Big decision 3: Developing a new wastewater system in Darfield and Kirwee
Consultation has concluded
Darfield is one of the largest communities in New Zealand that doesn’t have a reticulated wastewater network. Following consultation with affected communities in 2019 and early 2020, the Council has agreed to develop a reticulated wastewater scheme in both Darfield and Kirwee. We are now asking for feedback on proceeding with this scheme, and on our proposals for how it is to be developed and funded.
Connections to the proposed Darfield and Kirwee wastewater network will be rolled out over a number of years. Stage 1 will enable connection to properties in central Darfield and new growth areas in Darfield and Kirwee. This will take place during 2021/22 and 2022/23. Stage 2 and stage 3 involve extending the network to other existing properties in Darfield and Kirwee, which is expected to start from 2024/25 and 2025/26.
Check out these Q&As on the proposed project, which we've pulled together in response to queries received so far.
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Connect to the Pines wastewater treatment plant in Rolleston
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This would provide connections for central Darfield and growth areas of Darfield and Kirwee, and provide capacity for the existing residential properties over time. For more detail on the location please check the map above.
Impact on rates
Funding this development will be achieved through:
- Government stimulus grant of $10 million
- Borrowings of $28 million, to be repaid through rates on existing properties which benefit from the scheme, and development contributions for future new properties.
The information below summarises the financial impact on current ratepayers who benefit from this scheme, and those who will benefit in the future through new developments.
Assuming a ratepayer connects their property to the proposed scheme in 2025/26, the total cost of connecting will be as follows:
A. Existing properties
A share of the Council’s cost of the capital works to build a new local wastewater infrastructure network, plus the connection to the treatment plant in Rolleston
Approximately $17,360 in 2025/26
The property owner’s own cost to physically connect their property to the scheme. The cost for most properties will be around $5,000. For some properties that are set further back from the road the cost will be around $20,000
Approximately $5,000 to $20,000 depending on the type of connection
Approximate total cost
$22,360 to $37,360
The share of the Council’s cost of the capital works can be charged to ratepayers as an annual targeted rate. This will not cover the cost to physically connect the property to the scheme, which will need to be paid by the property owner. The targeted rate is based on an interest rate of 3%, with rate payments being made for 40 years. The amount will change as interest rates change. In addition to the annual targeted rate, ratepayers will also pay the annual district-wide rate, which is paid by all ratepayers that are connected to a Council wastewater system. The estimated rate increase for a typical residential ratepayer in Darfield and Kirwee, assuming connection being available in 2025/26, will be:
2025/26 $
Targeted rate for capital works
751
Annual operations rate
659
Total annual rate
1,410
Less sewerage investigations rate
(89)
Net increase in rates
1,321
Properties that constitute more than a single household unit equivalent (HUE) will pay an additional $6,085 per HUE and this will increase the loan rate proportionately.
B. New properties
Land developers in Darfield and Kirwee will be able to connect to the new scheme by paying a development contribution. This will be used to fund a proportionate cost of the connection to the treatment plant in Rolleston. It will not cover the cost of local reticulation within the subdivision which must be provided by the land developer. Subject to consultation on amendments to the Development Contributions Policy (see p. 45), the amount payable will be $6,085 (including GST) per HUE assuming a connection in 2025/26.
There is some uncertainty around the funding of future capital works for wastewater, as the Government is proposing to reform the provision of this service. This may mean there will be a different way of paying for the proposed new scheme. The impact of the proposed reforms is not known at this time.
Cost
The total cost of the capital works required to reticulate the two townships, construct the pipeline to connect to the Pines wastewater treatment plant and pay for a share of the cost of the treatment plant is $38 million. The work will initially be funded by borrowing and by a one-off Government stimulus grant of $10 million.
The Council’s decision to use the Government’s stimulus grant to fund the pipeline means the cost per house has been reduced by about $5,000.
Impact on debt
We would need to borrow an extra $28 million. This would be repaid by ratepayers in Darfield and Kirwee through a local targeted rate ($17 million), and by land developers benefiting from the new wastewater system through development contributions ($11 million).
Option 1 is our preferred option, based on the environmental and public health benefits of a modern, reticulated system, as opposed to septic tanks. This option will also better provide for the ongoing population growth this area is experiencing, allowing for sustainable intensification of development and a wider range of housing types.
As noted above, the Council has a one-off opportunity to access Government stimulus funding for this project, which reduces the overall cost to households.
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Status quo – keep septic tanks
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Cost
Cost of getting a new septic tank ranges between $10,000 and $25,000.
Cost of operating and maintaining a septic tank ranges between $190 and $720 per year, depending on type of tank and what regular checks are required.
Impact on rates
No impact
Impact on debt
No impact
