Funding assistance and sources

Introduction

This section describes funding assistance provided from the National Land Transport Fund and the sources of funding available for investment in land transport activities.

Funding sources for land transport investments

The sources of funds for investment in land transport activities under the National Land Transport Programme Interrelated and complementary combination of activities that, when delivered in a coordinated manner, produce synergies – can span more than one work category and more than one activity class, e.g. a programme could include a road improvement and public transport improvement activities. (NLTP A National Land Transport Programme Interrelated and complementary combination of activities that, when delivered in a coordinated manner, produce synergies – can span more than one work category and more than one activity class, e.g. a programme could include a road improvement and public transport improvement activities. adopted by the NZTA under section 19 of the LTMA, as from time to time amended or varied ) are:

• the National Land Transport Fund (NLTF The fund established under section 10 of the LTMA )
• Approved Organisations’ local share, and
• supplementary funding.

The Transport Agency also manages  Crown appropriated funds on behalf of the Ministry of Transport.

NLTF The fund established under section 10 of the LTMA funding

Revenue collected from Fuel Excise Duty (FED), Road User Charges (RUC Road user charges in accordance with the Road User Charges Act 1977. ), Vehicle and Driver Registration and Licensing, state highway property disposal and leasing and road tolling A toll payable under Part 2 of the LTMA. is credited to the NLTF The fund established under section 10 of the LTMA . These funds are used to pay for the Transport Agency’s investment in land transport activities.

The NLTF The fund established under section 10 of the LTMA funds comprise:

• nationally distributed funds (N funds The balance of funds in the National Land Transport Fund after accounting for R (regionally distributed) and C (crown) funds. N funds are allocated to the highest priority activities in each activity class across New Zealand, having accounted for R and C fund allocations. ), which are invested in activities of national priority following assessment and prioritisation under the Transport Agency's Investment Assessment Framework
• regionally distributed funds (R funds Funds from a 5 cent per litre increase in fuel excise duty and an equivalent increase in road user charges for light vehicles, to be distributed regionally on the basis of population (with Auckland receiving 35 percent of the total collected) for 10 years from April 2005. R funds are to be allocated to the highest priority projects in a region ahead of N (nationally distributed) funds. ), collected between 2006 and 2015 and pro-rated on the basis of regional population to invest in the highest priority improvement activities under the Transport Agency's Investment Assessment Framework within each region. The deadline for expenditure of R funds is 30 June 2018, and
• Crown funds (C funds Special funding for specific regions and specified activities as appropriated or directed by the government. ), from Crown appropriations made prior to full hypothecation of the NLTF The fund established under section 10 of the LTMA , allocated to specific activities or types of activities as originally directed by the government.

Funding assistance to Approved Organisations

Funding assistance is provided from the NLTF The fund established under section 10 of the LTMA to Approved Organisations for co-investment in the land transport system.

The Transport Agency's share of the costs of activities delivered by Approved Organisations is determined by use of Funding Assistance Rates (FARs). Approved Organisations are responsible for providing the remaining portion that is their local share of the total cost.

The Transport Agency receives 100% funding of the costs of any activity, or share of an activity, that it delivers, given that its only source of funding is the NLTF The fund established under section 10 of the LTMA .

Funding assistance rates for the 2012-15 NLTP A National Land Transport Programme Interrelated and complementary combination of activities that, when delivered in a coordinated manner, produce synergies – can span more than one work category and more than one activity class, e.g. a programme could include a road improvement and public transport improvement activities. adopted by the NZTA under section 19 of the LTMA, as from time to time amended or varied

The 2012-15 NLTP A National Land Transport Programme Interrelated and complementary combination of activities that, when delivered in a coordinated manner, produce synergies – can span more than one work category and more than one activity class, e.g. a programme could include a road improvement and public transport improvement activities. adopted by the NZTA under section 19 of the LTMA, as from time to time amended or varied  FARs comprise two main categories:

• FARs that are applied to the type of activity regardless of the Approved Organisation that delivers the activity, e.g. public transport services, and
• FARs that, for a given type of activity, vary amongst Approved Organisations, and include territorial authority base and construction rates.

The 2012-15 FARs are available at this link.

Funding assistance rates for the 2015-18 NLTP A National Land Transport Programme Interrelated and complementary combination of activities that, when delivered in a coordinated manner, produce synergies – can span more than one work category and more than one activity class, e.g. a programme could include a road improvement and public transport improvement activities. adopted by the NZTA under section 19 of the LTMA, as from time to time amended or varied

A review of the Transport Agency's funding assistance system was under taken in 2013-14, resulting in a revised methodology for determining FARs and changes to associated operational policy, e.g. emergency works funding. Approved Organisations will transition to their target normal FARs within 9 years, i.e. by 2023/24.

The Transport Agency's FAR The usual contribution in percentage terms, that the NZTA augments funding of an approved organisation, for the delivery of an activity or combination of activities. policy and a description of the methodology for determining normal FARs is provided at this link.

The 2015-18 FARs are available as follows:

• Normal Funding Assistance Rates which apply to all Approved Organisations for most activities
• Special Funding Assistance Rates which apply for specific activities
• Policy for Targeted Enhanced Rates

Supplementary (third party) funds

Supplementary funds Funding contributions that are additional to the contributions of the NZTA and standard approved organisation local share. They usually reflect third party benefits. refer to contributions that are additional to NLTF The fund established under section 10 of the LTMA and local share funding.

Main examples of supplementary funds Funding contributions that are additional to the contributions of the NZTA and standard approved organisation local share. They usually reflect third party benefits. are:

• development contributions towards the costs of improving network infrastructure (to the benefit of the development)
• betterment from landowners receiving value from road improvements
• Crown appropriations outside of the NLTF The fund established under section 10 of the LTMA
• additional contributions from local authorities or other parties that reduce the proportion of the Transport Agency’s contribution to the cost of an activity below the normal FAR The usual contribution in percentage terms, that the NZTA augments funding of an approved organisation, for the delivery of an activity or combination of activities.
• contributions from community groups or other government agencies to community programmes
• funds generated from road tolls A toll payable under Part 2 of the LTMA.
• borrowing and payments from concession agreements
• the value of land and buildings of redundant public transport facilities owned by local authorities, and
• funds from the sale of future development rights of a new or redeveloped public transport facility owned and operated by a local authority Any territorial authority or regional council within the meaning of the Local Government Act 2002. .

Funds managed on behalf of the Ministry of Transport

The Transport Agency manages the following funds on behalf of the Ministry of Transport:

• SuperGold Card funding,
• Crown appropriation for Accelerated Regional State Highway Programme,
• Crown appropriations for the Urban Cycleway Programme.

These funds are outside of the NLTF The fund established under section 10 of the LTMA and are distributed to activities in accordance with the Ministry’s direction.