REPORTS & FINANCIAL STATEMENTS

REPORTS & FINANCIAL STATEMENTS
REPORTS
REPORTS &
30th April 2016
23 March 2019
APPOINTMENT OF AUDITORS
ELECTION OF TRUSTEE
1141 Pukaki Street
PO Box 441
Tumunui Lands Trust
Tumunui Lands Trust
Chairman’s Report
23 March 2019
He maungarongo ki te whenua, He whakaaro pai ki ng tngata katoa. E nga uri o Tumatawera, Kahu Upoko me Tuhourangi e noho nei r, tenei te mihi ki a koutou m t mana rangatira ki tou whenua, ki tou maunga tapu a Tumunui, ar o ttou taonga katoa mai i a Rangi ki a Papatunuku. He tpapa whakaaro hoki tnei m ng tau kei te heke mai hei arataki, hei tohutohu i a ttou
ng hunga tiaki i t ttou ake whenua, taiao katoa.
Update
There are many changes on the horizon, much of which will be forced upon us by the Waikato Regional Plan chang-
es and the Bay of Plenty Regional Council. Whilst dairy is the most profitable in terms of income, we recognise also
that intensive dairy operations are not good for the land.
The Trustees therefore have taken the challenge forward to reduce our dairy footprint with alternative land use. We
have already commenced more planting of radiata pine on marginal land for dairy and we are also considering an
expansion of our dry stock operation, potentially into a larger deer operation. We are looking into early stages of a
joint venture for venison supply with a feasibility study currently in progress. This may or may not happen, but it is
more than likely we will increase our deer herd while reducing our Dairy footprint. More trees will be planted, both
exotic and native in order to protect our waterways, preserve the whenua and provide more opportunities for the
future generations and Trustees who will inherit this operation.
Tamaki Tours
Perhaps three years ago, the Trustees were in discussion with Doug Tamaki on the possible purchase of his brother
Mike’s share of the business. Doug was to remain in charge over all and Tumunui was planning on becoming Doug
Tamaki’s partner. This was however thrown into a spin when Doug suddenly died.
Since that time the Tamaki family have wanted to sell their majority stake in the business which Tumunui was una-
ble to afford. Tauhara North entered into negotiations first with the Tamaki Whanau, then with Tumunui Lands Trust
to ensure all lease arrangements and agreements remain in place. Overall it has been a seamless transition with
business as usual.
There may be other opportunities to partner with Tauhara North within the Tourism space although that will be a
work in progress.
Fords Farm
Tumunui continue to lease Fords Farm heading down to Kaiteriria and Rotokakahi. This is marginal land in terms of farming
and is really only good for low level dry stock. The water table is rising and the gully below the urupa is now permanently
wet, (the last time I checked). As this land is part of the original Tumunui block, we still have our eye on purchasing this
block at a fair price when the time comes. However, the owner of this land is presently selling lifestyle portions on the High-
lands Road side which is adjacent to our Maori Reservations and burial grounds. This is very disappointing with little we can
do. However, we will continue to work towards returning as much of the land as possible to you, the descendants of the
original owners.
Debt Reduction
With the recent harvest of trees on the whenua and Tumunui’s 28.21% stake in the Peka forest, our plan is to reduce our
debt over the next 3 to 5 years. We have mature trees to be felled over the next 3 years which will enable us to reduce debt
and expand the business in other areas. A reduction in the dairy footprint and an increase in pinus radiata will see forestry
rotations occur approximately every five years rather than once every 15 years or so. This will enable future boards to plan
knowing income from forestry will be more secure and consistent.
The Trustees are also working towards identifying our own people who have the skills to be employed by Tumunui in some
shape or form. This is now occurring through building maintenance and giving our own people an opportunity to tender for
work. Ultimately and I say it all the time, Tangata Whenua must build our own infrastructure. No one is going to do it for us.
Our tupuna once worked this land themselves and provided food for Marae, Tangihanga, whanau etc. and so we must work
toward this fabric of who we once were.
We must be educated and our eyes must be open to what’s happening in the world. Our various land trusts do need to start
working together to increase our land holdings and business development and education of our rangatahi.
Summary
The world is rapidly changing and not for the better. No one is going to help us unless we help ourselves. What will become
of our hapu if we don’t build the capability within ourselves to be able to run our entire operation within our own whanau. It
must come from the ground up. It must come from our own, but we must encourage the younger generation to study, to
focus and realise a long-term plan and make it a reality.
Naku
Tumunui Lands Trust
Purpose: To provide guidelines for the allocation and distribution of Tumunui Lands Trust funds to beneficiaries.
Guideline: The Trustees have the delegated authority to distribute trust funds within the budgeted total allocation as
determined each financial year.
Kaumatua Grants
$200 per beneficial owner who is 60 years of age and over
Discretionary grants $10,000 per annum
The grants include scholarships for students in their final year of tertiary study. Distributions must satisfy the require-
ments of s128 of the Te Ture Whenua Act 1993
Marae Grants $10,000 per annum
Apumoana Marae $5,000 per annum
Hurunga Marae $5,000 per annum
Dividend
Where a dividend or grant payable to a beneficiary may be subject to income tax, then that distribution will be paid from
tax free reserves subject to there being sufficient tax free reserves available.
All payments will be paid to a New Zealand bank account as specified by the applicant
DISTRIBUTION POLICY
Guardian of the whenua from Tumunui Mountain to Green Lake
OUR MISSION
To be within top 10% of performing Te Arawa Trusts leading the way through innova-
tion, farming, forestry and environmental tourism for the benefit of beneficiaries
Our values Respect for each other—our fellow Trustees, whatever their roles in helping to achieve our
goals; for the advisors, staff and business partners, and other trustees with whom we deal, for our beneficial owners as a whole.
Integrity in the ways we deal with each other, with those we deal with, and with those who display
interest in or support for our trust.
Professionalism in the ways that we discharge of our responsibilities and support the work of
our staff and business partners at every level.
Teamwork—The effectiveness of every member of Tumunui Lands Trust and the success of our
Trust and its work, depends on a range of fellow team members for resources, funding, advice, administration, support and planning.
Responsive to the needs and expectations of the beneficial owners we serve.
Pride in who we are, what we do and achieve.
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Zealand Fire Service. Current Chair of Tumunui Lands Trust and
many other land trusts including Te Puke 2B1C, Waipupumahana
A1B2 and Aokarere Ahu Whenua Trust. Wally is also a Trustee for
Kapenga M, Peka Lands Trust, executive member of Te Arawa
Primary Sector (TAPS) and committee member for Rotorua Project
Steering Committee with the Rotorua Lakes Council.
The Land Trusts supply primary produce from dairy, dry stock,
forestry and tourism with Te Puke 2B1C supplying Hayward Kiwi
Fruit to Eastpack.
Mokopuna of Walton and Lorna Lee and Te Kuru O Te Marama and
Rangitamoe Waaka, Wally continues the generational continuity of
kaitiakitanga, rangatiratanga along with developing tangible and
sustainable economic growth for future generations.
Craig Kusabs has a Bachelor of Science and
Veterinary Science as well as a post graduate Diploma in
Business Studies with Distinction. His association with
Tumunui goes back to the late 1980s where as a veterinary
student he worked on the sheep and beef farm plus the
newly developed deer farm. He was appointed as a trustee
in 2010. One of the key highlights of his time on the trust
was purchasing the neighbouring 126ha of adjoining land
from the Ford family and incorporating it back into Tumunui
which enabled the development of the newest dairy
operation.
The skillset that Craig brings as a trustee is through his
extensive knowledge of farming especially with animal
health and welfare which is complemented with both
human resources, strategic and business management
knowledge. Craig has been the leader of the Vetora BOP
(Rotorua District Veterinary Club Inc) for the last 16 years
which is now a multimillion dollar business with 4 clinics and
40+ staff.
Robert Macfarlane was elected to the
Trust in 2010 and is a shareholder through Opehuia Whanau Trust. As a young man he helped on his family farm run by his older brother. Milking, haymaking, fencing, were a great base to learn from.
Robert has had extensive management experience through his career in the motor vehicle industry, owning his own Export Orchard for 12 years and owning a restaurant for 14 years.
Robert has also been an active Industry Participant and was a past Chairman of the Tractor and Machinery Association of NZ and a vice president of the Hawkes Bay Fruit Growers Association. Robert has studied through the NZ Institute of Management and became an Associate Fellow.
Robert has held trustee positions with Whakarewarewa Rahui Trust and is past Chairman of the NZ Maori Arts and Crafts Institute (Te Puia) of 7 years.
Andrew Kusabs is born, bred and educated in
Rotorua. He studied at Victoria University in Wellington for four years completing his professional accountancy qualifica- tions.
Currently Andrew is a member of CAANZ and a Chartered Ac- countant.
As a chartered accountant Andrew was involved in offering advice to many Maori Authorities and the general business community and this has been beneficial in his role as a trustee.
In addition to his elected trusteeship roles, the Maori Land Court has also appointed him to Trusts where administration problems have occurred.
Andrew retired from the practice two years ago but continues to assist as required.
Andrew has been involved with Tumunui since it’s release from Maori Affairs control, firstly as it’s first secretary accountant and then as a responsible trustee.
ROBERT MACFARLANE
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AgFirst
Consultants Central Ltd Blackman Spargo Building, Level 2, 24 Froude Street
PO Box 976, New Zealand
AgFirst Consultants Central Ltd Blackman Spargo Building, Level 2, 24 Froude Street
PO Box 976, Rotorua 3010, New Zealand +64 7 349 4333
[email protected] www.agfirst.co.nz
1.0 BACKGROUND
Tumunui Lands Trust has re–invested heavily back into the business over the last five years. The focus has been on modernizing the dairy operations to become more efficient and productive, the drystock farms (mainly deer and beef) are progressing and areas of land deemed less suited to pastoral farming are part of a current forestry expansion programme. To a large degree it is part of achieving a suitable level of land use diversity and to spread business risk.
Every few years the “stars” line up for farmers, where productivity and market prices are both strong. That is the case at present. The Trust has positioned itself to take advantage of these good times.
The Trust is acutely aware of the need to adjust how land is utilised in the future, to ensure activities “above the ground” are commensurate with responsible Landcare and water quality outcomes.
Tumunui Trust is one of the largest deer farms in the Central Plateau and the Trustees have recognised that this enterprise “ticks a number of boxes” regarding the future shape of the Trust’s farming enterprise. These include:
Lower potential loss of nutrients to ground and surface water than dairy farming. Highly efficient conversion of feed to product. Strengthening market returns as venison and velvet hold niche market positions.
On this basis the plan is to expand the area farming deer from around 750 hectares to 1,000 hectares.
In line with the likely requirement to reduce nitrogen challenges to water quality and to meet the Trusts’ Greenhouse Gas mitigation commitments the area farming dairy cows may need to reduce.
By late 2020 the farms will be benchmarked for nitrogen (Nitrogen Reference Point) and develop a comprehensive Farm Environment Plan. Actions resulting from this plan will need to be in place by 2025 / 26. The trust does not farm in an intensive manner so any impact is likely to be lower than the industry average.
The Trust currently operates four large dairy farms and two drystock operations as well as having over 500 hectares of production forestry planted.
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2.1 DAIRY Farmed Area 1,950 ha (1,600 ha milking platform)
2.1.1 North
Located on Tumunui Road. Stretching out to the Peka Trust boundary to the North and running alongside Kapenga M Trust lands.
Farmed area of around 650 hectares. Reduced over the last three years as areas in the Rotorua Lake Catchment are being planted in forest. There is a further area identified for forestry over the next couple of years.
Runs 900 – 1,000 cows plus replacement young stock (this was reduced from 1,150 cows previously)
50 / 50 Sharemilkers= Russell and Naoko Johnston since June 2018.
2.1.2 South
Located on Wilson Road and runs from State Highway 5 under Tumunui Mountain out to the Kapenga M Trust boundary.
Farmed area of 500 hectares.
Runs 950 cows plus replacement young stock (For South and Kaiteriria Dairies).
50 / 50 Sharemilkers =Matt and Louise Pepper since 2014.
2.1.3 Kaiteriria
Located on State Highway 5 (Earthquake Flat Shed).
Farmed area of 400 hectares including the area purchased on the Eastern side of State Highway 5.
Runs 850 cows.
2.1.4 Reporoa
Located on State Highway 5 near the Fonterra Ltd factory. Includes both owned and leased land (Whaoa No. 2 Trust).
Farmed area of 400 hectares.
Runs 780 cows and replacement young stock (reduced by 80 cows in 2018 / 19).
This farm has the Trust’s own herd in place and is run by Contract Milkers, Brendon and Rebecca Symes since June 2018.
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Run lower number of cows per hectare than district average.
Invested in new technology, infrastructure and improved operational efficiency heavily since 2012
Reduced number of cows run from peak three years ago.
Developing Farm Environmental Plans
Pushing for fewer cows but more productivity per cow.
Investing in own herds – commenced in 2018
Reduced use of PKE and introduced feeds (by 65% since 2014 / 15) More “self- contained” mode of operation
Reducing environmental footprint
Quality not just quantity, productivity not just milk production. One of the area’s largest farmers
Combined 1.0 – 1.1 M kg MS
Tumunui Lands Trust
2.2 Drystock Farmed Area – 930 hectares (includes 180 hectares leased)
2.2.1 Pakaraka
350 hectares owned on State Highway 5 and 180 hectares leased from R&D Ford that runs down to Lake Rotokakahi. Total of 530 ha approx.
A mixed venison and velvet production unit with around 20% of stock units run being sheep / beef.
Managed by Bob and Robyn Foster.
2.2.2 Atiamuri
400 hectares owned.
Two blocks farmed jointly running from Parsons Road across to State Highway 33.
Mainly produces venison and beef but also trades / finishes lambs.
Managed by Graeme and Jeanette Birch
Number Overview
Sheep 1,000 (10%)
Cattle 420 (15%)
Deer 4,000 (75%)
Targeting a lift in deer numbers to improve venison production.
Tumunui farms run a moderate stocking rate and perform well.
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Add up to 250 hectares from dairy farms
Increase Breeding Hind Numbers and weaner trading output
Increase number of deer finished annually from around 2,100 to over 4,000 head.
Change forage / feeding system to enable Tumunui to supply venison over a nine to ten month period to obtain additional premiums (value add). Currently most of the venison supply falls in a 6-7 month period.
Continue with farm development to improve pasture quality.
Hinds Wnr Stgs / Hinds Vlvt / Brd Stgs No. sold ann.
Pakaraka 835 530 520 700
Atiamuri 870 1,100 30 1,370
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Dairy Pay out – Fonterra Ltd Average: $ / kg milksolids
Average and Peak Schedules for Drystock Products (2018 / 19) =$ per kg of carcass weight sold
NB forecast for Fonterra pay out for 2019 and 2020 years = $6.45 / kg MS+.
2010 2011 2012 2013 2014 2015 2016 2017 2018
Year $6.20 $7.60 $6.18 $5.84 $8.40 $4.40 $3.90 $6.12 $6.69
$0.00
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$12.00
$14.00
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Disclaimer:
The content of this report is based upon current available information and is only intended for the use of the party named. All due care was exercised by AgFirst in the preparation of this report. Any action in reliance on the accuracy of the information contained in this report is the sole commercial decision of the user of the information and is taken at their own risk. Accordingly, AgFirst disclaims any liability whatsoever in respect of any losses or damages arising out of the use of this information or in respect of any actions taken in reliance upon the validity of the information contained within this report.
4.0 INDUSTRY MATTERS
4.1 Health and Safety
Each farm has an approved plan and system in place. These have been audited by Worksafe.
4.2 Staff Housing
The Trust has continued to upgrade these over the last five years. There is still work to do but all have required insulation in place. There are 22 houses across the farms.
4.3 Animal Welfare
This is non–negotiable and our managers / sharemilkers work closely with the veterinary professionals throughout the year.
4.4 Water Use
In line with the Waikato Regional Council consent process the dairy sheds monitor weekly use. Tumunui already has systems in place to reduce water use; eg, solid separation dairy effluent and recycling washdown water.
4.5 Landcare and Water Quality
Industry has measures to deal with four key items
Loss of N to waterways Loss of P Sediment movement / erosion e–coli levels in ground water.
5.0 SUMMARY
Hill country farming is in the spotlight as far as sensible and sustainable land management practices for the future are concerned. Tumunui Lands Trust is taking a proactive stance in adopting change that meets economic, asset care and environmental needs of the future. Farming smarter and using the available resources more efficiently are keys to a successful transition.
Tumunui has improved productivity by investing wisely across three sectors (dairy, drystock and forestry). This also means the risks involved in primary industry are spread.
The teams on the ground are all very experienced and operating in a smart efficient manner.
My thanks to the Trustees and Lau for their on–going support and guidance.
Peter Livingston Director / Agribusiness Consultant 027 449 1078
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FOR THE YEAR ENDED 30th JUNE 2018
The financial report for the 2019 General Meeting has been summarised below. Full audited financial
reports are provided separately.
INCOME
. The Trust’s income is generated from its Deer, Sheep and Beef Farms, 3 Dairy Units and Forestry.
During the 2018 year the Trustee’s made a decision to move from sharemilking on Reporoa Farm (receiving
only 50% share of milksolids revenue) to purchasing the Trust’s own herd and receiving 100% of the revenue
from milksolids produced. This will be reflected in the 2019 year.
Gross Loss from Livestock was $109,176 in 2018 (Gross Profit $918,359 in 2017). Purchasing the herd cost
the Trust $1,136,376. Income from other sources i.e. velvet, wool, rebates, rent, dividend and interest
received was $511,675 (2017 $433,473). No tree proceeds were received for the 2018 year.
EXPENSES
($1,000,000)
$0
$1,000,000
$2,000,000
$3,000,000
$4,000,000
$5,000,000
Livestock Proceeds Milksolids Timber Proceeds Other Income
-$500,000
$0
$500,000
$1,000,000
$1,500,000
$2,000,000
$2,500,000
2014 2015 2016 2017 2018
Farm Operating Expenses R&M and Vehicle Expenses Admin Expenses Fixed Expenses Change in Livestock Values
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The increase in Farm Operating Expenses (21%) from $1,815,278 in 2017 to $2,206,998 in 2018 was a result
of an increase in spending on Animal ID, Animal Health and Freight & Cartage $58,800, Fencing $64,273,
Fertiliser $61,126, Forestry $98,549 and Weed & Pest $102,970.
Repairs and Maintenance were up in 2018 (65%) to $421,724 from $255,801 in 2017 due to increased costs
on bringing Employee Accommodation up to acceptable living standards and repairing races & tracks due to
weather conditions. Repairs to Plant & equipment also had an increase. Vehicle expenses increased by
$10,000 to $41,526 due to tractor repairs.
Administration Costs were up (25%) to $338,623 from $269,564 in 2017. Accountancy & Secretarial costs
rose slightly to $109,997 from 102,080 in 2017. Audit Fees remain constant at $12,894. Trustees Fees &
Expenses rose from $49,852 in 2017 to $75,833. Farm advisory also increased from $54,263 to $73,789.
Fixed Expenses include Insurance, Interest, Legal Fees, Rent and Rates. These expenses increased (5.6%)
to $1,332,904 in 2018 from $1,262,536 in 2017. This increase was mainly due to the increase in legal fees
from $160,952 to $235,885 in 2018.
NET SURPLUS/(DEFICIT)
The Net Operating Surplus for the year was $245,861 compared to 2017 of $496,695. After adjusting for
capital expenses deductible for tax purposes and other timing differences, the Trust had an Income Tax Profit
of $252,893 (2017 Taxable Income $504,944). The Trust has tax losses from prior years of $510,991
available to carry forward to future years. These losses are available to offset future taxable income.
BALANCE SHEET
The Trust’s equity has increased by 19.2% to $59,190,076 (2017 $49,651,443).
Assets
Liabilities
Equity
$0
$10,000,000
$20,000,000
$30,000,000
$40,000,000
$50,000,000
$60,000,000
$70,000,000
$80,000,000
A xi
s Ti
tl e
Chart Title
$59,190,076
$49,651,442
Current Assets comprise Cash at bank, Accounts Receivable, GST Refunds, Tax Refunds, Prepayments and
Livestock on Hand. The increase in Current Assets was due to GST refund due on purchase of Reporoa
Livestock, increase in milksolid income to end of the season due, and increase value of livestock on hand re
Reporoa .
Non-Current Assets comprise Fixed Assets and Investments.
• Fixed Assets increased by 18.2% to $62,574,210 from $52,947,595in 2017. This increase was due
to Government Valuations on Land, Property Improvements & Buildings increasing by $7,868,046.
The valuation on the Trust’s trees both on it’s own land and JV with Peka Trust increased by
$1,567,026. Over $650,000 was spent on improvements to water, bores, effluent systems and plant
& equipment.
• Investments (shares) fell to $6,650,285 from $7,282,293 in 2017 due to the drop in Fonterra share
values.
Current Liabilities consist of Accounts Payable, Bank Overdraft, Employee Leave Accruals, GST and
Taxation Payable and Bank Loans due for payment within the next 12 months.
The bank overdraft and current portion of term loan were $1,660,488, up from $666,259 in 2017, due to
purchase of Reporoa livestock.
Non-current Liabilities comprise Unclaimed Dividends and Bank Term loans.
• Unclaimed Dividends stand at $824,124 at balance date, up from $794,957 in 2017.
• Bank Term Loans and Fonterra Loans (net of current portion) are $12,461,072 similar to 2017.
Lau Lasike (BMS, CA) Kusabs Lasike Limited, Chartered Accountants
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General meeting of owners – 30/04/2016 Page 1
Minutes of the general meeting of beneficial owners of Tumunui Lands Trust held at Tamaki Maori Village, 1072 State Highway 5, South Rotorua on Saturday 30 April 2016,
commenced at 11.30am
PRESENT: Craig Kusabs (Chair), Don Bennett, Wally Lee, Robert Macfarlane (responsible trustees) and 138 owners and descendants of owners as per the list attached to the minutes
IN ATTENDENCE: Lau Lasike (Secretary/accountant), Peter Livingston (Farm Advisor), and Mr Matt Pepper (South Dairy sharemilker), John Chadwick (Trust’s solicitor)
KARAKIA/MIHI: Were offered by Wiremu Keepa
APOLOGIES: Andrew Kusabs, Hereaka Meager, Rose Parehaua Lane MOVED Robert Macfarlane/Reema Hall RESOLVED “That the apologies as listed be received” CARRIED (by voice)
WELCOME: By Craig Kusabs. He thanked everyone for their attendance and acknowledged those who have travelled from further afield such as Wellington and Whangarei. He advised that the attendance and apologies registers were currently circulating in the room for attendees to sign and add any apologies to the apologies register before returning the registers to the Secretary. He noted that the business for the day were as follows:
To receive the trustees, farm supervisor, forestry reports, and financial statements for the year ended 30 June 2015
To appoint the auditors. Messrs Dixon & Co are available for reappointment
To vary the Trust Order as follows:
Title “This Trust shall apply to the Trust Freehold land known as Tumunui and all other assets owned and managed by the Trust Board from time to time”
Trustees “There shall be a maximum of 5 Trustees with an operating quorum of 3. Upon the death, resignation or removal by the Court of a Trustee, the remaining Trustees may call a special general meeting for the purpose of filling the vacancy or they may elect to do that at the next general meeting”
General Meetings “The Trustees shall call a general meeting of the beneficial owners within 12 months of the establishment of this Trust and then from time to time and at least once every 2 years and a general meeting shall be called by the Trustees upon service of a notice of a requisition in writing signed by not less than 20 beneficial owners stating the purpose for which the meeting is required”
Strategic Plan & Distribution Policy
Matters arising
General Business
TRUSTEES REPORT: The trustees report was tabled and spoke to by Craig Kusabs.
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He begun by introducing himself and the trustees and advisors who were at the meeting. He then acknowledged Don Bennett leadership during a major growth phase in the history of the Trust. He served 30 years as chairman. Alongside Andrew Kusabs they are very proud of where the trust is today. He spoke to Tumunui of yesterday and what it has become using photos to demonstrate those views. The trustees’ report covered:
Highlights from 2015
Environmental compliance
Tumunui maunga
Appreciation In conclusion, Mr Kusabs noted that it is the expressed intension of the trustees that they are respectful and careful kaitiaki of the assets entrusted in their care. He said that the trustees take pride in their roles and he sincerely hopes that the owners are pleased with the outcomes that they have achieved in 2015 especially, during challenging times affecting the dairy industry which is the Trust’s main income stream. Peter Staite spoke briefly to the history behind Pakaraka and Tumunui lands. He said that it is important that we know who the mana whenua is because it is important from a historical context that we know where we come from and who we are today. Therefore, in his view, a sub-committee should be established to develop and install a Trust’s cultural policy. MOVED Peter Staite/Rawiri Daniels RESOLVED “That a sub-committee is established to develop and maintain Trust’s cultural policy” CARRIED (by voice) Mr Rawiri Daniels asked if the Trust has a health and safety plan and policy. He also wanted to know if the trustees have trustee liability insurance cover. Mr Kusabs noted that health and safety is a serious matter and the trustees take their responsibilities seriously. He spoke to trustees’ liabilities which are akin to directors’ liabilities in which each and every trustee is personally liable for any breach of the health and safety legislation. The secretary added that fines from breach of those statutes are not covered by any insurance policy as per the legislation. Mr Livingston advised that the trustees share those responsibilities with the sharemilkers. Mr Staite asked Mr Livingston if Reporoa Dairy has a health and safety plan and policy. Mr Livingston responded that Reporoa Dairy has the same plan and policy as the Trust’s other dairy farms.
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Mr Kusabs was asked whether it is better to use “Tumunui Lands Trust” rather than just “Tumunui” on Trust’s signs. Mr Wally Lee noted that mana whenua is important to the Trustees. He said that the trustees are currently investigating the history behind the Trust’s lands and mana whenua will be reflected on Trust’s signs once the investigation is completed. The trustees were also asked which of the Trust’s operations is the most profitable per hectare and whether owners are employed on Tumunui. The secretary responded that Tamaki Maori Village rental is Tumunui’s most profitable operation per hectare. Mr Lee added that Tamaki Village staff are predominantly consist of Tumunui owners and descendants of Tumunui owners. He also eluded to a possibility of Tumunui becoming a party to the Tamaki brand. He acknowledged that discussion between the parties are in its early stage but it is an opportunity that the Trust is taking seriously. On the table for consideration are the Tumunui Maunga and its native forest, honey, and eco-tourism. In respect of these opportunities, the trustees were asked to consider taking the owners along on their journey and be more transparent about them. In response to this request, Mr Lee repeated that discussion is still in its early stage, and whilst some of the issues are commercially sensitive, he is hopeful that the Trust will have something concrete to table at the next general meeting. Mr Kusabs added, that the Trust is developing its own website which will improve communication between the owners and the trustees in the future. One of Mr Matt Pepper’s staff’s husband got up and spoke to his wife’s job. He said that they have been working for Landcorp for some time and when the opportunity arose, she applied and got the job on her own merits. Mr Pepper only found out after she was offered the job that she was an owner. He also spoke highly of Mr Pepper as a boss and Tumunui’s entire operations.
FORESTRY REPORT:
The forestry report was tabled and spoke to by Mr Robert Macfarlane.
About 470 hectares is in forest
Trust forest is mainly Pine Radiata but there are pockets of Douglas Fir, Lucitanica, and Blackwood
7 hectares were harvested recently
Proceeds from the log sale were utilised to reduce debt and invest in capital expenditure
Going forward, the Trust’s plan involves planting policy that will ensure a continuous income stream from log sale
The trustees are also considering Manuka and Manuka honey as another potential income source to complement the Trust’s forest policy
Mr Macfarlane acknowledged the contribution of Mr Shane Perrett’s, who is the Trust’s Forestry Advisor
FARM REPORT: The farm report was presented and spoken to by Mr Peter Livingston on the farm as part of the farm visit. He was assisted by Mr Matt Pepper. The report covered:
Background
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The farms
Industry focus
Health & Safety
Staff housing In summary, Mr Livingston noted that the Trust has not held back in looking at ways to improve productivity and long term profitability. It is not all about production only however, it is as much about maintaining cost effectiveness and using the resources/assets much more efficiently. The trustees have directed that these outcomes must occur. Mr Livingston stressed that the Trust’s farms are hill country in nature and because of size and contour the task is not simple. It will take another 3 years to get to “base camp”. Whilst the Trust aim to do this out of cashflow, the current dairy downturn has provided a challenge in itself. However, the Trust has good, experienced managers and sharemilkers in place and this is crucial in achieving progress. Mr Livingston was asked whether there are career opportunities for our tamariki on Tumunui farms. Mr Pepper responded that he is a great believer in giving the youth an opportunity to make a living in farming as the industry is desperate for successions. So he challenged the owners to send him their kids and he will employ them if they are keen.
FINANCIAL: Mr Lau Lasike tabled and spoke to the financial report for year ending 30 June 2015. He advised that copies of full audited financial reports are available and provided separately. The financial report summarised the Trust’s:
Income
Expenses
Operating deficit
Balance Sheet
Trust’s Equity Mrs Veronica Butterworth wanted to know why the Trust owns so many buildings and whether they were all dwellings. Mr Livingston responded by saying that the Trust owns 22 dwellings and they are all employee accommodations. That being said there are more than 22 employees on Tumunui. Mr Kusabs added that the Trust has a maintenance programme in place. Concerns were raised in relation to unclaimed dividends. Mr Lasike explained that unclaimed dividends belong to the owners and they remain a liability in the Trust’s accounts until they are claimed. He noted that in the past few days an owner who has been overseas for the past 10 years, turned up to his office and claimed her dividend. Mr Lee added that under Te Ururoa Flavell’s proposed Act, owners will have a fixed period of time to claim their dividends. After that, they are gone. Mr Daniels noted that this the first time he has seen a copy of the full audited financial statements. He said that they contain information that needed to be perused carefully over time. Therefore, he would have liked to have received them prior to the meeting. Ms Colleen Pinter noted that those statements and all the reports were available for some time prior to the meeting from the Secretary’s office. However, Mr Daniels moved that the
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reports are posted to known addresses prior to general meeting. His motion was seconded and was carried by voice. Mrs Reema Hall suggested that in addition, those who want a copy of the reports prior to the meeting should contact the office and request it.
REPORTS WERE RECEIVED AND ADOPTED:
MOVED Veronica Butterworth/Chase Katene RESOLVED “That the trustees, farm supervisor, forestry reports and the financial statements for the year ended 30 June 2015 be received and adopted” CARRIED (by voice)
APPOINTMENT OF AUDITORS:
The secretary advised that Messrs Dixon & Co are available and recommended their reappointment MOVED Airini Hepi/Katarina Palmer RESOLVED “That Messrs Dixon and Co are reappointed as Tumunui’s auditors” CARRIED (by voice)
VARIATIONS TO THE TRUST ORDER:
Mr Kusabs invited Mr John Chadwick on to the stage to speak to the proposed variations to the Trust Order. Those variations are as follows:
Title “This Trust shall apply to the Trust Freehold land known as Tumunui and all other assets owned and managed by the Trust Board from time to time”
Trustees “There shall be a maximum of 5 Trustees with an operating quorum of 3. Upon the death, resignation or removal by the Court of a Trustee, the remaining Trustees may call a special general meeting for the purpose of filling the vacancy or they may elect to do that at the next general meeting”
General Meetings “The Trustees shall call a general meeting of the beneficial owners within 12 months of the establishment of this Trust and then from time to time and at least once every 2 years and a general meeting shall be called by the Trustees upon service of a notice of a requisition in writing signed by not less than 20 beneficial owners stating the purpose for which the meeting is required”
Mr Chadwick began by introducing himself. His relationship with the Tumunui started 40 years ago. His former business partner is recently retired Judge Ken Hingston and he is the oldest Maori lawyer who is still in practice in New Zealand. He then explained how each variation came about, what it means, and how it is supposed to work. He noted that the variations are to be considered in their totality. Trusteeship was discussed at length. In particular, the trustees term of office. A rotational policy was suggested. But Mr Chadwick advised that it is not a part of the proposal. He also noted that the Maori Land Court runs seminars on trusteeship for newly elected trustees with no trusteeship experience.
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Ms Elizabeth Teaonui wanted to know the reasons behind the proposed bi-annual general meeting as she prefers an annual general meeting. She also suggested that Tumunui bring back advisory trustees as every Trust needs a succession plan. Mrs Daniels disagreed. She said that an annual general meeting does not give the Trust the time it needs to settle and produces results. Rawiri Daniels noted that whilst a rotational policy sounds nice, continuity is just as paramount for the Trust’s success. He suggested that we need to develop a succession plan that is inclusive and avoids electing someone afresh without nouce and experience. We have $53 million assets that need to be protected and enhanced. Peter Staite added that we do not need our trustees to be farmers. Trustees must engage good advisors who are experts in their fields such as Mr Livingston and Mr Lasike, to ensure that they make well informed decisions. If you want to be a trustee, it is your responsibility to educate yourself in matters relating to trusteeship before putting up yourself as a candidate. Furthermore, you must be honest, have integrity, and must attend trustees’ meetings. He also said that he does not believe it is the duty of 20 owners to initiate a general meeting. The trustees are responsible for calling general meetings as per the Trust Order. However, he understands it is included in the proposal as a safety mechanism. In response to Ms Teaonui’s queries, Mr Lee noted that the owners resolved at the last general meeting that the trustees call a general meeting of owners every 2 years, review the Trust Order, and develop a strategic plan. They also considered and discuss the merits of advisory trustees at length and decided they are no longer necessary. He also said that the trustees acknowledged that trustees term can no longer remains for life and they endeavour to introduce a new policy at the next general meeting. Mr William Hall said that the proposed variations ensure that Tumunui is moving forward in an orderly fashion. The proposal has long term implications. He believed there is scope in it that can be varied as time goes on. MOVED William Hall/Reema Hall RESOLVED “That the proposed variations to the Trust Order is approved” CARRIED (by voice) Immediately after the resolution has passed, Mr Wiremu Keepa got up and said that he does not agree with one of the proposals. Therefore, he asked that his objection to the resolution is noted. Mrs Butterworth, Ms Pinter, and Ms Teaonui asked that their objection is also noted.
STRATEGIC PLAN AND
Mr Lee presented and spoke to the Trust’s strategic plan and distribution policy which were on pages 24 to 27 of the booklet.
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DISTRIBUTION POLICY:
Regarding distribution, Mr Lee emphasized that the proposed kaumatua grant policy relates to 2015/16 financial year only and it is capped at $40,000. Therefore, only the first 200 applicants will receive this grant. He also noted that “a whanau trust is entitled to 1 grant”. However, after further discussion, it was agreed that this clause be removed. MOVED Robert Gregory/Elizabeth Teaonui RESOLVED “That the Trust’s strategic plan and distribution policy are received and adopted” CARRIED
MINUTES OF THE PREVIOUS GENERAL MEETING:
Copies of the minutes of the general meeting held at the Millennium Hotel, 1270 Hinemaru Street, Rotorua on Saturday 15 November 2014 had been provided to attendees. MOVED Serra Hona/Airini Hepi RESOLVED “That the minutes of the general meeting of the beneficial owners held on Saturday 15 November2014 at the Millennium Hotel as circulated be, and are hereby confirmed as a true and correct record of proceedings at that meeting” CARRIED Matters arising: NIL
GENERAL BUSINESS:
1. Acknowledgement Mr Joseph Henry acknowledged the mahi that the trustees have achieved thus far. He noted that he has just returned to New Zealand from Australia where he resided for years and he is very impressed with what he has seen today. 2. Meeting venue Ms Teaonui suggested that future general meetings are held at the maraes. Mr Kusabs noted that the main feature in today’s programme was visiting the farms and it was only logical that the meeting and luncheon were held at Tamaki Maori Village.
MEETING CLOSED: There was no other business. The meeting concluded with a karakia by Mr Keepa followed by luncheon.
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Documents

REPORTS & FINANCIAL STATEMENTS