Good news yesterday with the council approving $500 million to cover their share of the extra City Rail Link costs. The decision came after a marathon meeting where Councillors started on the topic at 9:30am and didn’t finally make the decision till just after 4pm. In the end just two Councillors voted against providing the extra funding needed, they were Grey Sayers and Mike Lee. As expected, all along the way there was various amounts of grandstanding by some Councillors and clearly frustration from others at it all.

Perhaps the most interesting parts of the meeting that I saw were the presentations and answers from City Rail Link themselves. One thing that stood out was how much we’re now in a “sellers market” for big projects like CRL. As Chair Sir Brian Roche and CEO Dr Sean Sweeney said, there is so much work out there that contractors effectively get to choose what projects they want to work on. Delay things and there’s a risk they might walk away from the project altogether to focus on something else and that would mean the whole tender process would have to start again and the project would end up even more expensive. The scale of this is reflected in the comments at the announcement before Easter (and again yesterday) that the infrastructure pipeline in Australasia has jumped from $80 billion to $230 billion in less than two years.

During the meeting two of the more hotly debated topics were around the carparks and the government contribution. On the first of these, Councillors agreed to rule out the option of selling the AT carparks which would leave options such as leasing or redeveloping on the table. Many Councillors also wanted to see the government contribute to the increased cost more and they ultimately agreed they would formally write to the government asking for them to pay more. As mayor Goff and others pointed out though, this is unlikely to be very successful given he already had and been told no, and the agreement between council and government is quite clear about each picking up 50% of the costs.

While it would be ideal not to have had these extra costs, it’s great that the project has been able to pass this hurdle and that the funding was agreed. This is critical for City Rail Link so they can get on with the project and not endure any delays. It should also mean that over the next few weeks they’ll be able to confirm the contracts so they can get started, presumably later this year.

Mayor Phil Goff is clearly happy with the result

Auckland Mayor Phil Goff said the Auckland Council Governing Body’s approval of an additional $500 million in funding for the transformational City Rail Link was the right decision.

Mayor Phil Goff said, “This project is critical to the future of this city. More than $700 million has already been invested in the first two stages of the tunnel. Without the CRL, Auckland will hit gridlock and the city will grind to a halt.

“The CRL is the biggest investment Council is making in transport infrastructure in the next few years. Securing additional funding ensures it will be future-proofed for growth.

For anyone who wants to watch the meeting, or parts of it, you can see the videos below

1. This is the presentation from Viv Beck and subsequent questions.

2. This section is City Rail Link presenting and answering questions.

3. Presentations from Council Officers on scope and funding issues.

4. The debate between Councillors including on a number of amendments and at the end, the final decision.

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63 comments

  1. It couldn’t really have gone any other way but it still good news.
    Why did Grey Sayers and Mike Lee vote against approval?

    1. As I understand Mike Lee was largely responsible for the positioning of the Parnell Station (in a steep gully), as opposed to placing it at the bottom of Parnell Rise, where it would get better use. So he seems to have become the saboteur of PT, at least in this stage of his life.

    2. Because their brand is “Fearless maverick fighting for ratepayers and holding evil Council to account”. So they oppose everything.

    3. Bogle, what Matt “forgot” to mention was that Mike Lee at the same meeting got an agreement for council to request full funding from government. You know, the same government that provides full funding for motorways within Auckland, and the same government that states it wants to shift people from motorways to PT.

      Goff just wanted to ram it through on ratepayers.

      Mike Lee of course supports the CRL, indeed still supports the other two lines proposed by Len Brown in addition to the CRL, which vested interests have caused others to walk away from.

      Since Matt chose not to provide the proper context of Mike’s stance, I gather it is GA’s position that central government should not fully fund major PT projects like they do motorways.

      1. I mentioned it.
        Also, to be accurate, councillors and the mayor voted for it because it funding wasn’t being held up by it should the govt say no and it got the issue moved on.
        Basically the council will write to the govt asking for more funding. The govt will say no and council will move on with the funding options they agreed to.
        I would also note the govt and mayor have said in the past that has a payoff for council funding 50% of CRL, they’ll make some of that back up with fully funding other projects like LR.

        Personally I don’t think the govt should fully find motorways. It leads to perverse outcomes where local authorities try to get projects turned into state highways because they’re seen as free. Having some level of local contribution helps prevent them from calling for motorways everywhere when their not needed or justified

        1. I should add, we all think govt should contribute more to CRL but the reality is they have said they won’t and as I understand it, certain people within parties supported by some of Lee’s biggest advocates think Auckland should cover the full $1 billion.

          This is why it was made clear, any delay to hold up funding while they wait for a response would effectively kill the project. Mike voted against it anyway and therefore he voted against the CRL

        2. ‘Mike voted against it anyway and therefore he voted against the CRL’
          Matt, that’s a bit of a stretch, voting against the council funding an extra $500m now is sure not a vote against CRL.
          Suddenly it’s a panic now to get cost blowout funding approval else risk the whole project. Never mind the previous several years slow and slower non urgent need to get crl3 stage underway.
          Doesn’t this funding urgency seem suspiciously fabricated to scare council into unplanned spending?

        3. The difference now we’re at the pointy end of the process. They have a live offer following the tender process. They have to confirm its going ahead (which means confirming they have the money) or the contractor could walk away and use the resource for a project somewhere else in the world.
          So yes, voting against it now if voting against the CRL

        4. Is this the Mike Lee slamming website?

          Com’mon kids, just because you don’t like the guy you have to give him credit for asking questions most other councilor lack experience or wisdom to do so.

          I am pleased an elected representative asks the questions. The unelected (unelectable IMO) bureaucrats should not run the place.

        5. I don’t recall seeing an attack on his character, just his decisions.

          Conversely, do you think that he is such a sterling person the Parnell debacle should be ignored?

        6. Voting against something isn’t ‘asking the questions’.

          A number of councilors had reservations and asked the questions. They got to the understanding that we are no longer discussing whether the council funds 50 % of the project, that was discussed and agreed to years ago.

      2. Thanks Geoff, I thought there was more to Mike Lee’s reasoning and hence his vote. I suspect the vast majority of Aucklanders would support a review of how CRL is funded and that with most major transport infrastructure projects worldwide, it should be government funded. I can’t help thinking that the perceived and required urgency to get this cost blowout approved has forced AC into fast tracking acceptance of the 500m. The CRLL presentations embodied a threat that ‘sellers market’ could make contract bidders focus on other projects. This backed AC into corner to approve now.
        Maybe Mike Lee is wiser than GA give him credit for. His anti-LR stance has likely gained him no friends here.
        I find this whole rail PT transport funding model where local councils, hence their ratepayers, are expected to meet a significant proportion of capex for what are essentially strategic infrastructure, unacceptable.
        The various Waikato councils should never have been the driving force behind intercity rail transport, never should have went cap-in-hand to a government roading agency for funding and should have expected inter region transport to be fully funded as a strategic resource by the government

      3. Goff had already formally asked for more funding, and the reply was no. If you listen to the discussion around the amendment to ask Government to fund more of the CRL (in the last video starting around 1:27 onwards). Goff says:

        “I’m happy to make this formal approach on the part of council and we’ll do that immediately. But I’m being totally frank and honest with you by giving you the reply I’ve already got to a formal approach that I have made. It might make a difference, you might think, that councillors vote for this, and it’s a majority of councillors, but I don’t believe so…”

        He then pulled out two voting records of previous unanimous council decisions.

        “councillors also voted with no dissenting votes to confirm the 50% share of the budget. So therein lies our challenge. We’ve agreed to this. We can’t change it unilaterally. Can we speak out and say, “Yip, we’re going to go ahead with this but we are carrying more than our fair share”? I think we can say that and that’s the reason I would support this amendment.”

        Anyone wanting to delay the decision about funding the cost increase until after hearing the reply to such a request is simply causing delay and putting up costs.

        1. So given Mike Lee has been a councilor since Auckland Council began it would be fair to say he has voted in favour of the council paying 50 % previously.

          He’s making things easy for his critics isn’t he.

        2. Heidi, those previous unanimous council votes to fund CRL were based on the $3.4bn costs. This new situation of an extra $bn was not foreseen when council approved CRL expenditure.
          The acceptance by council of this extra $500m is simply approving of government’s policy to find someone else to fund major infrastructure – in this case ratepayers.
          My concern is what will happen when the next CRL cost blowout occurs? Will council have find another billion or two for CRL before it’s completed in 2027?

        3. 50% partners take extra costs equally. Or they run the risk of refusing to partner again. I don’t think that’d be a good outcome. I suggest you watch the videos, Bogle.

        4. Heidi, ok you’re right. I suppose I’m just concerned that experience shows these sort of big infra projects usually default to several cost blowouts over their construction lifetime.
          I’d prefer not to get one or more supplementary rates bills to cover future blowouts

  2. Great. Now let’s build the CRL and, in the meantime, think about what it might mean for our transport network more generally. I’m thinking that before 2024 we’ll need to update the New Network, especially in city centre and out west, and also revisit how we allocate space on streets in city centre.

    1. But what could they call it when the update the New Network? The didn’t really leave themselves any space with that name. A bit like the New forest or Pont Neuf or ‘modernism’.

      1. Still good for two more revisions. You can do the Newer Network, followed by the Newest Network. Then you’re stuffed.

        1. The New, New Network, brought to you by slurm.

          Out of interest, hear in London there is a New River, which is 408 years old and is not a river.

      2. Maybe follow the movie makers’ examples- New Network- the return, New Network – the buses fight back, New Network 2 this time its personal.

    2. The recently-published RPTP describes in detail what changes will be made to the New Network when (a) the CRL comes into use and (b) more significantly, when the two LR lines that are foreshadowed are constructed.

      1. Yessshhhhh it does but we now have more data on what parts of NN are working well etc. So may need to update RPTP, is what I’m suggesting.

  3. Wow so Mike Lee goes down in history as voting against the final funding approval of CRL. That’s quite a fall for the guy who used to champion rail in Aucklanc. Sad.

    1. Yes, for a guy who is so determined to create a HR “legacy” for which he will be remembered for ever he seems to be going out of his way to be a saboteur. The risk is that he will be remembered for his abrasive ness, obstinacy and short-sightedness rather than anything positive. Very sad. I voted for him (just) last time around but it will be an easy choice in 2020. Just hope that City Vision have the balls to select someone else as candidate.

      1. Pippa Coom has been selected as the city vision candidate for Waitemata. Mike didn’t seek the nomination but he hasn’t announced he’s not running so a chance he will stand as well

        1. I know Pippa and her credentials are (mostly) excellent. However I was taken aback on one occasion when in conversation she referred to the bus as the “loser cruiser”. That’s me you’re talking about, Pippa! If you want to be elected don’t refer to your potential supporters as “losers” just because they’re not quite as cycle-fanatic as you are.

      2. This is a sad ending for Mike. Once was a real champion for rail pt in Auckland but will leave with his reputation tarnished in my eyes. Yes, he’s right to be unhappy and have reservations about this but in the end he needed to do what is right to help get this project done, and that’s to vote yes. I voted for him until the last election when his opposition to the Unitary plan was too much to ignore. If he does decide to run again, he won’t be getting my vote.

    2. Your comment is based on what Matt wrote, which is out of context. It’s just the latest example of a long standing campaign against Mike Lee by this blog.

      The proper context is that Mike Lee sought (and got) an amendment for council to request the funding from the crown. The cost blowout comes from a project governed by a crown entity (CRL Ltd), and therefore Goff was seeking to have ratepayers bail out a crown entity.

      The government fully funds motorways in Auckland, and has a policy of wanting people to use those motorways less and use trains more, so fully funding the blowout makes sense on many levels.

      That’s Mike Lee’s stance.

      The fact this blog didn’t mention this was precisely to induce the sentiment you express.

      1. The people who act as an unpaid PR firm for Mike Lee, spinning the facts to suit his narrative/self-image, can’t imagine that the other side could be doing anything other than spinning against him.

      2. Nothing you have explained is new to anyone who has read this post.

        Mike is just trying to dredge up old ground, the decision was made a number of years ago to split funding for this project, if Mike has a beef it should be with the councillors who voted for it back then.

        It’s easy to grandstand when you know the other councillors are going to pass the motion anyway. It would be interesting to know if he would have had the balls to bring CRL down if his vote was a decisive one.

      3. “The cost blowout comes from a project governed by a crown entity (CRL Ltd), and therefore Goff was seeking to have ratepayers bail out a crown entity.”

        CRLL is jointly owned by govt and council. Councillors voted unanimously to equally share its costs – including any future increases.

  4. At the very least Council could align parking rates to reflect a return on the land value, then at least ratepayers wouldn’t be subsiding driving into the city centre quite so much (in contradiction to the modeshift strategy) and raise a little more income to service the debt?

    1. Lee wanted to delay the decision and get the government to pay for it all, even though he has told the govt has already said no (because council signed a deal to pay 50%), and was clearly told delaying things would basically kill the procject.

      During the debate he was effectively trying to claim CRL are hiding things because they haven’t given him enough information. Basically is his general distrust of all officials

    2. Jumping the shark is the moment when something that was once popular that no longer warrants the attention it previously received makes an attempt at publicity, which only serves to highlight its irrelevance.

      The idiom “jumping the shark” is pejorative, most commonly used in reference to unsuccessful gimmicks for promoting something. It is similar to “past its peak” but more specifically suggests an unwillingness to acknowledge the fact.

      1. Unwilling to acknowledge the fact? Perhaps you could state your real name.

        Fake name, launching a post that is nothing more than a personal attack.

        You’re a coward.

        1. I don’t normally agree with you too often Geoff. However, from what I’ve read from you today I totally agree with your posting.

          It is sad to see this website descend in one post by Matt L into a low muck raking deliberately misrepresenting Cr Lee.

          Is this Greater Whale Oil blog now?

    3. I argued a few years ago that Mike Lee’s good performance on public transport issues was while he represented the old Auckland City on the ARC, a constituency stretching from Avondale to Otahuhu. His transformation into a NIMBY curmudgeon coincides with him becoming the Councillor representing the gentrification-enriched, landlord-infested enclaves of Herne Bay, Ponsonby and Waiheke. https://fightback.org.nz/2016/10/19/aucklands-no-choice-elections-blue-greens-and-conservative-leftists/

      1. He should also be representing the residents of the city centre, but his stand on the safer speeds consultation shows he has failed to recognise their needs.

  5. It really is mental that our society stops doing public projects during a recession, so the Government can balance its books, and then we do lots of public works when the the private sector is booming and everything costs too much. I am not a Keynesian and I am not into that pump priming crap, but you would think the Government should be able to respond to price signals from the market and buy projects like a contrarian long term owner rather than exacerbating market cycles.

    1. Yes miffy it seems illogical to be building this in a construction boom – if at all. The cost is now twelve times the original cost of the AHB – up from six times – and that is getting ridiculous for the modest benefits it will deliver.

      1. I once compared the cost of the harbour bridge to the regional GDP of Auckland at the time, it was around 8%. Back in the 50s Auckland was a pretty small population with a small economy, and the harbour bridge was a very big deal for a city of that size.

        If we were to spend 8% of regional GDP (about $100b in 2018) on one project today, that would be equivalent to spending about $8 billion dollars.

        So in this measure of the ability of the regional economy to shoulder the cost of investment, the CRL is about twice as affordable for Auckland as the harbour bridge was in 1959. Of course it would have been even better if we had started three years ago.

    2. I don’t recall NZ reducing spending on transport infrastructure during the last recession. It’s been a reasonably continuous increase in transport spending since the early 2000’s.

      1. Expenditure in 2008 dropped as a % of GDP and GDP also dropped(-1.5%) giving a sharp decline for that year. https://figure.nz/chart/J4soBXRSFxV4R8pd
        The graph below shows GDP changes which shows the the big recesssion of 1991 when Govt spending was also slashed. (perhaps also is the wrong word given that GDP=Consumption+Investment+Government Spending+Net exports so Govt spending is a component of GDP.
        https://www.google.com/publicdata/explore?ds=d5bncppjof8f9_&met_y=ny_gdp_mktp_kd_zg&idim=country:NZL:AUS:FJI&hl=en&dl=en#!ctype=l&strail=false&bcs=d&nselm=h&met_y=ny_gdp_mktp_kd_zg&scale_y=lin&ind_y=false&rdim=region&idim=country:NZL:AUS&ifdim=region&tstart=578577600000&tend=1493726400000&hl=en_US&dl=en&ind=false

        1. That first graph seems to contradict both of us. Looks like infrastructure spending as a % of GDP has never been higher than in 2007 and 2009 during the GFC.

          I can’t see any evidence in this that we cut back on spending between 2007 – 09

  6. Good lord, an infrastructure project needs extra funding. The Council actually makes it happen.

    Now that the CRL costings have been updated, the Council should be asking AT to give NZTA a hurry-up on LRT. Or is this going to be another excuse for NZTA to revisit the business cases yet again?

  7. I am glad that funding has been approved. However, it is a pity that the central government is not paying more.

    I hope the Council will look at our carparks and see if we are getting the best value for money. I suspect that the downtown carpark could have a better return than now. Perhaps a residential/hotel would be a great addition on that site.

  8. Interesting turn with the carparks not being investigated for ‘outright sale’ but still ‘partnership with developers’. Need to go back and watch the debate.
    Even though asset retention is imo best, would have been interesting to get a good report on market value against the revenue they provide.

    If the parking strategies do end up with surplus off street parking (after reform of city streets takes precedence) I wonder what kind of development partnerships would be possible. That model can achieve better public outcomes than we see from asset-sale-assisted projects like the CAB and to an extent Commercial Bay.

    1. It is extremely important they keep the carparks as I park in them. I will probably never ride on the CRL (although I did once get on and electric train and ride from Newmarket to Britomart and back just to see what they were like). But more seriously perhaps they could focus on visitor parking as they were always supposed to rather than using them for commuters.

  9. There is one thing missing or am I missing the point. Would the levy on the fuel tax would have covered the $500m shortfall?

    1. Then we’d have to cut the budget for roads to pay for the things the fuel tax is paying for. And that would’ve been too good for safety, and too good for the environment.

  10. At least AC didn’t sell of the family silver to fix a hangnail not like the different Central Governments that sold off all the family silver to cure a stubbed toe , and where did all that go to ??? . was it the transport lobby which has caused all the problems around Auckland and the rest of the Country ??/

  11. What will the annual operating cost be for the CRL and who will have to pay. Who will actually own the CRL. Just looking at the Newsroom article none of the councillor seemed to know.

  12. Anyone got the direct link or time from their meeting when they debate about the car parking buildings amendment (or do they not say too much about it)?

  13. http://content.tfl.gov.uk/strategic-case-for-metroisation.pdf

    Not quite sure where to put this – Tfl have just published and it overall is about the conversion of the South London HR network to more of a metro style operation. Lots of notes for Auckland, including slide 58 onwards (about service design, dwells, ops etc) – perhaps it’s worth extrapolating for the next article on dwells and what happens when frequencies increase…

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