The cost of operating and managing Queenstown's wastewater and water supply is running significantly over budget, due to expensive repairs and maintenance, a council report shows.
This could potentially mean fewer inspections and less money for renewals on the water network.
Gerry Essenberg, Queenstown Lakes District Council 3 waters manager (wastewater, stormwater and potable water), will present his Water and Wastewater Operations Update report to the council's utilities committee tomorrow.
The report shows the costs up until the end of January 2010, and reveals the wastewater expenses for Queenstown and Arrowtown are considerably over budget, while the Wanaka wastewater cost is slightly over budget.
Operation costs for Queenstown's water supply are dramatically over budget.
The remaining districts - Arthurs Point, Hawea, Albert Town, Luggate, Lake Hayes and Glenorchy - are all running close to or under budget.
The cost of repairing faults to the water network is significantly higher in Queenstown than in the rest of the district.
Compared to the other areas, the maintenance costs for wastewater in Queenstown are on average 3.2 times higher, and for the water supply 2.5 times higher.
The reasons for the higher cost are an older and more complex network, and the Queenstown area containing more services, being more intensively developed and not being as "contractor-friendly".
Usually, repairs and maintenance require more traffic management.
As an example of costly repairs, Mr Essenberg mentioned the broken pipe on the Fernhill Track, near the Twin Reservoir.
The fault was blamed on previous poor installation of pipes and incorrect valves.
The site had poor vehicle access.
The immediate repair cost $30,000, insurance cost of scour as a result of the leak was $70,000, and the future cost to replace the incorrect pipe and valves has been estimated at $250,000.
To meet the extra cost, the report suggested reducing the frequency of inspections and a reduction in CCTV work.
However, Mr Essenberg said it would not jeopardise the safe operation of the network.
"We have to look at cutting costs. But it would only be a reduction where the risk allows it. We would not put the council and ratepayers under any unnecessary risk by not doing inspections," he said.
Reserving part of this year's budget for renewals as a contingency to cover the overspending was also suggested in the report.
The proposed amounts to be set aside to cover the budget blowout are: $200,000 for Queenstown wastewater, $40,000 for Arrowtown wastewater, $20,000 for Wanaka wastewater and $400,000 for Queenstown's water supply.
A total of $660,000.
Mr Essenberg declined to comment further.
