Agenda of Performance, Audit and Risk Committee

Performance, Audit and Risk Committee

Meeting UNCONFIRMED Minutes

27 May 2025

UNCONFIRMED MINUTES

OF THE Performance, Audit and Risk Committee Meeting
HELD IN THE Council Chamber, Third Floor, Office of the Waitaki District Council , 20 Thames Street, Oamaru
ON Tuesday, 27 May 2025 AT 9.03AM

PRESENT: Chair Simon Neale, Member John McCone, Member Rebecca Ryan, Mayor Gary Kircher, Member Jim Hopkins, Deputy Mayor Hana Halalele, Member Tim Blackler, Cr Brett Cowles, Cr Jim Thomson.

IN ATTENDANCE: Alex Parmley (Chief Executive)

Roger Cook (Director, Natural & Built Environment)

Paul Hope (Director, Support Services)

Joanne O’Neill (Director, Strategy, Performance & Design)

Amanda Nicholls (Finance Manager)

Jason Lilley (Livestream Support)

Arlene Goss (Governance Lead/Minutes)

Ray Henderson (Public)

This meeting was live-streamed and can be viewed at https://www.youtube.com/live/NmxDgggBG2Q?si=9Mj81KFkbG-pBpdD

meeting open

The chairman declared the meeting open at 9.03am and welcomed everyone present.

1 Apologies

Resolved PAR 2025/024

Moved: Member Jim Hopkins

Seconded: Member Tim Blackler

That the apology received from Cr Jeremy Holding be accepted.

Carried

2 Declarations of Interest

There were no declarations of interest.

3 Confirmation of Previous Meeting Minutes

3.1 Public minutes of the Performance, Audit and Risk Committee Meeting held on 29 April 2025

A grammatical correction was requested under Item 5.6 – to change the words ‘is’ and ‘has’ to ‘was’ and ‘had’.

Resolved PAR 2025/025

Moved: Mr Simon Neale

Seconded: Mayor Gary Kircher

That the Performance, Audit and Risk Committee agrees to confirm the public excluded minutes in the public part of this meeting.

CARRIED

Resolved PAR 2025/026

Moved: Deputy Mayor Hana Halalele

Seconded: Cr Rebecca Ryan

That the Performance, Audit and Risk Committee confirms the public and public excluded minutes of the Performance, Audit and Risk Committee Meeting held on 29 April 2025, as circulated, as a true and correct record of that meeting.

Carried

4 Memorandum Reports

4.1 Financial Summary (to 30 April 2025)

This report presented a high-level financial summary for the period ended 30 April 2025.

The finance manager noted the lower grant income regarding the Waitaki Events Centre. She now expected to receive the full funding from the trust by June 30.

Points raised in the discussion included:

· Clarification on the situation with the ETS levy.

· The need for a strategic approach to depreciation.

At 9.20am the meeting was adjourned due to a loud sound coming from the microphone units in the council chambers. The online link was halted. The technical issues were investigated by staff and could not be repaired quickly. So the chairman reconvened the meeting at 9.44am without the livestream.

The chairman asked if the councillors wanted to continue the discussion on depreciation. He said looking at the wider strategic picture this would be all about roading. The only way to reduce depreciation on roading would be to reduce the service levels. This would require a discussion to be held in the next triennium.

Further discussion included:

· Using depreciation as a way to smooth the rates curve.

· Getting three waters sorted before looking at what could happen in the roading space.

· There was a request to include a footnote on capital spend in the space attributed to wages in future financial reports.

· Cashflow in the near future will be more unpredictable, as Council was currently working on three significant projects - Kakanui Bridge, the Events Centre and the Gallery Upgrade.

· Cashflow was also unpredictable because more people were waiting until the last day to make their rates payments.

· There was a two and a half percent overspend on personnel, once the $144k backfill for staff vacancies was included. The Chair indicated their concern that employee costs still remained so high and were forecast to be even higher in 25/26 given the expected transformation efficiencies.

· The chair asked about a personnel report commissioned from “Maven” and asked for someone from the Transformation team to present a summary of this at the next meeting.

· A preferred candidate for the risk management role had withdrawn due to personal circumstances. Recruitments efforts were ongoing but it was proving difficult to fill the role. An action was taken to continue the discussion offline with potential to second or outsource some of the function to neighbouring councils.

Resolved PAR 2025/027

Moved: Member Jim Hopkins

Seconded: Chairperson Gary Kircher

That the Performance, Audit and Risk Committee receives and notes the information.

Carried

5 Meeting Close

The meeting did not go into public excluded and the Chair declared the meeting closed at 10.02am.

TO BE CONFIRMED at the Performance, Audit and Risk Committee Meeting to be held on Tuesday, 24 June 2025.

...................................................

CHAIRPERSON

Performance, Audit and Risk Committee

Meeting Agenda

24 June 2025

4 Memorandum Reports

4.1 Financial Summary (to 31 May 2025)

Author: Amanda Nicholls, Chief Financial Officer

Authoriser: Paul Hope, Director Support Services

Recommendation

That the Performance, Audit and Risk Committee receives and notes the information.

Purpose

This report presents a high-level financial summary for the period ended 31 May 2025.

COMMENTARY

This report does not replace the regular financial reporting that is provided at each quarter’s end. Instead, it is intended to supplement that reporting and bridge the gap between the quarters.

Overall operating revenue is lower than forecast and operating expenses are higher than forecast. This combination means that Council’s overall operating result for the period, is a deficit of $(5,941)K, versus the budgeted surplus of $998K for the same period. This significantly lower operating result than expected is due largely to timing variances of the grants not yet received for the Events Centre, as well as increased costs in the current year in relation to Project Reclaim, and higher Depreciation than forecast, as can be seen from the tables detailing actual income and expenditure.

Income and Expenditure

· Revenue from external grants is under budget by $2.86 million as grants for the Events Centre were being contributed at 50% of the cost. It was anticipated that funds would be received to cover the full cost of the first year of the build, and Council borrowing would not be required until the second year of the build (to cover Council’s $15m share of the project cost in the 2026 financial year). During May $3,450K of donations were received for the Events Centre they hope to have another $2,000K available by end of Jun 25 - $nil has been accrued for Donations in the May 25 period. Going forward it is intended they will advance funds that are available.

· Finance Revenue is under budget, reflecting the reduction after Observatory Village repaid and reducing interest rates, while Finance Costs are slightly over budget due to the timing of new borrowings, although interest rates from the LGFA are reducing as has the amount borrowed.

· Revenue from development contributions (DCs) is under budget due to the decision to approve the timing of amounts charged to the Omarama Airfield Ltd in relation to the subdivision of airfield land. DCs will now be charged as sections in the subdivision are sold – effectively not losing income but deferring it.

· Depreciation is reported over budget by $2.2 million, largely as a result of the larger-than-expected revaluation of waters infrastructure at June 2024. This variance will continue to grow until year end.

· Personnel costs are slightly over budget by $81k.

· Project Reclaim costs are $1.8 million over budget due to timing variances between the 2024 and 2025 financial years budgets. We have received confirmation that the ETS levy has been fully waived. This levy was never physically paid or accrued for so it will not be “returned”; and does not improve the financial results; however, it is welcome news that Council does not have to foot this cost.

A number of aspects of the May period have still to be finalised so the result reported here is an interim one and is provided as an indication of Council-wide financial performance.

The next full quarterly report will be provided in July for the full year ended 30 June 2025.

Key Financial Update at 31 May 2025

Capital Expenditure for the period is $10.8m behind budget. Good progress is now being made on the Events Centre project and the Forrester Gallery and Kakanui Bridge projects are also underway.

Financial Position

Budget figures appearing in the table above represent the projected year-end position and so may not be directly comparable with the year-to-date position.

1. The budget for Property, Plant and Equipment includes not only the full year’s capital expenditure, less Depreciation, but also the triennial revaluation of property, including parks and reserves, and the Oamaru airport, and the annual revaluation of Roading infrastructure, both to be processed in June 2025.

2. Loans to Other Entities are detailed as part of the Quarterly Treasury Report and the Treasury Strategy. The 2024-25 budget is based on repayment in June 2025 of $1.5 million by Observatory Village per the loan agreement and regular quarterly payments of principal by NOIC and Kurow-Duntroon Irrigation Company. However, the Observatory Village Loan of 15.6 million was fully repaid on 3 February 2025. The Kurow-Duntroon Irrigation Company renegotiated their loan to exclude repaying principal.

3. Cash and Cash Equivalents were lower than normal due to being managed prudently in line with the cash timing of Rates Revenue and Project payments5,941

4. Borrowings are detailed in the Quarterly Treasury Report and Treasury Strategy. The 2024-25 budget anticipated that Council would require further support from the LGFA up to year end to fund Waters and other capital projects, however circa $20m of capex has been deferred so this borrowing is no longer required, also the budget did not anticipate the early repayment of the Observatory Loan.

Performance, Audit and Risk Committee

Meeting Agenda

24 June 2025

4.2 Infrastructure Compliance (Health & Hygiene) Reporting

Author: Joshua Rendell, Infrastructure Manager

Authoriser: Roger Cook, Director Natural and Built Environment

Recommendation

That Performance, Audit and Risk Committee receives and notes the information.

Purpose

To update the Performance Audit and Risk Committee (PAR) on Waitaki District Council’s (WDC) compliance with the New Zealand Drinking Water Quality Assurance Rules (DWQAR) and resource consents as related to the delivery of Water, Wastewater, Stormwater and Solid Waste services.

background

Officers briefed Elected Members in May on current 3 Waters compliance issues requiring action. It was apparent that Elected Members were not fully aware of Council’s adherence to compliance requirements and the actions Officers are taking to resolve the non-compliance issues. Specifically, the on-going non-compliances and abatement notices for the Ōamaru and Palmerston Wastewater Treatment Plant’s.

Officers have committed to providing quarterly updates to PAR to ensure this Council’s compliance with the DWQAR and its resource consents are better understood prior to the annual report.

The tables in this report will form the basis of future updates. A traffic light system has been used for the compliance status.

Green signifies that all rules/conditions have been met for the compliance period.

Orange signifies one or more non-compliances have occurred in the compliance period, but enforcement action has not been taken by the relevant regulatory authority.

Red signifies that the non-compliances are significant and on-going and enforcement action has been taken.

Council should aim for all sites should be in the green status (compliant) but it is reasonable to expect that from time to time there will be non-compliances, particularly as assets age and consents near expiry.

Officers welcome feedback on the format of this report to ensure future updates are fit for purpose.

DWQAR compliance

The DWQAR’s set out what drinking water suppliers need to do to comply with key parts of the Drinking Water Standards and other requirements under the Water Services Act 2021.

The DWQAR, being the new standards Drinking Water Suppliers must meet came into effect on November 2022. The rules when released had a significant impact on the compliance status of a number of Councils supplies. Several of the supplies Council has already upgraded will need further upgrades to ensure compliance with the new standards. The new rules also place a greater emphasis on testing and data collection to substantiate water has been treated appropriately. Where a test has been missed or data is not available due to system errors or failures, the water supply can become technically non-compliant.

WDC is required to report on the compliance with the DWQAR in its annual report. The Department of Internal Affairs developed a mandatory performance measure which sets out how this information should be reported.

The following tables report the compliance status for quarters 1 & 2. A single quarter of non-compliance constitutes a non-compliance for the year.

The tables are grouped by supply level which is typically based on the registered population. A drinking water supplier can opt to meet a higher level.

Level 1 Supplies

DWQAR Rule	Bushy Creek	Duntroon	Lake Ōhau	Stoneburn
Overall Compliance Status Q1	Non-Compliant	Compliant	Non-Compliant	Non-Compliant
T1 Treatment Rules Q2	Not Met	Not Met	Not Met	Not Met
D1.1 Distribution Rules Q2	Met	Met	Met	Met
Overall Compliance Status Q2	Non-Compliant	Non-Compliant	Non-Compliant	Non-Compliant
Overall Compliance Status 2024-25	Non-Compliant	Non-Compliant	Non-Compliant	Non-Compliant

Level 1 Supplies Non-Compliance Description

Bushy Creek and Stoneburn – these supplies have not yet been upgraded. It is proposed to implement the Mixed-Use Rural Acceptable Solution. This is currently being reviewed and planning for the upgrades will commence once finalised.

Lake Ōhau – the new treatment plant is operational however commissioning issues are still being worked through.

Duntroon – during a heavy rain event in October, the UV disinfection system was bypassed due to the source water quality being below minimum UVT limits.

Level 2 Supplies

DWQAR Rule	Kurow	Otematata	Awamoko	Kauru Hill	Windsor
Overall Compliance Status Q1	Non-Compliant	Not Compliant	Non-Compliant	Non-Compliant	Non-Compliant
T2 Treatment Monitoring Rules Q2	Met	Met	Not Met	Not Met	Not Met
T2 Filtration Rules Q2	Not Met	Not Met	Met	Not Met	Not Met
T2 UV Rules Q2	Met	Met	Not Met	Not Met	Not Met
T2 Chlorine Rules Q2	Met	Met	Not Met	Met	Met
D2.1 Distribution Rules Q2	Met	Met	Met	Met	Met
Overall Compliance Status Q2	Non-Compliant	Not Compliant	Non-Compliant	Non-Compliant	Non-Compliant
Overall Compliance Status 2024-25	Non-Compliant	Non-Compliant	Non-Compliant	Non-Compliant	Non-Compliant

Level 2 Supplies Non-Compliance Description

Kurow and Otematata – these sites were upgraded prior to the DWQAR rules being released which require Level 2 supplies to have filtration. Officers are investigating whether the sites could meet Level 3 rules which do not require filtration. The Level 3 rules are more stringent in other aspects, so it may be more cost-effective to implement filtration.

Awamoko – this supply is managed by Corriedale Water Management Ltd (CWML) and has not yet been upgraded. CWML propose to implement the Mixed-Use Rural Acceptable Solution once the new rules are released by Taumata Arowai.

Two FAC results were less than the required 0.5mg/L in October 2024 and as such the Chlorine Rules were not met. One result was associated with plant start up after a weather-related shutdown and the other, a chlorine dosing issue.

Kauru Hill and Windsor - these supplies are managed by CWML and have not yet been upgraded. CWML propose to implement the Mixed-Use Rural Acceptable Solution once the new rules are released by Taumata Arowai.

Level 3 Supplies

DWQAR Rule	Ōamaru	Waihemo	Lower Waitaki	Ōmārama	Tokarahi
Overall Compliance Status Q1	Compliant	Compliant	Non-Compliant	Compliant	Non-Compliant
T3 Bacterial Rules Q2	Met	Met	Not Met	Met	Not Met
T3 Protozoal Rules Q2	Met	Met	Not Met	Met	Not Met
D3.29 Microbiological Monitoring Rule Q2	Met	Met	Met	Met	Met
Overall Compliance Status Q2	Compliant	Compliant	Non-Compliant	Compliant	Non-Compliant
Overall Compliance Status 2024-25	Compliant	Compliant	Non-Compliant	Compliant	Non-Compliant

Level 3 Supplies Non-Compliance Description

Lower Waitaki – the UV treatment in place does not equal or exceed the allocated Class 3 (4.0-Log) determination. There were also six days in October 2024 where the UV dose at some point during the day was less than the minimum requirement.

Tokarahi - this supply is managed by CWML and has not yet been upgraded. CWML propose to implement the Mixed-Use Rural Acceptable Solution once the new rules are released by Taumata Arowai.

resource consent compliance

Water

WDC has several resource consents permitting the taking of water for the purpose of supplying drinking-water to communities. The consents typically include limits around the volume and rate of take and requirements such as keeping leakage to a minimum.

WTP Name	Compliance Status	Comments
Ōamaru	NA	Lower Waitaki Irrigation Company is the consent holder. Application for four new consents is required by Otago Regional Council (ORC) for the Ardgowan Dam.
Palmerston	Non-Compliant Abatement Notice	Refer to Water Non-Compliance Description – Palmerston.
Lower Waitaki	Compliant
Duntroon	Compliant
Bushy Creek	Compliant
Kurow	Compliant
Otematata	Compliant
Ōmārama	Non-Compliant	Refer to Water Non-Compliance Description – Ōmārama.
Lake Ōhau	Compliant
Tokarahi	Non-Compliant	Managed by CWML.
Awamoko	Compliant
Kauru Hill	Compliant
Windsor	Compliant

Water Non-Compliance Description

Palmerston – in the 2023-24 summer period, the 7-day water take limit was consistently exceeded resulting in an abatement notice from ORC. WDC issued a Conserve Water Notice over the 2024-25 summer period and no further breaches occurred. Officers can now apply to have the abatement notice cancelled. A Conserve Water Notice and/or restrictions may be required every summer to ensure demand remains within consent limits.

Ōmārama – in early May, restrictions were imposed by ECan in accordance with the Ahuriri River Water Conservation Order, due to the Ōmārama Stream reaching the minimum flow limit. The restriction means only reasonable domestic water use is permitted for water take consent holders. WDC did not issue restrictions on Ōmārama Water Supply non-domestic (commercial) water users which may be considered a non-compliance. To prevent future breaches or needing to enforce closure of commercial businesses during a minimum flow period, it is proposed to apply to the Minister for the Environment for an exemption from meeting the order.

Tokarahi – since late May 2025, CWML have been working to resolve an on-going pumping issue at the Tokarahi Water Supply intake. During this period the instantaneous flow rate limit has been breached.

Wastewater

WDC has several resource consents permitting the discharge of treated wastewater to the environment. The consents typically include limits on volume and specific discharge quality parameters such as Biochemical Oxygen Demand (BOD5) and E-Coli.

WWTP Name	Compliance Status	Comments
Ōamaru	Non-Compliant Abatement Notice	Refer to Wastewater Non-Compliance Description – Ōamaru.
Palmerston	Non-Compliant Abatement Notice	Refer to Wastewater Non-Compliance Description – Palmerston.
Moeraki	Non-Compliant	Refer to Wastewater Non-Compliance Description – Moeraki.
Duntroon	Non-Compliant	Refer to Wastewater Non-Compliance Description – Duntroon. The discharge consent expires in February 2026. A new short-term consent will be applied for in the coming months to ensure the long-term consents align with the proposed new wastewater discharge standards.
Kurow	Compliant	ECan require application to be made for the following consents not currently in place: land use, discharge to air and seepage (from the unlined pond).
Otematata	Non-Compliant	Refer to Wastewater Non-Compliance Description – Otematata. ECan require application to be made for the following consents not currently in place: land use and discharge to air.
Ōmārama	Non-Compliant	Refer to Wastewater Non-Compliance Description – Ōmārama. ECan require application to be made for the following consents not currently in place: land use and discharge to air.
Lake Ōhau	Compliant	ECan require application to be made for the following consents not currently in place: land use, discharge to air and seepage (from the unlined pond)

Wastewater Non-Compliance Description

Ōamaru – two abatement notices are in place for on-going breaches of consent discharge quality parameter limits for BOD5 and Suspended Solids (discharge to Landon Creek) and E-Coli (discharge to land). ORC recently agreed to extend the compliance date to 1 July 2025.

For a number of months, BOD5 has been the only remaining non-compliant parameter, and the levels have been trending downwards. Should this continue, WDC will be in a good position to apply to remove the now compliant parameters from the abatement notice and extend the compliance date for BOD5, to allow time to see if the levels drop to within compliance levels. If they don’t, treatment upgrades will be required. Officers are investigating options for filtration of effluent prior to discharge.

Palmerston – an abatement notice is in place for on-going breaches of consent discharge quality parameter limits for Suspended Solids and E-Coli, and acceptance of Palmerston Closed Landfill leachate into the wastewater system when the consent is for the discharge of treated domestic wastewater only. Compliance is expected by 24 October 2025.

WDC has engaged Fluent Solutions to apply for a new trade waste consent which will resolve the landfill leachate matter and apply to vary the conditions related to discharge volume and quality parameter limits. A reduction in the consented volume limit, should make an increase in the discharge quality parameter limits possible, as the overall loading to the land dispersal system does not change. If both consent applications are approved, the site will be back in compliance.

Moeraki – the current method of recording when the land dispersal system is grazed, used in the calculation for nitrogen loading, is not considered acceptable by ORC. Further discussion is needed with ORC, and potentially the landowner, to agree on the best option.

Number of days irrigated is also used for the nitrogen loading calculation and there are limits in the consent on how many days each zone can be irrigated. Data recently submitted to ORC indicated that the irrigation zones were being over-irrigated. Further assessment identified that the sprinkler cycle runs from 10pm to 8am and this has historically been counted as two days. ORC has agreed that this should only be counted as one day. They are allowing re-submission of the data which, with the changes, may mean the site is compliant.

Duntroon – due to health and safety concerns and insufficient volumes of wastewater, sampling to determine the level of compliance with consent discharge quality parameter limits, cannot be undertaken in accordance with consent requirements. Alternative monitoring will be proposed as part of the new short-term consent application.

Otematata – WDC has 12 subsurface infiltration trenches that treated wastewater is discharged to. The discharge consent states that there must always be at least one metre separation between the subsurface pipework and the groundwater level. Two of the trenches at the lower end of the site cannot achieve this. Simply abandoning these trenches would reduce application area and likely result in breaches of the consent discharge application rate limits in peak summer months. As such, eight new trenches have recently been installed.

Following confirmation from ECan, the new trenches will be commissioned and the two lower trenches decommissioned. The site should then be back in compliance.

Ōmārama – the consent three-month rolling discharge volume limit was breached in March 2025. Given the consent is relatively new and there are no obvious reasons why the site would not be performing within the set limits, officers requested Fluent Solutions investigate and recommend potential solutions to prevent future breaches.

Fluent Solutions identified that while the daily discharge volume limit includes an allowance for peak flows and wet weather, the three-month rolling discharge volume limit does not. It is proposed to apply to ECan to vary the three-month rolling discharge volume limit to ensure it better reflects unavoidable peaks.

Stormwater

WDC has only one stormwater discharge consent. It is a global consent issued by ECan and covers all townships with WDC owned stormwater systems in the Waitaki Valley. The consent does not include discharge quality parameter limits but does require a number of plans and processes be prepared and implemented.

System Name	Compliance Status	Comments
Ahuriri	Non-Compliant	Refer to Stormwater Non-Compliance Description – Ahuriri.

Stormwater Non-Compliance Description

Ahuriri – several documents were required to be prepared and implemented by December 2021 and due to conflicting priorities, this did not happen.

A review of the Stormwater Management Plan that accompanied the original consent application, needs to be completed in the near future. This will ensure all of the documents listed in the consent are still required. Once that is confirmed, a request to extend the due date for the submission of the relevant documents will be made to ECan.

Solid Waste

WDC has several resource consents for the discharge of contaminants to the environment from closed landfill sites. Only one consent requires monitoring of discharge quality parameters. Other conditions predominantly relate to on-going inspection of the sites to ensure the landfill caps remain in good order.

Site Name	Compliance Status	Comments
Ōamaru Closed Landfill	Compliant
Palmerston Closed Landfill	Compliant
Moeraki Closed Landfill	Compliant	Consents expire in late 2025. Officers are proposing no applying for new consents. However, officers will continue to inspect and manage the sites.
Herbert Closed Landfill	Compliant
Enfield Closed Landfill	Compliant
Ngapara Closed Landfill	Compliant
Livingstone Closed Landfill	Compliant
Duntroon Closed Landfill	Compliant
Otekaieke Closed Landfill	Compliant
Kurow Closed Landfill	Compliant
Otematata Closed Landfill	Compliant
Ōmārama Closed Landfill	Compliant

Performance, Audit and Risk Committee

Meeting Agenda

24 June 2025

4.3 Waitaki District Council Greenhouse Gas Emissions Inventory report

Author: Victoria van der Spek, Policy Lead

Authoriser: Joanne O'Neill, Director Strategy, Performance, and Design

Attachments: 1. Greenhouse Gas Emissions Inventory Report ⇩

Recommendation

That the Performance, Audit and Risk Committee receives and notes the information.

Purpose

This report presents a high-level summary of the Waitaki District Council Greenhouse Gas Emissions Inventory Report (base year 2022-23).

Summary

Waitaki District Council has completed its first ISO 14064-1:2018 compliant greenhouse gas emissions inventory for the 2022/23 financial year. This report establishes a verified baseline of all emissions from Council operations and replaces the previous 2018/19 report, which could not serve as a reliable baseline due to the five-year gap, changes in Council operations, updated emission factors, and non-compliance with current ISO standards.

Background

In 2015, Council committed to:

· Reducing emissions through action plans

· Integrating climate considerations into all Council decisions and planning

· Supporting community resilience for climate change impacts

· Collaborating with government on national targets while advocating for fair treatment of our district

Key benefits of Greenhouse Gas Emissions Inventory report

· Meets our stated commitments as an organisation

· Provides a baseline for prioritising emissions reduction efforts

· Aligns with national emissions reduction targets

· Increases transparency and accountability to our community

· Provides long term sustainable and financial savings e.g., boiler to heat pump conversion, swap to LED street lighting, transition to hybrid/EV from petrol/diesel fleet

· Attracts funding and grants from government and private organisations

· Long Term Plan processes require regular emissions monitoring for infrastructure planning.

· Annual Plan budgeting needs current emissions data for climate-related investments.

Minor correction

Since finalising the report, officer’s have noted an error on page 24. The report states at 2.4 “In order to achieve the reduction targets identified in Table 7, specific projects have been identified to achieve these and are detailed in Table 8”.

As there is no Target identified in Table 7, the introduction to Table 8 should read “As this is the base year for the report, there are no targets set in Table 7. Despite this, Council has done some work over the last 5 years to actively reduce their emissions and have work planned to reduce their emissions further. These are detailed below in Table 8.”

Greenhouse gas top 3 emission sources for Waitaki District Council

1. Wastewater Treatment (929 tCO2e) - 39% of total emissions

2. Electricity Consumption (674 tCO2e) - 29% of total emissions

3. Waste to Landfill (300 tCO2e) - 13% of total emissions

Waitaki District Council emissions profile

Category	Emissions (tCO2e)	% of Total
Category 1: Direct Emissions	1,183	49%
Category 2: Electricity	674	29%
Category 3: Business Travel	41	2%
Category 4: Waste & Contractors	467	20%

Category 1 represents direct emissions from sources owned or controlled by Council - emissions that occur on Council property or from Council-owned equipment. Major components include methane and nitrous oxide from treating the district's wastewater (78.5%), fuel used in Council fleet vehicles (diesel and petrol) (13.0%), diesel generators, LPG heating, boilers at Council facilities (8.5%), and fertilizer used on Council land (less than 0.1%).

Financial Context

· Operating Revenue: $44.3M (2022/23)

· Emissions Intensity: 53.4 tCO2e per $1M revenue

Risk Considerations

· Data Quality Gaps: Significant reliance on estimations for wastewater and waste disposal due to limited contractor data

· Population Growth Impact: Increasing wastewater volumes represent the largest future emissions driver

· Carbon Liability: 23,196 tCO2e contingent liability from forestry assets (risk of release through fire, flood, or harvesting)

The verification status was stated as "Reasonable" except for Category 1 wastewater and forestry (limited assurance). This makes it difficult to set reliable reduction targets with uncertain baseline data, and a possible over-reliance on unverified carbon credits.

For wastewater, Council used generic industry averages instead of actual measurements from our treatment plants. There was no direct sampling of wastewater inputs/outputs, and the actual methane and nitrous oxide production rates could not be specified.

Risk: May be significantly over or under-reporting our largest emission source.

Forestry carbon sequestration was calculated using standard lookup tables rather than measuring actual forest growth. No field surveys of Council forestry assets were undertaken.

Risk: $23.2M contingent carbon liability inadequately verified.

Mitigation Initiatives Already Implemented by Council

· LED streetlight conversion (completed 2019) - ongoing energy savings

· Heat pump installation at library (2023) - improved efficiency

· Aquatic Centre LED lighting (2024) - reduced electricity consumption

Planned emission Reduction Projects identified in report

· Transition to electric/hybrid fleet vehicles

· Solar panel installation on proposed Forrester Gallery extension

· Pool pH system conversion from CO2 to Sodium Bisulphate

· Waste minimisation programs (Bokashi bins)

Next steps

The report identifies some recommended actions in the short and medium term.

Immediate Actions

1. Improve data collection systems

2. Commit to annual reporting

3. Set formal reduction targets for Year 2 reporting

4. Allocate budget for continuous emissions annual monitoring and reduction projects

Medium-term Focus Areas

1. Wastewater efficiency upgrades - explore energy recovery systems

2. Renewable electricity procurement

3. Enhanced waste diversion programmes

Conclusion

Based on the recommendations from this report, Council should consider approving dedicated resources for emissions reduction initiatives and annual inventory updates to track progress against future targets. Currently through Council’s Long-Term Plan, a limited budget is set aside for bi-annual inventory updates.

This baseline inventory also positions Council to develop a comprehensive climate action or equivalent strategy.

Performance, Audit and Risk Committee

Meeting Agenda

24 June 2025

4.5 Risk Management Update Quarter 2 2025

Author: Laura Spring, Strategy and Policy Advisor

Authoriser: Joanne O'Neill, Director Strategy, Performance, and Design

Attachments: 1. Risk Register at June 2025 ⇩

Recommendation

That Performance, Audit and Risk Committee receives and notes the information.

Purpose

The report provides an update on risk management activity throughout the organisation for quarter 2, 2025. It focuses on the key risks of Council and aims to promote discussion about both the external and internal risk landscape currently being faced by Council.

Summary

Key risks are defined in Council’s Risk Management Policy as strategic and organisational risks that are significant enough to require senior management ownership and quarterly reporting to the Performance, Audit and Risk Committee, regardless of whether they are within or out of appetite. Key Risks are split into two categories:

· Strategic Key Risks - owned by Senior Management Team (SMT) members and require review by Elected Members in their entirety

· Organisational Key Risks - may be owned by SMT members or their direct reports and can be categorised as Financial or Operational risks.

As the owners of Council's Key Risk Register, the Senior Management Team (SMT) must review the Strategic and Organisational risks on a quarterly basis.

SMT’s second quarter review shows Council's risk profile has improved, with three risks reducing and no increases, and very high risks decreasing from five to four. Three Waters infrastructure compliance has been identified as requiring urgent treatment through separate quarterly reporting to the Committee.

Key Risk quarterly review

Council currently has 27 Key Risks identified. These are broken into inherent and residual risk scores as identified in Figure 1. Inherent Risk is the level of risk that exists before any controls, safeguards, or mitigation measures are put in place. Residual Risk is the level of risk that remains after controls and mitigation measures have been implemented and are operating effectively, representing the actual current risk exposure that the organisation faces.

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Figure 1 Breakdown of Council’s Key Risks – Quarter 2, 2025

Very High Key Risks 

Overall, the number of Key Risks with a residual rating of very high has reduced this quarter from five to four: 

· Externally Managed Council Water Supplies  

· 3 Waters Management  

· Affordability and Financial Sustainability  

· Climate Change. 

Decreased risk ratings

‘Staff serious harm’ 

· Very high to high – the impact and likelihood have reduced due to progress made on strengthening and implementing controls since last quarter, including Situational Training with Police and situational awareness training for staff. 

‘District Development’ 

· High to medium – the residual impact dropped from 4 (Major) to 3 (Moderate). This is due to progress in implementation of the Economic Development Strategy workstreams. 

‘Natural Environment and Biodiversity’ 

· High to Medium – the residual impact was reduced to reflect the biodiversity provisions in the Proposed District Plan that came into legal effect in March.

Improvements 

‘3 Waters Management’ 

· Residual Likelihood dropped from 5 (Almost Certain) to 4 (Likely) due to progress made in understanding the options and costs of delivering water services under the new legislation and securing additional resource to assist with the transition. This risk remains very high. 

‘Public harm’ 

· Residual Impact dropped from 5 (Extreme) to 4 (Major) as there is confidence that the active controls would mitigate the scale of an event should one occur. This risk remains high. 

Other changes 

‘Data Privacy and Protection’ 

· The Residual Impact score decreased from 4 (Major) to 3 (Moderate) to reflect the strength of the active controls. The residual likelihood has increased from 3 (Possible) to 5 (Almost Certain), because of the number of minor breaches occurring. This risk also remains high.   

Operational Risk Management

The risk of non-compliance of Council's Three Waters infrastructure has been identified as an area demanding prompt treatment and will be reported on in a separate, quarterly Compliance update to this Committee.

Operational Risk Events

The Operational Risk Event (ORE) process aims to identify issues that have occurred that may result in negative impacts upon Council, individuals, or communities. None of the logged OREs have an impact that trigger a report to the Committee. Further guidance on specific events is currently being rolled out to key staff.

Conclusion

Council's key risk exposure has improved this quarter, with very high risks reducing from five to four. The remaining very high risks are largely driven by ongoing central government legislative and regulatory changes. Council will continue monitoring risk exposure through established processes and implementing mitigation measures where possible.