New legislation addresses ‘earthquake-prone’ buildings

In response to recent earthquakes, the government has responded with legislation aimed at improving New Zealand’s resilience. Hon Dr Nick Smith highlights a key component of the strategy being the development of ‘suitable regulatory requirements for identifying and upgrading those older buildings that are significantly below today’s requirements for seismic resistance’.

The Building (Earthquake-prone Buildings) Amendment Act 2016 operates to address the condition of an estimated 15,000 – 23,000 (8 – 13% of non-residential and multi-storey/multi-unit residential buildings) ‘earthquake-prone’ buildings. Further, the government announced the launch of a $3 million dollar fund to subsidise the strengthening of ‘earthquake-prone’ buildings in Blenheim, Lower Hutt and Wellington. Local councils are required to contribute one-third of the fund. 

The fund will provide a maximum of $15,000 on façade works and $10,000 on parapet works. This seems a paltry amount given the costs of even minor earthquake strengthening. We could imagine the costs of administering the allocation of those funds close to or more than the total fund. Building owners will be notified by local councils as to whether works are required. The building works to affected buildings are required to be completed within 12 months from the start date under the Hurunui/Kaikoura Earthquakes Recovery Act 2016. The same Act will exempt work from requiring building and resource consents provided the works are overseen by a qualified engineer. Building owners need to take particular care when engaging said engineer that he or she has adequate PI insurance and their liability not unduly limited.

Concerns have been raised as to the effect of the financial pressure on building owners. The Wellington Inner City Association and others are calling for further financial and advisory support for building owners and to demystify the legal aspects of the process for body corporates and owners. Given court decisions going back to the 1930’s clearly identifying earthquake damage to buildings in New Zealand as a known risk, should rate and tax payers be subsidising private landlords?

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