Hutt City debt set to reach $1 billion

Monday, 19 February 2024

Hutt City mayor Campbell Barry says the city has to invest in its future after decades of under investment. He is proposing a 15.9% increase in rates in the council’s draft long term plan.

A 15.9% increase in rates is just the beginning of the tough news facing Hutt City ratepayers.

The council is about to consult on its draft long term plan, which includes demolishing the Petone Wharf.

Debt in the city of 113,000 is set to rise to $1 billion, or $8850 for every man woman and child on its current population, as the council struggles to deal with years of underinvestment in infrastructure.

There is one surprise in the plan. After decades of investigation, the council is budgeting $188 million for the Cross Valley Link, taking traffic from Seaview to State Highway 2. It will be welcomed by Hutt South MP Chris Bishop, who supported the road on the campaign trail.

The new link road, taking traffic off the Petone Esplanade, would connect with the Petone Grenada road, which Bishop also supports.

The council is proposing to demolish the Petone Wharf and use the $21 million allocated to restore it, to build a new library.

The council’s draft plan lays out the challenging situation facing the city.

In their message to ratepayers, Mayor Campbell Barry and council chief executive Jo Miller said they want to see the city thrive and continue to grow.

They acknowledge the impact such a large rate increase will have at a time when inflation is high but argue the city has no choice.

“Our council is dealing with a backlog of historic underinvestment in our key infrastructure – shown in our ageing pipes and the risk of future water shortages.”

They warn that if Hutt City is to grow it has to invest in the basics, the supply of housing, as well as fixing pipes and roads.

To meet the growing population, the council plans to spend $2.6b over the next 10 years on capital projects, of which 62% is on water services and 21% on transport.

Although the council would like to spend $2.5b over the next 10 year on Wellington Water, the plan says that without central government funding that is “unaffordable” and it had instead budgeted $1.5b. Installing water meters is included at a cost of $78m with funding beginning in 2024/25.

The earthquake prone Petone Rec grandstand faces an uncertain future.

Although the plan proposes to significantly increase its investment in water infrastructure, a memo to the committee considering the draft plan notes that it is still not enough to get on top of leaks in the city.

The capital investment in water and transport would be funded by borrowing - set to reach $1b in 2029.

The draft plan contains mixed news for Petone residents. Money set aside for upgrading the much loved Petone Wharf would instead be used to build a new library and demolish a section of the historic Petone Rec grandstand.

Instead of upgrading the wharf, which has been closed since 2020, the council now favours demolition.

The existing library has watertight issues and the council is proposing to demolish it and build a new multi purpose facility, which could also include apartments.

For the average residential ratepayer, the 15.9% increase equates to a rise of $9.89 per week.