Port Marlborough loan plan authorised

Port Marlborough will get a $531 million facelift after Council authorised a loan for the local share, $110 million, at a special meeting Tuesday morning in chambers.

Councillors sought reassurances about repayment of the financed figure as well as opportunities for them and future counterparts for fiscal oversight. Their unanimous decision followed 100 minutes of deliberation with a singular member of the public in the gallery.

The loan approval buoyed a project which ebbed and flowed over eight years. Notably, port renovations that were moving forward under the auspices of iReX (Inter-island Resilient Connection) got cancelled by Central Government in 2023.

Since iReX, Government changed the programme bringing two new ferries to the Picton-to-Wellington route – larger vessels requiring renovations of scale.

“I understand the people of Marlborough may feel like they’ve been through death by consultation,” Mayor Nadine Taylor observed. “But this is a new project.”

Council put the matter to Marlburians during a consultation period which included three public meetings and two hearings. Among the 73 submissions received, 60 favoured Option 1 (Council lending the money to the port) and 13 favoured Option 2 (not doing so).

Exemplifying comments in support: “Ratepayers will not only not have to bear any costs of this loan, but will receive enhanced dividends from Port Marlborough through direct increased revenue generated by the ferry operations. In addition, the increased and ongoing economic benefits to Picton and all of Marlborough will create more jobs and increase economic benefit to the region. All in all, this is an absolute no brainer.”

Exemplifying comments opposed: “Central Government should be the one to pay for and put in place somewhere to park its ferries – not the ratepayers of Marlborough.”

Wairau-Awatere Councillor Gerald Hope, expressing affirmation by the ratio of support in submissions, remarked: “I think this would be the most rigorous process that Council has undertaken. Nothing is risk-free,” he added, “but I would put 98- to 99 percent on this.”

Discussion points

After a half-hour of public-excluded updates on what the mayor called “commercially sensitive information”, councillors (with Māori Ward’s Allanah Burgess online) reconvened publicly. The mayor teed off discussion by noting the Waitohi Ferry Redevelopment Project is “a significant investment” in the port which, she stressed, Marlborough owns.

Geoff Blake, Council’s chief financial officer, summarised that the loan from the Local Government Funding Agency, backed by commercial agreements and securities, would provide a “risk-appropriate financial return”.

Port CEO Rhys Welbourn delineated the contractual obligations for Ferry Holdings Ltd (Government's company) and for the port – the latter retaining “full operational control and the right to collect inter-island revenues” on the Picton side – and reiterated that ratepayers bear no cost. On timing the project’s completion, he said, “the stars are aligning for 2029.”

As the meeting incorporated a hearing, councillors reviewed submissions, which a circulated document encapsulated. The CFO noted the majority of supportive positions but also acknowledged concerns regarding risks, uncertainties and the loan’s structure.

“We have taken those into account,” he said, “and we will be working with the port” to address points raised.

Blenheim Councillor Cyril Dawson consolidated positive feedback: “All the i’s are dotted and t’s are crossed – I’m all for this.”

Wairau-Awatere Councillor Scott Adams joined Blenheim Councillor Brian Dawson in scrutinising the financing. Given the loan’s amortisation, they sought – and received – assurance that Council could review how the port allocated revenue toward repayment.

At Adams’ request, councillors considered approvals in multiple blocs. The mayor made two companion motions to accept Option 1, which Deputy Mayor David Croad seconded, and the voting proceeded without  further discussion.

Separately, Adams moved to thank and notify commenters of the decision; Blenheim Councillor Deborah Dalliessi seconded, and its passage capped the proceedings.