Water and Waste Committee Meeting Held on Thursday, 13 September 2018 at 10 Am

761

Adopted Report of the Water and Waste Committee Meeting held on Thursday, 13 September 2018 at 10 am

City of Gold Coast Council Chambers 135 Bundall Road Surfers Paradise

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Index Adopted Report 761 Water and Waste Committee Meeting Thursday 13 September 2018

PRESENTATION: Draft Water Strategy

Item Direct. File Page Subject

1 WW CM787/788/06/01(P1) 10 Water and Waste Committee Action List and Forward Planning Schedule

2 WW WSS1125/1227/02(P1) 13 Water and Waste Annual Register of Council Directions

3 WW FN334/252/18(P9) 15 Water and Sewerage Services Financial Performance as at 30 June 2018

4 WW FN334/252/19(P2) 47 Waste Services Financial Performance as at 30 June 2018

5 WW WFB600/259/14(P2) 66 Draft Water Strategy for Community Consultation

General Business

KEY: OCEO - Office of the Chief Executive Officer OCOO Office of the Chief Operating Officer EPE - Economy, Planning and Environment OS - Organisational Services LC - Lifestyle and Community TI - Transport and Infrastructure WW - Water and Waste

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ADOPTION BY COUNCIL 21 SEPTEMBER 2018

RESOLUTION G18.0921.015 moved Cr Taylor seconded Cr Boulton

That the Report of the Water & Waste Committee’s Recommendations of Thursday, 13 September 2018, numbered WW18.0913.001 to WW18.0913.005, be adopted.

CARRIED UNANIMOUSLY

ATTENDANCE

Cr P Taylor (Chairperson) Cr K Boulton Cr R La Castra arrived at 10.04am Cr PJ Young Cr G Tozer Cr PC Young

Cr W Owen-Jones Visitor Cr G Baildon Visitor - arrived at 10.13am

Mr P Heaton Director Water and Waste Ms K Baker Manager Service Sustainability Ms M Heshmat Executive Coordinator Strategic Planning

APOLOGY / LEAVE OF ABSENCE

PRESENTATIONS

Draft Water Strategy Ms Maryam Heshmat Executive Coordinator Strategic Planning

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ITEM 1 WATER AND WASTE WATER AND WASTE COMMITTEE ACTION LIST AND FORWARD PLANNING SCHEDULE CM787/788/06/01(P1)

Proposed Date Subject Action Action Officers

October 2018 Smart Metering of Community Title Scott Scheme (units and complexes). Emmonds/ Chris Owen

October 2018 Proposed State Government Landfill Mairead 2 That Council note a further Report will be provided on the Waste Levy Lenihan / proposed introduction of the Waste Levy and implications Recommendation: WW18.0620.005 Chris Owen for Councils before the September Budget Review 2018- 19. October 2018 Metering and Leakage Scott Council notes that further consideration is being given to Recommendation: WW16.0720.004 Emmonds/ residential meter location and other issues to support Chris Owen ongoing development of Council’s Concealed Leakage Remission Policy, which will be brought to Council at a later date.

October 2018 Scientific Services Delivery Model – Tim Beales/ That the Director Gold Coast Water and Waste report back to Implementation Plan Chris Owen Council in July 2018 on progress associated with the Scientific Services Implementation Plan.

October 2018 Implementing a City Wide Food Mairead That a report addressing FOGO recovery including Organics, Green Organics (FOGO) Lenihan/ anticipated implementation as part of Solid Waste Strategy service Chris Owen 2024.

November 2018 Project update Long Term Recycled Mark Water Release Plan Herrmann/ Brett Lawrence

November 2018 Improved Control and Access to Waste Mairead 3 That Council notes a further report will be provided in late and Recycling Centres Lenihan/ 2018 on the preferred method for control of access and Recommendation: WW18.0125.008 Chris Owen use at waste and recycling facilities. 761st Council Meeting 21 September 2018 11 Water And Waste Committee Meeting 13 September 2018 Adopted Report

ITEM 1 (Continued) WATER AND WASTE COMMITTEE ACTION LIST AND FORWARD PLANNING SCHEDULE CM787/788/06/01(P1)

Proposed Date Subject Action Action Officers

November 2018 Improved Control and Access to Mairead 2 That Council endorses assessment of the potential for Waste and Recycling Facilities Lenihan/ designation of waste and recycling centres into domestic Resolution: G17.0621.014 Chris Owen waste only, and full waste facilities, with a report to be presented on the proposal by the end of 2017-18 financial year.

December 2018 Alternate Billing Options for Water and Karen O’Brien 2 That in view of the benefits to customers, Council Sewerage Utility Charges endorses a future transition to rolling billing for water and Recommendation: WW17.0426.006 sewerage utility charges with both fixed and variable charges billed in arrears. 3 The proposed future transition to rolling billing to be scheduled to align with the establishment of a new utility billing system. 4 That a report to be provided back to Council by December 2018 providing details of on the proposed transition plan. December 2018 Catchment Management Community Joshua Evans That Council notes the framework will be developed in Partnerships Framework / Kathy Baker conjunction with and align to the current Water Strategy Recommendation: WW17.1205.003 (under development) which recognises Community partnerships as a key objective. 2 That Council note that a decision on LGP Stage Three is December 2018 Local Government Platform Stage Karen O’Brien deferred until February 2019 due to items outlined in this Three report. Recommendation: WW18.0320.005 3 That Council note that a Business Case will be bought back to Water and Waste Committee in late 2018 on the preferred approach for LGP Stage Three. That a report brought back to Council on the outcome of the December 2019 Introduction of Commercial Food Mairead trial. Waste Pilot Lenihan/ Recommendation: WW18.0320.003 Chris Owen 761st Council Meeting 21 September 2018 12 Water And Waste Committee Meeting 13 September 2018 Adopted Report

ITEM 1 (Continued) WATER AND WASTE COMMITTEE ACTION LIST AND FORWARD PLANNING SCHEDULE CM787/788/06/01(P1)

Proposed Date Subject Action Action Officers

December 2018 2017 Customer Satisfaction Survey Carley That the Director prepare a report for the public related to the Recommendation: WW18.0823.006 Freeman/ customer satisfaction survey. Chris Owen

Approx. Customer Hardship and Assistance Chris Owen That the Director Water and Waste investigate, along with March 2019 Programs the rest of Council, the potential framework for improving Recommendation: WW18.0823.005 Customer Hardship and Assistance Programs.

Approx. Water and Sewerage Asset Marc Avery/ That a report regarding private Water and Sewerage Asset Feb/March 2019 Management Karen O’Brien Management be prepared and returned to Water and Waste Recommendation: WW18.0823.007 committee for review.

RECOMMENDATION

It is recommended that Council resolve as follows: That the Action List and Forward Planning Schedule for Water and Waste Committee be noted.

Authorised by: Paul Heaton iSPOT#37409759 Director Water and Waste

COMMITTEE RECOMMENDATION WW18.0913.001 moved Cr PJ Young seconded Cr Boulton

That the Action List and Forward Planning Schedule for Water and Waste Committee be noted.

CARRIED

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ITEM 2 WATER AND WASTE WATER AND WASTE ANNUAL REGISTER OF COUNCIL DIRECTIONS WSS1125/1227/02(P1)

STANDING AGENDA ITEM: Committee Recommendation: WS14.0430.007 / Council Resolution: G14.0506.025

“That Gold Coast Water establish a standing item on the Water Services Committee Agenda which is a register (and thus an agreed record) of any “directions” that Council gives Gold Coast Water for reporting in the annual operations report.”

That is: - a resolution that goes against or substantially modifies the recommendations of the Officers and; - has a (or potential to have a) material/commercial impact on the business unit.

Council Council Description 2017-18 2018-19 Meeting Resolution progressive 686 G14.0916.004 That the adopted infrastructure charges are adjusted so that there is a 100% Nil Nil to date discount for family accommodation dwellings of 100m2 GFA or less for any approvals issued on or after 1 July 2014 through the remainder of this Council’s term. Permanent changes to Adopted Infrastructure Charges Resolution (AICR): 1. Existing building: no infrastructure charges levied for any change in non-residential land use (ongoing). 2. Expansion: for non-residential land uses, up to an additional 50 per cent of GFA or a maximum of 500m², whichever is the lower, will be exempt from infrastructure charges (ongoing). 3. Family accommodation: no charge for family accommodation dwellings of 100m² GFA or less. Family accommodation dwellings greater than 100m² GFA will be charged at 40 per cent of the relevant AICR charge (ongoing). 4. Not-for-profit community groups: rebates for the water and wastewater networks will be restored, following the return of responsibility to the City (ongoing). Recommendation: WW16.12.05.003 Resolution: G16.1207.018

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ITEM 2 (Continued) WATER AND WASTE ANNUAL REGISTER OF COUNCIL DIRECTIONS WSS1125/1227/02(P1)

RECOMMENDATION

It is recommended that Council resolve as follows:

That the Water and Waste Annual Register of Council Directions be noted.

Authorised by: Paul Heaton iSPOT#43956542 Director Water and Waste

COMMITTEE RECOMMENDATION WW18.0913.002 moved Cr PJ Young seconded Cr Boulton

That the Water and Waste Annual Register of Council Directions be noted.

CARRIED

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ITEM 3 WATER AND WASTE WATER AND SEWERAGE SERVICES PERFORMANCE AS AT 30 JUNE 2018 FN334/252/18(P9) Attachment 1: Income Statement and Notes Attachment 2: Detailed Income Statement - Cash Attachment 3: Status Update – Major Capital Projects Attachment 4: Concealed Leakage Remission Payments 2017-18, by Suburb (Top 20) Attachment 5: Concealed Leakage Remissions > $10,000 - CONFIDENTIAL

1 BASIS FOR CONFIDENTIALITY

Not Applicable.

2 EXECUTIVE SUMMARY

Not Applicable.

3 PURPOSE OF REPORT

The purpose of this report is to provide the Water and Waste Committee with results of Water and Sewerage Services financial performance for the 2017-18 financial year. Within the report, the “revised budget” refers to the March 2018 Budget Review.

4 PREVIOUS RESOLUTIONS

EX MINUTE NO G17.0619.001

The City’s 2017-18 Budget was adopted by Council at the Budget Meeting held on 19 June 2017.

EX MINUTE NO B17.0911.003, in part

7. That the net result for Water and Sewerage Services and Waste Management be transferred to reserves as follows:

a $3,757,314 be transferred to the Water and Sewerage Infrastructure Reserve b $2,108,790 be paid as a special dividend from Water and Sewerage Services to consolidated revenue; and c $4,145,412 be transferred to the Waste Management Reserve.

EX MINUTE NO B17.1207.003, in part

1 That Council approve the net increase of $2.3 million to be transferred to the Waste Management Reserve.

2 That Council note budget variations per Attachments 2 and 3 are included in the September 2017 Budget Review. CARRIED

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ITEM 3 (Continued) WATER AND SEWERAGE SERVICES PERFORMANCE AS AT 30 JUNE 2018 FN334/252/18(P9)

EX MINUTE NO G18.0612.007, in part

3. That Council approve and adopt the following additional net transfers to reserves totalling $24,422,757: a $572,205 to the Centre Improvement Program Reserve b $2,380,206 from the Commonwealth Games Reserve and that this Reserve be closed; c $300,000 to the Cultural Precinct Reserve; d $103,000 to the Open Space Reserve; e $840,695 to the Strategic Priority Reserve; f $28,000 from the Tourist Parks Reserve; g $3,675,125 to the Waste Management Reserve; h $8,535,549 to the Water and Sewerage Infrastructure Reserve (including $1m from Commonwealth Games Reserve for ESD Carrara recycled water project); i $50,273 to the Gold Coast Investment Fund Reserve j $12,753,846 to the Infrastructure Charges Reserve; CARRIED UNANIMOUSLY

5 DISCUSSION

The Water and Waste (WW) Directorate is responsible for two of the City’s commercial business units as defined in the Local Government Regulation 2012, Gold Coast Water (GCW) and Gold Coast Waste Management (GCWM).

GCW is responsible for water, sewerage and recycled water services across the City.

While GCW is a commercial business unit within Council, it is required to comply with the requirements applicable to Distributor-Retail water businesses under the South East Queensland Water (Distribution and Retail Restructuring) Act 2009 and the Local Government Act (2009).

This report outlines the performance for the GCW commercial business unit which, for the purposes of this report, is known as Water and Sewerage Services.

5.1 Water and Sewerage Services High Level Financial Summary

The table below provides a summary of Water and Sewerage Services’ financial performance for 2017-18.

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ITEM 3 (Continued) WATER AND SEWERAGE SERVICES PERFORMANCE AS AT 30 JUNE 2018 FN334/252/18(P9)

Summary Financial Management 2017-18 Revised 2016-17 Variance Statement Actuals Budget Actuals 30 June 2018 $M $M $M % $M Operating Revenue 511.44 511.34 0.11 0.0% 497.60 Flow -Dependant Expenditure 192.52 196.06 3.54 1.8% 188.22 Controllable Expenses 109.69 109.31 (0.37) (0.3%) 105.21 Operating Result 209.24 205.96 3.27 1.6% 204.17 Loss on Sale of Assets 4.38 5.00 0.62 12.5% 4.98 Net Profit before Capital Revenue 204.86 200.96 3.90 1.9% 199.19 Capital Revenue 108.99 85.13 23.86 28.0% 113.85 Depreciation / Amortisation 94.83 92.00 (2.83) (3.1%) 93.31 Earnings Before Interest and Taxation 219.02 194.09 24.93 12.8% 219.73 Interest Expense (QTC loan) 2.80 2.80 0.00 0.0% 3.07 Interest Margin Expense 0.88 0.88 (0.00) (0.0%) 0.88 Shareholder Interest Expense 88.82 88.82 0.00 0.0% 80.37 Income Tax Equivalents 41.70 39.18 (2.52) (6.4%) 42.07 Net Profit After Taxation 84.82 62.41 22.41 35.9% 93.34 Contribution to Whole of City projects 3.50 3.50 0.00 0.0% 2.11 Retained Earnings 81.32 58.91 22.41 38.0% 91.23 Table 1: Gold Coast Water – Summary Financial Management Statement – For year ended 30 June 2018

Net Profit before Capital Revenue is 1.9% ($3.9 million) higher than revised projections, with Earnings before Interest and Taxation (EBIT) 12.8% ($24.9 million) higher than revised projections.

This significant variance in EBIT is due to Contributed Assets being $19.5 million higher than revised projections and Developer Contributions being $4.4 million higher than revised projections.

Income Tax Equivalents paid to the City is $2.5 million above projections due to Flow Dependant Expenditure and Developer Contributions favourable variances against the revised projections.

5.2 Distribution of Earnings

Water and Sewerage Services Earnings before Interest and Taxation (EBIT) for the period ended 30 June 2018, on a cash basis, is $271.8 million (operating revenue of $511.4 million, cash capital revenues of $59.5 million less operating expenditure of $299.1 million). This result exceeds the target set at the March 2018 Budget Review by 3.1% ($8.2 million) and is 1.3% ($3.5 million) higher than the 2016-17 result.

Table 2 below outlines the distribution of 2017-18 earnings. The final position results in Total Transfers to Reserves of $69.4 million. These funds are being accumulated for future years’ water and sewerage capital investment program.

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ITEM 3 (Continued) WATER AND SEWERAGE SERVICES PERFORMANCE AS AT 30 JUNE 2018 FN334/252/18(P9)

2017-18 Revised 2016-17 Distribution of Earnings Variance Actuals Budget Actuals 30 June 2018 $M $M $M % $M Interest Expense (External) 2.80 2.80 (0.00) (0.0%) 3.07 Principal Repayment (External) 4.40 4.40 0.00 0.0% 4.13 Debt Service Payment 7.20 7.20 (0.00) (0.0%) 7.20 Capital Expenditure 60.31 67.73 7.42 11.0% 66.07 Capital Expenditure 60.31 67.73 7.42 11.0% 66.07 Interest Returned - Community Investment in GCW 88.82 88.82 0.00 0.0% 80.37 Tax Equivalents (30% taxable earnings) 41.70 39.18 (2.52) (6.4%) 42.07 Contribution to Whole of City projects 3.50 3.50 0.00 0.0% 2.11 Participation Return 0.00 0.00 0.00 0.0% 0.00 Interest Expense Margin 0.88 0.88 (0.00) (0.0%) 0.88

Payment to Council 134.90 132.39 (2.52) (1.9%) 125.44 (Excluding SLA, Fleet & Plant and Land Tax)

Retained Earnings for future GCW Capital Works Investment 19.96 14.99 (4.97) (33.2%) 27.57 Developer Contributions received, but not utilised 49.43 41.30 (8.14) (19.7%) 42.02 Total Transfers to Reserve 69.39 56.28 (13.11) (23.3%) 69.59

Total Distribution 271.80 263.59 (8.21) (3.1%) 268.29 Table 2: Water and Sewerage Services – Distribution of Earnings –Year Ended 30 June 2018

5.3 Economic Regulation

The price monitoring framework that was undertaken by the Queensland Competition Authority (QCA) ended on 30 June 2015. A draft framework was proposed by the QCA however was not adopted by Government.

Water and Waste officers continue to engage with the other South East Queensland Distributor Retailers and the State Government on development of an effective long-term regulatory framework.

While a framework is currently not in place, Water and Sewerage Services apply principles of economic regulation by ensuring only prudent and efficient expenditure is incurred.

5.4 Returns to Community

In accordance with the City’s GCW Capital Structure and Community Returns Policy, Water and Sewerage Services operates as a commercial business unit and provides an appropriate return to the community, based on its investment in the business.

Returns paid to the City for 2017-18 exceeded the target set at the March 2018 Budget Review by $2.3 million and are outlined in the Table 3. Total payments to the City exceeded the March 2018 budget review target by $2.71 million.

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ITEM 3 (Continued) WATER AND SEWERAGE SERVICES PERFORMANCE AS AT 30 JUNE 2018 FN334/252/18(P9)

2017-18 Revised 2016-17 Community Returns Variance Actuals Budget Actuals 30 June 2018 $M $M $M % $M Interest Margin Expense 0.88 0.88 0.00 0.0% 0.88 Shareholder Interest 88.82 88.82 0.00 0.0% 80.37 Income Tax Equivalents 41.70 39.18 2.52 6.4% 42.07 Land Tax Equivalent 1.32 1.50 (0.18) (12.0%) 1.32 Participation Return 0.00 0.00 0.00 0.0% 0.00 Contribution to Whole of City projects 3.50 3.50 (0.00) (0.0%) 2.11 Return to Community 136.22 133.89 2.34 1.7% 126.76 Table 3: Gold Coast Water – Returns to Community –Year Ended 30 June 2018

The increase in returns was primarily the result of a $2.5 million additional income tax equivalents being provided to the Community.

Total community returns for 2017-18 are $9.5 million (7.5%) higher than the returns provided in 2016-17. This is mostly due to the higher level of Shareholder Interest paid in 2017-18, following a revision of the GCW Capital Structure and Community Returns Policy. The value of annual shareholder interest paid was almost $8.5 million (10.5%) higher in comparison to 2016-17.

5.5 Water and Sewerage Rates Revenue

Gold Coast Water Rates 2017-18 Revised 2016-17 Variance Revenue Actuals Budget Actuals 30 June 2018 $M $M $M % $M Service Charges Water 67.31 66.62 0.69 1.0% 65.79 Sew erage 176.23 174.86 1.36 0.8% 172.36 Total Service Charges 243.54 241.48 2.05 0.8% 238.15 Volumetric Charges Water 213.40 216.67 (3.27) (1.5%) 207.58 Sew erage 39.83 39.02 0.81 2.1% 38.68 Recycled Class A 0.79 0.97 (0.18) (18.8%) 0.98 Less: Concealed Leakage (2.46) (2.50) (0.04) 1.7% (2.35) Total Volumetric Charges 251.56 254.16 (2.60) (1.0%) 244.89

Total Rates Revenue 495.10 495.64 (0.55) (0.1%) 483.04

Table 4: Rates & Charges Revenue –Year Ended 30 June 2018

Total rates revenue received in 2017-18 was $0.6 million (less than 1%) below projections. This revenue comprised:

Service Charges: $2.0 million above revised budget, comprising an additional $0.7 million in water services charges and $1.3 million in sewerage service charges. Both variances are within 1% of the revised budget.

Volumetric Charges: $2.6 million below revised budget due primarily to lower than forecast water charges of $3.3 million, offset by higher sewage charges ($0.8 million). Overall volumetric charges are within 1% of the revised budget.

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ITEM 3 (Continued) WATER AND SEWERAGE SERVICES PERFORMANCE AS AT 30 JUNE 2018 FN334/252/18(P9)

In comparing the actual results against 2016-17:

· service charges received ($243.5 million) were 2.3% higher than those received in 2016-17. · volumetric charges received ($251.6 million) were 2.7% higher than those received in 2016-17.

For the third consecutive year, the City’s has maintained a price freeze on all Council water and sewerage charges. As a result the increase in revenue is solely due to growth in connections and the pass-through of the State Government’s bulk water price increase. This price freeze has continued in the 2018-19 financial year.

Section 5.6.1 provides further information on bulk water demand.

5.5.1 Non-Revenue Water

Reducing the City’s non-revenue water (NRW) is a key focus for the business. A cross branch working group has been established to focus on identification, investigation and rectification of potential losses within the City’s network. Focus areas for the group this year have been: a. Implementation of Takadu, a predictive monitoring tool to assist with water loss monitoring and management. b. Proactive replacement of ageing network flow meters to improve the accuracy of flow data being analysed by Takadu. c. Commissioning of 38 newly establishment Demand Management Areas (DMAs) which will increase the breadth of the network across which we can actively monitor and manage water loss. d. Establishment of a proactive field leak detection team to investigate and repair leaks once located. e. Accelerated meter replacement program to replace aged or slowing meters. f. Delivery of analysis and investigations to identify water theft and metering problems. g. Completion of an end to end review of leak detection to streamline process and improve coordination.

5.5.2 Concealed Leakage Remissions

A total of $2.5 million was paid in concealed leakage remissions for the year, an increase of 5% compared to the $2.3 million paid during 2016-17. While there was an increase in remissions paid in 2017-18, there has been a downward trend from 2013-14 where remissions were in excess of $4 million.

Table 5 below shows that, by number of applications approved, only 15.7% (405 applications) relate to non-residential customers however this equates to 58% of the value of remissions paid.

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ITEM 3 (Continued) WATER AND SEWERAGE SERVICES PERFORMANCE AS AT 30 JUNE 2018 FN334/252/18(P9)

Number Total Leak Water Sewer Total % of Total Average value Approvals Volume Re missions Re missions Re missions of re missions Value ($) Value ($) Value ($) Value ($)

Residential 2,179 549,187 1,038,037 1,038,037 42% 476 Non Residential 405 468,678 641,009 779,232 1,420,241 58% 3,507 2017-18 2,584 1,017,865 1,679,046 779,232 2,458,278 100% 951 Table 5: Concealed Leakage Remissions –Year Ended 30 June 2018

Analysis of leakage remissions indicate that in 2017-18:

· 8% decrease in applications processed (331 applications) for a total of 3,978. · 65% of total applications received a remission (2,584). · 35% of total applications were declined (1,394) compared to 32.4% (1,398) in 2016-17. The most prevalent reason for applications being declined is repairs not being undertaken within the one-month required timeframe. · the highest single remission paid to a customer was $82,815 (entirely Sewer) (2017: $28,847 entirely sewer). · 17% increase in the average value of remissions approved of $950 (2017: $810). Specifically: o residential customers was $476 (2017: $501) o non-residential customers was $3,507 (2017: $2,799).

The following table provides summary information of high level remissions paid during 2017-18. Attachment 4 provides a listing of 2017-18’s “Top 20 Suburbs” by value of concealed leakage remissions payments. A listing of all remissions over $10,000 is provided at Confidential Attachment 5.

Number Total Leak Water Sewer Total Average Approvals Volume Re missions Re missions Re missions value of Value ($) Value ($) Value ($) re missions Remissions greater than $10,000 Non Residential 18 93,711 118,257 133,823 252,080 14,004 Residential 1 5,234 10,059 - 10,059 10,059 Remissions greater than $20,000 19 98,945 128,316 133,823 262,139 13,797 Non Residential 11 117,171 103,618 357,766 461,384 41,944 Table 6: High Value Concealed Leakage Remissions – Year Ended 30 June 2018

A revised leakage remission Policy is currently being drafted and will be submitted to Council for consideration. The revision will incorporate Seqwater’s proposed contribution for a portion of the bulk water component of the concealed leak volume. The revised Policy also aims to align with other concealed leak remission policies in South East Queensland, including more limited remissions for non-residential customers.

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ITEM 3 (Continued) WATER AND SEWERAGE SERVICES PERFORMANCE AS AT 30 JUNE 2018 FN334/252/18(P9)

5.6 Flow-Dependant Expenditure

Water and Sewerage Services flow dependant expenditure was below revised budget by a total of $3.5 million or 1.8%.

Flow-Dependant 2017-18 Revised 2016-17 Variance Expenditure Actuals Budget Actuals 30 June 2018 $M $M $M % $M Bulk Water Purchase 175.66 178.75 3.09 1.7% 171.35 Electricity 9.79 9.94 0.15 1.5% 10.07 Biosolids Disposal 3.78 3.82 0.03 0.9% 3.56 Chemicals 3.29 3.55 0.26 7.4% 3.25 Total Flow-Dependant Expenditu 192.52 196.06 3.54 1.8% 188.22 Table 7: Flow dependent expenditure

5.6.1 Bulk Water Purchases

Total bulk water purchases for 2017-18 was below revised budget by $3.1 million, with demand for the year being 1,119 ML lower than revised forecast. In total, 62,336 ML of bulk water was purchased in 2017-18. This compares to 2016-17 bulk water purchases of 62,340 ML.

As shown in Graph 3 below, demand is generally higher than forecast during months experiencing low rainfall. Rainfall for the 2017-18 year was approximately 59% of the long term average, with 857.8 mm being recorded at the Gold Coast Seaway. This compares to a long term average of 1,445.1mm.

Graph 1: Analysis of Water Supplied versus Demand Forecast * ML supplied as invoiced by the SEQ Water Grid Manager.

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ITEM 3 (Continued) WATER AND SEWERAGE SERVICES PERFORMANCE AS AT 30 JUNE 2018 FN334/252/18(P9)

5.6.2 Chemicals

Chemicals expenditure is $0.3 million below revised budget due to trials of lower magnesium hydroxide dosages within the sewer network.

5.7 Controllable Expenses

Controllable Expenses were within 1% of revised forecast. This is consistent with trends since 2013-14 where controllable expenses have been within 4% of revised budget.

A detailed Income Statement is appended to this report (Attachment 1).

5.8 Capital Revenues and Non-Cash Expenses

5.8.1 Capital Revenues

Contributed assets are 65.0% ($19.5 million) higher than revised projections, with over $49 million in contributed assets being recognised during the year. This is less than the almost $57 million recognised in 2016-17 by 12.5% but substantially higher than the average of the past five years of $30 million.

Developer Contributions are 8.0% ($4.4 million) above revised projections, with over $59 million in developer contributions being recognised during the year. This exceeds the almost $57 million recognised in 2016-17 by 4.8% and is substantially higher than the average of the past five years of $45 million.

The graph below illustrates the high level of capital revenues, both Contributed Assets and Developer (Cash) Contributions that have been received in the past three years and is consistent with the high level of development activity occurring across the City. While the City is experiencing significant development across the City, these levels of capital revenues will not continue over the long term and management of developer contributions is being closely monitored.

80,000

60,000

40,000

20,000

- 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18

Contributed Assets Developer Contributions

Graph 2: Capital Revenues Received 761st Council Meeting 21 September 2018 24 Water And Waste Committee Meeting 13 September 2018 Adopted Report

ITEM 3 (Continued) WATER AND SEWERAGE SERVICES PERFORMANCE AS AT 30 JUNE 2018 FN334/252/18(P9)

5.8.2 Asset Values and Non-Cash Expenses

A total of $3.89 billion (written down replacement cost) of water and sewerage infrastructure assets is managed within the Water and Sewerage Services business unit.

Depreciation expense is $2.8 million or 3.1% above the revised budget and $1.5 million or 1.6% above depreciation expense for 2016-17.

Loss on Disposal of assets was $4.4 million for 2017-18, which compares with $5.0 million in 2016-17. The level of disposal costs incurred in the current year is indicative of expected levels in future years.

5.9 Capital Program

5.9.1 Capital Expenditure

The initial 2017-18 Water and Sewerage Services capital program consisted of 59 projects totalling $75.1 million. The revised budget following the budget reviews during the year was $67.7 million spanning 93 projects.

Water and Sewerage Services Capital Expenditure as at 30 June 2018

2017-18 Revised 2016-17 Variance Variance Product Actuals Budget Actuals ($M) (%) ($M) ($M) ($M) Sewerage 44.71 51.48 6.77 13.1% 51.93 Water 9.69 9.78 0.09 0.9% 11.63 Non-Core Water 6.10 6.38 0.28 4.4% 2.67 Recycled Water 0.00 0.00 0.00 - 0.00 Corporate 0.08 0.08 0.00 0.8% 0.42

Total Capital 60.59 67.73 7.14 10.5% 66.65 Table 8: Capital Expenditure

The final capital expenditure for 2017-18 was $60.6 million which represents a variance of 10.5% against the revised budget of $67.7 million and 19.3% against initial budget of $75.1 million. The main contributor to this variance is the Long Term Recycled Water Release Plan which deferred $18.05 million to 2018-19 due to delays in contract award until June 2018, resulting from a change in the construction methodology from dredged to trenchless for the marine crossings in order to comply with stringent conditions of approval set by Regulators.

Refer to Attachment 3 for a status update of major capital investment projects.

5.9.2 Capital Program Achievements

Forty-five capital works projects were completed in the 2017-18 financial year. Some of the significant projects completed are outlined in table 9 below.

761st Council Meeting 21 September 2018 25 Water And Waste Committee Meeting 13 September 2018 Adopted Report

ITEM 3 (Continued) WATER AND SEWERAGE SERVICES PERFORMANCE AS AT 30 JUNE 2018 FN334/252/18(P9)

TOTAL 2017-18 FY PROJECT PROJECT EXPENDITURE EPENDITURE Benowa A102 Sewer Rising Main Stage 1 6,423,800 7,001,374 SPS Mech Elec Major Renewals 2016-18 3,001,433 8,450,599 Water Meter Replacements 2017-18 2,866,059 2,866,059 STP Switchboard Replacement 1,938,565 4,518,725 Reservoir Priority Roof 1,405,684 2,190,785 Reservoir Roof Refurbishment Program 2016-17 1,331,885 1,610,260 Gainsborough Greens - Lift Stations and 450mm Sewer Trunk Main 1,326,077 1,326,077 Sewer Maintenance Hole Rehabilitation 2017-18 1,110,652 1,110,652 SPS Civil Renewals Project 2017-18 900,231 900,231 Proactive Water Service Replacements 2017-18 895,186 895,186 Sewage Treatment Plant Civil Renewals Project 2017-18 858,796 858,796 CWG Sewer Maintenance Holes 16-17 & 17-18 680,533 1,646,784 OX33 Vacuum Sewage Access Pits Upgrade 573,788 727,107 Hydrant Replacements 2017-18 573,224 573,224

Sub Total (Significant Projects) 23,885,910 34,675,857

Other Completed Projects 3,801,951 24,431,239 Total 27,687,861 59,107,095 Table 9: Significant Capital Projects Completed

5.9.3 Assets under Construction (AuC)

At 30 June 2018, total Assets under Construction (AuC) balance is $99.25 million, which includes 94 capital projects. The table below shows the movement of AuC balances since the return to Council, in comparison to the capital spend each year.

Asse ts unde r Capital Spend AuC Balance Construction ($M) ($M)

1 July 2012 0.00 125.86

30 June 2013 59.28 69.70

30 June 2014 46.96 70.20

30 June 2015 34.17 53.15

30 June 2016 51.81 75.45

30 June 2017 66.65 80.42

30 June 2018 60.59 99.25

Table 10: Closing Balances – Assets under Construction (AuC)

The construction of infrastructure assets can extend over multiple financial years and WW strives for timely processing of all funds expended, once assets are “in service” and able to recognised within the City’s financial asset register.

This is not only to ensure that assets are recorded in the system for customer and maintenance purposes but also for compliance with the Australian Accounting Standards and to ensure the Regulatory Asset Base (RAB) is appropriately maintained for regulatory and pricing purposes.

761st Council Meeting 21 September 2018 26 Water And Waste Committee Meeting 13 September 2018 Adopted Report

ITEM 3 (Continued) WATER AND SEWERAGE SERVICES PERFORMANCE AS AT 30 JUNE 2018 FN334/252/18(P9)

5.10 Other Financial Activities

5.10.1 Procurement Savings

In April 2017 (GA17.0419.007), Council resolved as follows:

“That effective from 1 July 2017, the current model of procurements savings being a separate component of the cash surplus target required to underpin the budget each year be discontinued, however the corporate (overall) budget surplus target be retained”.

Whilst no longer reflected as a separately identifiable component, Water and Waste’s budget process continues to incorporate a total review of all operating costs, identifying any potential savings or efficiencies, and all capital works estimates, addressing actual contract costs.

5.10.2 Community Service Obligations

In accordance with Sections 23 and 24 of the Local Government Regulation 2012:

…The cost of carrying out community service obligations, less any revenue received from performing the obligations, must be treated as revenue for the significant business activity. {Section 23} (and)

…A community service obligation is an obligation the local government imposes on a business entity to do something that is not in the commercial interests of the business entity to do.

Example of a community service obligation – giving a price concession to a particular group of customers, including pensioners, seniors and students {Section 24}

For the 2017-18 year, no water or sewerage infrastructure charges have been recorded as foregone under the City’s rebates provided for Non-Profit Community Groups (2016-17: $0.18 million).

$1.4 million in potential credits available has been identified in Table 11 (below) for Development Applications that have been approved during 2017-18. This compares to a total of $2.2 million identified for Development Applications that were approved during 2016-17.

The realisation of these potential credits will only occur once the development actually proceeds on the basis approved.

POTENTIAL CREDITS AVAILABLE ($'000) Water Sewer Total 5.1 Exemption Credit 234.98 717.73 952.72 5.2 Exemption Credit 74.02 214.93 288.96 5.4 Exemption (Secondary dwelling) 7.50 23.11 30.61 Family Accommodation < 100m2 17.64 54.38 72.01 Parking Station Exemption Credit 20.86 64.29 85.14 TOTAL POTENTIAL CREDITS 355.00 1,074.44 1,429.44

2016-17 Comparison (Totals) 530.40 1,587.00 2,117.40 Table 12: Potential Infrastructure Credits for Development Applications approved during 2017-18

To date, no Community Service Obligations have been formally recognised for these Rebates and Credits. 761st Council Meeting 21 September 2018 27 Water And Waste Committee Meeting 13 September 2018 Adopted Report

ITEM 3 (Continued) WATER AND SEWERAGE SERVICES PERFORMANCE AS AT 30 JUNE 2018 FN334/252/18(P9)

5.10.3 Community Service Obligations – Catchment Management Unit

The Catchment Management Unit transferred to Water and Waste, effective 1 July 2016. This activity protects human health in recreational waters by monitoring the state of the City’s water environments and providing rapid reporting of the health status of primary contact recreation areas. It supports the maintenance of legislated environmental values in the City’s water environments through catchment and stormwater planning and implementation of appropriate environmental restoration actions.

These activities are funded by way of a Community Service Obligation (CSO). At adoption of Council’s initial budget, the total value of this CSO was $4,465,110. Following expenditure deferrals of $850,000 and re-provisions of $83,965 from 2016-17, the total value of proposed expenditure on Catchment Management activities for 2017-18 is $5,399,075.

As shown in Table 13 (below), operational business as usual activities for the Catchment Management Unit are ongoing, with expenditure for those activities for the year being 4.5% ($0.19 million) below budget. Expenditure on water testing and monitoring and the Albert River catchment rehabilitation program have been lower than forecast. Reprovision of funds totalling $0.18 million has been requested to finalise testing and monitoring projects commenced in 2017-18.

Catchment Management 2017-18 Revised Variance Unit - Operational Actuals Budget $M $M $M % CMU Operations 0.83 0.91 0.09 9.3% Catchment Activities 1.74 1.55 (0.19) (12.1%) Healthy Waterw ays Contribution 0.32 0.32 0.00 0.0% WaterSafe Monitoring & Investigation 0.15 0.32 0.18 54.3% Laboratory Testing Services 0.38 0.50 0.12 23.9% Non-Capped Capital 0.06 0.04 (0.03) (76.8%) Water Cycle Implementation 0.09 0.11 0.02 21.9% SLA for Corporate Services 0.42 0.42 0.00 0.0% Total CMU - Operational 3.99 4.17 0.19 4.5% Table 13: Summary of Catchment Management Unit – Operational Expenses

The only capital works project undertaken during 2017-18 was to provide foreshore stabilisation around the lake within Damian Leeding Memorial Park. This project continued from the 2016-17 financial year and budget totalling $916,568 was deferred from 2016-17 for this purpose. An increase for this project of $0.38 million was approved in the September budget review due to contract prices being higher than estimate. In the March review this budget was reduced by $0.08 million, bringing the total budget for the project to $1.23 million. This project is now complete.

Catchment Management 2017-18 Revised Variance Unit - Capital Actuals Budget $M $M $M % Damian Leeding Foreshore Stabilisati 1.23 1.23 (0.01) (0.5%) Sub-Total 1.23 1.23 (0.01) (0.5%) Table 14: Summary of Catchment Management Unit – Capital Expenditure

761st Council Meeting 21 September 2018 28 Water And Waste Committee Meeting 13 September 2018 Adopted Report

ITEM 3 (Continued) WATER AND SEWERAGE SERVICES PERFORMANCE AS AT 30 JUNE 2018 FN334/252/18(P9)

5.11 Reserve Balances

5.11.1 Water and Sewerage Infrastructure Reserve

Cash surpluses from operations are transferred to the Water and Sewerage Infrastructure Reserve. These cash reserves are set aside for future investment in water and sewerage infrastructure. A capital program totalling in excess of $1.5 billion is projected over the next ten years.

With the movements processed as part of the 2017-18 year-end review, the reserve balance, as at 30 June 2018 will be $181.9 million.

5.11.2 Infrastructure Charges Reserve

Infrastructure Charges may only be utilised to fund growth-related infrastructure assets. Receipts of Infrastructure Charges have significantly exceeded expectations over the past three years. As at 30 June 2018, the balance of funds held in the Water and Sewerage Infrastructure Charges Reserves is $204.1 million.

Infrastructure Charges that cannot be utilised in the current year are retained within the City’s Infrastructure Charges Reserves to be utilised for funding of growth-related assets in future years.

Based on current projections, infrastructure charges reserves will be exhausted within the next ten years to assist with funding of growth-related projects scheduled over that timeframe.

6 ALIGNMENT TO THE CORPORATE PLAN, CORPORATE STRATEGIES AND OPERATIONAL PLAN

Not Applicable.

7 FUNDING AND RESOURCING REQUIREMENTS

Not Applicable.

8 RISK MANAGEMENT

The following Corproate risk applies to this report:

Risk Number Description

Risk No. CO000435 Failure to achieve a sustainable long term financial position leading to negative impacts on Council’s ability to deliver on its key focus area commitments.

761st Council Meeting 21 September 2018 29 Water And Waste Committee Meeting 13 September 2018 Adopted Report

ITEM 3 (Continued) WATER AND SEWERAGE SERVICES PERFORMANCE AS AT 30 JUNE 2018 FN334/252/18(P9)

9 STATUTORY MATTERS

Not Applicable.

10 COUNCIL POLICIES § Gold Coast Water Capital Structure and Community Returns Policy § Revenue Policy § Gold Coast City Council Budget Review Policy § Water and Sewage Leakage Relief Policy

11 DELEGATIONS

Not Applicable.

12 COORDINATION AND CONSULTATION

Name and/or Title of the Directorate or Is the Stakeholder Satisfied Stakeholder Consulted Organisation With Content of Report and Recommendations (Yes/No) (comment as appropriate) Marilyn Hildebrandt Executive Coordinator – Office of the COO Yes Directorate Finances Chris Owen Manager Customer Water and Waste Yes Engagement Alan Whyte Manager Network Water and Waste Yes Reliability

13 STAKEHOLDER IMPACTS

Not Applicable.

14 TIMING

Not Applicable.

761st Council Meeting 21 September 2018 30 Water And Waste Committee Meeting 13 September 2018 Adopted Report

ITEM 3 (Continued) WATER AND SEWERAGE SERVICES PERFORMANCE AS AT 30 JUNE 2018 FN334/252/18(P9)

15 CONCLUSION

Water and Waste comprises two commercial business units within the City of Gold Coast. Water and Sewerage Services operates in accordance with the requirements of the Local Government Act 2009 and the South East Queensland Water (Distribution and Retail Restructuring) Act 2009 and provides an appropriate return to the community on its investment in the business.

As a monopoly service provider, Water and Sewerage Services operates within a regulatory framework that comprises an economic regulator and a number of technical regulators.

For 2017-18, total returns to the community of $136.2 million were achieved. This result is 1.7% ($2.3 million) greater than March 2018 budget review projections. This increase in returns is primarily the result of additional income tax equivalents payable to the City.

The final result of the year’s operations has provided returns to the community as set out in Table 15 (below):

2017-18 Revised 2016-17 Community Returns Variance Actuals Budget Actuals 30 June 2018 $M $M $M % $M Interest Margin Expense 0.88 0.88 0.00 0.0% 0.88 Shareholder Interest 88.82 88.82 0.00 0.0% 80.37 Income Tax Equivalents 41.70 39.18 2.52 6.4% 42.07 Land Tax Equivalent 1.32 1.50 (0.18) (12.0%) 1.32 Participation Return 0.00 0.00 0.00 0.0% 0.00 Contribution to Whole of City projects 3.50 3.50 (0.00) (0.0%) 2.11 Return to Community 136.22 133.89 2.34 1.7% 126.76 SLA Costs 18.72 18.72 (0.00) (0.0%) 18.97 Health Monitoring Costs 0.00 0.00 0.00 0.0% 0.00 Insurance Premiums 1.82 1.82 0.00 0.0% 1.85 Fleet & Plant Charges 4.48 4.11 0.37 8.9% 4.49 Total Payments to Council 161.24 158.54 2.71 1.7% 152.06 Table 15: WW Returns to Community – For the year ended 30 June 2018

16 RECOMMENDATION

It is recommended that Council resolves as follows:

1 That Attachment 5 be deemed non-confidential except for those parts deemed by the Chief Executive Officer to remain confidential in accordance with sections 171 (3) and 200 (5) of the Local Government Act 2009”

2 That Council note the Water and Sewerage Services Financial Performance Report for the 2017-18 financial year.

Author: Authorised by: Karen O’Brien Paul Heaton Manager Business Performance Director Water and Waste 3 September 2018 TRACKS REF: 71488073

761st Council Meeting 21 September 2018 31 Water And Waste Committee Meeting 13 September 2018 Adopted Report

ITEM 3 (Continued) WATER AND SEWERAGE SERVICES PERFORMANCE AS AT 30 JUNE 2018 FN334/252/18(P9)

COMMITTEE RECOMMENDATION WW18.0913.003 moved Cr PJ Young seconded Cr Boulton

2 That Council note the Water and Sewerage Services Financial Performance Report for the 2017-18 financial year.

CARRIED

761st Council Meeting 21 September 2018 32 Water And Waste Committee Meeting 13 September 2018 Adopted Report

Attachment 3.1 Attachment 1: Detailed Income Statement - Accrual

Water and Sewerage Services 2017-18 Revised Financial Management Actuals Budget Variance Statement 30 June 2018 $M $M $M % Revenue Service Charges 243.54 241.48 2.05 0.8% Volumetric Charges 254.02 256.66 (2.64) (1.0%) Less: Concealed Leakage (2.46) (2.50) (0.04) 1.7% Interest on Outstanding Rates 2.11 1.90 0.21 11.0% Interest on Investments 8.84 8.84 0.00 0.0% Fees and Charges 5.40 4.96 0.44 9.0% Total Operating Revenue 511.44 511.34 0.11 0.0% Operating Expenditure FLOW-DEPENDA NT EXPENDITURE Bulk Water Purchases 175.66 178.75 3.09 1.7% Electricity 9.79 9.94 0.15 1.5% Biosolids Disposal 3.78 3.82 0.03 0.9% Chemicals 3.29 3.55 0.26 7.4% Total Flow-Dependant Expenditure 192.52 196.06 3.54 1.8%

Operating Revenue net of Flow- Dependant Expenditure 318.92 315.28 (3.65) (1.2%) Gross Margin

CONTROLLA BLE EXPENDITURE Employee Expenses 48.83 49.11 0.27 0.6% Materials and Services 24.12 23.30 (0.82) (3.5%) Council Corporate SLAs 18.72 18.72 0.00 0.0% Internal Directorate SLA (2.74) (3.28) (0.54) 16.4% Fleet and Plant 9.22 8.66 (0.56) (6.5%) Sew age Treatment Charge 3.39 3.42 0.02 0.7% Insurance Premiums 1.82 1.82 - 0.0% Other Expenditure 5.01 5.00 (0.01) (0.2%) Consultants 1.28 2.30 1.02 44.5% Regulatory Expenses 0.04 0.27 0.23 85.7% Total Controllable Expenditure 109.69 109.31 (0.37) (0.3%) Total Operating Expenditure 302.21 305.37 3.16 1.0%

Loss on Sale of Assets 4.38 5.00 0.62 12.5%

Net Profit before Capital Revenue 204.86 200.96 (3.90) (1.9%)

Capital Revenue Developers Contributions 59.41 55.00 4.41 8.0% Contributions and Donations Received 0.06 0.13 (0.06) (49.5%) Contributed Assets 49.51 30.00 19.51 65.0% Total Capital Revenue 108.99 85.13 23.86 28.0%

EBITDA 313.85 286.09 27.76 9.7%

Depreciation 94.83 92.00 2.83 3.1%

EBIT 219.02 194.09 24.93 12.8% Interest Expense (QTC Loan) 2.80 2.80 (0.00) (0.0%) Interest Margin Expense 0.88 0.88 0.00 0.0% Shareholder Interest Expense 88.82 88.82 - 0.0% Income Tax Equivalents 41.70 39.18 2.52 6.4% NPAT 84.82 62.41 22.41 35.9%

Contribution - Whole of City projects 3.50 3.50 - 0.0% Participation Return 0.00 0.00 - 0.0%

Retained earnings impact after participation return 81.32 58.91 22.41 38.0%

761st Council Meeting 21 September 2018 33 Water And Waste Committee Meeting 13 September 2018 Adopted Report

Attachment 3.2 Attachment 2: Detailed Income Statement - Cash

Water and Sewerage Services 2017-18 Revised Financial Management Statement Actuals Budget Variance {Cash} 30 June 2018 $M $M $M % Operating Revenue Service Charges 243.54 241.48 2.05 0.8% Volumetric Charges 254.02 256.66 (2.64) (1.0%) Less: Concealed Leakage (2.46) (2.50) (0.04) 1.7% Interest on Outstanding Rates 2.11 1.90 0.21 11.0% Interest on Investments 8.84 8.84 0.00 0.0% Other Operating Income 5.40 4.96 0.44 9.0% Total Operating Revenue 511.44 511.34 0.11 0.0%

Flow-Dependant Expenditure Bulk Water Purchase 175.66 178.75 3.09 1.7% Electricity 9.79 9.94 0.15 1.5% Biosolids Disposal 3.78 3.82 0.03 0.9% Chemicals 3.29 3.55 0.26 7.4% Total Flow-Dependant Expenditure 192.52 196.06 3.54 1.8%

Operating Revenue net of Flow- Dependant Expenditure 318.92 315.28 3.65 1.2%

Controllable Expenses Employee Expenses 48.83 49.11 0.27 0.6% Materials and Services 24.12 23.30 (0.82) (3.5%) Council Corporate SLAs 18.72 18.72 (0.00) (0.0%) Internal Directorate SLA (2.74) (3.28) (0.54) 16.4% Fleet and Plant 9.22 8.66 (0.56) (6.5%) Sew age Treatment Charge 3.39 3.42 0.02 0.7% Insurance Premiums 1.82 1.82 - 0.0% Other Expenditure 1.92 2.50 0.58 23.0% Consultants 1.28 2.30 1.02 44.5% Regulatory Expenses 0.04 0.27 0.23 85.7% Total Controllable Expenses 106.60 106.81 0.21 0.2% Total Operating Expenses 299.12 302.87 3.75 1.2%

Net Profit before Capital Revenue 212.32 208.46 3.86 1.9%

Capital Revenue Developer Contributions Funding 59.41 55.00 4.41 8.0% Contribution / Donations Received (Capital) 0.06 0.13 (0.06) (49.5%) Reserve Funding 0.00 0.00 - 0.0% Total Capital Revenue 59.48 55.13 4.35 7.9%

EBIT 271.80 263.59 (8.21) (3.1%) Interest Expense (QTC loan) 2.80 2.80 (0.00) (0.0%) Interest Margin Expense 0.88 0.88 (0.00) (0.0%) Shareholder Interest Expense 88.82 88.82 - 0.0% Income Tax Equivalents 41.70 39.18 (2.52) (6.4%) NPAT 137.60 131.91 5.69 4.3%

Contribution - Whole of City projects 3.50 3.50 0.00 0.0% Participation Return 0.00 0.00 - 0.0% Less Developer Conts Revenue 59.41 55.00 (4.41) (8.0%) Plus Developers Conts Funding (9.98) (13.71) (3.72) 27.2% Debt Redemption 4.40 4.40 0.00 0.0% Capital Expenditure 60.31 67.73 7.42 11.0%

Transfer to Reserves 19.96 14.99 4.97 33.2%

761st Council Meeting 21 September 2018 34 Water And Waste Committee Meeting 13 September 2018 Adopted Report

Attachment 3.3.1

Attachment 3: Status Update – Major Capital Projects

Long Term Recycled Water Release

Project scope and budget

The City’s existing excess recycled water release system at the Seaway is nearing capacity. The Long Term Recycled Water Release Plan aims to provide a city wide solution to cater for excess recycled water in both average dry weather and peak wet weather flows. Stage 1 consists of infrastructure upgrades at Coombabah Sewage Treatment Plant, Benowa Repump Station and the marine crossings of the Broadwater and Nerang River.

The initial budget for 2017-18 was $22.8 million. Budget reductions totalling $18.05 million for the 2017-18 financial year were approved due to delays in contract award until June 2018 resulting from a change in the construction methodology from dredged to trenchless for the marine crossings in order to comply with stringent conditions of approval set by Regulators. Construction will commence in 2018-19 with an expected completion date of June 2020.

· September Budget Review $11.80 million decrease · March Budget Review $ 6.25 million decrease

Achievements for 2017-18

· An alternative trenchless option for the marine crossing works was pursued and endorsed by the Project Control Group. · An Early Works Agreement was negotiated with the preferred tenderer to obtain additional geotechnical information for the Broadwater and Nerang River informing the feasibility of the proposed trenchless construction methodology. · Regulatory authorities’ approvals were obtained for the alternative trenchless construction methodology. · Discussions with the preferred tenderer were finalised with the inclusion of the trenchless marine crossings and additional construction methodology risks identified. · A report recommending award of a Contract was presented to Water and Waste Committee. This was approved and a contract was executed.

Major issues

The revised alternative trenchless construction methodology delayed the delivery of the programme. The marine crossings are the most technically challenging part of the project given the diameters and lengths involved and their management and delivery will be continuously monitored.

Financial Performance

Year to Date Whole Project Forecast ($) 4,750,000 Budget ($) 80,181,580 Expenditure ($) 4,416,564 ITD Expenditure ($) 9,548,145 Variance ($) 333,435 Remaining ($) 70,633,435

Variance (%) 7% Remaining (%) 88%

761st Council Meeting 21 September 2018 35 Water And Waste Committee Meeting 13 September 2018 Adopted Report

Attachment 3.3.2

Benowa A102 Sewer Rising Main Stage 1

Project scope and budget

This project aims to provide flexibility in the operations of the southern portion of the Eastern and Western Force Main and to provide the ability to efficiently and economically maintain the main. This project will provide adequate sewage system infrastructure to support system operations leading up to and after the Commonwealth Games, provide the ability to shutdown the A102 sewerage rising main for up to 24 hours to facilitate emergency repairs, new construction or downtime during sustained power outages and provide infrastructure that is resilient and provides flexibility for system operations.

The initial budget for 2017-18 was $5.52 million. Budget increases totalling $0.90 million for the 2017-18 financial year were approved resulting from construction costs higher than business case estimate. This project is complete.

· September Budget Review $0.90 million increase · March Budget Review No change

Achievements for 2017-18

· Construction and commission of 1.65 kilometres of 800mm Polyethylene pipeline completed. · Site reinstatement completed and twelve months defects liability period has commenced.

Major issues

Construction equipment failures during horizontal directional drilling beneath the Benowa flood channel delayed the commissioning of the new main.

Financial Performance

Year to Date Whole Project Forecast ($) 6,422,000 Budget ($) 6,980,035 Expenditure ($) 6,423,800 ITD Expenditure ($) 6,981,834 Variance ($) (1,800) Remaining ($) (1,800)

Variance (%) (0%) Remaining (%) (0%)

761st Council Meeting 21 September 2018 36 Water And Waste Committee Meeting 13 September 2018 Adopted Report

Attachment 3.3.3 Sewerage Pumping Station Emergency Storage Augmentations

Project scope and budget

This project comprises emergency storage augmentations for Sewerage Pumping Stations (SPS) to mitigate deficiencies in situations such as power and pump failure, and provide adequate storage capacity to cater for projected growth over the next 50 years.

This multi-year project includes the detailed design and construction to upgrade 22 SPS’s in the Stapylton, Helensvale, Pimpama, Coombabah and Merrimac East catchments and the Carrara Sports Precinct.

The initial budget for 2017-18 was $3.10 million. Budget increases totalling $0.58 million for 2017-18 were approved resulting from works carrying over from the previous financial year and revised project estimate.

· September Budget Review $0.43 million increase · March Budget Review $0.15 million increase

Achievements for 2017-18

· Easement acquisition for SPS D54 and A56 (The Southport School) completed. · Redesign and construction of new overflow pipe for SPS A56 completed. · The Emergency Storages of the following contracted SPS sites were completed and handed over; o A4, A10, A23, A25, A45, A46, A56, B37, C4, DA01, DA10, D54, MU11, OR02, OX13, PA1, SS6, SS14, SS42, SS65, UC10, W52 · Construction completed of three priority SPS sites - W52, A25 and A45 before Commonwealth Games handover set dates.

Major issues

· Works were delayed at several sites for varying reasons, delaying the timely delivery of the project. · The revised cost estimate was a result of a number of construction issues, including; o Flooding of the excavation pit from nearby existing stormwater system at SPS SS6. o High water table/groundwater levels during construction resulting in more extensive foundation treatments being required than envisaged at detail design stage. o Additional costs for dewatering of treated groundwater at SPS A4 and A25 to comply with the City’s Guidelines for Dewatering Management Plans.

Financial Performance

Year to Date Whole Project Forecast ($) 3,679,000 Budget ($) 5,485,271 Expenditure ($) 3,660,444 ITD Expenditure ($) 5,393,715 Variance ($) 18,555 Remaining ($) 91,555

Variance (%) 1% Remaining (%) 2%

761st Council Meeting 21 September 2018 37 Water And Waste Committee Meeting 13 September 2018 Adopted Report

Attachment 3.3.4

Elanora STP Digester A and Sludge Heater Refurbishment

Project scope and budget

This project includes the refurbishment of digester A and replacement of the non-compliant gas pipework, railings, roof seal and digester heaters at Elanora Sewage Treatment Plant (STP) including opportunistic replacement of internal mechanical, electrical and civil components. The initial budget for 2017-18 was $1.73 million. Budget decreases totalling $1.63 million for 2017-18 were approved resulting from works deferring to future years.

· September Budget Review $0.73 million decrease · March Budget Review $0.90 million decrease

Achievements for 2017-18

· Specification for construction tender completed. · Tender documentation issued to market.

Major issues

Delays experienced in development of the specification due to complexity of works involved and detailed investigation and finalisation of requirements for safety management during construction phase.

Financial Performance

Year to Date Whole Project Forecast ($) 100,000 Budget ($) 423,603 Expenditure ($) 61,295 ITD Expenditure ($) 84,898 Variance ($) 38,705 Remaining ($) 338,705

Variance (%) 39% Remaining (%) 80%

761st Council Meeting 21 September 2018 38 Water And Waste Committee Meeting 13 September 2018 Adopted Report

Attachment 3.3.5

Water Loss Management – Establishment of New District Metered Areas

Project scope and budget

This project involves the design and construction of 40 new District Metered Areas (DMA’s) to increase DMA coverage of the potable water network from 35% to 70% across the City. The increased coverage will provide additional network monitoring and data for focussing active and targeted leak detection in order to deliver repairs and associated leakage reductions.

The initial budget for 2017-18 was $1.24 million. Budget increases totalling $1.60 million for 2017-18 were approved resulting from the revised project estimate.

· September Budget Review $2.06 million increase · March Budget Review $0.46 million decrease

Achievements for 2017-18

· Award of design and construct contract. · Potholing and site service location survey’s completed. · Fabrication of prototype of access lid completed and inspected by stakeholders for acceptance. · Standard DMA design developed and accepted by stakeholders incorporating fall from heights evaluation. · Revised design and construction methodology adopted following investigations into failed connections. · Detailed designs for thirty eight out of the forty sites completed. · Construction and commissioning of thirty five sites completed.

Major issues

· Works at one site were temporarily delayed due to a failed connection of a large diameter trunk main as a result of issues with the temporary thrust restraint and network shutdown failures. · Data logger battery life issues across all DMA sites due to excessive data transfer rates being resolved.

Financial Performance

Year to Date Whole Project Forecast ($) 2,840,000 Budget ($) 4,468,451 Expenditure ($) 2,979,947 ITD Expenditure ($) 3,108,398

Variance ($) (139,947) Remaining ($) 1,360,053

Variance (%) (5%) Remaining (%) 30%

761st Council Meeting 21 September 2018 39 Water And Waste Committee Meeting 13 September 2018 Adopted Report

Attachment 3.3.6

Refurbishment of Process Tanks at Elanora and Coombabah Sewage Treatment Plants

Project scope and budget

This project involves the refurbishment of eight process tanks and three pumping facilities at Elanora and Coombabah Sewage Treatment Plants (STP) including process tank structures and mechanical and electrical components. The assets will be replaced or renewed to “as new” condition in order to comply with operational safety standards and Department of Environment and Science (DES) licence requirements. The construction contract was awarded to Aquatec Maxcon Pty Ltd on 30 June 2015. The need to ensure the treatment plants continue to operate effectively throughout construction adds significant complexity to this project.

The initial budget for 2017-18 was $1.00 million. Budget increases totalling $0.03 million for 2017-18 were approved resulting from the revised project estimate.

· September Budget Review $0.25 million decrease · March Budget Review $0.28 million increase

Achievements for 2017-18

The following components have been refurbished, recommissioned and are back in service:

· Elanora Dissolved Air Flotation Scraper Bridge. · Elanora Return Activated Sludge 1 Pump Station. · Elanora Dissolved Air Flotation Facility including aluminium handrail, kickboard and new supports. · Four large pumps at Elanora Sludge Pump Station. · Coombabah Aerator refurbishment completed with additional strengthening measures implemented. · Elanora Return Activated Sludge 2 Pump Station minor works including laser aligning and impellor replacement of RAS 3 Pump.

Major issues

· Defects were identified with the bearings on the aeration rotors on Coombabah Bioreactor F. Negotiations were undertaken with the contractor and issues were resolved in June. · The lining on the launder channel on Clarifier F at Elanora has blistered and requires full rectification by the Contractor.

Financial Performance

Year to Date Whole Project Forecast ($) 1,025,000 Budget ($) 8,372,880 Expenditure ($) 1,062,784 ITD Expenditure ($) 8,410,664 Variance ($) (37,784) Remaining ($) (37,784)

Variance (%) (4%) Remaining (%) (0%)

761st Council Meeting 21 September 2018 40 Water And Waste Committee Meeting 13 September 2018 Adopted Report

Attachment 3.3.7

Coombabah STP Stage 6 Upgrade

Project scope and budget

This project involves the upgrade of Coombabah Sewage Treatment Plant (STP) to provide additional treatment capacity to cater for growth and meet licence requirements. Coombabah catchment is expected to experience significant growth over the coming years – the transit corridor, Commonwealth Games and Southport Priority Development Area are some of the major developments in this catchment. The preferred Stage 6 option involves a 70,000 EP augmentation, utilising existing biological nutrient removal technology and includes a new Preliminary Treatment Facility, new bioreactor and two secondary clarifiers, disinfection system, waste sludge thickening and dewatering and associated ancillary and support facilities.

The initial budget for 2017-18 was $1.00 million. Budget decreases totalling $0.80 million for 2017-18 were approved resulting from deferral of works to future years.

· September Budget Review No change · March Budget Review $0.80 million decrease

Achievements for 2017-18

· Business Case approved. · Project Delivery Plan 80% complete. · Principal’s Engineer tender package 80% complete. · Environmental Consultancy tender package 80% complete. · Significant Procurement Plan 80% complete. · Project Technical Specification update consultancy awarded.

Major issues

Commissioning of the Stage 6 Upgrade in 2021 presents a significant challenge in respect of the period of time available.

Financial Performance

Year to Date Whole Project Forecast ($) 200,000 Budget ($) 69,200,000 Expenditure ($) 63,116 ITD Expenditure ($) 63,116

Variance ($) 136,884 Remaining ($) 69,136,884

Variance (%) 68% Remaining (%) 100%

761st Council Meeting 21 September 2018 41 Water And Waste Committee Meeting 13 September 2018 Adopted Report

Attachment 3.3.8

Commonwealth Games Carrara Sports Precinct Recycled Water Main

Project scope and budget

The aim of this project is to implement the necessary recycled water trunk infrastructure for the Carrara Sports Precinct. The recycled water will substitute for potable water currently used for sporting field irrigation. This project involves the detailed design and construction of a recycled water main from the Botanical Gardens at Ashmore to Carrara Sports Precinct, upgrade of the private recycled water pump at Benowa Lagoon and a 250kL storage tank at Carrara. This project involves the acquisition of an easement through the Royal Pines Resort.

The initial budget for 2017-18 was $0.10 million with no changes throughout the financial year.

Achievements for 2017-18

This project is now part of a proposed City wide Recycled Water Expansion Master Plan for which the Business Case is being developed.

Major issues

No major issues.

Financial Performance

Year to Date Whole Project Forecast ($) 100,000 Budget ($) 3,900,000 Expenditure ($) - ITD Expenditure ($) - Variance ($) 100,000 Remaining ($) 3,900,000

Variance (%) 100% Remaining (%) 100%

761st Council Meeting 21 September 2018 42 Water And Waste Committee Meeting 13 September 2018 Adopted Report

Attachment 3.4

Attachment 4: Concealed Leakage Remission by Suburb 2017-18

TOTAL REMISSIONS % of Suburb Water Sewer Total Total BURLEIGH HEA DS 43,823 108,813 152,635 6% RUNAWAY BAY 50,234 87,930 138,164 6% MERMA ID BEA CH 59,046 67,822 126,868 5% SURFERS PA RA DISE 101,548 11,386 112,934 5% SOUTHPORT 53,754 54,912 108,666 4% MERMA ID WA TERS 100,690 3,168 103,858 4% ELA NORA 69,531 33,517 103,048 4% HELENSV A LE 59,026 40,873 99,899 4% MOLENDINA R 31,827 52,761 84,588 3% NERA NG 51,265 29,129 80,394 3% PA LM BEA CH 63,605 15,357 78,961 3% CURRUMBIN WA TERS 46,056 24,231 70,287 3% LA BRA DOR 66,039 2,344 68,383 3% CA RRA RA 34,124 30,540 64,665 3% VARSITY LAKES 22,160 41,309 63,469 3% BROA DBEA CH 42,822 18,227 61,049 2% BROA DBEA CH WA TERS 55,491 3,734 59,225 2% MIA MI 33,892 22,500 56,393 2% ROBINA 55,351 908 56,259 2% PA RA DISE POINT 45,379 1,553 46,932 2% REMA INDER 593,384 128,217 721,740 29% TOTAL REMISSIONS PAID 1,679,046 779,232 2,458,417 100%

761st Council Meeting 21 September 2018 43 Water And Waste Committee Meeting 13 September 2018 Adopted Report

Attachment 3.5

This attachment (pages 43 – 46) has been redacted due to confidential content.

761st Council Meeting 21 September 2018 47 Water And Waste Committee Meeting 13 September 2018 Adopted Report

ITEM 4 WATER AND WASTE WASTE SERVICES FINANCIAL PERFORMANCE AS AT 30 JUNE 2018 FN334/252/19(P2) Attachment 1: Detailed Income Statement – Accrual Attachment 2: Detailed Income Statement – Cash Attachment 3: Status Update – Major Investments

1 BASIS FOR CONFIDENTIALITY

Not Applicable.

2 EXECUTIVE SUMMARY

Not Applicable.

3 PURPOSE OF REPORT

The purpose of this report is to provide the Water and Waste Committee with the results of Waste Services financial performance for the 2017-18 financial year. Within the report, the “revised budget” refers to the March 2018 Budget Review.

4 PREVIOUS RESOLUTIONS

EX MINUTE NO G17.0619.001

The City’s 2017-18 Budget was adopted by Council at the Budget Meeting held on 19 June 2017.

EX MINUTE NO B17.0911.003, in part

7. That the net result for Water and Sewerage Services and Waste Management be transferred to reserves as follows:

EX MINUTE NO B17.1207.003, in part

1 That Council approve the net increase of $2.3 million to be transferred to the Waste Management Reserve.

2 That Council note budget variations per Attachments 2 and 3 are included in the September 2017 Budget Review. CARRIED

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ITEM 4 (Continued) WASTE SERVICES FINANCIAL PERFORMANCE AS AT 30 JUNE 2018 FN334/252/19(P2)

EX MINUTE NO G18.0612.007, in part

5 DISCUSSION

GCWM is responsible for solid waste collection and disposal services across the City.

While GCWM is a commercial business unit within Council, it is required to comply with the requirements applicable to waste businesses under the Waste Reduction and Recycling Act (2011) and the Local Government Act (2009).

This report outlines the performance for the GCWM commercial business unit which, for the purposes of this report, is known as Waste Services.

761st Council Meeting 21 September 2018 49 Water And Waste Committee Meeting 13 September 2018 Adopted Report

ITEM 4 (Continued) WASTE SERVICES FINANCIAL PERFORMANCE AS AT 30 JUNE 2018 FN334/252/19(P2)

5.1 Waste Services High Level Financial Summary

Table 1 below provides a summary of Waste Services financial outcomes for 2017-18:

Summary Financial Management Actual Revised 2016-17 Variance Statement Budget Actuals 30 June 2018 $M $M $M % $M Operating Revenue 110.40 107.29 3.11 2.9% 103.57 Operating Expenses 70.67 72.04 1.38 1.9% 69.43 Operating Result 39.73 35.24 4.49 12.7% 34.14 Loss on Sale of Assets 0.80 0.00 (0.80) 0.0% 0.00 Net Profit 38.94 35.24 3.69 10.5% 34.14 Depreciation / Amortisation 9.34 9.75 0.41 4.3% 8.83 Earnings Before Interest and Taxation 29.60 25.49 4.11 16.1% 25.31 Interest Expense (QTC loan) 4.16 4.16 0.00 0.0% 4.59 Interest Margin Expense 0.21 0.21 (0.00) (0.0%) 0.21 Income Tax Equivalents 9.23 7.99 (1.23) (15.4%) 7.45 Net Profit After Taxation 16.00 13.13 2.87 21.9% 13.06 Participation Return 7.69 7.69 0.00 0.0% 7.69 Contribution to Whole of City projects 0.00 0.00 0.00 0.0% 0.00 Retained Earnings 8.31 5.44 2.87 52.9% 5.37 Table 1: Waste Services – Summary Financial Management Statement

Net Profit is 10.5% ($3.7 million) higher than revised projections, with Earnings before Interest and Taxation (EBIT) 16.1% ($4.1 million) higher than revised projections.

Income Tax Equivalents paid to the City was $1.2 million higher than projections in line with better than projected operating results.

5.2 Distribution of Earnings

Earnings before Interest and Taxation (EBIT) for the period ended 30 June 2018, on a cash basis, is $39.9 million (operating revenue of $110.4 million less operating expenditure of $70.5 million). This result exceeds the target set at the March 2018 Budget Review by 13.1% ($4.6 million) and is 13.9% ($4.9 million) higher than the 2016-17 result.

The table below sets out the distribution of these earnings. The final position results in Total Transfers to Reserves of $8.1 million. These funds are being accumulated for future years’ capital and landfill remediation requirements.

Actual Revised 2016-17 Distribution of Earnings Variance Budget Actuals 30 June 2018 $M $M $M % $M Interest Expense (External) 4.16 4.16 (0.00) (0.0%) 4.59 Principal Repayment (External) 8.32 8.32 (0.00) (0.0%) 8.69 Loan Funding (0.74) (0.74) 0.00 0.0% 0.00 Debt Service Movement 11.74 11.74 (0.00) (0.0%) 13.27 Capital Expenditure 2.91 3.13 0.22 7.0% 2.38 Capital Expenditure 2.91 3.13 0.22 7.0% 2.38 Tax Equivalents (30% taxable earnings) 9.23 7.99 (1.23) (15.4%) 7.45 Contribution to Whole of City projects 0.00 0.00 0.00 0.0% 0.00 Participation Return 7.69 7.69 (0.00) (0.0%) 7.69 Interest Expense Margin 0.21 0.21 (0.00) (0.0%) 0.21 Payment to Council 17.13 15.89 (1.23) (7.8%) 15.35 (Excluding SLA, Fleet & Plant and Land Tax) Retained Earnings for future Capital Works 8.08 4.48 (3.60) (80.3%) 4.00 Investment Total Transfers to Reserve 8.08 4.48 (3.60) (80.3%) 4.00

Total Distribution 39.86 35.24 (4.61) (13.1%) 35.01 Table 2: Waste Services – Distribution of Earnings

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ITEM 4 (Continued) WASTE SERVICES FINANCIAL PERFORMANCE AS AT 30 JUNE 2018 FN334/252/19(P2)

Returns to Community

Waste Services operates as a commercial business unit and provides an appropriate return to the community, based on the City’s investment in the business.

Returns paid to the City for 2017-18 exceeded the target set at the March 2018 Budget Review by $1.04 million as outlined in the table below:

Actual Revised 2016-17 Community Returns Variance Budget Actuals 30 June 2018 $M $M $M % $M Interest Margin Expense 0.21 0.21 0.00 0.0% 0.21 Income Tax Equivalents 9.23 7.99 1.23 15.4% 7.45 Land Tax Equivalent 1.19 1.38 (0.19) (13.8%) 1.19 Participation Return 7.69 7.69 0.00 0.0% 7.69 Contribution to Whole of City projects 0.00 0.00 0.00 0.0% 0.00 Return to Community 18.32 17.27 1.04 6.0% 16.54 SLA Costs 2.74 3.28 (0.54) (16.4%) 2.53 Insurance Premiums 0.08 0.08 0.00 0.0% 0.00 Fleet & Plant Charges 8.98 8.08 0.90 11.1% 8.75 Total Payments to Council 30.12 28.72 1.41 4.9% 27.82 Table 3: Waste Services – Returns to Community

The increase in returns is due higher income tax equivalents as a result of than projected operating profit.

Total Payments to Council during the year were $30.12 million which was $1.41 million (4.9%) higher than revised projections and $2.3 million (8.3%) higher than 2016-17.

5.3 Operating Revenue

Actual Revised 2016-17 Waste Services Operating Revenue Variance Budget Actuals 30 June 2018 $M $M $M % $M Waste Utility Rate Revenue 81.13 79.25 1.88 2.4% 78.04 Refuse Tipping Fees 8.45 8.14 0.31 3.8% 8.68 Recycling Revenue 2.39 2.16 0.23 10.4% 1.05 Fees and Charges 1.74 1.97 (0.23) (11.8%) 1.69 Internal Tipping Charges 10.81 10.05 0.76 7.5% 9.50 Community Service Obligations 3.20 3.12 0.09 2.7% 3.01 Interest on Outstanding Rates 0.30 0.21 0.09 41.8% 0.19 Interest on Investments 0.69 0.69 0.00 0.0% 0.52 Contributions & Donations Revenue 0.87 0.87 (0.00) (0.1%) 0.86 Other Operating Income 0.83 0.83 (0.00) (0.5%) 0.00 Grants & Subsidies Revenue 0.00 0.00 - 0.0% 0.03 110.40 107.29 103.57 Total Operating Revenue 3.11 2.9% Table 4: Waste Services Operating Revenue

The overall operating revenue result for 2017-18 was a positive variance against revised budget of $3.1 million (2.9%) comprising of an additional:

· $1.9 million in rating revenue due to higher than forecast growth in services. · $0.3 million in refuse tipping fees due to higher disposals of commercial and industrial mixed waste at the City's landfills by external customers. · $0.8 million in internal tipping charges due to accelerated works delivery program within the Transport and Infrastructure directorate.

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ITEM 4 (Continued) WASTE SERVICES FINANCIAL PERFORMANCE AS AT 30 JUNE 2018 FN334/252/19(P2)

Table 5 shows the total number of bins in service as at 30 June 2018 and the growth this financial year. Year to Date Bins in Bins in service Waste collection bins service as at as at 30 June Bin increase\ 30 June 2018 2017 (decrease) % General waste (weekly) Domestic w heelie bins 190,187 186,206 3,981 2.1% Commercial w heelie bins 7,145 7,003 142 2.0% Bulk bins (domestic and commercial) 2,933 2,860 73 2.6% Total weekly general waste services 200,265 196,069 4,196 2.1% Recyclable waste (weekly) Commercial w heelie bins 386 349 37 10.6% Bulk bins (domestic and commercial) 1,539 1,475 64 4.3% Total weekly recyclable waste services 1,925 1,824 101 5.5% Recyclable w aste (fortnightly) Domestic w heelie bins 181,918 177,869 4,049 2.3% Commercial w heelie bins 2,515 2,401 114 4.7% Total fortnightly recyclable w aste services 184,433 180,270 4,163 2.3% Other (fortnightly) Green w aste 27,415 23,533 3,882 16.5% Total fortnightly other services 27,415 23,533 3,882 16.5% Table 5 - Waste Collection Services

5.4 Operating Expenses

Operating Expenses were $1.4 million (1.9%) below revised projections, as illustrated in Table 6 below:

Actual Revised 2016-17 Waste Services Operating Expenses Variance Budget Actuals 30 June 2018 $M $M $M % $M Employee Expenses 9.45 9.09 (0.36) (3.9%) 9.45 Materials and Services 13.59 16.46 2.87 17.4% 18.77 Council Corporate SLAs 2.47 2.47 - 0.0% 2.53 Internal Directorate SLA 2.74 3.28 0.54 16.4% 8.75 Waste Collection Payments 26.73 26.63 (0.10) (0.4%) 26.79 Fleet and Plant 11.94 10.30 (1.65) (16.0%) 0.00 Consultants 1.05 1.08 0.03 2.7% 0.88 Electricity 0.15 0.15 (0.01) (4.0%) 0.17 Insurance Premiums 0.08 0.08 (0.00) (0.0%) 0.00 Other Expenditure 2.45 2.50 0.05 2.1% 2.09 Total Operating Expenses 70.67 72.04 1.38 1.9% 69.43 Table 6: Waste Services Operating Expenses

The main variances in operating expenses are due to:

Materials and Services: Variance of $2.9 million relates to:

· Lower than anticipated costs incurred to date for the re-opening of Molendinar landfill during the Commonwealth Games period; · Leachate removal costs lower than expected, due to reduced rainfall and 15% of leachate volume from Stapylton being disposed at the Coombabah sewage treatment plant which attracts a significantly lower cost per kilolitre; · Increased commodity prices resulting in lower than expected costs for Materials Resource Facility (MRF) operations; · Costs incurred for new and replacement wheelie bins has been lower than projected, due to the re-use of second-hand bins. These second hand bins became available as a result of the promotional campaign to upgrade to 360 litre recycling bins.

761st Council Meeting 21 September 2018 52 Water And Waste Committee Meeting 13 September 2018 Adopted Report

ITEM 4 (Continued) WASTE SERVICES FINANCIAL PERFORMANCE AS AT 30 JUNE 2018 FN334/252/19(P2)

Fleet and Plant: Unfavourable variance of $1.7 million within Fleet and Plant relates to expenses associated with the operation of the Waste and Recycling Centres and transportation of waste collected at those Centres exceeding budget projections, in addition to higher than expected expenses across the landfill operations. In 2018-19, Waste Services will complete a review on all fleet and plant items for efficiency.

5.5 Non-Cash Expenses

Depreciation Expense for the year totalled $9.3 million which was 4.3% below the projection of $9.8 million.

5.6 Capital Program

5.6.1 Capital Expenditure

The initial 2017-18 Waste Services capital program consisted of 10 projects totalling $6.1 million. This was reduced to $3.1 million throughout various budget reviews during the year, across 12 projects.

Waste Management Capital Expenditure as at 30 June 2018 Revised 2017-18 Actual Variance Variance 2016-17 Actuals Program Budget $M $M $M % $M

Landfills 1.07 0.98 (0.09) (9.3%) 1.69

Waste and Recycling Centres 1.28 1.68 0.41 24.2% 0.79

Fleet and Plant 0.47 0.47 0 0.0% -

Total Capital 2.82 3.13 0.32 10.1% 2.48

2017-18 actuals include an amount of $0.13 million which was non capitalised Table 7: Capital Expenditure

The final capital expenditure for 2017-18 was $2.8 million which represents a variance of 10.1% against the revised budget of $3.1 million.

5.6.2 Capital Program Achievements

Seven capital works projects were completed in the 2017-18 financial year. Significant projects completed are listed in the table below.

TOTAL 2017-18 FY PROJECT PROJECT EXPENDITURE EPENDITURE Prime Mover and Trailer 468,856 468,856 RORO Bins 2017-18 347,594 347,594 Transfer Station Minor Civil Works 2016-17 179,779 1,636,328 Sub Total (Significant Projects) 996,230 2,452,778 Other Completed Projects 191,773 9,143,690

Total 1,188,003 11,596,468 Table 8: Significant Capital Projects Completed

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ITEM 4 (Continued) WASTE SERVICES FINANCIAL PERFORMANCE AS AT 30 JUNE 2018 FN334/252/19(P2)

5.7 Other Financial Activities

5.7.1 Procurement Savings

In April 2017 (GA17.0419.007), Council resolved as follows:

5.7.2 Community Service Obligations

In accordance with Sections 23 and 24 of the Local Government Regulation 2012:

…A community service obligation is an obligation the local government imposes on a business entity to do something that is not in the commercial interests of the business entity to do.

Example of a community service obligation – giving a price concession to a particular group of customers, including pensioners, seniors and students {Section 24}

Table 10 (below) provides a summary of Community Service Obligations (CSO) provided to Waste Services for the 2017-18 year.

Actual Revised Variance 2016-17 Community Service Budget Actuals Obligation $M $M $M % $M Refuse Charge Donations 0.55 0.55 (0.00) (1%) 0.52 Free Tipping Donations 0.45 0.47 (0.02) (5%) 0.38 Kerbside Collection 1.07 1.07 (0.00) (0%) 1.18 Disaster Management - - - 0.05 Stradbroke Island Waste Disposal 0.45 0.49 (0.04) (7%) 0.46 Clean-Up Australia Day 0.02 0.04 (0.02) (55%) 0.02 Carcass Collection 0.04 0.06 (0.02) (29%) 0.06 Street and Park Bin Services 0.33 0.35 (0.02) (6%) 0.34 Foregone revenue E-Wase Social Outcomes 0.09 - 0% - Total CSO Value 2.91 3.12 (0.12) (3.9%) 3.01 Table 10 – Community Service Obligations

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ITEM 4 (Continued) WASTE SERVICES FINANCIAL PERFORMANCE AS AT 30 JUNE 2018 FN334/252/19(P2)

At Initial Budget, the total CSO revenue allocation was $3.1 million. During the year, increased funding was provided for services at South Stradbroke Island and Clean-up Australia Day. These increases were offset by servicing of public place bins being transferred to City Cleaning Branch, with total CSO value remaining at $3.1 million.

Table 10 provides details of actual expenditure incurred during 2017-18 which was lower than revised budget by $0.1 million.

Total CSO costs of $3.2 million were reimbursed by the City during the year, as shown in the Waste Services Financial Management Statement (Attachment 1). As part of the City’s year- end balancing, the final cash position for the Waste Services business was amended to reflect the lower reimbursement required of $2.91 million.

5.8 Landfill Remediation

In accordance with Australian Accounting Standards, the City is required to account for future liabilities related to the remediation, restoration and ongoing environmental and other monitoring requirements for our landfill sites (two active and five closed landfill sites).

As part of the City’s environmental obligations associated with the operation of these landfill sites, there is a legislative requirement to monitor and remediate the environmental impacts of these sites, both during their active life and following cessation of their utilisation as a landfill. Environmental Approvals (EA) for landfills require post closure monitoring for a period of thirty (30) years.

A model has been prepared to estimate the value of this future liability, based on inputs expected to be required at each landfill site, upon cessation. The cost of meeting EA requirements for active landfills are an operational expense and do not form part of liability calculation.

The final liability calculated as at 30 June 2018 is $70.0 million.

5.9 Waste Management Reserve

Cash surpluses from waste management operations are transferred to the Waste Management Reserve. These cash reserves are being accumulated to provide for:

(1) Future funding requirements for the replacement, renewal and expansion of assets required to deliver waste management services; and (2) Landfill remediation and post-closure environmental monitoring requirements – considerable post closure and remediation costs will be incurred on landfill sites once they are exhausted.

With the movements processed as part of the 2017-18 year-end review, the reserve balance, as at 30 June 2018 will be $36.0 million.

761st Council Meeting 21 September 2018 55 Water And Waste Committee Meeting 13 September 2018 Adopted Report

ITEM 4 (Continued) WASTE SERVICES FINANCIAL PERFORMANCE AS AT 30 JUNE 2018 FN334/252/19(P2)

6 ALIGNMENT TO THE CORPORATE PLAN, CORPORATE STRATEGIES AND OPERATIONAL PLAN

Not Applicable.

7 FUNDING AND RESOURCING REQUIREMENTS

Not Applicable.

8 RISK MANAGEMENT

The following risk assessment applies to this report:

Risk Number Description

Risk No. CO000435 Failure to achieve a sustainable long term financial position leading to negative impacts on Council’s ability to deliver on its key focus area commitments.

9 STATUTORY MATTERS

Not Applicable.

10 COUNCIL POLICIES § Revenue Policy § Gold Coast City Council Budget Review Policy

11 DELEGATIONS

Not Applicable.

12 COORDINATION AND CONSULTATION

13 STAKEHOLDER IMPACTS

Not Applicable.

14 TIMING

Not Applicable.

761st Council Meeting 21 September 2018 56 Water And Waste Committee Meeting 13 September 2018 Adopted Report

ITEM 4 (Continued) WASTE SERVICES FINANCIAL PERFORMANCE AS AT 30 JUNE 2018 FN334/252/19(P2)

15 CONCLUSION

As a commercial business unit within the City of Gold Coast, Waste Services operates in accordance with the requirements of Waste Reduction and Recycling Act (2011) and the Local Government Act 2009, and provide an appropriate return to the community on its investment in the business.

For the 2017-18 financial year, total returns to the community of $18.3 million have been achieved. This result is $1.04 million (6.0%) greater than March 2018 budget review projections and $1.8 million (10.8%) higher than last financial year.

16 RECOMMENDATION

It is recommended that Council resolves as follows:

1 That Council note the Waste Services Financial Performance Report for the 2017-18 financial year.

Author: Authorised by: Karen O’Brien Paul Heaton Manager Business Performance Director Water and Waste 3 September 2018 TRACKS REF: 71325753

COMMITTEE RECOMMENDATION WW18.0913.004 moved Cr PC Young seconded Cr Tozer

That Council note the Waste Services Financial Performance Report for the 2017-18 financial year. CARRIED

761st Council Meeting 21 September 2018 57 Water And Waste Committee Meeting 13 September 2018 Adopted Report

Attachment 4.1 Attachment 1: Detailed Income Statement - Accrual

Waste Services Financial Management Actual Revised Variance Statement Budget 30 June 2018 $M $M $M % Revenue Waste Utility Rate Revenue 81.13 79.25 1.88 2.4% Refuse Tipping Fees 8.45 8.14 0.31 3.8% Recycling Revenue 2.39 2.16 0.23 10.4% Fees & Charges 1.74 1.97 (0.23) (11.8%) Internal Tipping Charges 10.81 10.05 0.76 7.5% Community Service Obligations 3.20 3.12 0.09 2.7% Interest on Outstanding Rates 0.30 0.21 0.09 41.8% Interest on Investments 0.69 0.69 0.00 0.0% Contributions & Donations Revenue 0.87 0.87 (0.00) (0.1%) Other Operating Income 0.83 0.83 (0.00) (0.5%) Total Operating Revenue 110.40 107.29 3.11 2.9%

Operating Expenses Employee Expenses 9.45 9.09 (0.36) (3.9%) Materials and Services 13.59 16.46 2.87 17.4% Council Corporate SLAs 2.47 2.47 - 0.0% Internal Directorate SLA 2.74 3.28 0.54 16.4% Waste Collection Payments 26.73 26.63 (0.10) (0.4%) Fleet and Plant 11.94 10.30 (1.65) (16.0%) Consultants 1.05 1.08 0.03 2.7% Electricity 0.15 0.15 (0.01) (4.0%) Insurance Premiums 0.08 0.08 (0.00) (0.0%) Other Expenditure 2.45 2.50 0.05 2.1% Total Operating Expenses 70.67 72.04 1.38 1.9%

Total Operating Profit 39.73 35.24 4.49 12.7%

Loss on Sale of Assets 0.80 0.00 (0.80) 0.0%

EBITDA 38.94 35.24 3.69 10.5%

Depreciation 9.34 9.75 0.41 4.3%

EBIT 29.60 25.49 4.11 16.1% Interest Expense (QTC Loan) 4.16 4.16 (0.00) (0.0%) Interest Margin Expense 0.21 0.21 (0.00) (0.0%) Income Tax Equivalents 9.23 7.99 (1.23) (15.4%) NPAT 16.00 13.13 2.87 21.9%

Dividend 7.69 7.69 - 0.0%

Retained Earnings 8.31 5.44 2.87 52.9%

761st Council Meeting 21 September 2018 58 Water And Waste Committee Meeting 13 September 2018 Adopted Report

Attachment 4.2 Attachment 2: Detailed Income Statement - Cash

Waste Services Financial Management Actual Revised Variance Statement {Cash} Budget 30 June 2018 $M $M $M % Operating Revenue Waste Utility Rate Revenue 81.13 79.25 1.88 2.4% Refuse Tipping Fees 8.45 8.14 0.31 3.8% Recycling Revenue 2.39 2.16 0.23 10.4% Fees & Charges 1.74 1.97 (0.23) (11.8%) Internal Tipping Charges 10.81 10.05 0.76 7.5% Community Service Obligations 3.20 3.12 0.09 2.7% Interest on Outstanding Rates 0.30 0.21 0.09 41.8% Interest on Investments 0.69 0.69 0.00 0.0% Contributions & Donations Revenue 0.87 0.87 (0.00) (0.1%) Other Operating Income 0.83 0.83 (0.00) (0.5%) Total Operating Revenue 110.40 107.29 3.11 2.9%

Operating Expenses Employee Expenses 9.45 9.09 (0.36) (3.9%) Materials and Services 13.59 16.46 2.87 17.4% Council Corporate SLAs 2.47 2.47 (0.00) (0.0%) Internal Directorate SLA 2.74 3.28 0.54 16.4% Waste Collection Payments 26.73 26.63 (0.10) (0.4%) Fleet and Plant 11.94 10.30 (1.65) (16.0%) Consultants 1.05 1.08 0.03 2.7% Electricity 0.15 0.15 (0.01) (4.1%) Insurance Premiums 0.08 0.08 (0.00) (0.0%) Other Expenditure 2.32 2.50 0.18 7.0% Total Operating Expenses 70.54 72.04 1.50 2.1%

Total Operating Profit 39.86 35.24 4.61 13.1%

EBIT 39.86 35.24 4.61 13.1% Interest Expense (QTC loan) 4.16 4.16 0.00 0.0% Interest Margin Expense 0.21 0.21 (0.00) (0.0%) Income Tax Equivalents 9.23 7.99 (1.23) (15.4%) NPAT 26.26 22.88 3.38 14.8%

Dividend 7.69 7.69 (0.00) (0.0%) Debt Redemption 8.32 8.32 (0.00) (0.0%) Capital Expenditure 2.91 3.13 0.22 7.0% Transfer from Capital Reserve (2.73) (2.73) - 0.0% CWG Reserve Funding (0.61) (0.61) - 0.0% Loan Funding (0.74) (0.74) - 0.0% Transfer to Reserves Landfill Remediation 2.10 2.10 - 0.0% Prior year Surplus adjustments (4.15) (4.15) - 0.0%

Transfer to Reserves 13.46 9.86 3.60 (36.5%)

761st Council Meeting 21 September 2018 59 Water And Waste Committee Meeting 13 September 2018 Adopted Report

Attachment 4.3.1

Attachment 3: Status Update – Major Investments

Tugun Landfill Capping and Remediation

Project scope and budget

As part of the City’s environmental obligations associated with the operation of landfill sites, we have a legislative requirement to monitor and remediate the environmental impacts of these sites, both during their active life and following cessation of their utilisation as a landfill. Environmental approvals for landfills require post closure monitoring for a period of thirty years.

A budget allocation was provided in the 2016-17 financial year to undertake capping works at the site, which was subsequently deferred to the 2017-18 financial year. Initial budget for 2017-18 was $1.93 million and was reduced to $0 due to ongoing investigations into the most effective strategy for future utilisation and remediation of the site.

· September Budget Review $1.93 million decrease · March Budget Review No change

. Financial Performance:

2017-18 Budget Whole Project

Forecast ($) - Budget ($) - Expenditure ($) - ITD Expenditure ($) - Variance ($) - Remaining ($) -

Variance (%) - Remaining (%) -

761st Council Meeting 21 September 2018 60 Water And Waste Committee Meeting 13 September 2018 Adopted Report

Attachment 4.3.2

Resource Recovery

Project scope and budget

The City supports a waste management system that operates on the principles of waste hierarchy. Recycling and recovery are two of the easiest alternatives to landfill disposal and they represent the majority of actions in the City’s Solid Waste Strategy 2024. This includes recycling of clean, separated, high-value materials (such as metals, plastics and concrete), recovering nutrients from organic wastes (to create composts and fertilisers) and potential energy production from waste materials.

The aim of this program is to promote reuse and recycling of these products thereby reducing waste to landfill. The major waste streams targeted in this program are concrete and green waste however other construction and demolition wastes are also reprocessed.

Green waste is reused through two main programs; mulching and re-use on-site and transporting off-site for composting. The amount of green waste presented at the Waste and Recycling Centres (WRC) varies with the prevailing weather conditions.

Concrete is stockpiled and crushed on site at the City’s landfills. Currently the majority of this material is re-used on-site, however opportunities for sale of this product are under investigation.

As per Solid Waste Strategy 2024, the total waste resource recovery (recovered or recycled) target for 2017-18 is 43.75%, with a domestic waste recovery target of 33.5%. Initial budget for 2017-18 was $3.14 million.

· September Budget Review No change · March Budget Review $0.62 million decrease

Achievements for 2017-18

· Total waste resource recovery achieved for the year was 40.59%, 3.16% below the projected target of 43.75%. · Domestic waste resource recovery for the year was 26.53%, 6.97% below the projected target of 33.5%.

Major issues

· The City is not meeting the targets outlined in the Waste Strategy. Further work is required to improve recycling rates and waste diversion especially with the introduction of the Waste Levy in 2019. · Concrete crushing contractor went into liquidation causing an issue of excess material stockpiled. New contract going to market in July 2018. · Issues arose with the performance of the Green Waste Contractors ability to keep up with service demand. · Issues arose with the removal of timber waste from green waste initiating an alternative outlet for consideration. · Transport & Infrastructure (T&I) identified the volumes for landfill would be above estimates for the 2017-18 financial year. Discussions were held with T&I to divert soils from landfill.

761st Council Meeting 21 September 2018 61 Water And Waste Committee Meeting 13 September 2018 Adopted Report

Financial Performance

2017-18 Budget Annual Project

Forecast ($) 2,522,000 Budget ($) 2,522,000

Expenditure ($) 2,374,964 ITD Expenditure ($) 2,374,964

Variance ($) 147,036 Remaining ($) -

Variance (%) 5.83% Remaining (%) -

761st Council Meeting 21 September 2018 62 Water And Waste Committee Meeting 13 September 2018 Adopted Report

Attachment 4.3.3

Kerbside Clean-up

Project scope and budget

During Council’s 2016-17 budget deliberations it was determined that a kerbside clean up service would be provided for the entire City over a two year period. This service was provided to Divisions 1 to 7 in the 2016 and Divisions 8 to 14 in 2017. This program provides residents the opportunity to have unwanted items removed (free of charge) that may be difficult to dispose of via other mechanisms.

Initial budget for the 2017-18 financial year was $1.07 million, there were no budget movements for the year.

Achievements for 2017-18

· 2017 Kerbside clean-up program was successfully completed. · The 2018 Kerbside clean-up schedule was endorsed by Council in June 2018.

Major issues

· High volumes of green waste and oversized piles were left out for collection. · Area creep occurred; residents in adjoining Divisions/Suburbs laid out items for collection. · Size and weight restrictions were not adhered to, including large amounts of unbundled green waste. A contract variation was processed to ensure the collection of these items. · Residents placed unacceptable collection items on the kerb. · Illegal dumping of items either outside the collection period, in areas not eligible or on vacant land, parks and road reserves.

Financial Performance

2017-18 Budget Whole Project

Forecast ($) 1,066,000 Budget ($) 3,232,204 Expenditure ($) 1,074,293 ITD Expenditure ($) 2,258,904 Variance ($) (8,293) Remaining ($) 973,300

Variance (%) (0.8%) Remaining (%) 30.1%

761st Council Meeting 21 September 2018 63 Water And Waste Committee Meeting 13 September 2018 Adopted Report

Attachment 4.3.4 Solid Waste Strategy Implementation

Project scope and budget

The Solid Waste Strategy 2024 was endorsed by Council in September 2015. The Strategy provides a framework for the City to develop a more sustainable and integrated approach to solid waste management. The Strategy is for nine years and is a legislative requirement under the Waste Reduction and Recycling Act 2011 (s 121).

The annual program of work contributes to achieving the four important Strategy outcomes: · The City and community actively practise waste avoidance and other positive waste behaviours. · Waste re-use, recycling and resource recovery opportunities are maximised prior to landfill disposal. · Our capacity to manage future waste is secured. · Solid waste management has minimal negative impact on our environment and public health.

Initial budget for 2017-18 was $1.51 million. Budget decreases totalling $0.61 million were approved for the 2017-18 financial year resulting from the commercial food waste service commencing later than expected which delayed promotional activities for recycling promotions.

· September Budget Review $0.54 million decrease · March Budget Review $0.07 million decrease

Achievements for 2017-18

Waste and Recycling Centre (WRC) Review: o Wayfinding audits of Merrimac, Molendinar and Reedy Creek complete. o Wayfinding signage manufactured and installed at Helensvale WRC. o Helensvale WRC Recycle Street construction complete. o Paintback Paint Recycling Scheme installed and advertised for Reedy Creek and Molendinar WRC. o Environmental Management Processes and Procedures tender documentation issued to market. o Suntown and Coomera green waste pads audit reports complete.

Commercial Food Waste Service (Trial): o Council endorsement for the service to being in September 2018. o Education and marketing material is being finalised. o Funding received from the Department of Environment and Science to support the trial.

Organic Waste Programs: o A draft organic action plan developed to include the introduction of fruit and vegetable waste collection in the existing kerbside green waste bin.

Waste Promotional Activities: o Development of the WRC behaviour change strategy and program. o Development of 360L larger recycling bin promotion. o Development of green waste promotion and executed in September and October. o Design and print of food waste bin stickers and posters. o Reprint of recycling calendar.

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Major issues

· Ensuring sufficient take up of the Commercial Food Waste Service prior to commencement and having billing system ready for charging to occur.

Financial Performance

2017-18 Budget Whole Project

Forecast ($) 900,760 Budget ($) 2,595,461

Expenditure ($) 731,921 ITD Expenditure ($) 1,320,541

Variance ($) 168,839 Remaining ($) 1,274,920

Variance (%) 18.7% Remaining (%) 49.1%

761st Council Meeting 21 September 2018 65 Water And Waste Committee Meeting 13 September 2018 Adopted Report

Attachment 4.3.5

Reedy Creek Landfill Cell 3 Liner

Project scope and budget

The Environmental Authority for the Reedy Creek landfill requires that all landfill cells have an appropriately designed and constructed landfill liner system so as to provide adequate protection against possible environmental impacts such as contamination of local ground water by landfill leachate.

The construction of Cell 3 is programed for completion by the end of the 2018-19 financial year. This will maintain availability of landfill void space at Reedy Creek as existing landfill cells come to the end of their useful lives.

The project involves the design and construction of Cell 3 inclusive of bulk earthworks, engineered liner and leachate drainage systems. Funding in 2017-18 relates to the completion of design works in this financial year.

Initial budget for 2017-18 was $0.50 million. Budget decreases totalling $0.23 million were approved for the 2017-18 financial year resulting from further investigations into a change in scope constructing cells 3 and 4 together, delaying the detailed design phase. Construction will commence in 2018-19.

· September Budget Review $0.10 million decrease · March Budget Review $0.13 million decrease

Achievements for 2017-18

· Detailed design and tender documentation for construction of Cell 3 completed. · Investigation and options analysis carried out during the design phase created an additional 142,500 cubic metres of airspace volume that will extend the life of the landfill by 1.2 years. This will be achieved by reconfiguring the side batter and combining Cell 3 and Cell 4 for detailed design and construction.

Major issues

No major issues.

Financial Performance

20176-18 Budget Whole Project

Forecast ($) 275,000 Budget ($) 5,100,454 Expenditure ($) 213,648 ITD Expenditure ($) 220,454 Variance ($) 61,352 Remaining ($) 4,880,000

Variance (%) 22.3% Remaining (%) 95.7%

761st Council Meeting 21 September 2018 66 Water And Waste Committee Meeting 13 September 2018 Adopted Report

ITEM 5 WATER AND WASTE DRAFT WATER STRATEGY FOR COMMUNITY CONSULTATION WFB600/259/14(P2) Refer 45 page attachment

1 BASIS FOR CONFIDENTIALITY

Not Applicable.

2 EXECUTIVE SUMMARY

Not Applicable.

3 PURPOSE OF REPORT

To seek Council approval to proceed with community consultation on draft Water Strategy scheduled for November 2018.

4 PREVIOUS RESOLUTIONS

No previous Council resolutions.

5 DISCUSSION

Background

Water is essential to the people, the place and the prosperity of the Gold Coast:

· Our safe and reliable drinking water, stormwater infrastructure, fit for purpose recycled water and effective conveyance, treatment and disposal of sewage creates a robust and sustainable foundation for the growth of our city and its economy. · Safe recreational water quality on the Gold Coast’s iconic beaches, fed from world heritage-listed rainforests but transferred through our urban area, provides a lifestyle unrivalled the world over. · The use of Gold Coast waterways by residents and tourists creates economic activity, which in turn stimulates the economy, creates employment, and triggers ongoing investment.

96% of surveyed residents agree or strongly The premium paid for 96% agree that waterways contribute to their personal proximity to water health and wellbeing accounts for around 34% of the total land value, with an increase in land values due to 91% of surveyed residents believe waterways water proximity totalling 91% were a significant reason they chose to live on $41 billion. the Gold Coast (Marsden Jacobs, 2016)

Figure 1 – Snapshot of community sentiment in relation to water and open space (refer Appendix 1)

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ITEM 5 (Continued) DRAFT WATER STRATEGY FOR COMMUNITY CONSULTATION WFB600/259/14(P2)

For our water to remain safe and sustainable, there are a number of emerging challenges which need to be managed:

· Growing population and increasing urbanisation, causing pollution and degradation of waterways and water bodies (such as Benowa Flood Channel fish kill). · Increasing community expectations for safe drinking and recreation water under all circumstances (such as Lake Hugh Muntz). · Aging infrastructure leading to increased failure or increased investment (such as increased sewer relining costs from $2m to $5m annually). · Increasing climatic variability such as associated with droughts (resulting in increased groundwater extraction) but also more intense rainfall periods (resulting in increased flooding). · Degraded land use and vegetation within catchments impacting waterways health (such as the measured reduction in historical natural streamflows of up to 30%).

Water servicing within cities has traditionally focused on meeting the basic needs of people (sustenance, health, and safety) through essential service provision (drinking water, sanitation, and drainage). However, there is now a growing emphasis on the importance of water system services in enhancing a place’s liveability, sustainability, productivity and prosperity. This broader approach entails realigning the conventional water services approach by transitioning towards a more water sensitive approach; which includes integrated management of the whole water cycle, consideration of water systems as an integral part of the urban landscape, and engagement with citizens as active stewards of a city’s water resources and environments. This is the purpose of developing a Water Strategy.

Current Situation

Development of a Water Strategy by Water and Waste commenced in 2016 by becoming a member of the Cooperative Research Centre for Water Sensitive Cities (CRC WSC). This membership enabled alignment with established and successful water authorities and local governments around Australia and overseas, including access to world-class collaborative research and innovation. In particular, adoption of the CRC WSC framework provides the ability to measure, benchmark and compare progress over time.

Supported by environmental and economic water studies completed for the Water Strategy, the CRC WSC designed and facilitated a series of five stakeholder workshops, interviews and focus groups, including benchmarking the Gold Coast’s current water sensitive city performance.

Collectively over 70 leaders and strategic thinkers specialising in water, planning, environment and community sectors across the organisation and region participated in the project between December 2016 and June 2017 to develop a shared understanding and transition pathway for the Gold Coast to become a water sensitive city over the next 20 years.

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ITEM 5 (Continued) DRAFT WATER STRATEGY FOR COMMUNITY CONSULTATION WFB600/259/14(P2)

Through this process stakeholder relationships were strengthened and a Water Network was established. The draft Water Strategy builds upon the foundation of the envisioning and transition planning process and the associated final report “Envisioning, Benchmarking and Transition Planning for a Water Sensitive Gold Coast” (CRC WSC Executive Summary Report #69311818 is a summary document of this work).

In 2017, a Water Strategy Steering Committee was established with key executive representatives from across the organisation, including external water specialists facilitated by the International Water Centre (based at Griffith University). The external panel members provide interdisciplinary, independent, open and transparent specialist advice, peer-review and strategic input to support the decision making process for the development of the Water Strategy and ensured the framework developed is robust to enable successful implementation of the strategy. Ongoing engagement with the Steering Committee and Water Network, supports the critical role of community and specialist partnerships, as being a key foundation of the Water Strategy.

Options

The scope of the Draft Water Strategy (refer Appendix 2 with summary in Appendix 3) covers all of the City’s water environments and water resources. This includes rivers, creeks, canals, lakes, wetlands, estuaries and ocean. It also includes drinking water, non-drinking water, sewage, stormwater, flood waters and groundwater.

The Strategy outlines the first five year step (Phase 1) of a 20 year transition to become a city which is characterised by:

· safe and reliable water supplies; · effective sanitation; · resilience to flood; · healthy connected ecosystems; · cool green landscapes; · efficient use of valued resources; · beautiful urban spaces that feature water; · a connection to waterways; and · healthy waterways for recreation.

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ITEM 5 (Continued) DRAFT WATER STRATEGY FOR COMMUNITY CONSULTATION WFB600/259/14(P2)

The draft Water Strategy is focused on achieving the following five strategic outcomes:

OUR VISION: ‘A CITY WHERE WE MANAGE OUR RESOURCES FOR A SUSTAINABLE FUTURE

Our Healthy Water Inspired Innovative Water Partnership for Our Water Waters. Design. Solutions. Water Lifestyle Healthy & connected The Gold Coast is a Our resources are We all work together Our community water environments well-designed and valued with future to manage and embraces and underpin our resilient city inspired opportunities driven protect our water celebrates water as economy & lifestyle by water. through innovation. environments and an integral part of the resources. Gold Coast identity.

The option available is to now proceed to community consultation on the draft Water Strategy to help to shape the direction of our City.

6 ALIGNMENT TO THE CORPORATE PLAN, CORPORATE STRATEGIES AND OPERATIONAL PLAN

Corporate Plan

The proposed Water Strategy supports the delivery of a range of corporate objectives, key plans and programs of work. The relevant Corporate Plan (Gold Coast 2022) objectives are listed in the table below.

PLACE PROSPERITY PEOPLE 1.2 We live in balance with 2.3 We have infrastructure 3.1 Our city is safe nature that supports productivity and 3.3 Our community is 1.3 We manage our resources growth inclusive and supportive for a sustainable future 2.5 We are a globally 3.6 We are an active and 1.6 Our modern centres create recognised tourism healthy community vibrant communities destination 1.8 Our city is resilient to natural hazards

A. We plan for the future of our city B. We manage our city responsibly

The full list of programs of work outlined in Gold Coast 2022, supported by the draft Water Strategy, can be found in Appendix 4.

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ITEM 5 (Continued) DRAFT WATER STRATEGY FOR COMMUNITY CONSULTATION WFB600/259/14(P2)

Alignment to Corporate Strategies

This is the Gold Coast’s first integrated Water Strategy and is complimented by, and supports the delivery of other corporate strategies outlined below, specifically Our Natural City and Ocean Beaches.

· Our Natural City Strategy 2017-2021 · Ocean Beaches Strategy 2013-2023 · Economic Development Strategy 2013-2023 · Solid Waste Strategy 2014-2023 · Culture Strategy 2013-2023

Additionally the Water Strategy is aligned to eleven of the seventeen United Nations Sustainable Development Goals to which Australia is a signatory, and the Water Services Association of Australia a supporter.

8 FUNDING AND RESOURCING REQUIREMENTS

There is no financial impact on the approved 2018-19 financial budget.

The first five years (Phase 1) of the 20 year transition will focus on ensuring there is a solid foundation for delivery for the future strategy phases. Funding and resource requirements will be developed over the coming months following endorsement of the high level actions and following community consultation and feedback.

The draft Water Strategy Implementation Plan (currently under development) will detail funding and resourcing requirements for future years and will be submitted to Council for consideration with the Final Water Strategy.

9 RISK MANAGEMENT

The implementation of the draft Water Strategy will support actions that help to mitigate a range of corporate risks both directly and indirectly. Risks with a direct relationship to the Water Strategy are listed in the table below.

Corporate risk Gold Coast Water 0501 Seaway recycled water release exceeds capacity causing adverse and Waste environmental harm. Planning and 0644 Natural Hazards Resilience - The City is not adequately resilient to Environment natural hazard shocks resulting in loss of life, cessation of Council business, reputational damage and economic downturn. Planning and 0675 A reduction in the extent and quality of the City's natural asset network, Environment green space and community access opportunities, resulting in a possible decline in city liveability, image and economic potential.

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ITEM 5 (Continued) DRAFT WATER STRATEGY FOR COMMUNITY CONSULTATION WFB600/259/14(P2)

10 STATUTORY MATTERS

Not applicable.

11 COUNCIL POLICIES

Not applicable.

12 DELEGATIONS

Not applicable.

13 COORDINATION & CONSULTATION

Extensive coordination has been undertaken to engage key internal and external stakeholders over the last two years to help shape the development of the draft Water Strategy. Building strong and ongoing collaborative partnerships with local communities, state agencies, universities and industry is considered critical for successful delivery of the Water Strategy. The consultation process to date has included:

· Ongoing engagement with relevant City of Gold Coast directorates, branches, teams and working groups. · Internal and external stakeholder engagement through large water sensitive envisioning workshops facilitated by the CRC WSC. · Formation of a Water Strategy Steering Committee with select internal and external water governance specialists. · Externally facilitated community focus group to test readability of the draft Water Strategy.

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ITEM 5 (Continued) DRAFT WATER STRATEGY FOR COMMUNITY CONSULTATION WFB600/259/14(P2)

Many stakeholders across varied City directorates from Officer to Director level have been consulted through a variety of approaches throughout the development phases of the draft Water Strategy.

Key Stakeholders Consulted Directorate or Is the Stakeholder Organisation Satisfied with Report Internal Kathy Baker Water and Waste Yes Manager Service Sustainability Kevin Page Water and Waste Yes Executive Coordinator Service Sustainability Joshua Evans Water and Waste Yes Executive Coordinator Environment and Catchment Management Chris Owen Water and Waste Yes Manager Customer Engagement Donald Mackenzie Economy, Planning Yes Executive Coordinator City Planning and Environment Shannon Hunt Transport and Yes Executive Coordinator Stormwater Beaches and Infrastructure Waterways Sarah Wilton Office of the Chief Yes Manager Cooperate Planning and Performance Operating Officer Lance Beam Office of the Chief Yes Executive Coordinator Portfolio Governance Operating Officer and Management Brooke Denholder Lifestyle and Yes Manager of Safe and Liveable Communities Community Tim Robson Lifestyle and Yes Coordinator Natural Areas Management Community

The draft Water Strategy has been prepared using community views captured from previous “GC Have your Say” surveys, including the City Budget 2017-18; Our Natural City Strategy 2017-2021 and the Nerang Lakes and Canals Health Study 2017. An Environmental Scan (2016) completed for the Water Strategy examined five years of water related community surveys. In addition community surveys were reviewed from external organisations such as Gold Coast Waterways Authority and Healthy Land and Water. In all surveys the community has expressed a strong desire for protection of Gold Coast’s environmental and waterway values; for their intrinsic value in their own right and for its importance to the communities overall happiness, health and well-being. The proposed consultation for the draft Water Strategy will provide the community the opportunity to have a say on their priorities for the outcomes and actions proposed.

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ITEM 5 (Continued) DRAFT WATER STRATEGY FOR COMMUNITY CONSULTATION WFB600/259/14(P2)

Over a six month period (Dec 2017-June 2018) stakeholders from organisations and community groups listed below contributed to city benchmarking, envisioning, development of priority objectives, identification of barriers and transition strategies that form the foundations of the draft Water Strategy. As an outcome these stakeholder organisations support the intent of the Water Strategy and the joint stewardship role required for its successful implementation. Key external stakeholders consulted include:

· Cooperative Research Centre for Water Sensitive Cities · Griffith University - Cities Research Institute - Australian Rivers Institute - Centre of Coastal Research - Urban and Environmental Planning · Gold Coast Catchment Association (community group) · Gold Coast Waterways Authority · Healthy Land and Water · International Water Centre · Jabree Ltd (Traditional Owner community group) · Seaworld Research and Rescue · Seqwater · Queensland State government - Department of Agriculture and Fisheries - Department of Environment and Science - Department of Infrastructure, Regional Development and Planning · University of Queensland

Community Consultation

Objectives

1. Demonstrate why a draft water strategy is important to people on the Gold Coast (why should they care).

2. To support the community consultation by driving people to gchaveyoursay.com.au/waterstrategy and encourage survey completions, so that:

· The findings are a good indication of Gold Coast community sentiment; and · The findings can inform decision making.

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ITEM 5 (Continued) DRAFT WATER STRATEGY FOR COMMUNITY CONSULTATION WFB600/259/14(P2)

Communication Approach

The recommended communication approach includes:

· Targeting of communications to reach Gold Coast residents. · An integrated multi-channel approach to reach multiple demographics. · Multiple message frequency to drive action. · Use of varied creative in social channels to achieve message cut-through with different audience demographics.

14 STAKEHOLDER IMPACTS

Internal Stakeholder Impacts

A broad range of internal stakeholders across council have been engaged in the development of the draft Water Strategy. Stakeholder input has been considered and incorporated to respond to emerging challenges and opportunities, and the current operational and financial context. As such it represents an agreed, practical, ‘whole of organisation’ response to strategic management of water environments and water resources in the city.

There are no direct internal stakeholder impacts associated with the proposed community consultation. It has been identified and programmed on this year’s consultation plan.

The draft Water Strategy will strengthen alignment between directorates, branches and teams. It supports the City Plan, environmental, water, innovation, resilience and city liveability outcomes. Relevant teams will continue to be engaged following community consultation and feedback.

External / community stakeholder Impacts

There are no anticipated significant external / community stakeholder impacts associated with progression of the draft Water Strategy to community consultation however there is likely to be some public discussion and commentary around a range of current and topical water issues, including but not limited to:

· Ongoing management of Lake Hugh Muntz; and · The construction of the Long Term Seaway Release (Stage 1) and future stages.

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ITEM 5 (Continued) DRAFT WATER STRATEGY FOR COMMUNITY CONSULTATION WFB600/259/14(P2)

15 TIMING

The following timeline highlights progress to date and planned future activities.

FINALISE

CONSULT · Developing detailed implementation plan DEVELOPE · Draft strategy presentation · Commence water to ELT (Aug 18) & Council strategy implementation ENGAGE & INVESTIGATE · Workshop 4 (26 Apr 17) (Sep 18) (0-5 years)-Investigate, Identifying actions to drive · Public consultation on draft trial, implement PLAN · Desktop review of trends the transition water strategy (Nov 18) (key risks & opportunities) · Workshop 5 (31 May 17) · Incorporation of public · Identification of key internal · Interviews with key Tailoring actions & comments and feedback & external stakeholders stakeholders specifying targets · Final water strategy (Mar · Develop an engagement · Establish steering group · Stakeholder engagement 19) plan · Workshop 2 (28 Feb 17) on draft waster strategy · Partnership with Developing a narrative & Cooperative Research future vision Centre for Water Sensitive · Workshop 3 (29 Mar 17) Cities Setting priorities & exploring · Workshop 1 (9 Dec 16) transition challenges Understanding & benchmarking today

Community consultation is planned to occur during the first three weeks in November. It is anticipated that following community consultation, the Final Water Strategy and the Water Strategy Implementation Plan will be submitted to Council for consideration in early 2019.

16 CONCLUSION

The proposed draft Water Strategy has been developed to ensure the City manages our water environments and resources sustainably. It will build on, complement and support the achievement of the City’s strategic objectives in the Corporate Plan and other City strategies to enhance our liveability and resilience.

The proposed draft Water Strategy highlights opportunities for better managing our changing water environments and resources in response to the challenges of population growth and a changing environment. These challenges will see increased demand for water, sewage, and stormwater services, as well as increased use of open space and water environments for recreation. These issues are critical for us all to address for the future of our City and broad community consultation is appropriate.

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ITEM 5 (Continued) DRAFT WATER STRATEGY FOR COMMUNITY CONSULTATION WFB600/259/14(P2)

17 RECOMMENDATION

It is recommended that Council resolves as follows:

That the draft Water Strategy proceeds to community consultation.

Author: Authorised by: Maryam Heshmat Paul Heaton Executive Coordinator Strategic Planning Director Water and Waste 3 September 2018 TRACKS REF: 68371062

COMMITTEE RECOMMENDATION WW18.0913.005 moved Cr Tozer seconded Cr PC Young

That the draft Water Strategy proceeds to community consultation.

CARRIED

Director Paul Heaton acknowledged the work of Mitch Longhurst and Amy Lomax for their work associated with the Water Strategy.

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Attachment 5.1

APPENDIX 1 – Snapshot of community sentiment in relation to water and open space captured from previous community surveys

Previous survey engagement outputs City Budget 2017/18 · We manage quality rural and urban living while looking after the future of the city’s rain forest, bushland, waterways and open space scored second highest ranking for community sentiment on priority key outcomes for the city. · Responsible development, cleanliness, parks and open space ranked in the top for additional suggestions made Our Natural City Strategy · 67.41 per cent of respondents strongly support the ‘People in nature’ 2017 action of 1.4 Encourage community involvement in helping to care for the city’s water environments. This action had the highest level of support out of the four actions under ‘People for nature’. · 79.84 per cent of respondents strongly support the ‘Places for nature’ action of 2.3 Continue to implement environmental policies to protect native vegetation, habitats, corridors, wetlands and waterways Nerang Lakes and · The most popular use of the Nerang River lakes was passive Canals Health Study recreation e.g. picnicking, walking (62 per cent) followed by active 2016 recreation e.g. swimming, canoeing (31 per cent) and fishing (24 per cent). · For the Nerang River lakes, the most important environmental values were: o Aquatic ecosystem (469) o Visual recreation (465) o Primary recreation (434) o Seagrass (431) o Secondary recreation (430) · The most important thing to consider in the management of Nerang River Lakes and Canals: o Supporting the ecology of the lakes and canals (22 per cent) o Managing/reducing pollution and rubbish (21 per cent) o Run off, erosion, mangroves and riverbank health (13 per cent) · The most important thing to consider in the management of Nerang River Lakes and Canals: o Supporting the ecology of the lakes and canals (22 per cent) o Managing/reducing pollution and rubbish (21 per cent) o Run off, erosion, mangroves and riverbank health (13 per cent) Parks are for everyone · 67.3% of people surveyed found shaded areas to be extremely 2016 important · 65.9% of people surveyed found trees to be extremely important Socio-economic uses and · 91% of respondents either agreeing or strongly agreeing that economic value study of waterways are a significant reason why they chose to live on the the Gold Coast Gold Coast Waterways 2017 · 96% either agreeing or strongly agreeing that waterways contribute (NCEconomics and to their personal health and wellbeing GCWA)

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Attachment 5.2

APPENDIX 2 – Draft Water Strategy

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761st Council Meeting 21 September 2018 86 Water And Waste Committee Meeting 13 September 2018 Adopted Report

761st Council Meeting 21 September 2018 87 Water And Waste Committee Meeting 13 September 2018 Adopted Report

761st Council Meeting 21 September 2018 88 Water And Waste Committee Meeting 13 September 2018 Adopted Report

761st Council Meeting 21 September 2018 89 Water And Waste Committee Meeting 13 September 2018 Adopted Report

761st Council Meeting 21 September 2018 90 Water And Waste Committee Meeting 13 September 2018 Adopted Report

761st Council Meeting 21 September 2018 91 Water And Waste Committee Meeting 13 September 2018 Adopted Report

761st Council Meeting 21 September 2018 92 Water And Waste Committee Meeting 13 September 2018 Adopted Report

761st Council Meeting 21 September 2018 93 Water And Waste Committee Meeting 13 September 2018 Adopted Report

761st Council Meeting 21 September 2018 94 Water And Waste Committee Meeting 13 September 2018 Adopted Report

761st Council Meeting 21 September 2018 95 Water And Waste Committee Meeting 13 September 2018 Adopted Report

761st Council Meeting 21 September 2018 96 Water And Waste Committee Meeting 13 September 2018 Adopted Report

761st Council Meeting 21 September 2018 97 Water And Waste Committee Meeting 13 September 2018 Adopted Report

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761st Council Meeting 21 September 2018 99 Water And Waste Committee Meeting 13 September 2018 Adopted Report

761st Council Meeting 21 September 2018 100 Water And Waste Committee Meeting 13 September 2018 Adopted Report

761st Council Meeting 21 September 2018 101 Water And Waste Committee Meeting 13 September 2018 Adopted Report

761st Council Meeting 21 September 2018 102 Water And Waste Committee Meeting 13 September 2018 Adopted Report

761st Council Meeting 21 September 2018 103 Water And Waste Committee Meeting 13 September 2018 Adopted Report

761st Council Meeting 21 September 2018 104 Water And Waste Committee Meeting 13 September 2018 Adopted Report

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761st Council Meeting 21 September 2018 108 Water And Waste Committee Meeting 13 September 2018 Adopted Report

761st Council Meeting 21 September 2018 109 Water And Waste Committee Meeting 13 September 2018 Adopted Report

761st Council Meeting 21 September 2018 110 Water And Waste Committee Meeting 13 September 2018 Adopted Report

761st Council Meeting 21 September 2018 111 Water And Waste Committee Meeting 13 September 2018 Adopted Report

Attachment 5.3

APPENDIX 3 – Draft Water Strategy Summary

761st Council Meeting 21 September 2018 112 Water And Waste Committee Meeting 13 September 2018 Adopted Report

761st Council Meeting 21 September 2018 113 Water And Waste Committee Meeting 13 September 2018 Adopted Report

761st Council Meeting 21 September 2018 114 Water And Waste Committee Meeting 13 September 2018 Adopted Report

761st Council Meeting 21 September 2018 115 Water And Waste Committee Meeting 13 September 2018 Adopted Report

761st Council Meeting 21 September 2018 116 Water And Waste Committee Meeting 13 September 2018 Adopted Report

761st Council Meeting 21 September 2018 117 Water And Waste Committee Meeting 13 September 2018 Adopted Report

761st Council Meeting 21 September 2018 118 Water And Waste Committee Meeting 13 September 2018 Adopted Report

761st Council Meeting 21 September 2018 119 Water And Waste Committee Meeting 13 September 2018 Adopted Report

Attachment 5.4

APPENDIX 4 - Alignment to Gold Coast 2022 objectives and themes Contribution to strategic objectives including Key strategies, plans and programs of works

Place Theme 1.1 Our city provides a choice of liveable places · Protect identified areas for their distinctive character or lifestyle attributes, including parks, green space, City assets, high value ecological areas or land with rural production and scenic amenity values. 1.2 We live in balance with nature · Support the preservation of the city's natural environment (open space, natural resources and conservation) through a strategic leadership approach to the City Plan and environmental strategies. · Develop and implement plans that encourage appropriate access and use of the city's unique natural areas while maintaining the liveability and amenity of the city. · Restore ecosystems and fauna through weed control, natural regeneration, revegetation, maintenance, education and voluntary programs. · Management of the conservation network across private and public land, including Voluntary Conservation Agreements and the Nature Conservation Assistance Program. 1.3 We manage our resources for a sustainable future · Implement plans to ensure that our waterways and water resources are managed for the benefit of our city · Promote water efficiency and minimise water waste by reducing water leakage and improving customer awareness of smarter water use. · Manage sewerage systems to reduce impacts on the environment by reducing inflow and infiltration. · Implement a Total Water Cycle Management Plan which considers all elements of the water cycle including catchment management, stormwater and waterway management and incorporates benchmarking and measurement of the Gold Coast as a water sensitive city. · Progressively design and construct a long-term system for safe release of excess recycled water for the city. 1.5 We are an active digital city · Increase the use of real-time data to deliver services and provide information to the public through the roll out of sensors and devices to support disaster responses, public safety and other initiatives. 1.6 Our modern centres create vibrant communities · Provide clear vision and direction for the future growth of the CBD; identify and prioritise key projects and optimise opportunities. · Deliver the City Place Making Program to facilitate the long-term, integrated planning and development of safe, vibrant public spaces and neighbourhoods that are valued by local people and are attractive to visitors, strengthening the local community and economic life. · Encourage open and accessible parklands and other public spaces in high density areas, bringing communities together by providing opportunities for social connections. · Deliver the Urban Greenspace Program through increased tree planting and landscaping that improves neighbourhoods and makes areas more attractive through tree lined boulevards and inviting parklands. 1.7 Everyone can enjoy a beach experience The Draft Water Strategy aligns and supports delivery of: · Implement the Ocean Beaches Strategy 2013–2023 to ensure our beaches are clean, healthy, safe and accessible now and into the future.

761st Council Meeting 21 September 2018 120 Water And Waste Committee Meeting 13 September 2018 Adopted Report

1.8 Our city is resilient to natural hazards · Deliver a flood resilient Gold Coast through the Sustainable Flood Management Program. · Manage natural hazard exposure across the city including, slope instability, heatwave, bushfire, flood and storm tide through strategic land-use planning. · Develop innovative computer modelling tools for the management of natural hazards. · Use innovative urban design and city planning to promote city resilience. Prosperity Theme 2.1 Our city economy is diverse and innovative · Through the Gold Coast Health and Knowledge Precinct (200 hectare precinct developed in collaboration with the Queensland Government) accelerate the creation of jobs, attract a talented workforce and increase innovation in the city, delivering a vibrant mixed-use community. 2.2 We have a thriving cultural economy · Support and advocate for creative cultural opportunities that reflect the unique and iconic characteristics of and opportunities for communities across the Gold Coast. 2.3 We have infrastructure that supports productivity and growth · Develop and implement the Local Government Infrastructure Plan, which identifies the trunk infrastructure and standards of service required to support urban development. · Support the attractiveness of city lifestyle and amenity to potential businesses and skilled talent through maintaining and enhancing social infrastructure, parklands and open space networks. 2.5 We are a globally recognised tourism destination · Capitalise on emerging trends in the tourism market by driving the development of active and eco tourism experiences in the hinterland and other natural areas. · Facilitate the development of world-class tourism infrastructure to grow the city’s reputation as a premier tourism destination. · Implement a program to improve service quality, standards and customer responsiveness across tourism and service sectors, improving visitor satisfaction. People Theme 3.1 Our city is safe · Support community safety through innovative urban design and city planning. · Develop and implement a strategic plan for Disaster Management to minimise adverse impacts that threaten the safety of the community prior, during and after an event. · Develop and implement capability to provide real time information to the public in the event of natural disasters. 3.2 We are proud of our city · Support the development of a strong culture of volunteering in the city through capitalising on the GC2018 Volunteering Program. 3.3 Our community is inclusive and supportive · Deliver a Liveable City Program that connects people, celebrates diversity, increases civic pride and encourages · our community to thrive. · Create vibrant communities by improving authenticity and amenity through urban design. 3.4 Our city embraces culture every day · Develop and implement an Indigenous Heritage and Culture Program which celebrates the history, culture and achievements of Aboriginal and Torres Strait Islander peoples. 3.5 Our city provides a wide range of job opportunities · Facilitate innovation in sports, science, art, architecture and education by engaging with the arts and creative sectors.

761st Council Meeting 21 September 2018 121 Water And Waste Committee Meeting 13 September 2018 Adopted Report

3.6 We are an active and healthy community · Implement the Nature Based Recreation Plan 2015-2025, encouraging the community to actively embrace the natural areas of the city. · Increase public accessibility to healthy lifestyle options through the Active and Healthy Program. A. We plan for the future of our city · Implement the City Vision through the development and implementation of long-term plans, including Gold Coast 2022 (Corporate Plan) and corporate strategies. · Manage the long-term financial sustainability of the City to ensure sustainable City assets and services. · Manage the maintenance, renewal and delivery of infrastructure for the city through the Total Asset Management Plan and the forward Capital Works Program. · Develop and implement the Local Government Infrastructure Plan, which identifies the trunk infrastructure and standards of service required to support urban development. · Manage the long term growth of the city through the City Plan, focusing on the redevelopment of urban centres and key inner city neighbourhoods, ensuring non-urban areas such as the hinterland ranges and foothills are protected. · Manage risk exposure faced by the city to minimise the impact of adverse events and take advantage of opportunities for the city. · Encourage coordinated and constructive partnerships across all levels of government, business and the community to access appropriate levels of funding, infrastructure and services that support the delivery of the City Vision. B. We manage our city responsibly · Deliver a wide range of high quality services to the Gold Coast community (as identified in the annual Operational Plan). · Provide safe and reliable water, sewerage and waste services to people of the Gold Coast to protect our communities’ health and wellbeing and to care for the catchments and waterways that support our city’s lifestyle and future prosperity (see Appendix 2 and 3 for details of the City’s Commercialised Business Units – Water and Waste).

There being no further business the meeting was declared closed at 11.02am.

761st Council Meeting 21 September 2018 122 Water And Waste Committee Meeting 13 September 2018 Adopted Report

These Pages

Numbered 1 to 122

Constitute The Adopted Report Of The Meeting

Of The Water and Waste Committee

Held Thursday, 13 September 2018