Report by Exception, Status of Key Projects, Executive Management ...

Far North District Council CEO Performance Management Report as at June/July 2013Please note: Report by Exception, Status of Key Projects, Executive Management Key Performance Indicators, Keydeliverables on Priorities and Key Performance Indicators and Risk Management to June 2013 will not be availableuntil August 2013 as the Annual Report 2012/13 is in preparation and subject to Audit.Purpose of ReportThis CEO performance management report provides elected members with a monthly progress update. It includes:• FNDC at a Glance - significant progress/issues on operational items from each activity group;• CEO meetings/issues - key achievements/outcomes from meetings attended by David Edmunds and/or theGeneral Managers; and• Good News Stories - is to demonstrate key success factors for the organisation.1. FNDC at a Glance• Business Performance and ITItem nameAnnual Community FeedbackSurvey July 2013Asset Management ApplicationTelemetry System (monitoring ofwater and wastewater)Desktop replacement andupgrade of windows and MSofficeQV ValuationBusiness Case MethodologyEnvironmental ManagementTeamInfrastructure and AssetManagement TeamProgress/issuesAround 400 Far North householders will be chosen at random and asked to givetheir views on a wide range of district council services and issues in a telephonesurvey during July 2013.The council has commissioned independent market research company VersusResearch Ltd to carry out the survey in order to get an unbiased appraisal of theway in which it conducts its business.IT analyst assigned to work with Infrastructure and Asset Management teamregarding the configuration and design for the management of district facilitiesassets.Initial work has identified a significant risk to Council with the current ageingsoftware application and hardware currently in use at Transfield and in the field.The initial priority is to bring the infrastructure back under FNDC management,followed by a review the software solution, reporting systems, and fieldsolutions.The project will include the upgrade of field technology for gathering of data inthe field into the RAMMS asset management system. Key decisions this monthinclude an assessment of the number of staff requiring dual access to the FNDCnetwork and the number of staff to have a citrix unit, or PC/laptop. The aim tohave one device only.QV Valuation contract currently under review with the legal team. Two optionsare being proposed - a six (6) year or (nine) 9 year contract. The aim of thereview between the two options is to ensure best value and service provision toCouncilBusiness case internal policy, reference guide and templates are being finalisedready for presentation by GMT to their respective teams. To be used for allcapital and operational projects commencing July 2013. This approach todevelopment of business cases to justify expenditure, should produce additionalrigour for any decision as well as providing a baseline against which return onexpenditure can be subsequently evaluated against original benefits identified.Review of PIMS function. Also review the three current CCC (code ofcompliance certificate) processes with view to combine and streamline into oneprocess.Review of MOS for planning, environmental and building departments along witha review of the new legislative requirements versus the level of work completedby the department for Finance and Audit presentation.RAMMS system, hardware and processes report completed and draftrecommendations made to improve processes, responsibilities andaccountabilities, and fit for purpose hardware.

Far North District Council CEO Performance Management Report as at June/July 2013FNDC Printing ContractFNDC Risk ProfileSpatial Strategy/Provision of GISServicesInfrastructure as a ServiceNewly contracted AOG provider to commence scoping and rightsizing for FNDCdemands due in July.Updated policy and framework ready for review and sign off by Council.‘Interplan’ product to be utilised for monitoring and reporting FNDC risk profile.Catalogue of FNDC data sets being compiled in preparation for upgrade of GISsystems. FNDC has five GIS systems and utilises the same software as WDC,NRC, DOC and the Rural Fire Service. Contractor currently completing thiswork, whilst FNDC identifies what if any activity should be outsourced.Eagle Technologies report re FNDC readiness to move to an outsourcedenvironment presented to GMT. Recommendations and roadmap reinfrastructure and software applications to be presented to GMT 19.07.13.• Business Performance and IT continuedItem nameOrganisational goals and KPI’s(Plan on a page) 13/14 yearProgress/issuesFinalised first draft set of organisational goals and KPI’s for CEO. Once finalisedwith CEO and Council, the organisational goals and KPI’s will be distributed toGMT and rolled out to staff for inclusion in the 13/14 goal setting exercise.• Corporate ServicesItem nameAnnual Plan 2013/14Carry forward budgetsAudit management reportAnnual reportChristmas Closure reportProgress/issuesFinal responses to submitters continue to be processed and will be completed(on time) by the end of JulyThis report has been finalised and is included on in the July meeting agenda.Mangers have reviewed the audit management report and made comments tobe included in the report which will be presented to the August Audit andFinance Committee for approval.Establishment of reports and commencement of year end closedown processesis well underway. Audit New Zealand is due to commence their audit in lateSeptember.GMT has requested further information to be included in the report which will berepresented to GMT for inclusion in the August Council meeting.• Community and Customer ServicesItem nameCustomer ServiceLibrariesProgress/issuesEnd of year processes satisfactorily completed.Initial investigations into relocation of service centre tasks from the John ButlerCentre office and having a Duty Planner and Building Officer available atProcter.Variety of activities in all Public Libraries.Paihia - A display of Margaret Mahy's picture books and a Hairy Maclareydisplay celebrating his 30th anniversary which includes bunting, posters,balloons and activity sheets for the kids to take away. The Rotary History Roomwas on display as usual upstairs. There was a small art display of work byAmerican artist, Katherine Tensley featuring tourist towns in NZ. The Book Clubwas held with visiting author John Hatchard promoting his book, A Squaddy'sTail. A group of children from the Paihia School attended to the vegetablegarden.

Far North District Council CEO Performance Management Report as at June/July 2013Kaikohe - Two junior school classes came to visit the library to celebrate HairyMaclary's 30th Birthday with us.i-SITEsTe AhuExciting opportunity to have the Four Square located in the Hokianga i-SITEbuilding in Opononi being progressed. Lease has been signed Primarily thisexercise is about FNDC providing support to the local community in response tothe previous Four Square premises being burnt down.The Matariki Honour Concert held Thursday 4 July featuring Whirimako Black,Betty Anne Monga (Ardijah fame), Maisey Rika and Ria Hall was a hugesuccess – approx. 200 people attended. Thanks to the FNDC staff, Street Maytzand 2 Senior Students from Kaitaia College who volunteered their time. Theirefforts attributed towards the success of this Concert and a fantastic night out forthose who attended.There have been numerous days during July when all venues were booked -putting increased pressure on FNDC staff to ensure Hirers needs are being met,venues are ready and inspected after each hire. Staff continue to juggleenquiries and bookings so as to avoid turning potential customers away. Thereis also an increased need to utilise the mezzanine floor office as an alternativemeeting room mainly for staff, elected members and Trustees.• Environmental ManagementItem nameDistrict Plan changesPublic awareness of the DistrictPlanSale and Supply of Alcohol Act2012Increase dog owners awarenessof registration requirements andtheir responsibilitiesProgress/issuesPC 12 – Paihia heritage. Not all parties agreed to mediation meaning the matterwill proceed directly to the Environment Court hearing.PC 13 – Technical Amendments: An appeal has been lodged.PC 15 (Rural Provisions) and PC 16 (Impermeable Surfaces) - both planchanges have been notified for submissions. 13 submissions received to datefor PC 15, 6 submissions were received for PC 16.GMO plan change – Council passed a resolution to proceed (in principle) with aGMO plan change. This is dependant on other councils also committing to aplan change as well.Staff have taken a number of opportunities to promote awareness of the districtplan. The community feedback survey will be undertaken in July.The new Sale and Supply of Alcohol Act 2012 have provided legislatively forincremental changes to the liquor licensing processes undertaken by Councils.These are being implemented in stages as required and so far there have beenno issues.The major change is that by 18 December 2013, Councils are required to haveoperational DLC's (District Licensing Committees) in place to determine and signoff all applications. This is in hand with Senior Management.The second stage of the legislation changes came into effect on 18 June 2013,requiring the Agency to consider the new criteria for new licenses, and the newcriteria for public to object to an application. Discussion documents have beenreleased on the new fees regime for alcohol licensing systems.Council at its meeting in June resolved for staff to commence the process ofinviting nominees for community members of the licensing committee. Alsoresolved to allow Community Boards to consult with stakeholders over the issueof local alcohol policies.There has been an Increased dog owner’s awareness of registrationrequirements and associated responsibilitiesThe threat of seizure of unregistered dogs has encouraged owners to come inand register, which has contributed to 97% of known dogs to be registered. Thiscompares with 90% for the full year 2011-12, and is also 2% up on the annualKPI for 2012-13. An improved plan has been developed for registration year2013-14 to maintain and improve on the success of 2012-13 year.

Far North District Council CEO Performance Management Report as at June/July 2013NZ ForestryNorthern Drainage Area DraftOperation and Management PlanStaff recently took a strong position with respect to forestry operations onWaitahue Road north of Broadwood. Council were not prepared to fund thewidening of the road for one only logging operator who had decided to use theroad without consultation. The end result was that Council moved to close theroad to heavy transport. With $100-120,000m3 of wood cut and ready to behauled, the logging operator finally reached agreement in conjunction with theowner to pay for widening the road. Fulton Hogan are currently doing this work.In a similar vein but with a more positive approach demonstrating FNDC workingclosely with the sector, Hancocks and Northland Forest Managers approachedCouncil over the upcoming harvest of a large forest block off Materau Road nearthe Kaipara border. FNDC priced the upgrade of the road to handle theprojected 7400 truck and trailer movements (30 /day) to cost over $250,000 asthe gorge road required significant widening. Staff have agreed with the forestrycompanies that their contractors can do the work provided it meets ourstandards. The forestry companies involved will meet 66% of the associatedcosts.Also of note is that this road runs onto Piccadilly Road where there is a knowndust nuisance. The forest companies will pay for the application of gravel lock tocontrol the nuisance at an appropriate time (likely November)This is a good interim solution pending a more structured long term strategybeing developed.The two instances have highlighted above demonstrate the challenges facingthe district with the forest industry. The larger established players are consideredin their responses and understand the issue for Council and will work forpragmatic solutions. However the small farm lot forest owners are tending tohave an attitude of “catch-me-if-you-can” approach.Significant success has been achieved since this Enlarged Rural Fire Authoritywas established as a entity including Forestry owners, DOC and FNDC. Theentity is chaired by FNDC. Success to date includes Fire Claim costs reducingfrom over $1.6M in 2011/12 year to approx $300k for the 2012/13 year. This hasoccurred even though the numbers of fires have remained relatively constant.This approach has also seen a large reduction in hectares burnt which are notvalued in this assessment. Adding this factor would further improve the results.Improved fire suppression techniques have been at the core of some of thesegains. However improvements in safety standards and staff preparedness havealso seen significant gains.2. CEO Meetings/IssuesMeetingStaff Road ShowsPre-Election Candidate SeminarsNorthern Rural Fire AuthorityKey achievements / OutcomesHeld three staff road shows which gave management anopportunity to increase the staff’s understanding of what ishappening within Council, and the projects lookingforward.In conjunction with the staff road shows, the managementteam held three workshops which provided potentialcandidates with information on: Council structure, electionprocess, overview of the district, commitments, etc. Eachpresentation saw approximately 14 potential candidatesturning up (42 in total). Feedback showed thepresentations were well received and informative.Significant success has been achieved since thisEnlarged Rural Fire Authority was established as a entityincluding Forestry owners, DOC and FNDC. The entity ischaired by FNDC. Success to date includes Fire Claimcosts reducing from over $1.6M in 2011/12 year to approx$300k for the 2012/13 year. This has occurred eventhough the numbers of fires have remained relatively

Far North District Council CEO Performance Management Report as at June/July 2013constant. This approach has also seen a large reductionin hectares burnt which are not valued in this assessment.Adding this factor would further improve the results.Improved fire suppression techniques have been at thecore of some of these gains. However improvements insafety standards and staff preparedness have also seensignificant gains..3. Good News StoriesProjectKey achievements / Outcomes1. Development Contributions As a result of working with Borneo Developments inKerikeri, the DC’s collected in advance of thedevelopment have resulted in the income exceeding theannual target. This is an act of goodwill by the Developerand will help as a contribution towards replacement of theKerikeri Waster Water Treatment Plant.2. Human Resources Induction Programme IT Security Consultant who reviewed the security of ITsystems, procedures and policy reported that of all theorganisations that they consult with in Australia and NewZealand, FNDC have one of the best recruitment /induction processes.3. Carrington Consent Council has been involved in a long running disputeinvolving Carrington Estate & Ngati Kahu over Council’sdecision to allow a 12 unit residential development atKarikari. The Court of Appeal decision has overturned theHigh Court judgement and found in Council’s favour in allcounts. This decision accepts that Council’s process anddecision not to notify the application was correct.Unfortunately Ngati Kahu are seeking leave to take thematter to the Supreme Court.4. Interplan ‘Interplan’ Planning and Performance systemimplemented for the monitoring and reporting of Risk,KPI’s, projects and strategic priorities from the LTP andAnnual Plan. The system has the capacity to reportfinancial and non-financial information. Significant inputfrom the IT and Business Performance teams over thelast 3 months has given this positive result. Councilreporting from August onwards will be generated utilisingthis system, and will replace the current spread sheetsand word documents.5. Debtors LedgerThe Far North District Council has removed $6 millionfrom its debtors ledger, thanks to the efforts of the debtmanagement team formed two years ago. Money owed toCouncil for building and resource consent fees,development contributions and other sundry invoicestotalled $10.7 million in 2010 when a debt managementteam was established. That figure now stands at $2.7million as a result of management allocating more staff todebt management, data cleansing and improving debtrecovery procedures.6. New Rating System Roading After years of reviewing the way that our rates are set inthe Far North, Council has adopted a new rating systemwith respect to its roading activities. This system isdesigned to increase contributions from forestry, mining,quarrying and dairy to more fairly reflect the impact thatthese industries have on our roading network. Work will

Far North District Council CEO Performance Management Report as at June/July 2013continue with these industries to move to a user paysmodel utilising such technologies such as electronic roaduser charging systems (eRUC). This proposed model hasthe additional benefit of council roading charges matchingmore closely to harvesting or extraction cash flows.7. Rates Easy Pay A series of road shows to educate the public on suchissues as the Department of Internal Affairs assistancethrough the Rates Rebate Scheme and Far North DistrictCouncil’s “Rates Easy Pay” have been conducted withcommunity groups. Since establishing the DebtManagement team over the last two years the team hasconducted road shows or discussions with approximately20 community groups. There has been a steady increasein the number of rate rebate applications received.8. Significant ‘success stories’ Items identified bystaff at the recent staff road show9. The restructuring of the IAM department has beenfully completed10. Strengthening of the Asset team has taken placewith effects already being seen in the move from dayto day survival to advancing forward planning.11. The Roading Business Unit was established 12months ago and during the year had to establish afull administration operating system, a newaccounting system, a new field operations system,developed relationships with new contractorsoperating in areas that were different, completedifficult legacy projects, helped contractors tounderstand a new performance based contractsystem and developed a monthly auditing system tosupport the performance based focus, respond to thesubstantial increase in logging related roadmovements and the resulting damage. Develop theRAMM management system moving to a fullelectronic network comms systemAs part of the recent road show, staff and managementworked up a list of significant success stories over the last12 months. Whilst this list is not in any way exhaustive itdoes provide a backdrop to a successful 12 months andpossibly identifies a number of initiatives otherwise notwidely knownOne of the largest restructuring activities was finallycompleted during this year without a single personalgrievance and dispute being evident although therestructure affected everyone in the departmentSkill sets have been added that have built the depth ofexpertise in water, waste water, district facilities and soonto be added structures and roading. We have alreadydiscovered that asset valuations have been inaccurateand now staff are challenging the valuer’s to improve theirvaluation methods. The asset team is already movingfrom current year planning to forward planning and by theend of September will have developed a more accurateworks and renewals budget for the LTP in two years time.The RBU team have succeeded despite many challengesfacing them. The handover from GHD was per functionarywith much of the available information held electronicallydated and incomplete. The team has been handicappedby poorly performing data entry units that are now beingreplaced as they were not able to support the GISrequirements needed in the north due to the widegeography of the district. Despite these issues the teambought the budget in on target and completed all plannedworks having achieved a massive learning curve.Strengthening the team is a priority to ensure the gapsidentified by management and NZTA are addressed. Anew method of working with the forestry sector wasdeveloped during the year with a wider level of informationexchange and cost consequences explored and with thedeveloped forestry companies a shared expensesenvironment has been developed. Formative work hasbeen completed on the network with a GPR survey ofsome of the key forestry corridor roads with this indicatingin most cases they are not fit for purpose and will requirelong term development to support the industry. A userpays method has been identified using ERUC and iscurrently under development. Bridge and retainingstructures are regularly being replaced and upgraded at acost that typically runs at 60% or less that the GHDsolutions of former years.

Far North District Council CEO Performance Management Report as at June/July 201312. Street lighting development Staff conceived, developed and implemented a completerestructure of the long established street lightingprogramme introducing long life, energy efficient and ahigher standard of lighting in the district. The changeremoved the over headed costs being charged by TopEnergy, reduced their margins to 10%, reduced theircrews being charged to FNDC from 3 to 1 replaced all thelights at the ends of the network with long life LEDtechnology effectively commencing a cost saving forCouncil of more than $600,000 over 20 years. FNDC tookover the lighting registry from TE and with a diligentprogram of data cleansing removed 285 lights which wewere being charged for that either did not exist or wereowned by others.13. Kaeo Waste water Staff completed the installation of a new FNDC designedwaste water system leveraging the pond system duringthe year. The savings from the LTCCP budget was over$600,000 allowing for the possibility of a UV plant additionif required. The community collaborated with staff to planta wetland from locally sourced plant material. Currentlythe plant is running well.14. Hihi Waste Water The LTCCP envisaged a $2.8 million upgrade to thecurrent plant. Staff have spent $400,000 on a newfiltration and UV system that enabled the plant to complywith the RC. Further works may be undertaken this yearto replace the ageing flocculation tower but by finding andeliminating much of the storm water infiltration staff havesaved the issuing of an abatement notice and closescrutiny by NRC15. BOIWW Waste water Staff have deconstructed the original BOI scheme into twosmaller schemes one for Kerikeri and Paihia and haveapplied to NRC for a reduced standard of treatment. Incollaboration with TSL alternate treatment options havebeen designed and priced for upgrading the Paihiatreatment ponds as well as pricing treatment options forKerikeri. From this work the overall capital investmentsaving given acceptance by NRC of the RC change willbe in the order of $9 million16. Rawene Waste water Staff achieved agreement over the new RC for the wastewater discharge with a challenging local action group andin the process averted a demand for a significant upgradeto the existing plant. An open collaborative agreement hasbeen reached to complete an local effects analysis on theHokianga of the discharge.17. Water shortages in the South Hokianga Recognising drought conditions are being experiencedmore frequently in the area and current raw water sourcesare very small staff proposed a pan Hokianga accordwhere a backbone pipeline would be installed thatpermitted movement of water between three adjacentcatchments depending on the available supply in eachcatchment. The water pipeline would receive MOHfunding and be owned and maintained by FNDC. Recentmeetings with the iwi groups and agencies indicatedpositive support and further design work will beprogressed18. Cycleway progress Intensive work is currently underway with workprogressing on the three remaining sections of thecycleway. Very pleasing to see the growing engagementof iwi with the Utakura Incorporation actively working with

Far North District Council CEO Performance Management Report as at June/July 2013council to provide access across working forestry land toensure the cycleway can get through to largely Horeke offroad and to be planning accommodate activities up in theforestry block. The views for cyclists on this leg of the trailwill be outstanding. Ngati Hine is also revisiting theirposition to provide access through their forestry land tobypass the poor and largely uninteresting areas alongNgapippito Road. Work is progressing on building bridgesand clearing the track on many sections as part of anintensive effort to have the trail large complete before thecurrent tourist season.19. Civil Defence A recent review of Civil Defence preparedness during arecent workshop in Whangarei where the forward activityplan was discussed in detail drew comment from the NewZealand Controllers office that Northland had one of themost advanced organisational systems in the country andhad set the lead in the community engagement planning,Tsunami alert systems and welfare planning in thecountry. Maintaining the same commitment will largelycomplete the system required over the next three years.The strong support of the Councils to enable this and thededication of the volunteers was warmly acknowledged.20. Customer Services Department Libraries have increased the number of events overall,encouraging more and a wider variety of participation.Another e-Book portal is underway for Far North Libraries,extending the selection of e-Books that will be available toLibrary users.After its store burnt down in June, the Opononi 4 Squareis setting up shop in the Opononi i-SITE building.The number of overdue Requests for Service (RFS) havesteadily decreased over the year. Feedback receivedthrough the Draft Annual Plan process was thatcustomers felt their RFS’ were being addressed moreappropriately and in a more timely manner.The number of events being booked at Te Ahu hassteadily increased. Staff are volunteering at events andactively encouraging other locals to become part of avolunteer group for Te Ahu.21. SWAPS Council uses SWAPS to manage interest rates on ourpublic debt. With interest rates at historically low ratesCouncil has entered into a number of these SWAPS.Allowing for underlying margins, these SWAPS are fixingin rates of around 4.6% to 5.2%. Also pleasing is feedback from our Treasury Advisor who deals with a largenumber of Councils, stating that FNDC was one of thebest placed Councils in the country in terms of SWAPcoverage.22. Unitary Submission Our Council was the first Council in NZ to submit anapplication for a Unitary Authority under the newlegislation. Compliance for an application saw acomprehensive document delivered to the LocalGovernment Commission late last year. FNDC hascontinued to provide the Commission supplementaryinformation to further support the application. One notablepiece of additional information was the survey conductedacross Northland that showed an 86% preference for twounitary authorities for Northland; if the existing model wasto change.

Far North District Council CEO Performance Management Report as at June/July 201323. Financial surpluses as compared to otherCouncilsPrompted by feedback from the Local GovernmentCommission an analysis of two key indicators, debt andnet surplus was undertaken. FNDC is the only Council inNorthland to achieve consistent reductions in debt, fallingeach year since the peak of $112m in 2010 to $89m thisyear. FNDC was the only Council in Northland to have netsurpluses (after adjustments for non-cash revenue aremade) since 2007. Despite what is being said, theseindicators show FNDC to be out performing its Northlandpeers.24. Local Government League Table Larry Mitchell is an independent analysis who producesan Annual League Table, which is based on his analysisof all Councils in the country. This League Table is oftenquoted by Central Government when discussing Councilperformance. It was pleasing to see that FNDC is ranked37 th compared to Whangarei District Council, ranked 62 ndand Kaipara District Council ranked 67 th (NorthlandRegional Council not ranked).25. LTP 2013/14 Key Performance Indicators (KPI’s)26. LTP 2013/14 action/projects27. Pensioner HousingPresently we have 73 KPI’s from the LTP 2012/22. 50KPI’s have achieved the target with 5 KPI’s slightly or offtrack.The remaining 18 KPI relate to Council’s facilitiesand services which require community feedback. This ispresently been carried out by an independent marketresearch company Versus Research Ltd. The final reportfrom versus due to Council 12 August 2013.Presently we have 120 actions/projects supporting theLTP 2012/22 priorities. 114 action/projects are on targetwith the remaining 6 Action/Projects slightly or off-track.Significant progress has been made to associatemaintenance. All pensioner houses are water tight,insulated and have their maintenance up to date.Concrete blocks have been resealed, spouting repaired orrenewed and new ovens and carpets as necessary.28. Continuous Improvement Internally FNDC measures performance against plannedoperational and capital works on a daily, weekly andmonthly basis across departments using a ManagementOperating System (MOS). The MOS, which is nowestablished in all departments allows for detailed analysisof staff output measured against availability and capacityto deliver on operational and project objectives. Thisis also a key tool used by managers and generalmanagers for resource planning both in the short and longterm.The beginnings of a culture of continuous improvementcan be demonstrated by the fact that more than 90% ofstaff have submitted a Continuous Improvement Request(CIR) for consideration over the last financial year. Theoverall number of CIRs received far exceed the number ofstaff at FNDC with some of the Staff submitting multipleCIRs. The submitted CIRs represent significantefficiencies in how FNDC uses internal and externalsystems, processes and procedures to achieveorganisational goals and objectives.