The case of the planned “Safety Improvements” for Te Aroha Street/Ruakura Road
... and how your Council turns raised crossings into intergenerational debt.
The proposed “Safety Improvements” project on Te Aroha Street is a discussion worth having because it highlights a wide range of serious problems with how Hamilton City Council operates. It is a large project which is currently on hold. Many similar, but smaller, projects have been built and have already burdened Hamilton with debt, speed humps, and in-lane bus stops.
A version of the Te Aroha/Ruakura “Safety Improvements” project still sits on the Council website, stuck in “planning” status and awaiting approval. If any future government resumed NZTA funding of speed humps, then the planned “Safety Improvements” could be resurrected in time for the official project completion date of 2030 for the wider “Eastern Pathways School Link” project.
Despite repeated official information requests, Hamilton City Council has been slow in making the latest version of the project plan available in a digital form. Lack of transparency is one of the major issues with our City Council.
Based on what is available on the Council’s website, and my viewing of physical plans at a public meeting, the proposed project appears to involve the following major changes:
Re-designing and re-arranging the whole road between the Te Aroha Street roundabout through to Ruakura Road outside Mitre 10.
Installing over ten raised crossings. The plan has raised crossings on every side street, plus a few more raised crossings on the main roads.
Converting the intersection of Te Aroha Street and Peachgrove Road into a raised intersection (effectively one large speed hump).
Creating new bike paths and wider shared paths by narrowing the road.
Removing carparking space for over 40 cars along Te Aroha Street.
Installing six new in-lane bus stops, so that buses can routinely obstruct the roadway while passengers embark and disembark.
Reducing the number of lanes “from four lanes to two” along Ruakura Road between Peachgrove Road and the Wairere Drive intersection.
Removing some existing trees, landscaping, and installing “rain gardens”.
Reducing the speed limit from 50km/h to 40km/h.
The project is budgeted at over $13 million, a large part of the “Eastern Pathways School Link” project which is expected to cost somewhere between $26 million and $30 million. New Zealand Transport Agency (NZTA Waka Kotahi) was going to cover half the cost, until the new government restricted the funds flowing to speed hump projects.
Reducing the number of lanes on Ruakura Road is expected to cause issues for vehicles accessing the Mitre 10 Mega, the self-storage facility, and the retirement village. These are busy locations on a busy road; with many trucks, trailers, and cars turning in and out of each location.
Narrowing the roads and adding extra obstacles creates difficulties for emergency vehicles passing through, especially when traffic is heavy and other vehicles need to pull over safely.
Raised safety platforms and in-lane bus stops are unpopular with vehicle drivers, especially when installed on a busy road. This project would have installed the largest number of both unwanted features for any single project in the history of Hamilton. The notorious Rifle Range Road “Improvements” had a budget of around $2.8 million. This project on Te Aroha Street and Ruakura Road is approximately four times the size in terms of budget.
The situation with the Te Aroha/Ruakura “Safety Improvements” gets worse.
Council put a brochure about the project in letterboxes in late 2023. The brochure hid the fact that all the new crossings would effectively be speed humps and that over 40 carparks would be removed. The brochure wasted a lot of page space on cartoons, yet omitted critical details such as expected project costs and how many months of construction-related disruptions were likely.
The brochure also omitted the total number of in-lane bus stops and raised crossings, as if Council staff were aware that giving people too many key facts would raise more opposition to the project.
This is another example of Hamilton City Council publications being promotional rather than informative. I consider this bad faith dealing by the Council towards Hamilton’s residents and ratepayers. This type of behaviour by Council is unacceptable and needs to stop.
The excessive use of cartoons in brochures is also insulting. The City Council is treating the people who pay their salaries as if they are preschoolers. More worrying is the possibility that some influential Council officials do actually see the world in cartoon terms.
The “Safety Improvements” project on Te Aroha Street is also significant because it confirmed the disturbing link between raised crossings and the City’s growing levels of intergenerational debt. If you think it is a bad idea for the City to get further into debt in order to build speed humps, the situation is probably much worse than you think.
It appears that Hamilton City Council has been building speed humps and in-lane bus stops for the purpose of increasing the Council’s debt limit.
On Page 46 of the agenda for the Hamilton City Council meeting on the 20th of February 2024, Council staff explained how the scheme operates.
“61. Given the government’s stated priorities on transport, staff believe there is a growing risk that NZTA Waka Kotahi will not provide the expected subsidy of $14 million over the first three years of the Long-Term Plan for the Eastern Pathways School Link (Te Aroha St) project.
62. As well as meaning that project would not be able to go ahead (unless we can find replacement funding), this would have a significant impact on our debt to revenue ratio noting we are already close to our limits. Every $1 million of revenue that Council loses represents $2.8 million it cannot spend.”
Item 8, on page 46 in the 20 February 2024 Hamilton City Council Agenda v2
Hamilton City Council has been treating the funding (project subsidies) from the NZTA as “revenue” on the Council’s books. The Local Government Funding Agency (LGFA) was allowing councils to get into debt to a limit set at 280% of the council’s annual revenue. Hamilton City Council often was operating very close to this debt cap or borrowing limit. It appears that Council staff use NZTA funds as extra “revenue” to allow extra borrowing. Had the project on Te Aroha Street (and the wider “Eastern Pathways School Link”) gone ahead, Hamilton City Council could have used the $14 million of project funding from NZTA to get the City $39 million deeper in debt.
In principle, setting a debt-to-revenue limit is to make sure that a council has enough regular income (mostly from rates) to financially support its level of borrowing. NZTA funding is provided for individual projects, they are not a recurring or stable income stream. If council stops getting as many projects each year subsidised by NZTA, then total council revenue could fall. Extra borrowing means more annual interest on that debt. Borrowing against ‘windfall’ NZTA funding is irresponsible. Part of the rates increases could be to cover the “revenue” shortfall created by having too many extravagant NTZA projects subsidised in the past and not enough subsidised projects in the present.
For an organisation deliberately operating very close to its debt-to-revenue limit, this situation creates a perverse financial incentive to go for more expensive options on roading projects. This could explain why each raised crossing costs around $300,000 to install in Hamilton. A $30,000 raised crossing would only allow the Council to borrow an extra $42,000. If the cost for that raised crossing happens to be $300,000, the Council can use that speed hump to borrow $420,000. These estimates are for a typical NZTA subsidy of about 50%. Many of Hamilton’s raised crossings and in-lane bus stops were installed using the 90% NZTA subsidy provided by the “Climate Emergency Response Fund”. Under that particular scheme each $300,000 raised crossing represented an opportunity for the City Council to borrow $756,000.
These dubious financial machinations are something to consider every time you crunch your vehicle over another raised crossing or wait behind that new in-lane bus stop.
It appears that the large numbers of raised crossing and raised platforms installed throughout Hamilton City were part of the journey to get the Council over $1 billion into debt.
Hamilton City Council should have internal financial discipline, keeping spending and borrowing within what the community decides is acceptable. Instead, we have had external organisations such as LGFA and credit rating agencies determining what is an acceptable debt level, while Council staff have developed schemes to push that debt limit even higher.
The only solution is a changing the councillors, and supporting them to reform the Council bureaucracy. Our new councillors must keep a close eye on council finances and stop these debt creation schemes. These new councillors must possess the technical skills to address the current bureaucracy and challenge the culture of wasteful spending. They need to be capable of deeply investigating situations and be willing to genuinely consult the community, rather than just approve projects based on recommendations from Council staff.
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