A new 10-year partnership between the New Zealand Government and Western Bay of Plenty councils has been established to align the planning, funding, and delivery of critical infrastructure and housing projects.
The regional deal was signed at Bay Oval by Deputy Prime Minister David Seymour, Infrastructure Minister Chris Bishop, and Local Government Minister Simon Watts, alongside local leaders including Tauranga Mayor Mahé Drysdale, Western Bay of Plenty Mayor James Denyer, and Bay of Plenty Regional Council chairwoman Matemoana McDonald. The agreement involves the Tauranga City, Western Bay of Plenty District, and Bay of Plenty Regional councils.
The partnership seeks to resolve what leaders described as years of disconnect between central and local government. Deputy Prime Minister David Seymour noted that the agreement marks a significant shift, stating, “For too long, there has been no co-operation,” and adding that the region has “never had this level of formal co-operation between local government and central government.”
Expansion of Tolling and Transport
A central and potentially contentious element of the deal is the commitment to “exploring further tolling.” This may include the introduction of tolls at the three main highway entrances to Tauranga, with the possibility of different toll rates for trucks.
The region already hosts two of New Zealand’s three toll roads, including Takitimu Dr and the Tauranga Eastern Link (TEL), the latter of which is expected to see more gantries soon. The Government has also confirmed that the Takitimu North Link (TNL) will be tolled upon its opening. Conversely, State Highway 36 towards Rotorua and State Highway 29 over the Kaimai Range remain untolled. A portion of State Highway 2 north of Tauranga is expected to become a local road once the TNL opens.
The deal prioritizes two Roads of National Significance: the widening of State Highway 29A for Tauriko West and TNL stage two (Te Puna to Ōmokoroa), which recently received Fast-track Approvals Act consent.
Economic Growth and Housing Targets
Infrastructure Minister Chris Bishop stated that the identified growth corridors—Tauriko West, the TEL, and the TNL—are intended to “unlock thousands of new homes and businesses and support thousands of new jobs.”
Projections for the region include:
- Approximately 12,000 new greenfield homes and 3,000 infill homes.
- At least 15,000 new jobs.
- 350 hectares of industrial land.
Specifically, the widening of SH29A is intended to support a 43-hectare expansion of the Tauriko Business Estate, industrial development at Lower Belk Rd, and roughly 3,000 homes in the Keenan Rd housing growth area.
Innovative Funding and Asset Recycling
Funding for these projects will be drawn from council long-term plans and government transport budgets. However, the deal introduces an “innovative feature” where central and local governments may jointly fund projects using a Crown “uplift” and proceeds from asset recycling, with contributions determined on a case-by-case basis.
Local Government Minister Simon Watts clarified that while no specific decisions have been made on which assets may be sold or repurposed, the strategy allows the government to “recycle assets to deploy that capital into areas of high priority.” These funds are earmarked for projects improving productivity along State Highway 2, including the Katikati Bypass and upgrades to Totara St, Hewletts Rd, and Hull Rd as part of the Connecting Mount Maunganui project.
The Katikati Bypass, a project discussed for decades with library records dating back to 1960, is now specifically on the agenda for funding via asset sales.
Long-term Implications and Challenges
While the deal provides a framework for the next decade, regional leaders cautioned that implementation will require strict adherence to collaboration. Bay of Plenty Regional Council chairwoman Matemoana McDonald described the agreement as an “important milestone” but warned, “There are very difficult waters that lie ahead of us.”
Beyond transport, the deal touches on healthcare infrastructure, noting Health NZ’s plans to redevelop Tauranga Hospital in stages over the next 20 years. This includes a push to release the hold on land at the Tauranga Racecourse, which had previously been earmarked for a new hospital.
Local MP Sam Uffindell emphasized the broader national importance of the deal, noting that the region’s freight and kiwifruit industries drive the export economy, stating, “When this region grows, New Zealand grows.”
What May Happen Next
As the partnership moves forward, the government and councils may begin identifying specific assets for recycling to fund the SH2 productivity projects. The region could see the implementation of new tolling structures at Tauranga’s main entrances if the current explorations prove viable. The release of the Tauranga Racecourse land may become a priority as the staged redevelopment of the hospital progresses.
