July 2022

Audit NZ gives Tauranga City Council funding warning as 13.7pc rates rise approved

Concern from Auditor General re increased expenditure of TCC over agreed LTP 2021. (from BOP Times report)

Tauranga ratepayers will pay an average 13.7 per cent more in their rates bills to help fund key city infrastructure projects.

But the office of the Auditor-General has warned city commissioners that how the council plans to fund such projects could result in others being delayed or put off altogether.

“However, a presentation from Audit New Zealand highlighted concerns about the uncertainty surrounding the Civic Precinct plans and other key infrastructure projects.

Audit New Zealand's Clarence Susan said while ratepayers were expected to fund half of the cost of about $150m, the remainder was expected to come from Government, grants and philanthropists but this funding had not yet been sought.

Susan, speaking on behalf of the Auditor-General, referred to the council's plans to rely on the Government's Infrastructure Funding and Financing Act to progress its Transport System Plan and Tauriko West developments. If successful, these projects would be financed by an external party that would charge levies, to be passed on alongside council rates.

Whether this private financing would be affordable would not be known until later.

"If the funds cannot be secured at a satisfactory financing rate, the council is expected to then rely on debt and development contributions funding," Susan said.

"This could result in other projects being delayed or reprioritised to avoid breaching its debt limit, affecting current or future improvements to levels of service."