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Auckland councillors to vote on amenities funding today

Auckland councillors will today vote on the Auckland Regional Amenities Funding Board proposal, which includes cutting next year’s grant in half for the Auckland Rescue Helicopter Trust.

The funding board, created by statute, makes grant recommendations to the Auckland Council for 10 amenities, with safety and arts organisations vying for dollars from the same funding pool.

The trust, which runs the Westpac Rescue Helicopter, has been running at a surplus from donations as well as reimbursements from ACC and district health boards for contracted flights. The other amenities haven’t been as successful in raising funds, with five of the not-for-profits operating at a deficit.

The funding board’s $14.3 million proposal calls for slashing the trust’s grant in half from $900,000 to $450,000 for the 2014/15 fiscal year. The New Zealand Opera would receive the same $800,000 grant as the year before and the other eight amenities would all see increases ranging from $20,000 to $150,000 (see table below).

Auckland Council can today approve or reject the total $14.3 million levy but cannot decide how the funding is allocated among the groups.

The total levy would be a “modest” 1.5% increase from nearly $14.1 million in 2013/14, when the helicopter trust saw its grant drop from $1.2 million to $900,000.

The trust has asked for a judicial review of the 2013/14 decrease in funding. The High Court heard arguments and reserved its decision last month.

The trust announced plans to bring additional litigation against the board relating to the 2014/2015 cuts but has since dropped those plans after mayor Len Brown signalled the council could step in.

“I want to work with my council colleagues through the annual plan to remedy the immediate $900,000 funding gap for the helicopter trust in the 2014/15 financial year,” he said in a March 13 statement.

The mayor’s office declined to comment ahead of today’s general meeting.

The annual plan process, which is under way, will consider whether the council will make a contribution to the rescue helicopter trust but those final decisions are expected in June.

“We are supportive of the mayor’s input and review,” says Vanessa McKee, spokeswoman for the trust.

In an update to be presented to the budget committee later today, staff has identified $25.39 million in cost pressures not accounted for in the draft annual plan, and $9.45 million in interest and dividend income from Auckland Council Investments.

The result is a net $16 million shortfall, which staff says needs mitigation over the next six weeks to achieve an average rates increase of 2.4% proposed in the annual draft plan.

The annual plan projections, so far, do not take into account additional funding for the Auckland Regional Helicopter Trust, today's budget report says.

Following annual plan hearings, staff will report to the budget committee on May 8 any progress to mitigate costs and “further inform the mayoral-led process of deciding on the final budgets for 2014/2015,” the budget update says.

Although the helicopter trust agreed to drop further legal battles, it hasn’t dropped its complaint to Controller and Auditor-General Lyn Provost asking her to investigate the operations of the funding board, going back to 2009.

Since 2010/11, the funding board has allocated $66 million of ratepayer funds with no written or other publicly available criteria in allocating funds, a trust statement says.

The helicopter trust has said both in a statement and at the High Court it needs the surplus because it is saving up for a new helicopter. NBR understands the helicopter trust returned a $3.4 million surplus last year and expects similar results this year. Income is from donations, sponsors and reimbursements from ACC and district health boards for contracted flights.

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Comments and questions

With the council in the red financially, all spending on non-essential infrastructure should be cut immediately and left that way for the foreseeable future until such time as rates subside to a sensible percentage of average income. The council and all entrepreneurial departments need to live WITHIN current income, just as we do.

How much money could be saved by getting rid of Mr Vern Walsh