Hamilton looks to bridge growth challenges


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Tuesday 3 October 2017


Where Hamilton can grow and how much will it cost were the hot topics at a Hamilton City Council briefing last Friday.

Councillors were briefed on where housing can be built to accommodate the population increase, and what infrastructure and community facilities are required.

Hamilton is estimated to have 169,890 people living in the city by 2020 increasing to 187,479 in 2028*.

Hamilton City Council General Manager City Growth Kelvyn Eglinton says the 10-Year Plan process shows the city needs to prepare for the challenges of unprecedented growth in the next few years.

“Our city is well set up for development in established suburbs over the next few years, but now we’re at a point where we also need to invest in new growth areas so the right roads and water systems are in place to service even more houses,” says Mr Eglinton.

“Opening a growth area is expensive no matter which way we go, so we have to look at what areas are best for the city and understand what the financial impacts will be over then next 10, 20 and even 30 years.

“The last growth area the Council unlocked was Rototuna, which started in the mid-2000s and included building the Pukete Bridge. The investment then has allowed the expansion of that area over the past 17 years and driven huge population growth in the north of the city.”

The scenarios presented focused on a combination of growth in Peacocke, Rotokauri, Rototuna, Ruakura, Te Rapa North, and the central city and infill. Each scenario looked at the required levels of investment, particularly in Peacocke and Rotokauri, and timings. The options also included estimated costs and different funding options including the Housing Infrastructure Fund (HIF), a $273M interest-free 10 year loan, and varying NZ Transport Agency support through funding assistance rates.

“Council staff recommended focusing on the most affordable option which includes only the ‘must have’ costs to get Peacocke underway as well as other city-wide investment including Rototuna, Rotokauri and Ruakura. The recommendation achieves ‘just enough’ investment in Peacocke to meet the targets set by the government for the amount of land ready for housing.

“This option has benefits of access to the HIF loan, the Transport Agency support and can accommodate the largest number of extra homes over the next 30 years. Staff have also applied to the Transport Agency asking for an increase in the subsidy they pay for the Peacocke road projects, normally 51 per cent.

Peacocke also has the benefits of creating links to the Southern Links road network and balancing the city, bringing the central city closer to the geographic centre.

“To be able to pay for the huge cost of growth, we need a lot more debt capacity. Essentially, the more revenue we have through rates, the more money we can borrow to pay for growth. For every extra $1 we get through rates revenue, $2.30 is available through debt.

“To create this capacity, a fairly significant rates increase would likely be needed which will also align our rates with other high growth councils. Without the increase in rates, opening any growth area is unaffordable, even with a potential interest-free loan from the Housing Infrastructure Fund.”

The draft 10-Year Plan budget will be considered by the Council on 19 October, and will be the result of thousands of hours of work to review Council’s assets, services, facilities and financial structures.

Further Council budget meetings, community consultation and hearings will be held before the 10-Year Plan is finalised next year.

Additional note:
• Population projections are based on NIDEA Low estimates

Page reviewed: 03 Oct 2017 2:38pm