KEY POINTS:
With foreign investors ready and willing to buy shares in Auckland International Airport, local councils stand poised for a potential windfall if they sell ... with "if" being the operative word.
At first glance, the estimated $591 million Auckland City Council could reap if it sold its 155 million airport shares and the $443 million Manukau City Council might earn would seem to go a long way to answering the need for cash to fund infrastructure demands for two rapidly expanding cities.
However, Manukau Mayor Sir Barry Curtis is adamant that his council should retain its shareholding in the airport - which has earned the city $108 million in dividends and payments in the past nine years - calling it a great investment.
Auckland City says its decision will have to factor in the council's long-term objectives, as well as the community and the broader public interest.
The councils stress that no decision has yet been made about the sale of airport shares, and say they will abide by the Local Government Act, which requires councils to consult the public if it proposes to change its long-term plan or change significant assets.
Manukau City will call for public submissions in mid-September, just before October's local body elections, and the newly elected council will consider the submissions and make a decision in early November.
Auckland has asked its ratepayers for their views on a sale, with an August 15 deadline for submissions.
An Auckland City Council spokeswoman said it was premature to discuss the issue prior to the council completing the public consultation process and evaluating its options - including doing nothing.
A Manukau City spokeswoman said discussing what any proceeds could be spent on was premature speculation.
However, each council's planning documents do set out a range of capital expenditure plans which could be partially funded from a share sell-off.
Auckland City's long-term plan includes proposals to spend $56 million improving public access to the harbours, $340 million to develop the CBD waterfront, $134 million on reviving the heart of Auckland, $20.5 million for new swimming pools in Avondale and Otahuhu, an $800 million investment in roading, $83 million in footpaths, and $44 million in stormwater systems.
The council's consultation document says if the shares were sold to fund capital investment in place of borrowing, the savings in interest costs would significantly exceed the value of dividends the council currently receives from the airport.
However, it also says options other than selling the shares might realise similar financial benefits over the medium to longer term.
Manukau City's long-term plan includes a proposed rail link to Manukau City centre, a new ferry terminal at Half Moon Bay, bus lanes, roading projects including a link from East Tamaki to the Southern Motorway and an eastern corridor route to the CBD, developing Barry Curtis Park, and a range of water, wastewater and stormwater projects.
All worthy projects, but with a Herald-DigiPoll survey of 400 Auckland city ratepayers this week showing 80.9 per cent opposed to the council selling its airport shares - and elections due in October - public opinion may well have the final say.
Auckland City councillor Doug Armstrong said proceeds from any sale should not be squandered and kept for "family silver-type things".
Mr Armstrong said he was personally quite keen on seeing the development of a second airport at Whenuapai, saying it could be a worthwhile investment with any proceeds from the sale of Auckland airport shares.
