Controversial infrastructure funding tool in talks

Mayor Boult released a statement welcoming the consideration of the new infrastructure funding tool, despite potential harmful outcomes.

Queenstown Lakes District Mayor Jim Boult has welcomed the consideration of potentially controversial new infrastructure funding and finance tool. The bill is currently being read in the House with the bill hoped to be passed in mid 2020. 

This finance tool will provide councils with the opportunity to fund projects such as water and transport infrastructure and community amenities. Boult describes it as an opportunity to speed up much-needed infrastructure and said, “I, for one, welcome any innovative initiative that could help address the need for additional housing in the Queenstown Lakes district.” 

However, the financing behind this tool would be sourced directly from a levy, to be paid for by those who are expected to benefit from the infrastructure project. Typically, a levy would last between 25 to 50 years. A working example of this finance tool can be seen at Milldale, north of Auckland, where homeowners pay a levy of $1,000 for a home, over 30 years. This is on top of existing rates and taxes. 

The Wānaka Sun asked QLDC whether the cost to the ratepayer of $1000 per year for 30 years was a fair burden to place on new developments but the council declined to comment. The targeted nature of this levy at new developments could help contribute to the growing divide of wealth in towns such as Queenstown and Wānaka. 

Many, particularly young families, seek out new developments because they cannot afford and access the existing infrastructure, and this levy could either add to financial strain or once again lock them out of the market. The only question that QLDC could answer was in reference to the visitor bed tax which is expected to be introduced to parliament in 2020, saying: “QLDC remains on track to progress a local visitor levy with strong support from within Central Government.” 

In a general comment about the controversial infrastructure tool, QLDC did note that “At this stage we’re still developing our position in relation to a reasonably complex Bill. We will communicate on it when we’ve reflected appropriately,” despite Mayor Boult having publically welcomed the Bill in a press release.


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