Ōtautahi Community Housing Trust (Trust Variation) Bill

Ōtautahi Community Housing Trust (Trust Variation) Bill EXPLANATORY NOTE GENERAL POLICY STATEMENT Ōtautahi Community Housing Trust (the trust ) is a registered community housing provider under the Public and Community Housing Management Act 1992 and the Public and Community Housing Management (Community Housing Provider) Regulations 2014. The trust is also incorporated as a board under the Charitable Trusts Act 1957, incorporation number 2637371, and is a charitable trust registered under the Charities Act 2005, registration number CC53251. By deed dated 19 February 2016 (the trust deed ), the trust was settled by its original trustees (being Vicki Susan Buck, Andrew Turner, Paul Lonsdale, Alexander Michael George Skinner, Lloyd Matthew Mander, Pamela Joy Sharpe, and Stephen Leslie Phillips) to manage the Christchurch City Council’s community housing portfolio, and to address housing supply and affordability issues in Christchurch and Banks Peninsula, including by developing new social housing. The trust is the largest provider of community and affordable housing in the South Island. For context, the trust deed was amended in 2017 to include a reference to Banks Peninsula in the description of the charitable purpose of the trust. This was to make it clear (to avoid doubt) that Banks Peninsula is part of Christchurch, being a community board and ward within the Christchurch City Council district. This Bill amends the trust deed to allow the trust to provide social and affordable rental housing and associated services beyond Christchurch and Banks Peninsula. The proposal to expand the trust’s operations began with the Greater Christchurch Partnership (the Partnership ), a coalition of local authorities, mana whenua, and government agencies working together to address strategic challenges and opportunities for Greater Christchurch. In December 2023, the Greater Christchurch Partnership Committee adopted a Joint Housing Action Plan, which included an action to investigate expanding the Ōtautahi Community Housing Trust model. The Joint Housing Action Plan was subsequently adopted by all local authorities involved with the Partnership. Following adoption of the Joint Housing Action Plan, investigations into expanding the trust model have identified significant demand for the trust’s services and expertise beyond Christchurch and Banks Peninsula. On that basis, the trust seeks to expand its areas of operation. Doing so will diversify the trust’s revenue streams, increase its scale and impact, and enhance its financial sustainability. Operating outside of Christchurch unlocks significant benefits for Christchurch. Growth will strengthen the trust's presence as a community housing provider of scale and foster strategic partnerships that support the trust to provide greater access to quality housing for those in need. Expansion will facilitate economies of scale by spreading administrative and management costs across a larger portfolio. This will lead to a more efficient operation, and will ultimately reduce the cost of delivering services. It is intended that a more efficient operation with reduced costs will help to generate surpluses that can be reinvested into advancing the trust’s charitable purpose. Because of the size of the trust’s Christchurch housing portfolio, the focus of its services will always be Christchurch. Christchurch City Council’s approval is required for any material change to the trust deed as part of financing agreements in place between the Council and the trust. Christchurch City Council resolved to approve a material change to the trust deed, to allow the trust to provide services beyond Christchurch and Banks Peninsula, at a meeting on 11 December 2024. Clause 4.1 of the trust deed sets out the trust’s charitable purpose, as follows: The Trust is established and to be maintained to provide Social and Affordable Rental Housing and associated services in Christchurch and Banks Peninsula for the relief of Social Housing Tenants, for the benefit of such tenants and the wider community and not for the private pecuniary profit of any individual (provided that the provision of Social Rental Housing to a Social Housing Tenant does not constitute private pecuniary profit of that Social Housing Tenant) (“the Purpose”). As currently stated, the purpose clause prevents the trust from operating outside of Christchurch and Banks Peninsula. Specifically, the purpose is limited to providing social and affordable rental housing and associated services in Christchurch and Banks Peninsula. Those services are to be provided for the relief of Social Housing Tenants. The term Social Housing Tenants is also defined in the trust deed with reference to residents of Christchurch. Before the trust can expand its services, the trust deed must therefore be amended to remove restrictions in the trust deed that prevent it from providing services outside of Christchurch and Banks Peninsula. The amendment clause in the trust deed prohibits alterations to the trust deed that would permit the trust to operate, or any profits or surplus of the trust to be distributed or applied, other than to advance the trust’s existing purpose. Amending the trust deed to remove the restrictions in the deed that prevent the trust from operating outside of Christchurch and Banks Peninsula would be inconsistent with the trust’s existing purpose. Therefore, those amendments cannot be made through the trust deed’s amendment clause. Legal advice received by the trust indicates that an application to the High Court to vary the trust’s purpose—under the Charitable Trusts Act 1957 or the Trusts Act 2019, or pursuant to the High Court’s inherent jurisdiction—is also highly unlikely to succeed. Accordingly, the objects of this Bill cannot be achieved other than by legislation. CLAUSE BY CLAUSE ANALYSIS The Preamble describes the background to the Bill and sets out the objects of the Bill. Clause 1 is the Title clause. Clause 2 provides that the Bill comes into force on the day after Royal assent. PRELIMINARY PROVISIONS Clause 3 sets out that the purpose of the Bill is to allow for an expansion of the operations of the Ōtautahi Community Housing Trust (the trust ) outside of Christchurch and Banks Peninsula. Clause 4 is the interpretation clause. PURPOSE OF TRUST AND OTHER MATTERS Clause 5 makes various amendments to the trust’s trust deed to allow for the operation of the trust outside of Christchurch and Banks Peninsula. The Parliament of New Zealand therefore enacts as follows: 1 Title This Act is the Ōtautahi Community Housing Trust (Trust Variation) Act 2025 . 2 Commencement This Act comes into force on the day after Royal assent. 3 Purpose The purpose of this Act is to vary the terms of the Ōtautahi Community Housing Trust to allow for an expansion of the trust’s operations outside of Christchurch and Banks Peninsula. 4 Interpretation In this Act, unless the context otherwise requires,— board means the board of the trust (a board incorporated under the Charitable Trusts Act 1957) commencement date means the date on which this Act comes into force trust means the Ōtautahi Community Housing Trust established by the trust deed trust deed — a means the Deed of Charitable Trust - Ōtautahi Community Housing Trust dated 19 February 2016 between Vicki Susan Buck, Andrew Turner, Paul Lonsdale, Alexander Michael George Skinner, Lloyd Matthew Mander, Pamela Joy Sharpe, and Stephen Leslie Phillips to form a charitable trust to achieve the trust deed purpose; and b includes all amendments to the trust deed since that date. 5 Terms of trust varied On and from the commencement date, the terms of the trust are varied and the trust deed must be read as if— a the following definitions in clause 1.1 (interpretation) of the trust deed were replaced by the item set out in Part 1 of the Schedule : i Housing Related Charitable Purpose ; and ii Social Housing Tenants ; and b clause 4.1 of the trust deed (purpose) were replaced by the item set out in Part 2 of the Schedule ; and c clause 9.5(b) of the trust deed (board appointments panel) were replaced by the item set out in Part 3 of the Schedule ; and d clause 25.2 of the trust deed (winding up) were replaced by the item set out in Part 4 of the Schedule . The trust must, as soon as practicable after the commencement date, arrange for a copy of this section and the Schedule to be lodged with the Charities Register and the Charitable Trusts Register. Despite anything in this Act,— a the provisions of the Charitable Trusts Act 1957 continue to apply to the trust and the board as if the amendments made by this Act were set out in the trust deed and not in this Act; and b the board may amend the trust deed as if the amendments made by this Act were set out in the trust deed and not in this Act. Replacement terms of trust deed Housing Related Charitable Purpose means any purpose that is charitable in accordance with the laws of New Zealand and falls within the definition of charitable purpose in section 5 of the Charities Act where that purpose involves, or relates to, the provision of housing for the benefit of the communities in Christchurch and Banks Peninsula, and other areas as determined from time to time by the trustees, and includes the Trust Purpose. Social Housing Tenants means the residents of Christchurch and Banks Peninsula, and other areas as determined from time to time by the trustees, who are suffering genuine hardship or need, including without limitation the elderly, the young, the disabled, the unemployed and other low-income people. 4.1 The Trust is established and to be maintained to provide Social and Affordable Rental Housing and associated services in Christchurch and Banks Peninsula, and other areas as determined from time to time by the trustees, for the relief of Social Housing Tenants, for the benefit of such tenants and the wider community and not for the private pecuniary profit of any individual (provided that the provision of Social Rental Housing to a Social Housing Tenant does not constitute private pecuniary profit of that Social Housing Tenant) (the Purpose ). (b) an empathy with the people for whom the Trust would provide social or affordable housing. 25.2 In the event of the Trust being wound up and after all liabilities of the Trust have been discharged the Board shall transfer all remaining funds and assets comprising the Trust Assets to any one or more organisations operating in Christchurch or Banks Peninsula, or any other areas in which the Trust provides services, for those assets to be applied for the advancement of exclusively charitable purposes, and in particular for the Purpose or any other Housing Related Charitable Purpose. The receipt of the treasurer or secretary or other proper officer of such regional trusts or organisations shall be a sufficient discharge to the Board and the Board will not be bound to further see the application of those funds and assets.