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4.7 Crown Contribution

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Historically, the Crown has undertaken a wide range of activities in the Region. While these have not been traditionally rateable, the Crown has made subsidies and loans available at favourable rates.

Responsibilities for some of these activities are now with various agencies.

As other contributions from the Government reduce, some argue that inequities arise, as the Region effectively subsidises benefits for people who do not live in the Region, and services provided to the Crown as a landowner.

Broadly four categories of costs and benefits can be identified.

  1. Indirect benefits experienced beyond the Region’s boundary
    • Use of recreational and scenic areas by people from outside the Region. Other New Zealanders and overseas tourists enjoy natural recreational facilities throughout the Region, such as Lake Taupo and the lower Waikato River.
    • Benefits to trout fisheries from maintenance of high water quality.
    • Water from the Waikato River will provide the Auckland Region with a secure water supply to allow for future growth. Maintaining and improving water quality standards means that less treatment will be required to make the water drinkable. This benefits Aucklanders.
    • Maintenance of a lifeline corridor through the Region. An important aspect of emergency planning is the ability to ensure ‘lifeline corridors’ through particular areas. These ensure provision of essential services, transport and infrastructural services such as power and telecommunications. Maintaining these corridors within the Waikato Region benefits those outside the Region who may otherwise be affected by a break in the Waikato Region’s lifeline.

    Environment Waikato has not attempted to quantify these indirect benefits, as it would require detailed and expensive economic research (estimated to cost approximately $40,000). This expense is likely to outweigh recompense from the Crown, as there is currently no clear mechanism to recoup costs.

  2. Benefits and contributory effects from the Crown as a landowner
    • Department of Conservation lands are largely not rateable. As most of these lands are in natural or regenerating forest cover, they reduce runoff and flood peaks. Environment Waikato has not sought to rate these lands but is concerned that some aspects of land management are less than desirable on some of the Department of Conservation’s (DoC) lower priority sites.
    • Hydro lake shore reserves vested in Land Information New Zealand (LINZ) but protected under asset management plans are primarily maintained to lessen the effects of lake level fluctuations arising from hydro operations.

    Rates foregone for catchment management activities from the Crown as a landowner are not considered to be significant, given the effect of DoC lands as a flood alleviator.

  3. Utility benefits for services currently or formerly provided by the Crown
    • Protection of the North Island Main Trunk rail link, providing reduced maintenance costs and security of access. Even though rail services have been privatised, Environment Waikato has no ability to rate Tranzrail because the tracks are on Crown reserve land.
    • Protection of State Highways 1 and 2, providing reduced maintenance costs and security of access. Environment Waikato has made representations to Transit NZ for a contribution to costs. However Transit maintains that there is no legal basis to contribute to catchment management costs.

    Both of the above matters are still being pursued by Environment Waikato with the Crown, and are considered significant issues.

  4. Main channel maintenance

    A key area of concern for the Lower Waikato ratepayers is the removal of Government support for works in their zone as a consequence of the additional flow created by the Tongariro Power Scheme diversions. The deeds of the current agreement between the former Waikato Valley Authority and the Crown, providing for the Crown to fund Main Channel maintenance, are due to expire in 2003. Environment Waikato considers that an ongoing obligation exists for the Crown to fund Main Channel maintenance. Moreover, ratepayers consider that because there is substantial national and out-of-Region use of the Waikato River in the development of New Zealand, the Crown has an even stronger obligation to contribute to the maintenance of the Main Channel.

    On the ratepayers’ behalf, Environment Waikato is requesting the Government to consider an ongoing contribution to works in the Lower Waikato Management zone for the reasons outlined above.

    However, since the introduction of the State Owned Enterprises Act in 1986, Environment Waikato has been able to rate State Owned Enterprises, such as hydro power companies Mighty River Power and Genesis.

    Environment Waikato will also soon be able to rate utility services whose assets must now appear in the ratings valuation roll at capital value. This will allow companies such as Transpower, Natural Gas Corporation and Telecom to be rated.

    Environment Waikato will continue to pursue Tranzrail and Transit NZ for contributions toward the protection they receive from various works. It will also ensure that recoveries are made from utilities that have recently become rateable.

    Environment Waikato will also continue to request continuation of a Crown contribution to works in the Lower Waikato on behalf of the Liaison Subcommittee.

    Any contributions received from the Crown, SOEs and private utilities which have recently become rateable, and which have not been budgeted for in Project Watershed, will be offset against the appropriate rate.

  5. Estimated Crown Cost Allocation

    During the preparation of the Funding Policy for Project Watershed, Council estimated an appropriate cost allocation to the Crown for road and rail utilities of approximately $250,000. In addition to this, the Crown owns land within the Project Watershed area. It is estimated that this holding would attract a general rate, and catchment and zone differentials, totalling approximately $35,000 to $50,000. As much of the Crown land is forest it would be considered an alleviator for the purposes of the catchment contributor differential. Therefore the amount of forgone rates due to a legal inability to rate the Crown and its road and rail utilities is approximately $250,000 to $300,000.