Appointment of a Crown Manager to the Kaipara District Council

Pursuant to section 258D, and with reference to section 258P of the Local Government Act 2002 (“Act”), the Associate Minister of Local Government (under delegation from the Minister of Local Government) gives notice of her appointment of

Peter David McGredy Winder

as Crown Manager to the Kaipara District Council (“Council”).

The role of the Crown Manager is to address any outstanding or future legal actions relating to the development of the Mangawhai Community Wastewater Scheme (“Scheme”), and the setting and collection of rates during and prior to the Kaipara District Council Commission’s term (“Kaipara Commission’s term”).

The term for the Crown Manager appointment and the management period starts on 20 June 2017. The appointment and management period will, unless otherwise advised by the Minister of Local Government, end on date of the 2019 local government elections. The Minister of Local Government will undertake a review of the continued need for this appointment in June 2018.

Background

On 15 May 2017, Cabinet agreed to the appointment of a Crown Manager to assist the Kaipara District Council.

There are current legal actions relating to the development of the Scheme, and the setting or collection of rates during the Kaipara Commission’s term. These legal actions could inhibit the ability of the recently elected Council to make immediate decisions on behalf of the community and provide effective governance. These legal cases may distract the Council from its governance role. Pursuant to Part 10 of the Act, this creates concerns of probable adverse consequences for residents and ratepayers.

Pursuant to section 258D of the Act, the Crown Manager is being appointed to assist the Council on any outstanding and future legal actions relating to the development of the Scheme, and the setting or collection of rates during and prior to the Kaipara Commission’s term on the Council’s behalf.

The Associate Minister of Local Government considers that the assistance of a Crown Manager is important to the success of Council members in providing effective governance. Pursuant to section 258D(1)(a) of the Act, and in accordance with the Minister of Local Government’s delegation of all matters relating to the Council, the Associate Minister of Local Government appoints a Crown Manager to assist the Council.

Section 258O of the Act requires the Minister of Local Government (“Minister”) to publish in the New Zealand Gazette a list of matters relevant to determining what action, if any, to take under subpart 1 of Part 10 of the Act, which relates to Ministerial powers of assistance and intervention in relation to local authorities. Section 258P of the Act requires the Minister to have regard to the list of matters published in the New Zealand Gazette, 28 March 2013, No. 38, page 1140.

The list of matters to which the Minister must have regard comprise:

(a) Guiding principles:

In making decisions under Part 10 of the Act and determining what action, if any, to take under Subpart 1 of Part 10 of the Act, the Minister is likely to adopt the following guiding principles:

Ministerial action should be informed by the purpose of local government and the role of, and principles relating to, local authorities, as set out in Subparts 1 and 2 of Part 2 of the Act;
local authorities are responsible for preventing and solving their own problems;
local authorities’ accountability is to their ratepayers and residents;
elections are the primary mechanism for communities to express satisfaction or dissatisfaction with elected representatives;
Ministerial assistance or intervention should have regard to:
- what the local authority has done, is doing, or plans to do about the problem; and
- the costs and benefits of assistance or intervention;
Ministerial assistance or intervention should be proportionate to:
- the nature and magnitude of the problem;
- its potential consequences; and
- its duration to date and its likely duration if not addressed;
Ministerial assistance or intervention should endure for only as long as necessary to resolve the problem and provide for a transition back to normal democratic processes; and
Ministerial decisions regarding assistance or intervention should be transparent.

(b) Matters likely to detract from the ability of local authorities to give effect to the purpose of local government:

The matters or circumstances relating to management or governance of local authorities that the Minister considers are likely to detract from the ability of local authorities to give effect to the purpose of local government within their districts or regions are:

financial mismanagement;
a significant failure in service delivery;
dysfunctional governance, which includes:
- failure or breakdown of key relationships; and/or
- serious capability deficiencies of elected members or the chief executive of the local authority.

(c) Types and sources of information:

When making decisions under Part 10 of the Act, the Minister is likely to consider the following types and sources of information:

Plans or reports from the local authority, which are voluntarily supplied, required under section 257 of the Act or any other enactment, or requested under any enactment;
audit reports, including assessment of the accuracy and adequacy of financial reporting required by Regulations made under section 259 of the Act; and
reviews, reports or communications from any person, group or organisation.

Extent of authority

The Crown Manager will provide direction on outstanding and future legal actions relating to the development of the Scheme, and the setting or collection of rates during and prior to the Kaipara Commission’s term on behalf of the recently elected Council, including the following matters:

the Council’s legal action against the Council’s former chief executive;
any additional legal actions against any party relating to the development or operation of the Mangawhai Community Wastewater Scheme prior to 2013;
the judicial review action against the Council challenging the legality of rates and penalties relating to the 2011/12 to 2015/16 rating years (CIV-2015-488-95);
any additional legal actions against the Council relating to rates for the 2016/17 rating year and prior rating years; and
any legal action that is required by the Council to collect rates due for the 2016/17 rating year and prior rating years.

The Crown Manager is therefore able to:

direct the Council to act to address legal actions, including directing the Council to initiate new or discontinue legal actions within their management responsibilities;
make recommendations to the Minister of Local Government as to whether the Minister should take any further action in relation to the Council, including whether the Minister should appoint another Ministerial body to the Council; and
ensure, as far as possible, and to the extent authorised by these terms of reference, that the existing organisational capability of the Council is not diminished.

The Crown Manager is required to collaborate, to the extent that it is relevant, with the Northland Regional Council on challenges relating to rates set by Northland Regional Council and the collection of these rates by the Council.

The Crown Manager must act in good faith when directing the Council to initiate new or discontinue current legal actions within their management responsibilities. The Crown Manager must consider the merit of initiating new or discontinuing current legal actions against the costs and resources required when making his or her decisions. The Crown Manager must consult the Council before he or she decides to direct the Council to initiate new legal actions, or discontinue current legal actions. The Crown Manager must ensure that his or her directions are consistent with the legal obligations of the Council.

The Crown Manager will report to the Council and inform, as appropriate, the Kaipara community at least six monthly of the progress of legal matters within his or her management responsibilities. This must include any directions he or she has made, to assure the Council and community that their interests are being looked after.

The Crown Manager may make recommendations to the Council following Court decisions on the legal actions within their management responsibilities.

The Crown Manager may work with the Council’s chief executive and any other parties, as appropriate, to resolve the legal matters within their management responsibilities. The Crown Manager may request any assistance from the Department of Internal Affairs, or other parties he or she considers necessary to fulfil these Terms of Reference.

The Council is required, under section 258D(6) of the Act, to: co-operate with the Crown Manager so that the Crown Manager may fulfil these Terms of Reference; comply with the directions of the Crown Manager; and comply with any reasonable request of the Crown Manager to provide relevant information. Any expense incurred by the Crown Manager to fulfil these Terms of Reference may be recovered by the Crown from the Council as a debt to the Crown.

Term of the appointment

The Minister of Local Government may end the appointment and management period early by way of written notice, if the Minister is satisfied that the appointment is no longer required.

Remuneration and costs

The remuneration of the Crown Manager will be paid out of money belonging to the Council pursuant to section 258W of the Act. Remuneration will be paid in accordance with the Cabinet Fees Framework at a rate of $900.00 a day. The Crown Manager is responsible for ensuring any expenses claimed are reasonable and necessary.

Reporting

The Crown Manager must report, as appropriate, to the Minister of Local Government at least six monthly on the progress in fulfilling his or her Terms of Reference. The Crown Manager must provide a final report to the Minister of Local Government as soon as practicable after the management period ends. The final report must comply with section 258U of the Act. In addition, the Crown Manager must report on any potential problems that remain or any new related problems that have emerged. The final report may make further recommendations to the Minister of Local Government.

Protection from liability

Pursuant to section 258Y of the Act, the Crown Manager will not be liable for any act done or omitted by him or her in good faith in the performance or intended performance of his or her functions, responsibilities and duties, or the exercise of his or her power as a Crown Manager.

Dated at Wellington this 15th day of June 2017.

Hon JACQUI DEAN, Associate Minister of Local Government.