The question worth hundreds of millions of dollars that QLDC won't answer

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It’s the biggest issue that has faced the Queenstown Lakes District in decades. If our local sewage plant in Queenstown can’t operate effectively then development will have to stop – it really is that simple.

The community may have had some sympathy for the Queenstown Lakes District Council had they come clean and declared the problem in 2021 when the regulator, the Otago Regional Council, issued their first abatement notice against QLDC for non-compliant operation of the plant.

Semi treated effluent was being discharged illegally into local protected rivers.

Mistakes happen, contractors and experts are only human and even councils are allowed to make the occasional error of judgement.

But 2021 was like a fork in the road. The QLDC could either have fronted the community and shared the problem. Or – cover the problem up.

The council chose the second option.

To be clear – and to counter deliberate misinformation being spread by our mayor, most councillors and local MP Joseph Mooney – here are the headline facts of the issue.

• The Shotover plant has suffered multiple failures around both the disposal field and the main plant, over many years.

• The disposal field has failed since it was built in 2019 – almost immediately. Poor ground conditions, poor maintenance, poor geotech studies, and poor operation all played a role – but the main cause of the total failure has been blockage caused by solid waste from the main plant.

• The design of the entire sewage plant rests on solid waste never reaching the disposal field. Technically it should not be possible – and yet that is the actual cause. Main plant failures.

• The disposal field blockage can’t be fixed – it is too far gone.

• Despite the new main sewage plant equipment and technology currently being constructed the plant still needs a working disposal field. The field does serve a definite purpose (filtering, final treatment and drainage).

• The disposal field crisis was caused by solid waste from the main plant, which is why the field (supposed to be dry gravel) is now flooded and contained within a temporary earth wall, built last year without resource consent, but now on the verge of total collapse due to poor design and pressure from the overflowing sewage. There have been three partial wall collapses already with ORC inspectors recording the toxicity of the sewage in the field as up to 9,000 times the safe or consented limits.

• The keep the sewage from overflowing the top of the temporary wall there is also a large non-consented pipe that is discharging millions of litres of partially treated effluent into the Shotover Delta public recreation reserve and into the Kawarau River. The Twin Rivers bike trail now also runs alongside new discharges that are sitting in a deep ditch just one metre from the trail. These new discharges are further undermining the base of the wall.

• After two abatement notices (2021 and 2024), and ten infringement notices, the Otago Regional Council is now using the Environment Court to issue orders that will force QLDC and contractor Veolia to confront these problems and fix the plant. Despite hiring two sets of consultants (BECA and GHD) since 2023, costing millions of dollars, the QLDC still does not have an answer or a budget to repair the plant. The cost could be anything from $100 million to a more realistic $500 million

• BECA advised in their report that a fix may not be possible due to the ground conditions, iwi consultation, our growing population, the proximity of two rivers, a variable water table and a need to fit the solution into current or future resource management consent legislation. Five years without a fully functioning plant is one of the more positive BECA forecasts.

• That’s five years with no Queenstown development – residential or commercial.

• Now, after months of investigation by Crux, and years of investigation by the Otago Regional Council, we are clear on what’s happened.

And as you will see, the next development comes down to one single question about one single financial transaction.

The next development could have extremely serious consequences for QLDC generally and CEO Mike Theelen in particular.

The basic question is this.

How did QLDC pay contractor Veolia for the earth wall or bund around the failing Shotover disposal field?

We’ve asked this question in different formats for months with no sensible or actual answer from QLDC or Veolia.

We know the wall was built by Beaver Contractors and cost up to $800,000. The work was commissioned by Veolia local manager Marcus Warren who until recently was a QLDC infrastructure manager.

Whether Mr Warren used a proper procurement process or not to hire Beaver Contractors is a relatively minor issue compared to the proverbial elephant in the room.

QLDC must have known when they approved the Veolia expenditure to build the illegal wall that it was not consented. We also know they decided not to tell the regulator the ORC.

That decision is monumental in every way. Did QLDC think that the regular visits by ORC inspectors would somehow fail to spot a two-kilometre earth wall that is 2 metres high? Or the non-permitted discharge pipe sending millions of litres of effluent into the public recreation ground and the special status protected Kawarau River?

The ORC did obviously see these works and that’s why the issue is now before the Environment Court – not for penalties but for solutions that should have happened in 2021.

The arrogance of the QLDC in not telling the ORC as regulator about something so blatant and obvious as the wall and pipe is breathtaking in itself.

But for the money that funded the wall and discharge pipe to have been paid out of the public purse from QLDC to Veolia is the key to everything. QLDC knew the move was wrong in every way – legally, morally and practically.

That’s why it is the biggest question and that’s why we should all be very concerned that QLDC won’t answer that question.

There’s a small chance that QLDC will try to throw Veolia and their own former manager Marcus warren under the bus and claim that Veolia did all of this without public money or council approval.

Either way – it will all come out in the end – it always does. There will be fireworks or blood on the walls – whichever analogy you prefer.

But it could all have been avoided if the council had just told everyone the truth back in 2021.