Rotorua wastewater contract process 'transparent as brick' - expert

"About as transparent as a brick wall"; that's how a local government expert describes processes surrounding Rotorua Lakes Council's proposal to outsource wastewater management to an international consortium.

Locals have been writing en masse to Local Government Minister Nanaia Mahuta, asking her to step in to stop the proposal to give the contract to the consortium, headed by Hong-Kong owned firm Trility.

Tomorrow the council will decide whether to proceed with the proposal, which if approved would see it enter a 10-year, $156 million contract with the companies to manage the district's wastewater services.

The consortium is made up of Trility, Canadian company Stantec and New Zealand's Fulton Hogan.

The council would not immediately answer questions about the contract or the process surrounding the proposal when approached by the Rotorua Daily Post.

Council chief executive Geoff Williams said: "This matter will be discussed and a decision will be made by the full council at their meeting tomorrow. It would be inappropriate to comment further on this prior to then."

Massey University local body governance expert Dr Andy Asquith said, in his view, there were "significant weaknesses" in the governance process in this case.

"I don't think that good local governance has been particularly well served."

That was because of the speed of the decision, the underlying rationale for the proposal, and the relevance of the government's $761 millionwater reform announcement on 8 July.

He said it would be "prudent to wait" to see what shape the national water reform would take.

"It seems a bit hasty to me."

Asquith said having a public-excluded workshop before a meeting last Thursday was, in his view, "bad governance".

"Local government is about engaging with people ... it doesn't smack of trust, faith and empowerment. It's about as transparent as a brick wall."

Local Government NZ principal policy advisor Mike Reid said the organisation did not take a view on specific councils' processes, but had confidence in them to follow good process.

Generally speaking, "good process" meant elected members were familiar with issues, understood the significance of decisions before them, had access to and understanding of all necessary information and were approaching the decision with an open mind.

Ultimately, considerations as to whether, for example, government reforms or Environment Court processes could impact decisions, was "up to elected members to make that call, based on the information they have".

When it came to public submissions, councillors were not legally compelled by the number of submissions for or against, but were legally required to take all the information into account. They could then balance that information with other evidence.

Councillor Sandra Kai Fong said the discharge issue for the Rotorua wastewater treatment plant - now before the Environment Court - was identified as a "real risk" for the Trility proposal, and the Trility contract "does not appear" to mitigate that risk.

She wanted to know how the outcome of that process, as well as tendering and building the new treatment plant, would impact the proposed contract.

She said the first briefing councillors received on the government's water proposal was on Thursday at the pre-meeting workshop.

"I didn't think that gave us enough information to understand the implications or opportunities we should, or could, consider before entering into a 10-year contract."

Councillor Fisher Wang, who abstained from the vote on Thursday, said he did so because he still had some unanswered questions about the proposal.

"I want to be 100 percent sure in the decision I made. After the workshop ... it cleared up a lot of questions I had, but there are still a few aspects of it ... that I just wanted cleared up."

Those aspects include how the "unstable political environment" - Covid-19 and civil unrest in Hong Kong as examples - might impact the council's agreement with Trility, and the flexibility of the contract to adapt to future government reform in the sector.

He said he had been seeking answers ahead of tomorrow's council meeting, and would decide his position when he had more information.

On Sunday, Councillor Tania Tapsell told the Rotorua Daily Post she had voted in support at the committee meeting on Thursday, because she saw merits in the proposal, but was "continuing to investigate further", and would make her final decision on Wednesday.

Councillor Merepeka Raukawa-Tait said the public consultation raised some "very good points" about the contract, the potential cost of any contract breaches and local employment.

The pre-meeting workshop had provided her with "the assurance I needed to fully support the recommendation", she said.

Raukawa-Tait said the public had many opportunities over the past five years "to become familiar with what was being proposed".

"This is a leadership decision that requires councillors to vote one way or the other. You can't sit on the fence on this one."

Councillor Reynold Macpherson had taken to Facebook to urge Rotorua Residents and Ratepayers followers to write to all council members, the Local Government Minister and the Rotorua Daily Post about the proposal.

Of the 14 emails sent to the Rotorua Daily Post by Tuesday afternoon, 10 opposed the proposal and four requested the process be slowed down.

Local Government Minister Nanaia Mahuta said central government had been working with local government on "three waters" (waste water, drinking water and storm water) challenges for the past three years.

A Department of Internal Affairs spokesperson said it was up to councils, as owners and managers of water assets, to make decisions on how to deliver water services.

Asquith's comments were put to mayor Steve Chadwick, but she did not respond.

Councillor Mercia Yates supported the passage of the proposal through to the council but did not want to comment.

The council said it would treat the Post's questions as an Official Information Act request, which meant it should respond as soon as possible, but within 20 working days.

The questions included what the expectations were if the consortium withdrew from the contract or if the council withdrew or varied the contract - including because of an offer from government - and questions about the timing of the decision-making process.

Local Democracy Reporting is a public interest news service supported by RNZ, the News Publishers' Association and NZ On Air.