Public forum – Councillors on their QAC statement of intent vote

We Love Wakatipu Report, 30 April 2020

We Love Wakatipu was asked to find out from each councillor why they voted 9-2 to accept a pre-Covid statement of intent that both QAC and QLDC acknowledged contained redundant financial forecasts a week ago today, despite almost 80 public forum submissions calling on them not to.

So, we offered all councillors the opportunity to say their piece on the same basis as council’s own public forum – two-day deadline, 400 words maximum. Three councillors chose not to participate: Heath Copland and Glyn Lewers, who both voted to agree to the SOI, and Val Miller, who abstained because she could not remember what the resolution was. The responses of all others are copied verbatim below, in the order received. Our original email is at the end.

The mayor copied his response, less than three hours after our initial invitation, to all councillors. To ensure this did not discourage councillors from responding, we reminded them this was an opportunity to explain their voting rationale in their own words, without time constraints of the meeting. And, that most people would not have time to go through two hours of video.

Councillor responses

In order of receipt:

Jim Boult

Hello Cath

Thanks for the contact. It is up to individual councillors whether they wish to respond or not. However, personally I do not consider that there is any need to have councillors record in writing their reasons for voting. The meeting, while held in a digital space was streamed so any person who chose to attend (digitally) was able to follow the questions, answers and debate. In that sense it was not unlike a normal meeting. The minutes will record the key points of the meeting and the vote.

As I say, if councillors individually want to share their thoughts with you than that is their choice but Council will not be producing a written rationale for votes on this item, or any other item on that agenda

Regards

 Jim Boult ONZM Mayor            

Penny Clark

Morning Cath…hope all still well in your bubble…….
I think I was pretty clear in my comments that I wanted us to concentrate on Triaging the business, looking after the staff, parking the SOI for the immediate moment

And once we have a better idea of border controls or Covid in general they produce a fit for Purpose document for Oct which will get us into the third quarter.

Hope this helps thanks Penny

Craig Ferguson (Ferg)

Hi Cath
Hope all is good with you and John.

I see you will have on the recording what I said at the meeting. As I mentioned, I wanted a complete accurate document that we could take to the community later in the year and get done. The future has come crashing into the present and who knows the outcome of it all…

Best Regards
Ferg

John MacDonald

Thanks Cath

All I wish to say is that, in the election campaign last year, I said I would not support the expansion of Queenstown Air Noise Boundary. I followed on from that at the council meeting on the 25th February, successfully moving to get into the letter of expectation that The QAC would “Continue to operate within the existing established noise Boundry.” Then at this last council meeting I moved to tighten up the Draft SOIs so the QAC would not commit to undertaking any spending on capital projects, I also stated, my belief that the QACs and our current position is so fluid and drastic that the QAC will need the extra time to come up with any kind of meaningful SOIso that is why I supported the recommendation which will now see a new and fit for purpose SOI due at our October meeting.

Regards
John

Quentin Smith

Thanks Cath, 

My decision was based on an acknowledgement of the incredibly dramatic circumstances we find ourselves in, an acknowledgment that the risks associated with undue airport expansion in Queenstown and Wanaka are effectively negated for the time being and that it was reasonable to understand, inform and respond to the new circumstances in a comprehensive way before October.  I reiterate the point i made in the Council meeting that the requirement in this SOI for the masterplans for both airports to be fully consulted and subject to endorsement by Council is a significant and major step in regaining control of our future for both airports and communities.  I will continue to be fighting for a better strategic vision for the future of our airports and one that doesn’t come at the expense of the community and the environment.

Niamh Shaw

Hi Cath,

A full account of the motion I moved at the 23 Apr council meeting is posted on my Niamh Shaw – QLDC Councillor Facebook Page, which details the many reasons I voted as I did. Since it is slightly more than 400 words, following is a condensed version:

One of the justifications for approving the draft SOI is that we’ve all got bigger things to worry about. I concur with that assessment; and therefore it made no sense to unnecessarily propose approving a meaningless document and cause additional stress to our residents. 

The previous SOI fulfilled statutory obligations until potentially (and legally) the end of Jul, so Council had no legal requirement or obligation to agree this document on 23 Apr.

Although Covid-19 was put forward as the reason we couldn’t (in this instance) direct our CCTO, every time we are presented with an opportunity to demonstrate leadership and governance over our CCTO we have dropped the ball. That’s not a symptom of Covid-19. Until we, the Council, start actually governing our CCTO, we are doing great disservice to our council staff, the QAC board and staff, and our community.

 With its Covid-19 ‘disclaimer’, the SOI is a self-declared ‘invalid’ document that achieves precisely nothing in the way of governance or oversight, and is furthermore contradictory. Therefore it presents an untenable risk on a number of levels. One potential risk to our majority shareholding has been highlighted by Auckland and Wellington Airports’ recent requirement for shareholder support.

Requesting that our CCTO produce a condensed SOI outlining its recovery plan, and intent for servicing debt, is not a wall-mounted moonbeam; it is a basic requirement. All we achieve by delaying the process is further undermining trust in this Council and kicking the SOI down the road.

At the time, I considered approving the draft SOI to be a dereliction of duty.

I still do.

I would like to extend my sincere gratitude to all who submitted for public forum. The feedback was invaluable in enabling me to represent what I consider the wishes and best interests of our community

Cheers
Niamh

Calum MacLeod

Put simply under the LGA QAC must;

Achieve the objectives of its shareholders, both commercial and non-commercial by exhibiting a sense of social and environmental responsibility by having regard to the interests of the community in which it operates.”

QAC as our CCTO must be held accountable. This is why I voted NOT to accept QAC’s SOI twice last year. Due to the current exceptional circumstances I voted to recieve the SOI. Paragraph 16 of the report sums it up;

“Public interest in this process will be better and more meaningfully served through a modified SOI that reflects the true impact of COVID 19, and can incorporate the findings from both the Council’s Spatial Plan and Economic and Social Assessment currently being completed.”

I specifically ask QAC to note;

  • In addressing the immediate needs of the Airport community QAC cannot compromise the longer-term, higher-level goals and aspiriations.
  • This is the single best opportunity we will ever get to re-imagine our economic pillars and way we ‘do’ tourism in NZ with better outcomes.
  • Return to BAU is not an option!
  • The ‘High value tourist’ mantra will not cut it. The data proves pre Covid-19 we were getting less per tourist than 10 years prior.
  • This next SOI process must be community inclusive.
  • QAC needs to address destination management with the aim of understanding the prospect of a National outcome potentially limiting numbers coming into NZ.
  • QAC must rise to the Climate Change challenge – Board members have legal risk obligations.
  • Specifically how “QAC will identify and take opportunities to influence the aviation industry and airlines to reduce the carbon footprint associated with air travel.
  • I applaud QAC’s commitments to sustainability however QAC must move from Sustainable to Regenaritive.

At the last Council meeting Councillors adopted the Climate Action Plan. A challenge I laid to Council was;

Investigation & analysis of our tourism footprint including the direct impact of flights into the district & flight tax. Confronting this head on and early will truly show bold leadership.

As Bill McKibben says – “Rescuing high-polluting industries without imposing any climate conditions … would be an abrogation of our leaders’ responsibility for our future welfare.”

This District – as a key driver of NZ Inc. – has the capability to lead internationally.

I will be looking to QAC to provide the ‘Bold Leadership’ this District – its shareholders – are crying out for!

Niki Gladding

At Thursday’s council meeting (23 April 2020) I voted NOT to agree QAC’s Statement of Intent. That decision was based primarily on the risk the document might pose to Council’s majority shareholding – and ultimately our communities’ ability to control aviation and tourism growth. On the day, my decision came down to the document not managing the risk associated with QAC paying compensation to Remarkables Park Limited for ‘Lot 6’. What’s below explains my thinking in more detail…

Over 70 submitters to Public Forum made it clear that airport expansion is still something the community wants to be able to control, so that was front of mind. If I wasn’t sure our majority shareholding was as safe as it could be I wasn’t going to agree the document – and ultimately I wasn’t sure.

Currently, all business owners are scrutinising balance sheets and working to protect their investments. QLDC must do the same. QAC’s last financial statement was produced in December. At that time debt was close to $70 million and the company had 4 credit lines totalling $140 million; $50 million set to expire mid-2021 and $90 million in mid-2023 i.e. relatively soon. Financial costs were around $3 million per year. When I raised concerns about servicing debt, QAC didn’t contradict the figures or explain how it would achieve that. When I asked whether funding for Lot 6 was included in the capital programme (set out in the SOI) the CE couldn’t provide clarity.

The caveat added to the final motion is good and addresses some of my concerns. It means the SOI is not agreed unless QAC’s Board adds a paragraph to the SOI preventing further capital spending on projects set out in the document. However, the caveat doesn’t resolve the risks associated with Lot 6 and councillors don’t understand any options that QAC might have with respect to the acquisition. If the company pays compensation (potentially a huge sum) and then can’t service the resulting debt, it will be up to QLDC to either bail out the company or issue more shares – and QLDC may not be in a position to fund a bailout.

Finally, in the back of my mind was an understanding that there will be those who believe that the best thing for QAC – and possibly the tourism industry – is to rid the company of the legal requirements associated with being a CCTO.

NB – clarification from We Love Wakatipu

John MacDonald did get the letter of expectations changed, but the QAC statement of intent councillors agreed to does not reflect any long-term commitment to this. Instead it says:

“QAC has committed not to seek any expansion of the air noise boundaries at ……… at this time.”

That does not mean it isn’t planning to.

Because of Covid, the SOI says, QAC will not complete its master plans for either airport this financial year. Once it has, QAC will then seek council endorsement and consult fully with the community “before any decisions on future airport developments are made.” There is no suggestion this will not include air noise boundary expansion. (See page 10 of SOI.)

EMAIL SENT TO ALL COUNCILLORS 28 April, 2020.

Dear Councillors,

I hope you are all well and looking forward to extending life a little on level 3.

We Love Wakatipu Inc has been asked to approach councillors to ask you for your reasoning as to why you voted yes or no (or abstained) on agreeing to Queenstown Airport Corporation’s statement of intent last Thursday.

So we would like to offer you the opportunity to respond.

Like public forum, we ask for 400 words maximum, in your own words, by 1pm on Thursday.

  • The collation of responses will then be printed verbatim, in the order received, on our protectqueenstown.nz website with a link to our Facebook page.
  • For your information, we have already uploaded the video of the meeting and the collation of public forum submissions.
  • We have also uploaded a story from the Wellington City Council website about their vote to provide shareholder support to the capital’s airport the same day you voted on the SOI.

We very much look forward to hearing from you all.

Kind regards,
Cath Gilmour
We Love Wakatipu Inc chair

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