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Local Government (Water Services) Act 2025

Planning, reporting, and financial management - Financial matters

253: Charges as security

You could also call this:

"Water organisations can use your water bill as security to make sure they get paid back for a loan."

Illustration for Local Government (Water Services) Act 2025

If you have a loan or an arrangement with a water organisation, they can use the money from water services charges as security. This means they can use the charges to make sure they get paid back. A receiver is someone who helps manage the loan or arrangement.

You need to know that the receiver can collect water services charges without needing extra permission. They do this to cover the water organisation's commitments and their own costs. The receiver's costs include things like assessing and collecting the charges.

The water services charge is worked out as a percentage of the total charge for a property over 12 months. This charge is a debt that the water organisation can recover in court. The charge is subject to the Receiverships Act 1993.

Some words have special meanings in this section. A loan is what it means in section 112 of the LGA 2002. An incidental arrangement also has the same meaning as in section 112 of the LGA 2002. A property is a street address that is connected to water services.

A receiver cannot create or receive any interest or security in water services infrastructure. This means they cannot own or have a stake in the infrastructure. The water organisation is still in charge of the infrastructure.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=LMS1004409.

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Part 4Planning, reporting, and financial management
Financial matters

253Charges as security

  1. This section—

  2. applies if—
    1. a water organisation has granted a security interest over water services charges or the revenue from water services charges as security for a loan or the performance of any obligations under an incidental arrangement; and
      1. a receiver has been appointed under section 40A or 40B of the Receiverships Act 1993 in respect of that loan or arrangement; but
      2. does not apply to an Auckland water organisation.

        1. The receiver may, without further authority than this section, assess and collect in each financial year a water services charge under this section to recover sufficient funds to meet—

        2. the payment of the water organisation’s commitments in respect of the loan or arrangement during that year; and
          1. the receiver’s reasonable costs of administering, assessing, and collecting the water services charge.

            1. However, a receiver may not create or receive any interest or security in water services infrastructure.

            2. A water services charge under this section must be assessed as an amount that is a uniform percentage (which percentage may exceed 100%) of the total water services charge payable in relation to a property during the 12-month period ending on the last day of the calendar month immediately before the month in which the water services charge is assessed under this section.

            3. A charge under this section over any 1 or more of the assets of a water organisation is subject to the Receiverships Act 1993.

            4. A water services charge under this section—

            5. is a debt due to the water organisation; and
              1. is recoverable as a debt by the water organisation in any court of competent jurisdiction.

                1. In this section,—

                  incidental arrangement has the same meaning as in section 112 of the LGA 2002

                    loan has the same meaning as in section 112 of the LGA 2002

                      property means a street address that, at any point in a 12-month period ending on the last day of the calendar month immediately before the month during which a charge is assessed under this section, is (or has been) connected to 1 or more of a water organisation’s—

                      1. water supply services:
                        1. wastewater services:
                          1. stormwater services.