The Tauranga subdivision needs $400 million roads. Who will pay for it?

Tauranga City Council could face a “substantial funding gap” for new roads aimed at opening up much-needed housing in the city’s east.

The roads are key routes for Te Tumu, on the eastern side of Pāpāmoa, which will be home to 15,500 people when completed.

The greenfield development requires two transport corridors, at an estimated cost of $400 million, which would extend the Boulevard and Te Okuroa Drive in Pāpāmoa.

If financing cannot be found, this could potentially add an additional $27,000 to the cost of each new home.

At a recent Tauranga City Council meeting, city planning and growth manager Andy Mead said the council started working on the business case for the roads four years ago.

At that time, the way the NZ Transport Agency Waka Kotahi funded arterials on greenfield sites had changed, he said.

Previously the NZTA funded half the costs, but their funding availability and policies had changed “substantially”, especially in greenfield areas, Mead said.

“To the point where they kind of don’t fund these roads anymore, or if they do, they only fund a small part… of a service.

“These transport corridors are very expensive in Te Tumu, around $400 million. The current approach we have around NZTA funding means we have a substantial funding gap.”

Mead said they were seeking support, not funding, for the Te Tumu roads at this stage as there was no confirmed timetable for development.

Homes in Te Tumu were unlikely to be completed before 2040, after land development and civil works timescales were taken into account.

The Boulevard’s preferred option was to be the area’s public transport route with two dedicated bus lanes and two for traffic.

Te Okuroa Drive’s preferred option was a dual carriageway with a dual cycle lane on one side and a shared path on the other.

Mead said they would be “limited access roads” that had no driveways, but intersections with local roads.

Committee chair Anne Tolley said multimodal transport options are important.

“Even if we just buy the land and we don’t get financing, because it is very difficult and expensive to come back later.”

The commission would not want the roads to narrow and government policy would likely change, Tolley said.

Council strategy, growth and governance manager Christine Jones told Local Democracy Reporting that if the council received just a 10 per cent grant of $40 million, instead of half, the rest of the funding would have to be found elsewhere .

If this financing couldn’t be found externally, it would have to be paid for by the developers, Jones said.

This could result in the 6,000 Te Tumu homes costing an additional $27,000 each, she said.

NZTA Bay of Plenty and Waikato regional system design manager Jess Andrew said the National Land Transport Fund does not contribute to the costs of growth where a private developer is the primary beneficiary.

This has been made clear since December 2021, she said.

“This is because public investments should be aimed at delivering public benefit. The costs of growth must be borne by the municipalities and developers.”

Any works that added a “wider public benefit” would be eligible for funding, Andrew said.

The business case will go to the NZTA for approval of the preferred options for the Te Tumu transport corridors.

LDR is local journalism, co-funded by RNZ and NZ On Air

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