Agenda of Northern Beaches Council Meeting

Item 9.1 Northern Beaches Council MEETING - 25 June 2024

9.0 Corporate Services Division Reports

ITEM 9.1

Outcome of Public Exhibition - Draft Delivery Program 2024-2028, Operational Plan 2024/25, Long-term Financial Plan 2024-2034 and Asset Management Plans 2024-2034

Purpose

The purpose of this report is to provide Council with the outcome of the public exhibition of the draft Delivery Program 2024-28, Operational Plan 2024/25 (including the Budget and Fees and Charges), Long-Term Financial Plan 2024-2034 and Asset Management Plans 2024-2034 and seek adoption of the revised documents.

Executive Summary

· The draft documents were exhibited from 3 May to 4 June 2024 through a range of engagement activities with a total of 136 individuals and groups making submissions, raising some 128 issues.

· Amendments have been made in response to the submissions as well as new and updated information being available since the draft documents were placed on exhibition.

· The 2024/25 budget proposes expenditure of $524 million (including a capital works program of $99 million), that a further $2.1 million in loans will be repaid and that a new $10.45 million loan will be taken out to part-fund the construction of the new Warriewood Community Centre.

· This budget continues to support services our community values such as library and child care services while also delivering priority infrastructure including a new pedestrain and cyclist bridge in Queenscliff, boardwalk at Manly Dam and community centre at Warriewood.

· The Operating Deficit before Capital Grants and Contributions has reduced from the $5.8 million exhibited in the draft budget to a deficit of $5.1 million (which is consistent with the forecast in the Long-Term Financial Plan 2023-2033 adopted by Council in June 2023), primarily due a $0.7 million decrease in the forecast Emergency Services Levy.

· While the 2024/25 budget is balanced with funding identified for all planned expenditure, there is a growing gap in infrastructure renewal and maintenance requirements, with the Asset Management Plans requiring an additional investment of $15.1 million per year to maintain and renew existing assets, along with $10.4 million per year to uplift service levels and provide high priority new assets required by the community.

· Like many councils in NSW, Council is facing growing pressure to its financial sustainability as increases in income, under the NSW rate peg system, have not reflected the rising costs of materials, contracts, and construction, with Sydney’s inflation over the 3 years to 30 June 2023 being more than double the increase in rates income.

· The Long-Term Financial Plan shows income levels are no longer sufficient, a scenario which is not sustainable and without intervention will continue to reduce services to the community.

· The Long-Term Financial Plan includes an alternative scenario to strengthen the Council’s position in the future and further engagement would be undertaken with the community to develop this option should Council choose to explore it.

RECOMMENDATION

That Council:

1. Note the Community and Stakeholder Engagement Report at Attachment 1.

2. Note the changes to the documents following exhibition at Attachment 2.

3. Adopt the revised Delivery Program 2024-2028 and Operational Plan 2024/25 at Attachment 3.

4. Adopt the revised Fees and Charges 2024/25 and Pricing Methodology applying from 1 July 2024 at Attachment 4 as the fixed fees in accordance with Part 10 of Chapter 15 of the Local Government Act 1993 (the Act).

5. Adopt the revised Long-Term Financial Plan 2024-2034 at Attachment 5.

6. Adopt the revised Asset Management Plans 2024-2034 at Attachment 6.

7. Make the following rates and charges:

a. In accordance with sections 494 and 495 of the Act, Ordinary and Special Rates are made as shown in Table 4 in the report for this Item.

b. In accordance with section 496 of the Act, Domestic Waste Management Charges are made as shown in Table 5 in the report for this Item.

c. In accordance with section 496A of the Act, Stormwater Management Service Charges are made as shown in Table 6 in the report for this Item.

d. In accordance with section 67 of the Act, the fee for works on private land carried out by Council is set at the appropriate commercial rate (being cost of the works and standard on-costs, to provide full cost recovery plus a return to Council).

e. In accordance with section 611 of the Act, a charge on the person for the time being in possession, occupation or enjoyment of a rail, pipe, wire, pole, cable, tunnel or structure laid, erected, suspended, constructed or placed on, under or over a public place.

8. Adopt an interest rate of 10.5% on overdue rates and charges, in accordance with section 566(3) of the Act.

9. Authorise the Chief Executive Officer to negotiate and accept loan/s for a period of 10 years from the lending market, and that the Seal of the Council be affixed to all relevant documents, in order to part-finance construction of the Warriewood Valley Community Centre to the amount of $10,450,000.

10. Revoke the Pricing Policy.

11. Address its financial sustainability through the preparation of the next Community Strategic Plan and Resourcing Strategy.

12. Note that Attachment 7 is confidential in accordance with section 11(3) of the Act, as it relates to matters specified in section 10A(2) of the Act relating to commercial information of a confidential nature that would, if disclosed, prejudice the commercial position of the person who supplied it.

Background

At its meeting on 30 April 2024, Council considered the draft Delivery Program 2024-2028, Operational Plan 2024/25 (including the Fees and Charges 2024/25) and Long-Term Financial Plan 2024-2028 and Asset Management Plans and resolved:

That the drafts of the Delivery Program 2024-2028, Operational Plan 2024/25, Long-Term Financial Plan 2024-2034 and Asset Management Plans 2024-2034 be placed on public exhibition for a minimum of 28 days with the outcome reported to Council.

This report outlines the exhibition and the community response, and provides further detail and explanation including recommended changes.

Consultation

The exhibition was open for 33 days from Friday 3 May to Tuesday 4 June 2024. A dedicated page on Council’s YourSay community engagement platform hosted the exhibition.

The exhibition was promoted via:

· Five community pop up/information sessions, distributing 868 QR coded information cards.

· One Council media release.

· Six electronic direct mails (EDMs) with 82,788 subscribers (Community Engagement newsletter and Council e-News).

· 12 Facebook posts with 176,610 reach.

· One online community information session attended by two community members.

· Two resident association meetings (Manly Ward Executive, Pittwater Community Alliance) and one Youth Action Group meeting – 39 attendees.

· Over 3,606 visits to the online engagement page spending on average 1 min 7s on the site.

In addition, material was available online making it easier for the community to see what was happening in their local area via 12 local snapshots covering the Northern Beaches. Fact sheets were also provided on footpaths and road re-sheeting programs, environmental programs, recreation programs and your dollars at work.

Consideration of Submissions, Themes and Issues Raised

Submissions

A total of 137 individuals and groups made submissions, comprised of:

· 114 online submissions using YourSay Northern Beaches engagement platform.

· 23 emails/letters direct to Council.

This was a 30% increase in submissions from the prior year.

A breakdown of the 137 submissions as to how they relate to each document is outlined below (noting that some respondents provided comments on more than one document):

Document	Issues raised on each document	Count of issues
Delivery Program 2024-2028 & Operational Plan 2024/25	106	168
Fees and Charges 2024/25	11	56
Long-Term Financial Plan 2024-2034	7	23
Asset Management Plan 2024-2034	6	7

Themes

The Community and Stakeholder Engagement Report at Attachment 1 outlines the engagement, submissions, and responses from Council staff. A summary of the key themes and number of issues raised in each theme is outlined below:

Themes	Number of issues raised
Transport and civil	29
Parks and recreation	21
Finance	12
Environment and climate change	12
Fees and Charges	11
Community engagement	8
Long-Term Financial Plan	7
Asset Management Plans	6
Waste	5
Organisation structure and staffing	5
Capital works	2
Community, arts and culture	2
Library	2
Aquatic centres	2
Property	2
Strategic land use planning	2
Compliance	1
Enterprise Resource Project	1

Issues

In the 137 submissions made, the issues receiving the most attention (six or more submissions) are outlined below.

Issues	Number of submissions on each issue
Childcare (including Family Day Care and vacation care) Fee increase - oppose	45
Oppose 4.9% rate increase	31
Long-Term Financial Plan – oppose Scenario 2, the Alternative Model - 14% in 2025/26 (including special rate variation of 10.6%)	15
Organisational structure and staffing	13
Reduce expenditure to balance the budget	13
New footpaths	7
Road improvements	6

Amendments and Additions

Delivery Program 2024-2028 and Operational Plan 2024/25

A total of 106 issues were raised on the Delivery Program. The highest number of submissions, 31, were received opposing the proposed 4.9% rate increase. Suggested ways of balancing the budget included Council reducing its own expenditure by cutting projects, looking at the organisation structure and focusing on core business.

Requests for improved service and infrastructure were also received across multiple locations. The submissions were seeking additional/priority funding of specific projects in 2024/25 - footpaths, bike and shared paths, road improvements, playgrounds and rockpools. Some of the items are planning to be delivered over the next four years.

Comments were also received on the community engagement including the level of promotion, the size of the documents and engagement timeframe. A two day extension on the exhibition was provided following Councillor feedback and late submissions were also accepted up until Friday 14 June. These matters will be considered in planning next years’ engagement.

Attachment 2 outlines changes proposed to the Delivery Program 2024-2028 and Operational Plan 2024/25 to reflect revisions to the budget outlined in this report. The revised Delivery Program 2024-2028 and Operational Plan 2024/25 is at Attachment 3.

Fees and Charges 2024/25

Eleven issues were raised on the proposed Fees and Charges 2024/25. Three issues opposed the fee increases for long day care, family daycare fees and vacation care and resulted in the highest number of submissions at 45. The proposed fees are consistent with the direction in the Children Services Strategy that the service be cost neutral (the service is fully funded by users rather than general revenue). A fee comparison across other services both not for profit and privately operated was also completed to ensure our fees are relevant.

Five issues were raised opposing increases to community centre fees and two in relation to aquatic centres fees. These fees are benchmarked and the increase refects rising costs of managing these facilities. Similar submissions were also received in relation to fees for Church Point and Manly carparks.

One issue was raised on the boat tie up fee at Church Point. The increase in fee reflects a move to harmonising watercraft storage fees across the area.

Attachment 2 outlines changes proposed to the Fees and Charges 2024/25. The revised Fees and Charges 2024/25 is at Attachment 4.

Long-Term Financial Plan 2024-2034

Seven issues were received on the Long-Term Financial Plan (LTFP).

Three issues relate to Scenario 2, the Alternative Model. This model was included in the document to explore the revenue implications of addressing the renewal and maintenance funding gap identified in the Asset Management Plan through a special rate variation of 10.6% in 2025/26 on top of the IPART rate peg estimated at 3.4%.Fifteen submissions opposed the alternative model, one suggested staging the increase over a longer timeframe and one supported the model.

The other issues raised were about the size of the capital works program, budgeting and performance measures.

Attachment 2 outlines changes proposed to the Long-Term Financial Plan. The revised LTFP 2024-2034 is at Attachment 5.

Asset Management Plans 2024-2034

Six issues were raised with the Asset Management Plan. Two related to the stormwater asset management plan and knowledge and mapping of assets while the third suggested minor amendment to the plan to make it easier to navigate. The proposed amendment is supported.

Attachment 2 outlines changes proposed to the Asset Management Plans which also includes updates consistent with financial changes made to the Long-Term Financial Plan. The revised Asset Management Plans 2024-2034 is at Attachment 6.

Proposed changes to the Budget 2024/25

The 2024/25 Budget remains balanced, however the operating result has changed due to rollovers from the 2023/24 budget approved through the March Quarterly Budget Review, adjustments in response to the decrease in the Emergency Services Levy along with new information available since the draft documents were placed on exhibition.

The following table summarises the movement from the draft to the revised 2024/25 Budget.

Table 1: Movement in the draft 2024/25 budget - Income Statement and Capital Expenditure

	2024/25 Draft Budget April 2024 $'mil	2024/25 Revised Budget June 2024 $'mil	Change Incr / (Decr) $'mil



Income from continuing operations
Rates and annual charges	259.1	259.1	-
User charges and fees	101.9	101.9	-
Other revenues	20.7	20.7	-
Grants and contributions - operating purposes	21.7	22.5	0.8
Grants and contributions - capital purposes	31.8	32.3	0.6
Interest and investment revenue	8.4	8.4	-
Other income	6.8	6.8	-
Net gain from the disposal of assets	0.4	0.4	-
Total income from continuing operations	*450.7*	452.1	1.3

Expenses from continuing operations
Employee benefits and on-costs	171.0	171.0	-
Materials and services	177.1	177.9	0.8
Borrowing costs	2.4	2.4	-
Depreciation and amortisation	52.1	52.1	-
Other expenses	22.1	21.4	(0.7)
Total expenses from continuing operations	*424.7*	424.9	0.1

Operating result - Surplus / (Deficit)	*26.0*	27.2	1.2

Operating result - Surplus / (Deficit) before Capital Grants and Contributions	*(5.8)*	(5.1)	0.7

Capital expenditure	*100.8*	99.3	(1.6)

Operating Budget 2024/25 - changes

There has been a reduction in the operating deficit (excluding capital grants and contributions) from $5.8 million exhibited in the draft budget to $5.1 million, as outlined below in Table 2.

Table 2: Summary of proposed movement in operating budget result (excluding capital grants and contributions)

	Net	Income	Expenditure
	$’mil	$’mil	$’mil
Draft operating result before capital grants and contributions	(5.775)	418.961	(424.735)
Emergency services levy contribution¹	0.702	-	0.702
Minor amendment to rates income	0.018	0.018	-
Items re-phased from 2023/24 through the March 2024 Quarterly Budget Review:
- Active Transport Pipeline Corridor project	-	0.712	(0.712)
- Manly events - Manly Special Rates funding	(0.070)	-	(0.070)
- Natural disaster grant funded works	-	0.050	(0.050)

Changes to budget	0.650	0.781	(0.131)
Revised operating result before capital grants and contributions	(5.125)	419.741	(424.866)

1. NSW Emergency Services Levy Contribution: NSW Revenue have recently advised the Council’s Emergency Services Levy (ESL) for the 2024/25 financial year will be $8.9 million, which is $701,320 lower than forecast. This has assisted in offsetting the forecast operating deficit result. This represents a 4.3% reduction on the 2023/24 Emergency Services Levy, primarily due to a 25% reduction in the contribution required by State Emergency Services.

Capital Expenditure Budget 2024/25 - changes

The 2024/25 capital expenditure program has decreased from $100.8 million to $99.3 million due to budget rollovers approved in the March quarterly budget review ($6.1m), projects rephased across financial years to align with revised timelines $8.7m and new grants ($1.0m).

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Table 3 below identifies proposed changes to the capital works program.

Table 3. Proposed changes – Capital Works Program – Increases / (Decreases)

Projects rephased: due to rollovers from 2023/24 as approved by Council May 2024 – Increases / (Decreases):
Project		Budget 2024/25 $'m		Forecast 2025/26 $'m		Forecast 2026/27 $'m		Forecast 2027/28 $'m
CR05127	IT infrastructure and devices – replacements		0.200		-		-		-
CN01121	Coast walk - art trail		(0.020)		-		-		-
CN01011	New traffic facilities		-		1.000		-		-
CN01018	Scotland Island roads and drainage improvements		-		0.327		-		-
CN01020	Warriewood Valley – traffic and transport infrastructure		0.248		-		-		-
CN01059	Church Point - new infrastructure		0.937		-		-		-
CN01182	Traffic Facility Delivery - accelerated		0.100		-		-		-
CN01198	Safer schools infrastructure		0.007		-		-		-
CN01224	Dee Why Beach secure bike storage		0.065		-		-		-
CR05009	Bus stop renewal works		0.020		-		-		-
CR05013	Retaining wall renewal works		(0.200)		-		-		-
CR05070	Major plant renewal		0.743		-		-		-
CR05071	Light fleet renewal		1.064		-		-		-
CR05074	Tidal pools refurbishment		0.300		-		-		-
CR05081	Wharves works program		0.200		-		-		-
CN01055	Warriewood Valley - public space and recreation		0.035		-		-		-
CN01168	Clontarf masterplan implementation		0.040		-		-		-
CN01188	Avalon Place Plan implementation		-		0.165		-		-
CN01197	Manly Dam boardwalk		1.000		-		-		-
CN01199	Frenchs Forest precinct park upgrades		0.459		0.541		-		-
CN01207	Little Manly Beach Masterplan Implementation		0.054		-		-		-
CN01210	Manly Dam mountain bike trail upgrade		0.230		-		-		-
CR05005	Rockpool renewal program		0.100		-		-		-
CR05134	Commercial centre renewal		-		0.399		-		-
CN01007	Collaroy-Narrabeen coastal protection works		0.500		-		-		-
CR05155	South Collaroy foreshore renewal		1.000		-		-		-
CN01109	Terrey Hills Emergency Services Headquarters		(0.014)		-		-		-
CR05159	Terrey Hills Rural Fire Station		(0.150)		-		-		-
CN01068	Warriewood Valley Community Centre		(0.840)		-		-		-
CN01225	Warringah Recreation Centre, North Manly upgrades		-		0.800		-		-
TOTAL projects rephased through the March 2024 Quarterly Budget Review - Increases / (Decreases)			6.078		3.232		-		-

Rephasing to align with updated project timelines – Increases / (Decreases)
Project		Budget 2024/25 $'m	Forecast 2025/26 $'m	Forecast 2026/27 $'m	Forecast 2027/28 $'m
CN01018	Scotland Island roads and drainage improvements	(0.473)	0.473	-	-
CN01141	Church Point commuter wharf expansion	(0.260)	0.260	-	-
CN01244	Pedestrian and cyclist bridge Pittwater Road, Queenscliff	(1.000)	1.000	-	-
CN01188	Avalon Place Plan implementation	(0.600)	0.600	-	-
CN01212	Shared path from B-Line stop to Boondah Rd	(0.164)	0.164	-	-
CN01231	Seaforth bike park	(0.350)	0.350	-	-
CN01235	Catherine Park, Scotland Island	-	0.050	(0.050)	-
CN01238	Outdoor Gyms - Dee Why and Manly Beach	(0.230)	0.230	-	-
CR05134	Commercial centre renewal	(0.101)	0.101	-	-
CN01142	Manly Life Saving Club	(3.550)	(2.750)	6.300	-
CN01229	Freshwater Beach amenities	(0.750)	0.750	-	-
CR05085	Mona Vale Cemetery works program	(0.320)	0.320	-	-
CR05136	Surf Life Saving Club minor renewal works	(0.165)	0.165	-	-
CN01225	Warringah Recreation Centre, North Manly upgrades	(0.703)	0.703	-	-
TOTAL projects rephased - Increases / (Decreases)		(8.666)	2.416	6.250	-

New grants – Increases / (Decreases):
Project		Budget 2024/25 $'m	Forecast 2025/26 $'m	Forecast 2026/27 $'m	Forecast 2027/28 $'m
CN01206	Dee Why Beach (Michaela Howie) playground upgrade	0.250	-	-	-
CN01207	Little Manly Beach Masterplan Implementation	0.175	-	-	-
CN01219	Beverly Job Reserve, Narraweena youth space	0.070	-	-	-
CN01249	Aranda Reserve, Frenchs Forest playground upgrade	0.015	-	-	-
CN01250	Swaine Reserve, Balgowlah	0.050	-	-	-
CN01251	Bridle Trail	0.050	-	-	-
CN01253	Seaforth Oval Cricket Turf Wicket Installation	0.220	-	-	-
CN01252	Newport Oval sports amenities upgrade	0.150	-	-	-
CN01068	Warriewood Valley Community Centre	0.050	-	-	-
TOTAL new grants - Increases / (Decreases)		1.030	-	-	-

Capital expenditure summary		Budget 2024/25 $'m	Forecast 2025/26 $'m	Forecast 2026/27 $'m	Forecast 2027/28 $'m
	Draft budget	100.822	86.126	69.316	65.924
	Above changes - Increases / (Decreases)	(1.559)	5.649	6.250	-
	Revised budget	99.263	91.775	75.566	65.924

Overview of the Revised Budget 2024/25

Draft Budget 2024/25

The 2024/25 draft budget projects total expenditure of $524 million, including a capital works program of $99 million. The proposed $99 million capital works program includes $43 million in asset renewal to improve the overall condition of our assets and to reduce ongoing operational costs associated with asset repair and maintenance. A further $56 million will deliver high priority new assets to the community.

The budget forecasts an Operating Deficit before Capital Grants and Contributions of $5.1 million, which includes a $12.1 million investment in replacing Council’s core operating systems. A further $2.1 million in loans will be repaid and a new $10.45 million loan is proposed to part-fund the Warriewood Community Centre project.

Efficiency savings

Council continuously seeks efficiencies and new ways to contain costs along with service improvements. Council has undertaken a number of measures to assist in offsetting cost pressures in recent years including fee reviews, achieving efficiency gains and cost savings.

The 2024/25 budget includes changes in service delivery models, optimisation of fleet and rationalising IT infrastructure. This results in $0.4 million in reduced costs in the 2024/25 budget, building on over $2 million in the previous two financial years.

These savings have assisted in offsetting inflation-driven cost increases and funding the replacement of Council’s core operating systems.

Service delivery

Councils carry out their functions to support a strong, healthy and prosperous community, as outlined in the Local Government Act 1993 (Act) and informed by each councils’ Community Strategic Plan (CSP).

Several functions undertaken by Council are required under legislation, while other services respond to the community’s expectations around priorities and service levels and the infrastructure that will be required to deliver them.

A sample list of services that Council performs beyond a legislated level of service and their proposed general revenue funded budgets for the 2024/25 financial year is provided as confidential Attachment 7 to this report (the attachment is confidential as it provides detailed service costings which could disclose or be used to calculate contractor pricing information). Community feedback indicates these services have high value and will support the Council in achieving the outcomes of the CSP in the 2024/25 financial year.

Following the election this year, the newly elected Council is required to review the Community Strategic Plan and engage with the community on the main priorities and aspirations for the future and strategies for achieving these goals, including decisions regarding services and resources.

Financial position and performance

Council has made positive and sound financial management decisions over many years which enabled Council to deliver significant projects, support the community during the COVID-19 pandemic and several natural disasters and invest merger savings into improved services and infrastructure to meet the needs of our community and improve their quality of life.

However, with inflation outpacing growth in rates income by almost 10% in 3 years and no mechanism in the IPART rate peg to adjust for this, income levels are not sufficient to meet future operating costs and maintain infrastructure at the level required. The budget anticipates Council will not achieve key financial and asset performance benchmarks in 2024/25.

The 2024/25 budget forecasts an operating deficit of $5.1 million (excluding capital grants and contributions) which results in an Operating Performance Ratio of -1.30%. This does not meet the industry benchmark of 0%. However, if the $12.1 million investment in the replacement of Council’s core operating systems is excluded, the Operating Performance Ratio would be 1.58%, with an operating surplus of $7.0 million.

Liquidity meets the industry benchmark (greater than 1.50x) with an Unrestricted Current Ratio 2.30x, meaning for every $1.00 in current liabilities there is $2.30 in current assets. However, this ratio weakens over the 4 years of the Delivery Program, gradually decreasing to 1.95x by 2027/28.

Net cashflow will be a negative $25 million in 2024/25 and $22 million 2025/26, primarily due to the construction of Warriewood Community Centre and the replacement of Council’s core operating systems. Net cashflow will return to a positive position from 2027/28.

Asset management ratios are weakening. The Building and Infrastructure Renewals Ratio will not be met, meaning Council is unable to invest in the renewal of assets at the rate at which they are depreciating. Maintenance expenditure is also no longer sufficient.

Financial performance and position snapshot

	Result	Forecast	Budget	Projected	Projected	Projected
	2022/23	2023/24	2024/25	2025/26	2026/27	2027/28
	$ 'mil	$ 'mil	$ 'mil	$ 'mil	$ 'mil	$ 'mil
Operating budget
Income	425	435	452	452	452	460
Operating expenses	(374)	(403)	(425)	(437)	(440)	(446)
Operating result	52	32	27	15	13	13
Less grants and contributions for capital projects	(34)	(27)	(32)	(25)	(16)	(11)
Operating result - excl capital income	18	5	(5)	(10)	(3)	2

Capital expenditure
New works	(43)	(34)	(56)	(42)	(23)	(14)
Renewal works	(40)	(46)	(43)	(50)	(52)	(52)
Total capital expenditure	(83)	(80)	(99)	(92)	(76)	(66)

Loan repayments	(5)	(3)	(2)	(3)	(2)	(2)

Cash and investments
Externally restricted	52	53	46	35	34	37
Internally restricted	91	87	69	67	68	64
Unrestricted	15	38	38	28	26	28
Total cash and investments	158	178	153	131	127	129

Cashflows
Net cash from operating activities	111	102	65	68	72	68
Net cash from investing activities*	(80)	(77)	(97)	(89)	(73)	(63)
Net cash from financing activities	(6)	(4)	7	(2)	(3)	(3)
Net increase / (decrease) in cash	25	21	(25)	(22)	(3)	2
* Exclude purchase and sale of investments

Financial position
Assets	5,636	5,754	5,891	6,000	6,112	6,222
Liabilities	(187)	(172)	(168)	(168)	(169)	(163)
Net Assets	5,449	5,582	5,723	5,832	5,943	6,059

Sensitivity Scenario Analysis

The following table demonstrates the impact that an unexpected significant event could have on the financial performance and position of Council, if no adjustment was made to fund the event. Given the operating deficit forecast in 2024/25, a situation such as a $5 million storm event, inflation on contracts at 10% or a $10 million unfavourable income shock would result in a higher operating deficit. Key performance and liquidity ratios would be weaker, with the Operating Performance Ratio remaining below the industry benchmark.

The Long-Term Financial Plan (Attachment 5) also includes a Sensitivity Analysis to further test the impact of inherent economic risks.

Proposed new loan

A new loan is proposed in the 2024/25 financial year to part fund the construction of the Warriewood Community Centre:

Loan amount	Proposed term	Repayment funding source	Purpose of loan
$10,450,000	10 years	The funding currently utilised to repay existing loans is sufficient to fund the repayment schedule for this loan as several existing loans are coming to the end of their term	To assist with the construction of the Warriewood Community Centre

The following has been considered in recommending a new loan:

· The construction of Warriewood Community Centre is a significant infrastructure project which will benefit future generations

· Borrowing for this project ensures an appropriate and financially responsible level of working capital contingency funding for the replacement of Council’s core operating system over the next 3 years

· The total amount of loan borrowings is sustainable in terms of Council’s ability to meet future repayments and budgetary obligations.

Loans and refinancing endorsed by Council in June 2023

As part of the adoption of the 2023-2027 Delivery Program on 27 June 2023 Council approved the following internal allocation and refinancing:

“8. Authorise an internal cash allocation from the ‘Mona Vale Cemetery Reserve’ of $4,600,000 towards funding the Enterprise Resource Planning (ERP) Replacement Project. These funds are to be returned to the ‘Mona Vale Cemetery Reserve’ from general revenue inclusive of the interest the reserve would have otherwise earned on these funds by 30 June 2029.

A. $2,500,000 (Westpac Bank – Former Manly Loan 47)

B. $2,400,000 (Commonwealth Bank of Australia – Former Manly Loan 48)”.

These 2 items are scheduled to take place across the 2023/24 and 2024/25 financial years. As such, the 2024/25 budget includes the following:

2024/25

Purpose of loan

$2,400,000

Internal loan

ERP Project (core operating system) – internal loan from the Mona Vale Cemetery Internally Restricted Cash Reserve¹ to part fund the replacement of Council’s core operating systems.

$2,400,000

Refinance existing loan

Public domain capital improvements under the former Manly Council in the 2015/16 financial year.

¹ Funds received from operating Mona Vale Cemetery are held for future perpetual maintenance of the cemetery. The balance of the fund was $7.9 million on 30 June 2023. This is a responsible funding strategy as an additional external loan would incur higher costs to the ratepayer. The ongoing upkeep of the cemetery will not be impacted by this proposal as the funds are not required until 2039 – in 15 years’ time. Modelling presented in the June 2023 paper showed the funds will be repaid to this reserve well before the funds are required.

Loans process

In seeking external loans, an ‘Expression of Interest’ (EOI) process will be conducted whereby authorised financial institutions licensed by the Australian Prudential Regulatory Authority (APRA) to carry on banking business (Authorised Deposit Taking Institutions or NSW Treasury Corporation) will be invited to submit written quotations on the refinancing requirements.

As prescribed in the Local Government Borrowing Order “A Council shall not borrow from any source outside the Commonwealth of Australia nor in any currency other than Australian Currency”. A minimum of three (3) institutions will be invited to provide submissions.

Appropriate and acceptable documentation must be provided to Council by any prospective lender during the EOI process.

Written quotations will be required to include the:

1. Interest rate.

2. Term of the loan.

3. Proposed repayment intervals (quarterly or semi-annual).

4. The amount of the repayment instalments.

5. The calculation process for any loan break costs.

6. Any applicable fees.

NSW TCorp has responsibility for collating and reporting to NSW Treasury the aggregate borrowings of councils in its annual proposed borrowing return. Council is required to complete and return a Proposed Borrowing Return to TCorp annually regardless of whether it has any new borrowings. The Return must include total estimates of borrowings for the next three years. A council’s proposed borrowing amount must be contained in its Operational Plan.

Council’s Chief Executive Officer is also required to advise the Secretary, Local Government, of amounts borrowed within 7 days after a council borrows money under a loan contract are taken out in accordance with clause 230 of the Local Government (General) Regulation 2021.

Revenue Policy

Rating Structure 2024/25

The NSW Government, through IPART, caps the total general income that may be raised from levying rates on property. IPART has determined that general income from rates in 2024/25 may increase by a maximum of 4.9%. This is the basis of the draft 2024/25 budget.

The rating structure is based entirely upon property valuations (ad valorem) but with minimum rates applying where appropriate. Rates for 2024/25 will be assessed on land values as at 1 July 2022 and are forecast to raise $198 million before pensioner rebates and adjustments.

It is recommended that Council adopts the maximum rate increase of 4.9% approved by IPART and in accordance with sections 494 and 495 of the Act, makes the following Ordinary and Special Rates for 2024/25:

Table 4: Ordinary and Special Rates 2024/25

Type	Category/subcategory	Number	Ad valorem rate*	Minimum $	Income estimate $’000
Ordinary	Residential	96,354	0.104021	1,099.78	163,637
Ordinary	Business	6,538	0.354318	1,431.96	26,585
Ordinary	Business – Manly CBD	640	0.568534	1,431.96	4,389
Ordinary	Business - Warriewood Square	1	0.575683	-	138
Ordinary	Business – Warringah Mall	1	1.083318	-	975
Ordinary	Business – Strata storage unit facility	580	0.354318	684.41	397
Ordinary	Farmland	7	0.040196	1,058.83	17
	TOTAL ORDINARY	104,121			196,138

Special	Manly business centre improvement	640	0.195315	-	1,452
Special	Balgowlah business centre improvement	82	0.105206	-	100
	TOTAL SPECIAL	722			1,552

	TOTAL RATES				197,690

* Ad valorem rate – cents in the dollar, charged for every $1 of land value

Note: The information in the above table has been determined using currently available property and rating information and may be subject to change prior to 30 June 2024, dependent on such matters as the processing of supplementary rates adjustments and revisions to ratepayer land valuations that may be determined by the NSW Valuer General.

Further details on the special rates as well as properties covered by business sub-categories and special rates are shown in Attachment 3 (Delivery Program) to this report.

Domestic Waste Management Charges

The Domestic Waste Management (DWM) Service is provided to all residential properties. Council must make and levy an annual charge for the service and income must not exceed the reasonable cost of providing the services (sections 496 and 504). The standard domestic waste charge is proposed to be $586 in 2024/25 (a $31 increase), raising $57 million in revenue.

As illustrated in the below chart, the proposed $31 increase in the charge relates to inflation on disposal, processing and collection contracts ($31), investment in waste service projects including the replacement of Council’s core operating systems ($9) and an increase in waste disposal costs due to a higher EPA Levy ($3).

Domestic Waste Charge price change drivers – 2023/24 to 2024/25

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Table 5: Domestic Waste Management Services 2024/25

Description	Number	Charge	Income estimate $’000
Domestic waste management service (includes 80L red, 140L blue, 140L yellow and 2x240L green lid services and 2 booked clean ups per year and vegetation drop-off at Kimbriki for residents up to 300kgs max once per day)	97,678	$586.00	57,240
Availability charge	1,349	$117.00	158
Additional 80L red lid rubbish service	12,217	$326.00	3,983
First additional 140L blue lid recycling service	3,616	$36.00	130
Subsequent additional 140L blue lid recycling service	157	$122.00	19
First additional 140L yellow lid recycling service	3,616	$36.00	130
Subsequent additional 140L yellow lid recycling service	157	$122.00	19
Third or fourth green vegetation lid service	3,616	$36.00	130
Clean up excessive or incorrectly presented waste	-	$223.60 per hour + cost recovery on landfill disposal charges	-
Clean up contaminated or excessive booked bulky goods collection in excess of the permitted 3 cubic metres	-	$86.00 per excess cubic metre	-
Empty contaminated bin	-	$35.40 per bin	-
Total domestic waste charge income $’000			61,809
Cost of domestic waste service $’000			(60,310)
Allocation to reserve $’000			1,499

Stormwater Management Services Charges

The Stormwater Management Services Charge is levied to all eligible residential and business ratepayers to fund a program of stormwater improvement projects and is forecast to raise $2.2 million in 2024/25. The charge is consistent with the upper limit set by the Local Government (General) Regulation 2021, which remains unchanged since the inception of the charge in the 2006/07 financial year. No changes to the charge are proposed.

Table 6: Stormwater Management Services Charges 2024/25

Stormwater Management Service	Charge
Residential – single dwelling	$25.00
Residential - strata lots	$12.50
Business	$25.00 per 350 square metres (or part thereof) for land categorised as business (excluding strata lots)
Business strata lots, business company title	$5.00 or the relevant portion of the maximum annual charge that would apply to the strata scheme if it were a parcel of land subject to the land categorised as business

Rates and annual charges

The estimated change in rates and annual charges, which represent the rates notice, are illustrated in the following table:

Table 7. Minimum, median and average residential rates and annual charges 2024/25

	Minimum			Median			Average
Item	2024/25 Amount	Increase		2024/25 Amount	Increase		2024/25 Amount	Increase
Residential Rates	$1,100	$51	4.9%	$1,394	$65	4.9%	$1,700	$79	4.9%
Domestic Waste Charge	$586	$31	5.6%	$586	$31	5.6%	$586	$31	5.6%
Stormwater Charge	$12.50 (strata)	$0	0.0%	$25 (house)	$0	0.0%	$25 (house)	$0	0.0%
TOTAL RATES NOTICE - PER ANNUM	$1,698	$82	5.1%	$2,005	$96	5.0%	$2,311	$110	5.0%
Per quarter	$425	$21		$501	$24		$578	$28
Per day	$4.65	$0.23		$5.49	$0.26		$6.33	$0.30

The median rate is based on the median (midpoint) 2022 residential land value of $1.34 million. The average is residential rates income divided by residential properties – it is the equivalent of rates based on a land value of $1.63 million. The minimum rate applies to land values just under approx $1.06 million.

Interest Charges on Overdue Rates and Charges

The Minister for Local Government has determined the maximum rate of interest payable on overdue rates and charges is 10.5% per annum for the period 1 July 2024 to 30 June 2025 (inclusive).

The methodology used to calculate the interest rate is consistent with the Supreme Court methodology utilised to provide a nationally harmonised provision for the awarding of post-judgement interest (the Reserve Bank cash rate plus 6%), rounded to the nearest half per cent of the maximum interest rate for the previous year. The cash rate used for the purposes of the maximum interest rate for local government is based on the cash rate as at 6 December 2023.

In accordance with section 566(3) of the Act, it is recommended that Council adopts the maximum interest rate allowed and this be applied to all Northern Beaches properties.

Section 611 Charges

Is it proposed that an annual charge under section 611 of the Act be made and levied for the year commencing 1 July 2024 on the person for the time being in possession, occupation or enjoyment of a rail, pipe, wire, pole, cable, tunnel or structure laid, erected, suspended, constructed or placed on, under or over a public place.

Works on Private Land

Council may carry out work on private land, either on request or agreement with the owner of the land, or under relevant legislation. The amount or rate proposed to be charged is the appropriate commercial rate – the actual cost of the works and standard on costs to provide full cost recovery plus a return to Council.

Pricing Methodology and Fees and Charges 2024/25

The revised Fees and Charges schedule for the 2024/25 financial year is provided as Attachment 4 to this report and has been prepared in accordance with the principles of the Council’s Pricing Policy.

Council’s Pricing Policy has been incorporated into the 2024/25 Fees and Charges document and re-named ‘Pricing Methodology’. Incorporating the Pricing Methodology within the Fees and Charges book provides the community with a clearer understanding of the principles-based approach Council takes to the pricing of services within the document.

As part of the adoption of the Fees and Charges each year Council will also adopt the Pricing Methodology. It is recommended Council revoke the Pricing Policy as this has now been incorporated (unchanged) into the Pricing Methodology within the Fees and Charges document. This approach is in line with requirements of section 610B of the Act.

Overview of the Revised Asset Management Plans 2024-2034

The Asset Management Plans (AMPs) has been revised to reflect the changes to the budget due to the rephasing of capital expenditure projects.

The AMPs identify infrastructure challenges that will require an additional investment of $15.1 million per year to renew and maintain existing assets along with an additional $10.4 million per year to invest in service uplifts and new assets.

Category	10 yr gap ($m)*
Renewal Gap	$117
Maintenance Gap	$34
Uplift in Service Gap	$67
New Asset Gap	$37
Total unfunded Asset Management Plans	$255m

* 10 year gap is expressed in present values (as at 30 June 2023)

Scenario 1 in the draft Long-Term Financial Plan identifies that the current level of funding for asset management will lead to declining asset renewal and asset maintenance ratios, which are reported within the annual financial statements. This is principally due to the rising costs of maintaining and renewing assets compared with the available funding to complete this work. Scenario 2 in the draft Long-Term Financial Plan provides for increased revenue to begin to address these gaps (excluding aspirational projects and programs).

Overview of the Revised Long-Term Financial Plan 2024-2034

The Long-Term Financial Plan (LTFP) has been revised to reflect the changes to the budget. The LTFP provides two scenario models.

Scenario 1 ‘Delivery Program Model’

· This model is consistent with the draft Delivery Program 2024-2028.

· Under this scenario, income levels are not sufficient to fund operating expenses, invest in the ongoing renewal of infrastructure assets and provide the necessary working capital to manage unexpected events. Performance benchmarks are weakening or not met, especially regarding asset management and operating performance.

· This scenario is not sustainable and without the intervention explored in Scenario 2 will continue to reduce services to the community. The primary issues are:

1. Over the past 3 years inflation has increased by 16.8% – more than double the 7.2% increase in rates income over the same period – this is an accumulative gap of $18 million in lost rates income.

2. Council has undertaken a number of measures to assist in offsetting cost pressures in recent years including fee reviews (where possible), achieving efficiency gains and cost savings of $2.4 million in the development of this 2024/25 budget along with the previous 2 financial years. While opportunities are continuously sought, these measures alone are unable to fully offset the impact of recent high inflation levels.

3. Significant events in recent years which required reprioritisation of funds including the COVID-19 pandemic ($41 million cost) and 7 natural disasters ($14 million cost of which $7 million has been recovered to date from the Federal Government Disaster Recovery Fund).

4. The Emergency Services Levy increased by $3.1 million (50%) to $9.3 million per year from 2023/24, with only a marginal decrease to $8.9 million in 2024/25.

5. Infrastructure challenges outlined in the AMPs which will require an additional investment of $15.1 million per year to renew and maintain existing assets along with an additional $10.4 million per year to invest in service uplifts and new assets.

Scenario 2 ‘Alternative Model’

· This model addresses the maintenance and renewal funding gap for existing assets outlined in the AMPs, which is $15.1 million per annum as at 30 June 2023.

· In this model infrastructure expenditure is increased and working capital is strengthened to provide the capacity to respond to unexpected events. This produces a stronger operating result and asset management ratios.

· To provide funding for this model, rates income increases by $20 million in the 2025/26 financial year, which is 10.3% above the forecast rate peg.

· It is important to note this scenario does not provide additional funding for the $10.4 million per annum funding gap associated with new assets and service uplifts proposed in the AMPs. Nor does it cover aspirational projects and programs and natural risk reduction measures which could add a further $16.5 million per annum in costs.

The following graph illustrates the difference in the operating result (excluding capital grants and contributions) for the 2 scenarios. A stronger operating surplus enables greater investment in the renewal of infrastructure assets and rebuilding working capital to respond to unexpected events like natural disasters and new opportunities.

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The following table compares key performance measures for the 2 scenarios.

Performance measures – Long Term Financial Plan Scenarios Comparison

Adoption of Revised Documents

Revisions have been made to the Integrated Planning and Reporting (IP&R) documents placed on exhibition in accordance with the changes at Attachment 2. It is recommended that Council adopt the revised:

· Delivery Program 2024-2028 and Operational Plan 2024/25 at Attachment 3

· Fees and Charges 2024/25 at Attachment 4

· Long-Term Financial Plan 2024-2034 at Attachment 5

· Asset Management Plans at Attachment 6

Timing

In accordance with the Act, Council needs to adopt the Operational Plan 2024/25 and Fees and Charges 2024/25 by 30 June 2024. The Delivery Program 2024-2028 has been updated as a rolling 4-year plan, along with the updates to the Long-Term Financial Plan and Asset Management Plans as rolling 10-year plans.

These matters are addressed in sections 404(2), 405, 610F(2), 610B(1) and 406(1) of the Act.

Financial Considerations

2024/25 Budget and Delivery Program

The budget for 2024/25 projects total expenditure of $524 million, including a capital works program of $99 million. The includes investing $43 million in asset renewal expenditure to improve the overall condition of our assets and a further $56 million in delivering high priority new assets to the community.

The budget is based on the IPART approved 4.9% increase in general (rates) income.

There are several restrictions on funds within the operating result. When these are removed, the underlying operating result is forecast to be a deficit of $9.8 million. If the election and replacement of Council’s core operating systems is excluded, the result would be a surplus of $0.8 million.

	$'mil
Underlying result
Surplus / (deficit) excluding capital grants and contributions	(5.1)
Less:
Interest on restricted Council funds	(2.5)
Domestic Waste net depreciation	(0.2)
Stormwater Charge net opex	(2.0)
Special Rates	(0.1)
Kimbriki (less dividend)	(0.4)
Mona Vale Cemetery	0.1
Development contribution funded operating projects	0.7
Gain on the disposal of assets	(0.4)
Projects - rephased from 2023/24*	2.0
Underlying surplus / (deficit) excluding restricted funds	(7.9)
Exclude core operating systems replacement (unrestricted funding)	8.9
Exclude election	1.7
Underlying surplus / (deficit) excluding restricted funds, core operating system replacement and election	2.7

* The projects rephased from the 2023/24 financial year are the core operating systems replacement and digital parking permits

While the budget is balanced with funding identified for all planned expenditure, Council in not anticipated to meet the Office of Local Government’s financial and asset performance benchmarks due to the deficit operating result and depreciation outpacing expenditure on renewing assets.

Following significant events in recent years including storms and the COVID-19 pandemic, along with high inflation outpacing growth rates income, Council faces a challenge in maintaining sufficient funding in future years.

Long-Term Financial Plan 2024-2034

The Long-Term Financial Plan provides two 10-year financial models.

Scenario 1 is the ‘Delivery Program Model’ which maintains rate increases in line with the annual rate peg only. In this scenario the operating result in 2025/26 is a deficit of $10.2 million, primarily due to a reduction in investment revenue as interest rates normalise and cash balances drop following completion of major projects ($4.0 million) and implementation of new software ($13.2 million) in that year. Performance measures for liquidity and debt management remain within the industry benchmark, however asset management and operating performance ratios are weak or below industry benchmarks.

Scenario 2, the ‘Alternative Model’, explores an option to strengthen working capital and provide capacity to address the unfunded asset renewal and maintenance requirements of the Asset Management Plan. This scenario is based on an increase in income of $20 million in the 2025/26 financial year (year 2) and meets all financial and asset performance ratios from that year onwards.

Scenario 2 is illustrative only and would involve further engagement with the community to develop this scenario should Council wish to explore this option further.

Governance and Risk Considerations

The review and updating of the Delivery Program, Operational Plan, Long-Term Financial Plan and Asset Management Plans are integral to good governance at Council. These documents have been prepared in accordance with sections 403-405, 406, 610B and 610F of the Act and the Office of Local Government’s Integrated Planning and Reporting Guidelines for local government in NSW (2021) and Integrated Planning and Reporting Handbook for Local Government in NSW (2021).

Environmental Considerations

Protecting the environment and ensuring that we can live sustainably on the Northern Beaches are key community aspirations captured in the outcomes and goals of the Community Strategic Plan. The Delivery Program, Operational Plan and Budget feature programs and activities that protect the environment and support the community to live sustainably.

Social Considerations

The Delivery Program and Operational Plan includes initiatives aimed at continuing to build resilience within a connected, safe and diverse community.

Link to Strategy

This report relates to the Community Strategic Plan Outcome of:

· Good Governance - Goal 19: Our Council is transparent and trusted to make decisions that reflect the values of the community.

· Good Governance - Goal 20: Our Council is proactive, and efficiently and effectively responds to, and delivers on, the evolving needs of the community.

· Participation and Partnership - Goal 21: Our community is actively engaged in decision making processes.

· Participation and Partnership - Goal 22: Our Council builds and maintains strong partnerships and advocates effectively on behalf of the community.

The projects and programs in the Delivery Program 2024-2028 and Operational Plan 2024/25 proposed over the next 12 months will contribute to the advancement of all outcomes and goals in the Community Strategic Plan 2040.

Reporting team

Financial Planning & Systems

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2024/268823

Attachments

⇨1 Community and Stakeholder Engagement Report (Included In Attachments Booklet)

⇨2 Proposed changes to the documents since exhibition (Included In Attachments Booklet)

⇨3 Revised Delivery Program 2024-2028 and Operational Plan 2024/25 (Included In Attachments Booklet)

⇨4 Revised Fees and Charges including Pricing Methodology 2024/25 (Included In Attachments Booklet)

⇨5 Revised Long-Term Financial Plan 2024-2034 (Included In Attachments Booklet)

⇨6 Revised Asset Management Plans 2024-2034 (Included In Attachments Booklet)

7 Sample of general revenue funded services performed beyond a legislated level of service (Included In Attachments Booklet) (Confidential)

⇨8 Existing Pricing Policy (Included In Attachments Booklet)

Item 9.2 Northern Beaches Council MEETING - 25 June 2024

ITEM 9.2

Monthly Investment Report - April 2024

Purpose

The purpose of this report is to provide details of all money that Council has invested under section 625 of the Local Government Act 1993 (Act).

Executive Summary

· In accordance with section 212 of the Local Government (General) Regulation 2021 (Regulation), the Responsible Accounting Officer must provide Council with a written report on a monthly basis setting out details of all money that Council has invested under section 625 of the Act.

· The Responsible Accounting Officer has certified that the investments listed in the report have been made in accordance with the Act, the Regulation and Council’s Investment Policy.

· As at 30 April 2024, Council had total cash and investments of $197,263,664 comprising:

Trading Accounts	$2,580,430
Investments	$194,683,234

· The portfolio achieved a return of 0.422% for the month of April, which was 0.072% above the benchmark AusBond Bank Bill Index return of 0.35%.

· The weighted average interest rate of the portfolio at month end is 5.08% compared to 5.13% for the prior month.

· Total investment income for April was $853,228 compared to budgeted income for the month of $448,848. Year to date income is $8,785,224 compared to budget of $5,348,875 principally as a result of both a higher than anticipated level of investments and higher investment interest rates.

RECOMMENDATION

That Council note the Investment Report as at 30 April 2024, including the certification by the Responsible Accounting Officer.

Background

In accordance with section 212 of the Local Government (General) Regulation 2021 (Regulation), a report setting out the details of money invested must be presented to Council on a monthly basis.

The report must also include certification as to whether or not the investments have been made in accordance with the Local Government Act 1993, the Regulation and Council’s Investment Policy.

The details of the report (the key aspects of which are in the Executive Summary) are set out below, together with the Responsible Accounting Officer’s certification.

Certification – Responsible Accounting Officer

I hereby certify that the investments listed in this report have been made in accordance with section 625 of the Local Government Act 1993, section 212 of the Local Government (General) Regulation 2021 and existing Investment Policies.

Investment Balances

*Rating is based on a private rating advised by the issuer to Council’s Investment Advisors.

Portfolio Analysis

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Institutional Credit Framework – Compliance with Investment Policy Requirements

Clause 4.2.2 of Council’s Investment Policy requires that the exposure to an individual institution be restricted by their credit rating so that single entity exposure is limited, as detailed in the table below:

S&P Long Term Rating*	S&P Short Term Rating*	Maximum %	Portfolio Complies with Policy?
AAA (incl. government guaranteed deposits)	A-1+	50%	Yes
AA+
AA
AA-
A+	A-1	40%	Yes
A	A-1	40%	Yes
A-	A-2	30%	Yes
BBB+
BBB
BBB-	A-3	10%	Yes
Unrated**TCorp Funds	Unrated**	5%	Yes ($Nil)
Unrated***ADIs	Unrated***	$250,000	Yes ($Nil)

* Or Moody’s / Fitch equivalents

** Unrated Category is restricted to eligible managed funds such as the NSW Treasury Corporation Hour Glass Facilities

*** Unrated ADIs Category is restricted to those ADIs that are under the Australian government guarantee scheme and limited to maximum $250,000 per unrated ADI.

Overall Portfolio Credit Framework – Compliance with Investment Policy Requirements

Clause 4.2.1 of Council’s Investment Policy requires that the total percentage exposure within the market to any particular credit rating category be limited, as detailed in the table below:

S&P Long Term Rating*	S&P Short Term Rating*	Maximum %	Portfolio Complies with Policy?
AAA (incl. government guaranteed deposits)	A-1+	100%	Yes
AA+
AA
AA-
A+	A-1	100%	Yes
A
A-	A-2	80%	Yes
BBB+
BBB
BBB-	A-3	30%	Yes
Unrated**	Unrated**	5%	Yes ($Nil)

* Or Moody’s / Fitch equivalents

** Unrated Category is restricted to eligible managed funds such as the NSW Treasury Corporation Hour Glass Facilities and ADIs covered by the government guarantee scheme.

Term to Maturity Framework – Compliance with Investment Policy Requirements

Clause 4.2.4 of Council’s Investment Policy requires Council’s investment portfolio is to be invested within the following maturity constraints:

Overall Portfolio Term to Maturity Limits			Portfolio Complies with Policy?
Portfolio % <1 year	Min 40%	Max 100%	Yes
Portfolio % >1 year ≤3 year	Min 0%	Max 60%	Yes
Portfolio % >3 year ≤5 year	Min 0%	Max 30%	Yes

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Investment Performance vs Benchmark

a) Portfolio Return vs Benchmark

	Investment Portfolio Return *	Benchmark: AusBond Bank Bill Index
1 Month	0.422%	0.35%
3 Months	1.287%	1.07%
FYTD	3.880%	3.62%
12 Months	5.115%	4.24%

* Excludes trading account balances

Council’s Investment Advisors have stated this form of portfolio reporting conforms to global investment performance standards and that these standards say that periods below 12 months should not be annualised.

The above table shows a comparison of Council’s investment portfolio return to the benchmark. Council’s Investment Advisor, Laminar Capital, has created an accumulation index for the portfolio which increases each month by the portfolio internal rate of return to enable meaningful comparison to the benchmark AusBond Bank Bill index, which is an accumulation index.

The Bloomberg AusBond Bank Bill Index is engineered to measure the Australian money market by representing a passively managed short term money market portfolio. This index is comprised of 13 synthetic instruments defined by rates interpolated from the RBA 24-hour cash rate, 1M BBSW, and 3M BBSW.

The portfolio achieved a return of 0.422% for the month of April which was 0.072% above the benchmark AusBond Bank Bill Index return of 0.35%. For the past 12 months the portfolio achieved a return of 5.115% which was 0.875% above the benchmark AusBond Bank Bill Index return of 4.24%.

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b) Portfolio Interest Rate vs Benchmark

	Weighted Average Portfolio Interest Rate (%pa) *	Average RBA Cash Rate
1 Month	5.08%	4.35%
3 Months	5.11%	4.35%
6 Months	5.13%	4.35%
FYTD	5.03%	4.25%
12 Months	4.94%	4.20%

* Excludes trading account balances

The above table shows the weighted average interest rate of the portfolio as at month end. This is an average of all the interest rates that each term deposit is earning. It is the current earning rate of the portfolio, and this information is useful as it shows how the earning rate is changing each month in line with changes in market interest rates. Each time a term deposit matures during the month it is being reinvested at current interest rates. To facilitate meaningful comparison, the weighted average interest rate of the portfolio is compared to the average Reserve Bank of Australia Cash Rate for the same period.

The weighted average interest rate of the portfolio is 5.08% compared to prior month's rate of 5.13%. For the past 12 months the weighted average interest rate of the portfolio was 4.94% compared to the average Reserve Bank of Australia Cash Rate of 4.20%.

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Monthly Investment Income* vs Budget

	Apr 2024 $	Year to Date $
Investment Income	853,229	8,761,272
Adjustment for Fair Value	(1)	23,952
Total Investment Income	853,228	8,785,224

Budgeted Income	448,848	5,348,875

*Includes all cash and investment holdings

Statement of Compliance

Portfolio Performance vs Bank Bill Index over 12-month period.	✔	Council’s investment performance did exceed benchmark.
Monthly Income vs Budget	✔	Council’s income from investments did exceed monthly budget.
Investment Policy Compliance
Legislative Requirements	✔	Fully compliant
Portfolio Credit Rating Limit	✔	Fully compliant
Institutional Exposure Limits	✔	Fully compliant
Term to Maturity Limits	✔	Fully compliant

Restricted cash, cash equivalents and investments

The breakdown of restrictions is generally not available for the current month within the timeframe for the completion of the Monthly Investment Report. Accordingly, the total cash and investments and restrictions related thereto are presented for the previous month.

At the end of March 2024 total cash & investments were $202,989,895 and were made up of the following reserve allocations.

Allocation of Funds	Amount ($)	Percentage
Externally Restricted	62,339,442	30.71%
Internally Restricted	89,892,563	44.28%
Total Restricted	152,232,005	74.99%
Unrestricted	50,757,890	25.01%
Total	202,989,895	100.00%

ECONOMIC NOTES

(Source: Primarily extracted from information supplied by Laminar Capital Pty Ltd)

Economic data released in April again showed most major economies close to recession or experiencing slow growth. Inflation remained sticky and above the targets of most central banks. The difficulty reducing inflation towards target became more pronounced in the US and Australia promoting a reassessment that it might take longer before official interest rates can be cut and in Australia resurrecting the possibility that the cash rate might need to be lifted further to bring inflation down to target range. Government bond yields rose in the US and Australia in April to reflect that official interest rates cannot be reduced this year.

In the United States, while GDP growth was softer than expected in Q1 at 1.6% annualised, down from 3.4% in Q4 2023, annual CPI inflation at 3.5% y-o-y in March and up from 3.2% in February, was above expectations for a third consecutive month. Rising cost of shelter and service prices continue to underpin inflation above the Federal Reserve’s 2% target. The US labour market also remains too tight to provide hope of inflation pressure subsiding in the near term. In March, nonfarm payrolls rose strongly by 303,000, the annual growth in average hourly earnings was above 4% at 4.1% y-o-y and the unemployment rate stayed low at 3.8%.

Despite the soft Q1 GDP growth reading, retail sales were strong in both February, +0.9% m-o-m, and March, +0.7%, signalling that US households continue to spend freely, buoyed by rising income and wealth. During April, the Federal Reserve seemed to tweak its guidance on the rate outlook from possible rate cuts starting mid-2024 towards no rate cuts before end-2024 at earliest. If US inflation continues to drift higher there is a small risk that the Federal Reserve may need to consider hiking the 5.50% funds rate. In a sign that the US bond market has all but lost hope of rate cuts over the next year or so, the 2-year US bond yield has risen 40bps over the past month and is sitting just below 5% yield.

In China, Q1 GDP was stronger than expected, up 5.3% y-o-y from 5.2% in Q4 2023. The strength in the Q1 GDP reading appears illusory, however, given mostly softer than expected March month economic reports consistent with growth below 5%. March fixed asset investment spending rose 4.5% y-o-y, industrial production was up 4.5% y-o-y while retail sales rose only 3.1% y-o-y. Export growth weakened sharply in March, -7.5% y-o-y from +7.1% in February. Weak inflation (deflation) reports in March also speak of continuing excess capacity with the CPI -0.1% m-o-m, +0.1% y-o-y and producer prices -2.8% y-o-y. Essentially, China needs to find a way to bolster growth in household spending, a tall order given the destruction of wealth from falling residential property prices (-2.2% y-o-y in March) combined with income growth constrained by high unemployment (5.2% in March). The authorities are resisting the type of policy program that might bolster general household spending such as large-scale government spending to provide a better income safety net combined with much easier monetary conditions.

In Europe, economic reports released in April continue to show almost no growth in the euro-area. Q1 GDP will be released later this week and is expected to show growth around 0.2% q-o-q, +0.1% y-o-y, a touch firmer than in Q4 2023, 0.0% q-o-q, +0.1% y-o-y. Weak growth running near recession is allowing inflation to moderate more in Europe than elsewhere with headline CPI inflation down to 2.4% y-o-y in March with underlying inflation 2.9% y-o-y. Pushing inflation down the last few yards to the European Central Bank’s 2% target is proving hard although there are signs that one of the sticking points for inflation, the tight European labour market generating high wage claims, may be starting to turn softer. Europe’s unemployment rate at 6.5% in February is showing signs of starting to increase. The European Central Bank (ECB) at its April policy meeting indicated growing concern about soft growth and if inflation pushes down nearer to 2% target that may still allow the ECB to start cutting the 4.00% deposit rate in the second half of 2024.

In Australia, the last hope was dashed of any RBA rate cut later this year by evidence of a still tight labour market in March and inflation in March and Q1 running higher than would be consistent with the RBA’s February Monetary Policy Statement economic forecasts. The RBA in the approaching May Monetary Policy Statement is likely to revise higher forecasts of CPI inflation which were 3.2% y-o-y for December 2024 and 2.8% for December 2025. It is likely that the RBA’s CPI forecasts will be above the top of its 2-3% target range through the remainder of this year and through 2025.

Financial Considerations

Actual investment income for the period from 1 July 2023 to date was $8,785,224 compared to budgeted income of $5,348,875, a positive variance of $3,436,349 principally as a result of both a higher than anticipated level of investments and higher investment interest rates.

Governance and Risk Considerations

A revised Investment Policy was adopted by Council at its meeting on 26 July 2022. The Policy is reviewed annually by the Audit, Risk and Improvement Committee. It was reviewed by the Committee at its meeting in December 2023, and no changes to the Policy were proposed.

Council’s Investment Strategy was reviewed in August 2023 by Council’s Investment Advisors, Laminar Capital Pty Ltd, who confirmed that the current policy “remains consistent with the Ministerial Investment Order and guidelines issued by the Chief Executive (Local Government), Department of Premier and Cabinet” and that they “do not recommend any changes to the list of approved investments or credit limit frameworks”.

Environmental Considerations

Council’s investments are managed in accordance with Council’s Investment Policy. Council’s Investment Policy requires consideration of environmental responsibility when making investment decisions.

Social Considerations

Council’s investments are managed in accordance with Council’s Investment Policy. Council’s Investment Policy requires consideration of social responsibility when making investment decisions.

Link to Strategy

This report relates to the Community Strategic Plan Outcome and Goal:

· Good governance - Goal 19 Our Council is transparent and trusted to make decisions that reflect the values of the community.

Reporting team	Finance
TRIM file ref	2024/347926
Attachments	Nil

Item 12.1 Northern Beaches Council MEETING - 25 June 2024

12.0 Planning and Place Division Reports

ITEM 12.1

Outcome of Public Exhibition - My Place: Manly (Manly Place Plan)

Purpose

The purpose of this report is to inform Council of the outcome of the public exhibition of the Draft My Place: Manly and recommend that Council adopt the updated My Place: Manly.

Executive Summary

· The development of a place plan for the Manly strategic centre was identified as an action in Council’s Community Strategic Plan - Shape 2028 and the Northern Beaches Local Strategic Planning Statement - Towards 2040.

· The aim of the the place plan is to provide a framework for how the Manly centre will evolve to meet community needs and aspirations through proposed actions, place priorities and concept design ideas for The Corso, the CBD laneways, Pittwater Road and Sydney Road.

· The draft My Place: Manly builds on the Manly2015 Masterplan and is informed by recently completed Council-wide studies and strategies, plans and reports including the Manly Night-Time Economy Strategy (HillPDA,2022) which identifies a number of principles and strategies to support and enhance the night-time economy while balancing the competing needs of all stakeholders in Manly.

· The draft My Place: Manly was publicly exhibited from 9 October 2023 to 3 December 2023 and engagement activities included online surveys, pop-up information stalls and a webinar, resulting in 125 written submissions and 505 survey responses being received.

· Community feedback showed strong support for improved event and cultural offerings and outdoor dining; improving streetscapes, increased green spaces and tree canopy; a bike hub; as well as concerns regarding night-time economy impacts on residential amenity and reduced car accessibility and parking.

· Minor amendments have been made to the exhibited plan to improve readibility and clarity in response to legislative updates and feedback from the community and state agencies.

RECOMMENDATION

That Council:

1. Adopt My Place: Manly to replace the Manly2015 Masterplan.

2. Write to submitters thanking them for their contribution and advise of Council’s decision.

Background

‘My Place’ is Council’s place-based approach to planning, design and management of centres, first initiated in the development of My Place: Avalon. The ‘My Place’ approach, which has now been applied to Manly, focuses on people’s connection to their local area and encourages them to work with Council to capture community expectations and aspirations for the area.

My Place: Manly sits within a broader strategic planning framework (see Figure 1), is informed by numerous plans, strategies and studies, and builds on the Manly2015 Masterplan.

Figure 1. Northern Beaches strategic planning framework and related studies

The Project

The place plan was developed over an 18-month period in collaboration with Council, its consultants Ethos Urban and HillPDA, and the Manly Project Working Group (PWG). The PWG comprised of 15 members (representing Manly Business Chamber, Youth Advisory Group and local resident associations, businesses, and special interest groups) and the Manly Ward Councillors. Critical stakeholder meetings were also held throughout the project, involving Council’s Community Safety Committee, NSW Police and Transport for NSW amongst others.

Council commissioned HillPDA to prepare the Manly Night-time Economy Study, which provided a baseline in understanding the significance of Manly’s night-time economy. The outcomes of the study informed the development of the place plan and how Council can manage impacts and competing land uses in the Manly centre to create a diverse, safe and thriving night-time environment.

Specific objectives of the Manly place plan project are to:

· work with the community to create a vision and subsequent plan for Manly to align changes to ensure Manly is vibrant, safe, inclusive, and sustainable now and into the future

· deliver a Night-time Economy Strategy for Manly and principles to adopt across the Northern Beaches Local Government Area (LGA) into the future

· deliver (exhibit and adopt for implementation) a place plan that responds to the outcomes and recommendations of existing strategic documents, as well as the Manly Night-time Economy Study commissioned for this project.

Once adopted, My Place: Manly will replace the existing Manly2015 Masterplan and other policies for the study area.

My Place: Manly

The place plan identifies 6 principles to guide the realisation of the community’s vision for Manly:

“Manly is a thriving and welcoming coastal town centre, uniquely positioned between a world-class beach and harbour, with a vibrant local economy, attractive and functional public spaces and rich Aboriginal and European Heritage. A place of stunning natural beauty to live, work, play and holiday!”

Four key places critical to how the Manly centre works have been identified to be the focus of the place plan: The Corso, Sydney Road, Pittwater Road and the CBD laneways (Market Place, Rialto Lane, Henrietta Lane, Central Avenue and Short Street). The concept design ideas for the key places and actions identified in the plan clearly address the plan’s guiding principles, objectives and place priorities for the Manly strategic centre.

Proposed actions and concept design ideas in the plan include preparing a comprehensive Movement and Place Study to assess current and future transport requirements, public domain improvements to create flexible spaces for events and activations, public art installations, a trial of extended trading hours for specific businesses, and encouraging outdoor dining in suitable locations including The Corso.

Council decision for exhibition

At its meeting on 26 September 2023, Council resolved as follows:

“That:

1. Council exhibit the draft My Place: Manly place plan for a minimum of 6 weeks.

2. The outcomes of the public exhibition of the draft My Place: Manly place plan be reported back to Council.”

The Draft My Place: Manly was placed on public exhibition from 9 October 2023 to 3 December 2023. The issues raised in submissions, including surveys, and responses to the matters raised are detailed in the Community Engagement Report.

Post exhibition changes

Since the exhibition, legislative reforms were introduced by the NSW Government namely:

· The NSW Vibrancy reform package - The 24-Hour Economy Legislation Amendment (Vibrancy Reforms) Act 2023 and the 24-Hour Economy Commissioner Act 2023, commenced on 1 December 2023. These reforms, being implemented in stages, include changes to standard trading periods, future changes to the NSW 24-hour Economy Strategy 2024 to address the needs of night-time workers, and sensible sound management and regulations. The place plan has been updated to include an action under Principle 1 to “review ongoing NSW Vibrancy Reforms for relevance to Manly”.

· The NSW Government commenced a review of the short-term rental accommodation (STRA) framework in NSW. The review is considering how well the current framework is balancing benefits to the tourism industry with the potential costs for housing availability and affordability, and potential policy options to encourage property investors to make homes available for long-term rental accommodation. As this review is still in the development phase, a new action has been added to the Action Plan, “consider and if required, implement changes from the updated short-term rental accommodation framework that assist in balancing visitor accommodation and housing in Manly centre”.

· The NSW Government has placed on exhibition an Explanation of intended effect for proposed changes to create low and mid-rise housing. The reforms relate R2 Low Density and R3 Medium Density residential zoned land. For Manly, this has potential implications in the ‘zone of influence’, being the area north of Raglan Street and south of Wentworth Street zoned R3. If the reforms progress, the future Movement and Place study will need to include potential changes to dwelling numbers in its modelling.

Other amendments resulting from feedback from the community and state agencies, e.g. Transport for NSW, have been made to My Place: Manly (Attachment 1), including changes to:

· text to improve clarity and the readability of the content where required, e.g. formatting and punctuation

· the ‘Community engagement’ section to detail the public exhibition recently completed

· the Objectives, including:

- adding an objective under Principle 1 to “Make a positive impact on community health and well-being”

· the Actions under the Principles including:

- amending Action 8 under Principle 3 to include encourage walking and cycling to “decrease congestion and increase amenity and health benefits”

· the Place Priorities including:

- amending “explore new options for waste management to free up the backs of buildings to provide additional opportunities for activation for the local cafes” to “explore new options for waste management to free up the backs of buildings to provide additional activation or visual treatment options”

· the amending Concept Design Idea 12 for The Corso by:

- deleting the words “transition a section of the existing bicycle paths on the promenade along North and South Steyne to a shared zone” to read as “investigate safety measures on the promenade to minimise conflict between pedestrians and cyclists”

· the Action Plan including:

- adding a quick win action to “extend on Connected Through Creativity 2029 through a busker program to provide entertainment in designated areas of Manly centre”

- amending Action S17 to include “investigate opportunities to facilitate a diverse range of land uses including office space, cultural creative activities and tourism-oriented development” as part of the new LEP/DCP project

- amending Action S18 to read: “Investigate and undertake a trial of late-night trading for low impact land uses such as retail, health and wellness, food and drink premises (without liquor licence)”.

The following principles have also been added into the Action Plan:

· "Investigate heritage significance of the sandstone pylons at the beach end of The Corso with the view to reinstate/ restore these pylons” as a short-term action.

· “Continue to advocate to Transport for NSW to retain the iconic Freshwater Class Manly Ferry" as a short-term action.

· “Consider and if required, implement changes from the updated short-term rental accommodation framework that assist in balancing visitor accommodation and housing in Manly centre” and is a medium-term action.

If adopted, the action plan within My Place: Manly will commence being implemented with a series of “quick wins” and has a timeframe of up to 2 years. One such quick win earmarked for implementation involves outdoor dining areas for an approved food and drink premises in suitable locations including The Corso under Action Q3. Currently, the Manly Development Control Plan (the ‘Manly DCP’) refers to a plan that restricts outdoor dining areas to 2 locations in The Corso and it is necessary to amend the Manly DCP as soon as practicable.

Additionally, key studies have been identified to inform the future public domain improvements in the Manly centre and include an Audit of Existing Assets/ Infrastructure and a Comprehensive Movement and Place Study (Actions S1 and S3 respectively) as well as the finalisation of Manly to Seaforth Flood Risk Management Study and Plan earmarked for completion in FY 2025-26.

The delivery timeframe has been increased to 15 years, from 10 years, reflecting Council’s ability to deliver the actions within its current forward program of works and the ability to secure funding. Delivery of the actions in the plan will be subject to funding being received.

Consultation

The Draft My Place: Manly was initially placed on public exhibition from 9 October to 19 November 2023, and then extended to 3 December 2023 (8 weeks). This included the principles for a 24-hour Economy as it related to Manly centre.

This is in-line with the Northern Beaches Community Participation Plan and Community Engagement Strategy.

Engagement Activities During Public Exhibition

Promotion and notification

· The project and associated engagement activities were primarily promoted through our regular email newsletter (EDM) and social media channels.

· A promotional video was made to accompany digital promotion.

· Fifteen toblerone signs were placed throughout the study area with QR codes directing users to the project Your Say page.

· Notification letters were mailed to all landowners and business operators/residents.

· Hard copies of the draft place plan and Manly’s 24-hour Economy Strategy were available to view at Manly Library, Council’s Manly customer service and the Manly Visitor Information Centre.

Online

· Your Say project pages and surveys were created for both the draft My Place: Manly and Manly’s 24-hour Economy Strategy, and all related documents were available to view online.

· Feedback was received via survey participation and written submissions via email and mail.

· A webinar was held on 18 October 2023 (5:30-7pm) on the project page where members of the project team outlined the project and answered questions that were submitted through the online chat function by registered community members. Afterwards, the webinar recording and slides were available on the project Your Say page.

· A ‘Frequently Asked Questions’ page was included on the project Your Say page and was updated to include questions from the webinar event.

Face-to-face

· Four x 3-hour pop-up information stall sessions were held across the study area (Manly Wharf forecourt, along The Corso and in the Manly Markets). Project staff were available to chat to community members about the project and encourage them to provide feedback online via the survey or email.

Enquiries

· Project enquiries could be made through a dedicated phone line, via email or in-person at the pop-up information stalls.

Stakeholder discussions

· The project team met and consulted with the Manly Community Forum and the Manly Business Chamber, Council’s Community Safety Committee and Transport for NSW.

· The project team also met with NSW Police and Council’s Youth Advisory Group.

Feedback and key themes

Council received 123 written submissions and 505 completed surveys for the draft place plan and 149 for the Manly 24-hour Night-Time Economy. Key themes are:

· The most important guiding principle in the plan is ‘Natural beauty and resilience’.

· Strong support for encouraging outdoor dining and entertainment in The Corso, CBD laneways and Sydney Road.

· Strong support for proposed public domain improvements, improved streetscapes including trees and gardens, public art installations, more public street furniture and green spaces.

· Strong support for pedestrian-friendly infrastructure on Pittwater Road.

· Support for a 6-month trial of late-night trading hours with a preference for hospitality and retail uses.

· Support for a bike hub/workshop maintenance facility on Short Street.

· Concerns for loss of on-street parking in Manly centre, especially from residents.

· Concerns regarding anti-social behavior and residential amenity (noise) impacts associated with increased night-time activity.

· Concerns regarding pedestrian safety, in particular the use of e-bikes on The Corso.

Suggestions to the draft concept plans go to details that will need to be investigated further at the detailed design stage for each key place, ensuring the priorities of the key place are addressed; for example, innovative solutions to mitigating windy conditions which could result in enhancing the environment.

The Community Engagement Report (Attachment 2) includes survey results and Council responses to the verbatim written submissions. Persons who made a submisison will be thanked for their contribution and advised of Council’s decision.

Timing

Upon Council adoption of My Place: Manly, the Manly2015 Masterplan will be repealed.

Adopting My Place: Manly makes clear Council’s intent that an approved outdoor dining area associated with an approved food and drink premises can operate in the Manly centre, particularly The Corso. Additionally, enhancing the night-time economy of Manly will require careful management and cooperation with all stakeholders of the centre to facilitate a pleasing and safe environment at night-time.

Implementation of the place plan will commence through a staged approach. Indicative timeframes for delivery over 10 to 15 years in terms of quick wins, short-term, medium-term and long-term (Years 5-15), have been allocated to each action in the plan’s Action Plan, subject to funding.

Financial Considerations

The public domain improvements identified in the ‘Key Places’ concept designs are estimated to cost approximately $25.9 million (includes a 30% contingency), predominantly prioritised in the medium to long term (4-15 years).

The Draft Northern Beaches Section 7.12 Contributions Plan 2024 seeks to allocate $6.8 million towards actions in the Plan over the next 10 years and $1.5 million is also forecast through the Manly Special Rate funded Manly Laneways program. The delivery of the actions listed in My Place: Manly will require and is subject to additional funding. My Place: Manly provides a platform to seek grant funding and other opportunities to close the funding gap and will be considered in future long term financial planning.

Governance and Risk Considerations

The development and drafting of My Place: Manly is based on targeted engagement via the Manly Project Working Group, specific stakeholders and the community. A ‘Community Stakeholder Engagement Plan’ incorporating a risk assessment was prepared and included appropriate opportunities to consider the risks and community concerns associated with the place plan and its proposed actions.

Environmental Considerations

The actions in My Place: Manly will result in a beneficial environmental outcome by contributing to one of the place plan’s guiding principles – ‘Natural beauty and resilience’. The principle has specific objectives that involve protecting unique ecosystems, encouraging the community to embrace green practices, and facilitating an increase in the urban tree canopy to create quality green streets and public spaces. This is in line with increasing canopy cover as a priority/action in the Local Strategic Planning Statement- Towards 2040 (LSPS) and District Plan and is also consistent with Council’s recently adopted Tree Canopy Plan.

Social Considerations

My Place: Manly aligns closely with Council’s aims of social inclusiveness and connectiveness along with implementing initiatives to manage social conflict between user groups within Manly. Several guiding principles in the place plan address social consideration including the principles of ‘Active and vibrant community spaces’ (which enhance community interactions), ‘Inclusive community and connection to culture’, and ‘Connected and accessible for all’ (with a specific action related to Council’s Disability Inclusion Action Plan).

Enhancing the 24-hour economy in the Manly centre will require balancing competing land uses to co-exist in Manly as a mixed-use strategic centre, leveraging on its appeal as a major tourism precinct and being a night-time economy centre. A whole of government approach will be required for activities/land uses to operate cohesively for example, night-time scheduling and frequency of public transport. The ‘agent of change’ approach involves, at its basic premise, an acknowledgement by all stakeholders that part of the appeal of the Manly centre is its vibrancy, convenience, and beautiful coastal setting, and as a consequence, an understanding by all stakeholders of the mixed land uses of the centre.

Any enhancements to the centre and its operations will need to be monitored by agencies such as NSW Police, Council rangers and the Liquor Accord to mitigate anti-social behaviour and alcohol-related violence.

The unique and highly valued indigenous cultural heritage and European built heritage of Manly has likewise been recognised and represented in initiatives and actions within My Place: Manly. The relevant guiding principle within the place plan is titled ‘Inclusive Community and Connection to Culture’ with the aim of ‘recognising Manly’s significant built, landscape and cultural heritage, acknowledging and respecting indigenous heritage and supporting a cohesive creative community’.

Link to Strategy

The commitment to deliver a place plan for the Strategic Centre of Manly was originally contained in Council’s Community Strategic Plan (CSP), Shape 2028, and the subsequent Delivery Programs. This commitment has been reiterated in the LSPS.

This report relates to the Community Strategic Plan Outcomes and Goals:

· Environmental sustainability - Goal 5 Our built environment is developed in line with best practice sustainability principles.

· Community and belonging - Goal 8 Our community feels safe and supported.

· Housing, places and spaces - Goal 11 Our local centres are vibrant and healthy, catering for diverse economic and social needs.

· Vibrant local economy - Goal 13 Our businesses are resilient, well-connected and thrive in an environment that supports innovation, entrepreneurialism and economic growth.

· Vibrant local economy - Goal 15 Our centres are sustainable, encompassing a diverse range of businesses that attract visitation and provide work, education, leisure and social opportunities.

· Good governance - Goal 20 Our Council is proactive, and efficiently and effectively responds to, and delivers on, the evolving needs of the community.

· Partnership and participation - Goal 21 Our community is engaged in decision making processes.

Reporting team

Strategic & Place Planning

TRIM file ref

2024/268257

Attachments

⇨1 Final document - My Place: Manly (Included In Attachments Booklet)

⇨2 Community Engagement Report - My Place:Manly (Included In Attachments Booklet)

Item 12.3 Northern Beaches Council MEETING - 25 June 2024

ITEM 12.3

Review of Affordable Housing Policy and Contributions Scheme to implement a flat rate affordable housing contribution

Purpose

The purpose of this report is to seek Council’s endorsement to take steps to introduce a ‘flat rate’ affordable housing contribution for an identified range of development not currently subject to affordable housing contributions.

Executive Summary

· Council’s Affordable Housing Policy for the Northern Beaches Local Government Area outlines Council’s position and approach to the provision of affordable housing in the Northern Beaches, and together with the Affordable Housing Policy Action Plan, guides Council’s actions to support affordable housing.

· In December 2021, the Department of Planning and Environment endorsed Council’s Local Housing Strategy which adopts a target of 1,884 new social and affordable housing dwellings by 2036.

· In April 2022, the Department endorsed Council’s Affordable Housing Contribution Scheme which is the primary mechanism for Council to levy for affordable housing, but only in areas subject to up-zoning through amendments to its Local Environmental Plans (LEPs).

· Several approvals have been granted for development involving the dedication of affordable housing dwellings to Council however, for a range of reasons the rate of creation of new affordable housing is slow and will not meet Council’s target.

· The State Government is proposing changes to State Environmental Planning Policy (Housing) 2021 to increase the supply of low and mid-rise housing within the Northern Beaches, which has the potential to create thousands of new dwellings, but does not involve the provision of new affordable housing.

· To help achieve its target for affordable housing dwellings for the Northern Beaches, it is recommended that Council undertake feasibility studies and prepare amendments to its LEPs, Affordable Housing Policy (which is due for review), and Affordable Housing Contribution Scheme to introduce a broad based/flat rate affordable housing contribution on new development (to be determined) outside areas subject to ‘up-zoning’.

RECOMMENDATION

That:

1. Council endorse the preparation of a feasibility study, draft amendments to Council’s Affordable Housing Policy and Affordable Housing Contributions Scheme and prepare a Planning Proposal to amend Council’s current Local Environmental Plans, to introduce a flat rate affordable housing contribution for development not subject to a rezoning proposal.

2. A further report be presented to Council upon completion of the work identified in Item 1 and prior to the public exhibition of proposed amendments.

Background

In June 2017, Council adopted the Affordable Housing Policy (AHP) for the Northern Beaches Local Government Area. The policy outlines Council’s position and approach to the provision of affordable housing in the Northern Beaches, and together with the Affordable Housing Policy Action Plan, guides Council’s actions to support affordable housing (Attachment 1 and 2).

In March 2018, the Greater Sydney Commission (GSC) released the Greater Sydney Region Plan – A Metropolis of Three Cities (The Region Plan), which presents a vision for managing Sydney’s growth for the next 20 years. This includes affordable housing rental targets generally in the range of 5–10 per cent of new residential floor space being viable for areas of upzoning.

In March 2020, Council’s Local Strategic Planning Statement (LSPS) was endorsed which seeks a minimum 10% affordable rental housing for all planning proposals for upzoning, urban renewal or greenfield development, with higher rates where financially feasible.

In December 2021, the Department of Planning and Environment (the Department) endorsed Council’s Local Housing Strategy (LHS) which adopts a target of 1,884 social and affordable housing (SAH) dwellings (the expected additional demand to 2036), and to prepare an affordable housing action plan to consider additional measures to help Council achieve the SAH target.

In April 2022, the Department endorsed Council’s Affordable Housing Contribution Scheme (AHCS) which is the primary mechanism for Council to levy for affordable housing through its Local Environmental Plans (LEPs). It allows Council to collect developer contributions to provide affordable housing either as complete dwellings or as an equivalent monetary contribution. The Scheme currently applies to the Frenchs Forest Planned Precinct and 1294-1300 Pittwater Road and 2-4 Albert Street Narrabeen, and contains principles and objectives, contribution rates, calculation method, and conditions and administrative requirements.

Council has received and assessed several development applications for development including an affordable housing contribution to Council in these localities, however none of the developments have been completed to date and Council has not yet received any affordable housing dwellings.

Councillor briefing on affordable housing

At its meeting on 27 June 2023, Council considered a Notice of Motion which addressed housing affordability on the Northern Beaches (Attachment 3). In part, Council resolved:

That the Chief Executive Officer provide a briefing prior to the December 2023 Council meeting, addressing the following topics:

1. Mechanisms to encourage properties which are currently STRAs and vacant properties to enter the rental market,

2. Strategies for building social and affordable housing on suitable land already owned by Council.

3. Further amendments which could be explored to our planning rules and affordable housing contributions scheme to address housing affordability, for example, changes to how we levy affordable housing contributions, encouraging further social and affordable housing, and “missing middle” style housing.

A briefing was provided by SGS Economics to Councillors on 21 November 2023 regarding:

· Council’s existing policies and strategies that seek to address the issue of housing affordability

· the existing regulatory framework and policy positions at the Commonwealth, State and Local Government level

· broader context of resources and affordable housing applications both internationally and domestically

· development feasibility and supporting affordable housing delivery

· alternatives and potential approaches.

A short report was provided by SGS Economics (Attachment 4) summarising the Councillor briefing. The report also provides options for consideration and potential further action by Council, including:

1. Explore the merits of an area or precinct-specific AHCS, as applied to an area designated for rezoning and an LGA-wide inclusionary zoning-style contribution rate, as applied to all sites regardless of rezoning.

2. Explore principles guiding the use of Council-owned land.

3. Explore strategies and alternatives for disposition of suitable Council-owned land.

4. Examine short-term rental accommodation regulation alternatives.

5. Examine recent developments in the enactment of NSW’s Short Term Rental Accommodation 180-day cap and the process and requirements that may be available for Northern Beaches to establish an alternative day cap.

Limitations on Affordable Housing Contributions Schemes

Council’s Affordable Housing Policy and AHCS apply to all new strategic plans and planning proposals to rezone land for urban development or greenfield development. The policy does not apply to other development not subject to a rezoning. For example, development in the Dee Why Town Centre is not subject to the AHCS as the land was rezoned for higher density development before the current affordable housing controls came into effect.

This policy approach is consistent with the directions of the State Government at the time of commencement of the AHCS and Council’s Policy.

Over the last 3 years building activity has been subdued because of the COVID pandemic, weak economic climate, high interest rates and rising building costs. This has reduced the amount of development take-up, and therefore the receipt of affordable housing contributions, within areas currently identified within Council’s AHCS, and in particular the Frenchs Forest precinct.

Given this, and the fact that Council does not receive and support many planning proposals seeking to upzone land, the ability to achieve additional affordable housing dwellings through the existing AHP and AHCS is limited.

A review of Council’s AHCS is one mechanism that can be explored to broaden the scope of affordable housing contributions, which could also benefit a wider geographical area.

Contributions under current Affordable Housing Contributions Scheme

Council’s AHCS has been in operation since 2022. Since its adoption, and inclusion of the Frenchs Forest Planned Precinct, and 1294-1300 Pittwater Road & 2-4 Albert Street Narrabeen, Warringah Local Environmental Plan 2011 has been amended to include an affordable housing clause.

The LEP clause identifies what development it applies to, the contribution rate for the purpose of affordable housing and how it is to be dedicated. Within the Frenchs Forest Precinct 15% of the gross floor area is to be provided as an affordable housing contribution within the town centre, and 10% outside of the town centre. The site at Narrabeen has a 1.7% contribution rate.

Five development applications have been lodged with Council within the Frenchs Forest Precinct that are captured by the AHCS and affordable housing clause, totalling up to 25 units dedicated to Council for the purposes of affordable housing.

Whilst development applications are starting to be received, Council needs to take further action to ensure the provision of affordable housing stock to meet the future needs of residents on the Northern Beaches.

The case for a broad-based or flat-rate contributions scheme

One of the recommendations of the SGS briefing and report was that Council should consider a more broad-based affordable housing contributions scheme, applying to land other than land that is being ‘up-zoned’.

As detailed within Council’s LHS, there is also an existing undersupply of affordable housing across the Northern Beaches LGA. The LHS established a target of 1,884 social and affordable housing (SAH) dwellings (the expected additional demand) to be provided in the LGA by 2036. To achieve this target, Council needs to find additional ways to provide affordable housing.

Outside of the existing centres nominated in the LHS for precinct planning, there are limited opportunities for large scale upzoning due to many constraints including limited public transport options, limited road accessibility and significant environmental constraints. As a result, there are limited options for the capturing of affordable housing contributions within the existing AHCS framework.

Impact of proposed Government Low- and Mid-Rise housing policy changes

In December 2023, the Department released an Explanation of Intended Effect (EIE) outlining proposals to amend the State Environmental Planning Policy (Housing) 2021 to increase low and mid-rise housing supply. On 27 February 2024, Council resolved to forward a submission to the Department and called for the NSW Government to abandon the low and mid-rise housing reforms, noting that the Northern Beaches Council has the capacity to plan for future growth as outlined in our adopted LHS.

The proposed changes, as outlined in the EIE, proposed to permit:

· dual occupancy development in all R2 low-density residential zones

· terraces, townhouses, and residential flat buildings (manor houses) of 2-3 storeys in R2 low-density residential zones within 800m of certain town centres

· shop top housing to 6-7 storeys within E2 zoned centres and in E1 and MU1 zoned areas of these town centres

· residential flat buildings to 6-7 storeys in the R1 General Residential zone and R3 Medium Density Residential zone within 400m of these identified town centres, and to 5 storeys from 400m to 800m of those town centres.

The proposals are, in effect, a rezoning of land to permit higher density development. If they proceed, thousands of additional dwellings will be constructed in the LGA. Concerningly, the proposals do not include requirements for the provision of additional affordable housing and Council’s current AHCS will not apply to the new development.

A key concern Council raised in its submission to the State Government was that changes of this scale should be accompanied by amendments to existing Council-made infrastructure contribution plans and affordable housing contribution plans, or as an alternative, be subject to increased ‘flat-rate’ contributions, e.g. 3% to 5% levy for infrastructure and affordable housing contributions made under the SEPP.

Council will continue to raise these concerns with the Department however, it is understood that the Department is likely to introduce changes as early as July 2024 with the aim that the policy will come into effect in the third quarter of 2024.

Introducing a flat rate contribution in areas outside of up-zoned areas would result in contributions being received in relation to some or all the new development contemplated by the proposed State Government policy proposals. This would also be consistent with the actions of some other councils which have introduced or a seeking to introduce a broad based/flat rate affordable housing contributions on development applications where no up-zoning has occurred.

Examples of Flat Rate Contributions in other Council Areas

Councils such as Willoughby and the City of Sydney, have applied a broad and low percentage rate across large parts of their local government areas.

Willoughby requires the dedication to Council of complete dwellings or their cash equivalent equaling 4% of total Gross Floor Area (GFA) of new multi-unit dwellings in identified zones.

The City of Sydney applies a 3% affordable housing contribution rate to all residential floorspace in Green Square and 1% to non-residential floorspace. In the Ultimo/Pyrmont area, a 0.8% contribution rate is applied to residential floorspace and 1.1% applied to non-residential floorspace.

Waverley Council currently has a planning proposal with the Department that proposes a contribution on all new residential flat buildings, independent living units, multi-dwelling housing, and shop top housing development of 1% of GFA at a flat $ rate/sqm.

Newcastle City Council also has a planning proposal with the Department that proposes an affordable housing contribution of up to 5% of total GFA for all residential and mixed-use development within 5 nominated areas, with a flat 1% contribution rate to apply to all residential and mixed-use development that results in an additional dwelling and more than 200sqm of residential GFA on the site in all other areas in the LGA.

In terms of financial impact on the cost of housing, in the short-term, if a developer had not accounted for a cost (such as an inclusionary zoning mandate), the costs are borne by the developer. In the medium to long-term, these costs are built into the cost profile of any potential development prior to the acquisition of a development site, thereby directly reducing the sale price landowners could achieve for development sites as purchasers would require a tenable profit margin (effectively shifting the windfall ‘planning gain’ from private to public interests).

This is reflected by the NSW Productivity Commission Review of Infrastructure Contributions in NSW:

“Contributions do not necessarily add to the final price of new housing. The maximum price achievable for a new apartment or dwelling will be determined to a large degree by the broader housing market, with consideration of the unique characteristics of the property and its location. When a contribution is levied, to the extent that the broader housing market and characteristics of the dwelling are no different, the maximum price achievable for the dwelling would remain unchanged.”

Process to implement a broad-based affordable housing contribution

Council would need to undertake further research and financial viability testing to determine:

1. the types of development applications to which it would apply

2. the most appropriate contribution rate to be applied.

Once this has been determined, draft amendments would be prepared to the AHCS. The changes would also require amendments to all Council’s current LEPs as those plans refer to the AHCS.

Consequently, a planning proposal to amend those LEPs would also be drafted. Subject to the approval of Council and the Department, the planning proposal for LEP changes and draft amended AHCS would be placed on public exhibition. Any changes would not commence until Council considers submissions and the Department/ Minister approves the LEP changes.

Conclusion

The levy of affordable housing contributions provides a transparent framework and certainty and clarity for the community and development industry. Introducing a broad-based contribution rate could be the only way to achieve enough funds to be used for purpose-built affordable housing to achieve Council’s adopted SAH target of an additional 1,884 dwellings to 2036.

It is therefore recommended that Council proceed to develop a broad based/flat rate affordable housing contribution on a range of, to be determined, development applications where no up-zoning has occurred as part of a review of Councils AHCS and AHP.

Consultation

Internal discussions have occurred with relevant business units.

External consultation on any proposed amendments to the existing Affordable Housing Strategy and Affordable Housing Contributions Scheme would not occur until such time as Council has considered the recommendations of the feasibility study and considered any resultant policy amendments.

Timing

Undertaking required feasibility studies and preparing a planning proposal to amend Council’s current LEPs will take several months to complete. Approval of the Department may also take several months. The public exhibition process and final approvals from Council and the Department will also take several months.

Given the above, any changes to contributions are unlikely to commence for 12 months.

Financial Considerations

A consultant would be engaged to undertake financial viability testing to inform the development types and associated contribution rate(s), which would cost approximately $25,000 funded within the existing Strategic & Place Planning budget.

If affordable housing is provided and retained under Council ownership, Council will control a larger asset portfolio which will increase in value. The management of ongoing maintenance costs of any affordable housing will be considered during the engagement of a community housing provider.

Governance and Risk Considerations

Appropriate governance arrangements will need to be in place regarding the transfer of affordable housing stock (or financial contribution) to Council and the subsequent management by a Community Housing Provider.

Environmental Considerations

The provision of affordable housing on the Northern Beaches could contribute to reduced transport emissions by reducing the need for key workers to travel long distances.

Social Considerations

The implementation of the affordable housing policy will have a positive social impact by increasing the supply of affordable rental housing in the community for very low, low to medium income households.

Link to Strategy

This report relates to the Community Strategic Plan Outcome and Goal:

· Housing, places and spaces - Goal 10 Our community has access to diverse and affordable housing options to meet their current and evolving needs.

Reporting team

Strategic & Place Planning

TRIM file ref

2024/269053

Attachments

⇨1 Affordable Housing Policy (Included In Attachments Booklet)

⇨2 Affordable Housing Policy Action Plan (Included In Attachments Booklet)

⇨3 Notice of Motion - Housing Affordability on the Northern Beaches (Included In Attachments Booklet)

⇨4 Council Affordable Housing Briefing Summary Report (Included In Attachments Booklet)

Item 12.5 Northern Beaches Council MEETING - 25 June 2024

ITEM 12.5

Response to Notice of Motion No 6/2024 - Ticketless Parking System

Purpose

The purpose of this report is to provide the information requested in Notice of Motion No 6/2024 - Ticketless Parking System.

Executive Summary

· Northern Beaches Council commenced use of the Revenue NSW ‘Print and Post’ service to issue parking infringement notices on 4 March 2024, commonly referred to as ‘ticketless parking’.

· Revenue NSW is progressively moving all councils to the system, with 78% of Sydney metropolitan councils having successfully adopted the system.

· The ‘Print and Post’ service has significantly increased the safety of parking enforcement staff, ensuring Work Heath and Safety obligations are met.

· Council has issued 11,835 parking infringements via the ‘print and post’ system, with the productivity of parking enforcement officers increasing by 76%, and revenue increasing by 61.7%.

· Since implementation, Council has received 2 complaints from members of the community raising broad, in-principle concerns regarding the ticketless system.

· There have been 174 requests made to Revenue NSW for fines to be reviewed, none of which have raised concerns about the ‘ticketless parking’ system in their request for a review, rather they have raised concerns about parking signage and ticket machines, like those received for hardcopy ‘docket style’ infringements,

· Direct financial implications of reverting back to hardcopy ‘docket style’ infringement notices is estimated to be $30,000 per year, plus a one-off additional cost of $40,000 for equipment.

RECOMMENDATION

That Council note the report.

Background

On 26 March 2024 Council resolved:

That Council:

1. Note:

a. The recent decision by Council to transition to a ticketless parking system, which involves the adoption of the Revenue NSW Print and Post service for issuing parking fines.

b. The decision to cease leaving paper/physical parking dockets on cars raises concerns among the community regarding potential inconvenience, procedural fairness and financial burdens.

c. The new system may hinder the ability to dispute fines or respond promptly due to reliance on email notifications, which could be misplaced or overlooked.

d. The Minister for Finance, the Hon Courtney Houssos MLC, has highlighted shortcomings in the ticketless parking system, particularly regarding the timeliness of notifications to drivers and the difficulty in gathering evidence for fine reviews.

2. Staff provide a report at the earliest opportunity which:

a. Evaluates the feasibility, possibility and legal implications of reversing the decision of Council to discontinue the ticketless parking system.

b. Assesses the feasibility and associated costs of introducing a paper-based parking notification system, coupled with the incorporation of Revenue NSW's Print and Post service for issuing parking fines. This evaluation should emphasise the preservation of transparency and accessibility for residents, as underscored by concerns voiced by Minister Houssos and the community. Key considerations include the provision of immediate written notifications to drivers upon fine issuance and streamlining evidence gathering processes for fine reviews.

c. Details the current process or procedure adopted by Council with the introduction of the ticketless parking system, aimed at identifying any gaps or missing requirements that could enhance community benefits.

DISCUSSION

What is ‘Print and Post’?

Northern Beaches Council commenced use of the Revenue NSW ‘Print and Post’ service to issue parking infringement notices on 4 March 2024. This method for issuing parking infringement notices is commonly referred to as ‘ticketless parking’. Council has issued 11,835 parking infringements using this system. Council has also issued 137 hard copy ‘docket style’ system for some parking matters.

Revenue NSW introduced the ‘Print and Post’ ticketless parking system for local councils to help address shortcomings with the use of hardcopy ‘docket’ style infringement notices, which included:

· recipients being confused by the shopper docket-style fines and the limited information provided on the actual parking ticket

· fines being removed from vehicles, leaving recipients unaware of the fine until they received a reminder notice, with less time to act

· safety concerns for parking officers from adverse confrontations with members of the public

· administrative costs and staff resources required undertake ownership searches and mailing out letters and fines.

The rollout of the service to councils across NSW followed a 3-month pilot with Burwood Council in 2020. During the trial, over 4,800 infringement notices were issued by Burwood Council using the ‘ticketless’ system.

The pilot was successful, with no complaints being recorded by Revenue NSW or Burwood Council during the trial. No concerns were raised about the ticketless delivery method. There was a decrease in abusive behaviour towards regulatory staff, who in turn felt safer, more engaged, and more productive in their duties, with the time to process fines also improving.

As the first council to issue ‘ticketless’ infringement notices, there were some initial concerns voiced about the absence of a ‘docket style’ infringement notice. However, the council addressed this with further information being made available on their website.

Due to the success of the Burwood Council trial, Revenue NSW has been progressively moving all councils to the ‘Print and Post’ system over the past 4 years, with 78 % of Sydney metropolitan councils having already successfully adopted the system.

Given the widespread use of the ‘Print and Post’ system across Sydney, and similarities of this system to the receipt of driving infringements also issued by Revenue NSW, such as speed and mobile phone camera offences, there is broad, general community awareness of ‘ticketless’ infringement systems and how they operate.

How does Print and Post work?

The process parking enforcement officers undertake in establishing a parking offence and collecting evidence of the offence is the same, irrespective of whether the infringement notice is issued via a ‘ticketless’ method, or via a hardcopy ‘docket style’ method.

In all cases the officer:

1. Identifies the relevant offence and takes photographs as evidence - the vehicle is photographed to collect identification details and evidence of the offence. Examples of evidence collected includes the absence of a payment or valid parking permit, vehicle registration details, timed chalk imprint on the tyre, as well as photographs of relevant signage identifying the relevant parking restrictions.

2. Checks the vehicle registration to confirm whether any active parking payments or permits are in place, and that no recent fines have been issued to the vehicle on the same day.

When using the Revenue NSW ‘Print and Post’ service, the evidence collected is uploaded to the Revenue NSW server. This takes approximately 2 minutes and does not need to occur at the scene of the offence. The following day Revenue NSW creates the penalty infringement notice and sends the infringement to the registered owner of the vehicle within 2 to 3 days. The letter that is issued to the registered vehicle owner details clearly how recipients can access further information, including photos, via the Revenue NSW website (refer to example in Attachment 5).

When using a more traditional hardcopy ‘docket style’ infringement, the officer manually enters the details of the offence into their PDA device and prints out a shopper-docket style infringement which is affixed to the vehicle (generally placed under the windscreen). This process takes approximately 4 minutes to carry out if the driver of the vehicle is not present at the time of the issue of the infringement. This time can increase substantially if the driver of the vehicle returns to the vehicle whilst the fine is being issued.

The most significant difference between the 2 processes is that paper ‘docket style’ infringements need to be printed at the time of issue, using a body worn mini printer. The paper ‘docket style’ ticket process also requires the officer to remain with the vehicle for the duration of issuing the ticket. This increases the risk to staff safety being compromised by verbal and/or physical abuse by members of the public who are aggrieved by the receipt of the fine.

Further information on the process of issuing a parking fine as well as examples of evidence and photographs collected is provided in Attachment 4.

Obligations to ensure Work Health and Safety

The nature of the parking enforcement role makes it one of the highest risk functions in Council from a Work, Health and Safety (WHS) perspective, with very high risks of employees sustaining both physical and mental injuries whilst at work.

Northern Beaches Council, like all employers, has a statutory obligation under WHS legislation to do everything reasonably practicable to ensure a physically and mentally safe workplace for staff.

Over the past 3 years, there have been 92 reported WHS incidents involving staff from the rangers’ team. A review of these matters has identified that 34 of the incidents would have been prevented if a ‘ticketless’ infringement had been issued.

Since commencement of ‘Print and Post’ ticketless system, there has been a decline in WHS related assaults and abuse being reported, and an increased confidence in personal safety expressed by the parking enforcement officers whilst performing their duties.

These workplace safety concerns were raised by Local Government NSW in their letter to the Minister for Finance on 15 March 2024 in response to media interest in ‘ticketless’ parking and the Minister of Finance’s letter to councils (Attachment 3).

The ‘Print and Post’ service fulfils Council’s obligations as an employer by minimising the risk of harm to parking enforcement officers, which is increased by issuing of hardcopy ‘docket style’ infringements.

The customer perspective

Council has received 2 complaints from members of the community raising broad, in-principle objections to the ticketless system since implementation in March.

However, sentiment expressed in media articles in March 2024 identified perceived shortcomings of a ticketless system as being insufficient evidence collected at the time the fine is issued, or that there is difficulty in gathering evidence in the event the vehicle owner wants to seek a review of the fine. Other concerns have included that there is a reduced impact of visibility of fines on windscreens, acting as an immediate deterrent to parking offences and influencing positive behaviours, and that a driver can receive multiple parking infringements before receiving a notification via post or the Service NSW app.

In practice, the evidentiary requirements which must be fulfilled to issue a fine, whether as a hardcopy or ticketless, are the same.

As shown in Attachment 4, the ‘Print and Post’ infringement provides more information, in a timelier manner, as photographic evidence is uploaded by the enforcement officer whilst in the field and this information is available to the owner of the vehicle when they receive their fine.

The ‘Print and Post ‘system also makes no difference to the ability of the vehicle owner to dispute the fine at the time of the offence, as officers have no ability to cancel a fine once issued. This is a risk management measure that has been implemented to reduce fraud and corruption risks.

If a fine has been correctly issued, the appropriate appeal mechanism is via Revenue NSW, as is the process for hardcopy ‘docket style’ infringements.

Since the implementation of the ‘Print and Post’ service, 11,835 infringement notices have been issued, and 174 requests have been made to Revenue NSW for fines to be reviewed (representing 1.5% of total fines issued).

None of the requests for review have raised the ‘ticketless’ infringement system as a reason for the review, rather the reviews have related to concerns about parking signage and ticket machines, like those received with hard copy ‘docket style’ system.

Financial and legal considerations

There are no anticipated financial penalties or legal impediments that Northern Beaches Council would be subject to by Revenue NSW should Council resolve to revert to hard copy ‘docket style’ infringements. However, noting that Revenue NSW are transitioning all councils to the system, there is expected to be future reputational, legal, and financial risks of moving away from the ‘Print and Post’ system.

There will be immediate additional financial costs to Council to revert to hard copy ‘docket style’ infringements. An additional $30,000 per annum will be required to cover staff time and costs associated with relevant registration searches, preparation, and postage. This is not included in the 2024/25 budget.

There will be recurring costs associated with the purchase of approximately 40 handheld printers every few years. The existing assets have come to the end of their shelf life and an immediate cost of replacement is $40,000 will be required should council resolve to revert to hard copy ‘docket style’ infringements. This is not included in the 2024/25 budget.

Productivity gains

Since the implementation of ‘Print and Post’ there has been a boost to productivity by 76% when compared to infringements issued for the same period in 2023, and 79% when compared to 2022.

Issuing a ‘ticketless’ infringement takes approximately 2 minutes, which includes taking photographs for evidence of the offence, and uploading this information to Revenue NSW. This is in contrast to issuing an infringement notice via hard copy ‘docket style’ which takes double the time to issue (approximately 4 minutes) as well as the officer being required to stand next to the vehicle for that time, thereby increasing the risk of conflict with the driver of the vehicle. There were also some instances in the past where hard copy ‘docket style’ infringements could not be left on the windscreen of vehicles, such cases including where vehicles stopped in a No Stopping areas, Bus Zones, Double parking offences and Stopping on Intersections. In these cases, the infringement is sent out by post, thus substantially increasing the time between the issue of the fine and the receipt by the owner of the vehicle, and substantially increasing administrative tasks such as searches to obtain the vehicle’s ownership details.

The productivity gains of the ‘Print and Post’ system would be lost if Council reverted to hard copy ‘docket style’ infringements.

Implementation of a hard copy notification where a ‘ticketless’ infringement is issued

Implementation of a hard copy notification card on the windscreen of as vehicle that will receive a ‘ticketless’ infringement notice will negate any WHS benefits from the ticketless system.

It is understood from Revenue NSW that only 1 council in NSW (despite the advice from the Minister) currently place a notification card on vehicle windscreens to notify when an infringement is issued. Maitland Council has advised that this is not mandatory, but rather is only done when the officer feels that it is safe to do so.

The additional cost of using business-card sized notification cards would be approximately

$5000 per year. This is not included in the 2024/25 budget.

Consultation

Revenue NSW was consulted in relation to this matter. The advice received from Revenue NSW was to maintain use of the ‘Print and Post’ service in its normal manner.

Timing

There are no timing issues.

Financial Considerations

There would be budget impacts if Council resolved to revert to hard copy ‘docket style’ infringements. These are not included in the 2024/25 budget.

There would also be budget impacts if Council resolved to place notification cards on vehicles.

Governance and Risk Considerations

The ‘Print and Post’ service minimises organisational risks by ensuring the WHS obligations of Council as an employer are maintained.

Environmental Considerations

The ‘Print and Post’ service results in a beneficial environmental outcome by seeking to avoid potential detrimental environmental impact as a consequence of litter generation from notification cards or ‘docket style’ infringements attached to vehicle windscreens.

Social Considerations

The ‘Print and Post’ service does not result in any social impacts.

Link to Strategy

This report relates to the Community Strategic Plan Outcome and Goal:

· Good governance - Goal 20 Our Council is proactive, and efficiently and effectively responds to, and delivers on, the evolving needs of the community.

Reporting team

Environmental Compliance

TRIM file ref

2024/367911

Attachments

⇨1 Letter Hon Courtney Houssos MLC, Minister for Finance (Included In Attachments Booklet)

⇨2 Letter to Council from Commissioner of Fines Administration (Included In Attachments Booklet)

⇨3 Letter from LG NSW to Hon Courtney Houssos MLC, Minister for Finance (Included In Attachments Booklet)

⇨4 Parking Enforcement Process (Included In Attachments Booklet)

⇨5 Examples of Hardcopy and ticketless fines (Included In Attachments Booklet)

Item 13.2 Northern Beaches Council MEETING - 25 June 2024

ITEM 13.2

Response to Notice of Motion NO 7/2024 - Rialto Lane, Manly

Purpose

The purpose of this report is to outline the opportunities and constraints related to the activation of Rialto Lane, Manly, as requested by Council at its Ordinary Meeting on 26 March 2024 in relation to Notice of Motion No 7/2024 – Rialto Lane, Manly

Executive Summary

· Rollers Bakehouse (café) had been using the footpath in Rialto lane for outdoor dining purposes for several years without approval and was asked to remove furniture and objects from the footpath on multiple occasions.

· Council traffic engineers concluded that the current configuration of the lane is not safe for outdoor dining due to the considerable risks to pedestrians and café patrons posed by vehicular traffic in the laneway.

· Reconfiguring the lane to safely accommodate outdoor dining was investigated but is not possible without impacting nearby residents and disrupting businesses by restricting or reducing access to loading zones.

· Feedback from nearby businesses does not indicate strong support for relocating, removing, or changing the operating hours of the loading zone in Rialto Lane.

· Coles advised that any reduction in the width of the laneway or reduction in hours of use of the laneway would be catastrophic for their operations.

RECOMMENDATION

That Council note the contents of this report.

Background

On 26 March 2024 Council resolved the following:

That Council receive a report setting out opportunities and constraints to providing the activation of Rialto Lane, Manly, including but not limited to:

1. Any costs associated with works to facilitate widening of the pedestrian area to provide seating, impacts of such changes on the function of Rialto Lane as a delivery zone as identified in the Draft Manly Place Plan, pedestrian safety and/or impacts on the existing rights of landowners/businesses.

2. Whether efforts by existing businesses to activate the lane could be accommodated in an updated design of the lane.

3. Opportunities and limitations for outdoor dining without changes to the widening of the pedestrian area consistent with Council’s Outdoor Dining and Footpath Merchandise Guidelines. This may include planter-box or fencing options and/or include ‘decorative screening’ (Draft Manly Place Plan, ‘Concept design idea for Rialto Lane’ pt. 4, pg. 100)

4. Advice on opportunities to further activate Rialto Lane, including whether a shared zone could be provided at certain periods to overcome any conflicting land uses.

5. Feedback from any business owners which may be affected by changes to the role and function of the lane and its immediate surrounds.

Discussion

In November 2023, Northern Beaches Council received a formal complaint regarding the unauthorised use of the pedestrian footpath within Rialto Lane for outdoor dining by Rollers Bakehouse, forcing pedestrian traffic into the movement zone of delivery trucks and other traffic using the lane. The footpath, approximately 1.5m in width and defined by a row of stainless-steel bollards, was not intended for outdoor dining use. Despite multiple requests and penalty notices, the café continued to use the space from 2019 until February 2024, when unauthorised items were finally removed.

Council traffic engineers assessed the site and determined it was not safe for outdoor dining due to risks posed by vehicular traffic.

Current Laneway Design

Rialto Lane has loading zones in place along its northern side, closest to the Corso (approximate location circled in blue in Image 1 below). The loading zones are in place to facilitate deliveries to premises fronting The Corso, Rialto Lane, Wentworth Street and South Steyne.

Previously, the presence of these loading zones resulted in trucks parking immediately adjacent to buildings on the north side of Rialto Lane, as per Image 2 below. This prevented pedestrian access and blocked building entry/exit (including emergency exits) to buildings facing the laneway and forced pedestrians out into the laneway into the path of circulating traffic.

As a result, the line of bollards offset approximately 1.5m from the building alignment was installed, as per Image 3 below. The bollards then ensured that trucks park further from the building frontages, creating a safe area for pedestrians to walk and access premises or egress buildings, which is of particular importance in an emergency situation.

Image 1 – Rialto Lane and Wentworth Street – Loading Zones shown in Blue and Red

Aerial view of a city

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Image 2 – Truck parking adjacent to buildings blocking exit without bollards

Image 3 Footpath blocked behind stainless steel bollards by plants and furniture

A white truck parked on a street

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Possible Alternative Configurations and their Impact

Council’s outdoor dining guidelines require a width of at least 2 metres of unobstructed footpath to safely maintain circulation of pedestrian traffic. The use of fencing, screening or other items as barriers such as planter boxes does not remove or reduce this requirement. As the existing footpath area is only approximately 1.5m in width, it is not possible to comply with the guidelines and accommodate outdoor dining without widening the footpath.

Opportunities to re-configure the laneway to allow for further activation and remain compliant with outdoor dining guidelines as well as the associated constraints have been considered and are outlined below.

1. Opportunity: Widening the existing footpath to allow safe pedestrian passage and accommodate outdoor dining within the laneway.

Constraints: Widening the footpath to accommodate outdoor dining would require removal or relocation of the existing loading zones to allow enough clearance for trucks and other vehicles to navigate the laneway and maintain the required 2m pedestrian clearance.

Businesses in the vicinity are heavily reliant on the Rialto Lane loading zones to receive deliveries. There is no vehicular access to the plaza section of The Corso and no parking on South Steyne between The Corso and Wentworth Street, so options for delivery drivers to park and service businesses in this vicinity are limited. The existing loading zones on Wentworth Street (see Image 1 above circled in red) would need to be extended in physical length and hours of operation (currently 6am to 9am Monday - Saturday), to replace the loading zones in Rialto Lane and would result in:

a) removal of approximately 8 high-demand short term parking spaces that are well used by customers of local business fronting Wentworth Street

b) an increase to the distance drivers performing deliveries to premises on The Corso would have to cover on foot to reach their destination

Removing or relocating the loading zones would facilitate movement of vehicles through the lane, however larger delivery vehicles (such as those used by Coles) would not be able to manoeuvre through the laneway with any further reduction in width of the laneway without causing damage and posing a safety risk to users of any extended footpath area. These larger vehicles need to swing wide (close to Rollers) to take the right-hand turn at the end of the lane and return out on to Wentworth Street and have damaged the bollards outside Rollers on numerous occasions at its current width.

The cost of required works to accommodate outdoor dining in the laneway by widening the footpath, including relocation of bollards, line marking, removal of existing loading zone signage and installation of new loading zone signage is estimated at minimum of $19,500, excluding staff time and consultation costs.

2. Opportunity: ‘Localised Footpath Widening’ - Widening a smaller length of the footpath area could accommodate outdoor dining immediately outside the café, while potentially maintaining some of the existing loading zones.

Constraints: Localised widening of the footpath area would need to be tapered along the laneway as it heads towards the café, resulting in some but not all of the existing loading zones requiring relocation to Wentworth Street.

Any decrease in the trafficable laneway due to localised widening would still cause a bottleneck in traffic flow and due to its proximity to the corner, make it impossible for larger delivery trucks (such as those used by Coles) to pass through the laneway and complete the right-hand turn to exit the lane. Further, localised widening of the footpath area is not recommended due to the risk of inattentive drivers not realising that the width of the laneway is changing, placing pedestrians and café patrons at risk and increasing risk of damage to the bollards.

Concerns outlined in Option 1 relating to loss of parking on Wentworth Street and increased distances to be covered by delivery drivers on foot are also applicable.

Required works to accommodate outdoor dining in the laneway through localised widening are very similar to works required under Option 1 above and cost is estimated at a minimum of $19,500, excluding staff time and consultation costs.

3. Opportunity: Amend Hours of Loading Zones to create a shared zone in Rialto Lane. Limiting operational hours of loading zones in Rialto Lane to before 7am and after 3pm would accommodate activation of the laneway / outdoor dining during the day.

Constraints: Feedback from surrounding businesses and observed heavy use of the laneway indicate that there would be significant impacts on the businesses in surrounding area should operating hours of loading bays be reduced to facilitate activation of the laneway during the day.

Businesses currently utilise the loading zones from early morning through to the evening. Adjusting loading zone hours to accommodate outdoor dining during the day would provide only a brief window in which deliveries could be received and would be disruptive to these businesses.

Further, residents of the Peninsula Building immediately above Rialto Lane would be impacted by noise should deliveries be restricted to early mornings (prior to 6am) and allowed to continue later in the evenings. The DA condition relating to use of the Coles loading dock restricts hours of operation to 6am - 7pm for this reason. As such it is not considered feasible to restrict operational hours of loading bays to outside cafe opening hours of 7am – 3pm without impacting residents and causing disruption to nearby businesses.

Strategic Context

The activation of the Manly CBD and meeting community demand for outdoor dining within the Manly CBD is one of the central issues considered and wholistically addressed within the Manly Place Plan. With regards to Rialto Lane, the plan notes that “Rialto Lane is a place with enormous functional requirements and pressures, balancing people, cars, loading docks, servicing and waste collection” and proposes that “Changes to the eastern part of Rialto Lane will also be limited due to loading zones and ingress/egress of parking areas”.

As detailed previously, it is not considered possible to accommodate activation in the laneway by altering operational hours of the existing loading bays or updating the design of the laneway without having significant impact on nearby businesses and residents. The Manly Place Plan does not propose to further activate Rialto Lane, instead focusing on meeting demand for outdoor dining at other locations within the Manly CBD where it is safer and more appropriate to do so, such as Market Lane, nearby Rialto Square and Sydney Road.

Consultation

A survey of businesses in Rialto Lane was conducted to obtain feedback on the impact of potential changes to the role and function of the laneway. Thirty-two businesses provided a response, with a summary of the responses provided below:

1. Does your business use Rialto Lane for deliveries, if so how often and at what times?

· Usage of the Rialto loading zone commenced in the early morning from 6am.

· Based on responses received, usage typically appears to peak between 7am-10am however does continue throughout the day.

· Utilisation of the loading zone appears to be lowest in the evening / at night.

· Coles provided comment that they utilise the laneway consistently all day long.

2. Would you support reducing Rialto Lane loading bay size or operating hours?

· Thirteen of the businesses surveyed objected to any reduction in loading zone area or operating hours.

· Recurring comment was made that the laneway is already very busy / congested with delivery trucks and it is already difficult to get access. Further reducing loading zone access would make deliveries more difficult.

· Six of the businesses would support reduced access times or spaces but 3 were on the condition that they were replaced with a loading bay on Wentworth St.

· The remaining businesses either did not provide comment, required loading zones to be retained at specific times (ranging from early morning to afternoon) or noted that the loading zone directly outside their business was not removed.

3. Would you support increasing the size and operating hours of the loading zone on Wentworth Street (Note this would result in the loss of short term parking bays on Wentworth St).

· Eleven of the 31 businesses that responded were supportive of increasing the size and operating hours of the Wentworth Street loading zone.

· Another 11 of the businesses that responded were not supportive and were concerned that the loss of parking on Wentworth Street would impact trade or noted that Wentworth Street was not suitable for additional loading zone capacity for a variety of reasons (too far away, dangerous, not enough room for additional capacity).

· The remaining respondents did not provide comment.

4. Would you be interested in applying for outdoor dining on Rialto Lane if made available (note this would only be made available to businesses with direct access to Rialto Lane and would reduce size / hours of existing loading zone)?

· Of the estimated 12 businesses surveyed that may be eligible to apply for outdoor dining under Council’s Outdoor Dining Guidelines (i.e. a food and drink premise with direct access to Rialto Lane) 2 of the businesses said they would apply if it was allowed, 2 said possibly with more information and 8 said that they would not be interested in applying for outdoor dining area in the laneway.

Coles and its customers are one of the major users of Rialto Lane and Wentworth Street. Coles advised that any reduction in the width of the laneway or closure of the laneway for certain hours to facilitate outdoor dining would be catastrophic for their business. The delivery semi-trailers that deliver to the Coles loading dock are required to wait for loading bays to be cleared in-order to safely manoeuvre the corner out onto Wentworth Street. Coles would not support any further reduction in width of the laneway, noting that it is not feasible to reduce the delivery times given they are unable to deliver prior to 6am and deliveries are consistently arriving all day long through to the evening.

In addition to the consultation of the local business that may be impacted by any changes to the lane, it is worth noting that a residents carpark servicing the Peninsula building is also accessed near the entry to the laneway off Wentworth Street. Residents of the building have not been consulted as it is outside the scope of this report, however their interests should be considered prior to making changes to parking and loading zone conditions on Rialto Lane or Wentworth Street.

Timing

There are no applicable timing considerations.

Financial Considerations

The recommendations of this report pose no material financial impact for Council.

Governance and Risk Considerations

Council has a responsibility to maintain community safety standards. The risks created by interaction between pedestrians, café patrons and vehicular traffic cannot be mitigated for outdoor dining in this location and as such outdoor dining is not recommended in this location with or without amendments to the loading dock and laneway operations.

A further risk if outdoor dining was progressed in this location is the likely negative impact to surrounding businesses.

Environmental Considerations

The subject of this report has no environmental implications for Council beyond the traffic, parking and access considerations already discussed in this report.

Social Considerations

Staff acknowledge the positive social and economic impact that outdoor dining can have within the community and that there is demand for outdoor dining in this location from some sections of the community. However, meeting community demand for outdoor dining within the Manly CBD is addressed in the Manly Place Plan which does not propose to further activate or provide for outdoor dining in Rialto Lane which has an important role as a service delivery lane.

Link to Strategy

This report relates to the Community Strategic Plan Outcomes and Goals:

· Housing, places and spaces - Goal 11 Our local centres are vibrant and healthy, catering for diverse economic and social needs.

· Transport, technology and connectivity - Goal 17 Our community can safely and efficiently travel within and beyond the Northern Beaches.

Reporting team	Property, Building & Beach Services
TRIM file ref	2024/413518
Attachments	Nil

Recipient		Description	Allocation	Supported by Councillor **
The Centre for Volunteering		Financial assistance for two local volunteers to attend the 2024 Volunteering NSW State Conference	$610	Received directly through the Office of the Mayor
Local Resident *		Financial assistance to attend the 2024 Youth Parliament	$250	Received directly through the Office of the Mayor
Ingrid Bass trading as Umbrella School of Music		Financial assistance towards Camp Rock – a disability musical production	$1,000	Received directly through the Office of the Mayor
Local Resident *		Financial assistance to attend the National Leadership Forum at Parliament House, Canberra	$250	Received directly through the Office of the Mayor
Manly Wheelchair Basketball Association		Financial assistance towards hosting the 2024 National Wheelchair Basketball League on the Northern Beaches	$1,000	Received directly through the Office of the Mayor
Tibetan Community of Australia – Australian Tibetan National Association Inc.	Funding assistance for local Tibetan residents selected as part of the Tibetan Community of Australia Football Team for the Gyalyum Chenmo Memorial (GCM) Gold Cup in South India – May 2024		$1,000	Received directly through the Office of the Mayor
Northern Beaches Art Society	Funding assistance towards the Annual Awards Exhibition to be held at the Creative Space, Curl Curl in October 2024		$800	Received directly through the Office of the Mayor
3 x Local Residents *	Funding assistance to represent the Cook Islands and attend the 2024 FIT Touch World Cup and compete in the Open Women’s Team in England – July 2024		$1000	Received directly through the Office of the Mayor
Local Resident*	Funding assistance towards representing Australia at the World Aquatics Water Polo Championships in Malta – June 2024		$500	Received directly through the Office of the Mayor
The Village Chef (Ku-Ring-Gai Meals on Wheels Service)	Funding assistance towards the cost of providing a thank you breakfast during Volunteer Week to volunteers who serve on the Northern Beaches		$500	Received directly through the Office of the Mayor
Rotary Club of Upper Northern Beaches Inc.	Funding assistance towards the costs of holding their annual Rotary Art Show at Mona Vale in July 2024 (fundraising for Lifeline and Rotary Youth Programs)		$1,000	Received directly through the Office of the Mayor
Local Resident*	Funding assistance to represent the Cook Islands and attend the 2024 FIT Touch World Cup and compete in the Open Men’s Team in England – July 2024		$500	Received directly through the Office of the Mayor
Local Resident*	Funding assistance to assist with the costs to represent Manly Warringah Netball Association.		$250	Received directly through the Office of the Mayor
Local Resident*	Funding assistance to represent the Cook Islands and attend the 2024 FIT Touch World Cup and compete in the Open Men’s Team in England – July 2024		$500	Received directly through the Office of the Mayor

Reporting team	CEO
TRIM file ref	2024/387617
Attachments	Nil

Reporting team	Community Engagement & Communications
TRIM file ref	2024/400461
Attachments	⇨1 Suspension of the Alcohol Free Zone in Manly CBD Area - Site Map - Manly Jazz 2024 (Included In Attachments Booklet)

Reporting team	Community, Arts & Culture
TRIM file ref	2024/290969
Attachments	⇨1 Mona Vale Community & Cultural Precinct - Operational Model and Business Plan - Final Report (Included In Attachments Booklet)

Reporting team	Environment & Climate Change
TRIM file ref	2024/343581
Attachments	⇨1 Eco Schools Grant 2024 Applications Recommended for Funding (Included In Attachments Booklet)

TRIM file ref	2024/436098
Attachments	⇨1 Explanatory Attachments (Included In Attachments Booklet)