Collecting a region-wide public transport rate

We’re proposing changes to the way public bus services are rated for in our region. 


Currently, Waikato Regional Council only rates for public transport services in Hamilton, Thames-Coromandel, Hauraki and Matamata-Piako. 


Outside of these areas, your district council rates for these services. We then invoice each council for the funds we need to plan and operate the region’s public transport network. We are the only region in New Zealand to work in this way. It means:

  • planning, funding, and implementation of public transport services takes longer
  • additional administrative overheads are incurred
  • funding splits for services that cross jurisdiction boundaries must be agreed between councils, independently ratified and often be reviewed annually
  • there can be a lack of clarity around the precise contribution required from each council
  • a review is probably necessary whenever there’s a significant change to routes, frequencies or vehicle types that is likely to impact the total cost or distribution of costs between councils. 


In Hamilton, Thames-Coromandel, Hauraki and Matamata-Piako, 80 per cent of the rate funding required comes from direct beneficiaries – that’s properties within 800 metres of a bus stop in Hamilton and within urban areas that have a public transport service in the other districts – with 20 per cent being spread city or district-wide. 


However, in districts where the territorial authority rates for public transport and passes this funding through to Waikato Regional Council, public transport is typically funded from general rates, spreading the cost of service across all ratepayers in those districts equally, irrespective of their location. There is no impact on either levels of service or the council’s borrowing as a result of this proposal.


Proposed rating model


Our proposal involves Waikato Regional Council rating for existing public transport services in Ōtorohanga, Rotorua, South Waikato, Taupō, Waikato, Waipā and Waitomo districts from 2025/26. That’s year two of this long term plan. From then on, the district councils would no longer need to collect rates to fund public transport – so overall, this change should be cost-neutral.

 

We have assumed that NZ Transport Agency Waka Kotahi would continue to fund 51 per cent of the net cost of all public transport bus services in the region, but there is still some uncertainty regarding the total funding that will be available.

 

The total amount we would collect through rates to fund existing services is $16.021 million per annum in 2024/25.

 

We are currently considering two rating options, which we’d like your feedback on. Based on your feedback, more work will be undertaken over the next 12 months to better define the rating option and check back with you through next year’s annual plan.

 

The two key differences between the options are:


First – whether all properties in each district of the region contribute to public transport investment because of the benefits to the wider community and the environment, or whether only those with access to public transport services should contribute.


Second – whether the Hamilton Waikato Metropolitan Area (Metro area) should be treated as a distinct area instead of relying on city and district council boundaries. This would provide a way to ensure investment for implementing the public transport services envisaged in the Metro Spatial Plan’s transport programme can be collected from the area that is expected to benefit most from that programme.


In all options, the investment required is based on the cost of running the public transport services in that area. The services themselves are determined by the Waikato Regional Public Transport Plan. The choice of rating model doesn’t affect the total amount of rates collected.

1.  

Do you support Waikato Regional Council rating for public transport services across the region?

* required
2.  

If Waikato Regional Council started rating for public transport across the region, which rating option would you prefer?
See more information in the tables below.

* required

Rating options explained

OPTION 1
 (preferred option) 		OPTION 2
» 80 per cent of the funding required from rates comes from properties within 5km of a bus route.
» 20 per cent of the funding required from rates is paid by all other properties in the area.

We would define a new area which reflects the higher levels of service experienced in Hamilton, and urban areas and key corridors within the Waikato and Waipā districts.
All people within this 'metro' area will pay the same amount towards 'metro' services. This approach means those people travelling within the metro (for example, commuting from Cambridge or Tamahere into Hamilton) all pay towards public transport in the area. This reflects that:
  • the metro area generally has more bus services and higher frequency overall
  • there are existing habits of informal park and ride or drive-up and drop off
  • there are greater decongestion benefits within the metro that all users experience on key corridors.
» 80 per cent of the funding required from rates comes from properties within 800m of a bus stop.
» 20 per cent of the funding required from rates comes from properties between 800m and 5km of a bus stop.

This assumes that only people with access to public transport gain any benefit from it, and so their rates will be higher.



How the options impact rates in Ōtorohanga, Rotorua, South Waikato, Taupō, Waikato, Waipā and Waitomo

For those areas where we would be assuming responsibility for the funding of public transport services from 1 July 2025, the rating impacts are dependent on the approval of a proposed programme by NZ Transport Agency Waka Kotahi. Based on the programme that has been put forward for approval, the following rates would be assessed in 2025/26, and adjusted after that for any price changes, or new services introduced. 


Where services are provided that support inter-district public transport connections, costs for these district areas will be grouped to reflect that all of the districts benefit from the connections.


OPTION 1
METRO
(Hamilton / parts of Waipā and Waikato)		NORTH AND WEST WAIKATO
(Pōkenō and Raglan)		EAST WAIKATO
(Matamata-Piako / Hauraki / Thames-Coromandel)		SOUTH WAIKATO
(Ōtorohanga / South Waikato / Waitomo)		TAUPŌ
 Within 5kmDistrict-wideWithin 5kmDistrict-wideWithin 5kmDistrict-wideWithin 5kmDistrict-wideWithin 5kmDistrict-wide
per $100,000 CV$26.74$4.87$3.46$0.21$6.68$0.34$9.03$0.62$2.24$0.31


OPTION 2
WAIPĀWAIKATOEAST WAIKATO
(Matamata-Piako / Hauraki / Thames-Coromandel)		SOUTH WAIKATO
(Ōtorohanga / South Waikato / Waitomo)		TAUPŌ
 800m walk up5km indirect access800m walk up5km indirect access800m walk up5km indirect access800m walk up5km indirect access800m walk up5km indirect access
per $100,000 CV$27.47$2.29$42.35$3.93$16.16$1.59$18.99$2.10$3.49$0.48




LTP - Public transport metro mapLTP - Public transport district map
$ = These households receive the least benefit from public bus services, so pay the least, though they still get some social benefit.
$$ = These households pay more as they are closer to public bus services and therefore receive slightly more benefit.
$$$ = While not being as close to public bus services, these households will still benefit from decongestion and wider social benefits from greater use of public transport in the metro area.
$$$$ = These households pay the most as they are closest to lots of public bus services and receive the most decongestion and social benefit.		$$$ = These households are within 5km of a public bus route and have some social/decongestion benefit from access to public transport.
$$$$ = These households pay the most as they are within walking distance of a bus stop.



How the options impact rates for Hamilton, Hauraki, Matamata-Piako and Thames-Coromandel

Currently within these areas, 80 per cent of investment required within Hamilton comes from properties with “direct access” to public transport (that is, within 800m of a bus stop) or in Hauraki, Thames-Coromandel and Matamata-Piako within the urban areas that have a bus service.

Hamilton (rate per $100,000 capital value)Hauraki, Matamata-Piako and Thames-Coromandel (rate per $100,000 capital value)
800m walk upDistrict-wideUrban (Statistics NZ defined)District-wide
$32$6.21$9.11$0.81


OPTION 1
 (preferred option) 		OPTION 2
Under Option 1, 80 per cent of investment would come from properties within 5km, spreading the funding requirement across more properties.

Twenty (20) per cent of the funding required would still come from the wider district or metro area.

This is most similar to the existing approach in these areas, with everyone in the district or metro area contributing to public transport.		Under Option 2, 80 per cent of funding would still come from properties within 800m of a bus stop.

The 20 per cent of funding that is currently collected from the wider districts, would instead come from the area within 5km of a bus stop.

People outside of those areas would no longer contribute to public transport funding.

Modelling indicates that the rates would be significantly higher for those properties within walk-up distance of bus stops in Hauraki, Matamata-Piako and Thames-Coromandel.
Hamilton (rate per $100,000 capital value)Hauraki, Matamata-Piako and Thames-Coromandel (rate per $100,000 capital value)Hamilton (rate per $100,000 capital value)Hauraki, Matamata-Piako and Thames-Coromandel (rate per $100,000 capital value)
Within 5kmDistrict-wideWithin 5kmDistrict-wide800m walk up5km drive up800m walk up5km drive up
$26.74$4.87$6.68$0.34$31.81$6.02$16.16$1.59



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