Nelson City Council agrees to cost-sharing package to support city recovery

Nelson City Council agrees to cost-sharing package to support city recovery | Insurance Business New Zealand

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Nelson City Council agrees to cost-sharing package to support city recovery

This is worth up to $12.3 million

Insurance News

By
Abigail Adriatico

The Nelson City Council has agreed to a cost-sharing package that will support the city’s recovery from the severe weather event it experienced in August 2022, according to a release published by Scoop.

“Today’s Council decision to formally accept the government’s offer is another important step in our recovery work. The decision is consistent with our objectives of building back better, supporting families with badly damaged properties and managing the cost pressures on ratepayers,” said Nick Smith, Nelson’s mayor.

The cost-sharing package with the central government will be worth $12.3 million. One aspect of the package, which was a proposal to buy out up to 14 affected properties, will undergo a community consultation.

What will the package include?

The decision that authorized the chief executive to enter an agreement with the Crown that was still subject to consultation followed the offer made by the central government which was the package worth $12.3 million that included the following recovery measures:

Up to $6 million for the betterment of slips on council-owned land that are affecting residential properties
A lump sum of $300,000 to monitor the Tāhunanui Slump, which will cover a period of 10 years at $30,000 per annum
Up to $6 million as a 50% contribution to support the buyout of up to 14 properties where the landslide risk is too high for those property owners to return to their homes and the cost to mitigate that risk is prohibitive

“These families are in limbo with few options on a way forward. I’m pleased that after extensive lobbying for additional government support to help these residents and offset the cost to ratepayers, this cost-sharing package was offered to council,” said Smith.

The central government had also made a commitment wherein an accommodation allowance will be available to families that have experienced troubles paying for a mortgage on a home they can’t live in and running out of insurance-funded support to cover the cost of a rental property.

Members of the council agreed to have a community consultation regarding the private property buyout measure. This was part of the consultation on the Long Term Plan 2024-34 which will occur in March-April 2024. The package was based on 50% of any buyouts with a limit of $6 million and will require the council to fund its 50% share of the buyouts and associated costs.

“This consultation will take some time but will provide the public and affected property owners with the opportunity to comment and have input into the principles for the buyouts,” said Smith.

The $6 million betterment portion will be used to reduce the $17.3 million that was used to address the slips originating on council land, which was an expense approved by the council in May. With that, the costs to the council will be decreased to $11.3 million.

Smith said that the package was similar to the support given to the North Island communities that were affected by Cyclone Gabrielle and the Auckland rainfall events.