Part 3: The new Council's approach to Franz Josef's wastewater problems

Inquiry into procurement of work by Westland District Council at Franz Josef.

3.1
The local government elections in October 2016 resulted in a largely new group of elected members.

3.2
The wastewater plant, and options for a new plant, had been hot topics in the election. The Council, after the October 2016 elections, was immediately faced with decisions about the wastewater plant.

3.3
The Environment Court order that was issued in November 2016, just after the elections, required the Council to decide on a replacement for the wastewater plant by the end of that year. There were decisions that needed to be made in the short term as decisions about the replacement plant were being made and implemented. How should the immediate non-compliance issues be addressed? And what, if anything, needed to be done to protect the current wastewater plant from the Waiho River?

3.4
Some significant staff changes also took place during the first half of 2017.

3.5
In this Part, we describe:

3.6
This information provides useful context for understanding later events and the Council's decision on 5 July 2017.

Westland District Council's choice of oxidation ponds instead of a mechanical plant

3.7
A Council meeting was held on 24 November 2016 where Council staff presented a report outlining various options for a replacement wastewater plant.

3.8
Based on the report that had been prepared for the Council by its consultants, Opus, Council staff recommended a new, high-rate, mechanical plant. The Council rejected this recommendation on the grounds that it was too expensive. The Council decided that lined oxidation ponds were the preferred option for a replacement wastewater plant.

3.9
Although the Council's decision to go with oxidation ponds went against expert advice, it was consistent with earlier community feedback, which generally supported oxidation ponds.

3.10
According to media reports of the meeting, the Council's discussion focused on oxidation pond options and touched on the need for better river protection at the current site. However, the Council did not decide on the location of the ponds or any river protection work. A few days after the Council's meeting, members of the Franz Josef community were told that Council staff were working on possible locations and would be consulting with the community.

3.11
There is evidence to suggest that, at this point, some elected members were already considering the option of expanding the wastewater plant at its current site and building a stopbank to protect it.

3.12
In the run-up to the local body elections, the current Mayor had advocated for adding another pond to the existing wastewater plant and building river protection. He had provided cost estimates for this work in a Facebook post, which included estimates supplied by potential contractors. Two of the named contractors had also been elected to the Council in October 2016 (Councillor Graeme Olson and Councillor Durham Havill).

3.13
A staff email dated 14 November 2016 records that "elected members have a view about building a stopbank around the ponds and then consider the site [to be] future safe". However, it was not clear from the email who the elected members were or how many of them were in favour of this option.

Discussions on short-term issues facing the current wastewater treatment plant

3.14
Elected members continued to discuss the wastewater plant and possible river protection work in the months that followed. However, it is unclear exactly what was discussed or agreed. The relevant minutes from meetings between December 2016 and April 2017 are often vague and without accompanying reports or papers.

3.15
Through a combination of the minutes and information we received from staff and elected members, we can surmise, in general terms, that during this period:

  • The Council was concerned that the current wastewater plant required remedial work and it wanted to keep some oversight of this work.
  • Councillor Havill, in his role as responsible for the Three Waters portfolio, often took a leading role in discussions at the Council table, including updating the Council on the ponds. Councillor Havill was also involved in getting quotes for work.
  • The Mayor and Councillor Havill visited the wastewater plant regularly and raised concerns about the flood risk directly with staff.
  • At its meeting on 15 December 2016, the Council discussed the need for river protection for the wastewater plant. The Council agreed that to consult with affected members of the community about "extending the rock wall" as a priority and the implications for their rates. It is not clear what extending the rock wall would involve, or what consultation, if any, took place with the community.

Plan to strengthen existing embankment and build new infiltration gallery

3.16
At a meeting on 22 June 2017, Council staff presented a report to the Council to advise it on planned work at the wastewater plant.

3.17
The report provided background information on the problems facing the wastewater plant, including the history of non-compliance with resource consents, the Environment Court order, the damage caused by the March 2016 flood, and problems with the infiltration gallery.

3.18
The report informed the Council about upcoming actions on the wastewater plant as follows:

The existing ponds will be maintained (this will include strengthening the existing damaged stop bank) and a new infiltration gallery will be developed.
This action will ensure compliance with the current resource consent and will leave Council with the ability to consider adding enhanced treatment methods to the wastewater at the ponds.
Future decisions on the pond locations and other treatment options can be made once final decisions are made on the future growth direction of Franz Josef.

3.19
The report did not seek approval or direction from the Council. The report was simply presented for information. This might have been because it was anticipated that the work would fall within the Chief Executive's financial delegation. If there was any discussion at the Council meeting about the nature of the work required, this was not recorded in the minutes.

The Mayor's statement about proposed work

3.20
The day before the 22 June 2017 Council meeting, the Mayor had said publicly that machinery would be working in the riverbed the following week, building a gravel wall to protect the ponds and access to them.

3.21
It is not clear what the basis for these statements was, as the report presented to the Council the next day did not describe the work the Council was proposing to carry out in this way. The focus of the report was on protecting the ponds and addressing compliance concerns in the short term, while decisions were being made about the future of Franz Josef and the location of the ponds in the long term. The report talked about strengthening the existing damaged stopbank, not building a gravel wall.

3.22
Correspondence between the Council's then Acting Chief Executive and a member of the Franz Josef community the day after the Council meeting also shows that Council staff were anticipating repairs to the existing flood embankment, not a new wall.

Staff changes during the first half of 2017

3.23
The first half of 2017 saw some significant, and sometimes turbulent, Council staff changes and resignations.

3.24
In February 2017, the Council's then Group Manager: District Assets, who was responsible for managing the Council's infrastructural assets (including wastewater), went on leave after the Serious Fraud Office started an investigation. His position remained vacant until late May 2017, when an Acting Group Manager was appointed. The Group Manager: District Assets resigned in June 2017.

3.25
In April 2017, the Council's Chief Executive resigned. An Acting Chief Executive was immediately appointed. He was an experienced Chief Executive and had previously been the Council's Chief Executive between 1998 and 2012. The Acting Chief Executive continued in the role until November 2017, when a new permanent Chief Executive started.

3.26
Other staff resignations about this time included the Council's Three Waters engineer.

3.27
The resignations of the Group Manager: District Assets and the Chief Executive are not directly relevant to our inquiry. However, we mention them because they were unsettling for staff and the Council. It might have also affected the continuity of advice to the Council on the wastewater plant.

Summary

3.28
In summary, by late June 2017:

  • The Council had rejected advice from external consultants and staff to replace the oxidation ponds with a mechanical plant. The Council decided to stick with the option of lined oxidation ponds. However, the Council had not yet decided whether these would be located at the same site as the current wastewater plant or elsewhere.
  • Some elected members, including the Mayor, supported the idea of expanding the wastewater plant at the current location and building a stopbank for flood protection.
  • The Council had discussed the need for protecting the current wastewater plant.
  • The Council was anticipating work to the existing flood embankment (that is, the raised access road) and infiltration gallery, while longer-term decisions were being made about the future of the wastewater plant. Council staff had described this work as strengthening or repairing the existing flood embankment.
  • There had been some significant staff resignations during the first half of 2017. However, by late June, an Acting Chief Executive had been in office for three months and an Acting Group Manager: District Assets had been appointed. However, the Council did not have a full complement of asset management staff.