Buller District Council 2011/2012AnnualReport OnlineVersion: To save on both cost and environmental impact, this report has been created with online viewing in mind.

Only a limited number of the printed version have been produced.

www.bullerdc.govt.nz Buller District Council Contents

Overview 5 Message from Mayor and Chief Executive 5

...... Contact Details 9 Mayor and Councillors 11 Inangahua Community Board 13 Statement of Compliance & Responsibility 15 CouncilControlled 101 Governance 17 TradingOrganisations Community Outcomes 19 Westport Airport 101 Financial Highlights 25 Buller Holdings Limited 103 Consultation with Maori 29 WestReef Services Limited 105 Westport Harbour Limited 106 OurWorkinDetail 31 Buller Recreation Limited 109 Democracy 31 Buller Health Trust 111 Community Services 37 Tourism West Coast 112 Environmental Services 47 Emergency Management 53 FinancialStatements 113 Amenities & Reserves 57 Statement of Comprehensive Income 114 Roading & Urban Development 63 Statement of Changes in Equity 115 Water Supplies 69 Statement of Financial position 116 Solid Waste 77 Statement of Cashfl ows 118 Wastewater 81 Notes to the Financial Accounts 121 Stormwater 87 Support Services 91 Accounting Policies 171 In-house Professional Services 97 ...... Westport Harbour 99 ...... Audit Report 185 Contents Buller District Council 5 Mayors&CEOs Introduction

Welcome to Council’s 2011/2012 Annual Report. This Annual Report provides comprehensive information to you, our community, about our activities for the year, the projects we have undertaken and the ser- vices we have delivered. It compares these actions and our financial results to the goals and budgets we set at the beginning of the year to provide accountability and feedback to our residents about how we have performed.

This year was an extremely busy year for Council. Work started on our ten year Long Term Plan (LTP) in December 2011 fi nalising the process in June 2012 with the adoption of our audited 2012-22 LTP. In this plan, we reviewed the existing levels of services across all Council’s activities and confi rmed or amended just what would get done and how we would pay for those things. We also examined the Buller’s economic activity to identify opportunities for Council to work with the community to achieve a prosperous future for the District. Consultation on the Plan began in April 2012 with Roadshows conducted in Westport, Reefton, Punakaiki and Karamea. These question and answer sessions were well attended and gave Councillors the opportunity to listen to your issues and views. The end result was a plan that balanced services provided with affordable costs and addressed some of our key infrastructure upgrades, while maintaining a sustainable and sound fi nancial position.

Completion of a comprehensive and strategic ten year plan was a major milestone for the Council. We are now fi rmly committed to a growth pathway that aims to ensure that the current economic boom enables a long term diversifi ed and sustainable future for the district.

Drinking water quality has remained a contentious issue during the year. Council remains committed to both fi nding a long term solution for the Westport Water Supply and bringing other district schemes up to the Drinking Water Standards. In November 2011 Council made a decision to proceed with a ten year phased upgrade for Westport with a budget of $10.6 million and we were pleased to be successful in obtaining an initial Ministry of Health subsidy of $1.47 million. This upgrade of the Westport water supply will provide consistent and safe water to Westport, as required to meet NZ health standards. Council has engaged Consultants Opus International to undertake project management, investigation and preliminary design, which is likely to continue through to March 2013.

During the year the covered Water Reservoir for the Reefton Water Supply was completed and the water treatment plant commenced. This treatment plant, adjacent The Strand in Reefton, will ensure that water delivered to the residents of Reefton will comply with the Drinking Water Standard of New Zealand and will be completed in 2012. Mayors&CEOsIntroduction 6

OtherKeyIssuesandProjectsworkedonduringtheyearincluded: InfrastructureProjects • Drinking Water Standards subsidies have been approved for Ngakawau-Hector, Waimangaroa and Punakaiki Water Sup- plies • Continuation of the Derby Street upgrade project • Development, review and consultation on the Waste Minimisation Strategy

CommunityFacilities&Services • A decision to lift the hockey turf so that the causes of the performance problems experienced by hockey players could be established. • Council has committed to getting the Buller Hockey Turf fi xed and relaid and has began negotiations with contractors to fi nd a resolution. All parties involved in the original construction of the turf have met, and while progress has been made, no fi nal settlement has yet been reached. • During the fi nancial year architectural designs were fi nalised for the Cultural Hub. Tenders were called for the construction of the Cultural Hub and in June 2012 Council agreed to relocate the Coaltown Museum and I-site into the Cultural Hub and ap- proved the construction of the new facility in Palmerston Street. • The Grants Committee allocated $1.63 million towards community based projects from the Extraordinary Distribution Fund of Development West Coast. This funding has proved crucial in kick starting some key community based projects. • Development and national distribution of the Buller Touring Guide was undertaken, which showcases the tourism attractions and services in all areas of our beautiful District. This 44 page booklet is the fi rst comprehensive guide to the Buller that has ever been produced. Its design complements the themes in our Buller website and makes it easy for visitors to orientate them- selves with the extensive use of maps along with great photographs and local information. We thank our local businesses for the support they have shown for this guide book.

RegulatoryServices • The Planning Department has had a busy year with some complex and resource high profi le consents in the mining sector including Solid Energy’s Mount William Coal Mine application at Stockton and changes to the Globe Hill/Oceana Gold consent in Reefton. • The Building Control Function has once again achieved accreditation after the two yearly audit in December 2011. • More active monitoring of licensed premises has taken place over the last 12 months by the three agencies - Council (District Licensing Authority), the Police and Community and Public Health with various enforcement actions being undertaken to address non-compliance. • The Planning Department has also been heavily involved in progressing the resolution of appeals made through the Environment Court appeal process in relation to Buller Coal Holdings coal mine application and the Meridian/Mokihinui hydro power scheme. • Council gave its fi nal approval to the fi rst two sets of the Buller District Plan on 21 September 2011. These changes became a fully operative part of the Buller District Plan on that day. • There has been extensive consultation with our community on the Freedom Camping Bylaws.

WestportHarbour • There has been ongoing collaboration between Westport Harbour Ltd and Bathurst Resources Ltd. The intention is to develop a long term sustainable shipping business for West Coast coal and prospects for this opportunity are good. • All this bodes well for development and economic growth in the Buller. At the same time to strengthen and under- pin the importance of developing a diversifi ed economy Council has changed the future focus of the Promotion and Development offi ce to an Economic Development role.

Buller District Council 7

In April 2012 we received the great news that Buller was the leader in the Business and Economic Research Ltd (BERL) re- gional rankings report for economic growth. According to the BERL report for 2011, Buller was the best performing local authority in New Zealand. Out of the nine ranking indicators Buller topped four to gain this coveted top spot. In 2011 Buller had the high- est employment and business unit growth for the country and over the past fi ve years we have had the best employment and GDP growth of all the districts throughout New Zealand.

Buller District Council does not operate in isolation and in the background of our day-to-day work the Local Government sector continues to be reshaped by extensive reform and legislative change. The proposed Better Local Government reforms, changes in the Liquor Licensing Act and the impending building consent changes that are expected from the Christchurch Royal Commission of Enquiry are some of the external challenges we face.

The last year has also produced intensive focus on Council debt by central government and the media. I am pleased to report that currently our Council has a net debt profi le of $9.3 m after a period where we have tackled some major infrastructure and com- munity projects which have vastly improved our levels of service to the Buller community. Even with some large projects scheduled over the next ten years we are committed to keeping net debt at conservative levels while matching capital costs over the life of these assets.

After many decades of deferring major capital expenditure in the face of declining population the current generation has been forced to fund the inevitable catch up. That has placed enormous strain on the Council and its ratepayers. Fortunately we are through the worst of it, and if we can maintain the present growth cycle, the additional ratepayers will help ease the individual burden on each ratepayer. SummaryofFinancialPerformancefortheyear Council is reporting a bottom line ‘Comprehensive Income’ surplus of $13.3 milion. This is a favourable variance against an original budget prediction of a Comprehensive Surplus of $6.2 million, however, $13.8 million of this surplus was due to biennial asset valu- ation gains. The original budget preduction for these gains was $4.6 million in 2011/2012 and $4.5 million in 2010/2011.

At an operating level Council recorded a small defi cit of $0.5 million, instead of the surplus of $1.6 million originally budgeted. Much of this shortfall can be attributed to a variety of one-off events such as the impairment provision in respect of Council’s shareholding in Buller Recreation Limited ($679,000), changes in the accounting treatment of some Council building maintenance expenditure ($130,000), various asset right-offs or loss on sales ($515,000), a loss on derivative contracts ($259,000).

When these one-off transactions are removed the underlying operating position of Council shows an increase in operating costs of about $1.4 million. This increase in operating costs is the result of increased activity. There has been an increase in operating revenue of about $1.5 million too.

Council’s net cash and net debt position has improved by $1.7 million.

This improvement in Council’s net debt position was primarily due to Council not spending as much as had originally been pre- dicted on its capital works programme. In the 2011/2012 budget Council had expected to spend more than $10 million acquiring additional fi xed assets. Not all these projects have occurred as scheduled and in particular delays in proceeding with the Cultural Hub project and three of the drinking water improvements are not suffi ciently advanced to be recorded in the accounts cut-off for 30 June 2012. However, the costs of these projects and any subsidy contributions will fl ow through in next year’s accounts.

The overall result for Council is a signifi cant improvement on the defi cit recorded in the 2010/2011 year. While the result does show several variations from the original budget projections, these variations are largely the result of one-off unbudgeted events. Overall, the improvement in shareholders equity and the further reduction in net debt are satisfactory indicators of Council’s overall fi nancial health.

Pat McManus - Mayor Paul Wylie - Chief Executive 31 October 2012 31 October 2012 Buller District Council 9 Contact Details

BroughamHouse

4-6 Brougham Street Phone: [03] 788-9111 PO Box 21 Fax: [03] 788-8041 WESTPORT 7866 Freephone: [0800] 807-239 Email: [email protected]

ReeftonServiceCentre

66 Broadway Phone: [03] 732 8821 PO Box 75 Fax: [03] 732-8822 REEFTON 7851 Freephone: [0800] 807-821

SueThomson-CaseyMemorialLibrary

87-89 Palmerston Street Phone: [03] 788-8030 WESTPORT 7825 Fax: [03] 788-8147

www.bullerdc.govt.nz Buller District Council 1111 Mayor& Councillors

left from front: Councillor’s David Barnes, Graeme Neylon, Graham Howard, Jim Halsall and Dave Hawes centre: His Worship the Mayor, Pat McManus right from front: Councillor’s Fred Ratahi, Margaret Montgomery, Rosalie Sampson, Peter Campbell and John Hill 12

Mayor Pat McManus (Mayor - Buller District) First Elected: 2000 Phone: [03] 789-7013 | [027] 208-7583 Email: [email protected]

Westport Ward David Barnes Peter Campbell First Elected: 2007 First Elected: 2007 Phone: [03] 789-6494 | [021] 159-1593 Phone: [03] 789-6421 | [027] 434-8157 Email: [email protected] Email: [email protected]

Jim Halsall John Hill First Elected: 2007 First Elected: 2010 Phone: [03] 789-7546 (private) Phone: [03] 789-6415 | [021] 199-7155 Email: [email protected] Email: [email protected]

Graham Howard Margaret Montgomery First Elected: 2010 First Elected: 2004 Phone: [03] 789-8787 | [027] 534-3129 Phone: [03] 789-7043 | [027] 433-6016 Email: [email protected]

Seddon Ward Fred Ratahi Rosalie Sampson First Elected: 1998 First Elected: 1989 Phone: [03] 782-8119 Phone: [03] 782-6745 | [027] 356-7388 Email: [email protected]

Inangahua Ward Dave Hawes Graeme Neylon First Elected: 2007 First Elected: 1992 Phone: [03] 732-8423 Phone: [03] 732-8382 | [027] 431-4659 Email: [email protected] Email: [email protected]

Buller District Council 13

Inangahua Community Board Jenette Hawes (Chair) First Elected: 2004 Phone: [03] 732-8423 Email: [email protected]

Helen Bollinter First Elected: 2008 Phone: [03] 732-8123 Email: [email protected]

Barrie Fowler First Elected: 2008 Phone: [03] 732-8488 Email: [email protected]

Megan McCarthy First Elected: 2007 Phone: [03] 732-7006 Email: [email protected] Buller District Council 1515

Statementof Compliance&Responsibility

Compliance The Council and Management of the Buller District Council confi rm that all the statutory requirements in relation to the An- nual Report, as outlined in the Local Government Act 2002, have been complied with.

Responsibility The Council and Management of the Buller District Council accept responsibility for the preparation of the Annual Financial Statements and the judgements used in them. The Financial Statements are unable to be amended following issue.

The Council and Management of the Buller District Council accept responsibility for establishing and maintaining a system of internal control designed to provide reasonable assurance as to the integrity and reliability of fi nancial reporting.

In the opinion of the Council and Management of the Buller District Council, the Annual Financial Statements for the year ended 30 June 2012 fairly refl ect the fi nancial position and operations of the Buller District Council and Group.

Pat McManus - Mayor Paul Wylie - Chief Executive 31 October 2012 31 October 2012 Buller District Council 1717

Governance

Council complies with the laws of New Zealand and adheres to good business practice by relying on the processes and systems which constitute the fabric of the organisation. Stakeholders rely on these processes to obtain information on Council operations and to obtain assurance that Council is working in the best interest of the community. This section identifies the parameters within which the business of Council is run.

Division A key to the effi cient running of the Council is the clear division between the role of Council and that of manage- ment. The Council concentrates on setting policy and strategy, then reviews progress. Management is concerned with implementing the policies and strategies.

While many of the Council’s functions have been delegated, the overall responsibility for achieving the vision and goals of the district ultimately rests with the Council. The Council discharges this responsbility by maintaining ef- fective systems of internal control. Internal control includes the policies, systems and procedures established to provide measurable assurance that specifi c objectives of the Council will be achieved.

TrainingElectedRepresentatives After each election the Council holds training sessions for all Councillors to review their responsibilities as elected members. These sessions include meeting procedures and an overview of the legislative parameters within which local authorities operate.

LegislativeCompliance Being a regulatory body, the Council administers various regulations and laws. As such, it is vital the Council also complies with all relevant legislation.

Audit The Local Government Act 2002 requires the Council to prepare fi nancial statements that fairly refl ect the organisa- tion’s fi nancial position, performance and cashfl ows. In addition, the Council is required to report on the achieve- ment of non-fi nancial objectives, set three yearly as part of the Long Term Plan process.

Section 15 of the Public Audit Act 2001 requires the Auditor-General to audit both fi nancial and non-fi nancial state- ments. Audit New Zealand is contracted to perform the audit on behalf of the Auditor-General.

InternalAudit The Council has an internal audit function which is responsible for monitoring the Council’s systems of internal con- trol and the quality and reliability of fi nancial information reported to the Council. The Council liaises closely with the external auditors who review the internal control systems to support their audit opinion.

MonitoringCouncilControlledOrganisations The Council has interests in other organisations, these include Buller Holdings Limited, Westport Harbour Limited, WestReef Services Limited, Buller Recreation Limited and Westport Airport Authority. These organisations are re- quired to produce a Statement of Intent developed in consultation with Council.

Other interests of Council include Buller Health Trust where the Mayor and Chief Executive are Trustees, Tourism West Coast where Council appoints two board members, Buller Art and Recreation Trust (BART) where one Councillor is a Trustee and Denniston Heritage Charitable Trust where two Trustees are appointed by Council. Buller District Council 1919

Community Outcomes

The Local Government Act 2002 has prompted changes in the way which Council plans for the future of the district. It also provides greater scope for communities to make their own choices about what Council does and the way in which it does these things.

The legislation requires Council to undertake a process, at least every six years to identify community out- comes.

These outcomes are determined by the community, rather than by Council. However, they do provide Council with clear direction in planning by forming the basis for the Long Term Plan.

In 2005 Council facilitated a full community outcomes consultation for the Buller District. Council staff re- viewed the feedback received during the consultation process and an overview report “Mapping A Future For Buller” was produced. After publishing the results and providing an opportunity for comment, Council was satisfi ed that we had refl ected what was important to the community.

Thefollowingsixhighleveloutcomeswereidentified:  Health  Education

 Safety  Environment  Economy

 Identity CommunityOutcomes 20

Health We will know we are succeeding when we: How will progress be measured:  Provide essential services to residents and businesses to  Food premises inspections support a healthy environment  Sewerage disposal services  Promote opportunities for community access to health  Waste management information and participation  Water supply

 Advocate for local community on health issues/services  Healthy homes  Establish an environment of support and assistance to  Support alcohol and drug education initiatives health providers  Support for community health initiatives

 Sports and recreation facilities  Cemetery management  Buller Health Trust  Activity support recruitment of medical professionals  Health information provided in libraries  Work closely with West Coast District Health Board  Work with Department of Conservation to improve participation and enjoyment

Education We will know we are succeeding when we: How will progress be measured:  Provide a supportive environment for education providers  Library services  Recognise and support education excellence and  Grant activities opportunity in the district  Relationships with education providers  Advocate for local community in provision of education  Support for literacy programmes services and related issues  Support the implementation of employment and training  Education programmes initiatives that offer improved employment, skill and  Youth worker networks income opportunities  Promote friendly Local Government  Road Safety networks  Celebrate community and individual achievements  Road education safety  Provision for pool facilities and sports grounds  Scholastic awards to local students  Support for learning and education initiatives and competitions  Support for school programmes and curriculum  Internet access at libraries  Advocate for suport of training initiatives

Buller District Council 21

Safety We will know we are succeeding when we: How will progress be measured:  Provide and develop safe public places  Animal control activities  Assist in reducing crime and accident levels  Liquor licensing and bans  Promote friendly Local Government and provide  Enforcement and monitoring opportunity for involvement  Elderly Housing  Provide opportunity for the community to work in  By-laws partnership with Council  Youth worker networks

 Welcome residents, businesses and visitors  Civil defence, rural fi re and emergency management  Celebrate community and individual achievements  Road and traffi c safety/user safety  Recognise and support those with special needs and  Hazard identifi cation/lifelines requirements  Community awards (host responsibility)  Townwatch and security cameras  Safety initiatives and projects  Street lighting, road cleaning and vegetation control  Consultation policies and practices  Support for community projects/groups  Communication policies and practices  Disabled access, building control/priority paths

Environment We will know we are succeeding when we: How will progress be measured:  Develop policies and implement practices that enhance  District Plan our environmental sustainabllity and natural diversity  Resource consent process  Recognise and preserve the essential elements of the  Monitoring and enforcement district’s landscape that contribute to Buller’s unique  Waste management natural identity.  Ensure that planning processes enable effective public  Harbour management consultation over an appropriate balance between the  District promotion natural and built environment  Develop practices that help to improve cleanliness and  Relationship with Department of Conservation sustainability of the districts infrastructure  Road upgrade improvements  Access central Government funds to support  Wastewater/sewerage projects infrastructure development and improvement  Parks and reserves maintenance  Maintenance and development of walkways  Support/implement community projects, ie beach cleanups  Relationship with key industries  Town planning/urban design 22

Economy We will know we are succeeding when we: How will progress be measured:  Develop policies and implement practices that enhance  District promotion our environmental sustainabllity and natural diversity  Support of Business Assocation and Buller  Recognise and preserve the essential elements of the Promotions Association district’s landscape that contribute to Buller’s unique  Building consent liaison with businesses/ natural identity. developers  Ensure that planning processes enable effective public  Road improvements to support industry consultation over an appropriate balance between the  Relationships with key industries natural and built environment  Develop practices that help to improve cleanliness and  Film and business friendly strategies sustainability of the districts infrastructure  Street enhancements and urban design  Access central Government funds to support  Purchasing policy infrastructure development and improvement  District Plan reviews  Mayor’s Taskforce for Jobs  Transport infrastructure: airport/harbour/ roading  Support to health and education providers

Identity We will know we are succeeding when we: How will progress be measured:  Support and encourage community groups and  Libraries and theatres organisations providing events within the region  Sports facilities and community halls  Provide a range of arts, cultural, recreation and social  Community Grants facilities throughout the district  Facilitate Creative New Zealand grants  Encourage and support other organisations in providing  Support to cultural organisations such as arts, cultural, recreational and social facilities museums throughout the district  Ongoing support of events

 Provision of appropriate infrastructure to support a  Provision for public toilets/facilities vibrant community  Maintenance of parks and reserves  Facilitate community grant process to assist in the  Road and signage provision of events and services that support a vibrant  Urban design community  Visitor information  Camping ground  Replacement of pools/sports venues  New or upgraded theatre facilities

Buller District Council 23

As required by Section 92 of the Local Government Act, we have finalised monitoring documents on the Community Outcomes, together with the Regional Council and other local District Councils on the West Coast. It was agreed that this would be jointly done to expedite the process and to achieve cost and efficiency synergies.

To-date indicators across all outcomes have been agreed and draft monitoring reports have been fi nalised. The District Council’s and Regional Council have met quarterly to achieve agreement on the community outcome indicators and have chosen indicators based on consultation with Statistics New Zealand and the Department of Internal Affairs. It is important also that the indicators chosen are both meaningful to the community and data to measure progress is readily available. It was agreed that the Regional Council would take a lead role in consolidating the draft monitoring reports. Monitoring reports were fi nalised during June 2009 and were made publicly available.

During 2011 as part of the Long term Plan process Council consulted on its community outcomes. This resulted in a change to the Community Outcomes for the Long Term Plan.

New Community Outcomes in the Long Term Plan are

1. Well-being

2. Learning 3. Who we are

4. Sustainable Environment

5. Prosperity

Community Outcomes are identifi ed as the outcomes which a local authority aims to achieve in order to promote the social, economic, environmental, and cultural well-being of its district or region, in the present and for the future. Buller District Council 2525

Financial Highlights

AnnualReport This summary provides an overview of the information contained in the Annual Report for 2011/2012 financial year. We have prepared it to help you understand how we performed against our plans for that particular year and includes details of any significant variances in operational and capital expenditure.

Council is reporting a bottom line ‘Comprehensive Income’ surplus of $13.3 milion. This is a favourable variance against an original budget prediction of a Comprehensive Surplus of $6.2 million, however, $13.8 million of this surplus was due to biennial asset valuation gains. The original budget preduction for these gains was $4.6 million in 2011/2012 and $4.5 million in 2010/2011.

At an operating level Council recorded a small defi cit of $0.5 million, instead of the surplus of $1.6 million originally budgeted. Much of this shortfall can be attributed to a variety of one-off events such as the impairment provision in respect of Council’s shareholding in Buller Recreation Limited ($679,000), changes in the accounting treatment of some Council building maintenance expenditure ($130,000), various asset right-offs ($515,000), a loss on derivative contracts ($259,000).

When these one-off transactions are removed the underlying operating position of Council shows an increase in operating costs of about $1.4 million. This increase in operating costs is the result of increased activity. Operating revenue increased about $1.5 million too.

Council’s net cash and net debt position has improved by $1.7 million.

This improvement in Council’s net debt position was primarily due to Council not spending as much as had originally been predicted on its capital works programme. In the 2011/2012 budget Council had expected to spend more than $10 million acquiring additional fi xed assets. Not all these projects have occurred as scheduled and in particular delays in proceeding with the Cultural Hub project and three ofthe drinking water improvements are not suffi ciently advanced to be recorded in the accounts cut-off for 30 June 2012. However, the costs of these projects and any subsidy contributions will fl ow through in next year’s accounts.

The overall result for Council is a signifi cant improvement on the defi cit recorded in the 2010/2011 year. While the result does show several variations from the original budget projections, these variations are largely the result of one-off unbudgeted events. Overall the improvement in shareholders equity and the further reduction in net debt are satisfactory indicators of Council’s overall fi nancial health.

OperatingRevenue Council achieved additional revenue of $1.5 million in comparison with the budget. The total operating revenue was $23.7 million versus budgeted revenue of $22.2 million. This favourable variance is mainly due to additional fi nan- cial assistance received ($148,000), investment income ($320,000) and higher than anticipated fees and charges ($915,000). FinancialHighlights 26

FinancialAssistance Council received fi nancial assistance which totalled $5.2 million versus a budget of $5.0 million. This is mainly attributable to the following.

The additional amount received in fi nancial assistance was due to the recognition of the sponsorship for the Cultural Hub which had in prior years been treated as Revenue Received in Advance. Revenue totaling $830,000 was recognised in this fi nancial year when the project was approved by Council on 27 June 2012. Contributions budgeted to be received within the 2011/2012 totalling $500,000 were not received due to late approval of the project which hindered further fund raising. Overall there was a favourable variance for sponsorship income for the Cultural Hub project of $330,000.

Unbudgeted external sponsorship income for the NBS Theatre and Solid Energy Centre and contributions from the Develop- ment West Coast Extraordinary Fund for community based projects accounted for a further favourable variance of ($722,000).

Lower than planned income from New Zealand Transport Authority (NZTA) was recorded. Variations are to be expected as there are cyclical variations in the agreed three year approved Roading programme with NZTA.

In addition the Waimangaroa and Ngakawau- Hector Drinking Water Upgrades were deferred to 2012/2013 which resulted in no fi nancial assistance being received for these upgrades. Lower than anticipated subsidies for the Reefton and Punakaiki schemes were received as both these upgrades were still in progress at year end. The reduction in fi nancial assistance for the water upgrades totalled $725,000.

DividendIncome Dividend and subvention income received totalled $1.3 million versus a budgeted amount of $825,000.

This is due to the fact that Council received the 2010/2011 dividend of $580,000 from the Holding company in the 2011/2012 fi nancial year. During the year Council received a total of $521,000 ($245,000 as a dividend from Buller Holdings and $276,000 as a subvention payment from Westreef Services) against a 2011/2012 budgeted dividend/ subvention income of $825,000.

FeesandCharges Fees and charges received totalled $4.4 million versus a budget of $3.5 million. This is due to lease income of $208,000 from Westport Harbour and unbudgeted income from the Domain Boards of $353,000. A budget error in the Fees and Charges for dog registration income resulted in the budgeted income being understated by $319,300.

RevaluationofInvestmentLand Revaluation of investment land was $141,000 more than budgeted. This favourable increase is market driven.

OperatingExpenditure Operating Expenditure incurred totalled $24.4 million versus budgeted expenditure of $20.6 million. This unfavourable vari- ance of $3.8 million is explained below.

EmployeeBenefitExpenses The overrun in employee benefi t expenses is due to an unbudgeted correction of prior year health care expenses and un- budgeted provisions for retiring gratuities, employee entitlements and long service leave ($123,000).

Depreciation Depreciation is $212,000 above budget due to the non funding of depreciation for certain assets which are funded from Reserve Contributions or from external subsidies. Depreciation is not provided for in the budget but is accounted for in the fi nancial statements. Depreciation was unbudgeted for the Harbour but this was offset by the lease income.

Buller District Council 27

FinanceCosts Finance costs were $271,000 lower than budgeted due to lower than anticipated interest rates and the deferral of major capital projects such as the Cultural Hub and Waimangaroa, Ngakawau-Hector Drinking Water Upgrades.

OtherExpenses Other expenses incurred exceeded budget by $ 2 million. This is mainly attributable to subsidiary transactions ($875,000) and overruns in expenditure ( $1,125,000)

SubsidiaryTransactions Change in accounting treatment at year end for painting resulted in unbudgeted expenses totalling $130,000 being recog- nised.

Recognition of the obligation at year end to Buller Recreation for the remediation of the hockey turf ($745,000)

ExpenditureVariances

• Unbudgeted grants for Vision 2010 projects not owned by Council (Reefton V2010 projects - $63,000; Seddon - $5,000) • Unbudgeted legal and consultant expenses associated with preparation for the hockey turf dispute with contractors ($64,000) • Predicted budget effi ciencies not materialising for Repairs and Maintenance in Parks and Reserves ($120,000) • Greater usage of external consultants to assist with the higher workload associated with signifi cant increase in re- source consents and for complex high profi le resource consents ($133,000). This was offset by higher income levels which resulted in the full recovery of this expenditure. • Domain Board expenditure required to be included in the fi nancial statements but not included in council budgets ($295,000) • The overrun on solid waste composting costs ($66,000) occurred because of the shortage of greenwaste material taken to the transfer station. The activated sludge waste water treatment plant produces biosolids on a daily basis as part of the treatment of sewage. The biosolids need to be disposed of and the production of compost is a safe and productive way of dealing with biosolids. The overrun on the production of compost should not be taken out of context as it is one aspect of the waste water treatment. Overall the Westport wastewater was 4.7% over budget. • Greater costs in contract supervision and repairs and maintenance in Reefton, Westport, Waimangaroa totalling $61,000. This is associated with the repeated backwash pump failures in Westport, a higher than anticipated volume of repairs in Reefton and trunk main repairs in Waimangaroa. • Higher than anticipated costs of operating the landfi ll and transporting the refuse and recycling ($83,000) were re- corded. Once again effi ciencies envisaged in the budget did not materialise. • Council paid $256,000 towards power and heat for Buller Recreation which is accounted for under “other expenses”. This is offset by the contribution totalling $157,000 under “fees and sundry”. The expense budget was exceeded by an amount of $33,000.

Revaluation Council revalued its infrastructural assets during the 2011/2012 fi nancial year and this infrastructural resulted in the increase in the revaluation reserve totalling $13.8 million. Buller District Council 2929

Consultationwith Maori

An opportunity for Maori to contribute to the decision making processes of the Local Authority

The Buller District Council continues to participate in local kaitiaki ropu meetings with local Iwi and the Department of Conservation as appropriate. Iwi have indicated that addi- tional liaison groups, such as an Iwi Liaison sub-committee would pose resource issues for them at this time. The public forum available before all Council meetings have been utilised over the past year by local Maori to raise con- cerns or issues with Council. Both the Papatipu Runanga - Ngati Waewae and local com- munity groups working with Maori are included on Council’s stakeholder database and are included in information dissem- ination such as Council newsletters and consultation docu- ments. Ngati Waewae was included in stakeholder group discussions prior to consultation within the district on community out- comes. ConsultationwithMaori Buller District Council 3131

Democracy

Whatdowedo? Council is an elected body that provides a governance structure for effective leadership, advocacy and accountable stewardship of the Council’s assets and resources.

The Council is made up of the Mayor, 10 elected Councillors and the Inangahua Community Board. They are sup- ported by a Chief Executive and Council staff. Under the Local Government Act 2002, our statutory roles are:

• To enable democratic local decision making and action by and on behalf of the people of the Buller District • To promote the social, economic, environmental and cultural wellbeing of the Buller District, in the present and in the future

The Council develops strategies and policies which set the direction for the future of the Buller District Council by including the democratic and decision making processes of Council such as informing the public, generating feedback and involving people in the decision making process.

Whydowedoit? Council wish to ensure that the community is satisfi ed that the Buller District Council is effectively governed and managed. The Council’s purpose is to enable democratic decision making at a local level by and on behalf of our communities, to promote the social, economic, environmental and cultural wellbeing of our communities now and into the future to meet legal requirements and statutory deadlines.

ContributestowhatCommunityOutcome? Democracy supports all the community outcomes as it provides the governance and the opportunity for civic engage- ment.

HowCouncilPerformed Buller2050 The Buller 2050 Strategic Plan aims to develop a strategy for actions that will determine where the region will be in 2050. The Council is aware that relying on extractive industries alone will not provide long term security for the region. Mining will be the spring board but other economic growth opportunities must be pursued to diversify our economic base. Work on the Buller 2050 project drifted over the past twelve months. The project will be reacti- vated during 2012/2013 with a view to developing widespread community consensus on the way forward for the whole District.

The Chief Executive undertook a visit to Western Australia to investigate the model of Royalties from Mining paid to regions to fund local infrastructure development and to review plans for the development of miningtowns in Western Australia. These plans will prove useful for Westport where we are trying to ensure that the forecast growth in new mining activities stays invested in the region.

There is currently legislative changes being made to the Crown Minerals Act and Local Government New Zealand have prepared a submission to lobby Government for obtaining royalty funds for the region. The Chief Executive has met with the Minister in this regard. Democracy EngagementwithMaori During the 2011/2012 fi nancial year Ngati Waewae were consulted regarding the Community Outcomes. 32

CouncilPriorities Council continued to work on the list of top 10 priorities identifi ed in November 2010. First on the list was development of a long term solution for Westport water. The current system is no longer able to meet the latest drinking water standards issued by central Government so a long term solution needs to be implemented. A Water Group was created to ensure that decisions made can last for 50-100 years. In November 2011, Council was provided with three options:

1. Upgrade the existing supply at a cost of $10.6 million 2. Change the source of supply to the Buller River with a gravity fed system ($15.6 million) 3. Change the source of supply to the Buller River with a pumped fed system ($13.4 million) At the November 2011 Council meeting Council approved a phased upgrade of Westport Water Supply was approved, totalling $10.6 million over the next 10 years. Council will consider the fi nancial impact during the 2012/2013 year of upgrading the water supply over a shorter period. Council has continued to work closely with the West Coast District Health Board (WCDHB) and Ministry of Health (MoH) on the development of an integrated Family Health Centre.

LongTermPlan On 27 June 2012, Council adopted its Long Term Plan for 2012-2022.

Several workshops were held with Council to review the current level of service for the various Council activities. Council spent considerable time developing the current Long Term Plan and debating what services and projects need to be under- taken. Prioritising the services and activities was no easy task for Council.

Councillors and staff held Long Term Plan Roadshows in Karamea, Reefton, Punakaiki and Westport. Council listened to the views of the community on key issues highlighted such as the Westport Water Upgrade.

Our infrastructure and rebuild programme sees just over $57.7 million invested across the district over the ten years.

The Ten Year Plan shows our Council to be in a sound fi nancial position with sustainable increases in borrowings despite a signifi cant capital expenditure programme to maintain and upgrade aging infrastructure.

The Plan initiated the development of the Westport Concept Plan – a concept plan for a new look Westport town. Given the anticipated growth in mining activities, the Westport plan will address issues such as the roading hierarchy, streetscapes, tree planting and land zoning.

Council also signalled its intention that effective from 1 July 2013 we intended to move from a Council delivered waste dis- posal system to a service managed by a contractor.

Buller District Council 33

KeyPerformanceIndicators What we did What we measured TARGET ACTUAL To provide a gov- All meetings notifi ed as per legislative 100% All meetings notifi ed as required ernance structure requirements (Local Government Offi cial (2011: no change) and to develop Meetings Act “LGOIMA”) and Standing strategic direction Orders for the future of the Buller district Minimum notifi cation period of fi ve days but this notifi cation period must not exceed 14 days If meeting after the 21st day of the month minimum notifi cation is fi ve days but notifi cation period not to exceed 10 days % of agendas and reports available from 100% 100% Council two clear working days prior to (2011: no change) each meeting % attendance of Council members at 90% 88% at Council Meetings various Committee and Working Group (2011: 94% at Council Meetings) meetings % of Council meetings that are run ac- 90 - 100% All Council meetings are run according cording to statutory requirements range to statutory requirements. Nil breaches of legislation noted. (2011: no change) To engage and edu- % Residents who are satisfi ed with the 60% Survey was undertaken in November cate members of the way Council involves people in decision satisfaction 2010 community in mat- making No survey was planned to be carried ters of importance out in 2011/2012 in our district The leading priorities that were identi- fi ed by residents as actionable include As a result of the survey Council water supplies, sewerage, waste man- formalised a list of priorities at the No- agement and stormwater drainage vember 2010 meeting which includes a ‘long term view’ of the Westport Water Supply upgrade and long term solution for Buller refuse Council has continued to focus on these priorities and develop long term solutions for Westport water and Buller Refuse In November 2011 Council agreed to a phased upgrade of the Westport Water Supply over 10 years In the Long Term Plan Council signalled a move to a service where the refuse collection, transfer station and landfi ll would be operated by an independent contractor Council has also continued to obtain a designation for the proposed landfi ll, should this be required Number of meetings held with Maori Two formal Ngatai Waewae were consultated with meetings per regards to the Community Outcomes. annum (2011: Nil meetings held but consulta- tion over proposed landfi l site) % of consultations undertaken in compli- 90 - 100% Consultations were undertaken and ance with legislation through evaluation range all legislative requirements were met of consultation procedure (100%). (2011: no change) % of Agenda items in open Council 90% 90% (2011: no change) 34

KeyPerformanceIndicators

What we did What we measured TARGET ACTUAL Co-ordination of an- Adoption of Long Term Council Plan and Meet required Met required statutory deadlines for nual budgeting and Annual Plan within statutory timeframes statutory adoption of required reports. fi nancial planning with an unqualifi ed opinion on Long Term deadlines (2011: no change) processes and prepa- Plan for adoption ration of Long Term of required Plan and Annual Plan reports Provide timely and Adoption of Annual Report Meet required Met required statutory deadlines for accurate fi nancial statutory adoption of required reports information to Man- deadlines (2011: no change) agement and Council for adoption to enable effec- of required tive monitoring and reports reporting of fi nancial performance

Buller District Council 35

FullCouncilMeetingattendance Date Number of Attendees Councillor not in Attendance July 2011 11 Nil August 2011 10 Ratahi September 2011 9 Halsall, Howard October 2011 9 Neylon, Ratahi November 2011 10 Ratahi December 2011 11 Nil January 2012 11 Nil February 2012 9 Neylon, Ratahi March 2012 7 Campbell, Hill, Neylon, Montgomery April 2012 10 Montgomery May 2012 11 Nil June 2012 8 Hawes, Neylon, Sampson Summary 12 Meetings Held Average % of Attendance 88%

InangahuaCommunityBoardattendance Date Number of Attendees Member not in Attendance August 2011 6 Nil October 2011 4 G Neylon, M McCarthy December 2011 3 D Hawes, H Bollinger, G Neylon February 2011 4 H Bollinger, G Neylon April 2012 4 M McCarthy, B Fowler June 2012 4 M McCarthy, D Hawes 36

2011/2012 2011/2012 2010/2011 Democracy Actual Budget Actual $(000) $(000) $(000)

OPERATING Revenue Fees and Sundry 0 10 31 Financial Assistance 0 0 13 TOTAL Revenue $0 $10 $44

OPERATING Expenditure Employee Benefi t Expenses 213 228 218 Depreciation and Amortisation 0 0 0 Finance Costs 0 0 0 Other Expenses 601 567 627 TOTAL Expenditure $814 $795 $845

NET Cost/(Surplus) of Services $814 $785 $801

CAPITAL EXPENDITURE $0 $0 $0

ExplanationofSignificantOperatingVariances No signifi cant operating variances noted.

SignificantCapitalExpenditure No capital expenditure undertaken.

ExplanationofSignificantCapitalExpenditureVariances No capital expenditure undertaken.

Buller District Council 3737

Community Services

Whatdowedo? A community is enhanced through the provision of services that deliver to the cultural and recreational needs of residents.

CommunityGrants&Funding The Council provides funding directly to community organisations, as well as managing the distribution of various government funding for the arts, sporting and safety initiatives.

DistrictPromotion&Development,TourismSupport&Events We introduced a District Promotion and Development Targeted Rate in the 2009/2010 fi nancial year based on a tiered fl at rate in conjunction with a capital charge, targeting tourism operators who advertise and all commercial/ industrial ratepayers. This rate funds tourism grants for local I-sites and promotions groups as well as providing the budget for the Promotion & Development Offi ce to run tourism-based marketing initiatives for the region as a whole.

The original Buller Visitor Strategy that was included in the 2006-2009 Long Term Plan has consistently been used as the framework for all promotion and development projects. The recommendations and plans that came out from the Buller Promotion and Development Strategy, Buller Promotion and Development 2011-2015 Marketing Plan and Special Project Plan have driven all promotion and marketing initiatives.

The Promotion and Development Co-ordinator meets regularly with industry stakeholders and governing bodies to secure support and direction.

There has been solid buy-in and support from the Tourism industry and a number of marketing campaigns and initia- tives have recently been rolled out: Buller Regional Touring Guides and South-Island wide distribution, increased search engine optimisation and Google ad campaigns for the regional website. We have also constructed a 5 panel, 11 metre long regional display system that is for both tourism and regional promotional use. The region has also been heavily represented at the Tourism Export Council (TEC) conference held on the West Coast. This conference enabled a network of tourism operators to formulate a team marketing approach for teh region.

DevelopmentofaCulturalHub Council consulted with the Community on a proposal to establish a Cultural Hub consisting of an I-Site and Museum in 2005. The first stage of this project (I-Site and Museum relocation) was included in the 2006 Long Term Plan. There were plans to revitalise the town centre through the creation of a Cultural Hub, linking these two services and the new Performing Arts Centre. Council’s budget increased from $1.5m (as previously indicated) to $3m over three years in the 2009-2019 Long Term Plan. Tenders received during the year indicated that the project cost would rise to $3.75m. Council was successful in securing corporate sponsorship from Solid Energy totalling $750,000 towards the project. In November 2011 the Lottery Environment and Heritage Committee agreed to provide funding of $586,000 towards the Cultural Hub project.

In April 2012 the Grants Committee agreed to provide up to a maximum of $500,000 from the Development West CommunityServices Coast Extraordinary Distribution Fund towards the Cultural Hub project with Coaltown Trust fundraising for the re- mainder. The contribution towards the project, from the general ratepayers funds, remains capped at $1.5 million and will be loan funded. Council approved the successful tenderer, Coman Construction on 27 June 2012 and construction of the project com- menced in the new fi nancial year. Construction for the relocation of Coaltown and the I-Site is expected to take nine months, and it is expected to be fi nished by April 2013. 38

Recreation&CulturalFacilities&Services The NBS Theatre provides the Buller District with live theatre and shows, performing arts and fi lm. The venue is also able to hold conferences of varying sizes, workshops and festivals - both dramatic and fi lm.

Public Libraries and Community Libraries are provided within the District delivering access to many forms of information and resources to help support life long learning, literacy and recreational reading.

Significant importance is placed on the delivery of cultural, environmental and industrial heritage to the District. The Council is leading projects to develop cultural facilities for the district.

CommunityEngagement Council provides community newsletters, media releases, specialist working groups and consultation programmes to inform and involve residents in Council activities and decisions.

Whydowedoit? A community is enhanced through the provision of services that deliver to the cultural and recreational needs of residents.

These services are vital to the quality of life of residents and provide the infrastructure that enables the building of social, cultural and sporting associations within the community. The community also has a vital role to play in contributing to the district’s success by being informed about and involved in decisions and projects.

ContributestowhatCommunityOutcome? Community Outcomes How the Council Contributes Health By providing facilities that allow people to play sport and achieve their fitness and recrea- tional goals. Providing grants, facilities and spaces that assist in developing the community cohesion that supports mental and social well being. Education Assisting in the development of lifelong learning and literacy through the Library network. Providing performance space for use in artistic and cultural performance. Working with edu- cational institutions on collaborative projects. Safety Supporting the work of social organisations that deliver services to those in need.

Economy Providing high quality community facilities to attract people to live and work in the Buller district. Provide opportunities and funding that assist with tourism development and district promotion. Identity Using consultation opportunities to make decisions about the future of the Buller district that refl ect the unique attitudes and needs of Buller district residents.

Supporting the promotion of the Buller district through developing opportunities to tell the stories of the social, cultural and industrial heritage.

Buller District Council (conceptual drawing - Cultural Hub, Westport, currently under construction) 39

HowCouncilPerformed? Grants In 2011/2012 Council contributed over $67,000 in base and contestible community, representation and minor grants. The groups that received the funding provide accountability statements to Council.

NBSTheatre In 2012 the NBS Theatre has held numerous shows both with local performers and acts from outside the district (including two over- seas acts) over the last year.

Some of the highlights in the au- ditorium have been Showtime Aus- tralia with their ABBA show. Other show genres have included com- edy, dance, live theatre and musi- cal. The NBS Theatre has joined with Nelson School of Music, Nel- son Theatre Royal and Ashburton Event Centre as the Top of the South Consortium. This is one of three consortiums throughout NZ that apply for funds from Creative NZ to enable New Zealand per- (NBS Theatre, Westport) formers to visit local venues.

It is pleasing to see usage of the auditorium by a local church group every Sunday. Two professional health providers have also hired rooms within the Theatre on a regular weekly basis. The Theatre is also the preferred venue for the 3 yearly voting for the general parliamentary elections.

The Fred Gregory screen room is constantly being hired out for birthday parties, utilising the IT equipment for playing playsta- tion or watching a fi lm of their choice. This room has also been used for meetings and small conferences with presentations being electronically delivered to the audience.

The NBS Theatre is versatile in that all three areas (Auditorium, Bill Moffi tt Cinema and Fred Gregory screen room can be used simultaneously.

The cinema area of the building is open seven days with new releases of fi lms being screened in Westport as soon as they are available to the rest of New Zealand. Midnight screenings of blockbuster fi lms have proved to be popular. The theatre has also assisted local groups, clubs and schools offering fundraiser screenings of fi lms.

The Theatre website (www.nbstheatre.co.nz) has been developed and users on our database receive regular weekly updates on movies and shows. A ticketing/booking fee system has also been introduced for the convenience of patrons.

The Theatre fulfi ls an important role in facilitating fundraising for local community groups and schools. It is a valued com- munity asset that is widely utilised as has been indicated by the favourable growth in our Key Performance Indicators for 2011/2012. 40

LibrariesandAotearoaPeoplesNetwork Buller Libraries experienced a growth in customer demand for online and e-resources. At the same time customers made more use of reader advisory and reference services provided by library staff. Despite a national drop, local issue numbers were nearly unchanged (- 0.7%). With 85,250 visitors Buller libraries are highly frequented facilities. Over 2,600 new additions updated the collection which currently holds nearly 32,000 items for the community. To enable community access to e-books and audio-books in an affordable and effective manner the library joined up with several other libraries on the South Island to subscribe OverDrive, an electronic download platform. There was a large update and within the fi rst three quarters over 850 e-books had been downloaded. PressDisplay, a virtual newspaper service for full text reading of national and international newspapers was integrated into the library website. The library would like to acknowledge New Coasters Westport and Tindall Foundation for their fi nancial support for Overdrive. All online services are available to library members throughout the district with free access to use their virtual library at any time. As a consequence of community demand, Reefton library became equipped with wireless internet access. The library under- took several activities to support literacy and learning in the community: 44 class visits and group library tours took place to promote library services to children and adult students and to use library resources. Collaboration with local community training providers contributed to a successful Adult Learner’s Week where the library turned into a hub for educational talks and presentations. Seventeen library events, programmes and displays allowed for engagement with authors and books. Twice the library has been organiser for the West Coast events of New Zealand Book Month for Children’s and also for Adults. A special highlight was the launch of the Denniston Literature trail where the library was involved in setting up and promoting the new literature walkway and its guid- ing materials. Children activities included research workshops entitled “Informa- tion for the Young and Curious”, a writing workshop with awarded writer Fleur Beale, colouring competitions and story times. Over the long summer and winter holidays an overbooked reading pro- gramme was offered to encourage reading and maintain literacy levels during the school breaks. Displays and story time Te Reo celebrated Maori Language Week. To keep members and stakeholders informed, the library produced a bi-monthly newsletter, contributed to the council community newsletter and frequently promoted activities through news and radio.

Buller District Council 41

DistrictPromotionandTourism Over the past year the Promotions and Development Offi ce has continued momentum on its core projects. The Collective Tourism Promotion Project, which is a fi ve-year project has been consistently added to providing the framework, systems and components needed to promote the Buller Dis- trict as a recognised visitor destination (RVD). Achievements to date include: • a comprehensive strategy and marketing plan • district tourism brand, • a new tourism website with search engine optimisation and google ad campaigns, • a photo library • district-wide signage • development of a Buller Touring Guide and distribution throughout the South Island • creation of 11m long portable display system for tradeshows, expo’s, events and meetings • plus further developing networks with tourism operators and stakeholder groups within the region

The offi ce has also produced the fi rst Buller District promotional video which was showcased/launched at the Tourism Export Council conference. This has been released for all tourism operators and stakeholders to use on their own websites. The Promotions and Development Governance Group has been kept informed and engaged in all of the above developments. Communications Council continued to produce a bi-monthly newsletter that is delivered to all households in Buller. The Council website is regularly updated to provide the most up-to-date information to our customers.

During the 2011/2012 fi nancial year Community Services introduced an e-newsletter “Council Community Info” which is sent to community members every two weeks.

This allows for communication lines to be kept open for those who want to know about Council activities. Promotion of this e-newsletter was done through the bi-monthly newsletter, Council’s website and directly approaching large organisations to send promo information to their staff.

This form of communication is slowly increasing as time progresses and more people become aware of the service.

SolidEnergyCentre(managedbyBullerRecreationLtd(BRL)) Buller Recreation has now completed three years of business, and has seen some signifi cant growth during this period. The building has performed well during this time, with only minor issues needing to be dealt with in comparison to the fi rst two years, and this has meant that more time can be focused on improving the way the business is run.

Current membership is over 600, which is almost double what it was 12 months ago. This has meant the centre has been very busy towards the end of the fi nancial year, and the numbers attending exercise classes has grown considerably. It has been great to see more of the “less fi t” members of the community making use of the facility, and enjoying the benefi ts of increased fi tness and healthy lifestyles. BRL has recently entered into a contract with the West Coast Public Health Organisation to deliver Green Prescription services to the Buller community, and this has been a great way to connect with those who need a helping hand on their road to healthy living.

The removal of the turf has been a big loss for the centre, and the absence of the hockey community during the winter months has been very noticeable. We look for- ward to seeing this reinstated in time for the next season, and having a turf that we can rely on in all weather conditions. Schools have continued to make good use of the facility – primary schools have predominantly been using the pool while Buller High and Westmount have been using all areas of the centre.

The centre has undertaken an energy audit towards the end of the year, with the report due shortly. It is hoped that this will result in some additional ways to save money on the energy bill, which continues to be a signifi cant cost to the business.

BRL is now well placed to develop its services further in the coming year, and looks forward to working with our community to help them reach their fi tness and exercise goals. 42

KeyPerformanceIndicators What we did What we measured TARGET ACTUAL To contribute Community Grants and Funding: to commu- Distribution of 90 - 100% range 92% Achieved (2011: 100%) nity develop- national funding in ment through accordance with A further $67,000 distributed in base and liaison, policies contestible funding for Creative New funding and Zealand, SPARC and Ministry of Justice support to (2011: $40,000) vital commu- nity organisa- Council Grants dis- 90 - 100% range 100% (2011: 100%) tions tributed and moni- tored in accordance with our policies To support District Promotion, Tourism Support and Events: the develop- Key Performance 90 - 100% range KPI’s have been set per organisation by ment and Indicators (KPI’s) Council and agreed by the relative par- sustainability agreed with all KPI’s monitored and achieved ties for district identifi ed grant tourism recipients and Quarterly reports are provided to the monitored Community Services Offi cer. Monitor achieve- Monitor increase / decrease in guest Continual monitoring of data from Sta- ment of strategic nights for Buller tistics NZ in relation to regional visitor tourism objectives nights is being undertaken

Communication and data sharing with Tourism West Coast has occurred

Tourism West Coast also provides regular updates and newsletters to industry on changes in guest night data. These are forwarded to stakeholders where required Ongoing input and development of tour- Continual search engine optimisation and ism website google ad campaigns intiated for buller. co.nz website Monthly reports from Visitor Strategy Consistent reporting in place for all key Offi cer stakeholders Completion of Cul- Fundraising strategy developed, imple- Council approved calling for tenders tural Hub Project mented and initiation of Cultural Hub in March 2011. Council approved the construction project and successful tenderer on 27 June 2012

Delays were experienced in the approval of the project until all funds to proceed with the project were in place

As a result of the delay in the approval of the project, construction only com- menced in August 2012 Visitor satisfaction Establish Memorandum of Understanding The project was only approved in June and/or level of service agreements with 2012 and this has delayed the formal or I-Site and Museum once construction approval of any associated governance completed and businesses are opera- structures tional

Buller District Council 43

What we did What we measured TARGET ACTUAL To provide Community Services and Facilities: services and Quality of sport and Establishment of Memorandum of Service level agreement fi nalised be- facilities recreation service Understanding and agreed levels of tween Buller District Council and Buller that meet provision via the service for operation and management Recreation Limited. Statements of information, Solid Energy Centre of the Solid Energy Centre (including all Intent are submitted and approved by learning, aquatic and dry-sport provision) and the Council. Quarterly reports regarding us- recreational Reefton pool (providing seasonal aquatic age are submitted to Council and cultural services). needs Agreed levels of service are likely to in- Monitoring of these done in the half clude attendance, satisfaction, mainte- yearly reports submitted by Buller Hold- nance of ACC Pool Safe quality Manage- ings to Council ment accreditation for the Solid Energy Performance to the targets in the State- Centre (which includes independent ment of Intent reports as refl ected under quality assessment of pool management Council Controlled Organisations and operation to industry standards) and working towards ACC Pool Safe Qual- ity Management accreditation for the Reefton Pool as the Reefton pool will be managed by the Solid Energy Centre, the measures relative to the Reefton Pool will be included in the Memoran- dum of Understanding for the Solid Energy Centre.

Measures will be agreed and refi ned once the Memorandum of Understanding has been developed. Number of perform- Number of cinema screenings per week 35 on average per week (2011: 45 per ing arts events, - 21 week) exhibitions and (dependent on fi lm titles and time of shows per year the year) Occupancy of cinema - 50% per month 22.8% occupancy per month in the Bill Moffi tt Cinema and 24.1% occupancy in the Fred Gregory screen room - totalling 23.6% total occupancy The introduction of Met Opera screen- ings averaged 41.7% occupancy Number of shows/performances - 30 42 days per year (2011: 37 per year) days per year Occupancy per show - 60% Overall occupancy 63.6% (77.03% local (full Theatre not always required for show occupancy and 49.6% outside show smaller shows) occupancy) (2011: 25.4% overall occu- pancy - local occupancy 90%) The wide variety of shows offered has vastly increased occupancy from last year Room hire - 4.0 hours per week The average room hire per week for three rooms is approximately 31 hours Positive growth due to regular hiring out of two rooms by health professionals 44

KeyPerformanceIndicators What we did What we measured TARGET ACTUAL To provide Community Services and Facilities: (continued....) services and facilities Satisfaction with 80 - 95% range 90% according to an internal customer that meet Library services survey (2011: 88.7%) information, Number of active Maintain or increase (0-4%) Active Members 3,247 - increased by learning, members of librar- 3.2% (2011: 3,145 - 8% increase) recreational ies and cultural Number of items Issues maintained or increased 77,248 items borrowed decreased by needs borrowed 0.7% (Target 72,000) (2011: 77,769) Number of physical Increase annually until we are meeting 2,663 items added (2011: 2,796). LIANZA items added to the the LIANZA standard standards would require a minimum Library collection holding of 35,957 items (86% of LIANZA per year Standard) Not less than 2,000 new items per year Current items held total 31,097 (2011: 86%)

Buller District Council 45

2011/2012 2011/2012 2010/2011 CommunityServices Actual Budget Actual $(000) $(000) $(000)

OPERATING Revenue Targeted Rates 268 320 227 Fees and Sundry 580 451 524 Financial Assistance 1,528 576 712 Internal Recoveries 3 22 5 TOTAL Revenue $2,379 $1,369 $1,468

OPERATING Expenditure Employee Benefi t Expenses 707 663 640 Depreciation and Amortisation 213 232 189 Finance Costs 1,103 1,278 1,147 Other Expenses 3,413 2,280 2,561 $5,436 $4,453 $4,537 Less: Internal Interest (26) (24) TOTAL Expenditure $5,410 $4,453 4,513

NET Cost/(Surplus) of Services $3,031 $3,084 $3,045

Capital Expenditure - Renewals 896 114 602 Capital Expenditure - Increases in Levels of Service 0 1,152 0 TOTAL CAPITAL EXPENDITURE $896 $1,266 $602

ExplanationofSignificantOperatingVariances

FeesandSundry: Unbudgeted power contribution from Buller Recreation Limited ($157,000). This does not represent additional income but merely offsets the heating and power costs incurred by Council in respect of the Solid Energy Centre.

FinancialAssistance This is due to the recognition of sponsorship revenue ($830,000) for the Cultural Hub when the project was approved by Council in June 2012. This income was previously classifi ed as income received in advance. Delays in approval of the project hindered fundraising and the budget of $500,000 was not achieved. Overall a favourable variance to budget of $330,000 was recorded.

In addition, Council received unbudgeted sponsorship income of $114,000 towards the NBS Theatre and $540,000 for the Solid Energy Centre.

FinanceCosts Finance costs were lower than anticipated due to lower prevailing interest rates and the postponement of the Cultural Hub project. The postponement of the project resulted in savings of $32,000. 46

OtherExpenses Other expenditure was signifi cantly higher than budget ($1.1 million) largely due to the following: • Recognition of the obligation to Buller Recreation to remediate the hockey turf ($744,000) • Unbudgeted legal and consultant expenses associated with preparation for the hockey turf dispute with contractors ($64,000) • Unbudgeted grants for Vision 2010 projects not owned by council (Reefton V2010 projects - $ 63,000; Seddon - $5,000) • Council incurred costs of $190,000 for power and gas for the Solid Energy Centre, however $157,000 of these costs were recovered from Buller Recreation Limited. Power and gas exceeded budget by $33,000. • Performance fees for the NBS Theatre exceeded budget by $34,000.

SignificantCapitalExpenditure To-date $1.3 million has been carried forward to 2011/2012 as work in progress for the relocation of the Coaltown Museum and construction of the Cultural Hub. Work in progress carried forward from 2010/2011 totalled $873,000. Costs to-date include purchase of land, buildings and professional services.

$191,000 has been carried forward in respect of the carpark at the NBS Theatre.

Unbudgeted capital expenditure on Domain Boards totalled $134,000.

Other capital expenditure included the following: • Work in progress totalling $14,000 was carried forward for Buller Regional display panels • Promotion and Development initiatives ($12,000) which mainly include photography, development of the website and signage • Acquisition of library books ($41,000, Westport; $16,000, Reefton)

ExplanationofSignificantCapitalExpenditureVariances Approval to proceed with the Cultural Hub project was only given by Council in June 2012. This delayed the construction of the project and all expenditure incurred to-date has been carried forward as work in progress.

$191,000 was carried forward as work in progress for the completion of the NBS carpark. This was budgeted for in the 2010/2011 fi nancial year.

Buller District Council 4747

Environmental Services

Whatdowedo? These activities protect people and the environment by regulating and licensing aspects of commer- cial services and private behaviour where public well-being issues may arise, an in preparing for and responding to emergency situations in the District.

AnimalandStockControl Animal control manages dogs and wandering livestock, including the control of animals (excluding dogs) on public land and public roads. Council also operates the pound where stray dogs are taken. These dogs are returned to owners or rehomed where possible.

Plans,PoliciesandGuidanceDocuments The Council provides a range of tools to guide the public in complying with rules, regulations and best practices. These range from regulatory tools such as the District Plan and Bylaws through to guidance tools such as policies and brochures.

ComplianceManagement Council manages the licensing and inspection of food and liquor premises, inspects activities carried out under consents and manages the impact of nuisances through investigation, remediation and the use of regulatory tools where necessary.

ProvisionofConsents Council provides consents for activities to be carried out in accordance with regulatory requirements. These include building consents and resource consents for land use and subdivision consents. Council also issues Land and Project Information Memoranda (LIM’s and PIM’s) and ensures that appropriate certifi cation is achieved for buildings in use by way of Code Compliance Certifi cates and Building Warrants of Fitness.

LiquorLicensing For the purposes of the Sale of Liquor Act 1989 each local authority is the District Licensing Agency for its district and except as otherwise provided in this Act, the Agency is governed by the provisions of the Local Government Act. The Alcohol reform Bill which the Justice and Electoral Committee has recommended be passed with some amend- ments, will result in the requirements for Council to form a Local Alcohol Policy and there will also be an increase in responsibility and consequences for holders of liquor licences.

Building Building Services provide a compliance service to ensure the built environment throughout the District meets the minimum requirement of the Building Act 2004. Guidance is provided to customers as they navigate their way through the building consent process. Asessment of building consent applications are required to meet the require- ments of the Building Act 2004. EnvironmentalServices 48

Whydowedoit? The Council plays a vital role in ensuring standards are met that result in a high quality of life for residents and visitors in our district. This is achieved by administration of statutory regulations for building, resource management, licensing of premises and the keeping of dogs and livestock. The outcome of effective delivery of Environmental Services is a district where resource utilisation and standards of living are appropriate for the community long term needs.

HowdowecontributetoStrategicGoals&CommunityOutcomes? Community Outcomes How the Council Contributes Health Through the administration of legislative frameworks we ensure that appropriate standards of food safety and responsible provision of liquor occurs within licensed premises

Addressing adverse effects of animals and social behaviour when they occur Safety Building services ensure the ongoing safety of structures within the District

Investigation and management of non-compliance with regulations and district rules where these have the potential to create hazard or danger to the public Environment Applying the provisions of the District Plan and the Resource Management Act to minimise adverse effects of land use and subdivision of land

Working with other agencies to ensure regional plans and national policies are upheld in resource use for the sustainable management of our environment Economy Consideration of economic and productive use of resources in planning decisions for the long term protection of the value to our community

Working with licensed operators to maintain high standards of service delivery and host responsibility Identity Ensuring the District Plan and Policies of Council are developed to protect those unique aspects of Buller lifestyles

HowtheCouncilPerformed AnimalControl Council has continued to provide animal control and lost and found animal services. Council has also provided assis- tance to owners in dealing with problem animinals and has provided education programmes.

(Animal Control Offi cers - Issac Taylor and Tracy Judd) LiquorLicensing 171 liquor licences and manager certifi cate applications have been processed.

The Buller District Licensing Agency Liquor Policy is to be reviewed and publically adopted after the second reading of the proposed Liquor Reform Bill.

The Liquor Licensing Inspector together with the Police and Community & Public Health have undertaken monitoring and inspections of licensed premises throughout the district including Controlled Purchase Operations. Council has undertaken enforcement action with the Liquor Licensing Authority to deal with serious non-compliance. Council has also provided staff training, advice to licensees and managers and the general public.

Buller District Council 49

FreedomCampingBylaw Council replaced its Freedom Camping Bylaw 2011, which had been adopted under the Local Government Act 2002, with the Free- dom Camping Control Bylaw 2012 which was adopted under the Freedom Camping Act 2011. The new Bylaw came into force on 30 August 2012 and extensive consultation took place during the fi nancial year.

Under the Bylaw, Freedom Camping is allowed in any local authority area outside of the defi ned “no freedom camping zones”, for up to three consecutive nights at the one site or in the same area in self-contained vehicles certifi ed against NZS5465: 2001. Freedom Camping that does not meet these criteria may be allowed with the prior consent of Council, which may be with or without conditions.

Building The Buller District Council is currently accredited to operate as a Building Consent Authority. Two-yearly statutory audits are carried out by International Accreditation New Zealand (IANZ) and the latest audit was completed and passed in December 2011.

An internal audit of all building processes has been carried out over the past 12 months. These audit fi ndings resulted in continu- ous improvements via minor amendments to the technical and management manuals which are used by staff to carry out building control functions. Previous assessments by IANZ have shown that Council is a leading Building Consent Authority (BCA) with regard to policies and procedures and the way it operates.

DistrictPlanReview The District Plan Review is an ongoing project looking at the effi ciency and effectiveness of the Buller District Plan (BDP).

It aims to ensure that the BDP remains relevant and meets the needs of our community in relation to the use of natural and physical resources, as well as meeting our responsibilities under the Resource Management Act 1991 (RMA). Under the RMA, Council must review every provision of the BDP at least once every 10 years and initiate a ‘plan change process’ in relation to each, whether or not Council proposes to amend the provision. This process provides an opportunity for the community to have input into the BDP.

Council gave its fi nal approval to the fi rst two sets of BDP changes to come out of the review, Plan Changes 115-121 and 122-132, on 21 September 2011. These changes then became a fully operative part of the Buller District Plan.

The Buller District has changed signifi cantly since the BDP became operative in 2000. We are using the opportunity of the District Plan Review to update the BDP to take into account where the district is now and how the community would like to see it develop over the next 10 years.

ResourceManagement The Planning Department has had a busy year with increased workload and some complex resource consents in the mining sector. High profi le consents have included Solid Energy’s application for a coal mine at Mount William, Stockton, and changes to the Globe Hill/Oceana Gold consent in Reefton.

The Planning Department has also been heavily involved in progressing the resolution of appeals made in relation to Buller Coal Holdings coal mine application and the Meridian/Mokihinui hydro power scheme through the Environment Court appeal process.

WestportConceptPlan The Westport Concept Plan is an initiative that is designed to create a picture of what we want Westport to look like in the future and what we will have to do to get there.

We would like to prevent ad-hoc development and we believe that a cohesive plan will assist in the future development and growth of our community. The Plan will include preferred zoning of land, landscaping, traffi c movement and generally display Westport as a great place to live and invest in. It will be developed in consultation with the community and stakeholders with opportunities for input through its development.

The work already undertaken by Council as part of Vision 2050 strategic planning and the adoption of the Long Term Plan 2012 to 2022, will set the direction for the Westport Concept Plan which will in turn provide direction for the review of the Buller District Plan and Council’s other regulatory policies and guidance documents.

Once developed the Westport Concept Plan will be used as a template to develop Concept Plans for Buller’s other towns. 50

KeyPerformanceIndicators

WHAT WE DID WHAT WE MEASURED TARGET ACTUAL To maintain Carry out investigations into Simple investigations to be Achieved 112 simple investiga- quality of life non-compliance and nuisance carried out within 10 work- tions within 10 days 82% (2011: 161 through ensuring / activities in acceptable ing days investigations with 100% within time- compliance with timeframes frame building and development More complex investigations 5 remain under investigation, await- regulations to be undertaken within 20 ing court action (2011: 5 - 3.65%) working days 20 complex investigations undertaken within 20 days 14.6% (2011: nil) Building inspections carried Achievement of this level Achieved 100% (2011: 100%) out within 24 hours for urban of services in the 90-100% 1,473 inspections have been recorded and 48 hours for rural areas range (2011: 1,327) Building inspections are scheduled and carried out in accordance with bookings made Achieved 100% Building consents and LIM’s Target 100% 491 Building Consents issued 99% issued within statutory time- (2011: 465 99%) completed within the frames 10 working days for statutory 20 working day timeframe LIM’s and 20 working days for 312 LIM’s issued 100% completed Building Consents within the 10 working day timeframe, with an average of 4 days process- ing time (2011: 217 issued with 98% completed within timeframe) Audit compliance schedules No sampling undertaken No sampling undertaken

Not currently a requirement under the Building Act Meet earthquake policy objec- This policy was revised and Due to the publicity following the tives a new policy approved by Christchurch earthquakes, any build- Council 16 December 2009 ing consent application received for commercial buildings which would be Buildings will be identifi ed affected by this policy have included when a consent applica- voluntary strengthening work by the applicant without any requirement tion is received, change for Council enforcement of use occurs or complaint received In addition, Council has carried out an initial visual inspection of at risk commercial buildings in both West- port and Reefton The fi ndings passed onto the building owners which have prompted further in depth investigations funded by the owner It has resulted in some buildings undergoing strengthening work and in some cases evacuation of the build- ings Process non-notifi ed resource Target 100% 96.8% achieved within statutory consents within 20 days timeframes (2011: 100%) Ensure quality assurance Completed by 31 December Audit completed in December 2011 requirements for building 2009 and accreditation maintained consent authorities are met as required by Regulation 17 of Continued compliance with Building Consent Authorities accreditation requirements Regulation 2006

Buller District Council 51

WHAT WE DID WHAT WE MEASURED TARGET ACTUAL To maintain Inspect all food premises Target 100% 100%, 94 premises inspected (2011: quality of life 100%, 90 premises) through ensur- ing the health No signifi cant fi ndings and safety of li- These premises met the standards set cenced activities by the Food Hygiene Regulations 1974 To maintain Investigate all animal related Target 100% 100%, 468 complaints investigated quality of life complaints (2011: 100%, 499 complaints investi- through ensur- gated) ing the effects of dogs and live- This is measured by the use of the stock are mini- service request system and all com- mised plaints are loaded through this system Continued education for animal own- ers occurs To address non- Respond to 90% of all noise Target 90% Achieved 95% - 202 complaints re- compliance or complaints within 30 minutes ceived with 192 being responded to nuisance activi- within 30 minutes (2011: 95%, 340 ties in ways that complaints received, 323 responded uphold the com- within 30 minutes) munity outcomes Maintain quality Plan changes processes initi- District Plan to be completed A set of District Plan changes is cur- of life in Buller ated as part of the District Plan by June 2015 rently being worked on and ensure that Review. future plan- District Plan changes to be aligned ning rules re- District Plan review to be com- pleted by 30 June 2015 with Vision 2050 and Westport Con- fl ect community cept Plan needs and legis- lative require- Each process can involve con- It is intended they will be initiated in ments sideration of a number of provi- October/ November 2012 (2011: Plan sions of the Buller District Plan changes 122-132 initiated in the 2011 calendar year) Buller District Council 5353 Emergency Management Whatdowedo?

CivilDefencePreparedness: The goals of local emergency management in Buller are summed up as the four R’s: Reduction, Readiness, Response and Recovery: Reduction - we analyse potential hazards in our region and take steps to reduce the risk of injury and death, damage and social and economic disruption. Readiness - staff in local emergency services are trained to deal with dangers, and the general public made aware of ways to stay safe during emergencies and how to cope on their own. Response - actions taken before, during and after a disaster to save lives and property include declaring a civil defence emergency, evacuating areas, closing roads and requisitioning anything useful. Recovery - activities taken to restore the community to normal functioning. We encourage local businesses to plan recovery actions. Council recruits and trains volunteers to ensure that in the event of a disaster a workforce can be maintained to deliver services to residents in need. The Council works with Regional and Government representatives to develop plans and processes.

RuralFireControl: Council participates in the West Coast Rural Fire Committee to manage the fi re district. This involves issuing of fi re permits, training and maintenance of volunteer fi re forces and the maintenance of a comprehensive fi re plan. Buller Rural Fire Authority has 40 volunteer’s and 3 rural fi re units (Charleston, Inangahua and Seddonville) sup- ported by three staff members providing emergency response and community safety programmes throughout the rural district. Rural Fire Services also assist in motor vehicle accidents and education programmes.

Community Outcomes How the Council Contributes Health Emergency management is a key function in ensuring that injury to people is minimised in the event of natural disasters.

Safety The safety of people and their property is the paramount concern of emergency management plans and processes. EmergencyManagement 54

HowtheCouncilPerformed

CivilDefence: Civil Defence Emergency Management is delivered through a series of partnerships between many different groups: emergency services, community agencies and the wider community. Buller communities rely upon these partnerships for effective emer- gency response and relief and volunteers are a vital component of this partnership.

Without the commitment of devoted and skilled volunteers, services to the wider com- munity in the event of an emergency would be severely restricted. Volunteers fulfi l a range of roles in an emergency, including rescue and welfare services and come from all walks of life.

RuralFire: Council retains its strong position with the West Coast Rural Fire Committee. The rural fi re stations are staffed by dedicated people who commit their time and considerable effort into ensuring that their neighbourhoods have the best protection from fi re as possible.

Charleston Volunteer Rural Fire Force at a special awards presentation held recently at Charleston, left to right Mike Copland, Brent May, Tina Greiter, Nathan Keoghan (Zone Controller) Marilyn Berendt, Marg Nolan, Phil Cate and Chris Milligan who has just joined the brigade after his retirement from the US Air force Airborne Communication Air-craft Fire Rescue and Safety Instructor

Buller District Council 55

KeyPerformanceIndicators

WHAT WE DID WHAT WE MEASURED TARGET ACTUAL To establish an ef- Maintain three teams of 30 trained volunteers Achieved Karamea, Westport and Reefton fective level of pre- trained volunteers (3 teams) teams in place. 160 volunteers and staff paredness for Civil trained in various roles (2011: 160 volun- Defence disasters teers) Run exercises to test ef- On-going regional Council participated in Operation Cruick- fectiveness exercises scheduled shank Minor as a desktop exercise, co-ordi- and completed nated from the Grey District Council. Develop Civil Defence, In- On-going review of Emergency Operation Centre fully functional formation Communication the Emergency Op- Technology and Recovery erations Centre The Community Response Plan has been Plans updated and Buller Civil Defence plans have been reviewed and aligned with the group plan. Review all plans This is still very much a work in progress against best practice Council is looking at aligning our local ar- rangements with Westland and Grey District Councils and the Civil Defence Emergency Managment Group Plan) To respond to and Annually review fi re plan On-going review of Continual review of fi re plan control wildfi res to fi re plan protect property and conservation values. Maintain trained volun- Regular personnel All rural fi re stations conducted weekly teers, fi re engines and and equipment audits training sessions equipment carried out by Zone Controllers Crews have also attended specialist training courses when required Maintain restricted fi re Provision of on-going On-going training to all rural fi refi ghters and season and fi re education training to all Rural ensuring equipment met compliance require- Firefi ghters ments 56

2011/2012 2011/2012 2010/2011 EnvironmentalServices Actual Budget Actual $(000) $(000) $(000)

OPERATING REVENUE Fees and Sundry 1,342 788 1,009 Financial Assistance (12) 0 81 Internal Recoveries 6 23 8 TOTAL Revenue $1,336 $811 $1,098

OPERATING EXPENDITURE Employee Benefi t Expenses 973 921 930 Depreciation and Amortisation 54 22 36 Finance Costs 13 11 12 Other Expenses 1,255 1,117 1,076 2,295 2,071 2,054 Less: Internal Interest (13) - (12) TOTAL Expenditure $2,282 $2,071 $2,042

NET Cost/(Surplus) of Services $946 $1,260 $944

Capital Expenditure - Renewals 2 0 0 Capital Expenditure - Increases in Levels of Service 0 0 157 TOTAL CAPITAL EXPENDITURE $2 $0 $157

ExplanationofSignificantOperatingVariances FeesandSundry A budget error associated with the dog registration income resulted in budgeted fees and sundry being understated for 2011/2012 by $319,000. A signifi cant increase in the number of Resource consents processed resulted in Resource Consent fees being $86,000 higher than budget. Council also received an unbudgeted contribution towards legal fees ($62,000). Unbudgeted Reserve Contributions on subdivisions of $91,000 were also received by Council.

EmployeeBenefitExpenses The overrun in employee benefi t expenses is due to an unbudgeted correction of prior year health care expenses and provisions for retiring gratuities, employee entitlements and long service leave. OtherExpenses The increase in resource consents processed, in combination with the workload associated with high profi le consents resulted in a greater usage of external consultants. This led to higher than anticipated expenditure on consultants ($133,000). All expenditure was fully recovered. SignificantCapitalExpenditure No signifi cant capital expenditure. ExplanationofSignificantCapitalExpenditureVariances No signifi cant capital expenditure variances Buller District Council 5757 Amenities& Reserves Whatdowedo? Council provides and maintains active and passive recreational facilities in the Buller District to meet community and environmental needs.

These include parks, reserves and sports facilities. Public toilet facilties are provided by Council at Westport, Reefton and Waimangaroa. Council also assists in the provision of toilet facilties at Karamea, Granity, Carters Beach, Inangahua Junction and Ikamatua. Council operates the Orowaiti, Mokihinui, Reefton and Boatmans cemeteries. Council also owns the Punakaiki Beach Camp.

Whydowedoit The provision and maintenance of parks and reserves create a pleasant environment in which to live, work and play, which is an important part of the Vision for the district. The provision of public toilet facilities assists with promot- ing the health and well being of the district and environment. Jointly funding facilities with other agencies allows the public access to facilities at an acceptable cost.

HowwecontributetoStrategicGoals&CommunityOutcomes This activity supports the following community outcomes: Community Outcomes How the Council Contributes Safety By ensuring our parks and reserves are healthy and safe. Health By providing areas for people to engage in healthy activities.

Environment By offering opportunities for people to contribute to projects that improve our dis- trict’s environment. Education By providing the opportunity to learn through social interaction and recreation.

Economy By contributing to the district’s image and attracting businesses, skills and tourism. Identity By organising community events and providing people with opportunity to interact with different communities and by creating a unique image of the district. Amenities&Reserves 58

HowCouncilPerformed

Council’s active and passive recreation areas were available to be used by ratepayers and sporting clubs throughout the year. There were no days in which the facilities were closed for any purpose.

In 2011/2012 the Buller District Council invested $157,000 funds towards upgrading playgrounds around Buller. Upgrading of the Derby Street, Seddonville, Hector, and Mokhinui Playgrounds were commenced and are ongoing and will be com- pleted in 2012/13. These structural upgrades have been funded from the Reserves Contributions. $13,000 has been carried forward as work in progress.

District-wide garden upgrades totalling $26,000 were undertaken with new water systems installed in Palmerston and Menzies Streets in Westport and in Reefton.

District beautifi cation projects included the pruning of 80 trees in Victoria Square and 18 replacements were undertaken.

Planting of magnolia trees and garden upgrades at Westport Cemetery were completed . The Westport and Reefton Sextons sheds were painted. Finalisation of the land purchase to extend the capacity of the Orowaiti cemetery was completed .

Exterior painting of the Broadway Reefton pensioner fl ats ($20,000) and interior upgrades of four units in Westport and Reefton

Air conditioning was installed and exterior painting of the Reefton service centre was undertaken ($32,000) and the Brougham Street garage was reroofed ($27,000).

Vandalism protection and an upgrade was undertaken on the Victoria Square public toilets ($147,000). Work in progress from 2010/2011 totalling $85,000 was carried forward from 2010/2011 fi nancial year.

Consultation on the proposal to lease the Punakaiki Camp began in October 2011. This resulted in the formation of a work- ing group to consider all options available to the community. No fi nal decision has yet been recommended as at 30 June 2012.

Critical maintenance was carried out at the Reefton Service Centre, WestReef Depot, at Victoria Square and at the Brougham Street building.

Buller District Council 59

KeyPerformanceIndicators WHAT WE DID WHAT WE MEASURED TARGET ACTUAL To provide parks Customer satisfaction with 80% No complaints were received concerning and reserves that appearance of parks and with the maintenance or operation of any of meets community range of recreation opportuni- the facilities and environmental ties available in parks needs % checks on contractors stand- 95% Checks were undertaken on the mainte- ard of maintenance on active nance contractor any defects were noti- recreation area fi ed to the contractor who then remedi- ated (2011: 100%) % of households that have used 80% No survey undertaken or visited parks, reserves or gar- dens in the last 12 months Weekly safety and maintenance 100% 100% (2011: 100%) inspections of playground equip- ment The contractor completed weekly safety checks on all play ground equipment Survey to determine if sports 90% Sports fi eld usage has met users require- fi elds meet the agreed standard ments as notifi ed to Council by sporting codes PGG Wrightsons are engaged to provide advice on the annual turf management programme No survey carried out % of occupancy of Elderly Per- 90% 98.7% sons Housing From income records fl ats were vacant for 29 weeks (2011: 24 weeks) There is potential for the fl ats to be occupied for 2,288 weeks per annum therefore the occupancy rate was 98.8% (2011: 98.8%) % customer satisfaction on provi- 80% A questionaire was sent to the occupiers sion of elderly housing of all 44 units - 31 (70%) were returned Of those returned 93% were satisfi ed with their units (2010/11: 34 returned, 91% satisfi ed) Providing and managing cem- Continue to do the Cemeteries have been maintained and eteries to provide for community same are available for purpose health To have suffi cient plots available Verify cemetery re- Surveys show that cemeteries in Kara- in all wards to meet current and cords to verify that mea, Mokihinui, Westport and Reefton future demands availability is keep- have capacity for the next fi ve years ing up with demand 60

2011/2012 2011/2012 2010/2011 Amenities&Reserves Actual Budget Actual $(000) $(000) $(000)

Operating Revenue Fees and Sundry 1,158 791 1,243 Financial Assistance 0 0 0 Internal Recoveries 313 313 290 TOTAL Revenue $1,471 $1,104 $1,533

Operating Expenditure Employee Benefi t Expenses 6 0 6 Depreciation and Amortisation 441 310 388 Finance Costs 52 47 56 Other Expenses 2,209 1,741 2,042 2,788 2,098 2,492 Less: Internal Interest (45) 0 (50) TOTAL Expenditure $2,743 $2,098 $2,442

NET Cost/(Surplus) of Services $1,272 $994 $909

Capital Expenditure - Renewals 407 500 667 Capital Expenditure - Increases in Levels of Service 130 216 376 TOTAL Capital Expenditure $537 $716 $1,043

ExplanationofSignificantOperatingVariances FeesandSundry This is due to unbudgeted Domain Board income of $353,000.

DepreciationandAmortisation Depreciation was $135,000 higher than budget due to the following: • Domain Board depreciation ($29,000) was not budgeted • It was decided in the Annual Plan process that depreciation on the playground equipment would not be funded as future upgrades would be funded from Reserve Contributions, so depreciation was not budgeted ($33,000). For ac- counting purposes depreciation is provided for. • Budget error of $29,000 resulted in the depreciation budget being understated.

OtherExpenditure Repairs and Maintenance – Parks and Reserves

• During the Annual Plan process Council had reduced the maintenance budget from 2010/2011 by $77,500. However the budget effi ciencies anticipated in Parks and Reserves did not materialise and this resulted in expenditure on Repairs and Maintenance exceeding budget by $120,000. • Domain Board expenses of $295,000 were unbudgeted. • Historically Council has capitalised painting of Council buildings and the cost has been depreciated over the extimated life. A change in accounting treatment has resulted in Council expensing an unbudgeted amount of $130,000.

Buller District Council 61

SignificantCapitalExpenditure • The purchase from Utopia Farms to extend the capacity of the Orowaiti Cemetary was fi nalised in the 2011/2012 fi - nancial year ($301,000). Land purchase for the extension of Karamea cemetery has not been resolved. $245,000 was carried forward from the 2010/2011 budget as work in progress. • In 2011/2012 the Buller District Council invested $157,000 funds towards upgrading playgrounds around Buller. Upgrad- ing of the Derby Street, Seddonville, Hector, and Mokihinui Playgrounds were undertaken. Work in progress of $13,000 was carried forward to 2012/2013. • District beautifi cation projects and garden upgrades totalling $70,000 were undertaken. • Vandalism protection and an upgrade of the Victoria Square public toilets was undertaken ($147,000). Work in progress from 2010/2011 totalling $85,000 was carried forward from 2010/2011 fi nancial year for vandalism protection.

ExplanationofSignificantCapitalExpenditureVariances Work in progress from 2010/2011 totalling $85,000 was carried forward from 2010/2011 fi nancial year for the upgrade of the Victoria Square public toilets.

The change in accounting treatment of painting has resulted in $130,000 being expensed and not refl ected as capital ex- penditure. Buller District Council 6363

Roading&Urban Development Whatwedo? Council provides the management of the District’s roading network so that people can have safe, easy and comfortable access to homes and businesses. This activity includes the professional and technical work involved in providing for the ongoing management of the District’s network. It provides for the op- erating, maintenance and improvement programmes. This includes the day to day operation and main- tenance of footpaths and road pavement construction/ upgrades, traffic signs, street lighting, bridge maintenance, urban design and various road safety activities. Council provides for the ongoing opera- tion of the Westport Taxi Services.

Whywedoit? Public ownership of the road corridor ensures property access and freedom of travel through the area for all citi- zens and supports the sustainability of the community. Roads, footpaths and streetlights are provided for the safe travel of motor vehicles, bicycles and pedestrians. Management of the roading network provides vital economic links for the District. Council supports the continued operation of the Westport Taxi Service to ensure provision of transport for the dis- advantaged and to provide an alternative to drink driving as a road safety measure. Urban Design is undertaken to provide a more pleasant environment for our communities by use of plantings, street treatment and decorative measures.

HowwecontributetoStrategicGoalsandCommunityOutcomes This activity supports the following community outcomes. Community Outcomes How the Council Contributes Safety: By providing a safe roading system.

Economy: By providing everyone easy access to roading network and to minimise the viability of remote communities could be compromised.

Environment By helping reduce energy consumption in our community.

Education By providing education programmes.

HowCouncilPerformed Council’s programme of maintenance and capital works were undertaken and completed to budget. There were some variances in the categories that together make up the maintenance and capital programmes. The work under- taken is needs-based, and this will vary depending on road use and weather conditions. Council continued to use in-house professional services for contract administration and the design and supervision of the majority of road construction and maintenance contracts. Consultant engineers were engaged for those projects where specialist knowledge or a degree of impartiality was required. Regular inspections of the roading network were undertaken by both Council staff and the maintenance contractor, and from these inspections road maintenance programmes were developed to keep the network maintained and safe. Roading&UrbanDevelopment Council set a long term project for the upgrading of Derby Street from one end to the other, including replacing the underground services and reconstruction of the road. It is planned to upgrade the street two blocks per annum to spread the costs over a period of time for the ratepayer. The renewals undertaken this fi nancial year included water main renewals, new water connections and an upgrade of stormwater disposal - covering the blocks between Bright and Pakington Streets. Upgrading of footpaths continue (2km of footpaths were refurbished). 64

KeyPerformanceIndicators WHAT WE DID WHAT WE MEASURED TARGET ACTUAL Provide a safe Public Safety road network Annual Road Safety Audit Continue to audit Road Infrastructure and Safety Assessment under- 10% of the network taken by NZTA over 36.4 km of rural roads and an audit of the Karamea Highway and Karamea local roads was undertaken by Council Staff and road maintenance contractor An audit carried out by NZTA and Council staff cov- ered 93.15km which is 15.5% of the network (2011: 57.25km, 10%) The audit recommended replacing worn and clean- ing dirty signs, review consistency of some rural delineation, removal of vegetation where it is re- ducing the effectiveness of edge marker pegs Reducing trend in the num- Reducing trend of Based on the crash analysis report produced by the ber of fatal and injury acci- fatal accidents and New Zealand Transport Agency there has been a dents and accident contrib- those causing in- decrease in the number of accidents for 2012 for uting behaviour as measured jury the Buller District compared to 2010/11 but is still by statistics published by higher than the accident levels in 2008/09 NZTA Analysis of acci- dent causes to de- Serious accidents show a downward trend com- termine if remedial pared with the previous years work is required Fatal accidents have remained fairly static at 1 fa- tality in 2012 (2011: 2 fatalities) Accident reports provided to Council are analysed to determine if any road factors contributed to the accidents If there are road conditions or geometry that could have contributed to the accident then these are investigated for remedial work Provide a System Usability comfortable road network Maintain current road rough- Average sealed Road roughness surveys were undertaken in July ness levels road NASSRA rough- 2011 and June 2012 (not undertaken in in 2010/2011 ness less than 120, because of gear malfunction) unsealed roughness less than 200 Sealed road roughness 89.8 which meets the target of less than 120 (2011: 88.3) The roughness of a good sealed road is 70 NASSRA and for an unsealed road 170 NASSRA Unsealed roughness not measured, as this meas- urement is considered by the industry to not be of value as the roughness of an unsealed road changes constantly

Buller District Council 65

WHAT WE DID WHAT WE MEASURED TARGET ACTUAL Provide useable Footpaths footpaths Undertake condition rating Underake rating Footpaths were rated according to condition on a of footpaths of footpaths every scale of 1 to 5 two years From these ratings the forward programme of re- medial work for footpaths is determined Rating was undertaken in April 2011 and due to be undertaken in 2013 Maintenance programmes for footpaths are based on rating 2km of footpaths were refurbished by reseal or as- phalt concrete (2011: 1.7 km; 2%) This represents 2.3% of the footpath length Design all new footpaths for New footpaths de- 75 metres of new footpath constructed in concrete accessibility signed for wheel- - suitable for wheelchair and pram usage chair and pram us- age Minimise the System Disruption effects of road works To attend to all slips and 80% compliance The contractor responded to notifi cation of all slips obstructions in a timely with the contracted from call centre logs within the response times re- manner and undertake road response times quired works in accordance with national safety standards Road works checked Compliance checks were undertaken randomly at against national construction sites to check compliance with the NZ standards during Code of Practice for Temporary Traffi c Management site inspections – Local Road Supplement Provide roads Environmental Impact with the minimum To comply with resource 100% compliance No resource consents required for road mainte- environmental consent conditions nance or construction during the fi nancial year impact Encourage Encourage higher usage of Undertake survey The baseline survey was to be undertaken in con- higher usage walking and cycling to determine base- junction with the New Zealand Transport Agency of walking and line and other West Coast Local Authorities. cycling The change to the Government Policy Statement and availability of external funding resulted in the survey not being done 66

2011/2012 2011/2012 2010/2011 Roading & Urban Development Actual Budget Actual $(000) $(000) $(000)

OPERATING REVENUE Targeted Rates 47 46 39 Financial Assistance 2,736 3,045 2,914 Petrol Tax 177 170 173 Fees & Sundry 28 0 28 TOTAL Revenue $2,988 $3,261 $3,154

OPERATING EXPENDITURE Employee Benefi t Expenses 40 36 38 Depreciation and Amortisation 2,606 2,621 2,605 Finance Costs 0 0 0 Other Expenses 3,391 3,397 3,239 6,037 6,054 5,882 Less: Internal Interest 0 0 - TOTAL Expenditure $6,037 $6,054 $5,882

NET Cost/(Surplus) of Services $3,052 $2,793 $2,728

Capital Expenditure - Renewals 1,689 1,832 1,741 Capital Expenditure - Increases in Levels of Service 146 167 0 TOTAL CAPITAL EXPENDITURE $1,835 $1,999 $1,741

ExplanationofSignificantOperatingVariances

FinancialAssistance NZTA fi nancial subsidy was $311,000 lower than planned. The will be variation between the budget and the actual expenditure as Council has a three year approved roading pro- gramme with NZTA. This results in fl uctuations over the three year budget cycle. However over the three year cycle Council has remained within the approved NZTA budget programme.

Buller District Council 67

SignificantCapitalExpenditure • Upgrade of Derby Street in Westport, between Salisbury and Gladstone Streets ($248,000) • Pavement reseals: - Local roads and special purpose ($611,000) • Drainage renewal: - Local Roads ($78,000) - Special purpose roads ($43,000) • Traffi c services: - Local roads ($150,000) - Special purpose roads ($40,000) • Minor safety Improvements: - Local roads ($147,000) - Special purpose roads ($27,000) • Footpath upgrades ($182,000)

ExplanationofSignificantCapitalExpenditureVariances • Lower than budget expenditure occurred on sealed road resurfacing ($58,000). • Drainage renewals for local and special purposes roads ($78,000), minor safety for special purpose and local roads ($47,000) emergency works ($35,000). • The under expenditure in resurfacing was a reduction in areas to be resurfaced as a result of fl ood damage. These areas are to be included in the 2012/13 contract The contracts were tendered under the engineers estimates. There was a conscious effort, with the knowledge of the amount of higher than planned expenditure on emergency works, to keep within the overall roading budget. To enable this some works were deferred to the following years. • The deck of the Alexander Bridge was replaced ($92,000) against a budget of $25,400 (work in progress of $6,000 was carried forward to 2012/2013). The structural inspection of Alexander Bridge recommended painting of the steel beams and also drilling of timber components to determine strength. This bridge is over a deep chasm and while the scaffolding was erected, the opportunity was taken to have a full structural check of the bridge undertaken. This es- tablished that the bridge was only suitable for light traffi c, i.e. cars. The bridge is used to access a farming block, and as there is no other access, the replacement of the deck was brought forward for safety reasons. Buller District Council 6969

Water  Supplies Whatwedo? Council provides the management of the water supply to support the health and wellbeing of the com- munity. Council is currently responsible for water supply services for a number of townships in the district including Little Wanganui, Ngakawau-Hector, Waimangaroa, Westport, Cape Foulwind, Reefton, South Granity, Mokihinui, Inangahua Junction and Punakaiki. The Westport and Punakaiki supplies are treated with the remaining supplies not providing treated water. Water conservation programmes are used to ensure the long term availability and quality of the town water supply.

Whywedoit? Council intends to retain ownership of the water supply schemes for the following reasons:

Community Health Water is a necessity of life Community Safety The provision of fi re fi ghting capabilities Community Develop- The provision of reticulated water enables industrial and residential development ment Core Business Considered to be a core function of Local Government Exclusivity The ability to exclude or disconnect properties from a water supply has economic and public health implications. Public ownership can prevent the water supply being controlled in an exclusive manner Monopoly Supply The majority of properties have limited supply options Community Opinion The general public does not favour the privatisation of water supply services Legislation Section 130-135 of the Local Government Act 2002, places restrictions on the ability to divest or lose control over water supplies

For these reasons the objective of retaining ownership of the water supplies is to keep Council in a position whereby it can exercise some control over the supply of water to communities within the district. The goal of ownership is to use that control wisely and in the best interests of the affected communities.

HowwecontributetoStrategicGoals&CommunityOutcomes This activity supports the following community outcomes: Community Outcomes How the Council Contributes Health: By providing a reticulated water supply to support a healthy community By providing water for sanitary services. Safety: By maintaining suffi cient water for fi re fi ghting purposes. WaterSupplies

Environment: By conserving water and encouraging others to do the same. Education: By providing water conservation education. Economy: By meeting commercial water needs and meeting community needs at affordable costs and equal access to water. 70

HowCouncilPerformed Westport LongTermSolutionforWestportWater Council clearly identifi ed this as its highest priority. The provision of consistent, safe, potable water is a fundamental ser- vice for any local authority. The current supply has been in place since 1903. The treatment plant constructed in 1985 is no longer able to meet the latest drinking water standards. Finding a long term solution for the Westport Water Supply was Council’s highest priority. In the 2011/2012 Annual Plan Council had signalled that $2.5 million as a preliminary estimate for structural and monitoring upgrades for the Westport water Supply. This did not include the cost of replacing the trunk main which was an additional $2 million.

In November 2011 Council was provided with a report from Opus Consultants which detailed three options: • Upgrade the existing supply at a cost of $10.6 million • Change the source of supply to the Buller River with a gravity fed system ($15,641 million) • Change the source of supply to the Buller River with a pumped fed system ($13,423 million)

At the November 2011 Council meeting Council approved a phased upgrade of Westport Water Supply totalling $10.6 million over the next 10 years as refl ected below: Year Cost Details 2012/2013 $856,700 Improve Raw Water quality 2013/2014 $988,089 Filters refurbishment Seismic upgrade Filtered Water Storage for backwashing fi lters Filter to waste system 2014/2015 $1,501746 New plant and buildings Upgrade monitoring and control system UV disinfection and building Alkalinity correction system 2016/2017 $1,562,665 Raw ponds to excavate and remove material 2018/2019 $1,859,962 Piping of tunnels 1,2 and 3 2020/2021 $3,868,188

This is the programme of work that has been signalled in the 2012-2022 Long Term Plan. Council also received notifi cation in 2012/2013 that we had received $1.47 million as an initial subsidy from the Ministry of Health. Council has indicated that it intends considering the fi nancial impact of expediting the planned Westport water supply up- grade. This will be considered as part of the 2012/2013 Annual Plan.

ExistingWaterSupply Ongoing Issues with the existing Westport/ Carters Beach Water Supply were experienced: • In January 2012 as a result of an overnight storm, there was a major power outage near the Water Treatment Plant and the Carters Beach/ Westport water supply was not able to be fully treated at this time. However, the raw water was able to be chlorinated to give a level of protection, but boil notices were issued. • Four boil notices were issued for the Westport/Carters Beach Water Supply one in January 2012 during a power outage, and three between March and June 2012. The main issue was a hairline fracture in the steel casting of the pump body of the backwash pump. This allowed water to seep into the pump electrics causing a failure. The pump was installed and re-commissioned in late June 2012.

TunnelBracing Council undertook an inspection of the tunnels with an experienced Geotechnical Engineer ($70,000) that determined that no tunnel bracing was required during this fi nancial year.

Buller District Council 71

ReeftonWaterSupply Council approved two tenders that will allow for plans to upgrade the Reefton Water Supply to meet Ministry of Health Drink- ing Water Standards at the Council meeting on 27 April 2011. The Ministry of Health contributed 90% of the cost of this project with funding from the Drinking Water Assistance Programme and will cover $670,000 of the full project costs which are estimated to be $745,000. The upgrade to the supply occurred in two parts. The fi rst part to line the reservoir and construct a roof over the existing water reservoir in Reefton has been completed. The second part of the upgrade to the treatment process is currently in progress. A water treatment plant will be con- structed adjacent The Strand and will ensure that water delivered to the residents of Reefton complies with the Drinking Water Standards of New Zealand. Water will be fi ltered down to less than fi ve microns via a multimedia fi lter, and then further fi ltered to one micron through cartridge fi lters. Final disinfection will then be completed by exposing the water to ultraviolet light to disinfect the water. This upgrade includes capping the existing well head to secure the water supply against surface infi ltration and the provision of a back-up generator which is being undertaken outside of this tender process. The upgrading of the Reefton Water Supply will be completed in 2012 .

Othersupplies None of the supplies complied with the Drinking Water Standards of New Zealand 2005 (revised 2008) due to protozoa re- quirements. Council has a choice as to the Drinking Water Standards that it wishes to be measured against until Council is required to meet the provisions of the Health Amendment Act 2009. This Act requires Council to upgrade water supplies in the district progressively depending on the population served by the supplies. A reliable supply was provided in all areas with no water restrictions being imposed for any of Council’s supplies during the period. 5 total shutdowns of the Waimangaroa water supply occurred and 4 planned shutdowns were notifi ed at least 24 hours prior to the event, there was one unplanned emergency shutdown

Council received notifi cation that subsidies for the following Drink Water upgrades were approved: Ngakawau/Hector $219,000 Punakaiki $206,000 Waimangaroa $209,000

Only a portion ($668,000) of the Reefton and Punakai- ki Drinking Water subsidies were recognised in the 2011/2012 fi nancial year. The Drinking Water upgrades for, Waimangaroa and Ngakawau/Hector Water Supplies, which were sched- uled for 2011/2012, were deferred to 2012/2013. 72

KeyPerformanceIndicators What we did What we measured TARGET ACTUAL Provide an ad- Water Quality: equate quality No potential for ill- No confi rmed E coli A total of 2 e-coli tests were recorded showing contami- of water ness due to unwhole- contamination nation (2011: 10 tests showed contamination) some water In total there were 198 individual samples taken from Westport, Carters Beach, Reefton and Punakaiki water supplies. E-coli or faecal coliforms come from the gut of warm blooded animals (possums, deer, goats and birds) (2011: 169 samples) For the transgression for the Westport supply and the transgression for the Punakaiki supply, all consecutive day tests were clear of contamination The Punakaiki transgression also occurred when con- sumers were on a boil water notice to allow for a plant upgrade The boil water notice for Reefton will remain in place until the Water Treatment Plant is completed in 2012 Seven water sup- The Council programme in the Long Term Plan allows for plies will comply all water supplies, except Mokihinui and Cape Foulwind, with Drinking Water to be upgraded to meet the Drinking Water Standards in Standards 2005 (re- accordance with the Health Act vised 2008) Subsidies have been confi rmed for Westport, Ngakawau/ Hector, Reefton Waimangaroa and Punakaiki The upgrades are dependant on the provision of fi nancial assistance from the Ministry of Health The Waimangaroa and Ngakawau - Hector water supplies have funding approved and have been programmed for 2012/2013? Provide an Water Quantity - Westport and Reefton Supplies adequate quan- To be able to fi ll a No more than ten No request for pressure tests (2011: no request for pres- tity of water ten litre bucket three recorded failures sure tests) times within a minute per annum through- out the district All fi re hydrants to be Waimangaroa and All hydrants were operational (2011: all operational) operational Granity Fire Brigades check Waimangaroa and Ngakawau/Hec- tor supply Level of service 100%

Buller District Council 73

What we did What we measured TARGET ACTUAL Provide a reli- Water Reliability able supply of quality water To provide water into Water supplied 99% Water was supplied for 99.86% of the time (mains only) the system virtually of the time. (2011: 99.8%) all of the time. Measurement of the availability to individual laterals not To minimise disrup- currently measured. tion caused by un- There were 2 occasions when water was provided on planned shutdowns. low pressure because of repairs being undertaken on the 354mm trunk main (2011: 6 occasions) To permit gardens to be maintained in a No more than three 130 leaks were repaired over the 174 km of mains which healthy state all year. shutdowns per kilo- is 0.75 leaks per km (2011: 0.95 leaks per km) metre Response to failures The target is not deemed to be a relevant measure - within two hours. systems not in place to record this measure All unplanned shut- downs less than four The current measure is not a relevant measure so hours. Council has opted to measure how many service requests were attened to within agreed priority deadlines As service requests are received, Council assess the priority of the request and advises the contractor ac- cordingly Contractors responded to these priorities 93% of the time within agreed deadlines (2011: 90%) No more than fi ve No water restrictions for any of the supplies days of water re- strictions per year. Provide water Environmental Impact with the mini- mum environ- To comply with re- 100% compliance 100% compliance (2011: 100%) mental impact source consent condi- tions as assessed by Regional Council consents 74

2011/2012 2011/2012 2010/2011 WaterSupplies Actual Budget Actual $(000) $(000) $(000)

OPERATING REVENUE Targeted Rates 1,538 1,531 1,353 Fees and Sundry 229 234 215 Financial Assistance 668 1,393 0 TOTAL Revenue $2,435 $3,158 $1,568

OPERATING EXPENDITURE Employee Benefi t Expenses 0 0 0 Depreciation and Amortisation 525 574 525 Finance Costs 152 136 153 Other Expenses 1,070 1,015 1,173 1,747 1,725 1,851 Less: Internal Interest (122) 0 (126) TOTAL Expenditure $1,625 $1,725 $1,725

NET Cost/(Surplus) of Services $(810) $(1,433) $157

Capital Expenditure - Renewals 500 718 539 Capital Expenditure - Increases in Levels of Service 1,023 4,078 568 TOTAL CAPITAL EXPENDITURE $1,523 $4,796 $1,107

ExplanationofSignificantOperatingVariances

FinancialAssistance The reduction in fi nancial assistance to budget is attributable to the reduction in the Drinking Water Subsidies received from the Ministry of Health.

Reefton and Punakaiki upgrades were in progress as at 30 June 2012 and the subsidies were only partially recognised ($668,000). Ngakawau-Hector and Waimangaroa Drinking Water Upgrades were deferred. Overall subsidies for drinking water upgrades were reduced by $725,000 to budget.

OtherExpenses Repairs and maintenance and Contract Administration/supervision costs were higher in the Westport, Reefton and Waiman- garoa water supplies ($84,000). This was mainly due to repeated failures of the Westport/Carters Beach backwash pump, trunkmain repairs in Waimangaroa and a higher than anticipated volume of repairs for the Reefton water supply.

Buller District Council 75

SignificantCapitalExpenditure

WestportWater-SupplyUpgrade A start was made on the proposed improvements to Westport water supply. Expenditure on professional services during this fi nan- cial year were for a leak detection analysis and report, measurement and collection of data on the capacity of the existing intake, and for a report detailing the various options for upgrade of the water supply ($221,000). Work in progress for the 2011/2012 year totalled $308,000.

WestportWater-OtherCapital Reticulation was renewed in sections of Romilly Street, Peel Street, Shellswell Street, Derby Street and Snodgrass totalling $256,000.

ReeftonDrinkingWater-SupplyUpgrade The upgrade of the Reefton water supply treatment was started with a new roof being constructed over the reservoir, the construc- tion of the treatment plant building and most of the treatment equipment. A failure of a pipe connection has resulted in delays to the commissioning of the plant. $274,000 has been capitalised for the lining of the reservoir and constructing the reservoir roof and $768,000 has been carried forward to 2012/2013 as work in progress.

PunakaikiDrinkingWater-SupplyUpgrade The upgrade commenced in 2011/2012 $30,000 was capitalised for water tanks, and $30,000 was carried forward as work in progress.

ExplanationofSignificantCapitalExpenditureVariances In the 2011/2012 Annual Plan $2.5 million was budgeted as a preliminary estimate for the upgrade of the Westport Water Supply. For the 2011/2012 only $308,000 was spent on professional services as detailed above. Likewise $250,000 was budgeted for an upgrade of the trunkmain renewal.

The amount included in the budget for trunk main renewal was to allow a start on the trunk main replacement if the water treat- ment plant upgrade progressed. As the full upgrade did not progress this curtailed any further work on the trunk main replace- ment. The replacement of the trunk main is included in the programmed upgrade detailed in the 2012-2022 Long Term Plan.

The Drinking Water upgrades for Waimangaroa ($245,000) and Ngakawau/Hector Water ($315,000) Supplies which were scheduled for 2011/2012 were deferred to 2012/2013.

Reefton and Punakaiki upgrades were in progress at year end. Reefton ($274,000) was capitalised for the lining of the reservoir and constructing the reservoir roof, and partial construction of the new treatment plant ($532,000) has been carried forward as work in progress for 2012/2013.

$30,000 was capitalised for the Punakaiki water tank with $30,000 being carried forward as work in progress to 2012/2013. 76

WaterSupplies Estimated Water Current Standard Target Standard Upgrade Required Cost Supply ($000’s) Westport Ungraded Satisfactory, low level of risk Existing treatment with $10,638 for source, treatment and the addition of ultra violet distribution disinfection (Bb) Punakaiki Unsatisfactory, high level Marginally satisfactory, moder- Covered storage, fi ltration $230 of risk at source, treat- ate level of risk for source, and disinfection ment and distribution treatment. Satisfactory, low level of risk for distribution Awaiting approval of ap- plication by MOH (Ee) (Cc) Reefton Unsatisfactory level of risk Marginally satisfactory, moder- Cover reservoir and disin- $745 for source and treatment. ate level of risk for source, fection Unacceptable level of risk treatment and distribution for distribution (Cc) (Ee) Waimanga- Ungraded Marginally satisfactory, moder- Covered storage, fi ltration $245 roa ate level of risk for source, and disinfection treatment and distribution (Cc) Upgrade in 2012/2013 Ngakawau/ Ungraded Marginally satisfactory, moder- Covered storage, fi ltration $260 Hector ate level of risk for source, and disinfection treatment. Satisfactory, low level of risk for distribution (Cc) Upgrade in 2012/2013 Inangahua Ungraded Marginally satisfactory, moder- Disinfection and fi ltration $74 Junction ate level of risk for source, treatment and distribution Upgrade deferred to (Cc) 2013/2014 Mokihinui Ungraded Marginally satisfactory, moder- Covered storage, fi ltration $180 ate level of risk for source, and disinfection treatment and distribution No upgrade planned (Cc) Little Ungraded Marginally satisfactory, moder- Covered storage, fi ltration $70 Wanganui ate level of risk for source, and disinfection treatment and distribution Upgrade deferred to (Cc) 2013/2014 South Gran- Ungraded Marginally satisfactory, moder- Covered storage, fi ltration Cost to be ity ate level of risk for source, and disinfection determined treatment and distribution Upgrade deferred to (Cc) 2013/2014

Compliance with these Drinking Water Standards will only be achievable if Council receives the budgeted fi nancial assistance.

Buller District Council 7777 Solid Waste Whatdowedo? The Solid Waste Activity provides for the collection, transfer and final disposal of waste materials gener- ated by households and businesses within the District.

Council currently provides domestic refuse and recycling (rubbish) and recycling collections to houses in Westport and Reefton and most rural areas. However some have no collection. An estimated 3,069 tonnes of refuse is cur- rently transported out of the District to landfi lls in Nelson as this is the most cost effective option. Council currently operates transfer stations and recovery parks in Westport and Reefton. These sites are used by all District residents and businesses for the disposal of separated recyclable materials, household hazardous waste and garden waste. Council also operates two active landfi lls at Karamea and Maruia. Council provides for the aftercare of Council’s closed landfi ll sites at Birchfi eld, Westport, Charleston, Inangahua, Reefton, Springs Junction and Ikamatua, and monitors groundwater quality at these sites as required under resource consent conditions. Council also has a role in facilitating waste minimisation behaviours within communities. This is put into effect by providing resources for education programmes into schools about sustainability and waste minimisation. Support is provided to businesses to develop more sustainable practices.

Whydowedoit? Solid Waste Management is necessary for the health and quality of life for the community. It supports local develop- ment and assists in maintaining a quality environment. Council promotes recycling and waste reduction to better support these goals. Council provides programmes to encourage reusing and recycling and to motivate behaviour change. Council provides kerbside recycling, greenwaste, composting and recycling drop off facilities at refuse stations, and Council wishes to promote recycling and waste reduction to better support these goals.

HowwecontributetoStrategicGoals&CommunityOutcomes This activity supports the following community outcomes: Community Outcomes How the Council Contributes Health: By the collection and disposal of refuse

Safety: By collecting and disposing of refuse in a safe, effi cient and sustainable manner that maintains district natural and aesthetic values The solid waste disposal minimises risk of waste being inappropriately or danger- ously disposed of Environment: By providing safe collection and disposal of refuse by encouraging waste minimisa- tion Education: Provide programmes to schools and the community on waste care and reduction

Economy: By meeting commercial needs for dealing with waste SolidWaste 78

HowCouncilPerformed

All of the Council operating and closed landfi lls were monitored during the year and a report was prepared for the West Coast Regional Council on the results of this monitoring.

Refuse and recycling was collected weekly from all properties within the collection area.

Residual refuse was transferred to the Nelson tip for disposal. Council carted 3069 tonnes of refuse to Nelson which is less than the 5,000 tonnes forecasted when the service started (2011 : 3,079).

No further development on the landfi ll has occurred. Council is in the process of applying for a designation over the site as part of the District Plan review. Costs associated with the purchase of Caroline Terrace and associated with Landfi ll design have been capitalised ($521,000 and $161,000 for feasibility and design). Work is still continuing to fi nalise the designation (work in progress $14,000). The Waste Minimisation Act 2008, required Council to complete an assessment of its current practice and write an updated Waste Minimisation and Management Plan (WMMP) to become operative by 1 July 2012. These plans once adopted by Council are required to be reviewed and re-adopted every six years. The next effective date will be 1 July 2018. Effectively they become working documents that allow Council to continue to monitor, improve and introduce change as the need arises with any changes or improvements introduced being recorded and becoming part of the Plan at each review date. Consultation took place in May and June 2012 and the Plan was adopted in June 2012. Council identifi ed fi ve specifi c areas where the Council can improve the current service provided and move towards better compliance with the specifi c requirements of the Waste Minimisation Act: 1. Council needs to change its collection method to a more cost effective system that places greater emphasis on recycling of product. 2. Consider making the disposal of greenwaste either free or minimal cost to encourage greater volume dis- posed at approved facilities. 3. Consider collection of organic waste to reduce residual refuse volumes and disposal to reduce greenhouse gas emissions. 4. Create an opportunity for the disposal of approved cleanfi ll. 5. Enhance education programmes to be more encompassing and wider reaching of a broader range of recy- clable and reusable product.

Council also signalled in its Long Term Plan their intention to move from a Council delivered waste disposal system, to an enhanced and environmentally sustainable waste solution for the entire District. The enhanced service could be funded and operated “in house” as a Council service of the District could move to a service where the refuse collection, recycling, landfi lls and transfer stations will be operated by an independent contractor. Prospective op- erators will be encouraged to offer prices for 2 or 3 bin options, as part of a tender process.

Buller District Council 79

KeyPerformanceIndicators WHAT WE DID WHAT WE MEASURED TARGET ACTUAL To encourage waste min- Monitoring of Council’s Continue to All sites monitored and reports provided to imisation and recycling solid waste facilities monitor and West Coast Regional Council in accordance with to support the health of provide reports resource consents the community and the to West Coast Results indicate that fi nal capping of the closed environment and to en- Regional Council landfi lls should be considered as well as some courage sustainable use changes to the resource consent conditions of our natural resources Total amount of waste Reduce by 5% Reduction over last 12 months is 1% (2011: less To provide a safe and (tonnes) sent to land- per annum than 1%) environmentally sound fi ll per year solid waste collection, Publication of infor- Four articles Four articles were distributed (2011: fi ve arti- treatment and disposal mation and articles cles) service for community mem- bers Provide programmes Council con- The programme to schools was previously under- to schools on waste tributes to taken by the Waste Minimisation Offi cer whose care, refuse and Enviroschools position was funded through the Ministry for the recycling Programme Environment and the other West Coast Councils which delivers presentations to This position was disestablished at the end of schools 2009 Council now contributes to the Enviroschools Programme which is delivered to schools that are prepared to take part in the programme This programme was also stopped, however it is due to recommence in 2011/2012 Council staff took two school groups through the transfer station and recycling facility 80

2011/2012 2011/2012 2010/2011 SolidWaste Actual Budget Actual $(000) $(000) $(000)

OPERATING REVENUE Targeted Rates 751 746 642 Fees and Sundry 709 751 600 Financial Assistance 0 0 0 TOTAL Revenue $1,460 $1,497 $1,242

OPERATING EXPENDITURE Employee Benefi t Expenses 0 0 0 Depreciation and Amortisation 95 76 79 Finance Costs 1 175 155 Other Expenses 1,781 1,692 1,799 $1,877 $1,943 $2,033 Less: Internal Interest (82) 0 (72) TOTAL Expenditure $1,795 $1,943 $1,961

NET Cost/(Surplus) of Services $335 $446 $719

Capital Expenditure - Renewals 50 5 390 Capital Expenditure - Increases in Levels of Service 0 60 0 TOTAL CAPITAL EXPENDITURE $50 $65 $390

ExplanationofSignificantOperatingVariances FinanceCosts The closure liability expense reduced by $107,000 resulting in a favourable variance to budget.

OtherExpenses Higher than anticipated costs of operating the landfi ll and transporting the refuse and recycling largely accounted for the budget overrun ($84,000) offset by savings across a number of expenses. SignificantCapitalExpenditure The purchase of Caroline Terrace ($460,000)and associated land for the Buller District landfi ll ($64,000) were capitalised. An amount of $161,000 for site analysis and design was also capitalised. Expenditure of $14,000 has been incurred on obtaining a designation has been carried forward to work in progress. Prior year expenditure ($91,000) was associated with feasibility, design and compensation was written off from work in progress.

ExplanationofSignificantCapitalExpenditureVariances At this stage Council has purchased the land at Caroline Terrace for the Buller District Landfi ll and is in the process of ap- plying for a designation over the land. The land purchases were capitalized in 2011/2012 ($521,000) and the expenditure obtaining a designation has been carried forward to work in progress ($14,000). Work in progress of $750,000 was carried forward from 2010/2011. Expenditure associated with design and compensation totalling $91,000 was written off from work in progress in 2011/2012. The Council deferred the installation of the concrete fl oor in the transfer station storage facility ($60,000) until decisions are made on the future location of WestReef Services Ltd.

Buller District Council 8181 Wastewater Whatdowedo Council provides these activities to support the health and wellbeing of the community and the environ- ment. Currently Council provides for the continuous collection and transportation of the wastewater from residential and commercial properties of the township of Westport, Little Wanganui and Reefton through underground piping infrastructure and treatment facilities. The rest of the district is serviced by on site disposal systems that property owners are responsible for maintaining. Council is investigat- ing areas where septic tank systems can be upgraded, whether by including these into the reticulated system or assisting with subsidy applications for communities to upgrade areas of concern to mitigate potential environmental risks.

Whydowedoit Council intends to retain ownership of the sewer systems for the following reasons: • The provision of wastewater services is considered to be a core service The ability to exclude or disconnect properties from the sewer reticulation had economic and public health • implications. • Public ownership can prevent the sewer system from being controlled in an exclusive manner

For these reasons the objective of retaining ownership of the wastewater system is to use that control wisely and in the best interests of the affected communities.

HowwecontributetoStrategicGoalsandCommunityOutcomes This activity supports the following community outcomes: Community Outcomes How the Council contributes Safety By providing a sanitary wastewater collection and treatment service

Environment By protecting the environment through the wastewater treatment

Health: By providing a sanitary wastewater collection and treatment service

Education By providing water conservation programmes

Economy By meeting commercial wastewater needs and meeting community needs at afford- able costs

HowCouncilPerformed Monitoring and reporting of the Wastewater Treatment Plants has been undertaken in accordance with the re- source consents. The composting of biosolids from the Wastewater Treatment Plant with greenwaste from the Transfer Station has continued at Westport. Stormwater that is disposed of in combination with wastewater has resulted in some areas of Westport’s wastewa- ter system not working effi ciently because of overload. This has resulted in residents being unable to use toilet facilities for periods when the system is overloaded. Council has requested modelling of the wastewater system to programme separation and also to provide solutions. Wastewater Ongoing upgrade of Derby Street has continued with the block from Cobden Street to Pakington Street being com- pleted. The modelling of wastewater and stormwater reticulation has been completed by the Consultant, but not verifi ed to the satisfaction of Council, and capital expenditure is to be carried forward to 2012/2013 to enable the analysis to continue. 82

KeyPerformanceIndicators WHAT WE DID WHAT WE MEASURED TARGET ACTUAL Public Safety: Provide safe facilities No accidents, injuries or pub- Supplying reticu- No accidents recorded (2011: no injuries) for both the community lic contact with sewage lated sewer sys- and the operators tems that support public health and operator safety Number of public health is- Maintain zero No reports (2011: nil) sues attributed to the waste- reports water system No intrusions or injuries Maintain zero No intrusions and no injuries arising from reports intrusions (2011: nil) System Capacity: Provide adequate Maintain capacity of existing No more than ten 6 of the 16 sewerage overfl ows occurred capacity combined systems overfl ows through- on the Carters Beach rising main between out the district Carters Beach and Westport (2011: 11 Design all new systems to overfl ows) nationally acceptable stand- ards. These are unavoidable due to inferior pipe being installed in 1995 Derby Street from Cobden Street to Pakington Street was designed to meet NZS4104:2010 which are the Engineering Standards adopted by Council No new systems constructed System Reliability: Provide a reliable To accept sewage from prop- No more than one Council has 74.7 km of sewerage mains sewer system erties virtually all of the time blockage per kilo- and for the 2011/2012 year we had 25 metre of pipeline blockages which equals 0.34 blockages per kilometer of pipe. This is less than the target level indicated (2011: 21 blockages which equals 0.39 blockages per kilometer of pipe) All blockages One blockage took six hours to clear due cleared within four to a manual excavation in a confi ned area hours All other blockages were cleared in ac- cordance with response times No more than 40 Within the Westport/Carters Beach, blockages in later- Reefton and Little Wanganui Subdivision als sewerage schemes there are over 3,000 property connections (laterals) Over all three sewerage schemes there were a total of 52 lateral blockages that required clearing This is 12 more than the targeted level (2011: 39 lateral blockages)

Buller District Council 83

WHAT WE DID WHAT WE MEASURED TARGET ACTUAL Environmental Impact: Provide sewer collec- To comply with resource 100% Reefton Waste Water Treatment Plant tion and disposal with consent conditions compliance (WWTP): the minimum environ- Reefton WWTP consent requires scheduled mental impact monitoring 9 times per annum for a variety of analytes at various locations The Ponds are monitored for Dissolved Oxy- gen levels, odours, and a variety of poten- tial visual anomalies The effl uent in the ponds discharge channel is monitored for various analytes including Biological Oxygen demand, Faecal Coli- forms, Ecoli, and Total Suspended Solids Receiving water quality is also undertaken downstream at the confl uence of Cemetery Creek and the Inangahua River. Analytes in- clude Visual clarity of the water, Biological Oxygen demand, Suspended Solids, Union- ised Ammonia, Dissolved Oxygen, pH, Water Temperature, Faecal Coliforms, and Ecoli Additionally annual monitoring of the sedi- ments in the discharge channel is required on an annual basis. Analytes for this include Arsenic, Cadmium, Chromium, Copper, Mer- cury, Nickel, Lead, Zinc, and Poly Aromatic Hydrocarbons Analytes that were in breach of the consent conditions on 8 occasions were: Arsenic (1), Copper (1), Lead (1), Mercury (1), and Zinc (1) were detected in Cemetery Creek. - The same analytes were tested for at the ponds discharge point and were not detected, supporting the theory that the metals detected in Cemetery Creek may originate from upstream of the WWTP and are not present as a result of the wastewa- ter treatment plant. Other non compliance was for Temperature (1), Ecoli (1) and Faecal Coliform (1) results in the Inangahua river sites. 84

KeyPerformanceIndicators WHAT WE DID WHAT WE MEASURED TARGET ACTUAL Environmental Impact: continued.... Provide sewer collec- To comply with resource 100% Conveyance Pump StaƟ ons: tion and disposal with consent conditions compliance the minimum environ- Large parts of Westport’s sewer network mental impact also double as its stormwater network. This leads to large quantities of rainwater entering the sewer system. Prior to the 2006 upgarde of Westports sewerage system this was not an issue. However the sewerage treatment upgrade required the construc- tion of sewerage pumping stations at the sewer / stormwater outfalls, in order to transport the sewerage to the Alma road treatment plant. It was deemed to be un- economic and impractical to size the pump stations and the treatment plant to treat this huge volume of additional stormwater. This was recognised in the Westport Waste Water Treatment Plant consent which al- lows for storm water induced overfl ows to occur at the 3 outfall sewer pump stations located at Pakington, Rintoul and Roebuck St outfalls. Stormwater induced overfl ows are moni- tored by testing the receiving water quality downstream of the pump station concerned, and recording the dates times and durations of these events. As well as monitoring water quality at two recreational (Marr’s and Shin- gle) beach locations downstream There were 18 breaches for overfl ow moni- toring, Ecoli (8), Enterroccoci (3) Faecal Coliforms (7) It is noted that as the pump stations are located prior to the treatment plant, that council can only monitor the upstream and downstream contaminant levels, and cannot alter the concentration or dilution or dura- tion of the sewerage overfl ows to the river during these rain overfl ow events.

Buller District Council 85

WHAT WE DID WHAT WE MEASURED TARGET ACTUAL Provide sewer collec- To comply with resource 100% compli- Westport Waste Water Treatment Plant (WWTP): tion and disposal with consent conditions ance the minimum environ- The Westport Waste Water Treatment Plant mental impact consent requires monitoring of receiving wa- ters in the Buller river 9 times per annum. Analytes include Visual clarity of the water, Biological Oxygen demand, Suspended Sol- ids, Unionised Ammonia, Dissolved Oxygen, pH, Water Temperature, Faecal Coliforms, and Ecoli. As well as observing whether any scums, discoloration or odours are present The consent also requires monitoring of the effl uent quality at the point where it leaves the treatment plant, 9 times per annum. Analytes for this include Biologival oxygen demand, Faecal coliforms, E.coli, Suspend- ed solids, conductivity, effl uent volume Once per year the sediments in the Buller river are tested for levels of various con- taminants, These analytes include Alumini- um, Arsenic, Cadmium, Chromium, Copper, Mercury, Nickel, Lead, Zinc, Cyanide Phenol, and Total Hydrocarbons Leaving the treatment plant there were 7 breaches, three of these were for the presence Ecoli and four were for Faecal Coliforms No complaints regarding Zero Nil unsubstantiated smell complaints re- objectionable odour from the ceived (2011: one unsubstantiated com- treatment plants plaint was received) Buller District Council 8787 Stormwater Whatdowedo? Stormwater management systems are an integrated set of procedures and physical assets designed to manage the surface runoff from urbanised catchments.

Council manages open drain stormwater systems in Hector, Ngakawau, Seddonville, Granity, Waimangaroa, West- port, Carters Beach and Reefton. In addition there is a piped stormwater system in Westport. Sections of the Westport piped sewer system and all of the Reefton piped sewer system also convey stormwater. In Punakaiki, the only public stormwater drain is maintained by NZTA as part of their roading network. In other townships, such as Mokihinui or Little Wanganui, there are no formal stormwater systems at all - stormwater simply soaks to ground naturally.

Whydowedoit? Council provides stormwater systems to manage surface water runoff from urbanised catchments in a way that achieves a balance between the level of protection and the cost to the community. Council intends to retain owner- ship of the stormwater systems. This continued ownership is justifi ed on the following grounds: Public Benefi t - the service is deemed to provide a public benefi t, through the protection of property Health and Safety - the provision of stormwater systems reduces the risk of death or injury resulting from fl ooding or private property Core Business - the provision of stormwater systems is considered to be a core function of Local Government Exclusivity - the ability to exclude or disconnect properties from a stormwater collection system has economic and public health implications. Public ownership can prevent the stormwater system being controlled in an ex- clusive manner Monopoly Supply - the majority of properties have limited options

HowweContributetoStrategicGoals&CommunityOutcomes The most signifi cant outcome supported by the provision of stormwater systems is a healthy community. Uncon- trolled stormwater runoff can be destructive and represent an immediate risk to life. Over the longer term, stagnat- ing pools of water can become a breeding ground for disease. Two other service outcomes supported by the stormwater systems are prosperous and sustainable communities, through the minimisation of stormwater damage and the protection of the environment.

HowdidwePerform Stormwater that is disposed of in the wastewater pipes have resulted in areas of Westport where wastewater sys- tems could not be used during rainfall events. Modelling of the wastewater system will determine areas of the town where additional stormwater separation will be required. During this year there have been more overfl ows compared with previous years. No residentIal houses were inundated. The overfl ows are because pipes are at full capacity Reconstruction of Derby Street involving upgrades of the stormwater disposal began in March 2011. This upgrade is a long term project and Council has planned to upgrade underground services and reconstruct the road two blocks Stormwater per annum to ensure that the costs are spread out over a period of time for the ratepayers. 88

KeyPerformanceIndicators WHAT WE DID WHAT WE MEASURED TARGET ACTUAL Provide adequate Maintain capacity of existing sys- Number of defi cient One new main constructed designed stormwater capacity tems and have all new systems designs found for a 1 in ten year event (2011: one designed with a minimum 1 in 10 new main) year event without ponding, and a 1 in 50 year event without in- No more than fi ve No houses inundated with stormwater undation of dwellings houses inundated by (2011: nil) stormwater fl ooding per annum Provide a reliable Maintain the stormwater system 90% compliance with 14 service requests of which 13 were stormwater system in a state of readiness by identi- response times as completed on time fying no more than 20 faults per stated in the service annum during quarterly inspec- request 93% of service requests completed tions within response times (2011: 100%) Regular inspections of stormwater sys- tem were undertaken These will pick up loose or stuck man- hole lids, buildup of silt and if fl ood- gates are blocked by silt or debris re- pairs are undertaken to remediate Minimise disruption caused by Monitor and record There were 4 blockages to the storm- obstructions blockages water system that resulted in main clearance (2011: eight blockages) These blockages did not result in any signifi cant fl ooding Provide a stormwater Compliance with Resource Con- 100% compliance Currently no resource consents for system with minimal sents stormwater due to existing use environmental impact Stormwater system was in place prior to the Resource Management Act

Buller District Council 89

2011/2012 2011/2012 2010/2011 Wastewater&Stormwater Actual Budget Actual $(000) $(000) $(000)

Operating Revenue Targeted Rates 1,882 1,895 1,807 Fees and Sundry 101 251 11 Financial Assistance 0 0 0 TOTAL Income $1,983 $2,146 $1,818

Operating Expenditure Employee Benefi t Expenses 0 0 0 Depreciation and Amortisation 757 759 750 Finance Costs 358 406 418 Other Expenses 1,394 1,330 1,339 2,509 2,495 2,507 Less: Internal Interest (358) 0 (418) TOTAL Expenditure $2,151 $2,495 $2,089

NET Cost/(Surplus) of Services $168 $349 $271

Capital Expenditure - Renewals 470 616 355 Capital Expenditure - Increases in Levels of Service 58 145 0 TOTAL CAPITAL EXPENDITURE $528 $761 $355

SignificantOperatingExpenditureVariances Fees&Sundry Council budgeted to receive $218,000 for the Orowaiti Sewerage Scheme connection charge. This income was recognised in 2009/2010. This was offset by a prior year unbudgeted contribution from a large subdivision in Westport ($72,000).

OtherExpenses The activated sludge waste water treatment plant produces biosolids on a daily basis as part of the treatment of sewerage. The biosolids needs to be disposed of and the production of compost is a safe and productive way of dealing with the biosolids. Higher costs ($66,000) were incurred because of the shortage of greenwaste material taken to the transfer station. The over- run on the production of compost should not be taken out of context as it is just one of aspect of the wastewater treatment. Overall the Westport wastewater was 4.7% over budget.

InternalInterest Internal Interest was higher than budget as projects were funded internally rather than through external loans. 90

SignificantCapitalExpenditure Critical Spares for the Waste Water Treatment Plant ($113,000). The budget for the spares in 2011/2012 was $95,000 and $38,000 was carried forward from 2010/2011. Greenwaste Biosolids Mixing Machine ($60,000) Continued phased upgrade of Derby Street ($93,000) Reefton telemetry upgrade ($19,000) Additional manholes for Reefton sewerage ($29,000) Main renewals for Little Wanganui sewerage ($37,000) Stormwater Main Renewals ($73,000)

SignificantCapitalExpenditureVariances Deferment of the sewer modelling and separation ($50,000) Deferment of the movement of the septic facility in Westport ($25,000) Deferment of the stormwater pumping station in Brougham Street ($271,000) . This has been deferred until the modelling of the Wastewater reticulation system was completed and an appropriate decision regarding the benefi ts and effects of constructing the pump station could be determined. The capital project has been carried forward to the 2012/2013 fi nan- cial year Minor budget overruns on main renewals for Little Wanganui sewerage and critical spares for the Westport Waste Water Treatment Plant were recorded.

Buller District Council 9191 Support Services Whatdowedo? The goal of Support Services is to be effi cient, service orientated and accountable to Council and includes the following functions: • Management functions • Corporate planning • Financial and accounting operations - monitoring and fi nancial reporting • Generation of Annual Plans, Long Term Plans and Annual Reports • Rating operations • Customer Service Centres in Westport and Reefton • Human Resources management • Information Technology management • General administration • Health and safety compliance & legal counsel • Monitoring and compliance of all Council Controlled Organisations • Guidance and monitoring of Holding Company performance • Asset Management

Whydowedoit? The activity is intrinsic to the support and functioning of all Council’s activities and service provision.

ContributestowhatCommunityOutcome Support Services covers all the community outcomes as it provides the administrative and operational capacity to achieve them SupportServices 92

HowCouncilPerformed LeaseholdLand In June 2010 Council passed a resolution approving 20% discount off the market value of its Endowment Leasehold Property as an incentive to encourage leaseholders to freehold this type of property from Council. This offer expired 30 June 2011. The current scheme approved by Council closed on 30 June 2012. At this date there were 65 completed freeholding transac- tions with a total $3.98m of funds that have been paid to Council over the 2 year period the scheme has run. This represents 51% percent of the total number of properties that Council owned at the start of the scheme in 2010. The scheme has proved highly successful, realising signifi cant funds for Council, and has delivered signifcantly better returns for the ratepayer.

InformationSystems Council has continued to improve and develop information systems. During the fi nancial year a Debt Management Module to address debt recovery and a Customer Database was installed to improve relationships and frontline communications with ratepayers.

InvestigationintoaSharedITSystem: Buller District participated in a project with Grey and Westland District Council’s and the West Coast Regional Council to investigate the feasibility of a Shared IT System. A full business case with a confi rmed technical architecture was presented to the Chief Executive Offi cer in October 2011. At this stage Buller and Westland District Council decided not to participate in the Shared Services.

HealthandSafety On-going development of Health and Safety Procedures has occurred to show compliance with legislation. Council achieved Secondary Workplace Safety Management Practices Accreditation after the Health and Sfety Audit in November 2011.

DevelopmentWestCoastExtraordinaryFunding A one-off $2 million extraordinary distribution was made available to our Council in this fi nancial year. The pool of funds is used for the development of community assets and/or projects that will contribute to sustainable economic benefi ts for the Buller District. The Grants Committee held two funding rounds in December 2011 and April 2012. Council has allocated $1,630,500 towards various community projects spread throughout the District as shown below: Organisation Project details Amount ap- proved ($) Buller Rugby Football Union To install new lights at Craddock Park Rugby Football Ground to comply $25,000 with the standard to play rugby at night Carters Beach Hall Commit- To upgrade the Carters Beach Community Hall $50,000 tee Karamea Medical Associa- Construct a new replacement house for medical staff $195,000 tion Salvation Army Building work for “The Shed” project $50,000 Sunset Speedway Club Replacement of outdated safety fence to meet new imposed standards $25,000 Westport Kindergarten Construction of a second kindergarten to address large numbers of pre- $100,000 Association school children that cannot access childhood education in Buller Coaltown Trust Construction of Cultural Hub – relocating the museum and I-Site into a $500,000 central location Reefton Powerhouse To reconstruct the original power house and water race to be a complete $400,000 Sub-committee working unit Mokihinui-Lyell Backcoun- Create an 80km iconic walking/cycling trial – The Old Ghost Road. Facilities $250,000 try to include huts, toilets and interpretive material Trust Seddonville Community To relocate the fi re station and Library from fl ood area to higher ground at $35,500 Association the Seddonville Domain TOTAL $1,630,500 Approved:

We look forward to seeing these projects develop and take shape in the Buller community. Each of the organisations have made signifi cant progress from the hard work and dedication from volunteers and the funding from the Extraordinary Fund has kickstarted key projects within the District. Buller District Council 93

LongTermPlan-FinancialStrategy One of the requirements for this year’s Long Term Plan was the development of a Financial Strategy. The overarching Fi- nancial Strategy is to ensure that rates remain affordable to the average ratepayer and that net borrowings are fi nancially sustainable. The Financial Strategy demonstrated that Council is forecasting a relatively low level of net debt while maintaining a substan- tial capital improvements and replacement programme of $57.7 million addressing infrastructure defi cits. To manage volatile rate movements the Council smoothed its rates by under-rating in 2013 and recovering this amount in 2014. Council received an unqualifi ed opinion from Audit New Zealand on its Long term Plan which was adopted by the statutory deadline. KeyPerformanceIndicators WHAT WE DID WHAT WE MEASURED TARGET ACTUAL Prioritise and Net operating results Operate within overall Within overall budgets with exceptions have been not- manage operat- and net capital re- budgets ed and explanations provided ing expenditure sults within overall and capital ex- budget Council operating defi cit of $0.7 million versus a budg- penditure et surplus of $1.6 million (2011: $647,000 defi cit) Net Capital Expenditure $5.3 million (2011: $5.5 mil- lion) Maintenace of Statutory compli- Continue to provide up- Continued availability of rating information to all rating inforam- ance and availability dated rating informa- members of the public tion database of rating information tion available to public in compliance to public in Westport at Westport and Reefton with Local Rat- and Reefton Offi ces and on website ing Act 2002 Maintenance of Availability of fi nan- 99% availability with no 99% availability with no extended downtime on all crit- Council’s infor- cial and operational extended downtime on ical applications (2011: 99%) mation systems systems including GIS all critical applications including GIS systems to support and fi nancial provision of Council and regulatory services for effective systems decision making Customer Ser- Customer informa- The number of business The number of transactions at Westport Customer Ser- vices provides tion services are transactions carried out vices averages 5,700 per month, and 6,000 per month the fi rst point available to all cus- at Customer Service for Reefton of contact for tomers. The activ- customers ity employs highly The number of transactions is not relevant as a meas- trained and skilled ure of Customer Service (0.1%) rather the number of staff who have local complaints as a % of transactions is indicative of the and Council knowl- quality and effectiveness of service provided This services edge and can provide Customer Services log all Customer Service Requests includes a web- clear, consistent and and handle all frontline enquiries such as rating en- site (www.bull- accurate information quiries, payments, dog registrations and lodging of all erdc.govt.nz), buidling consents telephone ser- vice and face In addition Reefton Service Centre handles Post Shop to face contact transactions and LTSA registrations through the Customer Ser- The breadth of services handled by Customer Services vices desk in is constantly reviewed to ensure customers enquiries Westport can be resolved at fi rst point of contact Number of complaints Complaints are handled and investigated by each de- received partmental manager No signifi cant fi ndings noted Customer satisfaction Survey has not been carried out survey - internal and ex- tenal 90% rating External customers provide feedback via a suggestion box in Customer Services - no negative comments re- ceived Complaints relating to staff / Council services are dealt with by the Management Team Monitor turnaround time Service request system has been implemented to log to resolve queries by in- all requests and monitor the deadlines for completion ternal departments. (875 logged with 852 being completed for this fi nancial year) Overdue service requests are escalated to the Team Leaders for resolution 94

KeyPerformanceIndicators WHAT WE DID WHAT WE MEASURED TARGET ACTUAL To reduce the Health and Safety Achieve and main- Secondary accreditation achieved incidence of tain ACC accredita- work related tion - measure savings accidents and achieved via rebates on to ensure that ACC levies Council com- plied with 100% compliance with Council complies with all Health and Safety policies Health and Council Health and and procedures Safety legisla- Safety policies and pro- cedures Work was been undertaken on improving the principal tion contractor relationship health and safety procedures and processes One complaint was received pertaining to Health and Safety The matter was investigated and no signifi cant fi ndings were noted Monitoring of contrac- Setting up systems to ensure that all contracts and con- tors safety and com- tractors comply with legislative requirements pliance procedures to ensure compliance with Council policies and statutory requirements

Buller District Council 95

2011/2012 2011/2012 2010/2011 SupportServices Actual Budget Actual $(000) $(000) $(000)

OPERATING REVENUE Fees and Sundry 3 0 2 Financial Assistance 67 0 0 Internal Recoveries 3,563 3,497 3,487 TOTAL Revenue $3,633 $3,497 $3,489

OPERATING EXPENDITURE Employee Benefi t Expenses 1,691 1,628 1,643 Depreciation and Amortisation 109 148 104 Finance Costs 188 142 205 Other Expenses 1,614 1,579 1,537 TOTAL Expenditure $3,602 $3,497 $3,489

NET Cost/(Surplus) of Services ($32) $0 $0

Capital Expenditure - Renewals 170 179 142 Capital Expenditure - Increases in Levels of Service 0 425 0 TOTAL CAPITAL EXPENDITURE $170 $604 $142

ExplanationofSignificantOperatingVariances Financial Assistance: Unbudgeted funds received from Development West Coast for allocations made from the Extraordinary Development Fund for community-based projects ($67,000). Employee Benefi ts: Unubdgeted healthcare benefi ts and accrued employee benefi ts accounted for the overrun on employee expenses ($63,000). Other Expenses: As Council made a decision not to proceed with the Shared Services IT system, costs incurred in the inves- tigation were expensed and represent unbudgeted costs in the 2011/2012 year ($55,000). In addition debt collection costs ($31,000) proved to be higher than anticipated. This was offset by minor savings across a wide variety of expenses.

SignificantCapitalExpenditure A Debt Management Module was implemented to improve Council Debt Recovery function. Other IT upgrades include an up- grade of the Microsoft Software and hardware, server and network upgrades ($170,000)

ExplanationofSignificantCapitalExpenditureVariances Council decided not to participate in the Shared IT System with the other local District Council ($400,000 capital budgeted was not required). Delays were experienced in the implementation of other IT projects accounting for the remainder of the under expenditure. This capital budget has been carried forward to the 2012/2013 fi nancial year. Buller District Council 9797 In-House ProfessionalServices Whatwedo? The Professional Services Unit provides engineering services to support the maintenance and develop- ment of Council infrastructure. This includes the preparation of contracts for roading, water, wastewater, solid waste and property. They monitor the performance of contractors and issue instructions for work found necessary as a result of requests for service and comments from ratepayers.

Whywedoit? The maintenance of an in-house professional services unit allows Council to access engineering services on a cost ef- fective basis. In-house expertise assists the effi cient management of Council roading and other infrastructure assets.

HowweContributetoStrategicGoals&CommunityOutcomes This activity supports the following community outcomes: Community Outcomes Safety By monitoring the conditions of Council assets and issuing requests for maintenance in time. Environment By monitoring landfi lls.

Economy By requesting necessary maintenance in time.

HowCouncilPerformed The professional services business unit provided monthly updates to Council on contracts under their jurisdiction in a timely manner. KeyPerformanceIndicators What we did What we measured Target Actual To provide engineering ad- Provide monthly reports on annual Prepare annual work Have continued to vice to Council and adminis- work programmes, monitor contract programmes and month- do the same ter contracts works and prepare monthly contract ly progress reports progress reports In-HouseProfessionalServices 98

2011/2012 2011/2012 2010/2011 In-HouseProfessionalServices Actual Budget Actual $(000) $(000) $(000)

OPERATING REVENUE Fees and Charges 1 9 1 Internal Recoveries 614 653 604 TOTAL Income $615 $662 $605

OPERATING EXPENDITURE Employee Benefi t Expenses 383 405 398 Depreciation and Amortisation 8 7 8 Finance Costs 2 2 2 Other Expenses 139 169 157 $532 $583 $565 Less: Internal Interest (2) 0 (2) TOTAL Expenditure $530 $583 $563

NET Cost/(Surplus) of Services $(85) $(79) $(42)

Capital Expenditure - Renewals 0 0 0 Capital Expenditure - Increases in Levels of Service 0 0 0 CAPITAL EXPENDITURE $0 $0 $0

ExplanationofSignificantOperatingVariances No signifi cant operating variances were noted.

ExplanationofSignificantCapitalExpenditureVariances There were no signifi cant capital expenditure variances noted.

Buller District Council 9999

Westport Harbour The Council Harbour operation was established under the Westport Harbour Foreshore, Seabed, Riverbed and Waters Control Order 1988, which came into force on 1 July 1998. A grant of control was given to the Council which has since then amalgamated into the Buller District Council.

Buller Port Services Limited, a wholly owned subsidiary of Holcim New Zealand Limited managed the harbour until 31 August 2010. Westport Harbour Limited took over the management contract from Holcim on 01 September 2010. On 01 September 2010 Council sold land and buildings to Westport Harbour Limited, and in consideration Buller Holdings issued 1,118,000 shares to Council with a par value of $1.00. The harbour is a key strategic asset and provides transportation opportunities for bulk cargos such as coal, cement, gypsum and timber. It also provides facilities for commercial and recreational fi shing. Harbour operations such as dredging and maintenance of the full and half-tide walls contribute to the effi cient fl ow of the Buller River during times of fl ood, providing a degree of protection to the town of Westport. Westport Harbour Limited will provide land, facilities, plant for receiving, delivery, stockpiling and shipment of a wide range of products and raw materials; the ownership of land and facilities necessary to maintain the company’s commercial assets; and the provision of facilities associated with the repair and servicing of vessels. It has now been agreed that assets would no longer be transferred to Westport Harbour Limited, but leased via an operating Lease.

ContributestowhatCommunityOutcome? This activity supports the outcomes of safety and economy.

This activity contributes to the community outcomes by: • Providing fl ood protection to the town of Westport; and • Promoting and enhancing opportunities for economic development.

Whatwasachieved Provided safe and effi cient port services.

HowtheCouncilPerformed Net surplus for the year was $54,000. WestportHarbour 100

2011/2012 2011/2012 2010/2011 WestportHarbour Actual Budget Actual $(000) $(000) $(000)

OPERATING REVENUE Fees and Sundry 208 0 720 TOTAL Revenue $208 $0 $720

OPERATING EXPENDITURE Employee Benefi t Expenses 0 0 124 Depreciation and Amortisation 154 0 462 Finance Costs 0 0 67 Other Expenses 0 0 235 TOTAL Expenditure $154 $0 $888

NET Cost/(Surplus) of Services $(54) $0 $168

Capital Expenditure - Renewals 0 0 0 Capital Expenditure - Increases in Levels of 000 Service CAPITAL EXPENDITURE $0 $0 $0

OperatingVariances Council did not budget for Westport Harbour.

Lease income $208,000) and depreciation on harbour asets ($154,000) were unbudgeted

SignificantCapitalExpenditure No capital expenditure was incurred.

ExplanationofSignificantCapitalExpenditureVariances No signifi cant capital variances were noted.

Buller District Council 101101

CouncilControlled TradingOrganisations WestportAirport Westport Airport is a joint venture between the Crown and Buller District Council, with each holding a 50% interest. Management and control of Westport Airport is vested in the Buller District Council.

Objective: • To operate as close as possible to a commercial business in a cost effective and effi cient manner. • To maintain the Westport Airport assets. • To enter into any commercial undertakings that will complement the airport operations. Nature&ScopeofActivities: To operate airport facilities at Westport. This includes the provision, maintenance, upgrading and enhancement of services and facilities to accommodate the landing of aircraft and the safe and effi cient facilitation of passengers and cargo, having regard to the regulatory requirements of the Civil Aviation Authority of New Zealand. PerformanceTargets&Results: Performance against the targets set in the Airport Authority’s Statement of Coprorate Intent is as follows: 2011/2012 2011/2012 2010/2011 WestportAirportAuthority-CouncilsHalfShare Actual Budget Actual $(000) $(000) $(000)

REVENUE Fees & Sundry - Airport 59 50 58 TOTAL Revenue $59 $50 $58

EXPENDITURE Employee Benefi t Expenses 2 12 5 Depreciation and Amortisation 54 55 54 Finance Costs 0 0 0 Other Expenses 61 48 53 $117 $115 $112 Less: Internal Interest 0 0 0 TOTAL Expenditure $117 $115 $112

NET Cost/(Surplus) of Services $58 $65 $54 Note: Council’s share of expenditure is not exactly half of total expenditure because of depreciation on different assets owned by each of the joint venture partners. CouncilControlledTradingOrganisations

Capital Expenditure - Renewals 51 0 9 Capital Expenditure - Increases in Levels of Service 0 0 0 CAPITAL EXPENDITURE $51 $0 $9 102

Non-FinancialPerformance&Targets: Acommitmenttotheenvironment • To comply with the Resource Management Act and undertake its activities in an environmentally sound manner having regard to the interest of the community.

Acommitmenttoservice • To systematically improve the quality and effectiveness of services provided to customers.

Acommitmenttothecommunity • To operate the airport with due regard to sound, cultural and environmental issues arising from the community in which they are located. • A commitment to full ownership and independent air transport. • To seek full contribution or divestment.

SignificantCapitalExpenditure No signifi cant capital expenditure were noted.

Buller District Council 103

BullerHoldingsLimited The nature and scope of Buller Holdings Limited is to provide a holding company structure for the ownership of selected Council assets and investments. Buller Holdings Limited provides a commercial focus in the govern- ance and administration of these assets, enabling more effective management of Council’s commercial activities therefore allowing for maximum returns on behalf of the ratepayers.

Objective To operate as a successful business and to be guided by the following principles: • Financial performance; • Service; • Employee relations; and • Safety and environment.

Nature&ScopeofActivities The nature and scope of Buller Holdings Limited is to provide a holding company structure for the ownership of selected Council assets and investments.

FinancialTargetsandResults Actual Budget Description 2011/2012 2011/2012 $000 $000 Group revenue 13,831 12,017 Net surplus 400 310 Return on revenue 2.9% 2.6% Dividends 825 825 Subvention Payment 276 0 104

ServicePerformance OBJECTIVE TARGET ACTUAL Financial Performance The company is committed to operate as a suc- Buller Holdings has continued to pursue all cessful business and achieve a commercial rate opportunities to increase revenue and con- of return on the investment in the business. This tain costs. The main focus was to look for will mean meeting the targets of subsidiaries as sustainable growth opportunities that reduce stated in the Statements of Intent. the reliance upon Council contracts Westreef has pursued this strategy and con- tinued to make good progress in obtaining competitively tendered works and in growing private customer works To actively pursue additional revenue streams re- Westport harbour has worked throughout the sulting in the increased profi tability of BHL so as year with the new customer Bathurst Re- to increase the dividend payable to Council. sources to develop a long term sustainable shipping business for West Coast coal and prospects for this opportunity are good. Buller Recreation uptake of services by cus- tomers continues to grow favourably but also needs to diversify in order to improve fi nan- cial performance. During the year a total of $825,000 (2011: $980,000) in distributions were paid to Coun- cil. This is in line with the Statement of In- tent which estimated a distribution to Coun- cil of $825,000. Service 3 meetings per year between Council and BHL 3 meetings held during the period with Direc- Board tors. CEO’s meet 6 times per year CEO’s have met 7 times during the period and three with the chairman present Formal monthly reporting to Council Quarterly reports to Council Compliance with charter and protocols No breaches of charter known

Buller District Council 105

WestReefServicesLimited WestReef Services Limited is 100% owned by Buller Holdings Limited.

Objective To operate as a successful business and to be guided by the following principles:

• Financial performance; • Service; and • Employee relations.

Nature&ScopeofActivities The nature and scope of WestReef Services Limited’s activities are to predominantly provide contracting services for physi- cal works in the Buller Region and the West Coast of the South Island. Its activities include maintenance and construction services for:

• Roads and bridges; • Response for road and civil defence emergencies; • Parks and reserves (including associated facilities); • Utility services (water and sewerage reticulation); • Rural fi re emergency response; • Vehicle workshop repairs; • Landfi ll sites; • Refuse collection and kerbside recycling; • Roadside vegetation control; and • Property maintenance.

PerformanceTargets&Results TARGET ACTUAL The Company will achieve a post tax operating profi t of 10.0% on • 12% achieved (2011: 20%) gross revenue (before any subvention payment) Grow gross revenue by 10% • 10% growth achieved in the period (2011: 22%) To renew its TQS1 certifi cation as required • Achieved Monthly meeting with major client and Council staff to obtain feed- • Achieved back on specifi c contract performance • In addition to client meetings direct contact from the public was used to gauge customer sat- isfaction. Support six activities involved with the social and environmental de- • Supported 18 events and organisations in the pe- velopment in the community. riod (2010: 15 events supported) Staff turnover to be less than 15% annually excluding retirement. • 16% achieved - 10 left, 24 started, 2 retired (2011: 23% achieved) Ensure succession plans are put in place for all senior management • Completed and implementation has com- positions. menced. Lost time incidents to be no more than 5% of total hours • 0.02% achieved (2011: 0.3% achieved) Held staff meetings to ensure effective communication with all staff • Meetings held weekly with minutes kept 106

WestportHarbourLimited Since 01 September 2005 the operation of the Westport Harbour and the management of the harbour assets have been carried out by Buller Port Services Limited, a wholly owned subsidiary of Holcim (New Zealand) Limited (“Holcim”) pursuant to a Harbour Management Agreement between the Council and Holcim dated 16 March 2006 (“the HMA”).

The term of the HMA expired on 31 August 2010 and with effect from the expiry of the HMA Westport Harbour Limited has operated the Harbour in accordance with agreed service levels. On 01 September 2010 Council sold land and buildings to Westport Harbour Limited and in consideration Buller Holdings Lim- ited issued 1,118,000 shares to Council with a par value of $1.00. The remainder of the port assets were leased to Westport Harbour Limited.

Objective To operate as a successful business and to be guided by the following principles:

• Financial performance; • Service; • Employee relations; and • Safety and environment.

Nature&ScopeofActivities Westport Harbour Limited will be involved in providing land, facilities, plant and labour for receiving, delivery, stockpiling and shipment of a wide range of products and raw materials; the ownership of land and facilities necessary to maintain the company’s commercial assets; and the provision of facilities associated with the repair and servicing of vessels

Buller District Council 107

KeyPerformanceIndicators

WHAT WE DID TARGET ACTUAL Financial perfor- Pre-tax operating profi t of at least 9% of gross revenue Pre-tax operating profi t for the year of mance -2.39% Target not achieved due to substantial dredge maintenance costs To achieve a post tax operating profi t of at least 15% of Defi cit for the year BHL’s investment before any subvention payments Pursue and demonstrate opportunities for practical Joint venture proposed with Bathurst to growth 2% operating profi t on BHL’s investments provide long term services Service To safely maintain by dredging (subject to prevailing 3.9m high, 2.4m low over the year weather and littoral draft conditions), a bar depth greater than 2.8 metres at chart datum Average depth of 3m

To achieve a maximum total tonnage of 460,000 tonnes 425,239mt of cement shipped through the port consistent with customers require- ments and vagarities of the port 6,400mt of coal shipped To safely maintain, by dredging, an average river depth Dredged as required to maintain depth in the main navigation channel of 3.8m at chart datum Average river depth of 4.0m

To maintain the cement berth depth to allow the Mil- burn Carrier II to lie always afl oat at a draft of at least 5.6m to 6.0m To maintain fl oating basin berth and Talleys wharf at 5m at chat datum- To maintain practical depths in fi shing vessel berths consistent with the size of working users so that they remain afl oat at MLW tides Provide forums for discussion on port related matters, During the year a lot of work has been conduct port tours and make presentations to prospec- undertaken to agree long term commer- tive and present customers cial arrangements with Bathurst Resourc- es Ltd There have also been a number of en- quiries for other shipping opportunities throughout the year which may result in business for the port Outport dredging contracts are still be- ing actively pursued with the Nelson contract for 2013 agreed and terms have been provided to Gisborne Employee Relations Achieve and maintain succession plans for the key staff Key position succession plans in place positions of Harbourmaster and Dredgemaster Staff turnover - 1 per year

Engage in policies that will assist in recruiting and re- Group Code of Conduct adopted by WHL taining staff during the year Achieve target training hours per employee of 0.5% of 286 hours achieved total work hours (114 hours) 108

WHAT WE DID TARGET ACTUAL Safety and Environ- Log all incidents from all sources and ensure that ap- 6 incidents for the year ment propriate action is taken to investigate, report and cor- rect identifi ed shortcomings LTI target is zero 2 LTI’s

LTIFR’s to be less than 4 per annum

Conduct 4 safety tours per month Average of 3.17 per month

Environment No adverse effects on the environment All consents requirements met

Oil spill training and procedures in place

Buller District Council 109

BullerRecreationLimited Council incorporated a new Council Controlled Organisation, Buller Recreation Limited, which is 100% owned by Buller Holdings Limited. In the Council meeting held on 24 June 2009, Council agreed to transfer the Solid Energy Centre to Buller Recreation Limited, and Westport Harbour to Westport Harbour Limited effective 01 July 2009.

In the meeting of 23 September 2009 Council ratifi ed the purchase and sale documents for the sale of the assets to Buller Recreation Limited. The sale was concluded and Council received 17,570 million shares in Buller Holdings Limited, valued at $17.570 million, and transferred the assets to Buller Recreation Limited.

Objective To operate as a successful business and to be guided by the following principles:

• Financial performance; • Service; • Employee relations; and

• Safety and environment.

Nature&ScopeofActivities The nature and scope of the company’s activities are to provide accessible sport, recreation and event services and facilities to residents and visitors to the Buller District of New Zealand. Its activities will include provision of services for: • Recreational swimming and learn to swim programmes • Aquatic sports events • Indoor court sports competitions and events

• Fitness centre programmes and classes

• Outdoor turf sports

• Corporate, trade and social events

The Directors will consider opportunities from time to time with regard to other types of activities or expanding the reach of the Buller Recreation Limited for the provision of services outside of the centre’s physical location. 110

KeyPerformanceIndicators WHAT WE DID TARGET ACTUAL Financial perfor- To operate within budget Revenue exceeds budget by 9% mance Expenditure exceeds budget by 4.5% Buller Recreation continues to be a diffi cult business to operate, ending the year with a pre- tax loss of $730,000 The company has reached the point where ex- penditure controls are strong, but future suc- cesses will depend upon the ability to generate further revenue Achieve fi tness centre membership of circa 320pa Membership currently at 516 with a retention rate of more than 35% Average membership is 318 Retention rate of memberships is 70% Achieve regular patronage of aquatic services to Achieved average of 4,880 an average of 2,800 visits per month Achieve swimming lesson students in programmes Averaged 179 per month of circa 125 students (averaged over 12 months) Ensuring compliance with legislation and industry Achieved best practice in health and safety management Employee leader- Engage in policies that will assist in developing Staff turnover 29% (7 staff out of 25) ship, development and retaining staff and retention One of these is a retiree Staff turnover to be less than 15% annually Establishing a structure of leadership and succes- Structure developed and implemented sion that enables delivery of service objectives Leader structure and succession plans developed Development of a training plan for staff Staff training has been undertaken to ensure that they have the necessary skills to perform the tasks they are required to do Customer service and management training has been given to some members of staff during this period Fortnightly team leader meetings to be held and Achieved minuted Asset management plans developed for the facil- Asset management plans completed in 2011 ity, plant and equipment Complete maintenance and replacement in ac- Achieved cordance with the asset management plan Monthly report on asset management

Buller District Council 111

BullerHealthTrust The Buller Health Trust was established in 1997 for the preservation of public health and wellbeing in the Buller District. The Mayor and Chief Executive are appointed trustees of the Buller Health Trust.

Objective • To benefi t the community; • To be a good employer; and • To be environmentally and socially responsible.

Nature&ScopeofActivities To be involved in establishing, maintaining, controlling, aiding or carrying on medical and dental clinics or any other body in accordance with the Trust Deed, with the objective on conserving public health and wellbeing in the community of the Buller District.

PerformanceTargets&Results TARGET ACTUAL To support provision of appropriate medical Dental services were available 100% of the year (2011: 100%) services to the Buller community. To operate on a breakeven basis Annual result was a $102,845 surplus (2011: $23,255 loss) 112

TourismWestCoast Tourism West Coast is the official Regional Tourism Organisation for the West Coast region. The Board of Directors is made up of five members. The Buller District Council appoints one member, along with the one each from Westland District Council and Grey District Council. The Council also provides annual funding to Tourism West Coast. The other two members are appointed by Development West Coast and from the Tourism industry.

Objective • Enhance the West Coast’s basic promotional capabilities; • Co-ordinate the work of development and promotional agencies; • Secure long term funding; and • Provide advisory and support services for the local tourism industry.

Nature&ScopeofActivities Tourism promotion at a regional level.

PerformanceTargets&Results

TARGET ACTUAL The Chairperson of the Board and Chief Presentation completed to Council during Annual Plan process. Executive of Tourism West Coast will ad- dress Council on an annual basis The Annual Report is to be presented to Annual Report provided and adopted by Council on 25 July 2012 Council within two months of adoption

Buller District Council 113113

Financial Statements

Contains:

 StatementofComprehensiveIncome  StatementofChangesinEquity  StatementofFinancialPosition  StatementofCashflows FinancialStatements 114114 StatementofComprehensiveIncome Parent Group

2011/2012 2011/2012 2010/2011 2011/2012 2010/2011 For the year ended Note Actual Budget Actual Actual Actual 30 June 2012 $000 $000 $000 $000 $000 OPERATING REVENUE General Rates 1 6,835 6,790 6,411 6,835 6,411 Targeted Rates 1 4,486 4,538 4,068 4,486 4,068 Rate Penalties 1 231 170 231 231 231 Financial Assistance 5,162 5,014 3,892 5,162 3,892 Investment Income 2 1,764 1,444 1,610 612 640 Other Income 2 159 0 167 2 167 Fees & Charges 4,420 3,505 4,443 9,435 8,228 Vested Assets 122 350 40 122 40 Profi t on Sale of Assets 6 0 384 35 0 Revaluations of Investment Land 12 532 390 141 532 141 Share in Profi t/(Loss) of Associate 0 0 0 (1) (8) TOTAL Operating Revenue 3 $23,717 $22,201 $21,387 $27,451 $23,810

OPERATING EXPENDITURE Employee Benefi t Expense 4,015 3,892 4,003 9,110 8,157 Depreciation 5,015 4,803 5,199 6,118 6,222 Finance Costs 1,219 1,490 1,512 1,217 1,446 Other Expenses 12,509 10,428 11,443 10,328 9,866 Loss on Derivative Contracts 16 259 0 208 259 208 Impairment of Assets 12 679 0 1,400 744 0 Assets Written Off 461 0 572 461 572 Loss on Sale of Assets 9 0 0 9 127 Loss on Sale of Investment Property 52 0 194 52 194 TOTAL Operating Expenditure 4 $24,218 $20,613 $24,531 $28,298 $26,792

NET Surplus (Defi cit) Before Taxation 5 $(501) $1,588 $(3,144) $(847) $(2,982)

Income Tax Expense 6 0 0 0 97 77

(501) 1,588 (3,144) (421) (3,059) NET Surplus (Defi cit) After Taxation $(501) $1,588 $(3,144) $(944) $(3,059)

OTHER COMPREHENSIVE INCOME

Increase /(Decrease) in Infrastructure 13,823 4,596 130 14,345 130 Revaluation Reserves

Gain/(Loss) on Investment Recognised in (11) 0 (8) (11) (8) Asset Revaluation Reserve

TOTAL Comprehensive Income $13,311 $6,184 $(3,022) $13,390 $(2,937)

Buller District Council The accompanying Notes form part of these Financial Statements 115115 StatementofChangesinEquity Parent Group

2011/2012 2011/2012 2010/2011 2011/2012 2010/2011 For the year ended Actual Budget Actual Actual Actual 30 June 2012 $000 $000 $000 $000 $000 Equity as at 1 July $295,510 $321,240 $298,532 $293,695 $296,632 Total Comprehensive Income 13,311 6,184 (3,022) 13,390 (2,937) Transactions with Owners recorded 0 0000 directly in Equity Total Equity at End of Year $308,821 $327,424 $295,510 $307,085 $293,695

Components of Equity Accumulated Funds 171,516 187,271 171,948 169,099 169,974 Reserves 1,872 739 1,941 1,872 1,941 Asset Revaluation Reserve 135,433 139,414 121,621 136,114 121,780 Total Equity at End of Year $308,821 $327,424 $295,510 $307,085 $293,695

The accompanying Notes form part of these Financial Statements 116116 StatementofFinancialPosition Parent Group

2011/2012 2011/2012 2010/2011 2011/2012 2010/2011 As at Note Actual Budget Actual Actual Actual 30 June 2012 $000 $000 $000 $000 $000 CURRENT ASSETS Cash and Cash Equivalents 8 1,986 628 506 2,560 1,818 Trade and Other Receivables 9 4,645 3,746 4,259 4,708 4,334 Tax Receivable 0 100 0 0 0 Inventories 16 13 16 188 171 Other Current Assets 10 9 9 237 44 297 Short Term Investments 10,938 10,764 10,376 12,241 11,229 Assets Held for Sale 11 415 0 1,536 415 1,536 TOTAL Current Assets $18,009 $15,260 $16,930 $20,156 $19,385

NON CURRENT ASSETS Investments 12 20,149 24,744 20,509 198 199 Investment Property 12 11,410 16,124 12,003 11,410 12,003 Infrastructural Assets 13 269,692 285,236 257,185 269,692 256,891 Other Non Current Assets 13 19,683 22,557 18,707 36,458 36,644 Intangible Assets 14 140 68 85 882 819 TOTAL Non Current Assets $321,074 $348,729 $308,489 $318,640 $306,556

TOTAL Assets $339,083 $363,989 $325,419 $338,796 $325,941

Buller District Council The accompanying Notes form part of these Financial Statements 117117

Parent Group

2011/2012 2011/2012 2010/2011 2011/2012 2010/2011 As at Note Actual Budget Actual Actual Actual 30 June 2012 $000 $000 $000 $000 $000 CURRENT LIABILITIES Cash and Cash Equivalents 8 0 0 216 0 216 Trade and Other Payables 15 4,051 4,978 3,702 3,379 4,052 Derivative Financial Instruments 16 0 50000 Employee Benefi ts 17 468 403 437 1,063 947 Provisions 19 33 0 51 33 51 Current Portion of Term Debt 18 0 1,338000 TOTAL Current Liabilities $4,552 $6,769 $4,406 $4,475 $5,266

NON CURRENT LIABILITIES Derivative Financial Instruments 16 902 0 643 902 643 Provisions 19 1,503 1,372 1,593 1,503 1,593 Bond Deposits 82 82 82 82 82 Employee Benefi ts 17 199 109 161 303 314 Deferred Tax 6 0 0 0 1,422 1,324 Term Debt 18 23,024 28,233 23,024 23,024 23,024 TOTAL Non Current Liabilities $25,710 $29,796 $25,503 $27,236 $26,980

EQUITY Accumulated Funds 20 171,516 187,271 171,948 169,099 169,974 Reserves 21 1,872 739 1,941 1,872 1,941 Asset Revaluation Reserve 22 135,433 139,414 121,621 136,114 121,780 TOTAL Equity $308,821 $327,424 $295,510 $307,085 $293,695

TOTAL LIABILITIES & EQUITY $339,083 $363,989 $325,419 $338,796 $325,941

The accompanying Notes form part of these Financial Statements 118118 StatementofCashflows Parent Group

2011/2012 2011/2012 2010/2011 2011/2012 2010/2011 For the year ended Note Actual Budget Actual Actual Actual 30 June 2012 $000 $000 $000 $000 $000 CASHFLOWS FROM OPERATING ACTIVITIES Cash was provided from: Rates 11,695 11,498 10,764 11,666 10,764 Other Income 9,089 8,519 8,707 13,948 12,372 Interest Received 680 619 599 629 540 Tax Received 0 0 0 1 238 Dividends Received 825 825 980 0 0 22,289 21,461 21,050 26,244 23,914 Cash was applied to: Payments to Suppliers & Employers 15,024 13,363 16,042 18,581 18,059 Interest Paid 1,328 1,490 1,334 1,325 1,334 Income Tax Paid 0 0 0 0 0 Net GST Movement 408 0 76 443 35 16,760 14,853 17,452 20,349 19,428

Net Cash From Operating Activities 7 $5,529 $6,608 $3,598 $5,895 $4,486

CASHFLOWS FROM INVESTING ACTIVITIES Cash was provided from: Disposal of Fixed Assets 2,210 0 2,779 2,283 1,750 Investment Realised 10,376 439 0 11,229 50 Transfer of Cash from Assets Held (0) 0 0 0 0 for Sale 12,585 439 2,779 13,512 1,800 Cash was applied to: Purchase of Fixed Assets 5,096 10,207 5,919 5,718 6,534 Purchase of Investments 11,190 0 1,703 12,586 1,158 Purchase of Intangibles 133 0 94 145 94 Transfer of Cash to Assets held for 00000 sale 16,419 10,207 7,716 18,449 7,786

Net Cash From Investing Activities $(3,834) $(9,768) $(4,937) $(4,937) $(5,986)

Buller District Council The accompanying Notes form part of these Financial Statements 119119  Parent Group

2011/2012 2011/2012 2010/2011 2011/2012 2010/2011 For the year ended Note Actual Budget Actual Actual Actual 30 June 2012 $000 $000 $000 $000 $000 CASHFLOWS FROM FINANCING ACTIVITIES Cash was provided from: Loans Raised 0 4,530 750 0 750

Cash was applied to: Repayment of loans 0 260 0 0 0

Net Cash From Financing Activities $0 $4,270 $750 $(0) $750

NET INCREASE (DECREASE) IN CASH $1,696 $1,110 $(589) $958 $(750)

OPENING CASH AS AT 1 JULY $290 $(481) $879 $1,602 $2,352

CLOSING CASH AS AT 30 JUNE $1,986 $628 $290 $2,560 $1,602

The accompanying Notes form part of these Financial Statements Buller District Council 121121 Notestothe FinancialStatements Contains:

 Note1 RatesRevenue  Note2 InvestmentIncome  Note3 OperatingRevenue  Note4 OperatingExpenditure  Note5 OperatingSurplus  Note6 IncomeTax  Note7 ReconciliationofNetSurplusafterTaxtoCashflowsfromOperatingActivities  Note8 Cash&CashEquivalents  Note9 TradeandOtherReceivables  Note10 OtherCurrentAssets  Note11 NonCurrentAssetsheldforsale  Note12 Investments  Note13 Property,PlantandEquipment  Note14 IntangibleAssets  Note15 Trade&OtherPayables  Note16 DerivativeFinancialInstrument  Note17 EmploymentBenefitLiabilities  Note18 Borrowings  Note19 Provisions  Note20 AccumulatedFunds  Note21 Reserves  Note22 AssetRevaluationReserves  Note23 RelatedPartyTransactionsandBalances  Note24 StatementofFinancialInvolvementsinCCTOs&OtherCompaniesorOrganisations NotestotheFinancialStatements  Note25 StatementofCommittments,ContingentLiabilities&ContingentAssets  Note26 CapitalManagement  Note27 FinancialInstruments  Note28 PostBalanceDateEvents  Note29 ExplanationofMajorVariancesagainstBudget 122122 Note1~RatesRevenue

RatesRevenue Parent

Actual Actual 2011/2012 2010/2011 $000 $000

General Rates $6,835 $6,411

Targeted Rates Attributable to Activities: Water 1,538 1,353 Refuse and Sanitation 2,633 2,449 Roading 47 39 Economic Development 268 227 Penalties 231 231 TOTAL Revenue from rates $11,552 $10,710

RatesRemissions Rates revenue is shown net of rates remissions, BDC’s rates remission policy allows BDC to remit rates on sporting, culture and other community organisations.

Parent

Actual Actual 2011/2012 2010/2011 $000 $000

TOTAL Rates Revenue $11,598 $10,752

Rates Remissions: Land used for sport 29 27 Land protected for historical or cultural purposes 17 15 TOTAL Remissions $46 $42

Rates Revenue Net of Remissions $11,552 $10,710

Buller District Council 123123 Note2~InvestmentIncome

Parent Group

Actual Actual Actual Actual 2011/2012 2010/2011 2011/2012 2010/2011 $000 $000 $000 $000

Interest 1,313 1,335 1,262 1,345 Dividend Income 1,101 980 0 0

2,414 2,315 1,262 1,345

Less: Internal Interest 650 705 650 705

TOTAL Investment Income $1,764 $1,610 $612 $640

Parent Group

Actual Actual Actual Actual OTHER INCOME 2011/2012 2010/2011 2011/2012 2010/2011 $000 $000 $000 $000

Investment Loan Discount Amortisation Revenue 69 2 2 2 Sundry Income 90 165 0 165

TOTAL Other Income $159 $167 $2 $167 124124 Note3~OperatingRevenue

Parent Group

2011/2012 2011/2012 2010/2011 2011/2012 2010/2011 REVENUE BY ACTIVITY Actual Budget Actual Actual Actual $000 $000 $000 $000 $000

Democracy 0 10 44 0 44 Community Services 2,379 1,369 1,468 2,379 1,468 Environmental Services 1,336 811 1,098 1,336 1,098 Amenities & Reserves 1,471 1,104 1,533 1,471 1,533 Roading & Urban Development 2,988 3,261 3,154 2,988 3,154 Solid Waste 1,460 1,497 1,242 1,460 1,242 Water Supplies 2,435 3,158 1,568 2,435 1,568 Wastewater and Stormwater 1,983 2,146 1,818 1,983 1,818 Harbour 208 0 720 208 720 Airport 59 50 58 59 58 In House Professional Services 615 662 605 615 605 Support Services 3,633 3,497 3,489 3,633 3,489 $18,567 $17,565 $16,797 $18,567 $16,797

PLUS: General Rates 6,835 6,790 6,411 6,835 6,411 Rates Penalties 231 170 231 231 231 Investment Income 1,764 619 1,610 612 640 Profi t on Sale of Assets 6 0 384 35 0 Vested Assets 122 350 40 122 40 Sundry Income 159 825 167 2 167 Revaluations of Investment Land 532 390 141 532 141 Group Income 0 0 0 5,014 3,785 Share in Profi t/(Loss) of Associate 0 0 0 (1) (8) $28,217 $26,709 $25,781 $31,951 $28,204

LESS: Internal Recoveries (4,500) (4,508) (4,394) (4,500) (4,394)

TOTAL Income $23,717 $22,201 $21,387 $27,451 $23,810

Buller District Council 125125 Note4~OperatingExpenditure

Parent Group

2011/2012 2011/2012 2010/2011 2011/2012 2010/2011 EXPENDITURE BY ACTIVITY Actual Budget Actual Actual Actual $000 $000 $000 $000 $000

Democracy 814 795 845 814 845 Community Services 5,436 4,453 4,537 5,436 4,537 Environmental Services 2,295 2,071 2,054 2,295 2,054 Amenities & Reserves 2,788 2,098 2,492 2,788 2,492 Roading & Urban Development 6,037 6,054 5,882 6,037 5,882 Solid Waste 1,877 1,943 2,033 1,877 2,033 Water Supplies 1,747 1,725 1,851 1,747 1,851 Wastewater and Stormwater 2,509 2,495 2,507 2,509 2,507 Harbour 154 0 888 154 888 Airport 117 115 112 117 112 In House Professional Services 532 583 565 532 565 Support Services 3,602 3,497 3,489 3,602 3,489 $27,908 $25,828 $27,255 $27,908 $27,255

PLUS: Group Expenses 0 0 0 4,015 3,534 Assets Written Off 461 0 572 461 572 Loss on Derivative Contracts 259 0 208 259 208 Impairment of Assets 679 0 1,400 744 0 Loss on Sale of Assets 9 0 0 9 127 Loss on Sale of Investment Property 52 0 194 52 194

LESS: Internal Recoveries (4,500) (4,507) (4,394) (4,500) (4,394) Internal Interest (650) (708) (704) (650) (704)

TOTAL Expenditure $24,218 $20,613 $24,531 $28,298 $26,792 126126 Note5~OperatingSurplus

Parent Group

Actual Actual Actual Actual OPERATING SURPLUS WAS DETERMINED AFTER ACCOUNTING FOR: 2011/2012 2010/2011 2011/2012 2010/2011 $000 $000 $000 $000

Fees to principal auditor: Audit fees for fi nancial statement audit 98 96 198 187 Audit fees for long term plan audit 72 0 72 0 Additional audit fees (cost recoveries long term plan) 17 10 17 10 Additional audit fees (1/2 share WAA) 4 2 4 2

Grants and Donations Expense 491 594 491 594 Lease Income 357 359 88 119 Lease Expense 147 157 170 183 Movement in provision doubtful debts: Accounts Receivable (58) 10 (58) 10

Buller District Council 127127

(i)Remuneration During the year to 30 June 2012, the total remuneration and value of non-fi nancial benefi ts received by or payable to the Mayor, other Councillors and the Chief Executive of the Council were as follows:

Actual Actual 2011/2012 2010/2011 $$

Chief Executive: Gary Murphy (resigned 27 Jul-11) 32,525 180,905 Paul Wylie (commenced 05 Dec-11) 125,300 0 Craig Scanlon (Acting CEO 27 Jul-11 to 30 Sep-11) 34,977 0 Angela Oosthuizen (Acting CEO 03 Oct-11 to 02 30,753 0 Dec-11)

$223,555 $180,905

Mayor: Pat McManus $64,713 $60,446

Councillors: Katherine Bainbridge (until 09 Oct-10) 0 4,214 David Barnes 18,171 14,899 Peter Campbell 13,091 14,038 Jim Halsall 13,091 14,028 Dave Hawes 13,091 14,034 John Hill (from 09 Oct-10) 13,091 9,656 Graham Howard (from 09 Oct-10) 13,091 9,656 Margaret Montgomery 16,145 16,025 Graeme Neylon 13,091 14,034 Fred Ratahi 13,091 14,028 Lynley Roberts (until 09 Oct-10) 0 4,214 Rosalie Sampson 18,019 19,169

$208,685 $208,441

(ii)SeverancePayments During the year no severance payments were made to staff (2011: two severance payments of $36,087 and $14,028 totaling $50,112 were made). 128128 Note6~IncomeTax

Parent Group

Actual Actual Actual Actual 2011/2012 2010/2011 2011/2012 2010/2011 $000 $000 $000 $000

Components of Tax Expense Current Tax Expenses 0000 Adjustments to Current Tax in Prior Year 0000 Deferred Tax Expenses 0 0 97 77 Income Tax Expense $0 $0 $97 $77

Parent Group

Actual Actual Actual Actual 2011/2012 2010/2011 2011/2012 2010/2011 $000 $000 $000 $000

Relationship Between Tax and Accounting Profi t Surplus/(Defi cit) Before Tax (501) (3,144) (847) (2,892) Tax @ 28% (2011: 30%) (140) (943) (237) (895) Non-Deductible Expenditure 21 0 279 967 Non-Taxable Income 0 811 0 0 Change in Building Depreciation 0000 Effect of tax rate change 0 (2) 0 5 Prior Year Adjustment 0000 Group Loss Offset 77 0 0 0 Temporary Differences Not Recognised 55 8 0 0 Tax Losses Not Recognised (13) 126 0 0 Deferred Tax Adjustments 0 0 55 0 Tax Expense $(0) $0 $97 $77

Buller District Council 129129

DeferredTaxAssets/(Liabilities) Parent Property, Financial Employee Other Tax Losses Total Plant & Instruments Entitlements Provisions Equipment Balance at 1 July 2010 0 0 0 0 0 0 Charged to Profi t & Loss 0 0 0 0 0 0 Balance at 1 July 2011 $0 $0 $0 $0 $0 $0

Charged to Profi t & Loss 0 0 0 0 0 0 Charged to Equity 0 0 0 0 0 0 Balance at 1 July 2012 $0 $0 $0 $0 $0 $0

Group Property, Financial Employee Other Tax Losses Total Plant & Instruments Entitlements Provisions Equipment Balance at 1 July 2010 (2,063) 0 180 25 608 (1,247) Charged to Profi t & Loss (104) 7 (9) 32 (77) Balance at 1 July 2011 $(2,167) $0 $187 $16 $640 $(1,324)

Charged to Profi t & Loss (43) 0 (12) 4 (46) (97) Charged to Equity 0 0 0 0 0 0 Balance at 1 July 2012 $(2,210) $0 $175 $20 $594 $(1,421)

Additionaldisclosures 2012: Council has an unrecognised deferred tax asset in relation to temporary timing differences of $91,132 (2011: $289,025) and tax losses of $2,120,244 (2011: $2,167,059). This deferred tax asset has been recognised at the group level. 130130

Note7~ ReconciliationofNetSurplusafterTaxto CashflowsfromOperatingActivities

Parent Group

2011/2012 2010/2011 2011/2012 2010/2011 $000 $000 $000 $000

Surplus/(Defi cit) after Tax (501) (3,144) (944) (3,059) Add/(less) non-cash items: Depreciation Expense 5,015 5,199 6,118 6,222 Impairment 679 1,400 744 - Movement in Provisions (108) 58 (108) 58 Movement in Deferred Taxation - - 98 128 Write down of Suspensory Loan - 67 - - Other Non Cash Items - - 425 - Vested Assets (122) (40) (122) (40) Loan Amortisation (69) (2) (2) (2) (Gains)/Losses in Fair Value of Investment Property (532) (141) (532) (141) (Gains)/Losses on Derivative Financial Instruments 259 208 259 208 5,122 6,749 6,880 6,433 Add/(less) Items Classifi ed as Investing Activities: (Gains)/Losses on Disposal of Investment Property 52 (190) 26 321 & PPE Assets Written Off 463 572 461 572 Movement in fi xed asset accounts receivable - 300 - - Movement in fi xed asset prepayment 230 230 230 - Transfer of Working Capital on Sale - (460) - - Movement in Fixed Asset Accounts Payable (98) 629 (52) 597 647 1,081 665 1,490 Add/(less) Movements in Working Capital Items: Trade and Other Receivables (386) (228) (374) (232) Inventories (0) 116 (17) 61 Other Current Assets 228 (216) 253 (261) Trade and Other Payables 349 (724) (673) (326) Income Tax Receivable - - - 238 Employee Benefi ts 69 (36) 105 142 261 (1,088) (706) (378)

Net Cash Infl ow/(Outfl ow) from Operating Activities $5,529 $3,598 $5,895 $4,486

Buller District Council 131131 Note8~Cash&CashEquivalents

Parent Group

Actual Actual Actual Actual 2011/2012 2010/2011 2011/2012 2010/2011 $000 $000 $000 $000

Cash at bank and in hand 1,986 506 2,560 1,818 Short term deposits maturing three months or less from 0000 the date of acquisition Total cash and cash equivalents $1,986 $506 $2,560 $1,818

The carrying value of short-term deposits with maturity dates of three months or less approximates their fair value.

Cash&bankoverdraftsincludethefollowingforthepurposesoftheCashflowStatement: Parent Group

Actual Actual Actual Actual 2011/2012 2010/2011 2011/2012 2010/2011 $000 $000 $000 $000

Cash at bank and in hand 1,986 506 2,560 1,818 Short term bank deposits maturing within three months 0 0 0 0 Bank overdrafts 0 (216) 0 (216) $1,986 $290 $2,560 $1,602 132132 Note9~Trade&OtherReceivables

Parent Group

Actual Actual Actual Actual 2011/2012 2010/2011 2011/2012 2010/2011 $000 $000 $000 $000

Trade Receivables $2,337 $1,693 $2,935 $2,323 Amounts Due from Controlled Entities (excluding GST) WestReef Ltd 71 67 0 0 Buller Holdings Ltd 88 88 0 0 Buller Recreation Ltd 16 16 0 0 Buller Arts and Recreation Trust 0 0 0 0 Buller Health Trust 2 99 0 0 Westport Harbour Ltd 82 374 0 0

NZTA 576 638 576 638 Interest Receivable 67 83 67 83 Subvention Receivable 276 0 0 3 Rates Receivable 1,206 1,334 1,206 1,334 $4,721 $4,393 $4,784 $4,378

Less: Provisions for Doubtful Debts (76) (134) (76) (44) $4,645 $4,259 $4,708 $4,334

Represented By; Current Portion 4,645 4,259 4,708 4,334 Term Portion 0 0 0 0

FairValue Trade and other receivables are non-interest bearing and receipt is normally on 30 day terms. The carrying value of trade, and other receivables (excluding loans to related parties and community loans) approximates their fair value.

Impairment There is no concentration of credit risk with respect to receivables outside the group, as the group has a large number of customers. Buller District Council does not provide for any impairment on rates receivables as it has various powers under the Local Government (Rating) Act 2002 to recover any outstanding debts. Ratepayers can apply for payment plan options in special circumstances. Where such payment plans are in place debts are discounted to the present value of future repayments. These powers allow Council to commence legal proceedings to recover any rates that remain unpaid four months after the due date for payment. If payment has not been made within 3 months of the Court’s judgement, then Council can apply to the Registrar of the High Court to have the judgement enforced by sale of lease or the rating unit.

Buller District Council 133133

2011/2012 2010/2011

Gross Impairment Net Gross Impairment Net $000 $000 $000 $000 $000 $000

Council Not past due 3,301 0 3,301 2,843 0 2,843 Past due 1-60 days 352 0 352 358 0 358 Past due 61-120 days 20 0 20 113 0 113 Past due > 120 days 1,048 76 972 1,079 134 945 TOTAL $4,721 $76 $4,645 $4,393 $134 $4,259

Group Not past due 3,255 0 3,255 2,748 0 2,748 Past due 1-60 days 443 0 443 425 0 425 Past due 61-120 days 38 0 38 126 0 126 Past due > 120 days 1,048 76 972 1,079 44 1,035 TOTAL $4,784 $76 $4,708 $4,378 $44 $4,334

The doubtful debt provision has been calculated based on expected losses for Council’s pool of debtors. Expected losses have been determined based on an analysis of Council’s losses in previous periods, and review of specifi c debtors as detailed below:

2011/2012 2010/2011 2011/2012 2010/2011 $000 $000 $000 $000 Individual Impairment 76 134 76 44 Collective Impairment 0 0 0 0 Total Provision for Impairment $76 $134 $76 $44 134134

Individually impaired receivables have been determined to be impaired because of the signifi cant fi nancial diffi culties being experienced by the debtor. An analysis of these individually impaired debtors are as follows: Parent Group

2011/2012 2010/2011 2011/2012 2010/2011 $000 $000 $000 $000

Past Due 1-60 days 0 0 0 0 Past due 61-120 days 0 0 0 0 Past due > 120 days 76 134 76 44 Total Individual Impairment $76 $134 $76 $44

Movement in the provision for impairment of receivables are as follows: Parent Group

2011/2012 2010/2011 2011/2012 2010/2011 $000 $000 $000 $000

At 1 July 134 124 44 124 Additional provisions made during the year 32 44 32 44 Provisions reversed during the year (90) (34) 0 (124) Receivables written-off during the period 0 0 0 0 At 30 June $76 $134 $76 $44

Buller District Council holds no collateral as security or other credit enhancements over receivables that are either past due or impaired.

Buller District Council 135135 Note10~OtherCurrentAssets

Parent Group

Actual Actual Actual Actual 2011/2012 2010/2011 2011/2012 2010/2011 $$$$

Work In Progress 3386 Prepayments 6 234 36 291 $9 $237 $44 $297 136136 Note11~NonCurrentAssetsheldforSale

As at 30 June 2012 the assets held for sale, being surplus to requirements are listed below (2011: Council had investment land and an item of plant and equipment for sale).

Parent Group

Actual Actual Actual Actual 2011/2012 2010/2011 2011/2012 2010/2011 $000 $000 $000 $000 Non-current assets held for sale are; Investment Land 379 1,500 379 1,500 Westport Transfer Station Portable Weighbridge 36 36 36 36 Total Assets Held for Sale $415 $1,536 $415 $1,536

Buller District Council 137137 Note12~Investments

Parent Group

Actual Actual Actual Actual 2011/2012 2010/2011 2011/2012 2010/2011 $000 $000 $000 $000

Buller Holdings Ltd 16,909 17,288 0 0 Loans and Receivables 3,129 3,110 0 0 Other Share Investments 31 31 31 32 Investment in Associate 0 0 87 87 Bond Deposits 80 80 80 80 $20,149 $20,509 $198 $199

On 22 August Council exchanged an advance of $300,000 made to Buller Holdings Limited for a consideration of $300,000 shares capital.

(2011: On 1 September Council sold land to Westport Harbour Limited and in consideration Buller Holdings Limited issued 1,118,000 shares to Council with a par value of $1. The assets were sold at market value with the valuation carried out by Quotable Value New Zealand.)

In 2012 Buller District Council investment in Buller Holdings Limited was impared by $679,000 due to an additional writedown in the value of Buller Holdings’ investment in Buller Recreation Limited assets.

(2011: Buller District Council investment in Buller Holdings Limited was impaired by $1,400,000 due to the write down in the value of Buller Holdings’ investment in Buller Recreation Limited assets.)

2011/2012 2010/2011 $000 $000

Investments acquired - Shares issued by Buller Holdings Limited 300 1,118 Investments acquired - Advances and Loans (300) 300 $0 $1,418 Consideration paid: Property, Plant and Equipment transferred at cost 0 876 Gain on Sale recognised in Surplus 0 542 $0 $1,418

All loans to Council Controlled Organisations have been advanced at market interest rates (2011: Section 63 of the Local Gov- ernment Act states that a Local Authority must not lend money or provide any other fi nancial accommodation to a CCTO on terms and conditions more favourable to a CCTO than those that would apply if the Local Authority was borrowing the money.

In 2011 the District Council has lent money to Westport Harbour Limited at an interest rate of 2% pa. This rate is considered to be more favourable than the rate that the Distrit Council could have obtained when borrowing money. This is a breach of Section 63 of the Local Government Act 2002).

From 1 July 2011 Council has charged a market-based interest rate for funds advanced to Westport Harbour Limited. 138138

Parent Group InvestmentProperty Actual Actual Actual Actual 2011/2012 2010/2011 2011/2012 2010/2011 $000 $000 $000 $000

Balance at 1 July $12,003 $15,328 $12,003 $15,328

Transfers (279) (1,500) (279) (1,500) Disposals/Adjustments (846) (1,966) (846) (1,966) Fair value gains/(losses) on valuation 532 141 532 141 Balance 30 June $11,410 $12,003 $11,410 $12,003

Parent Group

InvestmentProperty-Income&Expenses Actual Actual Actual Actual 2011/2012 2010/2011 2011/2012 2010/2011 $000 $000 $000 $000

Rental Income from Investment Property 87 126 87 126 Direct Expenses of Income Generating Investment Property 0000 Direct Expenses of Non-income Generating Investment Prop- 0000 erty

Buller District Council investment properties are valued annually at fair value efective 30 June. All investment properties were valued based on open market evidence in July 2012. The valuation was performed by Darroch Valuations, an independent valuer. Darroch.

As at 30 June 2012 there were a total of 5 leasehold properties with a sale value of $379,050 lodged at Council’s solicitors pending completion of sale, these are disclosed in note 11. (2011; 23 properties total sale value $1,480,800).

The fair value of loans to related parties is $3,129,017 (2011: $3,607,281). Fair value has been determined using cash fl ows discounted at a rate based on market interest rates including an additional risk to take into account the specifi c risks of each loan. The interest rate on the loan of $2,363,860 to Buller Holdings Ltd is 3.73%. The interest rate on the loan of $200,000 to Westport Harbour Ltd is 4.03%. Weighted average of low interest loans to community organisations is 4.5%.

Buller District Council 139139 Note13~Property,Plant&Equipment Amount Amount Amount Amount Carrying Carrying 30-06-12 30-06-12 on on Ɵ Ɵ 30-06-12 30-06-12 Deprecia Deprecia Accumulated Accumulated Accumulated Accumulated on on on on Ɵ Ɵ Cost/ Cost/ 30-06-12 30-06-12 Revalua Revalua on on Ɵ Ɵ Gains Gains Revalua Revalua Others Others Transfers/ Transfers/ on on Ɵ Ɵ Current Year Year Current Current Year Year Current Deprecia Deprecia on on Ɵ Ɵ on Disposals on Disposals Deprecia Deprecia Accumulated Accumulated Accumulated Accumulated for Sale for for Sale for Transfer Transfer Transfer Transfer (to)/from (to)/from (to)/from (to)/from Assets Held Assets Assets Held Assets Charges Charges Disposals / Disposals / Impairment Impairment Impairment Impairment Current Year Year Current Current Year Year Current on on Ɵ Ɵ Year Year year year Current Current Current Current Addi Addi Amount Amount Amount Amount Carrying Carrying 01-07-11 01-07-11 on on Ɵ Ɵ Deprecia Deprecia Accumulated Accumulated Accumulated Accumulated o n o n Ɵ Ɵ $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 1,574 (1,316) 258 82 (1) 0 1 (69) 0 0 1,655 (1,384) 271 01-07-11 01-07-11 $30,433 $(11,726) $18,707 $1,435 $(211) $0 $98 $(966) $620 $0 $32,277 $(12,594) $19,684 $261,928 $(4,743) $257,183 $3,626 $(351) $0 $0 $(3,972) $(620) $13,822 $270,722 $(1,031) $269,692 Revalua Revalua lls/Transfer Stns lls/Transfer 1,860 (339) 1,521 0 0 0 0 (87) 0 0 1,860 (426) 1,434 fi ce Equipment, fi LandLeasehold ImprovementsBuildingsOf Furniture & Fittings 0 3,563 0 14,423 (3,448) 0 0 10,975 3,563 0 241 286 (77) 0 0 0 0 0 8 0 0 (439) 0 124 0 0 475 0 14,711 0 0 (3,879) 4,324 0 10,832 0 0 4,324 0 VehiclesLibrary BooksPlant and EquipmentOther AssetsVessels in ProgressWork 1,976 594 540 (1,384) 2,310 (352) (217) 1,068 592 4,385 (902) 242 86 323 1,408 (4,107) 0 57 12 231 (65) 1,068 278 440 (36) 0 0 0 0 (32) 0 0 53 0 0 0 36 (134) 0 0 0 (58) 8 0 (62) (134) 0 0 0 0 160 0 (70) (147) 2,005 0 0 0 0 (1,465) 516 0 2,701 651 540 1,329 0 (1,036) (239) (414) 4,385 1,665 278 0 237 (4,177) 1,329 208 Total $292,361 $(16,469) $275,890 $5,062 $(562) $0 $98 $(4,938) $0 $13,822 $302,999 $(13,625) $289,376 Land under roadsSewerageStormwater and BridgesRoads 19,246 suppliesWater Airport runwayLand 186,711 24,926Wharves 0 7,635 in ProgressWork (2,603) 18,056 19,246 (563) 184,107 (155) 174 24,362 1,757 30 (521) 7,480 1,217 17,535 409 (71) 2,103 140 (68) (4) 774 103 (28) 0 (491) (52) 0 (109) 0 1,217 0 1,612 0 516 0 0 0 0 0 0 0 (2,603) (90) 0 0 (576) 0 0 (563) 0 (155) 0 (521) 9,743 31 0 0 192,360 582 0 0 0 1,364 0 1,100 0 1,615 0 25,545 (8) 19,303 9,096 192,360 19,294 0 (35) 0 (657) 0 0 0 0 0 25,545 19,303 0 9,096 0 19,294 0 174 987 2,103 (79) 0 (526) 96 1,577 987 Other Fixed Assets Cost/ -Council2012 Infrastructure Assets Cost/ 140140 Amount Amount Amount Amount Carrying Carrying 30-06-11 30-06-11 on on Ɵ Ɵ 30-06-11 30-06-11 Deprecia Deprecia Accumulated Accumulated Accumulated Accumulated on on on on Ɵ Ɵ Cost/ Cost/ 30-06-11 30-06-11 Revalua Revalua on on Ɵ Ɵ Gains Gains Revalua Revalua Others Others Transfers/ Transfers/ on on Ɵ Ɵ Charges Current Year Year Current Current Year Year Current Deprecia Deprecia / Impairment / Impairment on on Ɵ Ɵ on Disposals on Disposals Deprecia Deprecia Accumulated Accumulated Accumulated Accumulated 0 8 (1,752) 147 0 29,486 (6,550) 22,936 for Sale for for Sale for Transfer Transfer Transfer Transfer (to)/from (to)/from (to)/from (to)/from Assets Held Assets Assets Held Assets Disposals Disposals Current Year Year Current Current Year Year Current on on Ɵ Ɵ Year Year Year Year Current Current Current Current Addi Addi 01-07-1 Amount Amount Amount Amount Carrying Carrying 01-07-11 on on Ɵ Ɵ Deprecia Deprecia Accumulated Accumulated Accumulated Accumulated o n o n Ɵ Ɵ $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 1,983 (1,461) 522 115 (12) 0 7 (153) 0 0 2,086 (1,607) 479 $51,920 $(15,276) $36,644 $2,190 $(524) $0 $367 $(2,812) $593 $0 $54,179 $(17,721) $36,458 29,196 (4,806) 24,390 220 (77) 01-07-11 01-07-11 $261,634 $(4,743) $256,891 $3,433 $(351) $0 $0 $(3,972) $(609) $14,300 $270,723 $(1,031) $269,692 Revalua Revalua lls/Transfer Stns lls/Transfer 1,850 (339) 1,511 0 0 0 0 (87) (18) 0 1,832 (426) 1,406 fi ce Equipment, fi Land under roadsSewerageStormwater and BridgesRoads 19,246 suppliesWater Airport runwayLand 186,557 24,908Wharves 0 7,610 in ProgressWork (2,603) 17,968 19,246 (563) 183,954 (155) 174 24,345 1,644 30 (521) 7,455 1,217Other 17,447 394 Fixed Assets (71) 2,104 (68) 132 (4) 717 (28) 103 0 (491) (52) 0 (109) 0 Cost/ 1,217 0 1,613 0 0 516 0 0 0 0 0 0 (2,603) (90) 0 0 (575) 0 0 (563) 0 (155) 0 10,010 (521) 31 0 192,362 0 610 0 0 0 1,397 0 1,133 0 0 1,760 25,545 (8) 19,303 9,123 192,362 19,294 0 (35) 0 (657) 0 0 0 0 0 25,545 19,303 0 9,123 0 19,294 0 174 986 2,104 (79) 0 (526) 95 1,578 986 LandLeasehold ImprovementsBuildings 0 4,547 0 0 0 4,547 88 319 0 0 0 0 0 0 (8) 0 0 475 0 0 88 5,341 (8) 0 80 5,341 Total $313,554 $(20,019) $293,535 $5,623 $(875) $0 $367 $(6,784) $(16) $14,300 $324,902 $(18,752) $306,150 VehiclesLibrary BooksPlant and EquipmentOther AssetsVessels in ProgressWork 2,932 3,597 594 (1,796) (1,796) 3,620 1,136 (352) 1,066 1,801 4,385 186 (958) 242 543 (4,107) 2,662 0 57 (76) (327) 222 1,066 278 440 0 0 0 0 0 (32) 63 0 289 0 0 (214) 0 (419) 0 0 0 8 0 0 (62) (134) 0 0 0 0 109 0 3,050 (70) 3,813 (146) (1,947) 0 0 (1,926) 0 1,103 0 3,951 1,887 651 1,328 0 (1,092) (414) 2,859 4,385 237 0 (4,177) 1,328 208 Of Furniture & Fittings -Group2012 Infrastructure Assets Cost/

Buller District Council 141141 Amount Amount Amount Amount Carrying Carrying 30-06-11 30-06-11 on on Ɵ Ɵ 30-06-11 30-06-11 Deprecia Deprecia Accumulated Accumulated Accumulated Accumulated on on on on Ɵ Ɵ Cost/ Cost/ 30-06-11 30-06-11 Revalua Revalua on on Ɵ Ɵ Gains Gains Revalua Revalua Others /Others Transfers Transfers Transfers/ on on Ɵ Ɵ Current Year Year Current Current Year Year Current Deprecia Deprecia on on Ɵ Ɵ on disposals on Disposals Deprecia Deprecia Accumulated Accumulated Accumulated Accumulated for Sale for for Sale for Transfer Transfer Transfer Transfer (to)/from (to)/from (to)/from (to)/from Assets Held Assets Assets Held Assets Charges Charges Disposals / Disposals / Impairment Impairment Impairment Impairment Current Year Year Current Current Year Year Current on on Ɵ Ɵ Year Year year year Current Current Current Current Addi Addi Amount Amount Amount Amount Carrying Carrying 01-07-10 01-07-10 on on Ɵ Ɵ deprecia Deprecia Accumulated Accumulated Accumulated Accumulated o n o n Ɵ Ɵ $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 1,508 (1,251) 257 66 0 0 0 (65) 0 0 1,574 (1,316) 258 $30,042 $(10,745) $19,297 $1,663 $(1,042) $0 $119 $(1,186) $(144) $0 $30,433 $(11,726) $18,707 01-07-10 01-07-10 $258,751 $(711) $258,040 $3,560 $(572) $(36) $0 $(3,951) $144 $0 $261,928 $(4,743) $257,185 Revalua Revalua ttings fi lls/Transfer Stns lls/Transfer 1,461 (274) 1,187 392 0 (36) 0 (70) 48 0 1,860 (339) 1,521 fi ce equipment, fi Land under roadsSewerageStormwater and bridgesRoads 19,246 suppliesWater Airport runwayLand 185,517 24,823Wharves 0 7,428 in ProgressWork 17,459 19,246 0 0 174 185,517 0 0 24,823 0 1,569Other 7,428 Fixed Assets 770 (63) 17,459 132 1,873 223 0 (375) 749 111 (374) (29) 0 Cost/ (16) 0 1,499 0 (152) 0 770 0 0 495 0 0 0 0 0 0 (2,603) 0 0 0 0 0 0 (563) 0 (155) (521) 0 0 0 0 0 0 0 0 0 0 186,711 0 (8) 0 19,246 0 (2,603) 0 24,926 (31) 0 184,108 0 7,635 18,056 144 (563) 0 (48) 24,363 0 (155) (521) 19,246 17,535 0 7,480 0 174 2,103 1,217 (71) (491) 103 1,612 0 1,217 LandLeasehold improvementsBuildingsOf furniture & 0 4,238 0 14,272 (3,189) 0 0 11,083 4,238 0Total 680 0 (367) 0 (675) 0 $288,793 0 0 $(11,456) $277,337 119 $5,223 0 (405) 0 $(1,614) (135) $(36) 0 0 $119 0 0 0 $(5,137) 14,423 0 (3,448) $0 0 10,975 3,563 0 $0 $292,361 (16,469) 0 $275,892 0 3,563 0 VehiclesLibrary booksPlant and equipmentOther assetsVessels in progressWork 2,028 539 383 (1,308) 2,084 (295) 720 (178) 605 4,385 (783) 244 205 7 1,301 (3,741) 157 55 0 226 644 0 605 0 0 0 472 0 0 0 0 0 0 0 0 0 0 0 0 (135) 0 (39) (57) (119) 0 0 0 0 0 0 (366) 0 0 0 0 1,976 0 0 (9) (1,384) 540 594 2,310 0 592 0 (217) (352) (902) 4,385 1,068 1,408 323 242 (4,107) 278 0 1,068 -Council2011 Infrastructure Assets Cost/ 142142 Amount Amount Amount Amount Carrying Carrying 30-06-11 30-06-11 on on Ɵ Ɵ 30-06-11 30-06-11 Deprecia Deprecia Accumulated Accumulated Accumulated Accumulated on on on on Ɵ Ɵ Cost/ Cost/ 30-06-11 30-06-11 Revalua Revalua on on Ɵ Ɵ Gains Gains Revalua Revalua Others Others Transfers/ Transfers/ on on Ɵ Ɵ Current Year Year Current Current Year Year Current Deprecia Deprecia on on Ɵ Ɵ on Disposals on Disposals Deprecia Deprecia Accumulated Accumulated Accumulated Accumulated for Sale for for Sale for Transfer Transfer Transfer Transfer (to)/from (to)/from (to)/from (to)/from Assets Held Assets Assets Held Assets Charges Charges Disposals / Disposals / Impairment Impairment Impairment Impairment Current Year Year Current Current Year Year Current on on Ɵ Ɵ Year Year Year Year Current Current Current Current Addi Addi Amount Amount Amount Amount Carrying Carrying 01-07-10 01-07-10 on on Ɵ Ɵ Deprecia Deprecia Accumulated Accumulated Accumulated Accumulated 0000000000000 o n o n Ɵ Ɵ $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 $000 Cost/ Cost/ 1,461 (274) 1,187 382 0 (36) 0 (70) 48 0 1,850 (339) 1,511 1,918 (1,337) 581 97 (32) 0 28 (150) (2) 0 1,983 (1,461) 522 $50,340 $(13,906) $36,434 $2,820 $(908) $0 $778 $(2,207) $(273) $0 $51,920 $(15,276) $36,644 01-07-10 01-07-10 $258,751 $(711) $258,040 $3,265 $(572) $(36) $0 $(3,951) $144 $0 $261,634 $(4,743) $256,891 Revalua Revalua lls/Transfer lls/Transfer fi ce Equipment, fi Other Fixed Assets Other Fixed Wharves in ProgressWork 770 1,873 (374) 0 1,499 770 0 495 0 0 0 0 0 0 (31) 0 144 (48) 0 0 2,104 1,217 (491) 1,613 0 1,217 Stations VehiclesLibrary BooksPlant and EquipmentOther AssetsVessels 2,853Leasehold 3,267 539Improvements (1,877) (1,989) 2,001 (295) 976 1,278 4,385 (800) 244 90 876 1,201 (3,741) 55 (237) 260 (546) 644 0 0 0 0 0 237 0 491 0 0 (203) (298) 0 0 273 0 0 (57) (109) 0 0 1,310 0 0 2,932 (366) 3,597 (1,796) 0 0 0 (1,796) 1,136 3,620 1,801 594 0 (958) (352) 4,385 2,662 242 (4,107) 278 Furniture & Fittings in ProgressWork Total 604 0 $309,091 604 $(14,617) $294,474 $6,085 472 $(1,480) 0 $(36) $778 0 $(6,158) $(129) 0 $0 $313,554 0 $(20,019) $293,535 (10) 0 1,066 0 1,066 Land under roadsSewerageStormwater 19,246 and BrdigesRoads suppliesWater Airport runway 185,517 24,823Land 0 7,428 19,246 17,459 0 0 174 185,517 0 0 24,823 0 1,415 7,428 (63) 17,459 114 198 0 (375) 661 111 (29) (16) 0 (152) 0 0 0 0 0 0 0 0 0 (2,603) 0 0 0 0 (563) 0 (155) (521) 0 0 0 0 0 0 0 186,557 (8) 0 19,246 0 (2,603) 0 24,908 0 183,954 7,610 17,968 (563) 0 24,345 0 (155) (521) 19,246 17,447 7,455 174 (71) 103 LandBuildingsOf 30,226 4,547 (3,867) 26,359 0 970 4,547 0 (93) 0 0 22 0 (1,024) (1,844) 0 0 0 29,196 0 (4,806) 24,390 0 4,547 0 4,547 -Group2011 Infrastructure Assets Cost/

Buller District Council 143143 Note14~IntangibleAssets

Parent Group

Computer Total Goodwill Software Total Software & Licences Licences $000 $000 $000 $000 $000

Cost Balance at 1 July 2010 194 194 698 0 892 Transfers 0 0 0 0 0 Additions 94 94 30 10 134 Disposals 0 0 0 0 0 Balance at 30 June 2011 $288 $288 $728 $10 $1,026

Balance at 1 July 2011 288 288 728 10 1,026 Transfers 0 0 0 0 0 Additions 133 133 0 12 145 Disposals 0 0 0 0 0 Balance at 30 June 2012 $421 $421 $728 $22 $1,171

Accumulated Amortisation and Impairment Balance at 1 July 2010 141 141 0 0 141 Transfers 0 0 0 0 0 Amortisation charge 62 62 0 4 66 Disposals 0 0 0 0 0 Balance at 30 June 2011 $203 $203 $0 $4 $207

Balance at 1 July 2011 203 203 0 4 207 Transfers 0 0 0 0 0 Amortisation charge 78 78 0 4 82 Disposals 0 0 0 0 0 Balance at 30 June 2012 $281 $281 $0 $8 $289

Carrying Amounts Balance at 30 June 2011 85 85 728 6 819 Balance at 30 June 2012 $140 $140 $728 $14 $882

Goodwill has been assessed for impairment during the year. Due to the performance of the subsidiary during the period it was determined that goodwill was not impaired. 144144 Note15~Trade&OtherPayables

Parent Group

Actual Actual Actual Actual 2011/2012 2010/2011 2011/2012 2010/2011 $000 $000 $000 $000

Trade payables $1,909 $1,758 $2,994 $2,801 Amounts due to related parties: WestReef Ltd 828 506 0 0 Buller Arts & Recreation Trust 0000 Buller Health Trust 0000 Buller Holdings Ltd 0000 Buller Recreation Ltd 745 71 0 0 Westport Harbour Ltd 0000

Revenue Received in Advance 569 1,368 385 1,251

TOTAL Trade and Payables $4,051 $3,702 $3,379 $4,052

Trade and other payables are non-interest bearing and are normally settled on 30 day terms, therefore the carrying value of creditors and other payables approximates their fair value.

Buller District Council 145145 Note16~DerivativeFinancialInstrument

Parent Group

Actual Actual Actual Actual 2011/2012 2010/2011 2011/2012 2010/2011 $000 $000 $000 $000

Current Liability Portion Interest Rate Swaps 0000 Total Current Liability Portion $0 $0 $0 $0

Non Current Liability Portion Interest Rate Swaps 902 643 902 643 Total Non Current Liability Portion $902 $643 $902 $643

The notional principal amounts of the outstanding interest rate swap contracts at 30 June 2012 were $15,000,000 (2011: 15,000,000).

At 30 June 2012 the fi xed interest rates of interest rate swaps vary from 4.89% to 5.59% (2011: 4.56% to 5.59%).

The interest rate swaps have been included at fair value.

The termination date of the interest rate swap contracts of $15,000,000 at 30 June 2012 vary from 31 March 2014 to 31 March 2017 (2011: 31 March 2013 to 31 March 2016). 146146 Note17~EmploymentBenefitLiabilities

Parent Group

Actual Actual Actual Actual 2011/2012 2010/2011 2011/2012 2010/2011 $000 $000 $000 $000

Accrued pay 150 132 172 132 Annual Leave & Long service leave 368 333 941 845 Retirement gratuities 149 133 253 284 Sick leave 0000 Total Employee Benefi t Liabilties $667 $598 $1,366 $1,261

Comprising: Current 468 437 1,063 947 Non-current 199 161 303 314 Total Employee Benefi t Liabilties $667 $598 $1,366 $1,261

Buller District Council 147147 Note18~Borrowings

Parent Group

Actual Actual Actual Actual 2011/2012 2010/2011 2011/2012 2010/2011 $000 $000 $000 $000

Current Bank overdraft 0 216 0 216 Secured loans 0000 Total current borrowings $0 $216 $0 $216

Non-current Secured loans 23,024 23,024 23,024 23,024 Total non-current borrowings $23,024 $23,024 $23,024 $23,024

Total Borrowings $23,024 $23,240 $23,024 $23,240

Fixed-ratedebt Buller District Council’s secured debt of $15,000,000 (2011: $15,000,000) is issued at fi xed rates of interest by way of interest rate swaps.

Floating-ratedebt Buller District Council’s debt of $8,023,860 (201: $8,023,860) is at a fl oating interest rate. The interest is set quarterly at the 90-day bill rate + 0.11%.

The debt is due to be repaid in 2013, at which time the terms and conditions may be re-negotiated.

Security The overdraft is secured by a general security agreement. The maximum amount that can be drawndown against the overdraft facility is $1,250,000 (2011: $1,250,000). There are no restrictions on the use of this facility.

Council’s loans are secured over either separate or general rates of the district.

Refinancing Council manages its borrowings in accordance with its funding and fi nancial policies, which includes a Treasury policy. These policies have been adopted as part of Council’s Long Term Plan 2012-2022. 148148

Maturityanalysisandeffectiveinterestrates The following is a maturity analysis of Council’s borrowings:

Overdraft Overdraft Secured Loans Council Group Council & Group $000 $000 $000

2011/2012 Less than one year 0 0 0 Wweighted average effective interest rate 7.95% 7.95% 0 Later than one year but not more than fi ve years 0 0 23,024 Weighted average effective interest rate 0% 0% 5.85% Later than fi ve years 0 0 0 Weighted average effective interest rate 0% 0% 0% $0 $0 $23,024

Overdraft Overdraft Secured Loans Council Group Council & Group $000 $000 $000

2010/2011 Less than one year 216 216 0 Wweighted average effective interest rate 8.3% 8.3% 0 Later than one year but not more than fi ve years 0 0 23,024 Weighted average effective interest rate 0% 0% 5.6% Later than fi ve years 0 0 0 Weighted average effective interest rate 0% 0% 0% $216 $216 $23,024

Fairvalueofnon-currentborrowings The carrying amounts of borrowings are at market interest rates and approximate their fair values.

Buller District Council 149149 Note19~Provisions

Landfi ll Contaminated Total Total Aftercare Site Environmental Environmental Provision Remediation Provisions Provisions

2011/2012 2011/2012 2011/2012 2010/2011 $000 $000 $000 $000

Environmental Position

Opening Balance $1,635 $9 $1,644 $1,587 Additional Provisions 0 0 0 0 Amounts Used (18) 0 (18) (18) Unused Provision Reversed (35) 0 (35) (36) Discounting Changes (55) 0 (55) 111 Closing Balance $1,527 $9 $1,536 $1,644 Council and Group

Current Liability 33 51 Non-current Liability 1,503 1,593 $1,536 $1,644 LandfillAftercareProvision Council has responsibility under its resource consents to provide ongoing maintenance and monitoring of its landfi lls after the sites are closed. Council’s closure and post closure responsibilities include:

Closureresponsibilities: - Lay cover and revegetation - Drainage control - Water quality monitoring

PostClosureresponsibilities: - Ground and surface water quality monitoring - Landfi ll gas monitoring - Site maintenance - Mitigation of environmental effects identifi ed - Annual reporting in accordance with consent conditions

The expected closure dates for Councils Landfi ll sites are as follows: Westport - Closed 2008 but still to be capped Birchfi eld - Closed 2005 Karamea - 2010 (Council has received a resource consent for The cash outfl ows for landfi ll post-closure costs an additional 30 years) have been estimated to occur for a period of 35 years from the closure of the site. Ikamatua - Closed 2005 Charleston - Closed 2010 The long term nature of the liability means that there are inherent uncertainties in estimating Mawheraiti - Closed 2005 costs that will be incurred. Inangahua - Closed 2010 The provision has been estimated taking into ac- Reefton - Closed 2005 count existing technology and is discounted us- ing a discount rate of 5.70% based on NZ Govern- Maruia - 2021 ment Bond rates (2011: 5.04%). 150150 Note20~AccumulatedFunds

Parent Group

2011/2012 2010/2011 2011/2012 2010/2011 $000 $000 $000 $000

Opening Balance as at 1 July $171,948 $174,806 $169,974 $172,747

Net Surplus (Defi cit) for the Period (501) (3,144) (422) (3,059) Transfer from Reserves 1,093 1,175 1,093 1,175 Transfer to Reserves (1,024) (889) (1,546) (889) Balance at 30 June $171,516 $171,948 $169,099 $169,974

Buller District Council 151151 Note21~Reserves

Parent Group

2011/2012 2010/2011 2011/2012 2010/2011 $000 $000 $000 $000

Balance as at 1 July $1,941 $2,227 $1,941 $2,227

Add: Transfer from Accumulated Funds 1,024 889 1,024 889 $2,965 $3,116 $2,965 $3,116

Less: Transfer to Accumulated Funds (1,093) (1,175) (1,093) (1,175) Balance at 30 June $1,872 $1,941 $1,872 $1,941 152152 Note22~AssetRevaluationReserves

Parent Group

2011/2012 2010/2011 2011/2012 2010/2011 $000 $000 $000 $000

Opening Balance as at 1 July $121,621 $121,499 $121,780 $121,658

Change in Asset Values through Comprehensive 13,812 122 14,334 122 Income Closing Balance as at 30 June $135,433 $121,621 $136,114 $121,780

Comprising: Library Books 258 258 258 258 Roads and Bridges 111,685 101,942 112,122 102,012 Sewerage 8,088 6,724 8,170 6,752 Stormwater 6,636 5,536 6,681 5,540 Water Supplies 8,761 7,146 8,860 7,184 Landfi ll 0 0 19 19 Investment Revaluation Reserve 4 15 4 15 Balance at 30 June $135,433 $121,621 $136,114 $121,780

Buller District Council 153153 Note23~RelatedPartyTransactions&Balances

Buller District Council is the ultimate parent of the Group and controls four Entities, being WestReef Services Limited, Buller Holdings Limited, Westport Airport Authority, Buller Health Trust, Buller Arts and Recreational Trust and Buller Recreation Limited.

The following transaction were carried out with related parties: Actual Actual 2011/2012 2010/2011 $000 $000

WestReef Services Limited Services provided by Council during the year 182 165 Services provided to Council during the year 7,044 6,760 Accounts payable to Council at 30 June 71 67 Accounts receivable from Council at 30 June 828 506 Sponsorship towards Vision 2010 and NBS Theatre 64 60 Subventions paid to Council during the year 276 0 Subventions payable to Council at 30 June 276 0

Buller Recreation Limited Service level fee paid by Council to Buller Recreation 780 738 Energy Subsidy paid by Council to Buller Recreation 157 157 Services provided to Council during the year 1 1 Services provided by Council during the year 22 19 Grants provided by Council during the year 0 1 Accounts payable to Council at 30 June 16 16 Accounts receivable from Council at 30 June 745 71

Buller Holdings Limited Accounts payable to Council at 30 June 88 88 Loans owed to Council at 30 June 2,364 2,364 Dividends paid to Council during the year 825 980 Interest Expenses paid to Council 88 88 Total Shares Issued to Council 18,988 18,688 Shares issued during the year 300 1,118 154154

Actual Actual 2011/2012 2010/2011 $000 $000

Westport Airport Authority Limited Services provided by Council during the year 34 39 Services provided by Westreef Services Limited during the year 22 13 Rates, lease and interest charges paid to Council during the year 1 1 Current account balance owed (to) from Council at 30 June 113 106 Accounts payable to WestReef Services Limited at 30 June 2 1 Lease Payments made to Westport Harbour Limited during the year 3 3

Westport Harbour Limited Services provided by Council during the year (including interest & lease 342 206 payments) Loans owed to Council at 30 June 200 200 Advances relating to purchase of business 479 517 Accounts payable to Council at 30 June 82 74 Advances relating to purchase of business (current receivable) 0 300

Buller Health Trust Interest paid to Council during the year 10 13 Loans owed to Council at 30 June 86 187 Accounts payable to Council at 30 June 2 9

Buller Arts and Recreation Trust Funds paid to Council 80 105

In addition there are administration services provided by Council to Buller Health Trust during the year for no consideration.

The $67,000 write-down in advances to Westport Harbour Limited has been reversed during the period as a commercial inter- est rate for the loan has been established. (2011; a total of $67,000 in debts were written off or forgiven during the period, including a writedown of $67,000 in the face value of advances to Westport Harbour Limited).

Buller District Council 155155

KeyManagementandMembersofCouncil During the year Councillors and Key Management, as part of a normal customer relationship, were involved in minor transactions with Council (such as payments of rates, purchase of rubbish bags, etc).

Mayor Pat McManus is a Director/Owner of Rainbow Cake Kitchen. During the period goods to the value of $1,726 were provided to Council (2011: $2,459). No services were provided by Gibbys Café (related party as guarantor to a loan) (2011: $62)

Councillor Margaret Montgomery is an Owner of Westport Holiday Park. During the period no goods and services were provided to Council (2011: $209)

Councillor Peter Campbell is a Principal of Campbell and Associates. During the period no goods or services were provided to Council (2011: $2,318). At a Group level goods and services to the value of $6,743 were provided to Council controlled entities (2010: $6,537).

KeyManagementPersonnelCompensation Actual Actual 2011/2012 2010/2011 $000 $000

Salaries and other short term employee benefi ts 772 761 Post employment, other long term benefi ts and share-based payments 0 0 $772 $761

Key management personnel include the Mayor, Councillors, Executive and other senior management personnel. 156156

Note24~ StatementofFinancialInvolvementsin CCTOs&OtherCompaniesorOrganisations

The Council has a signifi cant interest in the following entities: Entity Ownership Status Principal Activities Interest held by Council WestReef Services Limited Subsidiary CCTO Infrastructure, Maintenance & Construction 100% Buller Holdings Limited Subsidiary CCTO Ownership of Selected Council Assets & Invest- 100% ments Westport Harbour Limited Subsidiary CCTO Port Operations 100% Buller Recreation Limited Subsidiary CCTO Sports & Recreation Facilities 100% Buller Health Trust Controlled Exepted as a Dental Services 100% CCO Buller Arts & Recreation Controlled Controlled Charitable Trust 100% Trust Westport Airport Authority Joint Ven- CCO Airport Operation 50% ture Tourism West Coast (INC) Associate Exempted as a Incorporated Society 29% CCO Denniston Heritage Trust Associate Trust Incorporated Society 29%

CCTO: Council Controlled Trading Organisation CCO: Council Controlled Organisation

Council passed a resolution to exempt Tourism West Coast as a Council Controlled Organisation as is permitted under the Local Government Act (2002).

The cost to each of the above enterprises for the fi nancial interest, fi nance or fi nancial assistance of Council is as follows: Dividends Interest/ Grants Total Total 2011/2012 2011/2012 2011/2012 2010/2011 $000 $000 $000 $000

Westreef Services Limited 0 0 0 0 Buller Recreation Limited 0 0 0 0 Buller Holdings Limited 1,101 88 1,189 1,068 Westport Airport Limited 0 0 0 0 Westport Harbour 0 29 29 2 Buller Health Trust 0 10 10 13 Buller Arts & Recreation Trust (Grant) 0 80 80 105 Tourism West Coast (INC) 0 0 0 0 Denniston Heritage Charitable Trust 0 0 0 0 $1,101 $207 $1,308 $1,188

The provision of fi nancial assistance by Buller District Council is by way of share capital in Westreef Services Limited, Westport Harbour Limited and Buller Recreation Limited through Buller Holdings Ltd and by way of a current account facility provided to the Westport Airport Authority. The current account facility is provided on normal commercial terms. The Council’s interest in Buller Health Trust is by way of loan.

Buller District Council 157157

WestportAirportAuthority Westport Airport Authority is proportionately consolidated on a line by line basis in the Parent Financial Statements.

In 2011/2012 there were no contributions made by the joint venture holders. (2010/2011: There were no contributions made by the joint venture holders.)

Buller District Council’s 50% share of its interest in the joint venture is detailed below:

2011/2012 2010/2011 $000 $000

Current Assets 5 9 Long Term Assets 2,819 2,815 Current Liabilities 34 4 Long Term Liabilities 0 0 Income 59 58 Expenses 117 112

TourismWestCoast 2011/2012 2010/2011 $000 $000

Revenue 557 512 Profi t/ (Loss) (4) (27) Total Assets 284 300 Total Liabilities 21 33 Total Equity $263 $267 158158

Note25~ StatementofCommitments,Contingent Liabilities&ContingentAssets

Parent Group

2011/2012 2010/2011 2011/2012 2010/2011 COMMITMENTS $000 $000 $000 $000

Capital Commitments Approved and Contracted $83 $565 $83 $565

Non-cancellable Operating Lease Commitments Motor Vehicles: Not later than a year 85 94 85 94 Later than one year but not later than fi ve years 5 97 5 97 Later than fi ve years 0 0 0 0 $90 $191 $90 $191

Offi ce Equipment: Not later than a year 31 14 31 14 Later than one year but not later than fi ve years 103 0 103 0 Later than fi ve years 0 0 0 0 $134 $14 $134 $14

Westport Harbour Ltd leases land and buildings from Buller District Council. Operating lease revenue are as follows; OperatingLeaseRevenuecommitmentswithWestportHarbourLimited 2011/2012 2010/2011

$000 $000

Less than a year 206 216 More than 1 year less than 2 206 216 More than 2 years less than 5 439 559 Greater than 5 years 3,582 3,690 $4,433 $4,681

OtherContracts The following contracts held by Westreef Services Limited with Council expired at 30 June 2006. 2011/2012 2010/2010 $000 $000 Utility Services and Fire Fighting 942 667 Parks, Reserves, and Cemetaries 846 749 Refuse Collection, Recycling and Landfi ll 891 841 Operation $2,679 $2,257

Buller District Council 159159

These contracts have a seven year right of renewal (except for Landfi ll Operation) subject to negotiation between the parties. It has been agreed that the existing contracts be rolled over for a further year until further notice.

Council’s Roading Network Maintenance Contract was tendered in August 2004 under Transfund’s Competitive Pricing Procedures. The contract’s fi rst period term expired on 30 June 2006 and the existing contract has been extended for subsequent renewable yearly terms since then. The Roading Network Maintenance Contract was updated as at 01 July 2010. The committments under this contract are as follows:

2011/2012 2010/2011 Roading $000 $000

Not later than one year $2,242 $2,358

ContingentLiabilities Contingent Liabilities for Council and the Group are as follows: Council has a suspensory loan as at 30 June 2012 of $400,000 owing to Housing New Zealand. If Council decides not to proceed with planned pensioner housing upgrades then this amount is required to be paid back (2011: $400,000). Council has no outstanding leaky home claims for which Council may be liable ($2011: $80,000 leaky home claim). A legal dispute is underway between Council and developer Swordfi sh Co Limited. The company has sued the Buller District Coun- cil in regard to the standard of two sections that the company purchased in 2007 on a newly formed subdivision. The company claims that the Council had signed off on the subdivision, but it was subsequently revealed that it has inadequate fi ll and lacked fl ood protection, both measures being conditions of the resource consent. The company has alleged that the Council had a duty of care to ensure that the sections were compliant with the terms of the consent. The matter is currently being handled through the Council’s insurers and Council’s exposure in this regard is limited to the excess on the policy. Council has a liability to Riskpool for a call on insurance premiums the amount was not known at balance date. Westreef had $64,000 in Performance Bonds outstanding with Westpac as at 30 June 2012 (2011: $64,000). Buller Health Trust has a contingent liability as at 30 June 2012 for rework or settlement on a patient treated in 2007. No values were known at balance date. (2011: Nil). Buller Holdings Limited has no contingent liabilities as at 30 June 2012 (2011: Nil). Westport Harbour Ltd has no contingent liabilities as at 30 June 2012 (2011: Nil). Buller Arts & Recreation Trust and Tourism West Coast (INC) also have no contingent liabilities as at 30 June 2012 (2011: Nil).

ContingentAssets Buller District Council has a contingent asset relating to construction of the Solid Energy Centre hockey turf. The turf has not met expectations as a playing surface. Council has met with contractors involved in the original construction of the hockey ground to seek settlement. However no estimate of a settlement can be made at balance date apart from Buller District Council parent, the Group has no contingent assets as at 30 June 2012. (2011: Nil). 160160 Note26~CapitalManagement

The Council’s capital is its equity (or ratepayers funds), which comprise retained earnings, reserves and asset revaluation reserves. Equity is represented by net assets.

The Local Government Act 2002 (the Act) requires Council to manage its revenues, expenses, assets, liabilities, investments, and general fi nancial dealings prudently and in a manner that promotes the current and future interests of the community. Ratepayer’s funds are largely managed as a by-product of managing revenues, expenses, assets, liabilties, investments, and general fi nancial dealings.

The objective of managing these items is to achieve intergenerational equity, which is a principle promoted in the Act and applied by Council. Intergenerational equity requires today’s ratepayers to meet the costs of utilising Council’s assets and not expecting them to meet the full cost of long term assets that will benefi t ratepayers in future generations. Additionally, Council has in place asset managment plans for major classes of assets detailing renewal and maintenance programmes, to ensure ratepayers in future generations are not required to meet the costs of deferred renewals and maintenance.

The Act requires Council to make adequate and effective provision in its Long Term Plan (LTP) and in its Annual Plan (where applicable) to meet the expenditure needs identifi ed in those plans. And the Act sets out the factors that Council is required to consider when determining the most appropriate sources of funding for each of its activities. The sources and levels of funding are set out in the Funding and Financial Policies in the Long Term Plan.

Buller District Council has the following Council created reserves: • Reserves for different areas of benefi t; • Self-insurance reserves; and • Trust and bequest reserves.

Reserves for different areas of benefi t are used where there is a discrete set of rate or levy payers as distinct from the general rate. Any surplus of defi cit relating to these seperate areas of benefi t is applied to the specifi c reserves.

Self-insurance reserves are built up annually from general rates and are made available for specifi c unforseen events. The release of these funds generally can only be approved by Council.

Trust and bequest reserves are set up where Council has been donated funds that are restricted for particular purposes. Interest is added to trust and bequest reserves where applicable and deductions are made where funds have been used for the purpose they were donated.

Buller District Council 161161 Note27~FinancialInstruments

FinancialInstrumentRisks Buller District Council has a series of policies to manage the risks associated with fi nancial instruments. Council is risk averse and seeks to minimise exposure from its treasury activities. Council has established Council Approved Liability Management and Investment Policies. These policies do not allow any transactions that are speculative in nature to be entered into.

MarketRisk

PriceRisk Price risk is the risk that the value of a fi nancial instrument will fl uctuate as a result of changes in market prices. Council may be exposed to equity securities price risk on its investments, which are classifi ed as fi nancial assets held at fair value through equity. This price risk on its investment portfolio in accordance with the limits set out in Council’s Investment Policy. Council currently doesn’t hold listed equity instruments which are publicly traded and included in the NZX50 equity index.

CurrencyRisk Currency risk is the risk that the value of a fi nancial instrument will fl uctuate due to changes in foreign exchange rates. Council is not exposed to currency risk, as it does not enter into foreign currency transactions.

InterestRateRisk The interest rates on Council’s investments are disclosed in Note 12 and on Council’s borrowings in Note 18.

FairValueInterestRateRisk Fair value interest rate risk is the risk that the value of a fi nancial instrument will fl uctuate due to changes in market interest rates. Borrowings issued at fi xed rates expose Council to fair value interest rate risk. Council’s Liability Management Policy outlines the level of borrowing that is to be secured using fi xed rate instruments. Fixed to fl oating interest rate swaps are entered into to hedge the fair value interest rate risk arising where Council has borrowed at fi xed rates. In addition, investments at fi xed interest rates expose Council to fair value interest rate risk.

CashflowInterestRateRisk Cashfl ow interest rate risk that the cashfl ows from a fi nancial instrument will fl uctuate because of changes in market interest rates. Borrowings and investments issued at variable interest rates expose Council to cashfl ow interest rate risk.

Council manages its cashfl ow interest rate risk on borrowings by using fl oating-to-fi xed interest rate swaps. Such interest rate swaps have the economic effect of converting borrowings at fl oating rates and swaps them into fi xed rates that are generally lower than those available if Council borrowed at fi xed rates directly. Under the interest rate swaps, Council agrees with other parties to exchange, at specifi ed intervals, the difference between fi xed contract rates and fl oating rate interest amounts calculated by reference to the agreed notional principal amounts.

CreditRisk Credit risk is the risk that a third party will default on its obligation to Council, causing Council to incur a loss. Council has no signifi cant concentrations of credit risk, as it has a large number of credit customers, mainly ratepayers. Council has powers under the Local Government (Rating) Act 2002 to recover outstanding debts from ratepayers. 162162

LiquidityRisk Liquidity risk is the risk that Council will encounter diffi culty raising liquid funds to meet commitments as they fall due. Prudent liquidity risk management implies maintaining suffi cient cash, the availability of funding through an adequate amount of committed credit facilities and the ability to close out market positions. Council aims to maintain fl exibility in funding by keeping committed credit lines available. In meetings its liquidity requirements Council maintains a target level of investments that must mature within the next 12 months. Council manages its borrowings in accordance with its funding and fi nancial policies, which includes a Liability Management Policy. These policies have been adopted as part of Council’s Long Term Plan.

Council has a maximum amount that can be drawn against its overdraft facility of $1,250,000 (2011: $1,250,000). There are no restrictions on the use of this facilty.

The maturity profi les of Council’s interest bearing investments and borrowings are disclosed in Note 18.

Parent Group

2011/2012 2010/2011 2011/2012 2010/2011 $000 $000 $000 $000

Financial Assets Loans and Receivables: Cash and Cash Equivalents 1,986 506 2,560 1,818 Debtors and Other Receivables 4,645 4,259 4,708 4,334 Other Financial Assets: - Short Term Deposits 10,938 10,376 12,241 11,229 - Community Loans 0 0 0 0 - Loans to Related Parties 3,129 3,110 0 0 Total Loans and Receivables $20,698 $18,251 $19,509 $17,381

Fair Value Through Other Comprehensive Income Other Financial Assets: - Unlisted shares 31 31 31 32 Total Fair Value Through Other Comprehensive Income $31 $31 $31 $32

Financial Liabilities Fair Value Through Surplus or Defi cit - Held For Trading Derivative Financial Instrument Liabilities 902 643 902 643 Total Financial Liabilities At Fair Value Through Surplus or $902 $643 $902 $643 Defi cit

Financial Liabilities At Amortised Cost Creditors And Other Payables 4,051 3,702 3,379 4,052 Borrowings: - Bank Overdraft 0 216 0 216 - Secured Loans 23,024 23,024 23,024 23,024 Total Financial Liabilities At Amortised Cost $27,075 $26,942 $26,403 $27,292 Buller District Council 163163

FairValueHeirarchyDisclosures For those instruments recognised at fair value in the statement of fi nancial position fair values are determined according to;

Valuation techniques using observable inputs (level 2) - Financial instruments with quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in inactive markets and fi nancial instruments valued using models where all signifi cant inputs are observable.

Valuation techniques with signifi cant non-observable inputs (level 3) - Financial instruments valued using models where one or more signifi cant inputs are not observable.

Observable Signifi cant Non- Total Inputs obsevable Inputs $000 $000 $000

Parent 2011/2012 Financial Assets: Unlisted Shares 0 31 31

Financial Liabilities: Derivative Financial Instrument 902 0 902 Liabilities

Group 2011/2012 Financial Assets: Unlisted Shares 0 31 31

Financial Liabilities: Derivative Financial Instrument 902 0 902 Liabilities

Observable Signifi cant Non- Total Inputs obsevable Inputs $000 $000 $000

Parent 2010/2011 Financial Assets: Unlisted Shares 0 31 31

Financial Liabilities: Derivative Financial Instrument 643 0 643 Liabilities

Group 2010/2011 Financial Assets: Unlisted Shares 0 32 32

Financial Liabilities: Derivative Financial Instrument 643 0 643 Liabilities 164164

MaximumExposuretoCreditRisk Buller District Council’s maximum exposure for each class of fi nancial instrument is as follows:

Parent Group

2011/2012 2010/2011 2011/2012 2010/2011 $000 $000 $000 $000

Cash at Bank and Term Deposits 12,924 10,882 14,801 13,047 Debtors and Other Receivables 4,645 4,259 4,708 4,334 Community and Related Party Loans 3,129 3,110 0 0 Total Credit Risk $20,698 $18,251 $19,510 $17,381

CreditQualityofFinancialAssets The credit quality of fi nancial assets that are neither past due nor impaired can be assessed by reference to Standard and Poors or Fitch Credit Ratings (if available) or to historical information about counterparty default rates:

Parent Group

2011/2012 2010/2011 2011/2012 2010/2011 $000 $000 $000 $000

Counterparties With Credit Ratings Cash at Bank and Term Deposits: AA 9,456 7,414 11,335 9,579 BB 3,468 3,468 3,468 3,468 Total Cash at Bank and Term Deposits $12,924 $10,882 $14,801 $13,047

Counterparties Without Credit Ratings Cash at Bank and Term Deposits: Existing counterparty with no defaults in the past 0000 Total Cash at Bank and Term Deposits $0 $0 $0 $0

Community and Related Party Loans: Existing counterparty with no defaults in the past 3,129 3,110 0 0 Total Community and Related Party Loans $3,129 $3,110 $0 $0

Buller District Council 165165

ContractualMaturityAnalysisofFinancialLiabilities Carrying Contractual Less than 1 1-2 Years 2-5 Years More Than Amount Cashfl ows Year 5 Years $000 $000 $000 $000 $000 $000

PARENT 2011/2012 Creditors and Other Payables 4,051 4,051 4,051 0 0 0 Net Settled Derivative Liabilities 902 902 0 45 857 0 Bank Overdraft 0 0 0 0 0 0 Secured Loans 23,024 26,010 1,059 10,083 14,868 0 Total $27,977 $30,963 $5,110 $10,128 $15,725 $0

GROUP 2011/2012 Creditors and Other Payables 3,379 3,379 3,379 0 0 0 Net Settled Derivative Liabilities 902 902 0 45 857 0 Bank Overdraft 0 0 0 0 0 0 Secured Loans 23,024 26,010 1,059 10,083 14,868 0 Total $27,305 $30,291 $4,438 $10,128 $15,725 $0

PARENT 2010/2011 Creditors and Other Payables 3,702 3,702 3,702 0 0 0 Net Settled Derivative Liabilities 643 643 0 162 481 0 Bank Overdraft 216 216 216 0 0 0 Secured Loans 23,024 24,130 8,326 15,804 0 0 Total $27,585 $28,691 $12,244 $15,966 $481 $0

GROUP 2010/2011 Creditors and Other Payables 4,052 4,052 4,052 0 0 0 Net Settled Derivative Liabilities 643 643 0 162 481 0 Bank Overdraft 216 216 216 0 0 0 Secured Loans 23,024 24,130 8,326 15,804 0 0 Total $27,935 $29,041 $12,594 $15,966 $481 $0

This table analyses Buller District Council’s fi nancial liabilities into relevant maturity groupings based on the remaining period at the balance date to the contractual maturity date.

Future interest payments on fl oating rate debt is based on the fl oating rate on the instrument at balance date. The amounts disclosed are the contractual undiscounted cashfl ows. 166166

ContractualMaturityAnalysisofFinancialAssets Carrying Contractual Less than 1 1-2 Years 2-5 Years More Amount Cashfl ows Year Than 5 Years $000 $000 $000 $000 $000 $000

PARENT 2011/2012 Cash and Cash Equivalents 1,986 1,986 1,986 0 0 0 Debtors and Other Receivables 4,645 4,645 4,645 0 0 0 Other Financial Assets: - Short Term Deposits 10,938 11,220 11,220 0 0 0 - Loans to Related Parties 3,129 3,247 3,000 247 0 0 Total $20,698 $21,098 $20,851 $247 $0 $0

GROUP 2011/2012 Cash and Cash Equivalents 2,560 2,560 2,560 0 0 0 Debtors and Other Receivables 4,708 4,708 4,708 0 0 0 Other Financial Assets: - Short Term Deposits 12,241 12,242 12,242 0 0 0 - Loans to Related Parties 0 0 0 0 0 0 Total $19,509 $19,510 $19,510 $0 $0 $0

PARENT 2010/2011 Cash and Cash Equivalents 506 506 506 0 0 0 Debtors and Other Receivables 4,259 4,259 4,259 0 0 0 Other Financial Assets: - Short Term Deposits 10,376 10,671 10,671 0 0 0 - Loans to Related Parties 3,110 2,660 2,660 0 0 0 Total $18,251 $18,096 $18,096 $0 $0 $0

GROUP 2010/2011 Cash and Cash Equivalents 1,818 1,818 1,818 0 0 0 Debtors and Other Receivables 4,334 4,334 4,334 0 0 0 Other Financial Assets: - Short Term Deposits 11,229 11,229 11,229 0 0 0 - Loans to Related Parties 0 0 0 0 0 0 Total $17,381 $17,381 $17,381 $0 $0 $0

This table analyses Buller District Council’s fi nancial assets into relevant maturity groupings based on the remaining period at the balance date to the contractual maturity date. The amounts disclosed are the contractual undiscounted cashfl ows.

Buller District Council 167167

FinancialInstrumentRisks

SensitivityAnalysis The tables below illustrate the potential profi t and loss and equity (excluding retained earnings) impact for reasonably possible market movements, with all other variables held constant, based on Buller District Council’s fi nancial instrument exposures at the balance date.

2011/2012 2010/2011 Council- $000 $000 Note -100bps +100bps -100bps +100bps InterestRateRisk Profi t Other Profi t Other Profi t Other Profi t Other Equity Equity Equity Equity

Financial Assets Cash and Cash Equivalents 1 (14) 0 14 0 0 0 0 0 Other Financial Assets - Short Term 2 (109) 0 109 0 (104) 0 104 0 Deposits

Financial Liabilities Cash and Cash Equivalents - Bank 3 0 0 0 0 2 0 (2) 0 Overdraft Derivatives - Held for Trading 4 (150) 0 150 (150) 0 150 Borrowings - Secured Loans 5 80 0 (80) 0 80 0 (80) 0

Total Sensitivity to Interest Rate Risk (193) 0 193 0 (172) 0 172 0

ExplanationofSensitivityAnalysis-Council FinancialAssets 1.CashandCashEquivalents Cash and cash equivalents of $1,986,000 (2011: $506,000) of which $586,000 (2011; $506,000) are held in non-interest bearing cheque deposit accounts. A movement in interest rates of plus or minus 1.0% has an effect on interest income of $14,000 (2011: nil).

2.OtherFinancialAssets-ShortTermDeposits Short Term Deposits consist of term deposits at fi nancial institutions and total $10,940,000 (2011: $10,376,000). A movement in interest rates of plus or minus 1.0% has an effect on investment income of $109,400 (2011: $104,000).

FinancialLiabilities 3.BankOverdraft There were no bank overdrafts in 2012 (2011: $216,000). Bank overdrafts are at fl oating interest rates. Therefore a movement in interest rates of plus or minus 1.0% has no effect on interest expense (2011: $2,000).

4.Derivatives-HeldForTrading Derivative fi nancial instruments held for trading consist of interest rate swaps with a fair value totalling $902,000 (2011: $643,000). A movement in interest rates of plus or minus 1.0% has an effect on realised reciepts/(payments) on the derivatives during the period of $150,000 (2011: $150,000 ).

5.Borrowings-SecuredLoans Council has fl oating rate debt with a principal amount totalling $8,024,000 (2011: $8,024,000). A movement in interest rates of plus or minus 1.0% has an effect on interest expense of $80,000 (2011: $80,000). a movement in market interest rates on fi xed rate debt does not have any impact on interest expense. 168168

2011/2012 2010/2011 Group- $000 $000 Note -100bps +100bps -100bps +100bps InterestRateRisk Profi t Other Profi t Other Profi t Other Profi t Other Equity Equity Equity Equity

Financial Assets Cash and Cash Equivalents 1 (14) 0 14 0 (3) 0 3 0 Other Financial Assets - Short Term Deposits 2 (122) 0 122 0 (112) 0 112 0

Financial Liabilities Cash and Cash Equivalents - Bank Overdraft 3 0 0 0 0 2 0 (2) 0 Derivatives - Held for Trading 4 (150) 0 150 (150) 0 150 Borrowings - Secured Loans 5 80 0 (80) 0 80 0 (80) 0

Total Sensitivity to Interest Rate Risk (206) 0 206 0 (183) 0 183 0

ExplanationofSensitivityAnalysis-Group FinancialAssets 1.CashandCashEquivalents Cash and cash equivalents of $2,560,000 (2011: $1,818,000) of which $1,160,000 (2011: $1,515,000) are held in non-interest bearing cheque deposit accounts. A movement in interest rates of plus or minus 1.0% has an effect on interest income of $14,000 (2011: $3,000).

2.OtherFinancialAssets-ShortTermDeposits Short Term Deposits consist of term deposits at fi nancial institutions and total $12,242,000 (2011: $11,229,000). A movement in interest rates of plus or minus 1.0% has an effect on investment income of $122,000 (2011: $112,000).

FinancialLiabilities 3.BankOverdraft There were no bank overdrafts in 2012 (2011: $216,000). Bank overdrafts are at fl oating interest rates. Therefore a movement in interest rates of plus or minus 1.0% has no effect on interest expense (2011: $2,000).

4.Derivatives-HeldForTrading Derivative fi nancial instruments held for trading consist of interest rate swaps with a fair value totalling $902,000 (2011: $643,000). A movement in interest rates of plus or minus 1.0% has an effect on realised reciepts/(payments) on the derivatives during the period of $150,000 (2011: $150,000 ).

5.Borrowings-SecuredLoans The Group has fl oating rate debt with a principal amount totalling $8,024,000 (2011: $8,024,000). A movement in interest rates of plus or minus 1.0% has an effect on interest expense of $80,000 (2011: $80,000). A movement in market interest rates on fi xed rate debt does not have any impact on interest expense.

Buller District Council 169169 Note28~PostBalanceDateEvents

There are no signifi cant events occurring after balance date that impact on the reported fi nancial information for the year ending 30 June 2012 for Buller District Council and the Group.

(2011: Subsequent to balance date, in August 2011, Buller Holdings issued $300,000 ordinary shares at $1 each in order to make the second and fi nal payment for land and buildings purchased from Buller District Council prior to 30 June 2011.) 170170

Note29~ ExplanationsofMajorVariancesagainst Budget

Explanations for major variations from the Council’s budget fi gures in the 2011-12 Annual Plan are as follows:

StatementofComprehensiveIncome

Operating revenue was $1.5 million greater than budget. The major reasons for this are: • Increase in investment income of $0.3m. This is due to Council receiving a subvention payment of $0.3m from Westreef Services Ltd. • Increase in fees and charges of $0.9m. This included unbudgeted income from domain boards of $0.4m. In addition, a budget error for dog registration income resulted in budgeted income being understated by $0.3m. • Increase in fi nancial assistance income of $0.2m. During 2011/12, Council received fi nancial assistance for the Solid Energy Centre, NBS Theatre, Cultural Hub, and the upgrading of its water supplies.

Operating expenditure was $3.6 million greater than budget. The major reasons for this are: • Recognition of an unbudgeted obligation of $0.8m to Buller Recreation Ltd for damage to the hockey turf. Council agreed to fund the repair of the turf. • Unbudgeted legal and consultant costs of $0.1m in relation to a dispute with contractors over the damaged hockey turf referred to above. • Unbudgeted expenditure for domain boards of $0.3m. • Unbudgeted painting expenditure of $0.1m arising from change in accounting treatment. • Additional costs of $0.1m relating to greater use of external consultants to assist with a higher workload associated with an increase in resource consents and more complex resource consents. • Higher than anticipated costs of operating the landfi ll and transporting refuse and recycling of $0.1m. • A contribution of $0.3m to Buller Recreation Ltd towards its power and heating costs. • Unbudgeted loss on derivative contracts of $0.3m. • Unbudgeted impairment of Council’s investment in Buller Holdings Ltd of $0.7m. • Unbudgeted asset write-offs of $0.5m.

StatementofFinancialPosition • Cash and cash equivalents has increased $1.4m above budget. This is due to proceeds from the sale of investment properties. • Trade and other receivables have increased mainly due to water supply subsidies accrued at year end for Reefton and Punakaiki water supplies. • Investments have decreased $4.6m due to changes in assumptions regarding the structuring of the ownership of ha- bour. • Infrastructural assets have decreased $15m due to major deferral of capital projects (Westport Water Upgrade, Drink- ing Water Upgrades). • Other non-current assets are less than budget $2.8m due to transactions of land and buildings associated with the sale of Westport Harbour Limited. • Trade and Other payables have decreased due to deferral of capital projects. • Term debt has decreased $6.5m due to deferral of capital projects. Buller District Council 171171

Accounting Policies

ReportingEntity The Buller District Council is a territorial local authority governed by the Local Government Act 2002.

The Buller District Council group consists of Buller District Council and its subsidiaries Buller Holdings Ltd, WestReef Services Ltd (owned by Buller Holdings Ltd), Buller Recreation Ltd and Westport Harbour Ltd (all 100% owned), sub- sidiaries in substance Buller Health Trust and Buller Arts and Recreation Trust (BART) and Westport Airport Authority (50% joint venture).

The primary objective of Buller District Council is to provide goods and services for the community or social benefi t, rather than making a fi nancial return. Accordingly, Buller District Council has designated itself and the group as a public benefi t entity for the purposes of New Zealand equivalents to International Financial Reporting Standards (NZ IFRS).

The fi nancial statements of Buller District Council are for the year ended 30 June 2011. The fi nancial statements were authorised for issue by Council on 31 October 2012.

BasisofPreparation The fi nancial statements of Buller District Council have been prepared in accordance with the requirements of the Local Government Act 2002: Part 6, Section 98 and Part 3 of schedule 10, which includes the requirement to comply with New Zealand Generally Accepted Accounting Practice (NZ GAAP).

These fi nancial statements have been prepared in accordance with NZ GAAP. They comply with NZ IFRS, and other applicable Financial Reporting Standards, as appropriate for public benefi t entities. The accounting policies set out below have been applied consistently to all periods presented in these fi nancial statements.

The fi nancial statements have been prepared on a historical cost basis, modifi ed by the revaluation of certain infra- structural assets, investment property and fi nancial instruments.

The fi nancial statements are presented in New Zealand dollars and all values are rounded to the nearest thousand dollars ($1,000) unless stated. The functional currency of Buller District Council is New Zealand dollars.

There have been no changes in accounting policies during the fi nancial year.

The Council and group has adopted the following revisions to accounting standards during the fi nancial year, which have only a presentational or disclosure effect:

FRS-44 New Zealand Additional Disclosures and Amendments to NZ IFRS to harmonise with IFRS and Australian Ac- counting Standards (Harmonisation Amendments) – The purpose of the new standard and amendments is to harmo- nise Australian and New Zealand accounting standards with source IFRS and to eliminate many of the differences between the accounting standards in each jurisdiction. The main effect of the amendments on the Council and group is that certain information about property valuations is no longer required to be disclosed. AccountingPolicies 172

Subsidiaries Subsidiaries are those entities where Buller District Council has the capacity to control their fi nancing and operating policies so as to obtain benefi ts from the activities of the entity. This power exists where Buller District Council controls the majority voting power of the governing body or where such policies have been irreversibly predetermined by Buller District Council.

The subsidiaries of Buller District Council are Buller Holdings Limited, WestReef Services Limited, Westport Harbour Limited, Buller Recreation Limited, Buller Health Trust and Buller Arts and Recreation Trust (BART).

Buller District Council measures the cost of a business combination as the aggregate of the fair values at the date of exchange, of assets given, liabilities incurred or assumed, in exchange for control of the subsidiary plus any costs attributable to the business combination.

Any excess of the cost of the business combination over Buller District Council’s interest in the net fair value of the identifi - able assets, liabilities and contingent liabilities, is recognised as goodwill. If Buller District Council’s interest in the net fair value of the identifi able assets, liabilities and contingent liabilities exceeds the cost of the business combination, the differ- ence will be recognised immediately in the surplus or defi cit.

The purchase method of consolidation has been used to prepare the consolidated fi nancial statements, which involves adding together like items of assets, liabilities, equity, income and expenses on a line by line basis. All signifi cant intragroup bal- ances, transactions, income and expenses are eliminated on consolidation.

Buller District Council’s investment in its subsidiaries is carried at cost in the Buller District Council’s own “parent entity” fi nancial statements.

Associates An associate is an entity over which Buller District Council has signifi cant infl uence and that is neither a subsidiary nor an interest in a joint venture. Buller District Council accounts for an investment in an associate using the equity method. The investment in an associate is initially recognised at cost and the carrying amount is increased or decreased to recognise the share of the surplus or defi cit of the associate. The Council has two associates, Tourism West Coast and Denniston Heritage Trust. There is no equity investment and there- fore no results are equity accounted for in these fi nancial statements. Further disclosure of the results of these associates is provided in note 24.

JointVentures A joint venture is a contractual arrangement whereby two or more parties undertake an economic activity that is subject to joint control. Buller District Council has a 50/50 joint venture interest in the Westport Airport Authority with Ministry of Transport. Buller District Council recognises in its fi nancial statements the assets it controls, the liability and expenses it incurs, and the share of income that it earns from the joint venture.

Revenue Revenue is measured at the fair value of consideration received. Revenue from the rendering of services is recognised by the reference to the stage of completion of the transaction at balance date based on the actual service provided as a percentage of the total services to be provided.

RatesRevenue. Rates are set annually by a resolution from Council and relate to a fi nancial year. All ratepayers are invoiced within the fi - nancial year to which the rates have been set. Rates revenue is recognised when payable.

Buller DistrictDistric CouncilCouncil 173

OtherRevenue Buller District Council receives Government Grants from the New Zealand Transport Authority, which subsidises part of Buller District Council’s costs in maintaining the local roading infrastructure. Grants are received from the Ministry of Health for eligible sewerage schemes. The subsidies are recognised as revenue upon entitlement as conditions pertaining to eligible expenditure are fulfi lled. Sales of goods are recognised when a product is sold to a customer. Sales are usually in cash. The recorded revenue is the gross amount of the sale. Where a physical asset is acquired for nil or nominal consideration, the fair value of the asset received is recognised as rev- enue. Assets vested in Buller District Council are recognised as revenue when control over the asset is obtained. Rental income is recognised on a straight line basis. Interest income is recognised using the effective interest method. Dividends are recognised when the right to receive the payment has been established.

BorrowingCosts Borrowing costs are recognised as an expense in the period in which they are incurred.

GrantExpenditure Non-discretionary grants are those grants that are awarded if the grant application meets the specifi ed criteria and are rec- ognised as expenditure at the time when such application has been received. Discretionary grants are those grants that Buller District Council has no obligation to award and are recognised as expenditure when a successful applicant has been notifi ed of the Buller District Council’s decision.

IncomeTax Income tax expense in relation to the surplus or defi cit for the period comprises current tax and deferred tax. Current tax is the amount of income tax payable based on the taxable profi t for the current year, plus any adjustments to income tax payable in respect of prior years. Current tax is calculated using rates that have been enacted or substantively enacted by balance date. Deferred tax is the amount of income tax payable or recoverable in future periods in respect of temporary differences and unused tax losses. Temporary differences are differences between the carrying amount of assets and liabilities in the fi nan- cial statements and the corresponding tax bases used in the computation of taxable profi t. Deferred tax liabilities are generally recognised for all taxable temporary differences. Deferred tax assets are recognised to the extent that it is probable that taxable profi ts will be available against which the deductible temporary differences or tax losses can be utilised. Deferred tax is not recognised if the temporary difference arises from the initial recognition of goodwill, or from the initial recognition of an asset and liability in a transaction that is not a business combination, and at the time of the transaction, affects neither accounting profi t nor taxable profi t. Deferred tax is recognised on taxable temporary differences arising from investments in subsidiaries and associates, and interests in joint ventures, except where the Council can control the reversal of the temporary difference and it is probable that the temporary difference will not reverse in the foreseeable future. Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised, using tax rates that have been enacted or substantively enacted by balance date. Current tax and deferred tax is shown against the surplus or defi cit for the period, except when it relates to items charged or credited directly to equity, in which case the tax is dealt with in equity. 174

Leases FinanceLeases A fi nance lease is a lease that transfers to the lessee substantially all the risks and rewards incidental to ownership of an asset, whether or not title is eventually transferred. At the commencement of the lease term, Buller District Council recognises fi nance leases as assets and liabilities in the Statement of Financial Position at the lower of the fair value of the leased item or the present value of the minimum lease payments. The amount recognised as an asset is depreciated over its useful life. If there is no certainty as to whether Buller District Council will obtain ownership at the end of the lease term, the asset is fully depreciated over the lease term or useful life, whichever is the shortest.

OperatingLeases An operating lease is a lease that does not transfer substantially all the risks and rewards incidental to ownership of the asset. Lease payments under an operating lease are recognised as an expense on a straight line basis over the lease term.

CashandCashEquivalents Cash and cash equivalents includes cash on hand, deposits held on call with banks, other short term highly liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown as current liabilities in the Statement of Financial Position.

TradeandOtherReceivables Trade and other receivables are initially measured at fair value and subsequently measured at amortised cost using the effec- tive interest rate method, less any provision for impairment. Loans, including loans to community organisations made by Buller District Council at nil, or below market interest rates, are initially recognised at the present value of their expected future cash fl ows, discounted at the current market rate of return for a similar asset / investment. They are subsequently measured at amortised cost using the effective interest method. The difference between the face value and the present value of the expected future cash fl ows of the loan is recognised in the surplus or defi cit. A provision for impairment of receivables is established when there is objective evidence that Buller District Council will not be able to collect all the amounts due according to the original terms of receivables. The amount of the provision is the difference between the assets carrying amount and the present value of estimated future cash fl ows, discounted using the effective interest method.

Inventories Inventories held for distribution or consumption in the provision of services that are not supplied on a commercial basis are measured at the lower of cost and current replacement cost. Inventories held for use in the production of goods and services on a commercial basis are valued at the lower of cost and net realisable value. The cost of purchased inventory is determined using the FIFO method. The write down from cost to current replacement cost or net realisable value is recognised in the surplus or defi cit.

NonCurrentAssetsHeldforSale Non current assets held for sale are classifi ed as held for sale if their carrying amount will be recovered principally through the sale transaction rather than through continuing use. Non current assets held for sale are measured at the lower of their carrying amount and fair value less costs to sell. Any impairment losses for writedowns of non current assets held for sale are recognised in the surplus or defi cit. Any increases in fair value (less costs to sell) are recognised up to the level of any impairment losses that have previously been recognised. Non current assets (including those that are part of a disposal group) are not depreciated or amortised while they are classi- fi ed as held for sale. Buller DistrictDistric CouncilCouncil 175

FinancialAssets Buller District Council classifi es its fi nancial assets into the following four categories: Financial assets at fair value through surplus or defi cit; Held-to-maturity investments; Loans and receivables; and Fair value through other comprehensive income. The classifi cation depends on the purpose for which the investments were acquired. Management determines the classifi ca- tion of its investments at initial recognition and re-evaluates this designation at every reporting date. Financial assets and liabilities are initially measured at fair value plus transaction costs unless they are carried at fair value through surplus or defi cit in which case the transaction costs are recognised in surplus or defi cit. Purchases and sales of investments are recognised on trade date, the date on which Buller District Council commits to pur- chase or sell the asset. Financial assets are derecognised when the rights to receive cash fl ows from the fi nancial assets have expired or have been transferred, Buller District Council having transferred substantially all the risks and rewards of ownership. The fair value of fi nancial instruments traded in active markets is based on quoted market prices at the balance sheet date. The quoted market price used is the current bid price. The fair value of fi nancial instruments that are not traded in an active market is determined using valuation techniques. Bull- er District Council uses a variety of methods and makes assumptions that are based on market conditions existing at balance date. Quoted market prices or dealer quotes for similar instruments are used for long-term debt instruments held. Other techniques, such as estimated discounted cash fl ows, are used to determine fair value for the remaining fi nancial instruments.

FinancialAssetsatFairValueThroughSurplusorDeficit This category has two sub-categories: Financial assets held for trading Those designated at fair value through surplus or defi cit at inception. A fi nancial asset is classifi ed in this category if acquired principally for the purpose of selling in the short term or if so desig- nated by management. Derivatives are also categorised as held for trading unless they are designated as hedges. Assets in this category are classifi ed as current assets if they are either held for trading or are expected to be realised within 12 months of the balance sheet date. After initial recognition they are measured at their fair values. Gains or losses on re-measurement are recognised in the surplus or defi cit. Currently Buller District Council recognises derivative fi nancial instruments in this category.

HeldtoMaturityInvestments Held to maturity investments are assets with fi xed or determinable payments and fi xed maturities that Buller District Council has the positive intention and ability to hold to maturity. After initial recognition they are measured at amortised cost using the effective interest method. Gains and losses when the asset is impaired or derecognised are recognised in the surplus or defi cit. Currently Buller District Council does not hold any fi nancial assets in this category.

LoansandReceivables These are non-derivative fi nancial assets with fi xed or determinable payments that are not quoted in an active market. After initial recognition they are measured at amortised cost using the effective interest method. Gains and losses when the asset is impaired or derecognised are recognised in the surplus or defi cit. Loans and receivables are classifi ed as “trade and receivables” and short and long term investments in the Statement of Financial Position. Investments in this category include loans to subsidiaries and other companies and term deposits. 176

FairValueThroughOtherComprehensiveIncome Financial assets at fair value through other comprehensive income are those that are designated into this category at initial recognition or are not classifi ed in any of the other categories above. This category encompasses:

Investments that Buller District Council intends to hold long-term but which may be realised before maturity. Shareholdings that Buller District Council holds for strategic purposes. Buller District Council’s investments in its subsidiary and associate companies are not included in this category as they are held at cost whereas this category is to be measured at fair value. After initial recognition these investments are measured at their fair value. Gains and losses are recognised directly in other comprehensive income except for impairment losses, which are recognised in the surplus or defi cit. Investments in this category include shares in other companies.

ImpairmentofFinancialAssets At each balance sheet date Buller District Council assesses whether there is any objective evidence that a fi nancial asset or group of fi nancial assets is impaired. Any impairment losses are recognised in the surplus or defi cit. Any cumulative losses previously recognised in equity will be removed from equity and shown in the surplus or defi cit.

DerivativeFinancialInstruments Buller District Council uses derivative fi nancial instruments to hedge exposure to interest rate risks arising from fi nancing activities. In accordance with its treasury policy, Buller District Council does not hold or issue derivative fi nancial instruments for trading purposes. However derivatives that do not qualify for hedge accounting are accounted for as trading instruments. Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re- measured at their fair value at each balance date. The gain or loss on re-measurement to fair value is recognised immediately in surplus or defi cit. However, where derivatives qualify for hedge accounting, recognition of any resultant gain or loss depends on the nature of the item being hedged. The fair value of interest rate swaps is the estimated amount that Council would receive or pay to terminate the swap at the balance sheet date, taking into account current interest rates and the current creditworthiness of the swap counterparties. The fair value of forward contracts is their quoted market price at the balance sheet date, being the present value of the quoted forward price. Buller District Council has not adopted hedge accounting to account for its derivative fi nancial instruments.

Buller DistrictDistric CouncilCouncil 177

Property,PlantandEquipment Property, plant and equipment consist of: Council Assets – These include land, buildings, plant and machinery, motor vehicles, offi ce equipment, library books and the Airport runway. Infrastructure Assets – These include roads, footpaths, traffi c facilities, street lights, bridges, culverts, water reticulation, storm water reticulation, sewerage reticulation and landfi ll. Harbour Assets – These include land, buildings, wharves, plant and machinery, offi ce equipment, motor vehicles and harbour vessels. WestReef Assets – These include leasehold improvements, plant and equipment, offi ce equipment, offi ce furniture, fi ttings and computer equipment. Buller Health Trust Assets – These include plant and equipment and furniture and fi ttings. Property, plant and equipment is shown at cost or revaluation, less accumulated depreciation and impairment losses.

Additions The cost of an item of property, plant and equipment is recognised as an asset if, and only if, it is probable that future eco- nomic benefi ts or service potential associated with the item will fl ow to Buller District Council and the cost of the item can be reliably measured. In most instances, an item of property, plant and equipment is recognised at its cost. Where an asset is acquired at no cost, or for a nominal cost, it is recognised at fair value as at the date of acquisition. Gains and losses on disposal are determined by comparing the proceeds with the carrying amount of the asset. Gains and losses on disposal are included in the surplus or defi cit. When revalued assets are sold, the amounts included in asset revalu- ation reserves in respect of those assets are transferred to accumulated funds.

Disposals Gains and losses on disposal are determined by comparing the proceeds with the carrying amount of the asset. Gains and losses on disposal are included in the surplus or defi cit. When revalued assets are sold, the amounts included in asset revalu- ation reserves in respect of those assets are transferred to accumulated funds.

SubsequentCosts Costs incurred subsequent to initial acquisition are capitalised only when it is probable that future economic benefi ts or ser- vice potential associated with the item will fl ow to Buller District Council and the cost of the item can be measured reliably.

Depreciation Depreciation is provided on a straight line basis on all property, plant and equipment, other than land, at rates that will write off the cost (or valuation) of the assets to their estimated residual values over their useful lives. The useful lives and associated depreciation rates of major classes of assets have been estimated as follows:

CouncilAssets Depreciation Rate Useful Life (Years) (%) Motor vehicles 15% 7 Offi ce Equipment 10% to 50% 2 - 5 Plant and machinery 3.33% to 15% 7 - 30 Buildings 1% to 10% 10 - 100 Library Books 10% 10 Airport runway - Basecourse 1.3% 75 - Seal 5% 20 178

InfrastructureAssets Depreciation Rate (%) Useful Life (Years) Roads - Formation Not Depreciated - Basecourse- unsealed roads Not Depreciated - Basecourse – sealed roads 1% to 2% 50 - 100 - Seal 4% to 12.5% 8 - 25 Footpaths - Basecourse Not Depreciated - Pavement 1.25% to 10% 10 - 80 Traffi c facilities 5% to 10% 10 - 20 Street lights 3.33% 30 Bridges 2% to 6.67% 50 - 100 Culverts 1.11% to 1.25% 80 - 90 Water Reticulation - Drains Not depreciated - Kerb and Channelling 1.25% 80 - Pipes 1.10% to 4.10% 25 - 100 - Valves, hydrants 1.67% 60 - Intake structures 1.11% to 2% 50 - 90 - Reservoirs 1.25% 80 - Resource Consents 2.85% 35 - Pump stations 2% to 6.67% 15 - 50 - Treatment Equipment 2% to 6.67% 15 – 50 - Tunnels 0.7% to 4% 25 - 150 Stormwater Reticulation - Pipes 1% to 1.54% 65 - 100 Sewerage Reticulation - Pipes 1% to 1.42% 70 - 100 - Treatment Plants 1.11% to 6.67% 15 - 90 - Pump Stations 1.11% to 6.67% 15 - 90 - Manholes 1.11% 90

HarbourAssets Depreciation Rate Useful Life (Years) (%) Wharves 1.67% 60 Buildings 2.5% 40 Plant and Machinery 3.3% to 10% 10 - 30 Offi ce Equipment 20% to 33.5% 3 - 5 Motor Vehicles 10% to 20% 5 - 10 Harbour Vessels 5% to 6.7% 15 - 20

Buller DistrictDistric CouncilCouncil 179

WestReefServicesLimitedAssets Depreciation Rate Useful Life (Years) (%) Leasehold Improvements 6.5% to 15% 6.7 - 15 Plant and Equipment 5.5% to 40% 2.5 – 18 Vehicles 8% to 29% 3 - 12 Offi ce Equipment 8% to 40% 2.5 - 12.5 Offi ce Furniture and Fittings 8% to 24% 4 - 12.5 Computer Equipment 18% to 36% 3 - 5.5

BullerHealthTrustAssets Depreciation Rate Useful Life (Years) (%) Plant and Equipment 7% to 50% 2 - 10 Furniture and Fittings 7% to 13.5% 7.4 – 14.3 Furniture and fi ttings 16.2% to 48% 2.1 - 6.2 years

Capital work in progress is not depreciated. The total cost of the project is transferred to Property Plant and Equipment on its completion and then depreciated. The residual value and useful life of an asset is reviewed and adjusted if applicable, at each fi nancial year end.

Revaluation Those asset classes that are revalued are valued on a basis described below. All other asset classes are carried at depreciated historical cost. The carrying values of revalued items are reviewed at each balance date to ensure that those values are not materially different to fair value.

Council Land- The Airport land was revalued to fair value as determined by market based evidence by an independent valuer. The most recent valuation was performed by Quotable Value with an effective date as at 30 June 2005. Council land is rec- ognised at deemed cost.

Harbour Land - The Harbour land was revalued to fair value as determined by market based evidence by an independent valuer. The most recent valuation was performed by Quotable Value with an effective date as at 30 June 2005. Harbour land is recognised at deemed cost.

Infrastructural Assets – The infrastructural assets are valued on a three yearly valuation cycle at fair value determined on a depreciated replacement cost basis by an independent valuer. At balance date Buller District Council assesses the carrying values of its infrastructural assets to ensure that they do not differ materially from the assets fair value. The most recent valuation was performed by GHD Limited and the valuation is effective as at 30 June 2012. All infrastructural asset classes carried at valuation were valued. The total value of infrastructural assets valued by GHD Limited on 30 June 2012 was $246,295,000.

AccountingforRevaluation Buller District Council accounts for revaluations of property, plant and equipment on a class of assets basis.

The results of revaluing are credited or debited to an asset revaluation reserve. Where this results in a debit balance in the asset revaluation reserve, this balance is expensed in the surplus or defi cit. Any subsequent increase on revaluation that off-sets a previous decrease in value recognised in the surplus or defi cit, will be recognised fi rst in the surplus or defi cit up to the amount previously expensed, and then credited to the revaluation reserve. 180

IntangibleAssets

Goodwill Goodwill is initially measured at its cost, being the excess of the cost of the acquisition over Buller District Council’s interest in the net fair value of the identifi able assets, liabilities and contingent liabilities. Goodwill on acquisition of subsidiaries is included in intangible assets by applying the purchase method. Goodwill arising in business combinations is not amortised. Instead, goodwill is tested for impairment annually. After initial recognition, Buller District Council measures goodwill at cost less any accumulated impairment losses. An impairment loss recognised for goodwill will not be reversed in any subsequent period. Goodwill is allocated to cash generating units for the purpose of impairment testing. The allocation is made to those cash generating units or groups of cash generating units that are expected to benefi t from the business combination, in which the goodwill arose.

InvestmentProperty Properties leased to third parties under operating leases are classifi ed as investment property unless the property is held to meet service delivery objectives, rather than to earn rentals or for capital appreciation. Investment property is measured initially at cost, including transaction costs. After initial recognition, Buller District Council measures all investment property at fair value as determined annually by an independent valuer. The most recent valuation of investment property was carried out by Darroch Valuations with an effec- tive date as at 30 June 2012. Gains or losses arising from a change in the fair value of investment property are recognised in the surplus or defi cit

ImpairmentofNonFinancialAssets Non-fi nancial assets that have an indefi nite useful life are not subject to amortisation and are tested annually for impair- ment. Assets that have a fi nite useful life are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of the assets fair value less costs to sell and value in use. Value in use is depreciated replacement cost for an asset where the future economic benefi ts or service potential of an asset are not primarily dependent on the assets ability to generate net cash infl ows and where the entity would, if deprived of the asset, replace its remaining future economic benefi ts of service potential. The value in use for cash generating assets is the present value of expected future cash fl ows. If an asset’s carrying amount exceeds its recoverable amount the asset is impaired and the carrying amount is written down to the recoverable amount. For revalued assets the impairment loss is recognised against the revaluation reserve. Where that results in a debit balance in the revaluation reserve, the balance is recognised in the surplus or defi cit. For assets not carried at a revalued amount, the total impairment loss is recognised in the surplus or defi cit. The reversal of an impairment loss on a revalued asset is credited to the revaluation reserve. However, to the extent that an impairment loss was previously recognised in the surplus or defi cit, a reversal of the impairment loss is also recognised in the surplus or defi cit. For assets not carried at a revalued amount (other than goodwill) the reversal of an impairment loss is recognised in the surplus or defi cit.

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EmployeeEntitlements

ShortTermBenefits Employee benefi ts that Buller District Council expects to be settled within 12 months of balance date are measured at nomi- nal values based on accrued entitlements at current rates of pay. These include salaries and wages accrued up to balance date, annual leave earned to, but not yet taken at balance date, retiring and long service leave entitlements expected to be settled within 12 months, and sick leave. Buller District Council recognises a liability for sick leave to the extent that absences in the coming year are expected to be greater than the sick leave entitlements earned in the coming year. The amount is calculated based on the unused sick leave entitlement that can be carried forward at balance date, to the extent that Buller District Council anticipates it will be used by staff to cover future absences. Buller District Council recognises a liability and expense for bonuses where contractually obliged or where there is a past practice that has created a constructive obligation.

LongTermBenefits - Long Service Leave and ReƟ rement Leave Entitlement that are payable beyond 12 months, such as long service leave and retirement gratuities, have been calculated on an actuarial basis. The calculations are based on:

Likely future entitlements accruing to staff, based on years of service, years to entitlement and the likelihood that staff will reach the point of entitlement : and The present value of the estimated future cashfl ows. A discount rate of 5.7%, and a infl ation factor of 2.5% were used. The discount rate is based on the weighted average of Government interest rates for stock with terms to maturity similar to those of the relevant liabilities. The infl ation factor is based on the expected long term increase in remuneration for employees

SuperannuationSchemes - Defi ned ContribuƟ ons Schemes Obligations for contributions to defi ned contribution superannuation schemes are recognised as an expense in the surplus or defi cit as incurred.

Provisions Buller District Council recognises a provision for future expenditure of uncertain amount or timing when there is a present obligation (either legal or constructive) as a result of a past event, it is probable that expenditures will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. Provisions are not recognised for future operating losses.

Provisions are measured at the present value of the expenditures expected to be required to settle the obligation using a pre- tax discount rate that refl ects current market assessments of the time value of money and the risks specifi c to the obligation. The increase in the provision due to the passage of time is recognised as an interest expense.

Borrowings Borrowings are initially recognised at their fair value. After initial recognition, all borrowings are measured at amortised cost using the effective interest method. 182

Equity Equity is the communities interest in Buller District Council and is measured as the difference between total assets and total liabilities. Equity is disaggregated and classifi ed into a number of reserves. The components of equity are: Retained earnings; Restricted reserves; and Asset revaluation reserve.

GoodsandServicesTax(GST) All items in the fi nancial statements are stated exclusive of GST, except for receivables and payables, which are stated on a GST inclusive basis. Where GST is not recoverable as input tax then it is recognised as part of the related asset or expense. The net amount of GST recoverable from, or payable to, the Inland Revenue Department (IRD) is included as part of receiva- bles or payables in the Statement of Financial Position. The net GST paid to, or received from the IRD, including the GST relating to investing and fi nancing activities, is classifi ed as an operating cash fl ow in the statement of cash fl ows. Commitments and contingencies are disclosed exclusive of GST.

BudgetFigures The budget fi gures are those approved by the Council at the beginning of the year in the Annual Plan. The budget fi gures have been prepared in accordance with NZ IFRS, using accounting policies that are consistent with those adopted by Buller District Council for the preparation of the fi nancial statements.

CostAllocation Buller District Council has derived the cost of service for each signifi cant activity using the cost allocation system outlined below. Direct costs are those costs directly attributable to a signifi cant activity. Indirect costs are those costs, which cannot be identifi ed in an economically feasible manner, with a specifi c signifi cant activity. Direct costs are charged directly to signifi cant activities. Indirect costs are charged to signifi cant activities using an appropri- ate cost driver.

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CriticalAccountingEstimatesandAssumptions In preparing these fi nancial statements Buller District Council has made estimates and assumptions concerning the future. These estimates and assumptions may differ from the subsequent actual results. Estimates and judgments are continually evaluated and are based on historical experience and other factors, including expectations or future events that are believed to be reasonable under the circumstances. The estimates and assumptions that form a signifi cant risk of causing a material adjustment to the carrying amount of assets and liabilities within the next fi nancial year are discussed below:

LandfillAftercareProvision The Landfi ll Aftercare Provision Note discloses an analysis of the exposure of Buller District Council in relation to estimates and uncertainties surrounding the landfi ll aftercare provision.

InfrastructuralAssets There are a number of assumptions and estimates used when performing valuations over infrastructural assets which include: The physical deterioration and condition of an asset, eg Council could be carrying an asset at an amount that does not refl ect its actual condition. This is particularly so for those assets which are not visible such as stormwater, wastewater and water supply pipes that are underground. The risk is minimised by Council performing a combination of physical inspections and condition modelling assessments of underground assets; Estimating any obsolescence or surplus capacity of an asset; and Estimates are made when determining the remaining useful lives over which the asset will be depreciated. These estimates can be impacted by local conditions, eg weather patterns and traffi c growth. If useful lives do not refl ect the actual consumption of the benefi ts of the asset, then Council could be over or under estimating the annual depre- ciation charge recognised as an expense in the surplus or defi cit. To minimize the risk, Council’s infrastructural asset useful lives have been determined with reference to the NZ Infrastructure Asset Valuation and Depreciation Guidelines published by the National Asset Management Steering Group, and have been adjusted for local conditions based on past experience. Asset inspections, deterioration and condition modeling are also carried out regularly as part of Council’s Asset management planning activities, which gives Council further assurance over its useful Experienced independent valuers prepare Council’s infrastructural asset revaluations. The last valuation was prepared by GHD Limited on 30 June 2012.

StandardsandInterpretationsNotYetAdopted Standards, amendments, and interpretations but not yet effective that have not been early adopted, and which are relevant to the Council and group, are:

NZ IFRS 9 Financial Instruments will eventually replace NZ IAS 39 Financial Instruments: Recognition and Measurement. NZ IAS 39 is being replaced through the following 3 mainphases: - Phase 1 Classifi cation and Measurement - Phase 2 Impairment Methodology, - Phase 3 Hedge Accounting Phase 1 on the classifi cation and measurement of fi nancial assets has been completed and has been published in the new fi nancial instrument standard NZ IFRS 9. NZ IFRS9 uses a single approach to determine whether a fi nancial asset is meas- ured at amortised cost or fair value, replacing the many different rules in NZ IAS 39. The approach in NZ IFRS 9 is based on how an entity manages its fi nancial instruments (its business model) and the contractual cash fl ow characteristics of the fi nancial assets. The new standard also requires a single impairment method to be used, replacing the many different impairment methods in NZ IAS 39. The new standard is required to be adopted for the year ended 30 June 2014. Buller District Council has not yet assessed the effect of the new standard and expects it will not be early adopted.

The Minister of Commerce has approved a new Accounting Standards Framework (incorporating a Tier Strategy) developed by the External Reporting Board (XRB). Under this Accounting Standards Framework, the Council is classifi ed as a Tier 1 reporting entity and it will be required to apply full Public Benefi t Entity Accounting Standards (PAS). These standards are being developed by the XRB based on current International Public Sector Accounting Standards. The effective date for the new standards for public sector entities is expected to be for reporting periods beginning on or after 1 July 2014. This means the Council expects to transition to the new standards in preparing its 30 June 2015 fi nancial statements. As the PAS are still under development, the Council is unable to assess the implications of the new Accounting Standards Framework at this time. Due to the change in the Accounting Standards Framework for public benefi t entities, it is expected that all new NZ IFRS and amendments to existing NZ IFRS will not be applicable to public benefi t entities. Therefore, the XRB has effectively frozen the fi nancial reporting requirements for public benefi t entities up until the new Accounting Standard Framework is effective. Accordingly, no disclosure has been made about new or amended NZ IFRS that exclude public benefi t entities from their scope. Buller District Council 185 Audit Report

Independent Auditor’s Report

To the readers of Buller District Council and group’s annual report for the year ended 30 June 2012

The Auditor-General is the auditor of Buller District Council (the District Council) and group. The Auditor-General has appointed me, Scott Tobin, using the staff and resources of Audit New Zealand, to carry out the audit of the financial statements, non-financial performance information and other information required by schedule 10 of the Local Government Act 2002 (other information) of the District Council and group on her behalf.

We have audited: x the financial statements of the District Council and group on pages 113 to 183, that comprise the statement of financial position as at 30 June 2012, the statement of comprehensive income, statement of changes in equity and statement of cash flows for the year ended on that date and the notes to the financial statements that include accounting policies, explanatory information and particular information required by schedule 10 of the Local Government Act 2002; and x the non-financial performance information of the District Council and group on pages 31 to 112 that includes particular information required by schedule 10 of the Local Government Act 2002. x the other information that comprises the statement of compliance and responsibility and consultation with Maori on pages 15 and 29. Opinion on the financial statements, non-financial performance information and other information

In our opinion: x The financial statements of the District Council and group on pages 113 to 183:

{ comply with generally accepted accounting practice in New Zealand; and

{ fairly reflect:

x the District Council and group’s financial position as at 30 June 2012; and

x the results of its operations and cash flows for the year ended on that date. x The non-financial performance information of the District Council and group on pages 31 to 112:

{ complies with generally accepted accounting practice in New Zealand; and 186

{ fairly reflects the District Council and group’s levels of service for the year ended 30 June 2012, including:

x the levels of service as measured against the intended levels of service adopted in the long-term council community plan; and

x the reasons for any significant variances between the actual service and the expected service.

x The other information of the District Council and group in the financial statements and the non-financial performance information and on page 15 and 29 under the headings statement of compliance and responsibility and consultation with Maori, complies with the requirements of Schedule 10 of the Local Government Act 2002 applicable to the annual report and fairly reflects the required information.

Our audit was completed on 31 October 2012. This is the date at which our opinion is expressed.

The basis of our opinion is explained below. In addition, we outline the responsibilities of the Council and our responsibilities, and explain our independence. Basis of opinion

We carried out our audit in accordance with the Auditor-General’s Auditing Standards, which incorporate the International Standards on Auditing (New Zealand). Those standards require that we comply with ethical requirements and plan and carry out our audit to obtain reasonable assurance about whether the financial statements, non-financial performance information and other information are free from material misstatement.

Material misstatements are differences or omissions of amounts and disclosures that would affect a reader’s overall understanding of the financial statements, non-financial performance information and other information. If we had found material misstatements that were not corrected, we would have referred to them in our opinion.

An audit involves carrying out procedures to obtain audit evidence about the amounts and disclosures in the financial statements, non-financial performance information and other information. The procedures selected depend on our judgement, including our assessment of risks of material misstatement of the financial statements, non-financial performance information and other information whether due to fraud or error. In making those risk assessments, we consider internal control relevant to the preparation of the District Council and group’s financial statements, non-financial performance information and other information that fairly reflect the matters to which they relate. We consider internal control in order to design audit procedures that are appropriate in the circumstances but not for the purpose of expressing an opinion on the effectiveness of the District Council and group’s internal control.

An audit also involves evaluating:

x the appropriateness of accounting policies used and whether they have been consistently applied;

x the reasonableness of the significant accounting estimates and judgements made by the Council;

x the adequacy of all disclosures in the financial statements, non-financial performance information and other information;

Buller District Council 187

x determining the appropriateness of the reported non-financial performance information within the Council’s framework for reporting performance; and x the overall presentation of the financial statements, non-financial performance information and other information.

We did not examine every transaction, nor do we guarantee complete accuracy of the financial statements, non-financial performance information and other information. We have obtained all the information and explanations we have required and we believe we have obtained sufficient and appropriate audit evidence to provide a basis for our audit opinion. Responsibilities of the Council

The Council is responsible for preparing: x financial statements and non-financial performance information that:

{ comply with generally accepted accounting practice in New Zealand;

{ fairly reflect the District Council and group’s financial position, financial performance and cash flows;

{ fairly reflect its service performance, including achievements compared to its forecast; and x other information in accordance with Schedule 10 of the Local Government Act 2002 that fairly reflects the required information.

The Council is responsible for such internal control as it determines is necessary to enable the preparation of financial statements, non-financial performance information and other information that are free from material misstatement, whether due to fraud or error.

The Council’s responsibilities arise from the Local Government Act 2002. Responsibilities of the Auditor

We are responsible for expressing an independent opinion on the financial statements, non-financial performance information and other information and reporting that opinion to you based on our audit. Our responsibility arises from section 15 of the Public Audit Act 2001 and section 99 of the Local Government Act 2002. Independence

When carrying out the audit, we followed the independence requirements of the Auditor-General, which incorporate the independence requirements of the New Zealand Institute of Chartered Accountants. 188

Other than the audit and carrying out the audit of the long term plan, we have no relationship with or interests in the District Council or any of its subsidiaries.

Scott Tobin Audit New Zealand On behalf of the Auditor-General Christchurch, New Zealand

Buller District Council

OnlineVersion: save on both cost and environmental impact, this report has been To created with online viewing in mind. Only a limited number of the printed version have been produced. www.bullerdc.govt.nz

2011/2012AnnualReport Buller District Council