Kaikōura is better placed than most districts when it comes to the cost of renewing old pipes and roads - largely because of the 2016 earthquake, a council report says.
Kaikoura council's annual costs will be stable and less than depreciation for at least 20 years, in stark contrast to other local authorities facing huge capital spends. Photo: 123RF
Kaikōura District Council staff have been working on an infrastructure strategy for the next 30 years as part of the long-term plan process.
Many councils have failed to make adequate plans to renew their ageing water and sewerage systems or assets like roads and bridges and the government now requires them to look ahead at what needs to be done, and how they will fund it.
The Kaikōura council has concluded that its infrastructure costs will rise over the next three years, to pay for a backlog of road and pavement renewals, and the construction of the new Clarence River bridge.
After that the council's annual costs will be stable and below depreciation for at least 20 years, in stark contrast to other local authorities facing huge capital spends over the same period.
Council operations manager Dave Clibbery said there were three reasons for that.
Kaikōura's water and roading assets were built later than in many other districts and have a longer life ahead of them.
The rebuild works following the 2016 earthquake have replaced or upgraded many of the assets, especially the older more vulnerable ones.
The oldest water mains in Kaikōura from the 1920s have all been replaced, and most of the other pipe infrastructure from the late 1950s and late 1980s is middle-aged, with no significant problems.
With a stable population there is no looming need to increase the capacity of those assets.
The council's roads, water and sewerage networks accounted for 95 percent of its total assets and were the key to future financial requirements, Clibbery said.
"This profile strongly suggests that if council manages these assets appropriately (in particular not deferring renewals) that it should be affordable for the community during this period."
This did not support previous suggestions that Kaikōura District Council was unsustainable, even in the relatively long term, Clibbery said.
One challenge the council faced was obtaining good value for money for major infrastructural works because they were small by local authority standards.
"The relative isolation of the district also has the potential to diminish competition and inflate costs. These are fundamental challenges that are not easily overcome."
A provisional budget allocation of $2 million has been provided in 2042 to support universal water metering of the community and possibly the development of a new water source for Kaikōura if that was needed to support growth.
While infrastructure costs would generally be stable for the next three decades, challenges lay to lie ahead for future generations, Clibbery said.
An intense period of replacements was likely to begin in around 40 years' time.
"A prudent management strategy might therefore include building of significant (financial) reserves in the period prior to these peaks, but it is recognised that this need is far in the future and that many other factors might change in the interim," Clibbery said.
The infrastructure strategy was adopted by unanimous vote and now becomes part of the KDC's proposed long-term plan.
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