provide access to a few landowners. They are in effect, driveways that happen to be on road

reserve. They have been typically constructed and formed to a much lower standard than the Council would normally build its roads. In most, if not all, cases they have been constructed without Council approval. Some are historic routes and others have been developed by landowners for a particular activity such as forestry.

4.4 In most cases, issues around these roads are largely dealt with by adjoining landowners or users.

4.5 In the Long Term Plan 2012-2022 the back block road budget was removed as there was very little call on the funds. It was also considered that the issue on these roads and associated risks was best left with the parties that had formed the road.

4.6 Recently there have been a number of requests to address maintenance on some of the roads in the District. This has raised several issues including:

 Who pays for repairs to bring roads to a suitable standard so the road can be maintained? and

 Who pays for the maintenance to be carried out? and

 It would appear that some roads have a loose agreement about who will do what from the different parties; and

 Increased use of some of roads by non-locals to access other areas such as Department of Conservation land.

4.7 As noted, there are some existing quirks relating to arrangements with some landowners for the maintenance and renewals of these roads. Most roads have no agreement in place and no maintenance is done by the Council. They are not included in the maintenance contract and are considered to be beyond the road network the Council maintains.

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Item 9. 2

4.8 At the other extreme, some of the roads like Cobb Valley Dam Road have a multi-party agreement with third parties and with no financial contribution from the Council. We do however manage the works on these roads. Totaranui Road is much the same with 100% of the funding currently from the New Zealand Transport Agency while the Council manages the road maintenance.

4.9 In between these ends of the spectrum is the odd agreement to do a certain amount of works but not everything. Graham Valley Road is an example where a third party provides funding for a certain level of maintenance but other works are excluded. Other agreements have included the construction of bridges that have been partly funded by landowners.

Long Plain Road – Golden Bay

4.10 There is an unusual agreement in place to manage maintenance issues on the last 1.8 kilometres of Long Plain Road. In general, the agreement is that the Council will grade the road provided the landowners undertake regular maintenance of the drainage surfaces and other assets to ensure the road is in good condition. This section of Long Plain Road, which serves four properties, is not fully maintained by the Council but instead has an agreement of sorts from 1994 (Attachment 1).

4.11 Long Plain Road is currently maintained by the Council for a length of approximately 6.6km from its start at State Highway 60.

4.12 The last 1.8km section of Long Plain Road is not maintained by the Council. It is in a poor, but traversable condition. It has not been graded for over 12 months as there is an

inadequate amount of gravel to grade. The recent weather events have further affected the road to the point that it is now only suitable for four-wheel-drive vehicles. The residents have not undertaken any significant maintenance on the road for a number of years. Any water tables that may have originally been formed have been lost and water flows down the road in any rain event.

4.13 A certain section of the 1.8km road length has seen the maintenance gravel and some of the subgrade washed away leaving the original ground/subgrade exposed. The original ground surface has very little load bearing capacity and is not suitable for regular traffic. The drainage systems to remove water from the road formation are nonexistent which is one reason why the recent weather events have damaged the road structure.

4.14 The photographs show the general condition of the road from the end of the Council- maintained section to its end. The bottom is generally in reasonable condition as shown in photo 1. The next two photos show the areas with the greatest maintenance issues. The last photo shows the end section which received an upgrade following a subdivision and is in good condition even though the water tables need some work.

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4.15 This section of Long Plain Road can generally be described as “beyond maintainable” and, to ensure it remains operational, it would need to be reconstructed.

4.16 The 1994 agreement states that any maintenance required over and above a once-per-year grade is to be arranged by the landowners at their own cost. This agreement was made with the landowners at the time, and is not actually linked to the property titles.

4.17 Subsequently, only one of the original landowners on the agreement remains. Further to this, there has been at least one subdivision and several new residences constructed in the last 22 years. These changes have resulted in increasing traffic volumes on this section of road.

The road is in a geographic area that is prone to high intensity rainfall and frequent flooding.

4.18 This type of road maintenance agreement has a number of risks and would not be an approach that staff would now recommend to the Council. The reason is that there will be different expectations of Council staff and landowners to what constitutes good condition, land ownership changes, which is what has happened on Long Plain Road and the timing of maintenance would be different for all parties.

4.19 This type of arrangement will likely lead to a situation where all parties find the answer unworkable. For Long Plain Road this has happened. There are new landowners who may have no knowledge of the agreement and were under the expectation that the Council maintained the road.

4.20 Unfortunately, the road maintenance agreement was filed on the road files and not the property files.

4.21 Staff believe that this type of agreement resulted in setting up all parties for future difficulties, with the responsibility for maintenance now largely being unaddressed.

5 Options General

5.1 If the 1.8km section of road is bought up to a maintainable standard at an estimated cost of

$80,000, then the Council could take over the future maintenance of the road and in effect extend its road network to include this section of Long Plain Road.

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Item 9. 2

5.2 To reconstruct the section of road to the Council’s Engineering Standards is estimated at more than double the above amount and is probably unnecessary given the level of

expected use. The extra risk here is mostly related to drainage as the flooding is sometimes intense.

Option 1 – Do nothing

5.3 Even with the complication of the 1994 agreement, the Council has no immediate obligation to maintain this section of road until it is bought up to a minimum level by landowners.

5.4 The landowners may choose to repair the road to a standard of their own choosing. If the residents choose to not repair the road, then its condition is likely to continue to worsen. This may lead to a point where the Council is obliged to close the road if it is deemed to be

unsafe for users. This would force the landowners into providing some maintenance to gain vehicle access to their properties, or else forgo vehicle access.

5.5 This option results in no additional repair costs or future maintenance costs for the Council, but the landowners and community are likely to continue to push for a different answer which will result in more staff time responding to complaints.

5.6 There is also the issue around the Council allowing a subdivision without the road being suitably upgraded at that time and it being passed to the Council to maintain. The agreement seems to have been a halfway house for dealing with the larger issue around access and expectations.

5.7 Do nothing is not an acceptable option as the documentation around expectations has not stood the test of time and has exposed all parties to difficulties in determining how to identify and meet their obligations.

Option 2 – Approach landowners to pay for repairs

5.8 The existing landowners could be approached to pay for repairs to a standard acceptable to the Council and then the Council would take over future maintenance. This would ensure the quality of the repairs and secure this section of Long Plain Road for better maintenance levels in the future.

5.9 If the landowners agree to pay for the repairs, then no precedent is set for the Council to upgrade other back block roads in the District.

5.10 The Council would take over the future maintenance of this road and extend its road maintenance contract to include this 1.8km section of Long Plain Road.

Option 3 – Repair the road at Council’s cost.

5.11 The Council could approve extra funding to repair the road and take over responsibility for future maintenance. This option results in considerable expense for the Council, but would undoubtedly satisfy the landowners and community.

5.12 The issue with this option is where to draw the line. If the Council agrees to accept

responsibility for this extra section of road, then why not other back block roads which are similar? This will be the subject of a separate report as part of the 2018 Long Term Plan process which will consider all roads in the district.

5.13 As noted above, there is an agreement in place that suggests that there is some ownership of maintenance by Council but also residents which implies joint responsibility.

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Item 9. 2

5.14 The estimated cost to form an unsealed pavement, reconstruct water tables, and upgrade culverts to a minimum maintainable standard (but below the Council’s Engineering Standard) is $80,000.

Option 4

5.15 This option is a hybrid with a shared-cost arrangement between the landowners and the Council. The actual cost-share would need to be determined following discussion with landowners.

5.16 This will be a difficult matter to resolve as certain parts of the road are generally sound in terms of maintenance with others in need of significant work. The landowners on the bottom sections of the road will be less likely to want to fund works on parts of the road they don’t use. There are only three landowners that need to use the worst section of the road.

5.17 It should be noted that requests around maintenance of the road have only been raised recently. It would appear that the road has been deteriorating for several years which raises the question why this issue was not bought to the Council’s attention sooner when the costs to address the problem would have possibly been cheaper. Equally, but to a lesser degree it could be argued why didn’t the Council raise the maintenance issues with the landowners earlier. The Council’s contractor does not routinely inspect the condition of back block roads.

5.18 As noted above, the expected cost to get the road to a maintainable standard would be around $80,000.

5.19 The cost sharing of this work could be set at any level. Usually the cost sharing

arrangements are between 20% and 50%. Staff consider 20% to be an appropriate minimum level which makes it affordable for residents while still recognising that there was an

agreement in place. This would equate to around $4000 per land owner.

5.20 Upon successful completion of road repair works the Council would take over the future maintenance of this road and extend its road maintenance contract to include this 1.8km section of Long Plain Road.

Consideration of Options

5.21 There is an historic agreement in place for landowners and the Council to maintain this section of Long Plain Road. This agreement was with original landowners who have since moved on with new landowners not aware of the agreement. This has led to poor

maintenance on the road for several years. This has been exacerbated by the recent weather events.

5.22 The do nothing option is not acceptable. It would lead to the Council closing the road

because of safety issues. This would be unacceptable to landowners who may have had no idea what they are responsible for in terms of maintaining the road. Their expectations when they purchased the property may be that the Council was responsible for road maintenance.

5.23 This leaves the remaining options where the road is bought up to a maintainable standard by the landowners, by the Council or through a cost-sharing arrangement.

5.24 Staff are unclear of the Council’s view on this issue. Guidance is sought as to how much the Council would fund to resolve the issues for landowners at the top end of Long Plain Road.

5.25 Option 4 is recommended and if adopted it is suggested that staff discuss funding options with landowners and develop a cost-sharing arrangement to bring the road up to a

maintainable standard with the Council then taking over the future maintenance of the road.

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6 Strategy and Risks

6.1 There have been ongoing requests for the Council to carry out maintenance on a number of sections of legal road reserve beyond the normally maintained sections. These requests generally take up a disproportionate amount of staff time and the situations are an issue for the affected community and landowners.

6.2 There are a number of back block roads that are not maintained by the Council. Some members of the public are now wanting these roads maintained which will increase the length of maintained road network, and increase road maintenance budgets. This would also lead to more funding being required to bring these roads up to a standard for ongoing

maintenance.

6.3 The costs for upgrading these roads will be significant. For example, two roads that residents have recently requested upgrades for are Anatoki Track and Tasman View Road. The costs to upgrade these roads to a maintainable standard are estimated to be around $400,000 and

$800,000 respectively. These are capital improvements and would also result in an increase for the road network maintenance budget.

6.4 Once the Council decides to maintain some of these roads it could be expected new

requests would be received to maintain other roads, or road features. This may lead to other maintenance issues that the Council does not include in its work such as land drains.

6.5 Understanding the extent of the issue needs to be considered as part of the Long Term Plan 2018-2028 process. This will allow staff time to investigate and understand the best

response for the future.

6.6 There is also a need to review roading policies around road maintenance. This may allow a transition of some of the maintenance issues through a shared process with landowners.

7 Policy / Legal Requirements / Plan

7.1 As noted above, there is a 1994 agreement between the Council and the original landowners for the maintenance of the upper section of Long Plain Road. While the agreement is clear on who does what, the fact that the landowners who were party to the agreement are largely not living there now creates complications in terms of responsibility.

7.2 While legally the Council does not have to maintain all roads in the District, it must ensure that any road open to the public is safe. If it is not safe, the Council can close the road for public use. The Council is not responsible for providing vehicle access to individual properties. Every landowner in a new subdivision should be able to construct physical vehicle access to their property. It is important to note that it is not the Council’s

responsibility to provide or construct that access. However, as the landowner the Council has the right of approval and can determine the scope and standard of works carried out.

7.3 Any agreements between the Council and landowners relating to road maintenance should be included on the relevant property files. This will deal with some of the past issues relating to changes in land ownership.

7.4 Future issues around the ownership of road maintenance should be dealt with at time of subdivision. There will be some road maintenance issues that will need to be managed on a case-by-case basis.

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7.5 The Long Term Plan 2018-2028 process will consider the road maintenance issues raised in this report. This work will include matters around the extent of our road network and also the issues about what is maintained in the road corridor. Levels of service and the road

standards that the Council might accept in back block areas will also be considered.

7.6 Roading policies will also be reviewed.

7.7 Any roads constructed to a lesser standard than specified in the Tasman Resource Management Plan would require resource consent.

8 Consideration of Financial or Budgetary Implications

8.1 The recommendations in this report will have a funding implication on the roading budgets.

8.2 Depending on the direction of the Committee, the funding implication could be as high as

$80,000 depending on the level of cost-sharing obtained from residents.

9 Significance and Engagement

9.1 The decision to spend funds on bringing the level of Long Plain Road to a maintainable standard is considered of low significance to the public. This is because the impact is directly related to the landowners who use the road.

9.2 However, the decision is of medium significance to the wider community as other

landowners with similar roading issues such as those on Anatoki Track will want their road upgraded. There is an agreement with the original landowners of Long Plain Road and the Council regarding the maintenance of Long Plain Road. There may be other roads with similar agreements that staff are not aware of and which may require consideration on a case-by-case basis.

9.3 The cost of up to $80,000 to resolve the Long Plain road maintenance issue is relatively small. Any issues around road maintenance on other roads without agreements with the landowners will be addressed as part of the Long Term Plan 2018-2028 process. This will include engagement and consultation with all parties. It should be noted that costs

associated with a fundamental change in the scope of road network maintenance may be significant and are best dealt with as part of the Long Term Plan process.

9.4 Following guidance from the Committee, staff will engage with landowners to develop a plan to upgrade Long Plain Road to a maintainable level. The level of contribution from the landowners will need to be considered as part of that process.

10 Conclusion

10.1 There are a number of roads in the District that the Council does not maintain for a variety of reasons. These are typically because the Council did not construct or form the road and they are largely historic. The issues around these matters will be considered more fully as part of the Long Term Plan 2018-2028 process.

10.2 The Long Plain Road maintenance issues are complicated by a 1994 agreement between the original landowners and the Council. The agreement has requirements for all parties but practically is now difficult to enforce or administer.

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10.3 The section of Long Plain Road has now deteriorated to a level where around $80,000 is needed to bring it up to a maintainable level. Guidance is sought from the Engineering Services Committee to the level of funding the Council should provide to address the maintenance issues and for the affected section of road to be included in the Council’s road maintenance contract.

10.4 Some contribution could be sought from the landowners on the affected section of Long Plain Road.

11 Next Steps / Timeline

11.1 If cost-share funding is approved, then staff will hold discussions with the affected landowners regarding their contribution to the maintenance cost.

11.2 If an agreement can be reached, then work to rectify the maintenance issues on Long Plain Road will occur before December 2016.

11.3 There will be further reports and workshops around the bigger issue of the extent of the maintained road network in terms of length and the infrastructure within the road reserve as part of the Long Term Plan 2018-2028 process.

12 Attachments

1. Landowner Agreement 23

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Att ac hm ent 1 Item 9. 2

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Att ac hm ent 1 Item 9. 2

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Att ac hm ent 1 Item 9. 2

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Att ac hm ent 1 Item 9. 2

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Item 9. 3

9.3 CHAIRMAN'S REPORT

Information Only - No Decision Required Report To: Engineering Services Committee

Report Author: Trevor Norriss, Chairman, Engineering Services Report Number: RESC16-05-03

1 Summary

1.1 This is the Chairman’s regular report to the Engineering Services Committee.

2 Draft Resolution

That the Engineering Services Committee receives the Chairman’s Report.

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Item 9. 3

3 Welcome and Update 3.1 Welcome to today’s meeting.

3.2 The recent and continuing heavy rain events have put pressure on staff resources, Councillors and some of the ageing infrastructure itself. Our contractors have done an amazing job of repairing the damage but unfortunately most of our pipework is not designed to cope with these major events especially in some of our coastal communities when they coincide with high tides. Trying times for everyone.

3.3 Dwayne Fletcher and I recently attended a South Island Regional Transport forum seeking a collaborative approach from the South Island regional transport committees and Councils. It was an excellent day with the opportunity to discuss issues and the benefits of working together for a united voice for the South Island. A report supporting ongoing collaboration will be presented to the Tasman Regional Transport Committee on 4 July 2016 and then to this meeting seeking your support.

3.4 The Joint Land Development Manual is at the stage where an information day for the development community will be held on 6 July 2016. This will be an opportunity for staff to identify where we proposed to change the current standards and why. I will provide a verbal update at our meeting.

3.5 I would like to congratulate Jamie McPherson, our Road Asset Coordinator for his work with the national Road Efficiency Group (REG). This group is a collaborative initiative by the roading sector throughout New Zealand and includes all of the road controlling authorities. It aims to drive value for money and improving performance in the maintenance, operations and renewals of the transport network in New Zealand. Jamie has been closely involved with the group and has recently been commended by the Chairman for his time and energy for the cause.

3.6 Many of our staff make valuable contributions to national advisory groups such as REG and I applaud their commitment which gives a positive profile for our Council. Well done and thank you Jamie.

3.7 Best wishes to Miriam Hoy, our Administration Officer in the Utilities group who is leaving us for bigger and better things. Thanks Miri for your cheerful contribution to the Department during the last three years and best wishes in your new role.

3.8 I have kept this report short as it appears political aspirants are interpreting many of these reports into something they are not.

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9.4 ROAD MAINTENANCE COLLABORATION WITH NELSON CITY COUNCIL - BUSINESS CASE

Decision Required Report To: Engineering Services Committee

Report Author: Jamie McPherson, Road Asset Coordinator Report Number: RESC16-07-04

1 Summary

1.1 Staff were asked to prepare a business case for collaboration with Nelson City Council on urban road maintenance.

1.2 The business case has been completed and is included in this report as Attachment 1.

1.3 A range of options for collaboration were identified, investigated and assessed to describe their respective benefits, dis-benefits, costs and risks.

1.4 The preferred option is Option 2. This option is considered low risk and low cost with moderate benefits.

1.5 Option 2 involves a combined procurement strategy and shared procurement process for road maintenance services in Tasman and Nelson. Each council will have its own standalone contracts which will be managed independently, but contract specifications and form will be aligned and tenderers will have the opportunity to submit conditional tenders for multiple contracts. This presents the opportunity for the market to identify and deliver efficiencies in regional delivery of road maintenance and could lead to future collaboration.

1.6 Both councils’ current maintenance contracts end in July 2017.

1.7 Nelson City Council approved the plan to collaborate with Tasman District Council for collaboration on road maintenance as per Option 2 recommended in this report.

2 Draft Resolution

That the Engineering Services Committee:

1. receives the Road Maintenance Collaboration with Nelson City Council - Business Case report; and

2. approves Option 2 as the preferred option for collaboration in road maintenance with Nelson City Council.

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3 Purpose of the Report

3.1 This report summarises the business case prepared for road maintenance collaboration with Nelson City Council. The report has been prepared in accordance with the resolution at the Engineering Services Committee meeting on 17 December 2015.

3.2 The recommendations seek the Engineering Services Committee’s approval for Tasman District Council to collaborate with Nelson City Council on future road maintenance contracts.

4 Background and Discussion

4.1 A report to the Engineering Services Committee on 17 December 2015 (RESC15-12-02) includes background and discussion relevant to why the business case for road maintenance collaboration has been investigated.

4.2 To summarise, both Tasman District and Nelson City Council staff considered there were possible opportunities and benefits in collaborating on urban road maintenance which were worth investigating in more detail by preparing a business case.

4.3 Attachment 1 to this report is the business case which has been prepared jointly by Tasman and Nelson staff.

4.4 The business case process has different stages, broadly outlined as follows:

 Strategic Case – outlines the problem/opportunity statement(s), benefits, context, stakeholders, and strategic response options.

 Indicative/Detailed Case – explores the options in greater detail including benefits, dis- benefits, costs and risks.

4.5 The strategic business case identified six options. Of these, four were taken forward to detailed case. The two options that weren’t considered in detail were establishment of a CCO and amalgamation of the two councils. Urban road maintenance activity within the Nelson-Tasman region is not a large enough activity to consider these a reasonable response.

4.6 The four options included in the Detailed Case are summarised in Section 5, with detail provided in Attachment 1.

4.7 Staff conducted an analysis of the two councils existing contract schedules to identify specific opportunities for improvements in value for money. This was difficult due to the difference in the two schedules and how work is specified and paid for in each area. Only 20% of the total value of works had directly comparable rates. It was also clear that tenderers make different assessments and pricing decisions across schedule items.

Therefore, financial benefits are largely dependent on the supplier market and tender process.

4.8 At their Works and Infrastructure meeting on 23 June 2016, Nelson City Council approved to progress to Option 2 provided that Tasman District Council follows the same path. A copy of the Nelson City Council report has been provided in Attachment 2.

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5 Options

5.1 Option 1 – Status quo. Considered low risk, low cost but no additional benefits.

5.2 Option 2 – combined procurement strategy (shared procurement). Low risk, low cost, with potential for moderate benefits. This is the preferred option, and unlocks many of the potential benefits of collaboration without disrupting the current contract management and governance structures of urban road maintenance which are considered to be performing well.

5.3 Option 3 – service level agreements. Considered high risk, uncertain cost, with moderate benefits.

5.4 Option 4 – joint principals contract(s). The Council has an existing joint principals contract with the New Zealand Transport Agency for the Golden Bay local roads so this model is reasonably well known in Tasman. This option is considered a moderate risk with uncertain costs and moderate benefits.

6 Strategy and Risks

6.1 Risks of each option are described in more detail in the business case.

6.2 The preferred Option 2 offers a low risk opportunity to undertake an effective collaboration with Nelson City Council with demonstrable benefits to the delivery of road maintenance in the region.

6.3 Aligning road maintenance contract documents between Tasman and Nelson and providing tenderers with an opportunity to demonstrate efficiencies in maintenance across the region, will provide short term and long term benefits to both councils. There is also the potential for this to lead to greater collaboration in the future as our understanding of the risks develops.

6.4 Even by taking part in this collaboration, the Council is not obligated to accept any tender if it feels there is undue risk or disadvantage associated.

6.5 A similar collaboration has recently been established in South Canterbury involving four councils – Timaru, Ashburton, Waimate and McKenzie districts. Staff have engaged with representatives of this collaboration to learn from their experience.

6.6 One example from the South Canterbury collaboration was the lowest ‘regional’ tender price resulted in a significant cost saving for one district and a cost increase for another. In this case, there was an agreed transfer payment from the benefitting council to the other council.

Overall, this was still the best result for the region.

7 Policy / Legal Requirements / Plan

7.1 Collaboration with neighbouring councils is also a key theme in the 2015-2025 Long Term Plan.

7.2 The Council’s Procurement Strategy identifies collaboration with our neighbouring authorities including Nelson City Council and the New Zealand Transport Agency and the potential advantages that would arise. This report is consistent with the objectives of the Procurement Strategy.

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Item 9. 4

7.3 The Transportation Activity Management Plan and Long Term Plan 2015-25 have no reference to collaboration with Nelson City Council on an urban roading maintenance contract.

7.4 Section 17A (S17A) of the Local Government Act (LGA) encourages councils to seek greater effectiveness and efficiencies in service delivery through exploring a set number of options for the governance, funding, and delivery of infrastructure, services and regulatory functions.

This part of the LGA encourages councils to explore opportunities and identify where there may be benefits in changing the way we deliver services.

7.5 While this business case for collaboration was not specifically prepared in order to meet the requirements of S17A, it is consistent with the objectives and will form part of the Council’s overall response to S17A.

8 Consideration of Financial or Budgetary Implications

8.1 The preferred Option 2 will have some cost in terms of staff time in developing aligned maintenance contract documentation and additional tender evaluation time. However, these costs are considered minor when balanced against the benefits of efficiencies and

knowledge sharing.

8.2 These costs can be met within existing budgets.

9 Significance and Engagement

9.1 This collaboration is considered to be of low significance as described in the following table.

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Issue Level of

Significance Explanation of Assessment Is there a high level of public

interest, or is decision likely to be controversial?

Low

This is expected to low due to the current timing of the reports to date. This become more significant as staff carry out more investigations and conclusions have some impact.

Is there a significant impact arising from duration of the effects from the decision?

N/A Does the decision relate to a

strategic asset? (refer

Significance and Engagement Policy for list of strategic assets)

Moderate

The Council’s road network is a strategic asset. However, this is very much at the planning stage does not trigger any changes to the asset management at this point in time. It will again become more significant as the final approach has been worked through.

Does the decision create a substantial change in the level of service provided by Council?

N/A Does the proposal, activity or

decision substantially affect debt, rates or Council finances in any one year or more of the LTP?

N/A

Does the decision involve the sale of a substantial

proportion or controlling interest in a CCO or CCTO?

N/A

Does the proposal or decision involve entry into a private sector partnership or contract to carry out the deliver on any Council group of activities?

N/A

Does the proposal or decision involve Council exiting from or entering into a group of

activities?

N/A

10 Conclusion

10.1 The business case for road maintenance collaboration with Nelson City Council has identified Option 2 as the preferred option. This option is considered low risk and low cost with moderate benefits.

10.2 Option 2 involves a combined procurement strategy and shared procurement process for road maintenance services in Tasman and Nelson. Each council will have its own stand-

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Item 9. 4

alone contracts which will be managed independently, but contract specifications and form will be aligned and tenderers will have the opportunity to submit conditional tenders for multiple contracts. This presents the opportunity for the market to identify and deliver efficiencies in regional delivery of road maintenance.

11 Next Steps / Timeline

11.1 New road maintenance contracts will have a start date of 1 July 2017. Tender documentation including aligned contract specifications will be prepared and advertised by November 2016 so that evaluation and award can take place in January 2017. This provides a good lead-in time for the successful tenderer to establish.

12 Attachments

1. Maintenance Collaboration - Business Case 35

2. Nelson City Council report regarding road maintenance collaboration 23 June 2016 47

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Att ac hm ent 1 Item 9. 4

Activity Area: Urban Road Maintenance

Prepared by: Rhys Palmer, Senior Asset Engineer - Transport and Roading, Nelson City Council and Jamie McPherson, Transportation Network Engineer, Tasman District Council

Reviewed by: Peter Anderson, Manager Operations and Asset Management, Nelson City Council and Gary Clark, Transportation Manager, Tasman District Council

Last update: 9 June 2016

Purpose: To explore the benefits of collaboration between Nelson City Council and Tasman District Council for Urban Road Maintenance.

Funding available: Budget and years of funding allocated in Annual Plan/ LTP

STRATEGIC CASE

PROBLEM / OPPORTUNITY SUMMARY Problem/ Opportunity Statement(s) Background/ evidence:

1. No problems have been identified. Collaboration is being considered as an opportunity to explore possible savings and share knowledge rather than solve specific problems.

2. Evidence of sub-optimal outcomes and opportunities for improved outcomes:

a. Tasman District needed to establish an urban maintenance contract for urban level of service to be provided reliably, but ran into difficulty getting

reasonable price because their urban areas were not large enough.

b. Tasman has a larger resealing programme per year than Nelson and so over time combined contracts could lead to savings (reduced unit cost) for Nelson.

c. Nelson has a larger paving resurfacing (AC) area than Tasman and there is an increasing likelihood of more paving required in Tasman as a result of urban growth. Tasman therefore could benefit from savings (reduced unit cost) generated by combined contracts for paving/resurfacing.

d. There are examples of some lower cost solutions for activities in one road controlling authority (RCA) compared to another (footpath rehab being procured separate from the maintenance contract and undertaken by smaller contractors with lower cost structures was raised as an example).

3. There is little benefit in collaborating with Marlborough due the topographical separation

4. There is no current opportunity to collaborate with the NZTA highways maintenance as they have recently entered into a long term maintenance contract.

Problem/ Opportunity Statement(s):

1. Aligning specifications and schedules makes it simpler for the market to provide consistent services and pricing across RCA boundaries.

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Att ac hm ent 1 Item 9. 4

Problem/ Opportunity Statement(s)

2. Combining activities across RCA boundaries could lead to improved contractor staff efficiencies, for example a reduced number of supervisors needed resulting in reduced unit costs.

3. Alignment of tender programmes could help reduce the cost and maximise competitive response by the market

4. There may be better buying power for urban maintenance contracts when spread across both Nelson and Tasman rather than individually.

5. Greater collaboration will make it easier to deliver consistent one network road classification (ONRC) levels of service between neighbouring Councils

6. Economy of scale could lead to a wider number of opportunities for different procurement strategies leading to reduced costs for both Councils over time 7. Improved collaboration will give more credibility to consideration of wider regional

strategic solutions such as ‘Top of the South Roads’

8. Improved knowledge sharing across Council roading teams

9. Benchmarking performance across both networks; more ability to ‘like-for-like’

comparisons

10. Larger contracts may result in bigger contractors, newer and better plant, equipment at a lower cost and retention of skilled people in the region

Photos/ Plans NA

BENEFITS SUMMARY

Benefit Rank

(H/M/L)

Measure

Consistency of customer experience

across the two districts (ONRC) L

Consistent performance against ONRC measures across Tasman District and Nelson City

Economy of scale and buying power M Financial savings Right sized procurement packaging and

realising more options and opportunities H Improved contract performance and reduced cost to the market

STRATEGIC CONTEXT

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Strategy/ Policy/ Service Level Definition

Contribution

S17A Local Government Act review the cost effectiveness of current arrangements for providing local infrastructure, services and

regulatory functions at regular intervals

Roading Efficiency Group (REG) collaboration

“Provide for benchmarking and information to support

“smart buying”. Allow for local procurement if appropriate/cost effective. Provide a foundation for possible joint procurement.”

(ref. REG “Collaboration: Working with each other to achieve shared goals”,

https://www.nzta.govt.nz/assets/Road-Efficiency- Group-2/docs/collaboration.pdf )

STAKEHOLDERS

Stakeholder Interest Consulted?

Operations Operating and maintaining Councils roading

infrastructure asset in a cost effective manner Yes

Parks and Facilities

NCC Roading include maintenance of many Parks and Facilities hard surfaces under the urban Maintenance Contract

Yes

Council Yes via 2 x

reports

NZTA External funder Yes

Contracting industry Size, form and scope of contracts to be offered to market

Yes – Fulton Hogan (TDC) and Downer (NCC) only as

incumbents.

Contracts extended to June 2017

RELATED PROJECTS/ STRATEGIES/ ACTIVITIES Project (ID) or Operational Activity

Definition Implications

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Project (ID) or Operational Activity

Definition Implications

STRATEGIC RESPONSE OPTIONS Options

1. Develop aligned tender timing only, with each Council doing their own thing with no collaboration focused on improving existing contracts and procurement methods

2. The Councils develop a combined procurement strategy that realises additional benefits, such as using the same contract form and specifications and aligning tender timing

3. The Councils enter into service level agreements for different services. For example, Nelson engages a Contractor to do reseals for the region, Nelson manages the contract and Tasman

‘buys’ the services off Nelson

4. The Councils enter into a shared services arrangement whereby there are ‘joint principals’

contracts and the management effort is shared relative to the respective Council capabilities 5. The Councils create an entity (Council Controlled Organisation) to manage the road network,

such as Marlborough Roads; this could also include State Highways

KEY ASSUMPTIONS Assumption

Urban road maintenance is not sufficiently significant an activity to consider establishment of a CCO (option 5), and the benefits would not in themselves justify considering

amalgamation (option 6) as a solution, therefore these two options will not be considered any further in the Indicative Business Case

Tasman District and Nelson City will work together openly sharing information on existing urban maintenance contracts and associated road maintenance activities in their respective jurisdictions to enable comparison of costs on a like for like basis. This analysis will enable them both to develop an understanding of the financial benefits that can be gained by implementing the various options.

Urban Maintenance Scope boundaries – All of Nelson and Richmond

Other activities e.g. reseals street sweeping, road marking could be across all areas Option 1 is the baseline ‘do nothing’ option.

STRATEGIC CASE ASSESSMENT

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Recommendation Options:

1. Continue on to complete the Indicative Business Case – include rationale for this and time and $ estimates for completion

2. Do nothing – no further work required, accept the problem Approval

Name: Alec Louverdis

Date: May 2016

Reference Material

Document Tardis ref

Notes from workshop, dated 11 March 2016, attended by Nelson City and Tasman District Council staff independently facilitated by MWH

Indicative Case

DECISION CRITERIA

Indicator Definition Weight

Staff Cost Cost to administer

maintenance contracts and any associated governance

activities

20

Service Cost Cost to provide

service/contract based on 80%

of total expenditure ($)

60

Improved contract performance 20

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Option Business Option 1 - do nothing different

– Status Quo Business Option 2 – Combined

Procurement Strategy (Shared Procurement)

Business Option 3 – Service Level

Agreement for different services Business Option 4 – Joint Principals Contracts

Detail Develop aligned tender timing only with each Council doing their own thing and no collaboration focused on improving existing contracts and procurement methods.

Develop a combined procurement strategy that realises benefits, such as using the same contract form and specifications and aligning tender timing. Separate RFTs as standalone documents. Tenderers can provide conditional tenders for multiple contracts. Tenderers can choose to tender for either or both contracts with rates conditional on whether they are awarded one or both of the contracts.

The Councils enter into service level agreements for different services. For example, Tasman engages a Contractor to do reseals for the region, Tasman manages the contract and Nelson ‘buys’ the services off Tasman. Likewise, Nelson would engage a contractor to do road sweeping for the region with Nelson managing the contract and Tasman ‘buying’ the service from Nelson.

(Richmond Urban within NCC Maintenance Contract)

The Councils enter into a shared services arrangement whereby there are ‘joint principals’ contracts and the management effort is shared relative to the respective Council capabilities

Benefits  No Additional overhead cost (staff time)

 BAU comfortable flexibility at individual organisation level, both operational and governance

 Scope flexibility e.g.: can cope with differences in contract scope and or exclude elements such as reseal.

 Individual organisation retains

operational and governance flexibility –