FAQs

Our Long-term Plan sets out the work Council intends to do over the next 10 years with a focus on the first three years. It details the planned activities, services, and projects that will be delivered, how much they are likely to cost, and how we plan to pay. The LTP also sets out the likely impact on rates. 

The Local Government Act (LGA 2002) requires that all councils produce a long-term plan every three years. The Plan must look out at least 10 years. We have to consult publicly its proposed content.  

The LTP affects everyone living on the Kāpiti Coast, in one way or another. It directly impacts ratepayers because, unlike many other councils, Kāpiti does not have other revenue-earning assets like ports so we rely on rates to fund most of our activities. Our LTP impacts the services and facilities we offer, and how we prioritise our work.

Councillors have spent several months working through their strategic priorities, our operating and capital expenditure, the needs and aspirations of our community, and what trade-offs might need to be made. This has helped inform this LTP’s three key topics for consultation. 

In addition, under the LGA 2002 we are required to review our financial and infrastructure strategies and some of our key policies as part of our LTP. 

The Infrastructure Strategy sets out what we need to spend on core infrastructure services (transport, stormwater, water supply, wastewater, and coastal protection like seawalls) over the next 30 years. 

The Financial Strategy sets out how the council intends to manage its financial affairs prudently. The strategy sets limits for rates increases, debt levels, and other financial aspects.

Both of these strategies are core components of each LTP and guide what we will do over the next ten years and how much it will cost. We consult with the community on these policies and other big-ticket items to get an understanding of the public’s appetite for specific projects or council spending in general.

The consultation document’s preferred option is for an average rates increase of 17% in year one of the LTP, reducing to 7% in years 2 to 10 of the LTP. We recognise this is a bold proposal and not what many in our community will want to hear, but it’s sound financial management that will have long-term benefits in two ways:

1. Allow us to quickly reduce debt so we will have room to borrow in an emergency, this will increase our resilience should we need to respond to a natural disaster or other unforeseen event.
   
   
2. Allow us to significantly reduce the amount of interest we pay on our borrowings – if we don’t reduce our debt, we’ll be paying around $400,000 in interest per week by 2034.

We’ve worked hard to reduce costs as much as possible, while still ensuring core assets aren’t compromised. 

A significant proportion of our cost increases are unavoidable e.g. rising inflation, interest, depreciation, and personnel costs alone increase the average rates by 9.6%.

We made some hard calls too on discretionary budgets to initially reduce operating costs by $9.4 million through:

• $3 million reduction to our operating costs by prioritising funding only for essential infrastructure and community facilities.
• $1.7 million reduction to personnel costs by capping staff numbers 
• Anticipating government would reimburse us for debt related to our three waters assets, we initially opted to debt-fund an operating cost shortfall of $4.7 million for 2024/25. Unfortunately, with the repealing of the three waters legislation, this is now back on our books.

The only way to get rates down further is to reduce operating costs which would reduce the current levels of service. This needs to be considered in the coming years as we don’t want to compromise on the things that make Kāpiti a great place live.

The chief executive has placed a cap on staff numbers to reduce our personal costs – this equates to a $1.7 million reduction. Reducing staff numbers further will require us to make some operational changes which may lead to reduced levels of service.

The Government’s repealing of the three waters legislation means we now have to fund $4.7m for our three waters operating costs in 2024/25, which was expected to be transferred to a regional entity. Rates will have to increase by 5% just to pay for this. In the consultation document we’re asking the community whether they think this should be funded by increased debt or increased rates.

To further reduce operating costs, we would need to consider lower levels of service, but this would have to be done in a meaningful and informed way to avoid compromising the things that make Kāpiti a great place to live. We don’t plan on doing this right now, but it may become necessary in coming years.

Council has wide ranging responsibilities under the Local Government Act 2002 that go way beyond core infrastructure. We are also dealing with an increasing load of unfunded government mandates. 

As well as providing essential infrastructure such as water supply, wastewater management, flooding protection, local roads, and street lighting, we also help connect our community by providing and looking after parks, pools, and libraries. We have to administer laws and regulations on behalf of central government such as building consents, food safety, alcohol licensing, and animal management. 

These responsibilities keep our environment and communities safe, and ensure our district grows sustainably, and attracts businesses, visitors, and new households. We are required to plan for our community’s current and future needs. 

We factor population growth into our planning and budgets as it impacts levels of service and where and when we invest in essential infrastructure.

Unavoidable costs make up 9.6% of the average rates increase proposed for 2024/25. We expect inflation, interest and staff cost increases to reduce in coming years and we’ve set average rates increases from years two to 10 at a level that we believe strike a balance between affordability and building a resilient future for Kapiti.

In developing our financial strategy, we considered affordability for our community. In 2007, the Shand Report established that rates should not exceed more than 5% of household income.

We have used 7% of household income as our affordability proxy on the basis that the 5% measure was set 17 years ago.

Projecting this forward ten years, average rates in 2033/34 will make up approximately 7.5% of household income. While this is slightly higher than our self-imposed rates affordability proxy, we need to strike a balance between affordability and creating a resilient future for Kāpiti.

Council is looking how it can expand the provision of older persons’ housing in the district. Our community has made it clear we should step up in this space. We’re looking for ways of growing and improving the supply of affordable housing in the district by making it possible to access government rental subsidies and better wrap around services for tenants. 

This will require a change in operating model, so we’re consulting with the community on options to achieve this.

No. We are in a substantially different economic and political environment than previously and must make decisions on what we’re facing now.  

We’ve not increased water rates for several years and now we have to meet the growing cost of delivering this service, as outlined in the Fees and Charges document.  

We can’t guarantee that, and it’s not a responsible way to manage our business and look after our community.