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Waitakere City Council has apologised to a home builder for forcing him to pay $10,000 toward providing stormwater drainage to neighbouring upstream properties.
The apology and refund of $10,666 come after council disputes resolution manager Roger Wilson investigated a complaint from Nahid Ali of unfair treatment.
Mr Ali received engineering approval for his drainage system and resource consent last August based on the council's wish for his pipe to be extended to carry stormwater from an upstream property at the rear.
But in October a council official told him he would be in breach of his resource consent if he did not provide an additional connection to carry stormwater for another upstream property.
The official implied that the engineering approval already obtained could no longer be relied upon. That was not the case. Now, the council has apologised for the official not clearly stating all options open to Mr Ali, who felt obliged to have the work done but then disputed how the drainage costs were split.
In his decision, Mr Wilson ruled the property owner had a legitimate complaint about the council EcoWater division's "take it or leave it" offer during negotiations.
He said the council's offer should fairly reflect the value it gained from the public drainage works.
The outcome should also be negotiated, rather than imposed.
The council had offered to pay half of the construction costs only of the drain lines connecting Mr Ali's house with three others, and all the construction costs for linking with a further property.
Other developers were offered similar deals when providing services where the benefit extended beyond a single property, said Mr Wilson.
But he was also aware of a major development where the council had also shared the design, consent and supervision costs, so the council's approach was not consistently applied.
EcoWater argued it had little control over design and supervision processes. If it paid for these, the costs might be manipulated by an unscrupulous developer - to the council's detriment.
But Mr Wilson said that approach guaranteed developers would carry some of the real costs of undertaking public stormwater work on council's behalf to outside properties.
"The public requires a system that is fair and the council must find ways of overcoming any difficulties in order to create a system that is fair."
He said the council ought to have been prepared to consider paying a proportion of the full costs of the stormwater system, without forcing Mr Ali to apply for an extension to the line.
A council spokesman said recommendations made by Mr Wilson for changing its approach to paying recompense would be taken up.
