2011-2012 Annual Report - Full Version - PDF - Palmerston North ...

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Group of Activities Operational Requirement and Funding SummarySupport Services GroupRevenueActual Budget Variance Actual2012 2012 2012 2011$000 $000 $000 $000Commercial or Strategic Investments 5,681 6,514 (833) 6,455Corporate Support 1,000 975 25 1,159Customer Services - - - -Total Revenue 6,681 7,489 (808) 7,614ExpensesCommercial or Strategic Investments 4,773 4,948 175 4,770Corporate Support 763 742 (21) 860Customer Services - - - -Total Expenses 5,536 5,690 154 5,630Net Operating COST OF ACTIVITY GROUP 1,145 1,799 (654) 1,984Rating AllocationAdd back depreciation 3,162 4,408 (1,246) 3,624Renewal capital expenditure (3,387) (4,030) 643 (2,088)External revenue for renewal capital - - - -Borrowing effect of renewal 3 year averaging 587 587 - (364)Provision for debt reduction (664) (664) - (150)General rates allocation 1,869 (2,100) 3,969 823Funding surplus/(deficit) 2,712 - 2,712 3,829SupportServicesWhat the Council Does120Palmerston North City Council Annual Report 2011/12
Activity - Commercial or Strategic InvestmentsWhat the Council doesThe Council has a range of assets that it owns forcommercial or strategic reasons. These include theLong Term Investment Fund, the Palmerston NorthAirport and the Gordon Kear Forest.The Council also has 96 Public Housing Units atthree locations around the City (Achilles Court,Rakaia Place and Waiheke Court). These are part ofthe Council’s Investment Activity because rents arecharged at market rates.The Council provides some services to otherCouncils on a commercial basis. These include acall centre and building services.Why the Council does this and itscontribution to Council vision andmajor goalsThe Council owns these assets because theygenerate revenue which helps fund the services itprovides to residents. This reduces the amount itneeds in rates.The Council also acts as a “friendly landlord” for thePublic Housing Units by not requiring potentialtenants to have rental references, New Zealandcitizenship or a credit history in this country.This means that there is a social aspect to thishousing that helps new migrants and internationalstudents to get a footing in the housing market inPalmerston North.The Council manages these assets through theLiability Management and Investment Policy andthe Airport Statement of Intent. Hence thereare no external levels of service or performancemeasures.What happened in the yearCommercial or Strategic InvestmentsGordon Kear Forest - The fourth season ofclearfelling has been completed in the GordonKear Forest, which is jointly owned by PalmerstonNorth City and Manawatu District Councils.Clearfelling is scheduled to take nine years in totaland is carried out mainly in summer when groundconditions are dry.The intended harvest programme was cut backthis season due to lower log prices. Proceeds fromlog sales were used to cover harvest costs and torepay further outstanding forestry encouragementloans.Site works have been carried out in preparation forreplanting early in the 2012/13 year.Investment Fund - Consistent with the Council’sstrategy to progressively wind down theInvestment Fund in an orderly manner, $2.59million was distributed back to the Councilduring the year. This compared with the budgetassumption of $3.3 million. The Fund earned $0.89million during the year (compared with the budgetassumption of $1.3 million) and Fund valuesreduced by $0.6 million (budget assumption nil).Investment Property - The commercial propertyportfolio is mostly made up of the Council’sretail properties in George Street, Main Street,two restaurant spaces in The Square next to theCouncil Chamber and the ground floor spaces ofthe Regent Theatre. The main highlight for thisactivity is that all of these properties are beingleased at present apart from one space in MainStreet temporarily being used as a workshop forThe Council manages these assetsthrough the Liability Managementand Investment Policy and theAirport Statement of Intent. Hencethere are no external levels of serviceor performance measures.the Civic Administration re-roofing project. Therehave been a number of enquiries from prospectivetenants about taking up this Main Street spaceonce the re-roofing project is complete. Thesecommercial properties are mostly associatedwith Council properties and help to ensure thatthe spaces at street level are vibrant and active.The shops associated with the Regent Theatreare particularly important in this regard as theycontinue to reinforce a positive image of the retailsector in Broadway Avenue.The office space rental in the fourth and fifth floorof the Civic Administration Building remains largelyvacant. There are some long standing tenants onthe third and fourth floors however there has beenvery little interest in the remaining floor space. Inthe 2012/13 year the Council will continue to tryand lease the vacant spaces on the fourth and fifthfloors.Palmerston North City Council Annual Report 2011/12What the Council Does Commercial or Strategic InvestmentsSupportServices121
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Palmerston North City CouncilAnnual
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Contents1. OVERVIEWCouncil’s Visi
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OverviewPalmerston North City Counc
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Year in ReviewAgainst the backdrop
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Overview Year in ReviewLocal Govern
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The following table details how we
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Funding Source Proportions for Oper
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Asset Base1,3601,3401,3201,300$ Mil
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Borrowing Ratios20%Policy Maximum16
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Overview What's Happening in the Ci
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Overview What's Happening in the Ci
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Overview How Do We Operate?Election
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Role of Management and EmployeesOve
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ActualAmount Paid2011/12$Annual Pla
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Overview Funding Support to Externa
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What the Council DoesPalmerston Nor
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Tying these pillars together at the
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What the Council DoesLeadershipLead
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Activity - Councillor Leadership an
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Financial ResultsActivity Operation
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The District PlanThe Council has co
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What the Council DoesCommunitySuppo
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Activity - CemeteriesWhat the Counc
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How did we performLevels of Service
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Activity - Community DevelopmentWha
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The Youth Library, located within t
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The Papaioea Place project will pro
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EconomicDevelopmentEconomic Develop
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Activity - Economic DevelopmentWhat
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How did we performPerformance Measu
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LeisureGroup DescriptionThe Leisure
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Activity - Arts and CultureWhat the
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How did we performPerformance Measu
Page 75 and 76: Activity - City LibraryWhat the Cou
Page 77 and 78: How did we performPerformance Measu
Page 79 and 80: Significant Activity Capital Projec
Page 81 and 82: What happened in the yearSportsfiel
Page 83 and 84: How did we performLevels of Service
Page 85 and 86: Levels of ServicePerformance Measur
Page 87 and 88: Financial ResultsActivity Operation
Page 89 and 90: j. Programme not completed due to s
Page 91 and 92: Environmental Sustainability and He
Page 93 and 94: Activity - RegulatoryWhat the Counc
Page 95 and 96: District Licensing Agency staff hav
Page 99 and 100: Activity - Roading and ParkingWhat
Page 101 and 102: Major issues relating to Roading an
Page 107 and 108: Activity - Rubbish and RecyclingWha
Page 115 and 116: Activity - WastewaterWhat the Counc
Page 121 and 122: Several projects were put on hold t
Page 125: Support ServicesGroup DescriptionTh
Page 131 and 132: Activity - Corporate SupportWhat th
Page 137 and 138: Financial StatementsFinancial State
Page 139 and 140: Independent Auditor’s ReportTo th
Page 141 and 142: Statement of Compliance and Respons
Page 143 and 144: Statement of Financial PositionAS A
Page 145 and 146: Statement of Cash Flowsfor the year
Page 147 and 148: PNCC measures the cost of a busines
Page 149 and 150: PNCC’s investments in its subsidi
Page 151 and 152: Carpark leasesAcquired carpark leas
Page 153 and 154: Critical accounting estimates and a
Page 155 and 156: Comprehensive detail of both financ
Page 157 and 158: Note 3Rates RevenueCouncilActual Ac
Page 159 and 160: Note 6Other gains/(losses)CouncilGr
Page 161 and 162: Note 10Cash and cash equivalentsCou
Page 163 and 164: ◊As of 30 June 2012 and 2011, all
Page 165 and 166: Accounting policies require that lo
Page 167 and 168: Current Reversal of Current year Cu
Page 169 and 170: Current Reversal of Current year Cu
Page 171 and 172: ◊reality is that infrastructure l
Page 173 and 174: Note 17Forestry assets Council Grou
Page 175 and 176: Note 21Provisions Council GroupActu
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Note 23BorrowingsCouncilGroupActual
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Note 24Equity Council GroupActual A
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Note 26Capital commitments and oper
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Carbon Credits◊◊PNCC has an agr
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Transactions with Councillors and K
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SalaryWith the enactment of the Loc
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Note 33Fair value hierarchy disclos
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PNCC’s maximum credit exposure fo
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The table below analyses PNCC’s f
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2012 2011$000 $000 $000 $000 $000 $
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Council Controlled OrganisationsCou
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Council Controlled OrganisationsThe
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Globe Theatre Trust BoardObjectives
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Te Manawa Museums Trust BoardObject
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Palmerston North Airport LtdObjecti
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AppendicesAppendicesPalmerston Nort
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How to Find usPostal AddressPrivate
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www.pncc.govt.nz
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