Addendum Agenda of Ordinary Meeting

Ordinary Meeting

Meeting Date: Tuesday, 24 October, 2017

Location: Council Chambers, City Administrative Building, Bridge Road, Nowra

Time: 5.00pm

Membership (Quorum - 7)

All Councillors

Addendum Agenda

Committee Reports

CL17.293..... Report of the Childrens Services Reference Group - 16 October 2017........ 1

CS17.13...... Revised Terms of Reference

Reports

CL17.294..... Grant Programs.............................................................................................. 5

CL17.295..... Pathway to Financial Sustainability - Special Rates Variation ..................... 8

CL17.296..... Draft End of Year Financial Statements ...................................................... 11

Addendum Agenda - Ordinary Meeting – Tuesday 24 October 2017

Page 5

CL17.294 Grant Programs

HPERM Ref: D17/341236

Group: General Manager's Group

Attachments: 1. Stewart Place Business Case (under separate cover) ⇨

Purpose / Summary

“As part of the NSW Government’s $1.3 billion Regional Growth Fund, funding will be made available through the Growing Local Economies fund over four years to turbocharge new regional economic opportunities and enliven local economies.” This report sets out the processes involved and project guidelines.

Recommendation

That Council note the report and councillors participate in the workshop on 22nd November before deciding what projects it will pursue under this grant program

Options

1. That Council note the report and councillors participate in the workshop on 22nd November before deciding what projects it will pursue under this grant program;

Implications: this allows further consideration of the program, project options and discussion with the community/business members and local MPs before a decision is made to select projects for application.

2. That Council select one or more projects for immediate consideration and preparation to submit as an application pending further discussion at the workshop and consultation with local MPs.

Implications: consultation with local MPs can still occur but work on preparation for one or more projects could commence at an early stage. If Council did select Stewart Place as a project then a budget allocation as highlighted in this report would also be necessary.

3. That Council make further decisions.

Background

The Growing Local Economies fund is one package of the Regional Growth Fund.

Details are available at https://www.nsw.gov.au/improving-nsw/regional-nsw/regional-growth-fund/growing-local-economies/.

Some of the key points are:

· Supports projects of economic significance. This could include road works, natural gas mains and pipelines, water supply, sewerage connections and telecommunications (including data networks);

· Wherever possible, projects should support local procurement, job creation and skills development;

· Open to projects that:

o have the capacity to deliver jobs and economic growth

o help regional communities capitalise on their strengths or broaden and reposition their industry base

o demonstrate benefits beyond one organisation

o have a minimum project size of $1 million

o align with state and regional priorities and achieve Benefit to Cost Ratio greater than 1.0.

· Eligible projects will be assessed against four program criteria:

o Criteria 1: Strategic assessment

o Criteria 2: Economic assessment

o Criteria 3: Affordability

o Criteria 4: Deliverability

In considering any possible projects Council has been advised that it needs to engage with the Department of Premier & Cabinet (DPC) and local State Members of Parliament to discuss proposals.

Projects must also be consistent with the Regional Economic Development Strategy (REDS) which is currently being compiled by consultants engaged by the DPC. Council’s Economic Development Manager has been liaising with the consultants providing input into the REDS with suggested infrastructure projects. It is proposed that a draft REDS will be considered at the next meeting of the Business & Employment Development committee (22 November - all councillors invited) with the Strategy completed by year end.

Council may commence work on Project applications now if it wishes. One project that has been suggested is the redevelopment of Stewart Place. If this was supported by Council extensive preparation work will be necessary to:

§ Develop a Concept

§ Council/Community/Business Chamber to agree to scope

§ Feasibility analysis

§ Business case development

§ Financing plan

§ Geotech & other site investigations

§ Quantity Survey & Estimates

§ DA process - Project Plan

The cost to undertake this work is significant (possibly $250k or thereabouts).

An application for “Stewart Place Activation Strategy” was previously submitted under the Commonwealth Building Better Regions program and was unsuccessful. This project scope involved site investigations to make the property more “marketable” for possible redevelopment as commercial, retail and housing uses with carparking a less dominant use. The “Business Plan” is in attachments for reference.

At the recent Councillor Briefing on Thursday 19 October Megan Cleary, Business Development Manager, Office of Regional Development, Department of Premier and Cabinet advised that the consultant will facilitate a workshop session on 22 November as part of the consultation to finalise the REDS.

A copy of the General Manager’s presentation from this councillor briefing is also on the Hub.

Community Engagement

Community engagement relating to the finalisation of the REDS will be via the membership of the Business & Employment Development committee. It is suggested that some members of other key committees be invited to participate. No further specific engagement is proposed in relation to Council selecting its preferred project(s) for submission as applications.

Policy Implications

Projects selected for submission will need to demonstrate relevance to the REDS, other Regional Strategies and Council’s Integrated Strategic Plan. There is a clear focus on “infrastructure” that facilitates strong economic & job outcomes.

Financial Implications

It is understood that the funding available is significant for this region. The total funding under the program state wide is $500M. Projects above $1M are required and it is feasible that projects with a cost of $15M to $20M may be eligible. Council needs to ensure that any project delivered can be financially supported (maintenance, operating costs) in future budgets if necessary. This will be an important part of the Business Case.

Risk Implications

To avoid risk of “failure” Council needs to ensure that any project has a strong Business Case and meets the criteria to a high level. It will also need political support (local MPs), and business support (various Business Chambers and the Business & Employment Development committee).

Addendum Agenda - Ordinary Meeting – Tuesday 24 October 2017

Page 8

CL17.295 Pathway to Financial Sustainability - Special Rates Variation

HPERM Ref: D17/343730

Group: Finance Corporate & Community Services Group

Attachments: 1. Chapter 1 - CSP (under separate cover) ⇨

2. Chapter 2 - DPOP (under separate cover) ⇨

3. Chapter 3 - Financials (under separate cover) ⇨

4. Chapter 5 - Budget and Capital Works (under separate cover) ⇨

5. Chapter 6 - Resourcing Strategy (under separate cover) ⇨

6. Chapter 7 (under separate cover) ⇨

Purpose / Summary

This report highlights the need for and changes to, the Integrated Strategic Plan (ISP) to inform and engage with the Shoalhaven community and achieve IPART requirements for a Special Rate Variation application.

Recommendation

That Council:

1. Adopt the proposed changes to the Integrated Strategic Plan, inclusive of the changes made to the Delivery Program, Operational Plan and Long Term Financial Plan (LTFP), for exhibition purposes;

2. Publish the updated document and proceed with community engagement on the proposed document changes and its impact on the community.

Options

1. Adopt the amended Integrated Strategic Plan (ISP) as attached and exhibit as part of the community engagement undertaken for the proposed Special Rate Variation (SRV).

Implications: Council will be in a better position to achieve its Fit for the Future targets, retain existing services and provide the community with necessary maintenance of existing assets to meet community needs.

2. Not adopt the amended ISP

Implications: Council will need to reduce spending and, in turn, reduce service provision to the community to enable council to meet Fit for the Future targets.

Background

At the Extraordinary Council meeting on 17 October 2017, Council considered the report CL 17.280 Pathways to Sustainability – Special Rate Variation. At this meeting, Council resolved the following:

RESOLVED (Clr Findey/Cheyne) MIN17.895

That:

1. Council adopt the proposed changes to the Integrated Strategic Plan (inclusive of the changes made to the Community Strategic Plan, Delivery Program, and Long Term Financial Plan) for exhibition purposes, in addition to the following;

a. For the 2017/18 and next financial year 2018/19 the $10,000 from the Aerial Beach Patrol be used for beach safety signage

b. The funding of $4.5million for the Vincentia Library be deferred to a subsequent year pending a workshop

2. The Long Term financial plan be fully updated prior to exhibition to reflect the changes outlined above as well as changes to potential loan borrowings resulting from consideration of the impacts of the North Nowra Link Road and Collector Roads and the update be distributed to Councillors prior to exhibition

3. Council include from the rate increase $500,000pa to the upgrade of our sporting fields (Refer to Report SA17.270)

4. A report be submitted to the Ordinary meeting of 24 October 2017 outlining the above.

CARRIED

In relation to the above points the following is provided:

· The $10,000 donation for the aerial patrol has been removed from the Donations list. The funding will remain in the Swim and Fitness Centre budget and has been allocated to beach safety signage. This change does not affect the LTFP indicators.

· The $4.5M for the Vincentia Community Centre Library has been deferred by a further 12 months. This should allow Council sufficient time to complete the workshop and set a direction. This project is now scheduled for 2019/20 and is shown as funded from borrowings of $1.1M in 2019/20, with the balance from S94, S94 recoupment and S94 matching funds. The impact on LTFP indicators is shown from 2019/20 onwards, namely, reduction in cash, inclusion of interest payments, addition of assets and associated depreciation and additional maintenance.

· There was loan funding allocated in 2018/19 of $5,016,677 and 2019/20 of $9,000,000 and North Nowra Link Road reserve funding of $283K. This was set against Nowra Strategic Roads. Council has made no decisions in relation to this matter, so the funding has been removed. The impact of this on the LTFP indicators is by way of a reduction in liabilities, reduction in interest payments, reduction in assets and associated depreciation and reduction in maintenance in the outer years. Council has previously adopted the “Nowra Key Roads Projects” strategy and it is suggested that the loan funding be reinstated to deliver the highest priority projects of East Nowra Sub-Arterial, improvements to the Yalwal / Albatross Road intersection and design phase of Yalwal Road to Hillcrest Avenue link road over the period 2018/19 to 2020/21. The funding requirements for these projects will be confirmed as the designs are advanced, with the provisional allowance included in the budget.

· $500,000pa for upgrades to sporting fields has been included as asset additions as part of how the proposed Special Rate Variation will be spent over the planning horizon. This has no impact on the KPI’s.

Community Engagement

To ensure the SRV application process and IPART requirements are fully covered, a community engagement strategy will be implemented. The updated document, including the additional ISP Chapter 7, will be placed on public exhibition for 28 days. In addition, the document will be added to Council’s ‘Get Involved’ web site. During the exhibition period, three public meetings will be held to explain the implications of the proposed SRV. All submissions received will be reported to Council at the end of the public exhibition process for formal adoption and consideration before a final decision and formal notification to IPART.

Financial Implications

All costs involved in the SRV process, including the engagement strategy, will be covered using operational budgets.

Risk Implications

Further delaying the SRV application process may jeopardise Council’s ability to adequately engage with the community and meet IPART deadlines.

Addendum Agenda - Ordinary Meeting – Tuesday 24 October 2017

Page 11

CL17.296 Draft End of Year Financial Statements

HPERM Ref: D17/347661

Group: Finance Corporate & Community Services Group

Attachments: 1. Draft End of Year Financial Statements (councillors information folder) ⇨

2. Commentary on Draft EOY Financial Statements (councillors information folder) ⇨

3. Position paper Recognition of Rural Fire Service assets (councillors information folder) ⇨

Purpose / Summary

Under Sections 413 and 418 of the Local Government Act 1993, Council is required to refer the draft financial statements to audit, sign statements on the preparation of the statements and set the date for the presentation of the audited financial statements to the public.

Recommendation

1. That the Mayor, Deputy Mayor, the General Manager and the Responsible Accounting Officer sign statements on the preparation of the Financial Statements for the year ended 30 June 2017 in accordance with Section 413(2)(c) of the Local Government Act 1993 and requirements under the Local Government Code of Accounting Practice and Financial Reporting Update No. 25.

2. The draft Financial Statements for the year ended 30 June 2017 be referred to Council’s external auditor, Audit Office of New South Wales, in accordance with Section 413 of the Local Government Act 1993

3. Council present its audited Financial Statements and Audit Report to the public at the Ordinary Meeting of Council to be held on Tuesday 28 November 2017 and, in accordance with section 418 of the Local Government Act 1993, public notice of this date be placed in local newspapers on Wednesday 8 November 2017.

Options

1. Adopt the recommendation

Implications: Council will proceed in submitting the Draft End of Year Financial Statements in line with the requirements of the Local Government Act.

2. Adopt part of the recommendation and make an alternative resolution

Implications: Council may not meet the required timeframes for the submission of the Draft End of year Financial Statements

Background

Council’s Financial Statements for the year ended 30 June 2017 have been prepared and are ready to be audited.

In accordance with Section 413 of the Local Government Act 1993, Council must refer these statements for audit. Prior to the completion of the audit, Council is required to give its opinion on the Financial Statements.

Section 413(2)(c) of the Local Government Act 1993 and the Local Government Code of Accounting Practice and Financial Reporting requires the Mayor, one other Councillor, the General Manager and Responsible Accounting Officer to certify the following:

1. The General Purpose Financial Statements have been prepared in accordance with:

• Local Government Act 1993 (as amended) and Regulations made thereunder

• The Australian Accounting Standards and professional pronouncements

• Local Government Code of Accounting Practice and Financial Reporting

And that to the best of Council’s knowledge and belief that the statements:

• Present fairly the Council’s operating result and financial position for the year; and

• Accord with Council’s accounting and other records.

2. The Special Purpose Financial Statements have been prepared in accordance with:

• NSW Government Policy Statement “Application of National Competition policy to Local Government”.

• Office of Local Government Guidelines “Pricing & Costing for Council Businesses: A Guide to Competitive Neutrality”.

• The Local Government Code of Accounting Practice and Financial Reporting.

• The NSW Office of Water “Best-Practice Management of Water Supply and Sewerage Guidelines”.

And that to the best of Council’s knowledge and belief, the reports:

• Present fairly the operating result and financial position for each of Council’s declared business activities for the year, and

• Accord with Council’s accounting and other records.

The General Purpose Financial Statements and Special Purpose Financial Statements have been prepared in accordance with the Local Government Code of Accounting Practice and Financial Reporting and applicable Accounting Standards (draft copies are included in Councillors’ Information Folder).

The General Purpose Financial Statements are prepared on a consolidated basis. The information presented reflects all of Council’s activities including the General Fund, Water Fund, Sewer Fund and any other entities controlled by Council. It should be noted that all internal transactions are eliminated, including expenses relating to Council rates, water usage charges, waste management charges, etc. levied on Council activities.

The Special Purpose Financial Statements relate to activities of Council that are classified as a business under the National Competition Guidelines. Classified activities are further classified as either a Category 1 or Category 2 business depending on whether the annual turnover is above or below $2 million.

In preparing the Special Purpose Financial Statements certain taxes and charges that Council is not normally liable to pay must be calculated. These include company income tax, land tax and payroll tax. These amounts are included in the Special Purpose Financial Statements but only as notional amounts. The Special Purpose Financial Statements also include calculations with regard to Water and Sewer Best Practice pricing guidelines and dividend payments. These statements must be audited and submitted to the NSW Office of Water prior to the payment of a dividend from Water or Sewer funds.

Community Engagement

When the audit is finalised, the audited Financial Statements and Audit Report are to be presented to the public at a meeting of Council in accordance with Section 418 of the Local Government Act 1993. It is proposed that the Financial Statements and Audit Report be presented to the public at the Ordinary Meeting of Council to be held on Tuesday 28 November 2017. Public notice of this meeting will be made on Wednesday 8 November 2017 with the Financial Statements and Audit Report being available for inspection at Council’s offices and website from Wednesday 8 November 2017 to Wednesday 29 November 2017.

The process that Council must follow in the preparation, audit and presentation of the Financial Statements is prescribed in detail by the Local Government Act 1993. The following timetable will allow these processes to be satisfied.

24 October 2017	Ordinary Meeting of Council – 2016/17 draft Financial Statements presented to Council seeking Council to resolve to refer them for audit and make statements on the preparation as required by Section 413 of the Local Government Act 1993 and the Local Governmnet Code of Accounting Practice and Financial Reporting
Prior to 31 October 2017	Auditors report received by Council and the Financial Statements and Audit Report submitted to the Office of Local Government
8 November 2017	Public advertisement notifying that the Financial Statements and Audit Report are available for inspection at Council offices and Libraries until 29 November 2017. The advertisement also advises that the Financial Statements and Audit Report will be presented to the public at a Council meeting on 28 November 2017
28 November 2017	Ordinary Meeting of Council – Financial Stataments and Audit Report presented to the public at a meeting of Council
6 December 2017	Closing date for public submissions on the Financial Statements. Any submissions received must be referred to Council’s auditor for consideration (Section 420)