The owner of a Government-contracted emergency housing motel claimed she was unaware up to 100 homeless were living on her property until she read it in the newspaper.

Greet van Der Helm has begged commissioners to decline applications for resource consent for her motel and 12 others to allow them to be contracted to house the homeless for the next five years.

A hearing is continuing this week at Arawa Park Hotel where three independent commissioners will decide whether the Government can continue using the 13 Rotorua motels for contracted emergency housing.

The use of motels for emergency housing is a breach under the District Plan as they are consented only for short-term visitor stays. The Ministry of Housing and Urban Development has applied to the Rotorua Lakes Council to grant resource consent for the change of use.

The Alpin Motel is one of the motels but its owner claimed she was unaware because the previous deal was struck between the Ministry of Housing and Urban Development and the motel's lease owner.

Van Der Helm appeared at the hearing yesterday and was represented by her property manager Joanne McCracken APL Property.

McCracken said her client was the owner of the land and buildings and owned other buildings nearby on Sala St.

She said there had been no consultation with the property owners which was a "fundamental flaw" of the process.

She said the owners never contemplated when arranging the lease there would be a change in the type of accommodation the lease was for, from temporary use of a few days to several months.

"People have come with their dogs, cats, a rabbit - I kid you not - a bird and all their possessions they had in their house. That arrangement is entirely inappropriate. The stress these people have been under is evident in their behaviour."

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McCracken said the "tenant", or the lease owner, was gaining with "extraordinary windfall amounts" from its contract with the Ministry of Housing and Urban development but the owner of the land and buildings was not aware.

Addressing the panel directly, Van Der Helm said she did not live in Rotorua and had no idea.

"It was very stressful. We found out through the newspaper that the whole motel was full of these people. It was not very nice."

Commissioner Greg Hill asked McCracken if there was any case law that allowed the property owners to say no, to which she said that would have to be another legal process.

Rotorua Racing Club chief executive officer Damien Radesic told commissioners the club owned the land Emerald Spa was on and it had been asked to give consent to the change of use.

"We will not be providing that consent, the answer to that is no therefore this application can go no further."

Panel chairman David Hill replied: "Thank you, I don't think there is any doubt about your position."

Homeless motel tenant Kane Alexander. Photo / Andrew Warner

'Psychological warfare'

Kane Alexander, a homeless man living in contracted emergency housing, addressed the panel saying rules were put in place when motels became contracted that made it more stressful, for example not being allowed visitors.

"I noticed the mental abuse, people's health was going down and they were getting sicker because of mental abuse. They were living with discrimination, violence, bed bugs, and other contamination issues ... "

He said contracted emergency housing was sold to them as being family-orientated but he did not find it was better.

He said his son suffered from asthma and his condition got worse because of the cramped conditions and things such as no extractor fans over cooking facilities.

"It is hard to breathe sometimes."

Homeless motel tenant Kane Alexander. Photo / Andrew Warner

He said he presented a doctor's letter to his housing providers but his living conditions did not change.

He said there was no support and those in that situation were not well educated and often did not have access to the internet.

"Because of the mental abuse that was happening, you felt the pressure building up. People were doing things out of the ordinary and things like fires started to happen."

He said rules were continually changing and people did not know where they stood. He described it as "psychological warfare" because those in power had information about them that could be used against them.

Commissioner Sheena Tepania thanked him for addressing the panel because he was the first person they had heard from who was actually living in the motels.

Merepeka Raukawa-Tait addresses the panel. Photo / Andrew Warner

Former Rotorua Lakes councillor Merepeka Raukawa-Tait addressed the panel and said the situation was a "bloody fiasco".

She said the council had tried to tell "Wellington" not to "herd" people into motels but it didn't listen and their concerns were "overlooked".

"And it's come at a great cost to our city."

She said the Government's action had "created a monster" and it had not listened to Rotorua's concerns.

"This has been a bloody fiasco ... The Government has trampled on the mana of Te Arawa, the city leadership of Rotorua and the citizens of Rotorua ... Our reputation has been tarnished all because Wellington would not listen to the city of Rotorua and it's rather sad we are in this situation today."

She said taxpayers would have to bear the brunt in future with impacts of long-term motel families in terms of young people ending up on the "treadmill to juvenile hall", pressure on mental heath services and long-term unemployed.

"When you herd people into accommodation like that surely Wellington would have known this would have been the outcome."

She said there were wrap-around services employed but in her opinion, they "are not adequate" because professionals were required for those with such high needs.

Raukawa-Tait supported her sister, Donnarae Raukawa Doughty, who gave evidence about how the unruly behaviour from the Apollo Motel on Tyron St at Whakarewarewa had impacted her art gallery.

She gave several examples and said some artists weren't comfortable displaying or leaving their one-off pieces at the gallery.

Rotorua Residents and Ratepayers' Association chairman Reynold Macpherson. Photo / Andrew Warner

Rotorua Residents and Ratepayers' Association chairman Reynold Macpherson told commissioners he "blew the whistle" on the Ministry of Social Development busing people into Rotorua for emergency housing last year but his comment was silenced by the "power bloc" at the council.

He said population figures compared with Rotorua's emergency housing numbers alone indicated Rotorua was overcompensating for the crisis.

He said the Ministry of Social Development's study into where the homeless had come from, released earlier this year - showed two-thirds of those in emergency housing at the time were from Rotorua - revealed a "corrupted methodology" because it "reclassified people as locals" based on where they had lived in the past 30 days.

He described it as "devious trickery".

He said locals wanted to see the "homeless industry" dismantled.

"I beg of you, help us kill off the central government homeless experiment in Rotorua and give us back our once prosperous and once beautiful community of Rotorua."

His submissions were met with a round of applause.

Rotorua real estate agent Jodi Ratahi. Photo / Andrew Warner

Rotorua real estate agent Jodi Ratahi told commissioners she loved Rotorua and looked forward to the Golden Mile on Fenton St being once again, and she feared if consents were granted for another five years this would be prolonged.

She said there were so many stories of people being bused into Rotorua. She heard of one woman from Auckland with 11 children who were put into a motel unit each - at the cost of $1200 a week for each unit.

Airflo Holdings Ltd director Donald Atkinson. Photo / Andrew Warner

Airflo Holdings Ltd director Donald Atkinson described the Covid response to provide motel accommodation for homeless as a social experiment that had gone "terribly wrong" and should be stopped as soon as possible.

He said told the panel the Government had come into Rotorua and completely disregarded all pleas from its citizens.

"To date, it has occupied motels illegally, and now it wants to legitimise this occupation. I strongly oppose this application and if granted I will appeal the decision."