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Auckland Rescue Helicopter Trust loses court battle with funding board

The High Court has thrown out a bid by the Auckland Rescue Helicopter Trust to overturn the Auckland Regional Amenities Funding Board’s decision to slash its funding. 

The just released decision by Justice Susan Thomas says the board’s funding allocation was "not substantively unfair or irrational."

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.

In 2013/14, some amenities received an increase in funding while the funding board slashed the helicopter trust’s grant from $1.2 million to $900,000.

The trust asked the High Court for a judicial review, saying the board’s decision was illegal, unfair and "inconsistent" with the Auckland Regional Amenities Funding Act 2008.

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. It’s using the surplus to save for a new helicopter.

In 2009, the trust flew 519 missions. Last year, it flew 834. For the year-ending June 2014, the trust expects $5.2 million raised from other sources with $2.53 million for expenses and the balance going toward a new helicopter.

Despite the uptick in need for the service, the funding board says other amenities haven’t been as successful in raising funds, with five of the not-for-profits operating at a deficit.

Auckland Council last week agreed to pay $400,000 in legal bills to the funding board for the High Court squabble.

Also last week, Auckland Council approved the funding board’s 2014/15 fiscal year proposal to further slash the trust’s grant in half from $900,000 to $450,000.

The trust announced plans to bring additional litigation against the board relating to the recent 2014/15 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 latest budget report shows a $16 million shortfall and that doesn’t account for the $900,000 in additional funding mentioned by Mr Brown.

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.

sflores@nbr.co.nz

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Comments and questions
25

Will the Helicopter trust be liable to pay the council legal fees ?

Why should they? What kind of Council do we have that increases money on the Arts (for a very limited audience, that should be self funded as art is a non-core expense) at the cost of a service that saves lives and has real use in the community?

Because they went to court and lost?

Was meaning because they should never had to have to argue their case against the money given to the frivolous groups who had their funding increased. As a ratepayer I am more interested in saving lives than artworks. The Council has their priorities totally wrong.

So more has been spent in legal fees than the difference in funding? Where's the sense in that?

Why can this not be sorted without lawyers?

Auckland councillors agreed to pay $400k in legal fees and an additional $315k for the funding board's "administration" fees for the fiscal year. Several councillors were not happy they were paying more for lawyers' bills than management of the funding board in a single year.

To be very clear. Councillors agreed to spend $400k of ratepayers money.....

The judge did not order costs, so that has yet to be seen.

Instead, she told the parties to work it out. If they cannot agree, then the respondents (funding board) must file submissions within 28 days of this decision (yesterday) with the helicopter trust given seven days to respond.

The saga continues ....

If the council wants to save money they should close down ATEED. This is a council funded business promotion organisation that has no right to be funded by rate payers.Why should we be paying for them to fly around the world first class to promote Auckland.

Agreed.

out of control

An unsurprising and sensible legal decision.
One would expect the helicopter trust to be in the gun for the majority of the costs.
It seems obscene that a the financially successful helicopter trust through the generosity of Aucklanders and others and commercial sponsors could think it has the right to tell the Auckland Council how it must allocate limited Council (ratepayer) funds. Along with the accompanying emotional blackmail indulged in.
Time for the helicopter trustees to pay the price for wasting large amounts of the trust funds they have been entrusted with as well as Council funds, on their misguided legal adventure. Such adventurous and risky conduct, while it may legitimate "private equity" conduct, does not fit the responsibilities of being a trustee.

Hope the Auckland Regional Amenities Funding Board members aren't looking forward to a ride in the helicopter as much as they do to receiving free tickets to the opera.

Just hope you and yours never have a car accident and require urgent transport to a hospital. Fat lot of good a Rembrandt will do you then. Priorities are screwball.

Is this the helicopter trust with board member Michelle Boag who got the helicopter to fly to the airport from Waiheke to collect the passport she had forgotten.

She did pay for the flight according to this report: http://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=10369999

The helicopter trust should not be funded by Auckland Council but by the District Health Boards

District health boards pay part of the costs, as does ACC.

What is the Trust's "admin fee" to administer this service as in the past some "Charitable Trusts" have been charging upto 99%.

I see Murray Bolton of the Westpac Helicopter Trust acknowledges they didn't have much of a case but he thought it was worth a try - meaning well over $500,00 was spent on the lawyers - I hope the trust gets rid of him for wasting money and time.

The ARAFB is yet another in a long list of jobs for the boys and girls. have a look at whose on it. All cronies of someone. Time we kicked these waste of oxygens into touch. The Council should be the sole authority to disburse ratepayers monies nota bunch of unelected wannabes. Same with the CCO's. Buck passing by the Council. No point in electing Councillors if they don't do the job they are elected to do.

One could start by asking why are the Auckland Rescue Helicopter Trust costs so much higher than the other rescue trusts in NZ that do the identical kind of work?

Secondly of those missions (some 800+ annually) how many were training compared to real SAR, hospital or ambulance work?

Lastly, why do the need a NEW (high capital cost) helicopter when the 2 they have more than adequately do the job, in the eyes of the rest on the EMS operators in New Zealand?

The helicopter trust appears to run as a business, not as a chsrity. They have 18 fundraisers as well people like Matthew Hooten and Michelle Boag as consultants who must use up a fair bit of money . And I bet that even though they are a charity the board members will be raking in many thousands of dollars

And those in the art world who benefit from the board's handouts work for free?

Dont see why the council should have to fund the rescue helicopter. If its so vital to the greater auckland region then the funding should come from government as part of the funding for the health system.