Part 3: Our observations on how the housing accord was prepared

Queenstown Lakes District Council: Managing a conflict of interest in a proposed special housing area.

3.1
In this Part, we give our views on whether the chief executive influenced the Council’s housing accord and lead policy. We discuss:

How the chief executive reacted to the Ministry of Business, Innovation and Employment approach

3.2
In Part 2, we said that the chief executive asked Local Government New Zealand why Queenstown (particularly the Wakatipu Basin) was not considered to have housing affordability issues at the same time that the Ministry approached the Council about the possibility of Queenstown being added to Schedule 1 of the Act. This timing was coincidental.

3.3
The chief executive said at that time that: “I think we need to stay part of this.” In contrast, the General Manager, Planning and Development’s initial reaction was to decline to be involved. The chief executive checked that the Mayor had an open mind about a housing accord and made positive remarks about it.

3.4
These exchanges show us that the chief executive was generally aware and interested in the Act from early on and thought that it might help address housing affordability issues in the Wakatipu Basin.

Who was involved when the process got under way?

3.5
Ministry officials were keen to progress a housing accord for Queenstown and drove the process strongly. Early on, Ministry officials told the Council that, usually, the Mayor, the chief executive, and senior technical staff would begin negotiating a housing accord before the full council becomes involved.

3.6
Those from the Council most involved in the process were:

  • the District Plan Manager;
  • the General Manager, Planning and Development;
  • the Mayor; and
  • Councillors Gilmour and Lawton (from August 2014).

3.7
At first, the District Plan Manager and the General Manager, Planning and Development looked after the process, with guidance from the Mayor as required, and information was mostly kept within this small group. After a Council workshop on 7 August 2014, Councillors Gilmour and Lawton became more involved. Most of the correspondence was between these people. The chief executive also received much of the written information that this group considered.

3.8
The decision to enter into a housing accord with the Government was a political decision for the elected members, with advice from Council officers with planning expertise. The Mayor had told councillors early on that an accord would be prepared if they agreed, and that they could contribute to the process (see paragraph 2.23). Ministry officials, the District Plan Manager, and the General Manager, Planning and Development did the detailed work on the draft housing accord as they prepared a draft accord for the Council to consider.

3.9
Council officers sometimes sought guidance on matters of substance, such as the housing accord targets, from the Mayor and other senior staff, rather than from the chief executive (see paragraphs 2.46 and 2.48). At other times, they sought guidance from both the Mayor and the chief executive. However, this tended to be on procedural matters or those involving the Minister for Building and Housing and the Ministry.

3.10
Early in the process, the Mayor decided that the Council should seek expressions of interest for special housing areas rather than target particular sites. We saw no indication that the chief executive was involved in that decision.

3.11
Councillor Gilmour was the main driver behind the Council adopting the lead policy to help put the housing accord into effect. The lead policy included the approach of seeking public engagement and expressions of interest, and the criteria used to evaluate the expressions of interest. Again, there is no sign that the chief executive was involved in that part of the process.

3.12
The meetings that the chief executive attended (with the Minister on 9 May 2014 and with Ministry officials on 21 May 2014) were near the start of the process and had a reasonably broad focus. At that time, the chief executive indicated that his interest in meeting with the Ministry officials was to discuss issues and time frames.

3.13
The chief executive supported the Mayor on procedural matters rather than matters that affected the content of the accord. These procedural matters included:

  • drafting the Council’s media statements on 9 May 2014 and 23 June 2014, and offering to deal with technical questions on the housing accord process;
  • reviewing the 6 August 2014 letter from the Mayor to the Minister on process and timing;
  • advising whether councillors should see the draft accord before the workshop on 7 August 2014 and whether the Council meeting to approve the accord on 28 August 2014 should exclude the public; and
  • attending the event where the Minister and the Mayor signed the housing accord on 23 October 2014.

3.14
These are normal matters that a chief executive would be involved in. They are not significant to the content of the housing accord or lead policy.

3.15
The General Manager, Planning and Development prepared the updates on the housing accord that were included as part of the chief executive’s monthly reports to the Council from September 2014. These updates were on matters of process rather than substance.

3.16
The chief executive received copies of the draft accord during the negotiations with the Ministry but does not appear to have made any comments. He also received briefing material from the planning staff about possible sites for special housing areas and their recommendation to focus on the Wakatipu Basin and their recommended targets.

3.17
The chief executive took part in a discussion with the Mayor and the planning staff on 22 July 2014 about these matters, and whether the Council could meet the Government’s timing for approving the accord. At that point, the planning staff had told the Ministry officials that they needed to discuss the timing problem with the Mayor and the chief executive.

3.18
The chief executive advised the planning staff how to approach the 7 August 2014 workshop with councillors but did not appear to comment on financial incentives for special housing areas, on which planning staff sought his views.

3.19
The chief executive was not closely involved in some of the more significant matters such as whether the accord should be in line with the proposed District Plan or whether the Council should adopt a lead policy for assessing expressions of interest. The chief executive did not attend the workshop on 7 August 2014, where officers sought councillors’ views on important matters such as the proposed focus on the Wakatipu Basin.

3.20
The Ministry officials we talked with confirmed that the chief executive was not closely involved in their dealings with the Council. The Mayor said that her main contact was with the General Manager, Planning and Development; the District Plan Manager; and the two councillors, rather than the chief executive.

The chief executive’s comment about Arrowtown

3.21
The chief executive suggested to the District Plan Manager that Arrowtown (also in the Wakatipu Basin), not just Queenstown, should be considered for special housing areas (see paragraph 2.26). This was at the time of the meeting with the Minister for Building and Housing on 9 May 2014. It was near the start of the process and before staff had recommended that the special housing areas focus on the Wakatipu Basin.

3.22
We asked the chief executive what he meant by telling his staff member that he was “slightly conflicted” when suggesting that Arrowtown should also be considered for special housing areas.

3.23
The chief executive told us that everyone in the Arrowtown area has views on whether there should be higher density housing there. He also said that people who had lived there a long time had different views than people who would like to move into the area. He described his remark to the District Plan Manager as a “throw-away line”. He said that, if he had intended to offer the land owned by his family for a special housing area then, he would not have made the comment. We discuss in Part 4 when the chief executive began thinking about development opportunities for the land owned by his family.

3.24
We asked the District Plan Manager whether the chief executive’s comment to him about Arrowtown affected his thinking or contributed to his recommended focus on the Wakatipu Basin. The District Plan Manager did not recall the chief executive’s comment. However, his reply to the chief executive shows that he was already well aware of housing issues in Arrowtown. The chief executive was not suggesting something new.

3.25
At first, Council officers looked to urban sites rather than greenfield sites as potential special housing areas. Ministry officials favoured district-wide targets, so the options from early on were either for the entire district or for the Wakatipu Basin. It appears that accord targets for Queenstown only were never considered.

The chief executive’s involvement in preparing the policy

3.26
The chief executive told us that he did not recall considering the housing accord in any detail when Council officers were preparing it with the Ministry. He also did not recall being involved in matters such as targets. This is consistent with the recollections of those who were closely involved, including the Mayor and a Ministry official (see paragraph 2.49). The chief executive told us that he did not get involved in detailed planning matters and left that to those with relevant expertise.

3.27
The chief executive considered the lead policy when he decided to put in an expression of interest, because it contained the evaluation criteria, but we have not seen any information suggesting that the chief executive was involved in preparing those criteria.

Main aspects of preparing the policy for special housing areas

3.28
The main aspects of the policy development process for special housing areas for the Queenstown Lakes District were:

  • the Government’s decision to add the Queenstown Lakes District to Schedule 1 of the Act;
  • the Council’s decisions:
    • to enter into a housing accord with the Government;
    • about suitable targets;
    • to focus on the Wakatipu Basin;
    • to have an open expression of interest process for proposed special housing areas; and
    • to adopt a lead policy to help put the housing accord into effect, with criteria to evaluate expressions of interest.

Our conclusions about how the policy for special housing areas was prepared

3.29
The chief executive was open to the idea of a housing accord for the district and played a part in the policy development process. However, our assessment is that his involvement had no significant effect on the main aspects of the policy for special housing areas.

3.30
The Council decided to enter into a housing accord with the Government. The elected members, led by the Mayor, with help from Councillors Gilmour and Lawton, made the decision. Council officers advised and supported the elected members in their decision-making and worked with Ministry officials. Understandably, the main advisors to the Council and in the negotiations with the Ministry were those with planning responsibilities and expertise. Those officers’ work led to the recommended focus on the Wakatipu Basin.

3.31
The Mayor suggested having an open process to seek expressions of interest. Councillor Gilmour was the driving force behind the need for a lead policy to help to put the accord into effect. The lead policy contained the criteria to evaluate the expressions of interest, and the chief executive was not involved in preparing the criteria.

3.32
The Council’s agreement to run an open process ensured that proposals for special housing areas in the Wakatipu Basin would need to be considered on their merits against the criteria in the lead policy.

3.33
The chief executive received information about, and had the opportunity to be involved in, these main aspects, but largely left them to others. There appears to have been no need for him to take a more active role.

3.34
Overall, we consider that the chief executive’s involvement did not have any significant influence on the Council’s policy development process for the housing accord or lead policy after the idea of a housing accord for the district was accepted.