OCTOBER 2016 MINUTES PAGE 1

Minutes of the First Meeting of the District Council following the 2016 Triennial General Election held at 2.00pm on Wednesday, 26 October 2016 in the Concert Chamber, Whanganui War Memorial Centre, Watt Street, Whanganui

Present: Mayor Hamish McDouall, Crs Charlie Anderson, - Hogan, David Bennett, Josh Chandulal-Mackay, Helen Craig, Jenny Duncan, Kate Joblin, Hadleigh Reid, Alan Taylor, Rob Vinsen, Graeme Young.

Apology: Councillor-elect Murray Cleveland.

In Attendance: Wanganui Rural Community Board Members: Messrs Michael Dick, David Matthews, Grant Skilton, David Wells and Ms Sandra Falkner.

Officers in Attendance: Mr Kym Fell (Chief Executive), Kaiwhakahaere John Maihi, Secretary: Mrs Karyn Turner (Governance Services Officer).

This meeting has been called by the Chief Executive pursuant to clause 21, Schedule 7 of the Local Government Act 2002 (“the Act”) for the purpose of:

A. Election Results: The Electoral Officer to present the 2016 Council electoral results; B. Declaration: Making and attesting the declaration of the Mayor; C. Declaration: Making and attesting the declaration of the Councillors. D. Appointment: Appointment of Deputy Mayor – section 41A(3)(a) of the Act; Alternatively Election: Election of Deputy Mayor – clause 17(1) and clause 25, Schedule 7 of the Act; E. General Explanation: General explanation of key legislative provisions; F. Council Meetings: the fixing of the date and time of the first meeting of the local authority, or the adoption of a schedule of meetings.

1. Welcome and Apologies Kaiwhakahaere John Maihi welcomed His Worship the Mayor, Councillors and Wanganui Rural Community Board members to the meeting.

Mr Kym Fell, Chief Executive, assumed the Chair and extended a welcome to those at the meeting, including special guests, Mayor Elect, Councillors’ Elect, family and friends and past elected members.

Mr Fell also noted the following apologies: Chester Borrows (Member of Parliament, Whanganui), Kemp Dryden (Ngati Rangi), Raewyn Overton-Stuart (Chair, Whanganui Chamber of Commerce), Marshall Tangaroa (Chair, Whanganui Regional Museum Trust) and Acting Area Commander Whanganui Police, Thomas McIntyre. OCTOBER 2016 MINUTES PAGE 2

Council’s Resolution Proposed by Mayor McDouall, seconded by Cr Craig:

THAT Councillor-elect Murray Cleveland’s apology is received. CARRIED

2. Election Results Kym Fell, Chief Executive, acknowledged the work of Whanganui District Council’s Electoral Officer, Noeline Moosman. A copy of the official declaration of results for the 2016 Whanganui District Council triennial general election, held on 8 October 2016 was tabled. (Ref A).

References – Agenda Attachments A Official declaration of results for the 2016 Whanganui District Council triennial general election.

3. Declaration of Mayor Kym Fell, Chief Executive, declared Hamish Crichton McDouall to be elected to the office of Mayor of the District of Whanganui.

Hamish Crichton McDouall completed the statutory declaration in accordance with clause 14 of Schedule 7 of the Act, witnessed by the Chief Executive.

“I, Hamish Crichton McDouall, declare that I will faithfully and impartially, and according to the best of my skill and judgment, execute and perform, in the best interests of Whanganui District, the powers, authorities, and duties vested in, or imposed upon me as Mayor of the Whanganui District Council by virtue of the Local Government Act 2002, the Local Government Official Information and Meetings Act 1987, or any other Act.

4. Presentation of Mayor’s Robe and Chain Kym Fell, Chief Executive, read the induction address explaining the significance of the Robe and Chain of Office and placed them on His Worship the Mayor Hamish Crichton McDouall.

5. Presentation of Mayoress’ Chain Kym Fell, Chief Executive, welcomed Mayoress Elinor Harvey McDouall and presented her with the Mayoress’ Chain.

The Chief Executive vacated the Chair. Mayor Hamish McDouall assumed the Chair.

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6. Declaration of Members Mayor Hamish McDouall declared the Members elected to the Whanganui District Council.

1. Peter Hadleigh (Hadleigh) Reid 2. Murray Ronald Cleveland 3. David Winstone Aitken Bennett 4. Charles George (Charlie) Anderson 5. Helen Marguerite Mary Craig 6. Kathleen Francis (Kate) Joblin 7. Robin Victor (Rob) Vinsen 8. Alan Richard Taylor 9. Joshua Buchanan (Josh) Chandulal-Mackay 10. Jennifer Ruth (Jenny) Duncan 11. Philippa June Baker-Hogan 12. Graeme Walker Young

Each Councillor, except Councillor-elect Murray Cleveland, completed the statutory declaration in accordance with clause 14 of Schedule 7 of the Act, witnessed by His Worship the Mayor Hamish McDouall.

Declaration by Members “I, ______, declare that I will faithfully and impartially, and according to the best of my skill and judgment, execute and perform, in the best interests of Whanganui District, the powers, authorities, and duties vested in, or imposed upon, me as a Member of the Whanganui District Council by virtue of the Local Government Act 2002, the Local Government Official Information and Meetings Act 1987, or any other Act.

7. General Explanation of Laws Affecting Members At the first meeting of Council following the triennial general election clause 21(5)(c) of Schedule 7 to the Local Government Act 2002 requires the Chief Executive to give or arrange for a general explanation of the laws affecting Members, including: . Local Government Official Information and Meetings Act 1987; . Local Authorities (Members' Interests) Act 1968 (appropriate provisions); . Crimes Act 1961 (sections 99,105 and 105A); . Secret Commissions Act 1910; and the . Financial Markets Conduct Act 2013.

At Mayor McDouall’s request, Paul Drake, Legal Officer, provided a general explanation of the Council’s procedures and Councillors’ legal responsibilities.

“There are key legal provisions which regulates the way in which Council conducts its business and, in particular, which Elected Members must be aware of; as breaching those rules can have the consequence of loss of office.

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Local Government Official Information and Meetings Act 1987 (LGOIMA) The main focus of LGOIMA is the retention and release of official information held by Council and the conduct of Council meetings; the latter being evidenced by Standing Orders.

The fundamental principle in LGOIMA is that information held by the Council is publicly available, unless one or more specified ground for withholding applies. That principle applies to all information held by Council and includes matters discussed in the public excluded section of Council meetings. The Chief Executive administers the release of official information.

LGOIMA regulates the grounds on which the public may be excluded from a Council meeting; generally only when good reason to withhold information exists as defined in sections 7 and 48 of the Act which includes where the subject matter is one where a right of appeal exists to a Court or Tribunal against the decision made by the Council. Before excluding the public the meeting must pass a resolution stating the subject of each matter to be considered in public excluded and the reason(s) for excluding the public.

The Chairperson of a meeting may ask any member of the public to leave the meeting if that person’s behaviour is likely to prejudice or to continue to prejudice the orderly conduct of that meeting if that member of the public is permitted to remain in that meeting1.

Councillors whose conduct prevents the orderly conduct of the meeting may be asked to leave by the Chairperson under Standing Orders2.

Local Authorities (Members' Interest) Act 1968 (LAMIA) The LAMIA is overseen by the Auditor-General; it is a small but significant part of the legal framework for local democracy. It regulates situations where an elected member’s personal interest impinge on, or could be seen as impinging on, their duties as an elected member.

LAMIA has two main rules: 1. The Contracting Rule No person shall be capable of being elected as or appointed to be or of being a member of Council or of any committee of Council, if the total of all payments made or to be made by or on behalf of Council in respect of all contracts made by it in which that person is concerned or interested exceeds $25,000 in any financial year unless approval has been obtained from the Auditor-General3.

The $25,000 limit relates to the value of all payments made in respect of all contracts, in which the member is interested during the financial year. It does not apply separately to each contract; nor is it just the amount of the profit the

1 Section 50 of the LGOIMA 2 Standing Orders 3.3.9; 3.312; 3.3.13 3 Section 3 of the LAMIA

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contractor expects to make or the portion of the payments to be personally received by the member. The contracting rule also applies to subcontracts. The penalty for breach of this provision is the immediate loss of office and the possibility of a fine being imposed.

2. The Discussing and Voting Rule An elected member shall not vote on or take part in the discussion of any matter in which the elected member has, directly or indirectly, any pecuniary interest, other than an interest in common with the public, unless a statutory exception applies4.

The penalty for breach of the discussing and voting rule constitutes an offence, and on conviction results in vacation of office.

Crimes of Bribery and Corruption It is an offence against section 105 of the Act for an official to seek or obtain a reward for performing their official duties. It is a further offence, under section 105A of the Act for an official to use any information, acquired in their official capacity, to obtain, directly or indirectly, an advantage or a pecuniary gain for them or any other person. Elected members and employees of any local authority or public body come within the definition of ‘official’.

Section 99 of the Act defines ‘official’ as any person in the service of the Sovereign in right of (whether that service is honorary or not, and whether it is within or outside New Zealand), or any member or employee of any local authority or public body, or any person employed in the education service within the meaning of the State Sector Act 1988.

Section 105 Every official is liable to imprisonment for a term not exceeding 7 years who, corruptly accepts or obtains, or agrees or offers to accept or attempts to obtain, any bribe for himself or any other person in respect of any act done or omitted, or to be done or omitted, by him in his official capacity; and that everyone is liable to imprisonment for a term not exceeding 7 years who corruptly gives or offers or agrees to give any bribe to any person with intent to influence any official in respect of any act or omission by him in his official capacity.

Section 105A Every official is liable to imprisonment for a term not exceeding 7 years who, whether within New Zealand or elsewhere, corruptly uses or discloses any information, acquired by him in his official capacity, to obtain, directly or indirectly, an advantage or a pecuniary gain for himself or any other person.

Secret Commissions Act 1910 Every elected member is deemed to be an agent of Council5. Under the Secret Commissions Act it is an offence for a member of a local authority to either corruptly give or agree to offer or give to any agent any gift or other consideration as an inducement to

4 Section 6 of the LAMIA 5 Section 16(1)(b) of the Secret Commissions Act 1910

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reward for any action of forbearance in relation to the Council’s affairs or business, or for showing favour or disfavour to any person, in relation to the Council’s affairs or business.

Financial Markets Conduct Act 2013 (FMCA) The Financial Markets Conduct Act 2013 (FMCA) governs how financial products are created, promoted and sold, and the ongoing responsibilities of those who offer, deal and trade them.

The main purposes of the FMCA are to: . Promote the confident and informed participation of businesses, investors, and consumers in the financial markets. . Promote and facilitate the development of fair, efficient, and transparent financial markets.

The FMCA imposes on elected members the same responsibilities as company directors whenever Council offers securities (debt or equity) to the public. Members may be personally liable if investment documents such as a disclosure statement contain untrue statements and may be liable for criminal prosecution if the requirements of the FMCA are not met.

The Act also prohibits any elected member who has information about a listed company that is not generally available to the market, from trading in that company’s shares or from disclosing that information.

The penalties for certain offences under this Act (false or misleading statements in disclosure documents – 10 years; or insider trading – 5 years) are such that if an elected member was convicted, that conviction would result in ouster from office.

Council at this time does not offer securities to the public therefore the FMCA does not impact on Council’s current business activities.

Public Records Act 2005 Council has a statutory duty to comply with the provisions of the Public Records Act 2005; the Act applies to Councillors in particular to their text messages and emails. It is the content of the communication that determines whether the communication is a public record.

In summary facilitative, transitory, and short term value records, of any format, have only short-term transitory value in their immediate and minor facilitation of preparing a more complete public record. Therefore they are not required for evidential or legal purposes. These records are created through routine administrative and business processes common to most Councils in the course of performing Council’s primary core business functions, duties and responsibilities.

If the content of the message requires action or is potentially of longer-term value and needs to be retained, then its content needs to be retained. In summary elected members should:

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. identify text messages created or received that contain information that is a public record, and . assess the value of the information, and . delete a text message if the information contained in it is only facilitative, transitory and/or short-term value, or . transfer the information to staff responsible for providing recordkeeping support.

Facilitative records Records that are created for the purpose of creating other records and are therefore not required to be maintained for any period of time because they do not provide evidence of business activity. For example, reference material, notes of meetings where a formal record is made.

Transitory records Records that are created for the purpose of helping an action or process move forward but do not in themselves have any value and are not needed to understand the action or process. For example, meeting arrangements, advertising material.

Short-term value records Records that are created for the purpose of completing a routine action or preparing a more complete record and only have temporary value for a finite period of time, or little or no continuing administrative, fiscal, legal, evidential, or historical value. For example, working notes, drafts and revisions.

Recordkeeping "The creation and maintenance of complete accurate and reliable evidence of business transactions in the form of recorded information."

Recordkeeping includes the following: the creation of records in the course of business activity and the means to ensure the creation of adequate records; the design, establishment and operation of recordkeeping systems, including the definition of metadata; and the management of records used in business (traditionally regarded as the domain of records management) and as archives (traditionally regarded as the domain of archives administration).

Local Government Act 2002 (LGA) The LGA is the main piece of legislation defining the power and responsibilities of local authorities. The purpose of the LGA is to provide for democratic and effective local government that recognises the diversity of New Zealand communities.

The LGA: (a) states the purpose of local government; and (b) provides a framework and powers for local authorities to decide which activities they undertake and the manner in which they will undertake them; and (c) promotes the accountability of local authorities to their communities; and (d) provides for local authorities to play a broad role in meeting the current and future needs of their communities for good-quality local infrastructure, local public services, and performance of regulatory functions.

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The Act confers on the elected Council a power of general competence by linking four key enabling sections; the purpose, the role, the core services, and the status and powers, of local authorities.

Purpose of local government The purpose of local government is to enable democratic local decision-making and action by, and on behalf of, communities; and to meet the current and future needs of communities for good-quality local infrastructure, local public services, and performance of regulatory functions in a way that is most cost-effective for households and businesses. Good-quality, in relation to local infrastructure, local public services, and performance of regulatory functions, means infrastructure, services, and performance that are efficient; effective; and appropriate to present and anticipated future circumstances.

The role of local authorities The role of Council is to give effect to the purpose of local government and to perform the duties, and exercise the rights, conferred on the Council under the LGA and any other enactment.

The Core Services In performing its role Council must have particular regard to the contribution that the following core services make to its communities: a) network infrastructure; b) public transport services; c) solid waste collection and disposal; d) the avoidance or mitigation of natural hazards; e) libraries, museums, reserves, and other recreational facilities and community amenities.

Status and powers of local authorities Section 12 of the LGA confers legal capacity on a local authority to undertake the purpose of local government and the role of a local authority. Council is a body corporate with perpetual succession; it has full legal capacity to do anything lawful, subject to any other laws. Council must exercise its powers wholly or principally for the benefit of the Whanganui district. That power of general competence is balanced by the requirements in the LGA for planning and policy making and restrictions on decision making.

General Principles In performing its role Council must act in accordance with nine broad principles; if any of those principles are in conflict the Council must, in an open, transparent and democratically accountable manner, resolve that conflict.

(a) Council should: (i) conduct its business in an open, transparent, and democratically accountable manner; and (ii) give effect to its identified priorities and desired outcomes in an efficient and effective manner.

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(b) Council should make itself aware of, and should have regard to, the views of all of its communities; and (c) when making a decision, Council should take account of: (i) the diversity of the community, and the community's interests, within its district or region; and (ii) the interests of future as well as current communities; and (iii) the likely impact of any decision on the interests referred to in subparagraphs (i) and (ii). (d) a local authority should provide opportunities for Maori to contribute to its decision-making processes: (e) Council should actively seek to collaborate and co-operate with other local authorities and bodies to improve the effectiveness and efficiency with which it achieves its identified priorities and desired outcomes; and (f) Council should undertake any commercial transactions in accordance with sound business practices; and (fa) Council should periodically— (i) assess the expected returns to the authority from investing in, or undertaking, a commercial activity; and (ii) satisfy itself that the expected returns are likely to outweigh the risks inherent in the investment or activity; and (g) Council should ensure prudent stewardship and the efficient and effective use of its resources in the interests of its district or region, including by planning effectively for the future management of its assets; and (h) in taking a sustainable development approach, a local authority should take into account— (i) the social, economic, and cultural interests of people and communities; and (ii) the need to maintain and enhance the quality of the environment; and (iii) the reasonably foreseeable needs of future generations.

(2) If any of these principles … conflict in any particular case, the local authority should resolve the conflict in accordance with the principle in subsection (1)(a)(i).

Governance principles The Governance Principles relate to procedures of the Council and management by staff. (a) should ensure that the role of democratic governance of the community, and the expected conduct of elected members, is clear and understood by elected members and the community; (b) should ensure that the governance structures and processes are effective, open, and transparent; (c) should ensure that, so far as is practicable, responsibility and processes for decision- making in relation to regulatory responsibilities is separated from responsibility and processes for decision-making for non-regulatory responsibilities; (d) should be a good employer; (e) should ensure that the relationship between elected members and management of the local authority is effective and understood.

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In Summary The intention of this brief overview is to bring to the attention of the elected members the main features of key legislation that impacts on local governance. If, at any time, you are in doubt on any of these matters, or are unsure as to whether they may affect you in your capacity as an elected member, please advise the Chief Executive. If the Chief Executive cannot give you the answer there and then, he will ensure that advice is sought to ensure that your position is always protected.”

8. Mayoral Inaugural Address His Worship the Mayor Hamish McDouall provided his inaugural address to the Council.

9. Appointment of Deputy Mayor His Worship the Mayor Hamish McDouall announced the appointment of Jennifer (Jenny) Ruth Duncan as Deputy Mayor.

10. Council Meeting Dates – remainder of 2016

Kym Fell, Chief Executive, reports:

“Mayor McDouall will convene two meetings of the Council – Tuesday, 8 November 2016 and Tuesday, 6 December 2016 – for Council business to the end of this year.

The intended governance structure for the Council commencing January 2017 will be presented at the Council’s meeting on 8 November 2016 together with a proposed schedule of meetings for the Council, Committees and Wanganui Rural Community Board.

Should there be a need for a Hearing – for matters under the Resource Management Act 1991, the Dog Control Act 1996, the Fencing and Swimming Pools Act 1987, or to decide an objection to a temporary road closure, or any other hearing – before the Committee structure is in place, it is proposed that Mayor McDouall together with the Chief Executive, has delegated authority to appoint a Hearings Panel for the specific Hearing.”

Policy on Determining Significance – In terms of the Policy the decision is not significant.

Council’s Resolution Proposed by Mayor McDouall, seconded by Cr Vinsen:

10.1 THAT the Council’s meetings scheduled for Tuesday, 8 November 2016 and Tuesday, 6 December 2016 are noted.

10.2 THAT Mayor McDouall and the Chief Executive have delegation to select members for a Hearings panel if required prior to the establishment of Council committees in early 2017. CARRIED

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11. Council Appointments to Wanganui Rural Community Board

Kym Fell, Chief Executive, reports:

“The Local Government Commission’s Determination (2007) of representation arrangements apply to the Whanganui District Council and Wanganui Rural Community Board elections held on 8 October 2016.

Part of the determination states that the Wanganui Rural Community Board comprises two members of the Council elected by the electors of the Whanganui ‘district as a whole’.

The Council is required to appoint two Councillors by resolution to the Wanganui Rural Community Board.”

Policy on Determining Significance – In terms of the Policy the decision is not significant.

Council’s Resolution Proposed by Mayor McDouall, seconded by Cr Vinsen:

11.1 THAT the Council appoints Cr Josh Chandulal-Mackay and Councillor-elect Murray Cleveland to the Wanganui Rural Community Board. CARRIED

12. Whanganui District Council Annual Report – Year ended 30 June 2016

Mike Fermor, General Manager – Finance, reports:

“Introduction This report is a summary of Council’s Annual Report for the year ended 30 June 2016. The Annual Report will be posted on Council’s website by the end of November 2016. Copies will be made available to the public and Elected Members upon request.

Background The Local Government Act (LGA), The Financial Reporting Act, other relevant legislation and New Zealand International Public Sector Accounting Standards require Council to disclose a large amount of information in the Annual Report. The purpose of the Annual Report is to report on both financial and non-financial performance of the Council by comparing what the Council actually did with what it planned to do.

Council is required, by law, to obtain from an independent third party (Audit New Zealand), their opinion on whether the financial statements and the statement of service performance fairly reflect the results of operations for the year. We are anticipating an unmodified (clear) audit opinion from Audit New Zealand.

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Strategic context The purposes of an annual report as defined by the Local Government Act 2002 (s98(2)) are: (a) to compare the actual activities and the actual performance of the local authority in the year with the intended activities and the intended level of performance as set out in respect of the year in the long-term plan and the annual plan; and to promote the local authority’s accountability to the community for the decisions made throughout the year by the local authority.

Factors to consider  Financial considerations See comments above under ‘Strategic context’.

 Legal compliance The Local Government Act 2002 (s98) requires Council to prepare and adopt an annual report. The annual report must be completed and adopted within four months after the end of the financial year (adopted by the end of October).

 Policy implications Not applicable

 Risks Not applicable

Significance In terms of the Significance and Engagement Policy this report is not significant.

Engagement Not applicable

Assessment of options Not applicable

Discussion The Annual Report details the financial performance of two different entities, ‘Council’ and ‘Group’. The Council is the total of all the Council’s activities as listed in the Annual Plan.

The ‘Group’ consists of aforementioned ‘Council’ plus organisations that Whanganui District Council has significant shareholding in. The major ones are Whanganui District Council Holdings Limited (100% owned), Wanganui Gas Limited (WGL) and its subsidiaries, New Zealand International Commercial Pilot Academy Limited, The Sarjeant Gallery Trust and Wanganui Incorporated.

As ‘Council’ is the entity for which we prepare the Annual Plan and strike the rates, this report will concentrate on these results.

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The Council has four main summary financial statements which have different purposes:

 The Statement of Comprehensive Revenue and Expense (Profit and Loss account) shows income and expenditure for the year, including revaluations and other non- cash items (page 144);  The Statement of Financial Position (Balance Sheet) shows Council’s assets and liabilities (page 146);  The Statement of Cash Flows shows actual money received and spent during the year (page 147);  The Funding Impact Statement shows income and expenditure for the year, excluding revaluations and other non-cash items (page 148).

Results The following is a summary of the key financial results contained in the report. As apparent from discussion below, the dominant reason for most significant variances to budget was the impact of the June 2015 weather event.

Cash Flow Statement (page 147) Net Cash flow from operating activities is effectively all the money the Council received (excluding borrowings), less all the money it paid out (excluding money spent on capital items). The surplus from this was $34,878,000 which is $12,950,000 above budget. The main cause for this variance was the receipt of unbudgeted roading subsidies of $12,067,000 relating to the June 2015 weather event. The timing of receipts and payments also impacts on this variance as well as the variances in income and expenditure discussed below.

Cash flows from investing activities is mainly the money spent on the capital costs of maintaining assets and new capital projects. The Council spent $26,891,000 (net), which was $9,182,000 above budget. This variance was again mainly due to additional roading and other replacement work required as a result of the June 2015 weather event. Major capital projects approved for carryover to 2016/17 due to flood damage works taking priority include:

 Wastewater projects $1,822,000  Wharf upgrade $1,155,000  Stormwater project continuation $2,267,000  Parks and Reserves projects $1,540,000

Cash flows from financing activities show a net decrease in debt of $12,250,000. This decrease in net debt compares to the Annual Plan budget which forecasted a decrease in net debt of $3,706,000. This variance was mainly due to capital projects not proceeding in 2016 as outlined above.

The Cash flow statement shows the Council had a responsible financial year with expenditure being kept within budgetary limits.

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Statement of Comprehensive Revenue and Expense (page 144) The Statement of Comprehensive Revenue and Expense shows a 2016 surplus after tax of $16,192,000. This compares to a budget surplus of $4,092,000. This surplus includes variances in a number of individual line items as listed below:

 Total other revenue (consisting of Subsidies and grants; User fees and other revenue; and Gains) of $39,922,000 was considerably over budgeted income of $19,573,000. This variance related mainly to additional unbudgeted subsidies and grants relating to the flood damage work of $12,423,000. In addition there was unbudgeted receipts of logging income, donations, and a one-off receipt. This additional income was partially off-set by a reduction in water sales, parking income and resource consent fees. In addition to the above there were unbudgeted non- cash Property and Forestry revaluation gains.

 Personnel costs are over budget by $951,000 due to additional staff costs resulting from the June 2015 flood event (of which the majority has been offset by subsidies received), in addition to other subsidised staff costs such as the Gallery Transition project. There were also additional costs associated with a restructure.

 Depreciation and amortisation expense is higher than budgeted by $2,085,000. The unfavourable variance is due to a revision of the estimated useful lives of assets, particularly in the roading network.

 Other expenses has an unfavourable variance of $4,780,000. This was mainly due to an unbudgeted non-cash loss from derivative financial instruments of $4,296,000 as detailed below. The balance is mostly made up of additional unbudgeted costs relating to the June 2015 weather event.

 Finance costs were $286,000 lower than budget due to general market conditions providing lower interest rates and savings from the timing of borrowings.

Each year the Council is required to revalue a number of its assets at 30 June. These revaluations result in non-cash movements in the Statement of comprehensive revenue and expense. The 2016 surplus includes the following non-cash items:

 Decrease in market valuation of derivative instruments $4,296,000. Any movement in long-term interest rates impacts on the valuation of these instruments.

 Increase in market valuation of forestry assets and land and buildings of $4,394,000.

The Statement of comprehensive revenue and expense includes (recorded below Council’s surplus line) a $6,005,000 gain on the revaluation of property plant & equipment.

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Funding Impact Statement (page 148) This statement shows how Council has performed against its Annual Plan. Overall the Council has performed well with an operating surplus of $20,324,000, which is $4,421,000 over budget, mainly due to the reasons outlined above.

This summary statement is the best indication of how we performed against what we planned to do.

Benchmark Ratios The benchmark ratios are included in the disclosure statement in pages (134-143). These measurements are designed to measure the financial prudence of a local authority’s plans and performance.

The benchmarks contain ratios for the current year and previous years comparatives. These ratios are designed to measure Council’s overall rates affordability, debt affordability, sustainability and predictability (i.e. ability to predict debt and cashflows).

The graphs on these pages show the results for 2016 with comparatives for up to the four previous years for many of the ratios. For 2016 Council has met its requirement for all of the benchmarks.

Conclusion Financially the Council has performed well with a rate funded credit balance (as reported at the August 2016 Council meeting), and debt balance of $72,750,000 compared to a budgeted debt balance of $79,814,000. Capital expenditure is well below budget, largely due to projects being deferred. Council approved capital expenditure to be carried over to 2016/17 at its meeting in August 2016.

Council expects again to receive an unmodified (clear) audit opinion from Audit New Zealand.”

Comment Cr Kate Joblin recorded her thanks to Mike Fermor (General Manager – Finance) who, at short notice, had organised Audit New Zealand representatives to attend a workshop to provide an explanation of the Council’s Annual Report.

Policy on Determining Significance – In terms of the Policy the decision is not significant.

Council’s Resolution Proposed by Mayor McDouall, seconded by Cr Duncan:

12.1 THAT the Annual Report for the year ended 30 June 2016 is adopted. CARRIED

Mayor McDouall invited all in attendance to attend the Wanganui Rural Community Board’s First Meeting at which he would take the Board’s Elected Members’ declarations.

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Kaiwhakahaere John Maihi closed the First Meeting of the Council with karakia at 2.51pm.

* * * * *

CERTIFICATE OF CONFIRMATION OF MINUTES

The minutes of the First Meeting of the Whanganui District Council following the 2016 Triennial General Election, held on 26 October 2016, were confirmed as a true and correct record of that meeting at a meeting of the Whanganui District Council held on 5 December 2016.

……………………………………………………….

Hamish McDouall Mayor of Whanganui District

………………………………………………………. Date

Council First Meeting following Triennial Election 26 October 2016