1. Mines better than yours Local Government Property Contracting

2. Mines better than yours Local Government Property Contracting Today Introductions Background Mines better than yours Conversation Opportunities for collaboration?

3. Mines better than yours Local Government Property Contracting Introductions Ann Clark Horowhenua District Council Ken Price Kapiti Coast District Council Doug Tate Manawatu District Council

4. Mines better than yours Local Government Property Contracting Today Introductions Background Mines better than yours Conversation Opportunities for collaboration?

5. Background In 2012 $382 million spent nationally on Property Opex Value is likely to be much higher, when other services are included Government Rules of Sourcing – Recommended rules for local government – All of Government Contracts – Regional Shared Services ‘Better Local Government’ – LGA Amendment Act Mines better than yours Local Government Property Contracting

6. Background ‘Better Local Government’ – LGA Amendment Act The Amendment Act key changes: provide for greater encouragement to local authorities to collaborate and cooperate; enable the Local Government Commission to create council-controlled organisations and joint committees as part of a re-organisation scheme; provide for greater transparency, clarity and accountability in contracting for delivery of services by council-controlled organisations; broaden the scope of the triennial agreement between councils within each region; provide a clearer framework for joint committees; Section 17A Review of Service Delivery Requirement Mines better than yours Local Government Property Contracting

8. Background Operational Expenditure by Activity 30 June 2012 Source: http://www.localcouncils.govt.nz/LGIP.nsf/wpgURL/Profiles-Local-Government-Statistical-Overview-Operational-Expenditure Mines better than yours Local Government Property Contracting

9. Background Capital Expenditure by Activity 30 June 2012 Source: http://www.localcouncils.govt.nz/LGIP.nsf/wpgURL/Profiles-Local-Government-Statistical-Overview-Capital-Expenditure

10. Mines better than yours Local Government Property Contracting Today Introductions Background Mines better than yours Conversation Opportunities for collaboration?

11. Manawatu District Council Mines better than yours Local Government Property Contracting

12. Manawatu District Geographically very spread – difficult country Many assets in a range of conditions – Not high volume, but large and important Annual Property Activity Budget of $1.2 million Community Facilities Contract - 3910 – Provides some cover for afterhours Direct engagement with Plumbers, Builders, Glaziers Mines better than yours Local Government Property Contracting

13. Better? Sound understanding of what is going on Historical and long standing relationships – Existing Tacit knowledge of assets Flexibility in who can be used – Limited procurement methodology No ‘on cost’ – low cost? Local Content – What is local? – Community view that not being ‘ripped off’ Mines better than yours Local Government Property Contracting

14. Or not? Lots going on –hard managing multiple contractors Very hands on – limited resourcing What is NEC3 – new language, no one knows it Limited ability to scale up in events Procurement? Health and Safety Implications – Health and Safety Reform Bill Limited structured Asset Management Information Low cost or low value? Mines better than yours Local Government Property Contracting

15. Maybe? The future Structured approach to how services are procured and implemented – Service Review Service Contracts for some larger activities Retaining the ‘local’ content Increased Health and Safety and procurement processes Looking to other Councils locally for collaboration

16. Mines better than yours Local Government Property Contracting

17. Horowhenua District Council Mines better than yours Local Government Property Contracting

18. Horowhenua District Budget of $1.5 million Previously low levels of asset condition – Shifted to high levels of planned maintenance, unplanned low Service provider across assets – Hub for all things building across the Council, Pools to Water Plants – 115 Pensioner Housing Units, Commercial Property NEC3 Contract – New Engineering Contract 3 (Collaborative) Single large Facilities Management Contract – All services are bundled together Mines better than yours Local Government Property Contracting

19. Better? 2010 FM Contract put together – ‘De-risking’ the Property Activity, not sufficient resource Private Contractors had the knowledge of assets Allowed for significant volumes of work to be undertaken in a systematic, programmed way – Organisationally Resource Poor Provided a consistent approach to managing property assets across the District Shifted from a pattern of high risk, high cost unplanned work to a high level of planned work Mines better than yours Local Government Property Contracting

20. Or not? Shift in knowledge base back to Council FM Contractor an obstacle to resolving many issues – Unneccessary step, opportunity to remove ‘the middle man’ – Unable to deal directly with subcontractors On-cost made some project and maintenance work unviable and costly Political view of ‘Local’ Contractors – Yet over 70% of Contractor spend was local – What is ‘local’

21. Mines better than yours Local Government Property Contracting Maybe? The future Smaller function contracts – Building washdowns, cleaning, mechanical and HVAC, Fire Services Shift away from NEC3, back to traditional forms of contract Panels of preferred suppliers – Approved ‘local’ builders, plumbers and other trades Increased Resources to manage contract internally More structured approach to data and asset management – Development of Registers – Exploring RAMM for Property Contract Management

22. Mines better than yours Local Government Property Contracting

23. Kapiti Coast District Council Mines better than yours Local Government Property Contracting

24. Kapiti Coast District Council Geographically spread Four very distinct local communities with quite different characteristics and demographics Annual Property Activity budget of 2.6 million Multiple contractors, annual or 3 yearly most typical Small, focused Property resource/good control over Property portfolio Recent organisational move to Activity Plans, previously Asset Plans In-house Property Asset Management System – live asset info, very accessible and utilised daily Specialist contractors can be an issue, e.g. Lift Maintenance (Wellington-based generally) Mines better than yours Local Government Property Contracting

25. Better? A very good understanding of assets A challenge is capturing the long term needs of building occupiers (e.g. Libraries) Day to day management of Operational and Renewal work enhances asset knowledge and ensures ‘finger on pulse’ Strong long term relationships with some of contractors is a feature Don’t have eggs in one basket (cleaning example), flexibility is critical Mines better than yours Local Government Property Contracting

26. Or not? Multiple contractors are a challenge to manage when resources are limited After hours coverage is an additional pressure on internal resources

27. Mines better than yours Local Government Property Contracting Maybe? The future Regional amalgamation? Larger contracts, e.g. Security have potential to be ‘super- sized’ into a regional setup approach Central and Local Government moves towards review of assets (efficiencies) Further development of asset management practice (new asset system?), and embedding health & safety changes Earthquake strengthening works may require expertise not currently available within Kapiti (Engineering/Contractor)

28. Mines better than yours Local Government Property Contracting Today Introductions Background Mines better than yours Conversation Opportunities for collaboration?

29. Mines better than yours Local Government Property Contracting Conversation Share with each other your contracting model Better or not? Maybe? Is it working for you? Anything we can share?

30. Mines better than yours Local Government Property Contracting Conversation Better or not? Maybe?

31. Mines better than yours Local Government Property Contracting Today Introductions Background Mines better than yours Conversation Opportunities for collaboration?

32. Mines better than yours Local Government Property Contracting Opportunities for collaboration? Better or not? Maybe? S hare with each other things you may be doing now Should we be promoting anything as an industry?

33. Mines better than yours Local Government Property Contracting Opportunities for collaboration? Better or not? Maybe?

34. Mines better than yours Local Government Property Contracting Thankyou