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The Consortium Approach

The Consortium Approach. Rates Postponement Seminars – October 2005. The Consortium Arrangements. Joint Committee Joint Sub-Committee at officer level Delegated authority to administer Management Company Scheme administration Collective arrangements (eg Counselling)

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The Consortium Approach

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  1. The Consortium Approach Rates Postponement Seminars – October 2005

  2. The Consortium Arrangements • Joint Committee • Joint Sub-Committee at officer level • Delegated authority to administer • Management Company • Scheme administration • Collective arrangements (eg Counselling) • New product development • Individual Councils do day to day administration • No CCO involved

  3. Why a Consortium? • New innovative concepts • Significant ‘capital’ investment up front • Shared thinking power • We each bring different perspectives • Access to collective resources • Sharing of workload • Sharing of costs • Expertise you might not otherwise use

  4. Why a Consortium? • Collective ‘buying’ power – important moving forward • Managing the risks • Collective Lobbying power • Wouldn’t make sense to do it alone

  5. Key Elements • Decision Facilitation • Actuarial model to assess each application • Policies • Desk files • Arrangements with Mortgagees • Insurance • Financial arrangements

  6. Decision Facilitation • Ensuring people understand what they are doing • Relationship Services • Exclusive nationwide arrangement • They have the expertise and experience • Mandatory for all applicants • Certificate provided to Councils

  7. Policies • Rating Policy • Residential properties • Individual choice on quantum postponed • Investment Management Policy • Liability Management Policy • Different to traditional security

  8. Insurance • Issues • Uninsured properties • Properties in hazard zones (80% land value) • Uninsured property risk • Group scheme being established • Compulsory for uninsured • Postpone premiums for all in the future?

  9. Financial Issues • Cashflow implications • Collective power to secure debt to manage • Talking to banks • Investment secured by statutory land charge • Can’t apply to Maori freehold land • Policy development • Liability and Investment Policy amendments

  10. Collective Lobbying Power • Ability to lobby increased • Central Government • Other stakeholders (eg Greypower) • Legislative change • Registration of one statutory land charge • Rates rebate scheme • UAGC excluded • Postponed rates treated as income?

  11. The questions we asked? • Why would we do it? • This is not our issue but one for the ratepayers themselves • Is Council taking on extra risk? • Would we have problems with ratepayers estate?

  12. Why did we get involved? • High value properties – asset rich income poor • Flood protection works – big capital cost • High proportion of elderly • Offering another payment option • Why would we not do it? • Self funding

  13. Why you should join? • Model is set-up and works • Comprehensive • Power of the consortium • Its about providing your ratepayers with a choice

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