NOTICE OF MEETING. Aaron Bowman Chief Executive Officer

Transcription

1 NOTICE OF MEETING Dear Shire President and Councillors, I advise that the Ordinary Meeting of council will be held in the Council Chambers Home Island on Wednesday, 24 June 2015 commencing at 1.00pm. Aaron Bowman Chief Executive Officer COUNCILLORS PLEASE NOTE: DISCLAIMER The advice and information contained herein is given by and to the Council without liability or responsibility for its accuracy. Before placing any reliance on this advice or information, a written inquiry should be made to the Council giving entire reasons for seeking the advice or information and how it is proposed to be used. Please note this agenda contains recommendations which have not yet been adopted by Council. PO Box 94, Home Island, Cocos (Keeling) Islands INDIAN OCEAN 6799 Telephone: (08) Facsimile: (08)

2 TABLE OF CONTENTS ITEM SUBJECT PAGE 1 OPENING/ANNOUNCEMENTS OF VISITORS 4 2 ATTENDANCE/APOLOGIES/LEAVE OF ABSENCE (PREVIOUSLY APPROVED) 3 RESPONSE TO PREVIOUS PUBLIC QUESTIONS TAKEN ON NOTICE 4 4 PUBLIC QUESTION TIME 4 5 APPLICATIONS FOR LEAVE OF ABSENCE 4 6 PETITIONS/DEPUTATIONS/PRESENTATIONS 4 7 CONFIRMATION OF MINUTES OF PREVIOUS MEETINGS 8 ANNOUNCEMENTS BY THE PRESIDING MEMBER AND COUNCILLORS 4 9 DECLARATION OF INTERESTS 4 10 REPORT AND RECOMMENDATIONS 4 REPORTS OF OFFICERS Finance 10.1/F1 MONTHLY STATEMENT OF FINANCIAL ACTIVITY FOR 5 THE MONTH ENDING 31 MAY /F2 SCHEDULE OF ACCOUNTS PAID FOR PERIOD 1 MAY 2015 TO 31 MAY LEASES 10.2/L1 INSURANCE LEASED KAMPONG HOUSES 10 Administration NIL Works NIL 11 ELECTED MEMBERS MOTIONS OF WHICH PREVIOUS NOTICE HASBEEN GIVEN

3 12 MOTIONS WITHOUT NOTICE WITH LEAVE OF COUNCIL MATTERS BEHIND CLOSED DOORS CLOSURE OF BUSINESS 15 3

4 1. OPENING/ANNOUNCEMENTS OF VISITORS 2. ATTENDANCE/APOLOGIES/LEAVE OF ABSENCE 3. RESPONSE TO PREVIOUS PUBLIC QUESTIONS TAKEN ON NOTICE 4. PUBLIC QUESTION TIME 5. APPLICATIONS FOR LEAVE OF ABSENCE Cr Capstan and Cr Clunies Ross have provided written notification for leave of absence from this meeting of council. 6. PETITIONS/DEPUTATIONS/PRESENTATIONS 7. CONFIRMATION OF MINUTES OF PREVIOUS MEETINGS Recommendation That the minutes of the ordinary meeting of council held on Wednesday 27 May 2015 be confirmed as a true and correct record. 8. ANNOUNCEMENTS BY THE PRESIDING MEMBER AND COUNCILLORS 9. DECLARATION OF INTERESTS 10. REPORT AND RECOMMENDATIONS OF COMMITTEE 4

5 10.1 FINANCE 10.1/F1 MONTHLY STATEMENT OF FINANCIAL ACTIVITY FOR THE MONTH ENDING 31 MAY 2015 Report Information Location: Not Applicable Applicant: Not Applicable File Ref: Reporting Officer: Deputy Chief Executive Officer Island: Shire Wide Authority / Discretion Advocacy When Council advocates on its own behalf or on behalf of its community to another level of government/body/agency. Executive The substantial direction setting and oversight role of the Council. E.g. adopting plans and reports, accepting tenders, directing operations, setting and amending budgets. Legislative Includes adopting local laws, town planning schemes and policies. Review when Council reviews decisions made by officers. Quasi-Judicial When Council determines an application / matter that directly affect a person s right and interest. The judicial character arises from the obligations to abide by the principles of natural justice. Examples of Quasi-Judicial authority include town planning applications, building licenses, applications for other permits / licenses. Information Includes items provides to Council for information purposes only that do not require a decision of Council (i.e. for noting). Recommendation That the Financial Statements for the period 1 st of July 2014 to 31 st of May 2015 be RECEIVED. Report Purpose To inform Council of the financial position of the Shire at 31 May 2015 in compliance with the provisions of Section 6.4 of the Local Government Act

6 and Regulation 34 of the Local Government (Financial Management) Regulations Relevant Documents Attachments Statement of Financial Activity with accompanying notes Available for viewing at the meeting Background The Monthly Financial Statements for the period 1 st July 2014 to 31 st May 2015 are presented for consideration. Comment The Monthly Financial Report is prepared in accordance with the requirements of the Local Government Act 1995 and Local Government (Financial Management) Regulations. A statement of Financial Activity with accompanying notes is attached for the period 1 July 2014 to 31 May Policy and Legislative Implications Regulation 34 of the Local Government (Financial Management) Regulations 1996 requires all Local Governments to prepare each month a Statement of Financial Activity reporting on the revenue and expenditure for the month in question. Financial Management Regulation 34 also requires this statement to be accompanied by:- a. An explanation of the composition of the net current assets, less committal assets and restricted assets; b. An explanation of material variances; and c. Such supporting information that is relevant to the Local Government Financial Implications 6

7 Strategic Implications Conclusion That the financial statements for the period 1 st of July 2014 to 31 st May 2015 be received. 7

8 10.1/F2 SCHEDULE OF ACCOUNTS PAID FOR PERIOD 1 MAY 2015 TO 31 MAY 2015 Report Information Location: Not Applicable Applicant: Not Applicable File Ref: Reporting Officer: Deputy Chief Executive Officer Island: Shire Wide Authority / Discretion Advocacy When Council advocates on its own behalf or on behalf of its community to another level of government/body/agency. Executive The substantial direction setting and oversight role of the Council. E.g. adopting plans and reports, accepting tenders, directing operations, setting and amending budgets. Legislative Includes adopting local laws, town planning schemes and policies. Review when Council reviews decisions made by officers. Quasi-Judicial When Council determines an application / matter that directly affect a person s right and interest. The judicial character arises from the obligations to abide by the principles of natural justice. Examples of Quasi-Judicial authority include town planning applications, building licenses, applications for other permits / licenses. Information Includes items provides to Council for information purposes only that do not require a decision of Council (i.e. for noting). Recommendation That the list showing all accounts paid between 1/05/15 to 31/05/15, inclusive of Municipal Cheque numbers and 11355, EFT 3917 to EFT 3951 and Mastercard payments: totaling $202, be RECEIVED. Report Purpose To inform Council of funds disbursed for the period 1 May May

9 Relevant Documents Attachments Schedule of accounts paid Available for viewing at the meeting Background A list of accounts paid between 1 st and 31 th May 2015 is attached. Comment The schedule of accounts paid is submitted in accordance with regulation 13(1) of the Local Government (Financial Management) Regulations Policy and Legislative Implications Financial Implications Strategic Implications Conclusion That council receives the list stating all accounts paid for May. 9

10 10.2 LEASES 10.2/L1 INSURANCE LEASED KAMPONG HOUSES Report Information Location: Home Island Applicant: File Ref: Reporting Officer: Deputy Chief Executive Officer Island: Home Island Authority / Discretion Advocacy When Council advocates on its own behalf or on behalf of its community to another level of government/body/agency. Executive The substantial direction setting and oversight role of the Council. E.g. adopting plans and reports, accepting tenders, directing operations, setting and amending budgets. Legislative Includes adopting local laws, town planning schemes and policies. Review when Council reviews decisions made by officers. Quasi-Judicial When Council determines an application / matter that directly affect a person s right and interest. The judicial character arises from the obligations to abide by the principles of natural justice. Examples of Quasi-Judicial authority include town planning applications, building licenses, applications for other permits / licenses. Information Includes items provides to Council for information purposes only that do not require a decision of Council (i.e. for noting). Recommendation 1. That shire recover insurance cost for the 67 leased kampong houses on a tiered system relating to the insured value of the house and not at a flat rate per house. 2. That shire recover insurance cost for the 67 leased Kampong houses on a full cost recovery basis. 3. That shire reissue the invoices for kampong house insurance from October 2013 at the correct amount of $452 instead of the amount of $0 which was incorrectly issued. 10

11 4. That shire give lessees 3 months to pay the insurance invoice from October Report Purpose For council to consider the most appropriate method of recovering insurance costs relating to leased houses in the Kampong. Relevant Documents Attachments Available for viewing at the meeting Background Access to insurance in the Cocos (Keeling) region has been a major issue for the shire over the last few years following on from the major flood events that hit Queensland in At the 4th December 2013 meeting council considered not insuring the 100 houses on Home Island due to the rising premiums. In making that decision council considered the reluctance of the Department of Infrastructure and Regional Development to confirm that National Disaster Relief Funding would be made available to council if an adverse weather event did occur. In light of the Departments reluctance council resolved to pay the additional premiums to continue the insurance of the 100 houses. Clause 3.15 of the lease agreement for the Kampong leases sets out the provisions pertaining to insurance: 3.15 BUILDING INSURANCE (1) If requested by the Lessor, the Lessee shall take out and keep in force during the Term a policy of insurance in the joint names of the Lessor and the Lessee, for their respective interests, for all buildings, erections or other improvements comprised in the Premises for their full replacement value with an insurance company approved by the Lessor against fire, storm, tempest, earthquake, malicious damage and such other risks as the 11

12 Lessor shall determine and to allow the Lessor to hold the insurance policy. (2) If the Lessor elects to take out a policy of building insurance in respect of the Premises referred to in paragraph (a) then, the Lessee shall refund the premium paid for the insurance to the Lessor upon demand. (3) The Lessee shall pay to the Lessor on demand the full amount of any excess or deductible payable in respect of any claims under the insurance policy referred to in this clause. For the past few years council has absorbed the increase in insurance costs for the leased kampong houses, keeping the recoupment s at a similar level instead of passing on the steep increases it incurred. Insurance Premium attributed to 67 leased properties Insurance Premiums recouped from 67 lessees. Total declared value of the 67 leased houses 2010/2011 $45, $42,880 $11,390, /2012 $60, $51,724 $13,400, /2013 $123, $60,568 $13,400, /2014 $112, *$30,485 $13,400, /2015 $88, $60,970 $27,047,041 At the end of 2014, after many years of trying, Council was able to secure insurance through the Local Government Insurance Services (LGIS) industry based self-insurance scheme. LGIS is an industry based insurance organisation set up specifically to assist Local Governments in WA through a self-insurance scheme. The scheme provides support on effective claims and risk management to enable cost containment on insurance products for Local Governments. As illustrated in the table above, being able to secure this insurance through LGIS allowed for a significant reduction in premiums whilst at the same time more than doubling the declared insured value of the houses. Previously the shire was grossly underinsured on the houses in the kampong which in the event 12

13 of a claim would have resulted in the insurer reducing the payout by the percentage it was underinsured. SBA Gallagher, the shires previous insurer, also quoted on a renewal at the same time as LGIS based on the same declared values. The quote received had premiums attributed to the 67 leased properties at some $199, % more than the insurance we secured with LGIS. * In October 2013 the 6 monthly invoice for insurance was issued at $0 instead of $452, effectively resulting in only half of the insurance being recouped for that year. Comment Council should consider whether absorbing the extra insurance costs and not fully recouping the cost of insurance for the kampong houses that are leased is appropriate. Other private residences and business operating in the Cocos (Keeling) Islands that don t have a significant asset base like the shire either cannot get building insurance at all or can only access insurance which is grossly cost prohibitive. Currently the insurance is recovered at a flat rate per house with no allowance for the insured value given to different sized houses. In 2014 the shire engaged Landgate to value all its property assets to enable it to comply with new fair value accounting regulations. This valuation is used by the shires insurers and generally splits the properties up according to the number of bedrooms (this relates to the amount of bedrooms when originally built and does not account for additions since this time). Using the insured value for each type of house the below table shows the amounts that would have been charged this year had the shire chosen full cost recovery verses the amount actually recouped and the subsequent percentage this resulted in. Number of Bedrooms Number of Leases Full Cost Recovery Insurance Amount Recouped 2 Bedroom 16 $1160 $ % 3 Bedroom 42 $1309 $ % 4 Bedroom 8 $1459 $ % 5 Bedroom 1 $1955 $ % Percentage insurance recouped of Given the information above it is recommend that council start recouping costs in a tiered system tied to the insured value of the property instead of a flat rate 13

14 per house. Currently by using a flat rate the lessees of a 2 bedroom house are contributing more per $ insured than lessees of a 4 bedroom house. It is also recommended that shire charge the insurance out on a full cost recovery basis. As mentioned above it has come to management s attention that the 6 monthly invoice raised in October 2013 was incorrectly raised with an amount of $0 when it should have been for $452. This should therefore be corrected with an invoice going out at the correct amount, however given the circumstances and the fault of shire in not invoicing correctly extra time should be given to lessees to pay this amount. Policy and Legislative Implications Clause 3.15 of the Kampong lease agreements Financial Implications Resolving to recover insurance on a full cost recovery basis will mean the shire is no longer having to absorb extra costs associated with subsiding the insurance for the leased Kampong houses. In 2014/2015 of the total insurance costs of $88, only $60,970 was recovered leaving a shortfall of $27, If full cost recovery was implemented then there would be no shortfall. Strategic Implications Conclusion For council to consider the most appropriate method of recouping insurance costs and it is recommended that full cost recovery be implemented on a tiered system which is tied to the insured value of each house. 14

15 10.3 ADMINISTRATION 10.4 WORKS 11. ELECTED MEMBERS MOTION OF WHICH PREVIOUS NOTICE HASBEEN GIVEN 12. MOTIONS WITHOUT NOTICE WITH LEAVE OF COUNCIL 13. MATTERS BEHIND CLOSED DOORS 14. CLOSURE OF BUSINESS 15