Foreshore Bill puts Viaduct Basin in limbo

By KEVIN TAYLOR

The Foreshore and Seabed Bill jeopardises investments worth tens of millions on reclaimed land at Auckland's Viaduct Basin, airport and port, city leaders say.

Auckland Mayor John Banks attacked the bill yesterday as a "constitutional outrage" and said the offending clause must be dropped.

Clause 100 stops the Conservation Minister vesting ownership of reclaimed land to anyone, as well as limiting leases to 50 years. The provisions apply retrospectively to 1991, when the Resource Management Act was passed.

The Auckland City Council, America's Cup Village Ltd, Ports of Auckland and Auckland International Airport Ltd have slammed the clause in submissions to a parliamentary committee.

National MP Nick Smith said the clause showed Labour was poised to break a contract he signed as Conservation Minister with American's Cup Village over 1.27ha of reclaimed land at the basin.

In 1997 the company was granted a 99-year lease with a commitment that freehold title would be granted following settlement of iwi claims.

If the bill remains unchanged it will cut the lease period to 50 years and no freehold title will be given.

The company's submission said $66 million had been spent on America's Cup facilities by it and Auckland Regional Services Trust, but the investment would never have gone ahead had the deal not been made.

Mr Banks said ratepayers had invested $45 million in the basin and the Government was pulling the rug from under the council, which seemed at the least "immoral" and at worst a "constitutional outrage".

The Ports of Auckland submission said the clause would undermine a binding legal agreement it made with the Crown over a $100 million reclamation project to extend the Fergusson container terminal.

The port got consent in 1998 and the 10ha reclamation will be completed in 2016.

Under the agreement the port gave Pollen Island in the upper Waitemata Harbour to the Department of Conservation in exchange for the Crown vesting ownership of the reclamation area in the port.

The submission said the port had taken an investment decision on the basis of the agreement, only to now face it being undermined.

The airport company submission said the reclamation of 29ha west of the international terminal between 1993 and 1998 was done to accommodate future expansion.

The company applied in 1999 to the Conservation Minister for the land to be vested in it, but was still awaiting a decision.

"The fact that AIAL was likely, eventually, to obtain freehold title to the reclamation was a major factor in it deciding to proceed," the submission said.

The office of Acting Prime Minister Michael Cullen referred the Weekend Herald to Labour MP Russell Fairbrother, chairman of the select committee considering the bill. He said submissions on clause 100 would be given serious consideration.

"I think there are some legitimate issues around the question of reclamations, and that's exactly what the select committee is convened to look at," Mr Fairbrother said.

Dr Smith said: "It is extremely serious that this is being done retrospectively. Major companies have made investments on the basis of a set of rules and now the Government is changing those rules."

CLAUSE 100

In its present form, this clause in the Foreshore and Seabed Bill would:

* Stop Minister of Conservation vesting ownership of reclaimed land in anyone.

* Limit lease arrangements to 50 years.

* Apply from 1991.

AFFECTED INVESTMENTS

* Ports of Auckland

Land swap with the Crown would see 10ha of land vested in the port company, to extend the Fergusson container terminal. The port got consent in 1998 and the project will be completed in 2016.

Investment: More than $100 million.

* Viaduct Basin

America's Cup Village Ltd and then Conservation Minister Nick Smith agreed in 1997 to a 99-year lease, followed by vesting of ownership, of reclaimed land in the Viaduct Basin.

Investment: $66 million (ACVL), $45 million (Auckland City).

* Auckland International Airport

Consent granted in 1993 for 29ha of reclamation west of the international terminal, with the job finished in 1998. Application made in 1999 to Conservation Minister to vest the area in the airport, but is yet to be granted.

Investment: $18 million.