Officials warn David Seymour's Regulatory Standards Bill could be more expensive than thought
Officials have warned David Seymour's Regulatory Standards Bill could be much more expensive than previous estimates suggested, and could lead to business uncertainty, slowing economic growth. Political reporter Russell Palmer spoke to Corin Dann.
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RNZ News
12 minutes ago
- RNZ News
CNMI's delegate seeks clarification from US Treasury on use of federal tax revenues
According to Section 703(b) of the CNMI's Covenant with the US, federal income taxes and other federal revenues derived from sources in the CNMI needs to be returned to the local government. Photo: Supplied The delegate for the Commonwealth of the Northern Mariana Islands (CNMI) to the United States Congress, Kimberlyn King-Hinds, has formally asked the US Treasury to clarify how fedeal taxes generated in the territory are being utilised. Delegate Kimberlyn King-Hinds sent a formal request to US Treasury secretary Scott Bessent seeking clarification. According to Section 703(b) of the CNMI's Covenant with the US, federal income taxes and other federal revenues derived from sources in the CNMI needs to be returned to the local government. In her letter, King-Hinds raised concerns that significant tax revenues linked to federal activity in the CNMI are not being returned to the local government as the Covenant provides. She pointed specifically to recent Department of Defence construction projects on Tinian totaling more than $153 million. Despite the scale of federal spending, the CNMI government received only $87,000 in reported tax revenue. "This provision was included in the Covenant to ensure that when activity happens in the CNMI, the returns from that activity are shared with the CNMI," she said. " "The people of the Northern Marianas and our government should see the benefit of economic activity occurring in their islands, especially when it is federally funded." Section 703(b) outlines a range of federal taxes that are to be paid into the CNMI Treasury, including income taxes derived from the CNMI and taxes on goods produced or consumed in the Commonwealth. King-Hinds noted that the provision applies regardless of where a contractor is headquartered, so long as the income is derived from work in the CNMI. "Nearly five decades after this language was adopted, we still do not have clear implementation of this section," she said. "As more federal funding and contract work flows into the CNMI, the question of how those revenues are treated under the Covenant is increasingly urgent." King-Hinds is requesting that the Department of Treasury clarify its interpretation of Section 703(b) and determine whether income taxes collected on work performed in the CNMI, particularly by off-island contractors, are appropriately credited to the CNMI government. She also indicated that if legislative steps are needed to reinforce the Covenant's requirements, she is prepared to work with Congress to advance those changes. "This is a practical issue with real consequences for the CNMI's ability to operate and plan for the future," King-Hinds said. "The Covenant will only endure if we remain committed to upholding its terms and ensuring its provisions are followed, including making certain the CNMI receives the revenues it is owed. I appreciate Secretary Bessent's attention to this request and look forward to a constructive dialogue on how we can ensure the Covenant is implemented as intended." During a recent CNMI House of Representatives hearing, Rep. Marissa Flores said the CNMI only collected a mere $87,000 in fees and taxes from $153-million worth of military activities in the Northern Marianas. Flores shared that data, which she said was shared at a recent meeting with the military, at the end of the House Standing Committee on Ways and Means budget hearing from the Department of Finance (DOF) last 9 July. "Why are we not collecting? What is the problem?" Flores asked DOF and the Division of Revenue and Taxation. "All this military build-up is happening…Are you collecting tax on developer's tax at all with the military?" she added. Division of Revenue & Taxation director Daniel Alvarez responded, "I do not believe the military projects fall under developer tax. I would probably have to confirm that with legal." Flores said the CNMI also needs to monitor how many military developers are being brought in because the island does not have the workforce. "We're losing money in that area. So many projects came and left, and we're only charging on the construction tax. Again, which is another problem, because now we know that they're bringing in their construction material," she explained. The lawmaker recommended that DOF have an increased presence on Tinian. Finance Secretary Tracy Norita later clarified that it has been a long-standing issue. "This is a conversation that has been going on between the municipality of Tinian and my office and [Department of Public Works] on who's going to assess the tax. "We've received information from DPW, I believe they've asked for [the Attorney-General's] opinion on whether they can assess the tax. To this day, I don't believe they're assessing it because there is no legal authority to assess the developer's tax on the military projects. "And so at this point, I believe it's legislation that's required to specify what exactly is exempted from the developer tax, whether it's a military project with an independent contractor or only military projects that are conducted by the military themselves," Norita added. "So again, it goes back to the legislation and the authority for DPW to assess the developer's tax." DPW Secretary Ray Yumul said they submitted an internal Legal Services Request form to the CNMI AG a few months ago but have not received a response.
RNZ News
12 minutes ago
- RNZ News
Utilising, protecting Bay of Plenty's geothermal taonga
Geothermal systems in Rotorua are used for a range of activities, including for tourism, health spas or powering large facilities like hospitals. Photo: The Bay of Plenty Regional Council is considering "tweaks" to allocation rules for commercial users of geothermal systems in Rotorua, but is holding fire on a region-wide plan to manage the natural resource. Late last year, the regulator went out for public consultation with updated draft management plans for the systems in Rotorua, Tauranga and the wider region, in efforts to greater streamline the consenting process. The geothermal resources are of cultural, social and economic significance to the region that has 12 geothermal systems. The systems are used for a range of activities, including for tourism, health spas or powering large facilities like hospitals . Furthermore, other uses for geothermal resources include drying timber at saw mills or using water for irrigation or frost protection in horticulture - in addition to generating electricity, heat or water. Bay of Plenty Regional Council's geothermal programme leader Penny Doorman said the resource was a taonga that was generally well managed, and there was even scale for greater use at some sites. But she said ongoing reform to the Resource Management Act - legislation which ordered "outdated" management plans be reviewed - resulted in the regional council pausing the wider regional management plan for the systems. "We've had to pivot a little bit because with the resource management reforms that are underway, council decided not to progress the regionwide plan change, they thought it would be better to wait until there's a bit more certainty about that. "But they have agreed to still go ahead with the changes to the Rotorua part of that regional plan change." Visitors at Te Puia explore Whakarewarewa Geothermal Valley. Photo: Supplied / Te Puia Up to 29 percent of overall use of geothermal water in Tauranga system was for horticulture, and made up 96 percent of geothermal water allocated to non-geothermal activities. In a submission, fruit and vegetable growers raised concerns that changes to geothermal systems management might result in further costs and compliance for users. However, Doorman said access to water for horticultural irrigators in Tauranga was not changing and the plan was progressing, however it would consider changes to allocation limits in Rotorua. "We have made some recommendations for changes to the allocation [in Rotorua]. There's always been a limit to how much geothermal water can be taken from the system and not reinjected, and that limit has just been reviewed through some careful monitoring," she said. "We're basically saying if you're taking geothermal water out of the system to take heat, then you've got to re-inject it." She said it identified a system-wide cap to the amount of heat that could be taken off the system. [audip] "The reason for that is that because it's really important to keep your water levels and your geothermal aquifer high but also hot because that's what our geyser system relies on," she said. "If we can keep heat within this safe operating space, then we know that we can protect the mauri or the health of the geothermal system." Meanwhile, in its submission, industry group Horticulture New Zealand said consent conditions should be reasonable and proportional to the environmental risks at the key Tauranga site. "The council's science has shown that the water quantity will run out before heat in the Tauranga system, so volume is the limiting factor rather than the heat source," it said. "Given that this is the case, non-geothermal uses of war water such as irrigation should not be restricted on the basis of retaining the heat source." It said consent conditions should also be "mindful of cumulative compliance cost on users." It added that there was significant potential for low-temperature geothermal water to be used with ground source heat pumps for zero-carbon greenhouse vegetable growing in future. Growers were also exploring new heat sources for their greenhouses in areas like geothermal, due to the rising cost and limited availability of gas. GNS Science, now the Earth Sciences New Zealand with NIWA, developed a geothermal and groundwater interactive map to help greenhouse growers switch to geothermal heating. Doorman said investigations were ongoing, including into the potential of Tauranga's low temperature geothermal system. She said collaboration with mana whenua was key to managing the natural resources. Sign up for Ngā Pitopito Kōrero , a daily newsletter curated by our editors and delivered straight to your inbox every weekday.
RNZ News
42 minutes ago
- RNZ News
'Great Rides' need double the money to keep running smoothly
The country's Great Rides attract about a million cyclists and walkers each year. File photo. Photo: RNZ / Chris Bramwell Maintenance funding for the country's 'Great Rides' trails will need to double in the next decade, or some will degrade so much they will lose that status. The trails generate just under $1b annually in benefits to regional economies, drawing about a million cyclists and walkers each year. The government puts $8m a year towards the trails through the International Visitor and Conservation Levy, with contributions totalling $129m since 2009. Councils have co-invested at least $60m into the rides in that time. But an Official Information Act response from the Ministry of Business, Innovation and Employment, released to RNZ, shows an estimated $160 million will be needed to maintain and enhance the Great Rides over the next 10 years. Per year, it is double the amount currently allocated for the network. "Without additional funding, there is a risk the Great Rides will gradually decline over time, potentially resulting in the removal of Great Ride status from some underperforming trails," the briefing to Tourism Minister Louise Upston says. NZ Cycle Journeys runs cycle hire and luggage transfer services across five of the trails and owner Geoff Gabites told Nine to Noon the trails were "perfectly usable" at the moment, but would need resurfacing soon - the maintenance largely done by local councils, with three trails covered by the Department of Conservation (DOC). He compared that to the 'Great Walks' tramping tracks fully managed by DOC - which owns and manages the huts, thereby collecting an income stream. "On the [Great Rides] trails, there is no mechanism whereby riders themselves can be levied or generate money for the trusts or councils that own the trails," Gabites said. When set up in 2009 under the John Key government, the Great Rides were intended to eventually become self-funding, but the OIA response showed this "has not eventuated as the economic benefits have not flowed back to the trails to allow them to maintain and grow to be a world-class asset". There are no direct revenue-gathering options for the trusts that operate the trails. The problem is exacerbated by trails that have been impacted by severe weather, like the Great Taste Trail in Nelson which will need rebuilding following the recent Tasman floods . "It's that sort of siphoning of money out of the $8m which the government currently fund per annum which is I think causing a significant decline in the ongoing funding available for maintenance," Gabites said. He said given the benefits, it should be on the government to support the maintenance of the trails. "It's hard to actually find a government initiative that has delivered that sort of degree of return, and so you would have to be saying to the government 'this is your investment, and it's really going to be upon you, I believe, to maintain and protect that investment'." They were considerably cheaper than urban-based cycleways to maintain, he said. "In terms of numbers, 48 percent of the riders travel specifically to ride these trails so they're not just 'happen to be there and then go and and do something', it's actually a driver into the region... the $8m that have been granted is the same degree of funding that was in place from, I think, 2018." The government has launched a "programme refresh to respond to this funding pressure", and also has a "full impact evaluation" for the 2024/25 fiscal year under way, scheduled for completion in September. Gabites said tourism operators benefiting from the trail where also were aware they should contribute, and that was being done on a voluntary basis - but it was currently the only way those operators were helping fund the trails. "So Cycle Journeys has had a luggage levy of 15 percent in there, and we've donated something like $126,000 over the last four years - but when the trail maintenance numbers are as high as they are, that's not sufficient to stay ahead of the game." Part of the problem was the lack of any way to charge the users of the trails, and the government's contracts with councils - many of which had a low rating base - left ratepayers to fund the maintenance. "There's multiple entry/exit points, so it's it's just never been set up to do this - and also legislatively as well, there's no mechanism," Gabites said. The MBIE briefing notes the government is exploring differential funding from councils "based on a local government deprivation index similar to that used by the New Zealand Transport Agency to fund roads". James Bell from ski and bike hireage company TCB Ohakune is heavily involved in the town's business community and said everyone including DOC and iwi seemed to be "pitching in where they can and where is necessary", but the trails themselves needed to be completed to make the whole system run smoother. "The biggest challenge right now - and this might sound a bit harsh - is we're currently driving a three-wheeled cart, because that cart isn't complete and therefore working on maintaining a three-wheeled cart is a lot tougher. Makes more sense, at least, for our community, to add that fourth wheel." As an example, many of the trails have been at least partly on-road since the scheme was launched, and the MBIE briefing notes that a $7.9m bid to have 120km of the Alps 2 Ocean ride shifted to off-road was rejected. Bell said there were also other ways to get the maintenance done, like new levies or commissions or through concession agreements. Minister Upston in a statement to RNZ said she was aware of the maintenance issues and cost pressures. "An ongoing challenge is how to generate revenue to reinvest into the trails to ensure they continue to offer a world-class experience. MBIE is currently working with sector partners to refresh the broader Great Rides programme. I'm committed to finding solutions to ensure the future of the Great Rides for Kiwis and international visitors alike," she said. The government has also confirmed plans to spend $3m on adding e-bike charging stations to the trails, with a second round of funding launched in June - however the MBIE briefing noted there was a "low level of support for installing e-charging stations" from stakeholders. Sign up for Ngā Pitopito Kōrero , a daily newsletter curated by our editors and delivered straight to your inbox every weekday.
