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For:  KDC chief executive and elected members

PC 78

COMMUNITY PROPOSAL FOR RESOLVING WHETHER TO ACCEPT OF REJECT THE RECOMMENDATION OF THE HEARING PANEL

 Late advice to the Council

I apologise that this document will only be received 24 hours before the Council meeting of 31 March 2021.  That has arisen because the Council has only released its agenda for the meeting in the last few days. 

The Council staff appears be bent on having a definitive decision on the Panel’s recommendation from the elected members without any opportunity for the further consideration of important issues and the legal ramifications involved.

The impression given is that the Council staff is very keen to get the Panel’s recommendation adopted as soon as possible, presumably so that the allegations of misrepresentation by the Council staff do not get an airing.

Deadline for decision-making

There is no need for an immediate decision.  The Council decision on PC78 does not have to be made until 3 April 2022, as stated by Mr Waanders in his report.

However, it is acknowledged that a final decision on PC78 should be made as soon as possible.

Staff report

Paul Waanders, a KDC senior planner, has presented a report to the Council setting out two clear options for dealing with the recommendation of the Hearing Panel:  Either accept it in full, or reject it in full.

The Council is to consider and decide on one of those two options at the Council meeting on 31 March 2021

Mr Waanders has presented arguments for and against each option. 

He recommends that the Panel’s recommendation be adopted in full.

With all due respect to Mr Waanders, his summaries of the advantages and disadvantages of each option avoid any reference to the important issue of misrepresentation of the MCWWS capacity and the recent revelations in respect of the MCWWS repayment model and the impact that they may make on the Panel’s recommendation.

The role of a chief executive is to provide, through council staff, advice to the elected members on the options before them when deciding an issue.  The advice proffered by Mr Waanders is extremely narrow in its scope, and it fails to include considerations that should have been made available to the elected members.

Responses to Mr Waanders’ advantages and disadvantages are set out in the Appendix to this document.

Legal advice

It is notable that the Council has not sought any legal advice on the matter, particularly in relation to the risk that the Council runs in adopting the Panel’s recommendation without enquiring further into the misrepresentations of the Council staff, and the covering up and failure to modify the flawed repayment model.

Legal advice is not always necessary in decision-making, but where there are fundamental failures in a Council’s performance, as in this case, legal advice is absolutely essential.

If the elected members were to adopt the advice in Mr Waanders’ report, the one-sided nature of the report, the failure to provide legal advice, and the pressure to make the preferred decision as a matter of urgency, would open up the Council to legal challenge on the basis of a failure of due process and pre-determination by the Council staff.

Councillor Larsen’s Notice of Motion

The agenda for the Council meeting includes a Notice of Motion of Councillor Larsen:

Recommendation

That the Kaipara District Council:

a) Directs the Chief Executive to arrange a briefing on the Mangawhai Community Wastewater Scheme (MCWWS) capacity and debt as soon as possible and prior to Long Term Plan (LTP) hearings taking place.

b) That the briefing include clarification on the matters raised in Kaipara Concerns column dated 19 March 2021 and Mangawhai Matters column in Mangawhai Focus dated 22 March 2021 regarding the MCWWS capacity and debt (both as attached).

c) That the briefing maybe held as part of an already scheduled briefing.

The Notice of Motion was filed before the recommendation of the PC78 Panel was released.  It shows that some elected members have reservations about the misrepresentations made by Council staff in the PC78 process.  They seek clarification from the chief executive on the issue before the hearings on the LTP submissions take place.

Those misrepresentations have now become relevant to the question of whether the recommendation from the Panel be adopted or rejected because those misrepresentations affect some of the recommended changes under PC78.

In addition, the Council’s chief executive has acknowledged, in response to a LGOIMA request, that for the past 10 years the KDC has applied the wrong model to the repayment of the MCWWS historic debt.  The chief executive has stated that the Council was “advised” that the capacity of the MCWWS was 5,000 connections and the model for repayment of the $58 million debt was based on that figure.

Evidence presented to the Council and the elected members in the last few days establishes clearly that from the time the Project Deed was signed for the construction of the MCWWS in 2007, to the present day, the capacity of the plant has always been 1216 at the opening of the scheme to 2,000 plus subsequently.  Those figures were included in numerous reports and plans over the years and it is beyond any doubt that staff members and successive chief executives were fully aware of the fundamentally flawed repayment model but took no action to remedy it.

The result is that the remaining $34 million of the MCWWS historic debt has become what is termed a “stranded debt”.  That means that there is no feasible means of repayment of the debt before the MCWWS reaches capacity in four years.  (Figure provided by the chief executive.)

It is absolutely essential that the chief executive fronts up to this issue and offers an explanation to the elected members and the community. 

Somewhat surprisingly the repayment model for the MCWWS has been completely omitted from the draft LTP.  It is now necessary that the draft LTP be amended to include proposals for a new repayment model to resolve the dire situation that has been created.  This will necessitate a new consultation process.  Otherwise the process will be open to legal challenge through the courts or the Minister.

Community proposal

The Mangawhai community acknowledges that the Mangawhai Central development must proceed and that the majority of the Panel’s recommendation must be adopted, even though they do not correspond with the wishes of the community,

However, there are recommendations in respect of two aspects of the Panel’s recommendation that the community strongly opposes.  Those two matters also impact on other recommendations which the community may seek to amend.

Option 3

The community proposes an alternative option for consideration by the elected members, Option 3.

Under this option the Council would resolve to defer any decision on the Panel’s recommendation pending a reconsideration and negotiation of stated issues raised by the community with the applicant and the Council.

This would defer making any decision at the Council meeting and would provide an opportunity for the chief executive to provide the clarification sought by Councillor Larsen. 

It would also enable the applicant, the Council, and the community, with full knowledge of the facts, to reach agreement in respect of the small number of disputed issues.  These are wastewater capacity and funding, the supply of water to the development, and consequential issues that might arise from those two issues, such as the number of lots permitted and the minimum size of lots.

The agreement would be based on a full disclosure of the facts, and would give the applicant the opportunity to reconsider its proposals for the disputed issues.

The parties would then be able to proceed on a cooperative basis rather than on a confrontational basis which would inevitably arise if Options 1 or 2 were adopted.

With openness and good will, the issues between the parties could be resolved in a short space of time and with minimal cost.

Potable water

During the hearing, ample evidence was presented to raise serious doubts about the feasibility of a reasonable and guaranteed supply of potable water being provided for the proposed development by rainwater harvesting and the bore on the property.

The applicant surprised everyone at the resumed hearing in February by announcing that it had obtained consents from the NRC to source a water supply from two watercourses on its land.

The applicant accepted that its proposals to harvest rainwater in tanks, and to provide potable water from a bore, was insufficient to provide a reasonable and guaranteed water supply. 

The two watercourses are dried up for a large part of the year and there are strict limitations on flow requirements that must be achieved before water can be taken.  This means that the water must be pumped to and stored in a reservoir to cover the long periods when no water can be drawn from the watercourses.

At the resumed hearing in February 2019 the Panel asked if the applicant had any plans for storing, treating, and reticulating the water.  Counsel for the applicant advised that there were no plans.

The consent to draw water up to a certain volume is not a guarantee that the permitted volume is available.  That is a risk to be faced, especially in the current drought conditions. 

Also, because there are no plans for storage, treatment, and reticulation there is the risk that the appropriate consents for subdivision and building may be declined.  The reservoir to store the water will be so large that consenting may be difficult.

There is also the added burden, risk, and cost to the applicant having to assume the role of a “water supplier” under the Water Services Bill when it is enacted later this year, along with all the draconian and compulsory obligations that it will be required to comply with.

It is also important to take into account that because the watercourse consent was not part of the original application and was only advised at the second hearing, the community was denied the opportunity of making submissions, either written or oral, on this pivotal proposal.

The Panel’s arguments in its recommendation in respect of water supply are somewhat narrow and flimsy.  The Panel accepts at 146 and 147 the concern of submitters over the depletion of the existing water supply situation and that this concern ‘should be resolved as part of the current plan change”.  However, the Panel does not resolve it.  It relies solely on the opinions of the applicant’s consultants (endorsed by the KDC’s consultants) in respect of adequate water capacity.

It is hard to understand why so much weight was given to the evidence of these expert witnesses when the weight given to expert witnesses for Mangawhai Matters (at 92) was reduced because they had made submissions in opposition to the plan change.  The presumption was that they were biased.

Whilst this may be the approach taken by commissioners in such proceedings the reality for the general community is that consultants and lawyers employed and paid by a party are no more than “hired-guns” who do the bidding of their client.  There is no independent judgment.

There should also be serious concern about the Panel’s comment at 152:

…. we must take the granted resource consents at face value as providing the plan change basis for adequate supply

When the NRC grants a consent, it permits the drawing of a maximum quantity of water strictly on the basis of the supporting figures provided by the applicant’s consultant.  The NRC is not concerned whether that amount of water is available, and it certainly does not provide the basis for an adequate supply of water to support a plan change, as suggested by the Panel. 

The Panel shows the same misunderstanding in 153 when it states that the water consents provide no certainty of supply beyond their 35 year term.  That is true.  It is also true that the consents provide no certainty of supply at any time during the 35 years of the term.

At 152 the Panel expresses a strange opinion on what constitutes a water supply:

….. treatment and reticulation etc are matters that must follow and be resolved prior to actual development and occupation.  We acknowledge the matters raised but those are not impediments to a plan change.  If the “reality” is different when it comes to development, then the development itself will be compromised.  That, as always, is the development risk.

The Panel surprisingly indicates that the ability to store the water, to treat the water, and to reticulate the water are irrelevant at this stage in establishing a reasonable and guaranteed water supply for its development.

The Panel accepts, somewhat cavalierly, that if the “reality” that it has accepted proves to be wrong then the development will be compromised at the later building stage.  That, it sums up, is the development risk.

Is that really the case?  Or does that risk sheet home because the applicant has not done its homework, failed to put together a sound proposal catering for the obvious risk factors, and the commissioners have endorsed a vague proposal with a huge amount of uncertainties and risks?

It is also notable that the Panel’s endorsement of the flow figures of the applicant’s consultants did not consider the effects of climate change in Mangawhai in recent years, as presented in submitters’ evidence to the Panel.  It also ignored the effect that the Water Services legislation will have on the development and its viability.

The commissioners may see such issues outside the scope of their role.  However, such an approach undermines the scrutiny that a plan change proposal should bring.  It would be so easy to rubber-stamp half-hearted proposals on the basis that any deficiencies would be picked up later at the subdivision or building stage.

Is the Panel correct?

Is the Panel correct in stating that if there is a failure to provide an adequate water supply at the subdivision or building stage then the development might be compromised at that later hurdle?

Is that simply an attempt by the Panel to assuage an unhappy community by representing that its recommendation is not the final word on the matter?

The community has a huge concern about the integrity of the Council staff.  The staff has embraced virtually every aspect of the proposed development and has misrepresented the capacity of the MCWWS in both the supermarket consent process and in the PC78 process.  In the eyes of the community It cannot be trusted to process subsequent consents fairly and in compliance with the law.

The applicant has already poured millions of dollars into this development.  It is unlikely that it will be concerned about the words of the Panel about stumbling at the building consent hurdle.  It is clearly confidant that the Council staff will approve all consents in the future, as it has done in the past.

Opportunity to establish water supply

Whilst the applicant must bear the blame for proceeding with such a development without first securing an adequate water supply, it is not too late for that omission to be remedied now.  If Option 3 were adopted, the applicant would have the opportunity to put together a complete proposal for a water supply that would satisfy the community.  The applicant could then proceed with the development with more confidence that it would not fall apart at the subdivision or building stage.

Wastewater capacity

The Panel accepted the assurances of the KDC staff and consultants as to the capacity of the MCWWS.  The Panel accepted the representations of the Mr Sephton for the Council as presenting the “factual position for the purposes of a Plan Change”.  This was despite the substantial evidence to the contrary provided by submitters.

Some of the evidence presented by submitters was disallowed because of procedural issues and it may be that the evidence of a Council expert witness was preferred to that of submitters, based on the bizarre logic adopted by the Panel that they had made submissions opposing the plan change, and were therefore biased.

The Panel also applied the same simplistic approach that it adopted in considering the adequacy of water supply.  It only considered (163) if there was adequate “structural framework” for the development.  An application for subdivision at a later stage could not proceed if the infrastructure was not in place.

The Panel accepted that a new disposal option will be required “imminently” but added at 167:

Should that matter stall then any development enabled by this plan change will stall.

And at 168:

We accept that not all the ‘ducks are yet lined up’, but they are sufficiently aligned for a plan change purpose.

Although the Panel may have accepted the version of the Council staff as being “the factual position” for “the purposes of plan change”, the evidence is overwhelming that the factual positon presented by the Council staff was not correct.

It is beyond any doubt that the KDC staff misrepresented the capacity of the MCWWS to the expert witnesses and to the Panel.  The expert witnesses relied on those misrepresentations, and ultimately the Panel, in reaching its decision, relied on the misrepresentations of the Council staff and the expert witnesses.

The Council staff also misrepresented the future plans for increasing capacity and the associated financial planning.

In addition, since the hearing further information has come to light that confirms that during the PC78 process the Council staff misrepresented the capacity of the MCWWS. 

Also, the Council has just acknowledged that for the past ten years it has applied a model for the repayment of the historic debt of $58 million for the constructions of the MCWWS with full knowledge that the model was fundamentally flawed.

This has created a “stranded” debt for which there is no feasible source of payment.  It has dropped a bomb amongst the Panel’s ducks.  

The end result is that there is simply insufficient capacity in the MCWWS to accommodate Mangawhai Central’s wastewater requirements, and there is a financial inability to fund the historic debt and the necessary increase in capacity if Mangawhai Central proceeds.

Both the capacity issue and the financial issues need to be resolved before the Mangawhai Central proposal can proceed, so that all parties know where they are going, that wastewater capacity is assured, and the costs are fairly spread between the new development and the community.

Option 3 creates that opportunity.

Consequential issues

If it is established that the water supply for the development is limited, that may impact on the size of lots permitted under Plan Change 78.  Larger lots may be required to ensure that more water can be secured through larger roof areas and larger tanks.

Likewise, the number of lots permitted may have to be limited.

Joint panel

It is proposed that a joint panel is formed consisting of representatives of the applicant, of the Council and of the community.  The panel would also include an independent expert with experience and expertise in resolving issues of this type.

The terms of reference of the panel would include agreement on:

  • The recommended plan changes accepted by the parties.
  • The recommended plan changes to be reconsidered by the panel.
  • The framework for the reconsideration of those plan changes.

The intention behind the proposal is to:

  • Remove all uncertainty as to the capacity of the MCWWS.
  • Reach agreement on how the capacity of the MCWWS can be increased to accommodate Mangawhai Central, or any alternatives for increasing capacity.
  • Assess the financial situation in respect of the MCWWS historic debt and other debts incurred since 2010.
  • Assess the costs of the increase in capacity of the wastewater services
  • Establish a sound financial plan to share the costs of the historic debt and the future debt between the existing community and the future community including Mangawhai Central.
  • Resolve the issues cooperatively and in good faith and for the benefit of all parties without recourse to legal action or any confrontational actions of any sort. 
  • To expedite the issues as soon as reasonably practical to enable the development to proceed without undue delay.

Wastewater: Framework for agreement

KDC Engineering Standards

The Council’s Engineering Standards at page 64 set out the approach that, in hindsight, should have been adopted by the Council:

The following requirements shall be met:

(a)Where subdivision or land development is within the area served by a Council system or an extension to a Council system is proposed, the written approval of Council’s Asset Manager shall be obtained and provided with the application to confirm that the Council sewerage system can be extended to serve the subdivision or development.  The Council is responsible for the assessment and approval of the Developer’s detailed design of proposed extensions to the sewerage system.

Council will advise the Developer’s designer of any limitations that may exist to the number of sections, peak flows or timing of flows that may exist.

If the existing network does not have sufficient capacity at the nominated connection location to receive the number of sections or peak flows from the development, the Developer will either need to:

  • Design and construct an appropriately sized attenuating storage to reduce peak flows to level compatible with the network.
  • Convey sewage to a different location in the network where adequate capacity exists.
  • Pay for the required upgrade to the system.

The first two options are not available so the third applies.

Development Contribution Policy

The draft Policy in the draft 2021/2031 LTP states:

2.13 Development agreements

The Council recognises the benefits that development agreements can provide for both developers and the Council itself.  To enable development, it intends to enter into agreements from time to time with developers for the provision, supply, or exchange of infrastructure, land, or money to provide network infrastructure, community infrastructure, or reserves in the district or any part of it.

A development agreement is the perfect vehicle for resolving issues of capacity and cost.  It is understood that the Council and Mangawhai Central have just entered into such an agreement.  A broader development agreement at this stage could iron out all the issues in respect of wastewater so that the applicant, the Council and the community were all agreed on the way forward.

Potable water:  Framework for agreement

The applicant’s proposals for wastewater are incredibly vague

There is no certainty that the applicant will be able, under its current proposals, to establish a reasonable and guaranteed water supply for its development.  There is the distinct possibility (outlined by the Panel) that it could stumble at the subsequent consent stage and not be able to proceed.

There are also issues that may arise from the Water Services legislation that may limit options for the future.

It therefore seems sensible to allow the applicant further time to investigate sources of water supply and to establish more definite proposals that are not open to future challenge

This would provide certainty for the applicant, for the Council, and for the community. 

Consequential issues:  Framework for agreement

Once agreement is reached on proposals for wastewater and water supply it would then be possible to consider the flow-on effect on consequential issues.  A deficit in wastewater capacity and a limited water supply could impact on the number of lots to be permitted and a minimum size for the lots.

Elected members conflict of interest

Mr Waanders noted that Councillor Curnow should be excluded from any reconsideration of PC78.  On the same basis Councillor Curnow should not be allowed to vote on the resolution to adopt one of the options.  While she wore a separate hat as a commissioner, she should not be allowed to vote on an issue based on the recommendation that she was a party to.

One also has to consider the ticklish question of Mayor Smith’s compromised position.  It is notable that both Councillors Larsen and Wethey have made it clear to the community that they were not able to voice an opinion on the Mangawhai Central development because they would ultimately be obliged to make independent decisions to adopt or reject the Panel’s recommendation.  They could not be seen to have predetermined the issue.

Mayor Smith has not shown such reticence.  Right from the start he has publicly celebrated his support for the proposal which has been widely reported in the media. He has developed a very close relationship with Viranda.  To avoid any risk of future legal challenge it would be advisable that Mayor Smith declares a conflict of interest and recuses himself from any decision-making because of perceived predetermination.

Option 4

Realistically it may be too late to introduce Option 3 at the Council meeting.  If such is the case, the Council is encouraged to defer any decision-making until the chief executive has had the opportunity to respond to the concerns of the community and the elected members over the misrepresentations of the Council staff and the acknowledged fundamental failure in respect of the repayment model for the MCWWS debt.

It would give the chief executive the opportunity to establish a sound factual platform and formulate plans for capacity and funding, and to negotiate a development agreement with Mangawhai Central Limited.

It would also give Mangawhai Central the opportunity to get its “ducks in a row” in respect of water and wastewater supply.

It would also enable the applicant, the Council, and the community to work collaboratively to achieve the best outcomes for the community whilst acknowledging the requirements of Mangawhai Central.

If both Mr Waanders’ two resolutions are put without amendment, and no alternative resolution is moved, then the elected members should reject both options.  Decision-making would then be deferred to a later date.

Obligations of elected members

Some elected members are in their first term and may not be aware of the legal obligations that the role imposes in respect of decision-making.

Under the Local Government Act 2002 the elected members constitute the decision-making body of a council.  That body must exercise its power wholly or principally for the benefit of the district.  That is, for the benefit of the ratepayers.

Any decision of a council may be challenged by judicial review in the High Court.  One of the grounds for judicial review is that the decision-maker did not take into account all of the relevant factors. 

OAG guidelines

The web page of the Office of the Auditor–General sets out the reasons why a council’s decision could be set aside on the ground of lack of “fairness” (209).  These include:

216
There are at least three elements of public policy underlying the rule against bias:

  • accuracy in public decision-making;
  • ensuring impartiality on the part of the decision maker; and
  • public confidence in the decision-making process.

“Justice should not only be done, but should manifestly and undoubtedly be seen to be done.”

222 Apparent Bias
Apparent bias may emerge from conflicts of interest of various kinds.  A decision maker may appear to be biased if he or she:

  • participates in an appeal against a decision which he or she made;
  • has any relationship to a relevant party;
  • has any personal prejudice towards a party or a party’s case; or
  • has predetermined the issue (by making his or her mind up before hearing all the relevant information).  (Underlining added)

224 Predetermination
A decision in the consultative process could be challenged if a decision maker has predetermined the question on which comment was sought. The rule against predetermination requires decision makers to remain open to persuasion and to not commit themselves to a decision until after having heard all the evidence.  Predetermination on the part of one councillor alone may be enough to invalidate a decision.
 (Underlining added)

In respect of the decision now before the Council, it is a fact that information has been provided to the elected members about the misrepresentation of the Council staff about the capacity of the MCWWS, and about the Council’s knowledge of the flawed repayment models for the MCWWS.  This information impacts on any decision-making in respect of wastewater capacity and should be taken into account.

A failure to consider that highly relevant information could be judged to amount to predetermination in any legal challenge

The Minister could also be invited to intervene if a council acts unlawfully or unreasonably and in breach of its obligations to its ratepayers.  A Commission, Crown Manager, or Crown Observer could be appointed to direct the council to act appropriately.

The actions of the Council staff in misrepresenting the capacity of the MCWWS and the failure to acknowledge the flawed repayment model for the MCWWS are serious failures that could trigger Ministerial intervention.

If the elected members endorse those failures of the Council staff by not enquiring into the allegations then the Council as a whole would become a party to the misfeasance.

There is also the issue of the loss of reputation, both for the Council itself and for the elected members.  The reputation of the Council is at an all-time low because of the irregularities of the Council staff.  The elected members are generally considered to be innocent parties because, like the community, they have been misled by the Council staff. 

However, if the elected members endorse the actions of the Council staff by making a decision without considering what the chief executive has to say about the serious allegations and acknowledgement of impropriety, the reputation of the elected members in the eyes of the community will be severely tarnished.

The elected members now have a window of opportunity to resist the pressure from the Council staff, to take a breath, to hear what the chief executive has to say, to consider all of the issues, and then make a fully informed decision.

 

Clive Boonham

Mangawhai Heads

30 March 2021

 

Appendix on next page

 

APPENDIX

 

Responses to Mr Waanders’ options

In his report Mr Waanders provides advantages and disadvantages for each of Option 1 and Option 2.

A response to Mr Waanders’ comments is provided below.

Mr Waanders’ comments are in blue, with our comments in black

Options

It would be problematic for Council to not accept the recommendations of the Hearings Panel, as the panel was delegated the responsibility (by Council) to hear all submissions/evidence.  The extent of Councils decision making is therefore limited because any departure (from the Hearings Panel recommendation) would require submissions to be re-heard in order to follow due process, including providing reasons for the decision.  Additionally, any possibility that the Council may wish to depart from the Hearing Panel’s recommendation and/or debate its merits carries with it a degree of risk of legal challenge, either as part of an appeal to the Environment Court or a potential judicial review of the Council’s decision on the plan change.  The options analysis below relates to whether to adopt the hearing panel’s recommendations as the Council’s decisions.

None of the above would apply if the Council adopted Option 3

Advantages

  • Council has followed proper process, in line with statute and the Hearing Commissioner Policy, to ensure recommendations to Council are independent and made by experienced and professional Commissioners
  • Council has delegated the Hearings Panel the authority to hear all matters and make a recommendation to Council.  Not agreeing with the recommendations, after not hearing the submissions would not be due or proper process.

Council is fully aware that much of the factual information in respect of wastewater capacity provided to the Panel by the Council staff, and relied on by expert consultants, was not true.  The Panel relied on that information in making their recommendation because they were compelled to rely on the advice from expert witnesses.  The Panel felt obliged to disregard the further evidence of submitters setting out the true situation because of the procedural requirements of the RMA and because submitters were perceived to be biased.

Since the hearing, further evidence has emerged of the factual misrepresentations of the KDC staff.

For the reasons given above, the recommendation of the Panel in respect of the wastewater capacity issue were based on misrepresentation of fundamental facts.  That has now been established.  In those circumstances it would be a breach of due and proper process to adopt the recommendation of the Panel knowing that it was based on those misrepresentation.

  • Significant engagement and transparency on the plan change has occurred through robust Council processes.

That is not correct.  In respect of the wastewater capacity issue the council staff have repeatedly misrepresented the facts.  There has been no transparency.

  • Council has invested time and resources into processing the Private Plan Change and organising the hearings.  Some staff have been reallocated from their business as usual work to complete all processes.  There is a soft cost to this reallocation of resource.

This is a poor argument.  The Council staff created huge problems because they mispresented the facts of the wastewater capacity and failed to require a sensible development agreement with Mangawhai Central that provided for adequate servicing of the development.

  • The applicant, local individuals, and the community have also invested significant time and their own resources into the process.

Indeed.  The applicant has itself to blame for not planning for the basics of potable water and wastewater services for its development.  Even if the Council adopts the Panel’s recommendation the applicant will be faced with endless problems because the reality is that there is insufficient potable water under its current proposals, and there is no wastewater capacity.

The community is fully aware that there is insufficient potable water and wastewater service for the development.  It is also aware that the Council misrepresented the facts to the Panel.  There is anger in the community and it does not want the recommendation of the Panel to be adopted in its present form.

  • Avoids any actual and possible perceived Council predetermination or bias and will help protect Council and ratepayers from potential judicial review on public law matters.

The total endorsement of PC78 by the KDC and the factual misrepresentation by the KDC staff created the widely-held perception in the community of predetermination and bias.  The reliance of the Panel on the misrepresentations of the Council staff, for whatever reasons, when the actual facts painted a different story, increased that perception.

If the KDC adopts the recommendation in full knowledge of the misrepresentations, and in full knowledge of the correct actual information revealed after the hearing, then it will be absolutely clear to the community that the outcome of the application was pre-determined by the Council.

Disadvantages

  • None apparent

The disadvantages of adopting the Panel’s recommendations are canvassed above.

If the Council adopts a recommendation that is partly based on misrepresentations from Council staff and it is aware of that misrepresentation, and if it is also aware of facts that have emerged subsequent to the hearing that challenge the veracity of the “facts” on which the Panel based its recommendation, then it would not be following due and proper process.

In such an instance the Council would open itself to legal challenge in the form of an appeal to the Environment Court, or an application to the High Court for the judicial review of the Council’s decision.  That is an avenue that the Council should not go down when there is a better alternative available.

OPTION 2

Reject the Hearings Panel’s recommendation and re-hear the application.  This is not the recommended option.

Advantages

  • None apparent

Agreed.  Option 1 would create endless difficulties which would be avoided if Option 3 is adopted

Disadvantages

  • It is well established in local government that where a Council delegates a Hearings Panel to hear and provide recommendations for RMA processes, Council’s consideration of the recommendations becomes more of a procedural decision.  If Council were to revisit the reasoning or conclusions of the Hearings Panel, issues of natural justice and fairness will arise.  This would require Council providing reasons for any decision not in line with the recommendations.  It would also mean that Council would need to re-hear all of the submissions and evidence.

This comment is a sweeping generalisation.  If it is established that the Council staff made factual misrepresentations in its evidence to the Panel, and those misrepresentations were relied on by the expert witness in their evidence, and consequently relied on by the Panel in reaching its recommendation, then pursuant to the requirements of natural justice, equity and fundamental fairness, the Council would be obliged to reject the part of the recommendation based on those misrepresentations.  This obligation would be reinforced if the Council was apprised, after the hearing, of factual information that might well have persuaded the Panel to make a different recommendation.

No rehearing would be requires if Option 3 is adopted.

  • If Council was to re-hear the matter, the current Hearing Commissioner Policy applies. There are only four elected members qualified with the Making Good Decision Certification with only one of those, certified as a Chair.  Councillor Curnow would be omitted from this process, leaving three Councillors.  Careful consideration of Councillor conflicts and experience would need to be considered to ensure that the hearing process was robust.

No hearing would be required if Option 3 is adopted.

  • There is also a high likelihood of reputational risk as Council would not be adopting the recommendations provided by very experienced, professional RMA hearings practitioners.  Rejecting the recommendations from a Hearings Panel such as this would be extremely unusual.

The Council has already suffered huge damage to its integrity and competence because of the misrepresentations of the Council staff to the Panel, and because of the 10 year cover-up of the flaws in the repayment model for the MCWWS historic debt.

If the Council ignores the truth surrounding the capacity of the MCWWS and the inability of the community to pay the historic debt, and adopts the Panel’s recommendation, then the damage to its reputation will be irreparable.

  • This option would result in significant additional costs (for the applicant, Council and submitters), delay the process, and may result in Council not meeting its statutory obligation to make decisions on submissions within two years of notifying the Private Plan Change -April 2022

Cost would be minimal if Option 3 is adopted

The statutory deadline is a red-herring.  There is a year available to resolve issues with the applicant.  If Option 3 is adopted, with good will and good sense a solution could be found within a very short space of time.

Financial implications

The development will contribute to the financial strength of Mangawhai through the collection of development contributions, creating additional rateable properties and the development of other physical works to be included, such as a large water storage reservoir.  As this was a ‘Private Plan Change’, the developer was obliged to fund the plan change application (as opposed to be funded by general ratepayers)

The development contributions will be applied to repay the historic debt which was incurred over 12 years ago.

There is insufficient wastewater capacity for Mangawhai Central.  This means that further funding for capital infrastructure which will be borne by the current community.

There are no plans for a large storage reservoir, and consents for such a huge structure may not be approved.  In any case the capacity of the reservoir would only be sufficient, if that amount of water is available, to service Mangawhai Central.

The implication is that the reservoir would be an asset to the community.  This is factually incorrect and contradicts the Council’s clear statements that it will not get involved in a reticulated water supply for Mangawhai.

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