Agenda of Extraordinary Council Meeting

Terms of reference – Council

Membership

Chairperson	Mayor Tenby Powell
Deputy chairperson	Cr Tina Salisbury
Members	Cr Jako Abrie Cr Larry Baldock Cr Kelvin Clout Cr Bill Grainger Cr Andrew Hollis Cr Heidi Hughes Cr Dawn Kiddie Cr Steve Morris Cr John Robson
Quorum	Half of the members physically present, where the number of members (including vacancies) is even; and a majority of the members physically present, where the number of members (including vacancies) is odd.
Meeting frequency	Six weekly or as required for Annual Plan, Long Term Plan and other relevant legislative requirements.

Role

· To ensure the effective and efficient governance of the City

· To enable leadership of the City including advocacy and facilitation on behalf of the community.

Scope

· Oversee the work of all committees and subcommittees.

· Exercise all non-delegable and non-delegated functions and powers of the Council.

· The powers Council is legally prohibited from delegating include:

o Power to make a rate.

o Power to make a bylaw.

o Power to borrow money, or purchase or dispose of assets, other than in accordance with the long-term plan.

o Power to adopt a long-term plan, annual plan, or annual report

o Power to appoint a chief executive.

o Power to adopt policies required to be adopted and consulted on under the Local Government Act 2002 in association with the long-term plan or developed for the purpose of the local governance statement.

o All final decisions required to be made by resolution of the territorial authority/Council pursuant to relevant legislation (for example: the approval of the City Plan or City Plan changes as per section 34A Resource Management Act 1991).

· Council has chosen not to delegate the following:

o Power to compulsorily acquire land under the Public Works Act 1981.

· Make those decisions which are required by legislation to be made by resolution of the local authority.

· Authorise all expenditure not delegated to officers, Committees or other subordinate decision-making bodies of Council.

· Make appointments of members to the CCO Boards of Directors/Trustees and representatives of Council to external organisations.

· Consider any matters referred from any of the Standing or Special Committees, Joint Committees, Chief Executive or General Managers.

Procedural matters

· Delegation of Council powers to Council’s committees and other subordinate decision-making bodies.

· Adoption of Standing Orders.

· Receipt of Joint Committee minutes.

· Approval of Special Orders.

· Employment of Chief Executive.

· Other Delegations of Council’s powers, duties and responsibilities.

Regulatory matters

Administration, monitoring and enforcement of all regulatory matters that have not otherwise been delegated or that are referred to Council for determination (by a committee, subordinate decision-making body, Chief Executive or relevant General Manager).

Emergency Council Meeting Agenda

21 August 2020

6 Business

6.1 Governance Issues and Forward Plan

File Number: A11698185

Author: Christine Jones, General Manager: Strategy & Growth

Authoriser: Marty Grenfell, Chief Executive

Purpose of the Report

1. To formally report to Council correspondence received from the Department of Internal Affairs relating to Elected Members’ performance and seek direction on the way forward.

Recommendations

That the Council:

(a) Receives report “Governance Issues and Forward Plan”.

(b) Agrees that Council initiated action to address the issue of Elected Member relationships is the most appropriate pathway.

(d) Requests the Chief Executive report back to Council as soon as practicable with draft Terms of Reference, recommended appointees, cost estimate and budget approval request.

Background

2. Recent events involving Elected Members have led to a high degree of media attention being focused on the Council, including the release of a significant volume of correspondence between members into the public realm following requests under the Local Government Official Information and Meetings Act 1987 (LGOIMA). This correspondence contained items that might generally be considered divisive and reflect adversely on both the authors and the persons who were the subject matter of some of the comments it contained.

3. This information, together with earlier media reports of tensions within the elected membership, is damaging to public confidence in Council. Equally importantly, it is acknowledged that those tensions are real, and are inhibiting the ability of Elected Members to act cooperatively, and the ability to focus on important issues, including decisions leading to the 2021/2031 Long-term Plan (LTP). Critical proposals relating to the LTP that affect the future of the city must be considered in the coming months and community consultation must occur ahead of the adoption of that Plan midway through next year.

4. This report has been prepared to enable Council to consider this matter. It has been prepared by Council staff with input by Council’s legal advisor Linda O’Reilly of Brookfields and in discussion with the Department of Internal Affairs (DIA).

Department of internal affairs

5. These matters have recently come to the attention of the Department of Internal Affairs (DIA), and doubtless have been noted by the Minister for Local Government. On 13 August 2020 the Chief Executive received a letter from the Director Ministerial Advice, Monitoring and Operations, DIA, referring to “concerns raised through recent media articles and correspondence received by us regarding significant conflict among elected representatives” (Attachment 1). The letter was circulated to Elected Members on 14 August 2020.

6. The letter seeks further information from Council and requires “assurance and evidence” of the Council’s proactive steps to “restore trust and confidence in its ability to meet the Crown’s expectations of a high-performing Council”. Although not stated to be a Ministerial request for information pursuant to Part 10 (Ministerial powers of assistance and intervention) of the Local Government Act 2002 (LGA), it may be regarded as such.

7. The letter from DIA specifically requests:

· An independent evaluation of the current standard of governance performance by Elected Members against the expectations set out in the Code of Conduct;

· A summary of the key issues that Elected Members agree are impacting the Council’s performance;

· A clear plan on how the Council will address the issues, including a timeline and framework for how success will be measured;

· A summary of key decisions that the Council needs to make through to 30 June 2021 to deliver the 2021-2031 Long Term Plan and SmartGrowth objectives.

Considerations in determining pathway forward

8. It is appropriate for Council to consider the matters raised in the letter from DIA, particularly the framework pursuant to Part 10 of the LGA which would potentially be applicable.

9. Part 10 of the LGA provides the Minister with a range of options in relation to a local authority that has a problem. The options vary according to the nature and scale of assistance required to address the problem. The LGA defines a problem as “a matter or circumstance relating to the management or governance of the local authority that detracts from, or is likely to detract from, its ability to give effect to the purpose of local government within its district or region”, and includes “a potential problem”.[1]

10. The options available to the Minister under the LGA are:

(a) Requiring of information where the Local Authority has not publicly acknowledged the nature and extent of the problem or may be unable or unwilling to effectively address the problem.

(b) Appoint a Crown Review Team with power to investigate, review and recommend to the Minister.

(d) Appoint a Crown Manager with power to direct the local authority to act and recommend to the Minister.

(e) Appoint a Commission (where a Crown Review Team, Crown Observer or Crown Manager is unlikely to address this issue).

11. The Minister may appoint a Crown Review Team if:

(a) the local authority has received a notice from the Minister under section 257(1) and, for no good reason, has not provided the information required by the notice by the stated or agreed date; or

(b) the Minister believes, on reasonable grounds, that a significant problem relating to the local authority may exist and the local authority is unable or unwilling to effectively address the problem; or

12. The Minister may appoint a Crown Observer to a local authority if:

(a) the Minister believes, on reasonable grounds, that a significant problem relating to the local authority exists and:

(i) the appointment of a Crown Observer is necessary to enable, or better enable, the local authority to effectively address the problem; or

(ii) the appointment of a Crown Observer is necessary to enable, or better enable, the Minister to monitor the local authority’s progress in addressing the problem; or

(iii) a Ministerial body currently or previously appointed to the local authority has recommended the appointment; or

(b) The Minister has received a written request from the local authority to do so.

13. The Minister may appoint a Crown Manager if:

(a) the Minister believes, on reasonable grounds, that a significant problem relating to the local authority exists, and:

(i) the nature or extent of the problem is such that the local authority is unlikely to effectively address the problem without the appointment of a Crown Manager; or

(ii) for no good reason, the local authority has not adequately implemented a recommendation of any other Ministerial body in relation to the problem; or

(iii) a Ministerial body currently or previously appointed to the local authority has recommended the appointment; or

(b) the Minister has received a written request from the local authority to do so.

14. The Minister may appoint a Commission to a local authority if:

(a) the Minister believes, on reasonable grounds, that:

(i) a significant problem relating to the local authority is:

· impairing, or likely to impair, the good local government of the local authority’s district or region; or

· endangering, or likely to endanger, the public health or safety of the people within the local authority’s district or region; and

(ii) the local authority is unable or unwilling to effectively address the problem; and

(iii) the problem is such that appointing a Crown Review Team, a Crown Observer, or a Crown Manager to the local authority is unlikely to prevent the consequences described in subparagraph (i); or

(b) the local authority refuses or is unable to comply with a direction of a Crown Manager; or

(c) the Minister believes, on reasonable grounds, that a significant problem relating to the local authority exists and a Ministerial body currently or previously appointed to the local authority has recommended the appointment; or

(d) the Minister has received a written request from the local authority to do so.

15. There are some differences in the roles of a Crown Review Team and a Crown Observer. Pursuant to section 258(4) a Crown Review Team must:

(a) investigate and report on the nature and extent of the problem; and

(b) make recommendations to the local authority and the Minister on how the local authority could address the problem; and

(c) make recommendations to the Minister on whether the Minister should take further action in relation to the local authority, including whether the Minister should appoint any other Ministerial body to the local authority; and

(d) ensure, as far as practicable, that the existing organisational capability of the local authority is not diminished.

16. A Crown Observer must:

(a) assist the local authority to address the problem; and

(b) monitor the local authority’s progress in relation to the problem; and

(d) ensure, as far as practicable, that the existing organisational capability of the local authority is not diminished.

17. The Minister has Gazetted a “Notice Regarding Ministerial Powers of Local Government Assistance and Intervention” pursuant to section 258O of the LGA. It states that in making decisions under Part 10 of the LGA the Minister is to be informed by the purpose of local government and the role of, and principles relating to, local authorities in Subparts 1 and 2 of Part 2 of the LGA. The purpose of local government, as set out in section 10 of the LGA is to:

(a) Enable democratic local decision-making and action by, and on behalf of, communities; and

(b) Promote the social, economic, environmental, and cultural well-being of communities in the present and for the future.

18. In determining whether intervention is required the Minister is to have regard to matters or circumstances that the Minister considers are likely to detract from the ability of the Council to give effect to the purpose of local government. One of the matters likely to detract from that purpose is “dysfunctional governance” including “failure or breakdown of key relationships”[2].

19. Also relevant to Council’s consideration is whether there may be a negative impact on Council’s relationship and standing with central government, including potentially jeopardising post COVID funding arrangements.

Problem Statement

20. The problem that the Council could address is that of dysfunctional governance arising from the failure or breakdown of key relationships. Those key relationships include those between the Mayor and councillors and between councillors or factions of councillors. There is evidence, in terms of the recent events relating to the role of deputy mayor, that the relationships between the Mayor and councillors, and between factions of councillors, are dysfunctional. The willingness of certain Elected Members (including the Mayor) to work cooperatively with each other has been demonstrated publicly to be strained.

21. The relationship issues are evidenced by the communications between Elected Members concerning the position of deputy mayor that were released to the media pursuant to a LGOIMA request, and that demonstrate relationship stresses within that group. It is also evidenced by the continued focus of the media on the performance of Elected Members (most recently a request for details of elected member education on local government).

22. The Elected Member relationship issues are mainly manifesting in forums outside the council chambers, with the formal decision-making processes of Council not significantly impacted at this stage.

23. While the Elected Member relationship issues impact on the efficiency of the Executive Team, there continues to be a strong and effective working relationship between the Elected Members and the executive leadership of Council. It is considered that the organisation has strong leadership and capability and is focused on getting on with the job of running the city, planning for its future and dealing with the pressures created by COVID-19 and our rapid growth.

24. There is evidence that confidence in the Council is at a low level. The Community Perceptions Monitor Study survey measures the perceptions of residents regarding various aspects of services that Council provides. The study has been undertaken since 2006, with the current results recently released for the year ending June 2020. Residents’ perceptions of Council’s performance have been declining in the last 24 months. TCC’s reputation is considered ‘poor’ against the reputation benchmark with an overall reputation score of 37% based on four categories – Financial Management (28%), Leadership (42%), Faith & Trust in Council (34%) and Quality of Services and Facilities (53%).

25. Ask your Team was the name of the 2020 Culture & Engagement Survey that staff completed in July 2020 that set a benchmark for how staff feel about Council as a place to work. Staff were asked a number of questions relating to culture, suppliers, information, leadership, learning, performance development, strategy and rate payer/community focus among others. Amongst the questions that scored the lowest across the survey, the following two questions were in the bottom three:

· Our Council has a positive reputation in its local business community (46%); and

· Our Council has a positive reputation with our ratepayers (37%).

26. This illustrates a serious risk of affecting the Council’s ability to deliver timely, sound, and democratic local decision-making and action for its communities and to promote the social, economic, environmental, and cultural well-being of those communities. It is eroding community trust in the Council and adversely impacting on reputation.

Options Analysis

27. There are 3 broad option pathways that the Council could choose, being to:

(a) Take no action in response to the letter from DIA.

(b) Initiate by Council resolution action to address the problem.

Option 1: Take No Action

28. The “Take No Action’ option would be a deliberative decision not to respond to the DIA request (as outlined in paragraph 7 of this report). It would result in the Chief Executive writing to the DIA advising that the Elected Members had not agreed on a clear plan and that no Council instigated independent evaluation would occur.

29. The disadvantage of this option is that Council would likely be seen as unwilling to address relationship problems and to improve the decision-making environment which has developed this triennium. This has the risk of the Minister concluding under S257(1)(b)(ii) that the Council is “unable or unwilling to effectively address the problem”.

30. This option has the risk that the Minister may appoint a Crown Manager or Commission. The appointment of a Crown Manager will reduce the autonomy of Council with a statutory requirement for the local authority to “comply with the directions of a Crown Manager”. Where a Commission is appointed the decision-making powers of Elected Members are removed as members will not be entitled to act (or to be paid any remuneration).

Option 2: Initiate by Council Resolution Action to Address the Problem

31. This option would be Council initiating an action to proactively address the situation.

32. The advantages of this option are that it:

· Enables the Mayor and Councillors to have a high degree of control and to design a process which is agreed by majority to be appropriate in the circumstances.

· Reduces the likelihood of direct Ministerial intervention under Part 10 of the LGA.

33. While this option could take a number of forms, it is suggested that Council appoint a Review and Observer Team. This would be analogous to the arrangements that the Minister could instigate under the LGA.

34. It is suggested that the Council appointed Review and Observer Team would be:

(a) A minimum of two and maximum of three persons;

(b) Made up of individuals with appropriate skills and experience in the local government sector and governance;

(c) Appointed for an initial term through to 30 June 2021, with a review at or around 31 March 2021 as to the appropriateness of extending beyond 30 June 2021;

(d) Focused on support, monitoring and reporting on progress in restoring the strong unified leadership needed to advance the city’s interest.

Option 3: Request the Minister to take action under the Local Government Act 2002

35. This option would be a formal Council resolution under Section 258(1)(b) of the LGA requesting appointment of a Crown Review Team, or under section 258B(1)(b) requesting the appointment of a Crown Observer.

36. The Minister would be required to take into account the matters outlined in paragraphs 9 to 14 of this report in deciding whether to make such an appointment. The decision would be ultimately up to the Minister as to whether a Crown Review Team or a Crown Observer would be appointed and also the content of the associated Terms of Reference.

37. The advantage of this option is that it removes Elected Members from the process and introduces an entirely independent approach to the problem.

38. The disadvantage is that Elected Members have significantly less opportunity to contribute to and influence the approach.

39. This option has the risk that the Minister may appoint a Crown Manager or Commission. As noted in paragraph 30 this has implications for elected member autonomy and decision making.

Recommended Option

40. Option 2 is the Recommended Option.

Financial Considerations

41. Depending on the option which is selected the financial considerations will vary. There have been external costs incurred by way of legal fees associated with this issue. The appointment of any independent evaluator/s or Review and Observer Team will have associated costs. It is proposed to estimate these future costs in ‘Next Steps’ (refer paragraph 43).

Significance

42. It is assessed that this matter is of medium significance. It is considered that community engagement on this matter and associated options is not appropriate.

Next Steps

43. If Option 2 is approved as recommended, it is intended that the Chief Executive report back to Council within two weeks on the following matters:

· Draft Terms of Reference for the Review and Observer Team

· Recommended members for the Review and Observer Team (in consultation with DIA)

· Cost estimate and budget approval request for action implementation

· Summary of key Council decisions through to 30 June 2021 to deliver the LTP and on SmartGrowth objectives (for subsequent submission to DIA).

Attachments

1. DIA Letter to Tauranga City Council - A11704099 ⇩

[2] Source – Clause (b) of Gazette Notice Regarding Ministerial Powers of Local Government Assistance and Intervention


AGENDA Emergency Council Meeting Friday, 21 August 2020
I hereby give notice that an Emergency Meeting of Council will be held on:
Date:	Friday, 21 August 2020
Time:	9.30am
Location:	Tauranga City Council Council Chambers 91 Willow Street Tauranga
Please note that this meeting will be livestreamed and the recording will be publicly available on Tauranga City Council's website: www.tauranga.govt.nz.
Marty Grenfell Chief Executive