Mayor Nadine Taylor has welcomed the Government’s announcement on procuring two new ferries to replace the current Interislander fleet.
Mayor Taylor said Marlborough District Council had consistently made representation to Government of the need to invest in the safety and reliability of this critical national transport connection for the long term.
“Keeping our interisland connection is vital, not only for commerce but to keep our people connected too. Cook Strait is part of State Highway 1 and the Main Trunk Line, linking road and rail networks between the north and south islands. New efficient vessels are critical to keeping New Zealand’s economy moving.”
Marlborough as a region remained as committed today as it was then to supporting this key link in our national infrastructure.
“We look forward to working with the new Schedule 4A company, Government, Port Marlborough and NZTA to understand the new port infrastructure and roading requirements and associated costs,” Mayor Taylor said.
“Council and Port Marlborough can now begin investigative work on portside infrastructure design and costings and commence negotiations again on its commercial viability,” Mayor Nadine Taylor said.
Port Marlborough is owned by MDC Holdings Ltd (MDCH), which is owned by Marlborough District Council. Annual dividends from the Port flow through to the Council via MDCH as income, lowering the rating requirement for ratepayers.
Port Marlborough approached the Council through MDCH to support its share of the original iReX Ferry Precinct Redevelopment. The Council proposed raising up to $110 million in debt at a low rate that it would have on-lent to the Port for its share of the redevelopment. There was no cost to ratepayers and no increase in rates from this transaction. It went through a public consultation process in early 2022.
The Council can raise money through the New Zealand Local Government Funding Agency (LGFA), which specialises in financing the local government sector. The LGFA was created to provide lower costs and alternative funding sources for local authorities and council-controlled organisations and can raise debt on Council’s behalf on terms that are more favourable than raising the debt directly.
“Last week S&P Global confirmed Council had retained its ‘AA’ long term credit rating.”
S&P Global said: “We view Marlborough's financial management as a key strength underpinning its ratings. The council has historically recorded strong fiscal outcomes and has one of the lowest gross-debt to operating revenue ratios of all New Zealand councils rated by S&P Global Ratings.”
“Council will now need to assess the new commercial proposal as it makes decisions around the necessity of any further consultation for financing,” Mayor Taylor said.
“Council does have the debt headroom to enable borrowing to be sourced through the LGFA and on loaned to Port Marlborough but the dollars and cents must make sense for all parties.”
