LGNZ and the Department of Internal Affairs have a summary about the Three Waters reform. This can be seen here.

They have also developed a series of FAQ’s to explain the reforms. This includes information about:

• Why the reforms are being proposed
• What the government is proposing for a new model for delivery of three waters
• What will happen to ownership of assets
• What government support is being provided to councils
• How governance of the new entities will work including the representative role of mana whenua.

Councils across New Zealand are going to face increased costs to deliver three waters services to a higher standard, regardless if the reform process takes place or not.

Councillors agreed to participate in the initial stage of the three waters reforms in August 2020. This enabled us to be part of the discussions on the reforms.

NCC has not been asked to yet take a position for or against opting into the government’s proposed Three Waters reforms. This was made public in a recent media release (19 July 2021).

Feedback was provided to central government in September 2021, stating NCC's concerns about what was proposed.

NCC, along with the general public, will be able to submit on the Water Services Entities Bill. NCC will be seeking public feedback to inform its submisison.

Submissions can now be made until 22 July 2022.

The Government initially presented councils throughout the country with a reform proposal that outlined why they believe change is needed. It also outlined the impact at the local level for each council.

Councils were asked to provide a range of information related to our three water assets earlier this year to Central Government through a Request for Information process. This information was used by the Department for Internal Affairs to consider a range of scenarios for three waters reform. This formed the basis of the “national case for change” that supports the current proposal.

In July 2021, the Government stated that the reforms would be mandated.

In October 2021, Councils were able to provide feedback on the Three Waters Reforms.

On 27 October 2021 the Government released more details about the reforms.

Local government working groups were set up to provide feedback to the Government on the proposed reforms. The recommendations from these working groups were provided to the Government in March 2022.

In April 2022, the Government announced that they would adopt the majority of the recommendations provided to them from the working group.

On 2 June 2022, the Water Services Entities Bill was introduced to Parliament. The first reading of the Bill occurred on 9 June 2022, and the Bill was referred to the Finance and Expenditure Select Committee.

On 10 June 2022 the Select Committee began accepting submissions on the Bill.

Submissions will be accepted until 22 July 2022.

Nelson City Council will be submitting on the Bill. NCC will seek feedback from the public to inform its submission.

This will be through a feedback form (on this page) and public-forum type meetings will held so the public can talk to Elected Members.

The book value for NCC’s land and infrastructure for the three waters assets, and a 50% share of the Nelson Regional Sewerage Business Unit, as at 30 June 2021 is listed below.

Also listed is an estimated value for 30 June 2024, the date which this transfer is proposed to be completed by.

Note: These asset values include land which has been revalued at current market value, buildings and equipment which are valued at historical cost less accumulated depreciation and Infrastructure which is revalued at replacement cost less accumulated depreciation. These are therefore accounting values rather than what it would cost to replace the assets or what they are insured for.

Should the three waters reforms proceed, the value of any assets that would be transferred to a three waters regional entity, from any Council, is not yet confirmed. There are several factors that will need clarification before any valuation is determined, such as the makeup of the stormwater components and what is likely to remain with Council as roading or reserves assets.

The Government’s current proposal is for four new regional water services entities to be established. Under the proposal, a council’s three waters assets and liabilities would transfer to one of the regional entities. However, entities will remain in public ownership.

Local authorities would be the owners of the entity, on behalf of their communities (through a proportional shareholding in the entity - based on population).

The entities will own and operate three waters infrastructure on behalf of territorial authorities – they will also hold three waters assets and associated debt.

The assets aren’t being sold – the new entities would be collectively owned by councils, on behalf of communities.

Independent, competency-based boards would govern each entity.

It is currently proposed that Councils and mana whenua would appoint a Regional Representative Group. This group would appoint an Independent Selection Panel, which would appoint the Entity Board.

Each entity would also have to engage with its communities on key documents that set its direction. The entity would actively report on how consumer and community feedback was incorporated into decision-making.

Note: The Governance Working Group made a series of recommendations in March 2022 relating to the Governance Structure of the Three Waters Entities. These recommendations are being incorporated into the final Water Services Entity Bill.

The Government has proposed a financial support package to councils which is made up of two components. The following information on the two components is taken from NCC’s press release dated 19 July 2021:

‘"No worse off" component: $500 million is set aside to provide certainty for local authorities that they will be supported through the transition process, and to ensure the financial impacts of reform will be managed. This “no worse off” component of the support package seeks to address the costs and financial impacts that councils would incur such as the transfer of water assets, liabilities, revenue and staff to a new water services entity. The funding also ensures councils will be able to continue to sustainably perform their non-water related roles and functions.

The “better off” component: comprises $1 billion Crown funding and $1 billion from the new water services entities and is allocated to councils on the basis of a nationally consistent formula. Councils will be able to use this funding to support the three waters service reform and focus on other local wellbeing outcomes associated with climate change and resilience, housing and urban design and planning, and community wellbeing.’

Under this formula, Nelson would receive a support package of $20,715,034 (from the better off provision – the “no worse off” component is yet to be calculated). This will also provide recognition that the transfer will result in some stranded overhead costs for councils, that will need to be managed.