AGEND
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A NO.
ACT
8.4
BOARD PAPER
INFORMATION
Paper no:
2018/12/1325
Meeting date:
14 December 2018
Barry Dowsett, Principal Advisor
Prepared by:
OFFICIAL
James Llewellyn, Manager Design Practice and Solutions
Recommended by:
Brett Gliddon,
THE General Manager System Design and Delivery
Board function:
Significant planning, investment and operational matters
Hamilton
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to Auckland Passenger Rail Start Up Service –
Subject:
Business Case Approval and Funding of Transitional Rail
and Public Transport Activity
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It is recommended that the NZ Transport Agency
Board resolves to …
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•
Endorse the Hamilton to Auckland Passenger Rail start up service Single Stage
ACT Business Case,
subject to condition subsequent that independent Stage Gate Reviews are undertaken during
Pre-implementation; to consider and approve: revised and updated costs (capital and
operating), improved demand forecasts, robust Customer Service & Marketing Plan, updated
Project Delivery & Assurance Plans and ful operational safety sign off.
•
Approve funding to Waikato Regional Council (fully funded Transitional Rail activity class) for
purchase of rolling stock; subject to a condition precedent where the cos
INFORMATION ts are agreed and
signed off by the NZ Transport Agency Chief Executive.
•
Approve funding to Waikato Regional Council (fully funded Transitional Rail activity class) for
Pre-implementation work associated with refurbishment of the rolling stock; subject to a
condition precedent where the NZ Transport Agency
OFFICIAL Chief Executive reviews and approves
the proposed level of funding; and subject to a condition subsequent that the right of
Transport Agency to re-use the asset shou
THE ld the start up service not proceed, or be
withdrawn during or at the end of the five year period.
•
Approve funding to the relevant councils (fully funded Transitional Rail activity class) for Pre-
implementation work associated w
UNDER ith rail below-track infrastructure and platforms; subject
to a condition precedent where the NZ Transport Agency Chief Executive reviews and
approves the proposed level of funding.
Continued…
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It is recommended that the NZ Transport Agency
Board resolves to …
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continued
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Approve funding to Waikato Regional Council (funded from Public Transport infrastructure at a
ACT
targeted funding assistance rate of 75.5%) for Pre-implementation work associated with the
operation of the service, including integrated ticketing; subject to a condition precedent where the
NZ Transport Agency Chief Executive reviews and approves the proposed level of funding.
•
Note that the total cost for al elements of the project is currently estimated at $78.249 mil ion (of
which $58.641 million is within the National Land Transport Programme 2018-21), with further work
required to gain greater certainty as to the final costs. INFORMATION
•
Note that for the National Land Transport Programme 2018-21 the project is assessed as having High
results alignment with a cost-benefit appraisal of Benefit Cost Ratio of 0.5, which requires approval
by exception, on the basis that it is a trial service that could be further developed to provide an
impetus to the wider corridor spatial planning work in the next five years.
OFFICIAL
•
Note that approval of Implementation funding wil be subject to Pre-implementation work
satisfactorily addressing the risk mitigation proposals and proceeding through independent Stage
THE
Gate Review; and wil require a further Board decision at the appropriate time.
•
Note that the impact of costs of the project to the National Land Transport Programme Transitional
Rail activity class is lower than information supplied in the October 2018 Board meeting, due to
updated costings for the proposed sta
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constitute Transitional Rail rather than Public Transport. This change lowers the risk exposure to the
overal over-programming in the Transitional Rail activity class for 2018-21 by around $12 mil ion.
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Responding to significant growth and lack of
transport choice between Hamilton and Auckla
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nd
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There has been significant population and business growth within Hamilton and t
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District, with high levels of projected demand for housing along the corridor
•
Waikato Regional Council (WRC) has been investigating a passenger rail service from Hamilton to
Auckland since late 2017
•
In order to access NLTF funds, WRC commenced the development of a Single Stage Business Case for
the Hamilton to Auckland (H2A) Start-Up Passenger Rail Service (SSBC) in August 2018
INFORMATION
•
The SSBC has been prepared under
significant time constraints - with WRC
and its local and central government
partners strongly committed to a
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March 2020 start date for the new
service
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•
In order to meet the March 2020
start-time, rolling stock refurbishment
and preliminary implementation is
desired to commence by January 201
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Hamilton to Auckland Integrated Corridor
Spatial Plan development
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• The Cabinet Economic Development Committee (April 2018) endorsed a partnership pro
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integrated strategic spatial plan for the Auckland – Hamilton Growth Corridor (the Corridor Plan)
• Ministry of Business, Innovation and Employment (MBIE) has lead a partnership group (including central and
local govt and iwi) that has facilitated the development of the Corridor Plan
• Objectives for the spatial plan are:
To better support growth and increase connectivity in a way that realises the corridor’s social, economic, cultural
and environmental potential by:
•
improving housing affordability and choices
INFORMATION
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enhancing the quality of the natural and built environments and the vitality of communities
•
improving access to employment, public services and amenities
•
creating employment opportunities.
• The high level development pattern is to concentrate growth at either end of the corridor – Drury – Pokeno
and the greater Hamilton City area
OFFICIAL
• Progress made to date includes development of a draft Spatial strategy that discusses corridor development
strategy, specific areas of focus and draft transfor
THE mational initiatives
• A staged approach to developing an intercity rail link is one of the identified draft transformational initiatives
• Next steps:
•
14 December 2018: Working draft Corridor Plan discussed with Leadership Group (Minister Twyford
and Local Govt political leaders
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January – July 2019: Complete Corridor Plan, broader consultation, agree forward partnership and
implementation
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INFORMATION
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The SSBC outlines the following service
and operational elements
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• Two weekday morning and evening peak trips, and one weekend service, between
Frankton (Hamilton) and Papakura, with intermediate stations at The Base
(Rotokauri) and Huntly
• Travel further north into Auckland from Papakura would require passengers to
change on to the Auckland Transport (AT) Metro network
INFORMATION
• Total journey time from Frankton to Britomart would be around 2 hours 30 minutes
• The proposed adult return fare from Frankton to Britomart is $32 (using two
smartcards)
OFFICIAL
• Two diesel locomotives and eleven newly refurbished carriages would operate the
THE
service
• The provision of Sunday and inter-peak services would be investigated through the
course of the five year period
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s 9(2)(g)(i)
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INFORMATION
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s 9(2)(g)(i)
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INFORMATION
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Key Issues for Consideration 1982
continued
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Sensitivity tests in the Business Case suggest that value for money will change depending
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on the
eventual costs and benefits:
Metric
Low
Mid (SSBC)
High
Very High
Patronage at Start
-20% below SSBC
As per SSBC
20% above SSBC
40% above SSBC
Patronage Growth
As per SSBC
As per SSBC
3.7%
3.7%
Operating Costs
+10% above SSBC
As per SSBC
As per SSBC
As per SSBC
INFORMATION
Capital Costs
+10% above SSBC
As per SSBC
- 20% below SSBC
- 20% below SSBC
Benefit (PV $m)
49.92
62.40
84.36
98.42
Costs (PV $m)
137.33
118.81
102.92
99.03
OFFICIAL
BCR
0.4
0.5
0.8
1.0
s 9(2)(g)(i)
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•
As lead infrastructure aligned to the Government Policy Statement on Land Transport (GPS) 2018 ,
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this project is a “transformational step change” for modal shift, but requires capex investment early
to achieve long run benefits
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s 9(2)(g)(i)
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Key factors for Transitional Rail and Public Transport
Funding Assistance Rate (FAR) Decisions
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•
These activities are key to achieving step change in mode shift from private
cars to public transport sought in the GPS for inter-regional travel
• These activities are nationally important in the context of the potential
contribution of rail to achieving GPS outcomes for the environment, access
and safety
INFORMATION
• The Hamilton to Auckland passenger rail represents ‘lead infrastructure’ with
levels of uncertainty in respect of patronage and cost, which is balanced by a
significant opportunity to commence inter-regi
OFFICIAL onal rail services between two
of New Zealand’s most populous and proximate cities
THE
• Funding is time-bound and ring-fenced in respect to the Transitional Rail
activity class, pending the outcome of the Future of Rail review
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Next steps
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If the Board agrees to and approves the recommendations in this paper: ACT
•
The Waikato Regional Council will be informed immediately
•
A media release wil be issued (prior to the relevant Minutes of the 14 December 2018 Board
meeting being confirmed)
•
The following information wil be made available on the Transport Agency website (to meet
obligations under section 20D(2) of the Land Transport Management Act 2003, after
approving or declining funding for activities or combinations of activiti
INFORMATION es, to place a copy of
the decision, and the reasons for the decision, on its website):
‘
Initiating an Hamilton to Auckland inter-regional Passenger Rail service will be a key enabler of
further regional and economic growth and providing modal choice for Corridor users and
residents. Providing staged funding wil allow the Co
OFFICIAL
uncils and key stakeholders to align this
service with the emerging Hamilton to Auckland Corridor Plan and enable a pathway to the
Government’s aspirations for a long te
THE
rm rapid rail service between the two Cities.
The start up service could also be integrated with better bus services to Waikato townships in
the Corridor, some of which currently have no bus service.’
•
The funds approved, if any, wil be released to the Waikato Regional Council for purchase of
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rolling stock (prior to the relevant Minutes of the 14 December 2018 Board meeting being
confirmed)
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