Auckland liable for clean up of Parker's Cup base option
by Richard Gladwell, Sail-World.com/nz 23 Jan 2018 16:23 PST
24 January 2018
High view of the Wynyard Quarter and Wynyard Point developments, Voaduct Harbour with Auckland City in the background © Wynyard Quarter
Minister for Economic Development David Parker has spoken with Radio New Zealand's local government and America's Cup correspondent, Todd Niall, on the status of his preferred option for the America's Cup bases to be housed as much possible on Wynyard Point.
On Sunday he was reported as saying that one of the leaseholders, Melbourne based Stolthaven had sent him a letter agreeing "in-principle" to vacating their site ahead of its agreed lease termination. Todd Niall reported yesterday on RNZ that: "Stolthaven has told the government that in principle it is prepared to move early, but only if it's paid a $6.1m fee to break its lease."
Sail-World.com/nz reported on Monday that a 2016 Supreme Court Decision said the cost and responsibility of rectification of land occupied by one of the leaseholders Mobil NZ, and owned by the former Development Auckland Ltd (name changed to Panuku Development Auckland Ltd in May 2017) was the responsibility of the Auckland Council-owned body.
The Supreme Court stated that the cost estimate of the rectification was $50million for the Mobil NZ leased land. That entailed excavation to a depth of 3.5metres removal of all contaminated soil and replacing it with clean fill. The Contaminated material would need to be disposed of properly.
Minister Parker claimed that his action in getting the "in-principle" agreement didn't change where the responsibility for rectification costs lay. That is quite correct, as under the Mobil NZ decision the responsibility for costs and remediation is with Auckland Council. It is merely a matter of when the money gets spent not if.
In the Mobil NZ decision, the Supreme Court noted that there was an earlier decision in a case bought in 2002/3 and decided in 2004 that claims very similar to those of Development Auckland v Mobil NZ were dismissed in BP Oil New Zealand Ltd v Ports of Auckland Ltd. Sail-World understands that the third case with Shell Oil was settled out of Court. It is early days on where the Stolthaven deal fits with the others, and where remediation costs will lie.
The point being that already funds-strapped Auckland Council is up for some serious money in rectification of the Viaduct Point.
Under the plans for the America's Cup bases, Panuku Developments was careful to fit these within the existing footprints of the silos and tanks. It would seem from Minister Parker's discussions with Stolthaven that some removal of tanks/silos is at least contemplated.
Parker is also correct in that action by itself does not directly add cost to the America's Cup bases, it does bring forward substantial rectification costs which fall to the Auckland Council, adding to what is already an expensive exercise. It is also a project which Panuku could defer until it better fitted with cash-flows, rather than the being done under the time pressure of an America's Cup.
Reporting on the Radio New Zealand website, Todd Niall noted:
An earlier lengthy court case over nearby land vacated by Mobil left the council liable for a $50m clean-up bill.
When asked if the public might have to foot the bill regardless of when or why Stolthaven moved, Mr Parker said: "That's correct."
"But I'm not conceding that is the position," he added.
He had no update from a meeting which took place between government officials and Stolthaven to discuss the firm's offer to move out.
It was not clear yet that the plan was achievable, and that decision might not be made before the resource consent process opened on the council plan, he said.
Council officers have argued that timing is critical in the Cup Village project, which needs to be finished by late next year, and that there were too many risks in the government's option.
The Council and Government are yet to agree on how costs will be shared for the America's Cup activities whichever option is successful. The Government receive most of the revenue from the Event by way of taxes and additional spending. The Council picks up the cost of the infrastructure, some revenue from superyacht mooring fees, and long-term rates revenue from any part of the development that can be turned in commercial or private residential use.
On January 15, 2018, the Resource Consents were lodge by Panuku Developments for the Council approved Viaduct Basin option for eight sites, with three on the Wynyard Wharf location and five on a 75-metre extension to Halsey Street and Hobson Wharves.
Those Consents open for public submission on February 1 and close on February 27, 2018, before being referred directly to the Environment Court in a fast-tracked decision process. There is the option of an Appeal from that Decision, or it could be subject to Judicial Review in certain circumstances. Another option is for the Government to pass legislation to impose a solution.
The Council preferred option is expected to be heavily supported by the wider Auckland and New Zealand sailing fraternity in a shift of support away from previous positions which the sailing groups have been in favour of blocking further incursion into the Waitemata Harbour.
Click here for Todd Niall's report And for the earlier report on Radio New Zealand click here
For Mayor Phil Goff's take on the Minister's proposal and letter from Stolthaven click here