Over a number of years the Rotorua Te Arawa Lakes Programme has explored ways to improve lake water quality for the Rotorua Te Arawa Lakes.

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3 Introduction Over a number of years the Rotorua Te Arawa Lakes Programme has explored ways to improve lake water quality for the Rotorua Te Arawa Lakes. To protect and restore water quality in Lake Rotorua an integrated framework of solutions is being implemented to reduce concentrations of nitrogen entering the lake by 320 tonnes. $45.5 million of joint funding from the Ministry for the Environment and Bay of Plenty Regional Council is available to support land use change within the Lake Rotorua Catchment. $40 million is allocated to the Lake Rotorua Incentives Board, $2.2 million is allocated to the Land Use Advice and Support service to assist landowners with meeting requirements in the rules for Lake Rotorua Nutrient Management, and $3.3 million has been allocated to support trials of low nitrogen land uses that could be established in the catchment. This investment plan sets out how the Regional Council will ensure that the Low Nitrogen Land Use Fund maximises the opportunity to assist landowners to make decisions about adopting low nitrogen land uses within the catchment. 1

4 Funding objectives The Low Nitrogen Land Use Fund is intended to support land use change in the Lake Rotorua Catchment. It will do this by funding research which provides landowners access to useful and practical information that is relevant to the catchment: that describes the benefits, risks, opportunities and challenges of alternative land uses or farm systems that have low nitrogen yields, and that promotes the trial, application and uptake of low nitrogen land uses and farm systems in the catchment. It is intended that projects receiving funding will trial, examine and promote the uptake of low nitrogen emitting land uses or farm systems that are viable and credible alternatives to existing land uses and farm systems in the catchment. Funding outputs The output of each project will be expected to include detailed practical, system or financial information that will allow other landowners in the Lake Rotorua Catchment to make fully informed decisions about the viability of adopting that land use or farm system on their properties. The land use/farm system analysis is expected to be supported by robust scientific information. It should show how the system works, make credible estimates of the nitrogen losses that can be expected under land use/farm system scenarios examined in the varying conditions experienced in the Lake Rotorua Catchment. The primary intended audience for the project outputs is landowners in the catchment. However, it is expected the information may also be useful to other organisations for incorporation into other resources assisting to reduce nitrogen loss, for example, such as N loss prediction models, e.g. Overseer. The research activity funded by the Low Nitrogen Land Use Fund is expected to result in viable land use or farm system change in the Lake Rotorua Catchment leading to reduced nitrogen losses to Lake Rotorua. What will be funded The fund will be used to support three focus areas of research: Priority one How to promote additional uptake of existing low nitrogen land uses or farm systems in the catchment. This focus area is concerned with land uses/farm systems that already have established low nitrogen potential in the Lake Rotorua Catchment. In these instances, the fund would look to support the extension of this information to catchment landowners to promote uptake of low nitrogen land uses/farm systems by them. 2

5 Priority two The applicability of existing low nitrogen land uses or farm systems to local conditions in the Lake Rotorua Catchment This focus area is concerned with land uses/farm systems where previous investigations and trials have established that the land use or farm system has the potential for low nitrogen loss but perhaps only elsewhere in New Zealand. In this situation, the fund would look to support the ways in which this existing information could be applied to the Lake Rotorua Catchment. Priority three The potential of new low nitrogen land uses or farm systems to be adopted in the Lake Rotorua Catchment This focus area is concerned with new innovative land uses/farm systems that have not yet been investigated by field trials and investigations. In this instance the fund would look to support on the ground trials and investigations. Maximising the benefit The assessment criteria is developed to ensure that the proposals are representative of the wide range of situations in the catchment. While the assessment criteria are weighted, there is no pass or fail score. The weighting of the criteria will guide the decision-maker as to the suitability of the proposal and enables applications to be compared. The final decision to fund the project is at the discretion of the Regional Council based on all of the considerations set out. Funded projects will be selected to get as wide a range of application to catchment variability as possible, including applicability to a representative range of: Climate and geographical variability such as climate, rainfall and soil types. Land ownership structure such as trusts, Māori Incorporations and private land owners. Current land uses within the catchment. The primary benefit of the fund is to promote the adoption of land uses in the Lake Rotorua Catchment that leach less nitrogen, thereby reducing the amount of nitrogen entering the Lake Rotorua Catchment. It is recognised that substantial land use change in the Lake Rotorua Catchment has the potential to impact economically on the Rotorua District. Therefore, while being focused on promoting land uses that lose less nitrogen, the funding decision-makers will also consider the impacts of promoted land uses on the economic wellbeing of the district as a secondary factor. Minimising the risk Preference will be given to projects in the catchment that provide insights into the practical application of low nitrogen land uses and farm systems that are more proven. Investment may be made available for investigations into blue sky land uses or farm systems, but will be limited. 3

6 Funding approach The first funding round will be open to applications for any projects that meet the eligibility criteria. Applicants will initially submit an expression of interest providing a brief outline of the research proposal and process. Expressions of interest will be considered in terms of the eligibility criteria, and their consistency with this Investment Plan. Applicants who submitted expressions of interest that in the opinion of the assessment panel demonstrate a significant opportunity to contribute to a meaningful uptake of low nitrogen land use or farm systems in the Lake Rotorua Catchment will be asked to submit a full application. Full applications will be evaluated against the assessment criteria. To be accepted for funding, projects must be eligible, have appropriately addressed the assessment criteria, and have passed due diligence and public interest checks. Funding is subject to the successful negotiation of a mutually acceptable funding contract between the funder and the applicant. Funding is only confirmed when a mutually acceptable funding contract has been signed by all project participants, and approved by the funding decision panel. Funding will be paid in instalments, on the successful delivery of key project milestones. Ongoing funding is dependent on key project milestones being successfully achieved. Bay of Plenty Regional Council reserves the right to decline to fund any project if, for any reason, funding the project is not considered to be in the best interest of the ratepayers of the Bay of Plenty region. Following a review of proposals funded in the first round, the second round of funding will be targeted to resolve key catchment knowledge gaps that were not adequately addressed in the first funding round. At the time of preparing this Investment Plan the funds remaining for the second round of funding are earmarked for the work to calibrate Overseer for the Rotorua Catchment. Funding limit The first funding round will allocate funding of no more than $1.5 million in total. 4

7 Decision criteria Eligibility criteria In order to be eligible for funding, all applications to the Lake Rotorua Low Nitrogen Land Use Fund must meet the eligibility criteria below. Meeting the criteria does not guarantee the project will be funded. 1 The project must be able to demonstrate benefits in terms of either a measured or modelled reduction in N loss to the Lake Rotorua Catchment. 2 The results of the project must be applicable to land uses or farm systems within the Lake Rotorua Catchment. 3 Only projects of more than $10,000 value will be funded. 4 Projects seeking funding of more than $200,000 must be able to demonstrate an element of co-funding. Assessment criteria The following table outlines the assessment criteria that will be used to assess eligible projects. Category Assessment criteria Application to the Lake Rotorua Catchment and local interest Is uptake by catchment landowners considered, including Māori owned land? Is there wider support for the solution? Are there any community barriers to the solution? Is there interest from land owners in the catchment? Does the project outline an effective extension, education or communication component? Does the proposal include relevant members of the community and necessary partners? Benefits to the lake How widespread is the nitrogen reduction opportunity? What is the size of the nitrogen reduction opportunity? Does the project fit within one of the focus areas? Is the proposal consistent with the Cabinet funding? Broader benefits Does the project show commercial viability? Are points to market established, or explored? Does the proposal offer other benefits to the programme and or community? Does the proposal create jobs, or additional economic return to the district or region? Is additional investment or infrastructure needed to realise the benefits? 5

8 Capability and risk Does the project application contain adequate information to ensure viability? Alignment with the existing policies Is the project management and project team outlined and appropriate? Does the project contain plans for evaluation and monitoring of the benefits? Does the proposal include timeframes, after which conclusions may be made on the potential for nitrogen reduction, local application or uptake by catchment land owners? Are risks identified and mitigated? Is the level of risk acceptable? Does the proposal leverage funding from other sources? Are the project outcomes, KPI s, monitoring plan, and effectiveness clearly defined, appropriate, and realistic? Is the proposal consistent with the Regional Policy Statement targets for nitrogen reduction? Is the proposal consistent with Rotorua Te Arawa Lakes Programme Science Plan and in particular the land science gaps identified? Has the proposal been endorsed by the Land Technical Advisory Group? (if required) 1 Is the proposal consistent with the Te Arawa Cultural Values Framework, and any relevant iwi and hapū management plans? 2 Financial information Does the project cost demonstrate value for money? Does the amount of funding sought appear reasonable? 1 This assessment can be arranged by Bay of Plenty Regional Council if required. 2 These documents are available on request from Bay of Plenty Regional Council. 6

9 Conditions of funding All projects that are funded will be subject to the following conditions. Additional or varied conditions may be applied on a case-by-case basis, where considered appropriate by the funding decision-makers. Conditions of funding 1 The total funding to be allocated will not exceed the funding limit for each funding round (for the first round this is $1.5 million). 2 All research data, results, and findings must be made publicly available. 3 Contracts a. All offers of funding will be subject to a funding contract. b. The contract must be with one party (or lead party in the event of a consortium project). c. The contracted party must be a legal entity. d. The contract must identify all research partners, and the partner reporting responsibilities. e. The funding contract must specify detailed reporting and progress milestones. f. Successive funding payments will be dependent on the successful achievement of the previous milestone. g. The funding payments will be made directly to each partner, on successful completion of the required milestones, according to the funding arrangements within the contract. 4 Funding will only be provided to NZ tax residents. 5 Proposals must comply with New Zealand law to receive funding. a. As a minimum, full proposals will be expected to address compliance with health and safety legislation, the Resource Management Act, the Bay of Plenty Regional Plan, and where relevant, animal ethics legislation. 7

10 What will not be funded What will not be funded 1 Academic costs, or research pertaining to the cost of a qualification. 2 Any activities that are part of the statutory duties of local government. 3 Retrospective or backdated costs (being costs incurred before the signing of the funding contract). 4 Venture Capital or commercial development, such as setting up (new) or developing (existing) business activities, marketing a new idea, or making a financial profit. 5 Costs that do not accrue public benefit. 6 Costs associated with the normal day to day running of a business including, but not limited to: (a) Buying materials that are a normal part of an organisation s operations. (b) The maintenance and running costs of vehicles. (c) The capital cost of purchase or the maintenance cost of buildings, plant and equipment. (d) Capital costs of infrastructure to assist a landowner to meet their NDA. 7 Costs associated with complying with an organisations legal or regulatory obligations. 8 Proposals not consistent with NZ law. 9 Making or challenging applications for resource consent. 10 Land conversion costs (eg from Farming to Forestry). 11 Attendance at conferences. 12 Patents or copyright (products or outputs that will not be freely available for public, not for profit use). 13 Alcohol, entertainment, gifts or social expenses. 14 Costs associated with supporting a political position, campaign, party or movement. 15 International travel. 8

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