Wellington City Council’s downtown targeted rate will generate $17.6 million in the current financial year from 3065 properties.
The Herald can reveal $3.9m of that will be spent on Tākina – the city’s new convention and exhibition centre.
Wellington Chamber of Commerce and Business Central chief executive Simon Arcus said the levy’s initial purpose was to subsidise free parking in the city and promotional days for businesses.
He said the levy has since become a default fund heavily weighted towards the arts and is now being used to “prop up” Tākina.
“Tākina is supposed to attract activity in the city to make these vibrant businesses, and instead the businesses are funnelling money into it to keep it on its feet.”
A map of the properties captured by Wellington City Council's downtown levy. Photo / WCC
The council maintains Tākina has had a successful first year after hosting more than 120 events and contributing $43m to Wellington’s economy. It was always intended that Tākina’s net operational costs would be met by ratepayers through the levy, 40%, and general rates, 60%.
Wellington Mayor Tory Whanau said the downtown levy was good value for money, from the information she has received.
However, due to the economic climate, Whanau was open to reviewing how the money was spent and that businesses paying the levy are part of the conversation.
“The best place to do that is through the upcoming Annual Plan, and I am happy to discuss this more with both the Mayoral Business Group and Chamber of Commerce,” Whanau said.
“Can anyone seriously say it was the right financial decision or the highest priority for Wellington, given all of its challenges?” Luxon said.
A recent report revealed the convention centre is not performing as well as was hoped, partly due to a decline in Government events in the capital. Tākina’s net position was last reported as being down $1.2m compared with the budget. Some people have criticised it as a white elephant.
Prime Minister Christopher Luxon blasted the $180m building at the Local Government New Zealand Conference last week. Photo / Mark Mitchell
As for the remaining money in the levy, $8.7m is for WellingtonNZ and Venues Wellington, $2.8m for galleries and museums, and $2.2m for visitor attractions like Te Papa and the Carter Observatory.
The cost breakdown was released to the Herald under the Local Government Official Information and Meetings Act.
Arcus said the levy was not being spent on promoting business.
“Over time, it has clearly become convenient to dip into,” he said.
Wellington City Council chief economic and engagement officer Anna Calver said there was a support service for disrupted businesses that included a dedicated manager offering things like free expert advice in one-on-one coaching and workshops.
Compensation was not possible, Calver said.
“Any use of the downtown targeted rate must be in line with the purpose of the council’s revenue and financing policy and benefit commercial ratepayers within the central city by driving visitation and economic activity via marketing and events, retail and tourism activities.”
This policy is reviewed every three years and in some cases amended, meaning over time, there have been changes to what the levy has funded, Calver said.
The economic impacts of the activities funded by the levy were regularly measured to ensure they were benefitting local businesses, she said.
Wellington City Council voted to end free weekend parking in the city in 2018.
“Wellington’s central city has changed considerably since those days of free weekend parking,” Calver said.
“The city has an established visitor economy, there are now more than 20,000 people living in the central city and the city has a well-used public transport service.”
Georgina Campbell is a Wellington-based reporter who has a particular interest in local government, transport, and seismic issues. She joined the Herald in 2019 after working as a broadcast journalist.
