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Dam Lies Coming Home To Roost

27/07/2025

Dam on shaky ground

The Waimea Irrigation (Community) Dam has both the Tasman District Council and Irrigators begging for a hand out from the Government.

Dam on shaky ground

The once claimed “P95” $76 million dam as consulted on with the Tasman District was supposed to have a 95% guarantee of coming on or under budget (according to staff). The later revised budget of $104 million after early contractor engagement was supposed to be “as good as a fixed price dam” according to the Council head of Engineering Richard Kirby. And when queried about the lack of contingency budget Council CFO Mike Drummond assured Council that there was so little of the dam that wasn’t fixed price that the actual contingency figure was more like 30%.

With the dam reaching completion in excess of $200 million, these empty statements and assurances have left the community reeling in the wake of sky rocketing costs. The actual figure of the dam final costs has been well under reported with sunk costs that were supposed to be part of the figure lost along the way. There was originally budgeted for facility for power generation to be added on, also lost along the way. The costs of numerous renegotiation as the price escalated all worn by the rate payer in the form of “overheads” also not part of the announced final figure. Added to that the sky rocketing running costs of the dam leaving a sour taste and increased pressure on rates and water affiliation.

The claimed difficulty in selling extra shares was an issue that was always going to rear its ugly head. The general ratepayers already picked up a number of those extra shares as the initial boast by irrigators was deemed a little unrealistic as some of the land originally included was uphill and would require a new irrigation scheme to give the land owners access to the increased water. Without accounting for the ever increasing pressure for more housing; boosted by Government mandates for Councils to keep supplying available zoned land. The remaining land needing to become involved in the share uptake would require the current owners to change farming practices for it to be affordable even at the originally quoted prices. Perhaps some of the larger shareholders were hoping to buy out all those not participating?

Ironically, a number of the larger shareholders have already sold out, even from those seen laughing and congratulating each other in the video linked in the above article. It makes one wonder if all those stories told during the dam deliberations about generational farming etc were not just more lies and the real aim of the project was just to get their names on a dam?

Unfortunately, for those left trying to farm and live in a region drowning in debt the consequences are a little more dire.

As this goes to print the Tasman District is struggling to recover from two significant weather events in the past fortnight and yet another one potentially looming in the coming week. Unfortunately, a lot of land owners near rivers and water ways have suffered significant damage. The cost of exorbitant rates and water charges leaves little spare for rebuilding flood damage.

The general rate payer fares even worse following the weather events because Tasman District Council in an effort to keep rates affordable in the recent annual plan round had to cut doggy doo bags and halve the amount of road sweeping done. One can only imagine how fixing rivers and roads across the region will fit into rate allocation if they were already scraping the barrel that low. Not to mention the loss of Council owned forestry income (that was supposedly ear marked for dam loan repayments) suffered as a result of windfall during the storms.

Nominations for the next term of Council are due to close in the coming week. Those elected will be on a hiding to nothing as recovery from the Kempthorne, King, Bryant dynasty will take a generation at best. That is assuming we get a change of leadership and direction within Council. Rubber stamping, woke, and agenda driven politics need to be kicked out. If we have any hope of recovery in the Tasman District we will need to return to doing the basics and doing them well. Lets see if the region is ready for change or if we will vote in the final chapter of the District as an independent entity.

Filed Under: Dam, Spending, Vote For Change, Your Say Tagged With: dam overruns, Debt, Tasman District Council, Waimea Community Dam, Waimea dam

Tick Tock Tick Tock The Dam and The Clock

23/10/2023

waimea dam clock ticking

Summer is fast approaching and according to the NZ Herald “There’s now also a good chance the long-anticipated climate system – which could be formally declared within weeks – will sit among the strongest El Niños seen in the past 80 years, with officials already warning of fire danger and a heightened risk of drought.”

the Waimea Dam clock is ticking

So, it is a good job that the $200 million dam (give or take – as the final bill is yet to be presented) is on track to provide much needed water to the Waimea Plains and surrounding homes and businesses. At least that was the last we heard from the dam construction CEO Mike Scott.

Perhaps in an ordinary year it wouldn’t be such an issue if the dam wasn’t completed as indicated but this is no ordinary year. Not only do we have the impending threat of an El Niños weather pattern bringing a particularly dry summer, but we also have a district facing financial ruin without any added stresses.

The Government’s best attempts to bankrupt the country have very nearly succeeded. Covid lock-downs, excessive taxes and added costs, high wages and reduced work forces, out of the park inflation accompanied by the hiking interest rates to control it, all add up to many in the primary industry sector relying on a bumper crop to keep afloat. Without the added costs added by a Council equally drunk on spending other people’s money.

Now imagine the unthinkable: that $200 million (give or take) spent on dam insurance for such a time as this comes up short.

Clearly there has been no indication from Mike Scott that there are any issues to concern us. Council has been equally silent. Or have they?

Tasman District Council water conservation warning

It seems odd that the Council is issuing conserve water adverts. The dam that was supposed to provide 100 years water security, included massive provisions for growth in our urban communities. In fact, not only did we buy enough security for expected “high growth” figures for our district, but when the irrigators first began pulling back on their commitments the Council bought up extra shares in the dam. So with all this extra capacity up our sleeve in year one of the dam operation we should be swimming in water. And yet the message is inconsistent with this position.

Possibly, the Council are just being prudent in case the predicted drought turns out to be the mother of all droughts and exceeds the copious growth buffer that we bought. Because once operating at full growth capacity the dam only provides security for a one in sixty year drought. An extreme drought will still evoke water restrictions in that scenario.

Possibly, the dam is not fully functioning as indicated. We have history that would indicate the rate-payer has been grossly mislead before. For instance, the dam had a P95 at $76 million; the dam was “as good as fixed price” at $104 million; they had found bedrock – better than expected in some places.

One thing is for certain: the clock is ticking. And time is a great revealer of sins and lies.

When the dam was at a mere $158 million I made a predictive statement based on the evidence presented to me. Tick Tock Tick Tock.

Filed Under: Dam, Your Say Tagged With: Waimea Community Dam, Waimea dam, water

Waimea Irrigation Dam or Waimea Community Bridge

18/12/2022

dam or bridge

The hundred million dollar question is “Will the Waimea Dam hold water or have we built a $200 million bridge?”

dam or bridge

In the December 2022 update Mike Scott CEO of Waimea Water, the dam construction company, tells us that we are still on budget but the budget is being stressed by various items such as the cost of the Mechanical & Engineering components that were never designed or priced in the original quote. Makes you wonder how we ever had a “P95” guarantee doesn’t it?

However, this has also been the story told to Council in the past. We are on budget but there are pressures. Nek Minnut a $30 million blow out. Never saw that coming! Not the first time, not the second time, not the third time. And yet here we are $195 million versus the P95 price of $76 million.

The dam is now about 84% complete as compared to the 75% complete at the last two updates. Because it 75% complete in the first update early in 2022 and then again 75% complete in the mid year update we discovered that the update percentage figure is tagged to the timeline and not the amount of work done. So, because the completion timeline was pushed out in the midyear update the percentage completed remained the same. We have now revisited the practical completion date, bringing it forward some months so the percentage completed jumps up accordingly. Who knows what percentage of the actual work has been completed between updates because we don’t measure that metric apparently.

What is more pertinent to the question that we should all be wanting an answer to (Will it hold water?) was Mr Bedrock-everywhere Scott’s comments around the grouting. Of course, most of the Councillors had no concerns at all in this regard, and were busy patting themselves and others on the back for doing such a great job to get this far.

Will all this work be in vain?

In answer to Councillor Walker’s question Mr Scott explains that the grout curtain seals substrata and stops leakage under the dam. It is a process where we drill 44 meters down into the substrata and pump concrete into the holes sealing up all the leaks. We budgeted for 5000 meters of drilling and now have completed 17000 meters of drilling which is much more than originally budgeted.

When Councillor Walker asked for clarification that they are drilling down to bedrock Mr Scott replied “No.” When then asked how far they drill he responds.”it is through the rock, all rock has permeability. The deeper you go down the longer the path so there is less flow so the grout curtain is deepest at the deepest part of the reservoir and it is through rock sealing up .. sealing .. or reducing the permeability of the rock.”

Councillor Greening followed up Councillor Walker’s questions with “In the past when you have spoken about grouting you have explained it in terms of drilling down to bedrock. Have we drilled down to bedrock given that was best practice or have we not drilled to bedrock and stopped at 44 meters?”

Mr Scott responded “Drilled through bedrock The dam is built on rock, we have cleared the overburden and got down to sufficiently strong bedrock to found the dam, drilled down through the bedr… through the rock up to 44 meters deep to reduce the permeability of that rock.”

Again, Councillor Greening sought clarification “we have got grout holes drilled down to bedrock and through bedrock is what you are saying?”)” And got the response “Through the rock that is right.”

One more attempt from Councillor Greening for a direct answer “through bedrock? draws yet another blank with Scott’s “yeah through yeah through founding rock” answer.

So what did we learn from that exchange? We learned that their initial site investigative work suggested that they would need to drill 5000 meters of grout holes. Once they started they decided that they needed to drill 17000 meters (up to 44 meters deep) of grouting. What we weren’t told is whether they believe they have now sealed the reservoir or whether they stopped due to budget or other constraints (such as still no sign of solid rock at 44 meters).

Mr Scott’s dancing around the answer of are they in solid bedrock with yes bedrock/rock/all rock is permeable/founding rock could be a confirmation of the word on the street that some of the holes were seemingly bottomless soft rock/clay. Possibly the result of building a dam on a fault line – sorry, according to Mr Kirby Council Head Engineer it is just a convergence of “shear zones” running through the dam site.

The stumbling Mr Scott did around the grouting “sealing up .. sealing … or reducing the permeability” also suggest that he was reluctant to say that the grouting to date was a success at sealing the reservoir floor, or sealing it sufficiently that we have a dam and not a bridge.

(sorry mostly sound .. skip to 40 seconds to hear start)

One thing is very clear, and that is that the initial dam site examination was woefully inadequate. If we examine Mr Scott’s comments in light of studies about dams we find that not only was the site selection particularly bad, but the investigation into the site was woeful, and now there questions over the construction process. But don’t take my word for it, lets have a look at some instances.

Our findings show that bedrock permeability is a higher-order control on flow path distribution across catchment scales, and hence on MTT scaling relationships. This is particularly significant as more and more researchers are finding that bedrock groundwater makes significant contributions to streamflow in catchments where the bedrock was previously thought to be impermeable [Gabrielli et al., 2012].
Source

This extract highlights that even “bedrock” can be more permeable than first thought, agreeing with Scott’s assertion that all rock is permeable. However, as he was reluctant to be committed to the term “bedrock” we are left questioning what kind of rock the dam is built on and where exactly it sits on the scale of permeability.

There are two main types of porosity: intergranular porosity that characterizes sands, gravels and mud, and fracture porosity in hard rock. Fracture porosity forms during brittle failure of hard rock or cooling of lava flows. Fracture networks that are connected can provide pathways for fluid flow even when the host rock is impervious (e.g. granite, basalt, indurated sandstone). Highly productive aquifers are not uncommon in fractured bedrock.
Source

Here we discover that “highly productive aquifers are not uncommon in fractured bedrock.” One would be “very surprised” to learn that there are highly productive aquifers under a dam site located between to major fault lines and sitting on yet another convergence of sheer zones! Doesn’t sound like a place you find fractured bedrock at best to me.

Fracturing of the rock commonly accompanies faulting, and a fault may be marked by a zone of fracturing rather than by a single fracture. Faults and the fracturing that accompanies them also afford avenues by which surface weathering and solution activity can attack the rock. Fault zones present a possible escape route for the reservoir water, and faults also indicate, in varying degree, the hazard of continued or repeated movement.Faults in the foundation and abutment rocks at a dam site and in a reservoir area introduce problems of bearing strength, stability, and water-tightness and, therefore, sites that contain them should be avoided. Stable dams can be designed for faulted foundations, but the cost of the necessary remedial treatment may be prohibitive.
Source

“Sites that should be avoided” if this was a dictionary entry I would suggest that the Waimea Irrigation Dam site would be the explanation following it. Not only can we expect a leaky reservoir, we can expect that there is likely to be further movements adding to our woes for years to come (should the dam be completed) and of course the remedial work might be prohibitive were it not for the fact that there is no off-ramp for this council. We must have the Kempthorne/King/Bryant/Mailing memorial no matter what.

Conclusions Monitoring of seismic activity
• Prior to construction,
• During impounding of reservoir, and
• During first years of reservoir operation is highly recommended for (i) large storage dams, and (ii) dams located in tectonically stressed regions.
Source

I found this comment particularly chilling. I don’t think there is any dispute that we have a dam located in a tectonically stressed region (in fact I would suggest we are right on top of a fault line), so have we been monitoring seismic activity at the dam site before, during, and looking ahead into the future?
As the article goes on to explain below, the pressure exerted by the reservoir water has the potential to create seismic events, especially in a site already loaded with shear zones and weak rock. This is important because any failure of the grout curtain, assuming it works in the first instance, could well see a failure of the dam by way of erosion of the foundation. I mean what are the chances of an earthquake cracking an unreinforced concrete grout curtain places on a fault line?

The statistics of dam failures performed by ICOLD [8] takes into account dams 15 m high or more or with a storage volume of at least 1 million of cubic metres. The results of this work can be summarized as follows (data from China and the URSS were not considered): the most common type of failure in earth and rockfill dams is overtopping (31% as a primary cause, 18% as a secondary cause), followed by internal erosion of the body (15% as a primary cause, 13% as a secondary cause), and in the foundation (12% as a primary cause, 5% as a secondary cause) ,,,
Failures leading to catastrophic consequences occur typically at first filling and full reservoir stage, although overtopping during construction has caused, in some cases (for example Panshet dam in India, Sempor dam in Indonesia and S. Tomas dam in Philippines), several victims.

A dam [38] radically alters the natural antecedent state of stress in the valley flanks and river channel; it adds weight, a more or less concentrated vertical load resulting in a complex compression and shear forces in the foundation. It transmits forces caused by loading during its operational life (water load, temperature effects, etc.). These forces produce compression, shear and often upstream tensile stresses. Water seeps into pores and rock discontinuities of the foundation; seepage forces can be considerably high and act in extremely unfavourable direction for stability of dams. The main steps of stability analysis of such a complex structure made up of rock mass and concrete structure consists of the definition of the possible modes of failure and calculation of the equilibrium conditions for stability. Geological and rock mechanical studies are required to evaluate the possible modes of failure and the variables of the problems. Analytical or numerical methods are used to assess dam foundation stability conditions.
4.1 Geological and rock mechanics studies
Geological studies with field explorations help to determine the feasibility of a dam and decide the general layout of the works including dam type and position. The first geological work [38] is to outline the regional and thereby the site structure, then the genesis and history of rocks and hence their stratigraphic, petrographic and tectonic descriptions which indicate the type of the problem to be expected. High-scale hydrographic and hydrogeological studies are required since a dam construction determines the presence of a new water reservoir which changes the original superficial and underground water flow. The principal purpose of rock mechanics studies is the characterization of the rock mass hosting the dam in order to assess deformation and strength features and to evaluate the geometrical and physical properties of singular and systematic rock discontinuities.

Filed Under: Dam, Your Say Tagged With: dam overruns, Waimea Community Dam, Waimea dam

3 Waters Reform and More

04/10/2021

Water continues to cause concern around the region. I have had some 500 emails calling for our Council to reject the Government’s Three Waters reform package. Oddly, not a single email in support.

Incidentally, I use the term Three Waters rather than Three Water as someone pointed out would be more linguistically correct, because that is the term Government use. I am no linguist to debate the rights and wrongs of it.

Around the country we have had Councils vocalising concern over the honourable Mahuta’s reform. Hawkes Bay Mayor’s want to keep the reform in-house. Most of the South Island Mayors have been consistent with the view that it is not currently something that will work for them

In fact some Christchurch Councillors have called for the resignation of the honourable Mahuta

Unlike Nelson City Council, that had a Mayor and a CEO on the working party for the 3 Waters Reform, Tasman voted to send a message that we were unlikely to support the reform in its current form.

What is wrong with where Minister Mahuta is taking the reform?

Firstly, we have to ask if New Zealanders want gold plated 3 Waters systems. Or are we mostly happy with the provision of water that sometimes has a pipe burst, or very occasionally (like once in my lifetime) may put people’s health at risk. Yes, there are places that haven’t delivered as well as they could have, and we can all do better. But would you rather that or a gold plated solution that only the elite few can afford to drink from or flush away?

That is the first question that should have been consulted on. Because when we look at the satisfaction survey that Tasman polls the ratepayers with the overall satisfaction of our water supply service is 86% our Wastewater is at 98% and our Storm water is at 93% positive satisfaction levels.

The next issue with the 3 Water Reform is that it is delivering on the Government’s He Paupau agenda, which is something that was never campaigned on and certainly never consulted on. It will see the Maori interests gain a 50% and controlling share (as a 75% majority of stakeholders is required for a decision) of the Governance of all future 3 Water delivery.

Just like all New Zealanders, Maori have contributed to the establishment of the current Council controlled infrastructure. Just like all New Zealanders they have a say in who is elected to Council and like all New Zealanders can run for Council. In recent years they have had even more say as Council has to consult with Iwi (usually prior to the general ratepayer consultation) over any significant decision. But now, we are told that half the board members of the new entities controlling the 3 Waters will be Iwi appointed. Some have suggested that this is not democracy as their representation far out-ways their population.

Representation in the new entities is sparse enough for the general ratepayer without race based representation. It is likely that the three Council’s in the top of the South Island would have one appointed (non-elected) representative between them. Good luck getting a hold of them to pitch your case on a local issue, and then seeing how much voice they have at the next board meeting.

Centralisation will lead to a greater example of what we have now. With only so much budget, and so many staff hours, decisions will have to be made on how to best spend their money. Obviously, they will start with projects that deliver the most bang for buck – that is that which benefits the greatest number of people. In our case that would most likely be addressing the woeful Wellington water situation, just as Richmond currently gets projects brought forward with regular monotony because of the great gains we can make by combining projects or working with developers (sorry Tapawera, Murchsion, Ngatimoti, Collingwood).

Deliverability of the gold plated 3 Waters package is about as likely as Kiwi Build providing 10 000 new houses, or Auckland getting light rail or a harbour cycle bridge, or Ardern reducing child poverty (as something she did campaign on). There is physically not the availability of engineers or contractors in the Country to deliver the reform in any kind of timely manner.

And all of that would depend on someone funding the work. Some suggest that the new entities should be paying market rates for the infrastructure. I have news for you, they have no money, they just have an ability to borrow money – you the water user will be paying for the purchase and all the horrendous amounts of interest generated from the borrowing to pay you the ratepayer for the assets. On top of that the huge debt that will be racked up to upgrade the services to a gold plated standard.

Even more scary would be the thought that the Council whom have dug us into the best part of a $300 million hole would be given a large portion of the money back to lose it all over again! Meanwhile you are liable for both amounts.

Finally, let us also speak of the fact that NONE of the models we are basing the 3 Waters reform on have a 3 Water system. At best they have a 2 Water system that excludes Storm Water. The Storm Water component from the Government showed a complete lack of understanding of how it would work in the draft workings presented to Council to date. Many of our Storm Water infrastructures are currently managed in the Parks and Reserves space, others are connected to the roading network, and many flow paths are designations across private property.

There is nothing about another level of bureaucracy that screams efficiency and better levels of service or better delivery. As one of the emails submitted by a high ranking local fire officer suggests, when FENZ was created under the auspices of greater efficiency we have actually ended up with 50% cost increases and, at best, no improvement of service over the old rural and urban fire brigade system.

However, the 3 Waters Reform is just one of the many examples of your rights being diminished by this Government. The honourable Boyack took great pleasure in informing Councillors in attendance at a recent Resource Management Act reform workshop about how NIMBYs would no longer halt progress on the grounds of loss of “amenity” values. The new Act has no provision at all for amenity. Amenity being things that you value about where you live, like peace and quiet, nice views, village feel and the like.


Again, good luck getting local views represented by the new system of appointed commissioners hearing all plan changes and subdivision consents etc.

Many other rights are being stripped from you as you read this. Some under the banner of COVID response, others just because we can, most from agenda’s that were never campaigned on much less consulted on.

Tasman District Council is also definitely experiencing a lot of positive change this term. ███████ ██████████████████████████████████████████████████████████████████████████████████████████████████████████████████████████████████████████████████████████████████████████████████████████████████

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When I questioned how we could fill a position without the budget to pay them (it was apparently in the LTP) which I pointed out had not been signed off, I was told if they had to they would accommodate it within the existing management budget. At the time, I questioned how the budget could have that much fat in it, but was assured it would be accommodated.


Fast forward a few months and we get a report stating that the “Corporate overhead activity had a deficit of $152, 000” which includes Coporate, Finance, Operational Governance, Property, Office Overheads, Human Resources, Project Management Office, and Executive.

So in the handful of months since signing off on the LTP our governance budget has gone from having enough money to fund a deputy CEO from existing budgets, to being $152, 000 over the new budget. Given that I am sure the deputy CEO is on a remuneration that is likely well North of $200, 000,especially if you also take into account the staff that are needed to assist the new position, then we have managed to “lose” more than $350 000 in a few months.

We are told that the Project Management is largely to blame for the deficit and that much of it will be recouped by the time the Government’s spending up on projects with unspent COVID funds from the first round is completed. What they aren’t telling us is how much unattributed money the dam is costing us. We consistently have numerous staff working on dam related matters that is billed as “overheads” and are not tagged as dam related. This will only dramatically increase if 3 Waters negotiations are required.

Do not forget that we also have a need to house our ever increasing staff numbers. Despite the CEO telling me that the move of a number of staff to the office above the mall was a temporary measure and they would shrink back to the Council building once renovations were carried out it was only a few months later that we were told we needed even more staff space. After I insisted that we have a proper review of the situation it was decided nothing short of a complete rebuild or new building would suffice.

Even knowing this they refused to allocate any budget in the LTP and the auditor turned a blind eye to the glaring deficit in funding required in the next ten years ( I pointed it out to him twice).

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With Mike Scott, CEO of the dam company, further reminding us that they at the “upper limits” of the previous cost blow out contingencies on a dam far from complete the pressure on rates is going to be extremely uncomfortable for many. Some in Council are hanging their hat on the 3 water reforms by the Government going to be the golden ticket to solve all our money problems. I hear from members of the community that some Councillors and staff think it is as good as a done deal and they have already spent the Government’s windfall. The deputy Mayor thinks that debt won’t be a problem because of the 2% interest rates that are going to continue for the next ten years.

I pity all those loading themselves up with huge debt in the current housing market to get into their first home. Especially those in this region. A more-of-the-same Council has no intention of keeping your rates down.

Filed Under: Dam, Spending, Water, Your Say Tagged With: 3 waters, spending, Tasman District Council

The Long and Short of it

17/07/2021

Tasman District Council has locked in the new Long Term Plan (LTP) for the next ten years (reviewed in 3 years). It locks you in to more debt and more rate increases, which is interesting given that I ran against a deputy mayor with twenty years experience who publicly stated he believed he would keep us within the $200million debt cap and 3% rate increases. At the time, I said I didn’t see how we could given that the dam was still blowing out (as it still is) and the costs associated with pending Government reviews such as the three waters.

That is not the only time that I challenged fiscal wherewithal of our current leadership. I challenged the continued un-budgeted spending that this Council was approving early in the term when COVID was rearing its ugly head around the world. I was told by the Mayor that this council was “well informed of the likely impact of COVID.” Two weeks later the country was in level 4 lock down and a couple of weeks after that we were passing a zero percent rate increase for the year. If our leadership were so well informed, why were they still proposing and passing million dollar un-budgeted projects?

I railed against the constant haphazard proposals to accommodate the increasing staff numbers. For instance we hired a floor above the mall for staff. At the time staff were telling me that this was a temporary measure. I said that we would never shrink back, but the CEO assured me that we would once the rolling renovations were carried out in the TDC building.

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The result of the accommodation review was that we need a completely new and updated building for staff. It was deemed to be an urgent requirement and we should get right on to it. So I tried to have funds allocated in the LTP that was just passed. Staff (and management) refused to allocate any funds in the consulted on LTP.

Why? Well because we did not have a quote.

Just like we don’t have a quote, or even a plan for the Million dollars of funding set aside for a regional boat launching facility.

Just like we don’t have a location or design for the Recreation Centre proposed for somewhere between Hope and Wakefield – but we do have funds allocated.

Just like a dam that we didn’t have a quote for but had (woefully inadequate) funds set aside in previous LTPs.

After we had consulted on the LTP and before we had even signed off on it, staff were back telling us about the urgency of the accommodation problem and how we need to start taking action because of “long lead times” and “Council reputation.” Even though the Government is about to remove much of Council’s responsibilities (and staff), and may even be about to amalgamate Councils with their big-is-better attitude.

One can only speculate that the real reason that we didn’t allocate funds for this imminently urgent project is that it would have pushed our LTP debt figure of the magic $300 million figure that is politically unpalatable (and might result in the appointment of a commissioner). Apparently, Mayor Kempthorne, had earlier proposed an LTP that reached similar heady spending heights, and was told it might be wiser to rein in spending. And a figure that starts to run into Government legislated debt cap ceiling issues.

Which draws me to the “Debt Cap” that we recently consulted on. Previously, we had a $200 million self
imposed debt cap. It was a figure well above the current debt levels of the day, and set to be a ceiling.
What we have now, is very different. Even though we use the same terminology of “debt cap.”

How is it different you might ask? Well, our current $280 million debt cap, knocked down to some $250 million by moving a bit of the debt into the Dam CCO (where we don’t have to include it in our figures), is not really a cap. Rather, it is a projected level of spend. Any future unbudgeted spend will automatically push this figure up. For example, unbudgeted spend like new staff accommodation.

A real debt cap, should not move because of the spending whims of a majority of councillors. Other unbudgeted spend that might occur – and has already occurred – is another Dam blow out. Already, we are up to the higher end of the most recent budget given by Waimea Water (the Dam company). The figures included in our consulted on LTP were at the middle to lower end of the forcasted budget. And let us not forget that we are only just over half way through the build, with COVID inflation likely to push up the cost of steel and imported materials – and without further “surprises” in the “bedrock”, that Mike Scott said was better than expected.

Speaking of inflation. Another example of how out-of-touch with global reality our management are: I tried to point out the cost to the ratepayers of the proposed level debt when interest rates go to 6% or 8 %. I was challenged by the deputy Mayor as to what they would be at 2% interest.

At $250 million (and doing some simple maths) its doesn’t take much of a shift in interest rates with such high debt, to affect rates. Amidst the round of chortling from the old-boy network for even thinking interest rates would go up, he retorted that he had information suggesting otherwise. I only hope its not the same advisor, who told him the Dam price was fixed?

In a world where global inflation is at levels not seen since the early 1980’s we apparently believe that interest rates will continue at 2% levels and not 1980’s levels. These are the same people “can’t be sure” that the dam will continue to overrun. Although, councilor Mailing would not take up my wager that the dam would not be built for the most recently forecast figure, which is surprising given how much higher that figure is than the $104 million that he publicly personally guaranteed he would ensure it would be built for (and on time) at the time of the last elections.

On the dam front: it is interesting to learn that the “shear zone” which is directly under the dam abutment is “not an earthquake faultline” according to Mr Kirby our head of engineering. I was asking Mike Scott if the shear zone is what a lay person might call an earthquake faultline. He said it was not, to which I suggested that begs the question of what the difference is. Mr Kirby gave a somewhat more detailed response defending the position that a shear zone is a small fracture caused by movement elsewhere (like one of the two faultlines either side of the dam). A shear zone is a small (in this case 5 meter wide by few hundred meters long) fracture, whereas a fault line stretches many miles.

Now whether we call it a fault line or not would appear to be semantics and headline damage control. What we have is a fracture caused by earth movement that sits right under the dam structure. If the ground moves again – along a fault line that is not this shear zone – what are the chances that this shear zone will respond by opening up more? Or perhaps there will be another shear zone near by that will open up – remember there is going to be an extraordinary amount of extra pressure here once the reservoir is filled. But of course I am no geologist. And maybe the concrete band aid we are applying will stop any future ground movement and the water will not flow out new cracks, nor will the dam crumble around a failing abutment during an earthquake.

I guess we should be reassured that the recently disgraced ex-MP Nick Smith cast his engineering trained eye over the site and said he could see no issues. He also guaranteed a bottle of win to those downstream of the dam in the event of a dam failure. Which I am sure is of great comfort to those down the valley.

It is also comforting to know that we are having an inquiry into the dam process that saw us go from a “P95” (95% certain to come in on or under budget) $75.9 million dam to a “good as fixed price” $104 million dam to a who-knows-where-we-will-end-up $million dam. As mentioned before, it already has gone up another $5 million (equating to $163 million) within a week of the LTP being signed off.

What is odd about the inquiry is that it only came about after much public noise. It was previously unsupported by council as a measure of good governance practice. How times can change. A few weeks can be a long time for some memories. █████████████████████████████████ █████████████████████████████████████████████████████████████████████████████████████████████

I voted against it. Which may seem to odd to those who heard me calling for it in the first place.

The scope of the inquiry is purely retrospective. There is no provision to investigate the current management and governance of the dam which is the only place that savings can potentially be found for the ratepayer. A retrospective inquiry can be held at any time, there is no urgency, and little to be gained on this project. Yes, it would be good to expose the decision making that got us in this position but what real-world governance would allow a project to overrun three times the P95 price only half way through the job without questioning the delivery?

Unfortunately, the Office of the Auditor General (OAG) was not interested in undertaking this inquiry either – according to staff advice on the day we voted. At least that is what we were told, until councillor Greening asked for confirmation of this position. Within a few days, staff were advising that the OAG might now be interested, and that staff would be seeking clarification. A few weeks later, and the OAG advised us that because council had undertaken their own review, an OAG review was not necessary. █████████████████████████████████████████████████████████████

On the bright side, John Palmer’s (ex-CEO of the bankrupted Solid Energy and man assuring us that the dam was going to be built to the P95) brother is involved in a review of Local Government. As quoted in a RNZ interview:

Review panel chair Jim Palmer said it was a once-in-a-lifetime chance to make a difference, but warned the decisions made were “not going to please everybody all of the time”.

We look forward to another 12 months of a more-of-the-same only more expensive Council.

Filed Under: Dam, Spending, Your Say Tagged With: Debt, Long Term Plan, spending, Tasman District Council, Waimea dam

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Dean McNamara Husband, father, and a fourth generation local from rural Tasman. No longer acting as your voice on the Tasman District Council (TDC). More about me.

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