Key change
Valley floor three waters infrastructure
Type of spend: capital
Lower Hutt is a rapidly growing city, and we expect our population to keep
increasing. The valley floor suburbs – Hutt Central, Waterloo, Epuni, Woburn,
Avalon, Naenae, and Taitā – will see the biggest growth, which means we need to plan
ahead to enable more housing to be built in these areas.
An important part of this plan includes developing underground infrastructure on
the valley floor now. We have two major infrastructure projects planned on the
valley floor to support more housing in Hutt Central, Woburn, Boulcott, and Epuni:
stormwater alleviation and a new wastewater bypass. Together, these projects will
directly benefit the existing community and can support up to 3,500 new homes.
- The stormwater alleviation project includes a series of pump stations, new stormwater rising mains (pipes that use pressure to move water against gravity), and extensions to existing stormwater pipes. The impact of these changes will mean less risk of stormwater flooding in Hutt Central, Woburn, Boulcott, and Epuni during severe weather.
- The new wastewater bypass includes new wastewater pipe work, a pumping station, and a new rising main from the new pump station across the river to connect with an existing sewer.
These projects have been made possible now due to significant funding from the
government’s Infrastructure Acceleration Fund (IAF), which we received in October
2022. We applied to the fund in 2021, so during the last Annual Plan we included
some conservative estimates in our future budgets in case that application was
successful.
Since we now know how much funding we’re receiving, we’ve revised our budgets for the
coming years to take that funding into account, as well as cost increases due to
inflation and updated population growth estimates.
-
Total project cost $174.4 million
-
Hutt City Council’s share of the bill $30.6 million
-
Government funding $98.9 million
-
Developer contributions* $44.9 million
* We expect to recover these development contributions over the long-term
(which extends beyond the last year of our 10 Year Plan), which will then contribute
to these projects. In the short and medium term, we’ll pay for these projects with
long-term debt and government funding from the IAF.
We’re able to scale these projects up and provide more support for housing due to the
government’s contribution. This also means we’ll start doing the bulk of the work
from 2024-28 (instead of 2023-26 as planned).
The total estimated cost of this project is now $174.4 million.
Changes at a glance
Impact on 2023-24 budget
Net decrease of $120k
Impact on future budgets
Net increase in project cost of $54.5 million by 2031
Impact of not making this change
A condition of the government
funding is that we also invest a certain amount into the project. Therefore, if
we don’t increase our budget to carry out these projects, we’ll have to return
the government funding
Without government funding to help pay for the infrastructure, it’s unlikely we
can afford to carry out both projects as described here. We’ll have to reduce
the scope of the investment, which will ultimately limit the number of new homes
that the new water infrastructure could support. This means fewer new homes than
planned to help ease pressure on housing demand
Wellington Water operating costs
Type of spend: capital
Wellington Water is a council-controlled organisation, and Hutt City Council is a
co-owner. We provide budget for them to maintain and develop our three waters
infrastructure, and they’ve advised us that they require additional budget to meet
rising costs.
These operating costs fund the day-to-day work of Wellington Water, rather than
investment in particular infrastructure. This work includes things like responding
to reports of leaks and repairing them, as well as proactive investigations of our
network. The investigations work is especially important for future planning and
will also help ensure a smoother transition to the new entity once the government's Three Waters Reforms take place.
We’re proposing that we increase the budget to meet Wellington Water’s increasing
operational costs.
The total estimated operational cost is projected to be just under $30 million per year, which is funded largely through rates and partially by debt.
Changes at a glance
Impact on 2023-24 budget
Net increase of $5.6 million
Impact on future budgets
Average net increase in costs of $5 million per year ($41.4 million by 2031)
Impact of not making this change
If we don’t fund Wellington Water’s increased operational costs, then it
could delay future improvements, and lead to equipment failures and system
downtime. If we do provide the funding but don't increase rates funding we'll have to make services cuts in other areas
