Qtown council's bypass budget blows out (again)
Queenstown councillors have announced a further $17 million budget blowout on a bypass road; they say it is beyond their control, leaving the residents and affected businesses to pay the bill.
The first stage of an arterial road to bypass central Queenstown started with a $50m boost from the Government’s “shovel-ready” fund, to stimulate construction work during Covid-19.
The work started in 2021 with the Queenstown Lakes District Council committing to a $36.5m contribution, but that increased more than $20m last year, and another $17m yesterday.
The total cost now sits at $128.02m and councilllors have been warned a further increase can not be ruled out.
Council papers pointed to escalating construction costs, updated traffic management requirements, difficult ground conditions and unexpected issues with underground services, for the increase.
However, no papers mentioned the property owners who have been most directly affected by the construction work outside their homes and businesses for two-and-a-half years.
Cr Craig Ferguson visited some who had been living “behind the cage”, and in a report read to the council said the stress and anxiety on those people was immense.
Motel managers were nearly in tears relaying stories of constant bad reviews, guests walking out in the middle of the night demanding refunds, and the constant vibration of buildings, he said.
They had suffered from a lack of sleep, lack of communication and night workers blocking their access ways.
“I was appalled at the apparent lack of duty of care for the residents directly affected by this project,” Ferguson said.
Council finance manager Stewart Burns said the increased budget would be debt funded and would mean about a 1% rate increase for all residential Whakatipu properties for the next 30 years.
For average residential properties that would be about $18 to $31 per annum, and up to $112 for high-value properties.
Accommodation and commercial properties would pay the bulk of the cost with a 2.3% increase. That would be between $160 and $256 for average properties but up to $2000 for commercial properties or $6400 for a high-value hotel.
The residents of the Queenstown Lakes District faced one of the highest rate increases in New Zealand last year, with the 14.2% increase largely attributed to leaky homes claims.
Cr Quentin Smith said the council was wearing the pain of decisions it could not control.
The Kā Huanui a Tāhuna (Whakatipu Transport Programme Alliance) board members who were in charge of the project had not met with councillors, he couldn’t find the board member names online, and a review into their work from the previous budget increase had not been completed.
The board is made up of representatives from the council, Waka Kotahi NZ Transport Agency, Beca, Downer, Fulton Hogan and engineers WSP.
“There has to be some accountability and some relationship there,” he said.
Chief executive Mike Theelen said the review would be available in the next month. The delay was due to finding someone suitable to undertake the work.
Delaying the budget increase until the review was received was not recommended as it risked the project stalling or failing, Theelen said.
Cr Lyal Cocks said the Government money was a “big carrot” but the council had learnt a lesson.
“In hindsight we shouldn’t have been asking for $50m from Government, we should’ve been asking for at least $100m.”
If the project was not completed, the Government could recall the original $50m.
The council report also outlined risks of having a partially completed road and damage to Queenstown’s reputation as reasons the rates increase should be accepted.
Cr Niki Gladding was the only councillor who voted against the increase, preferring to look at options to rescope the work or consider a new management structure.
She estimated the wage cost of managers alone on the project could be $6m.
Cr Esther Whitehead said the council was in a terrible position. “We have all the accountability and none of the control.”
Stage one of the arterial road project will create a diversion off Frankton Rd, via Melbourne and Henry streets to Shotover St, removing general traffic from Stanley St.
The work is 54% completed with the road due to open in December, and the project for completion in March 2025.
Stages two and three of the project will link the road with the One Mile roundabout, at the Fernhill and Glenorchy Rd intersections, via Man St, avoiding central Queenstown. Those stages are not currently funded for construction.