In the late 1980s the
Fourth Labour Government, consistent with its policy of corporatising and privatising government-owned entities, looked to other quasi-commercial entities to apply the same process to. Power boards received early attention, but local government was not considered as potential owners of these and their corporatisations proceeded separately. Port authorities were considered part of local government and the Auckland Harbour Board was corporatised in 1988 as
Ports of Auckland, with the majority shareholding held by the ARA and the minority by Waikato local government. Some non-commercial assets and maritime regulation came to the ARA. The ARA at one stage looked to sell its holding in the port company but the proposal was defeated politically. The Government also wanted a more commercial arrangement for the
Auckland International Airport and it was corporatised in 1988, with the shareholding split between the Government and Auckland local authorities. Substantial airport reserves were also dispersed to the same parties. The ARA had no ongoing role, despite being the representative of the region's councils in the former joint venture with Government. In 1989 local government minister
Michael Bassett concluded a reform of all
local government in New Zealand. This greatly reduced the number of territorial councils in Auckland but did not materially alter the ARA, which essentially retained its previous functions under the new name of Auckland Regional Council. Two functions transferred to the larger territorial councils were regional roads and a role in stormwater on the isthmus. Anticipating a greater role in the region's governance and needing better accommodation for its staff, the ARC commenced acquisition of a new headquarters in Pitt St, completed in 1990. It was a controversial move, the building later criticised by an Audit Office review for being out-sized. The ARC had a guarantee from the developer of rental of the extra space but the failure of that guarantor, owned and asset stripped by Equiticorp, left it worthless. The controversy helped in creating a political justification for the subsequent separation of many of the ARC's functions. The power to corporatise local government operations as
local-authority trading enterprises (LATEs), modelled on
state-owned enterprises, was created. However this was voluntary, with the exception of transport, where council road design and delivery operations were required to be corporatised. Council bus operations were likewise required to be corporatised, with the ARC bus operation emerging in 1991 as Transport Auckland Ltd, trading as the Yellow Bus Company. The ARC studied forming its commercial operations into LATEs held under a holding company, but was injuncted by Auckland City Council in respect of the water and wastewater function and had a failure of political will in execution. Bassett's successor,
National's
Warren Cooper, took the process further. He promoted legislation requiring that the remaining ARC corporatisations take place and transferred ownership of the resulting companies from the ARC to a new short-lived body, the Auckland Regional Services Trust (ARST). The businesses transferred included the shareholding in Ports of Auckland and the Yellow Bus Company.
Watercare Services (formed 1992) was one resulting company, the largest local government corporatisation in New Zealand. The Auckland Regional Services Trust was later required to privatise the Yellow Bus Company, which was bought by Stagecoach. The ARC later recovered the Ports of Auckland shareholding when ARST was wound up, and later forcibly purchased the minority shares. Watercare did not continue ownership of the catchment lands in the Waitakere and
Hunua Ranges, taking a lease from the Council of the dam, pipeline and lake areas only. The result was the largest addition to the land in Regional Parks in the ARC's history. ==Auckland Regional Council, 1989–2010==