Part of Napier Port will be sold to free up cash to pay for protecting the region from climate change, Hawke's Bay Regional Council has decided.
The decision came as the council was warned it faced a $400 million bill to pay for the cost of upgrading flood protection schemes, and mitigating coastal erosion and sea level rises could cost more throughout the region over the next 50 years.
After more than three hours of deliberation, the voted now paved the way for up to 45 percent for a minority stake to be listed on the NZX, clearing the port's $80m debt and raising much needed cash for a new wharf.
It was a bill that the council has not been keen to pay and during the consultation period it had warned ratepayers that if it did rates would rise by 53 percent next year.
Hawke's Bay Regional Council chief executive James Palmer warned today that it would be on top of double-digit rate increases needed to pay for cleaning up the region's rivers and environment.
It could also cost between $200m to $300m to protect the region from coastal erosion and sea level rises, while another $100m would be needed to make stop banks higher to protect against a one-in-500 year flood.
These costs would "get us to the upper end of comfort range in terms of the council's balance sheet," he said.
Councillor Rick Barker said he'd always been against selling public assets. But not this time.
"This region needs this council to be in the best possible position it can be to take on environmental issues.
"We have to stop erosion, we have to defend our cities with appropriate stop banks...all these things we will have to do in a short period of time. If we load this council up with debt over the next 20 years we will restrict future councils ability to manoeuvre," Councillor Barker said.
Councillor Neil Kirton said the Port was no longer a good investment in light of all the other demands the council now faced.
"It was a wonderful investment at the time, but now our time has come...to make those commitments to the environment that we have neglected over the past couple of decades."
Councillors Debbie Hewitt and Paul Bailey were the only two to vote against the port's sale.
Councillor Hewitt said she was "uncomfortable" with an IPO with the current market volality and she believed a long-term lease would be a better option.
Councillor Bailey said he did not agree with the sale of any public asset.
"I believe in this concept that the port is a strategic asset for the region so it needs to be retained 100 percent. I don't believe a sell down, or an IPO is 100 percent necessary," he said.
But seven other councillors believed it was necessary, and the vote in favour of the sale now paved the way forward for a stock market listing sometime in the middle of next year.