During a workshop following the inaugural council meeting in late October, a request was made for staff to present advice on options available to councillors to commission a review of a number of the scheme's key elements.
These included aspects of the business case, the operation of the scheme's resource consents, and an assessment of impacts on land users in the catchment and the council in implementing plan change six in the absence of the scheme.
"A decision to either proceed or withdraw from the scheme requires careful consideration of a number of interdependent matters," the paper states.
Some of the issues identified by councillors for review had already been canvassed, and it could be "reasonably simple" to update this. In other areas, further work would need to be undertaken - including by independent parties.
It was proposed staff report back to council at their meeting on November 30.
The paper stated a review could be completed by the end of February, reported to council in March.
It also recommends council consult the HBRIC board of directors on issues stemming from any direction to suspend all expenditure and work relating to the scheme, by way of a resolution to modify the company's Statement of Intent (SOI).
During October's workshop, councillors had sought advice on options to provide this direction to the board during the period the review would be undertaken.
Staff understood HBRIC had a number of obligations which could be implicated if new direction was given to them from council that was contrary to existing direction under their statement of intent.
Their SOI includes targeting potential investments in water storage.
As the details of HBRIC's obligations, and implications were unknown to staff, it was recommended the council consult with the company's board on Wednesday to understand their view of the options available, and the nature of commitments they felt HBRIC needed to fill.
If council did wish to provide further direction by way of a resolution to modify the SOI, the paper recommended councillors seek independent legal advice on the implications of this.
Depending on the board's views revealed on Wednesday, it was possible any direction from council could be at odds with the boards responsibilities under the Companies Act 1993.
"In these circumstances the relationship between the Local Government and Companies acts may require expert legal review."
The review would have financial and resource implications for council staff, who would be required to de-prioritise existing work programmes - with potential consequences for their delivery.
Unbudgeted expenditure would also be required to procure external legal, commercial, and technical advice. There could also be financial implications for HBRIC if any modification to their SOI by council resolution were to occur.
-Wednesday's meeting will be held at 9am, in the Hawke's Bay Regional Council chamber.