Auckland Council and Crown agree to cost sharing agreement for storm recovery and resilience work

Last Updated : 10 Oct 2023
Our Recovery Budget (1)

Auckland Council’s Governing Body has unanimously voted to accept the proposed cost sharing deal with the Crown to fund more than $2 billion of flood recovery and resilience works, including buying-out Category 3 properties.

The decision today followed consultation with Aucklanders, in which more than 80% of submitters expressed support for the deal. 

The deal includes:
  • Making Space for Water initiatives: $820 million to fund projects that will help build resilience against future flood events, including the core aspects of the Council’s Making Space for Water initiatives. These initiatives include increased maintenance, stream rehabilitation, culvert and bridge upgrades, overland flow path management, and the roll out of “blue-green” networks in critical flood-risk areas (which are stormwater solutions that enhance parkland and open space).
  • Transport Network Recovery: $390 million towards the recovery costs of the transport network directly impacted by the storms. Example projects include Mill Flat Road Bridge, access to Karekare and Piha and underslips on the Bethells Road.
  • Category 3 buy-outs: $774 million to purchase an estimated 700 residential properties where there is an intolerable risk to life and it is not feasible to mitigate this risk.

The cost share agreement secures $1.076 billion of Government funding for these projects. This includes 62% of the estimated capital cost of the Making Space for Water projects ($380 million), 79% of the transport recovery costs ($110 million Crown funding and an expected $199 million from the National Land Transport Fund via Waka Kotahi), and 50% of the cost of Category 3 buy-outs ($387 million).

Decisions on buy-out scheme

Auckland Council’s Governing Body also made decisions today about how it was going to undertake the process of buying-out Category 3 properties.

Under the details of the agreed approach, insured Category 3 homeowners will be offered 95% of the pre-flood market value of their property. The remaining 5% of the property value will operate like an insurance excess.

Uninsured Category 3 property owners will be offered at least 80% of the pre-flood market value of their property, which may be increased up to a maximum of 95% subject to considering the special circumstances of those property owners.

Mayor Wayne Brown said that a fair balance had to be struck.

“Eight months on from the floods, many Aucklanders are still dealing with that devastation. We have agreed to the Government’s proposal to give them a helping hand out of it. That is the right thing to do.”
“On the other hand, we are asking all Auckland ratepayers to pay higher rates to make this happen. They will be paying off the debt associated with this decision for decades. I feel the weight of that responsibility. We are also on a fixed budget and had to be make decisions which gave us some confidence we could complete this process within the budget.”

“I particularly want to thank members of the affected residents’ groups who told their stories and have asked us to get on with this. I know it’s been really hard for you, and we listened.”

The Mayor emphasised that the approach must not been seen as a precedent for future buy-outs.

“As a Council we do not and cannot insure private properties against the hazards of coastal erosion and climate change. Rates are not insurance premiums. We have made it clear throughout this process that the government needs to come up with a national scheme, so we’re not just doing things piece by piece with future weather events.”
Making Space for Water and transport recovery

The deal also includes significant Crown support for Making Space for Water and transport recovery.

“As Mayor, I am particularly focused on the fix-up work required to make our region more resilient to future weather events. This deal will enable us to move faster on those plans, rolling out the Making Space for Water programme and reinstating a range of transport infrastructure to help our communities return to a sense of normal."

The Auckland Council Recovery Office will be in touch with affected residents with more detailed timeframes.

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