Dunedin ratepayers win battle to keep Aurora under council ownership

The message from Dunedin residents was loud, the message was clear, the message was overwhelmingly  “Aurora is ours” - and is not for sale.

The message was heard well by the majority of city councillors, who today voted 13 to 2 to support the majority opinion of public submitters to retain ownership of profitable but debt-laden electricity distribution company Aurora.

They did so, knowing full well the decision, as one councillor noted, will have ramifications “for generations to come”.

The lines company is wholly owned by DCC’s commercial entity Dunedin City Holdings Limited (DCHL) and was being considered for sale to help the council offset an estimated 4.5 percent of its rates intake.

“We asked our DCHL directors to improve the level of return from our council controlled entities and produce better dividend for us to offset rates, and they have done that,” Mayor Jules Radich said.

Their plan to sell Aurora would raise income, slash debt and reduce risk, Mayor Radich said.

He also pointed out that DCHL group debt could be as high as $2.9 billion by 2032 but selling the lines company to establish an investment fund would return cash dividends and continue to grow every year.

“However, 80 percent of consultation submitters opposed the sale, and most of those were for strategic reasons.

“I have personally offered some people the choice - keep Aurora and have higher rates rises or sell and have less debt, less rates and less risk, an most chose higher rates rises.”

Mayor Radich said he would “keep faith with those ratepayers.

“Ultimately, they are the owners. We do not have a mandate to dispose of their asset. Perhaps in the future that might change, but not today.”

Other councillors, by and large supported that equivocation, even noting there would be financial impacts for ratepayers.

“Throughout the submission process the standout sentiment was Aurora is ours.”

There was also a view that utilities should not be sold.

Both those sentiments were made “loud and clear”.

However, while he disagreed with that logic, noting the council had little say in how the heavily-regulated company was run, he would vote to retain ownership “under sufferance”.

“The people have spoken and I will support their view not to sell, simply because the numbers are overwhelming.”

Other councillors said it was a “no-brainer” to retain the city’s “golden egg”, and reflected “democracy at work”.

Councillor Lee Vandervis opposed the decision, labelling it an act of  “shameful blindness”.

A sale was needed to offset “unaffordable” rate rises.

“Because we can’t afford to fund it, Aurora is a liability for the short and medium term and who knows, for the long-term.

“Our populist decision today …. is the wrong decision that will result in massive increases in debt, increasing rates and pain for the ratepayers.”

Deputy Mayor Cherry Lucas also opposed the decision.

“By 2034 rates could easily have doubled, the people I am listening to do not want that.

“Aurora is a good business …. Next year we have to produce a nine year LTP and without selling Aurora the rate increases will be untenable for the people of Dunedin, that’s finance 101.”

Main Image: Supporters celebrate the decision to retain the council's Aurora ownership at today's meeting