DCC considers writing off ORFU’s $400,000 debt

Comment received.

MichaelA
Submitted on 2012/03/09 at 2:49 pm
The following appeared in stuff.co.nz this morning:

“It’s understood, that after intensive lobbying, the Dunedin City Council is considering writing off $400,000 in debt owed in rentals for use of the Carisbrook rugby ground.”

How come I see no mention of this important little paragraph in the ODT? Perhaps the ODT dare conduct an investigation and find out who/when/why/how etc. Your audience would love to know.

http://www.stuff.co.nz/sport/rugby/provincial/6547500/Otago-rugby-buys-more-time-for-rescue

Posted by Elizabeth Kerr

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66 Comments

Filed under Business, DCC, Economics, ORFU, Politics, Project management, Property, Sport, Stadiums, Stupidity

66 responses to “DCC considers writing off ORFU’s $400,000 debt

  1. Anne Elliot

    Unbelievable if the DCC is considering writing off $400,000 in debt owed in rentals so the organisation that has worked in what seems like underhand ways, keeping racking up debt left, right and centre – not to mention question about trusts and potential inappropriate use of Lotteries funding – can just keep going, at our expense.

    I asked Mayor Cull by email if the DCC planned to keep bank rolling the ORFU and the answer was no. So what is it: Yes or no?

  2. amanda kennedy

    The ORFU have Cull over a barrel. ‘Pay up old son’, or his stadium will look like the lemon it is if it does not have a residing rugby team . And Cull has to sell to us all that the stadium is all fine and dandy. No surprise Cull caved in. He is surrounded by seven very determined men who must have a stadium that appears to be working, and the rest on council are not interested in putting their heads in the firing of ‘business leaders’ who support the stadium. They have a lot to protect, their reputations for example.

  3. Peter

    Politically, the council can’t afford to be seen as caving in to pressure from a now disreputable organisation. The council is already struggling with its public image and bailing out these clowns wouldn’t help it one jot.
    Some of the pro stadium councillors are probably doing their last term with age and incompetence catching up on them. Presumably Dave Cull wants to do another term and he owes these people nothing. They are Yesterday’s men – so why should he and his group join them?

  4. Phil

    If there’s to be a rugby team, there will be a rugby team. The ORFU doesn’t own the sole rights to supply a representative rugby team, and the NZRU has already said that they will look after club rugby. There’s absolutely nothing to stop someone else starting a representative rugby team, if the demand is there. Cut the dead beats loose.

  5. Phil

    I’m a little confused here.

    On the 2nd of March we had “…Its four main creditors include the Bank of New Zealand and the Dunedin City Council, which is owed about $400,000 back rentals for use of the Carisbrook rugby ground.”.

    That seemed to be pretty clear.

    Then today we have “The union owes the council $399,464.05. A DCC spokeswoman, who confirmed money for ground rental was outstanding…” This second article is with regard to a grant received from gambling machines. As this money can only be used for amateur sport, it can’t be for Carisbrook. It must be for rental of other sports grounds used by club rugby.

    So, my question is: Is the $400k figure being thrown around, for both rental owed on Carisbrook AND for the club sports fields ? Or are we talking about 2 seperate debts and $800k ?

  6. Russell Garbutt

    All this is even more weight for a truly independent forensic financial examination of all DCC entities including CST. I would include all the Jacks Point shambles with Delta. This Council unfortunately is now completely riddled with so much smoke and so many mirrors that all I can see are multiple smiling faces of Athol Stephens, Malcolm Farry and some shadowy figures in the background that look like Hudson, Brown, Coburn and co. It is a shambles. Not at all helped by the fact that the best mates of the DCC, the totally incompetent ORFU are clearly neck deep in some dodgy pokie fund funding. When is it all going to become too much to deal with?

  7. JimmyJones

    Don’t just cut them loose, but make sure they can never have anything to do with Otago rugby.
    Each year that the ORFU made a loss would have been the result of the board’s decisions on what income they were expecting and then deciding how much to spend that year. Sometimes the unexpected happens, but after six times in a row of getting it wrong, surely you would expect them to do something different to fix the problem. In fact their annual income has been reasonably steady and predictable with a gentle declining trend.
    A fairly smart hamster could have easily done a better job than the current ORFU board by deciding each year to spend a bit less than it expected to earn. Sub-human levels of financial skills doesn’t seem likely; and nor does it seem likely that the 6 consecutive losses were intentional, but one of these must be the cause of the problem. Either way these guys have done a great disservice to rugby and Dunedin’s renters and ratepayers.

    • Elizabeth

      Kill off ORFU and be done with it. The only thing that should fall into line is the personal assets of board members being called on to pay all creditors, and to repay charitable trusts the funds used illicitly to prop professional rugby – with accompanying court action.

      “Clearly, the Otago Rugby Football Union is trying to work with all of its creditors, I guess, to get an agreement. Read into that what you want. As far as I’m aware, there’s no agreement reached on a bail-out.” -Chris Staynes, deputy mayor

      ### ODT Online Sat, 10 Mar 2012
      Odds of ORFU survival rise to 50-50
      By Steve Hepburn
      The Otago Rugby Football Union has lived to fight on for yet another week, with the chances of survival now put at 50-50. The union has come up with a business model it believes is viable for the future, and it is talking to related parties for “things to fall into line”.
      Read more

      • Elizabeth

        ### ch9.co.nz March 9, 2012 – 6:21pm
        One more week for the ORFU
        The creditor’s sword of Damocles remains suspended over the Otago Rugby Football Union for one more week. Chairman Wayne Graham told a fervent media scrum there are enough positive signs to continue talks, keeping stakeholders waiting.
        Video

        • Elizabeth

          Told in the manner of a fudged ORFU fairy tale, by Mr Hepburn. Oh dear, ODT – not the standard of news reporting we expect.

          ### ODT Online
          Rugby: Liquidation now unlikely but still tough times ahead
          By Steve Hepburn on Sat, 10 Mar 2012
          The storm clouds may be clearing over Otago rugby. Things seemed grim, very grim, two weeks ago. The Otago canoe was up a creek without a paddle, the rapids were coming and it was taking on water. But it looks as if a bit of back-room dealing, some honest truths and realistic budgeting will see the union get over the finish line by next Friday and stave off liquidation. But it will not be a Usain Bolt-like celebration when – or if – it breaks the tape. The union is going to have make some big calls in the next few months, and the public is going to have to come to terms with some 2012 expectations.
          Read more

  8. amanda kennedy

    “……Big cities attract big sponsorship dollars. The days of competing against the financial muscle of Auckland and Wellington are over. And money does matter. It shouldn’t, but in this flawed rugby model it does…” Yawn. Thanks so much for that Mr Hepburn. But you are bit like the ODT, too little, too late. Many, many people figured this out years ago and said that Dunedin was too small to sustain a 200 million ratefunded stadium and it cannot afford to allow the fiscally challenged at ORFU to bludge off a city of only 56 thousand ratepayers.

  9. Calvin Oaten

    This is a copy of a piece I wrote 3 January 2012, which was turned down by the ODT and then the DScene. Relevant? Perhaps not.

    So, 2011 has gone but the Stadium is there in all its resplendent glory. One would be churlish to criticise the elegance of that edifice. It is, in many ways an elegant example of engineering design, well executed, and displaying some beautifully intricate steelwork. Not everyone’s cup of tea, obviously, but a unique construction nonetheless. That it was conceived, constructed and presented in such a short period is testament to the skill of the workforce employed.

    What is not so obvious is the ‘chimerical’ construct of the financial model which was devised to make the physical manifestation of the building possible. It seems that no effort was spared to bring this project about, even if it meant confusing, not only the public at large, but also it seems many of the people deeply involved. In the 12 December ODT supplement, the Carisbrook Stadium Trust chairman Malcolm Farry, stated that: “What the people need to be reminded of, is that they have been given an amenity that has been valued in excess of $220 million, and the [city council] ratepayer funding is under $100 million.”

    Right there is a conflict with the detail released to the public by the DCC on 24 November, reported in the ODT. This is what was said: “Dunedin’s Forsyth Barr Stadium has officially been confirmed as being worth $225 million. The stadium, at that value is to be transferred to Dunedin Venues Ltd (DVL), together with the DCC’s relative debt. In doing so, DVL incurred debt of $110 million.” Right there is a discrepancy over Mr Farry’s claim of over $10 million. Further, if we deduct from the $225 million the contributions made by parties other than the DCC we have: Otago Regional Council $37.5 million, Otago Community Trust $7 million, Otago University $10 million (now in negotiation, currently only $2 million being forthcoming), and Central Government $15 million. A total of $69.5 million. A true ratepayer cost of $155.5 million. The difference from $110 million (to DVL) leaves $45.5 million. This is obviously still on the DCC’s books as the underwriting of the Private Funding (PF) which was to be part of the construction budget until it was forthcoming over time until 2021. But we now know that this money is to be collected by Dunedin Venues Management Ltd (DVML) which will hand it to DVL for the purposes of servicing its debt. But if we look at DVML’s Statement of Intent we see that this money is going to total just $33 million, coming in at an average of $3.3 million per year. Now, if DVL’s debt attracts interest at 7% then the $110 million would require $7.7 million per annum. A shortfall of $4.4 million.

    In his statement, Mr Farry said that criticism from some was that the PF was for the pre sale of seating and corporate box entitlements. He said: “If they listened to us at the start we indicated that the funding from the private sector would come from donations, from purchases of naming rights, and from purchases of seats and memberships. Some in the community have said that’s not private sector fundraising, that was the sale of product. Well how else were we going to get money? I don’t know what magic trick they thought we had to get this money.” Again, an admission that, although the PF was included in all construction budgets, it was never in fact going to go there. A $45 million plus deception.

    Of further concern is the fact that DVML is in negotiations with both the ORFU and the Highlanders Franchise over joint operations in the stadium with a view to sharing costs. This has immediate concerns that the ratepayers will be subsidising the operations of both these entities. A frightening prospect. The problem as it seems, is that neither of these bodies will be able to generate enough revenue to fund their own operations. Why? Well, if we look at the conditions of the contractual agreements between the CST/DVML and the purchasers of the concessions, we see that firstly, they are only for five years with rights of renewal at renegotiated costs. That poses the real risk of defections leaving DVML’s projections in tatters. Secondly, if we read the entitlements, we see clearly that all “Lounge memberships, Deluxe Club Lounge and Designated Seat holders” have full rights to all “Scheduled Events”. These are: *all Super Rugby home matches involving the Highlanders.
    *all National Provincial Championship rugby home games involving the Otago team.
    *all International Rugby Tests held at the stadium.

    This means that both bodies will be deprived of this revenue, which over time probably amounts to the $33 million odd DVML expects to receive. (Never mind that the NZRFU by tradition takes the gate from tests. Does this mean that it will demand the equivalent of the PF component?) How then are they going to survive? Indeed, how can the stadium survive without that revenue?

    This is the conundrum facing the viability of this project, which is not being faced by any of the people concerned. Do the mayor and councillors (except Cr Vandervis) understand what it is that they have committed the people to? Have the proponents actively set about to obfuscate the position in order to satisfy their desire to “save” rugby from its bankrupt state? What of the other costs relevant, such as State Highway 88 realignment and the purchase at a questionable value of Carisbrook? There needs to be an urgent public assessment of the whole operation by independent “forensic” accountants and the people being fully apprised of the position. After all, it is they and their children’s children who will be paying.

  10. Calvin Oaten

    Another piece I wrote and submitted to the ODT on Friday, 2 March 2012. Also posted to ODT on Sat last. No show, nor seems likely. Not relevant again?

    So the inevitable has happened. The Otago Rugby Football Union is to liquidate, wind up and start again. Saddled with debts of over $2.2 million, chairman Wayne Graham says the union has no other option but to cease trading. “This is a very sad day but we have not taken it [decision to go into liquidation] lightly,” said Graham. So, he says he did not want to apportion blame for the situation, as it had come from many decisions over many years. “Owning Carisbrook had become a millstone around the union’s neck.” What? The ORFU has owned Carisbrook improvements for decades, way back in the mists of time. It was situated on Presbyterian leasehold land which the union freeholded in relatively recent times in order to free up the sale of liquor on the premises. This apparently was not permitted under the terms of the lease. We didn’t hear of any great stress over the past hundred or so years.

    So what happened? We know that in the early eighties a major rebuild of the pitch took place, turning it from a heavy muddy ground into a first class arena. No problems then. A major development of the railway end stand, the hillside end stand and the terraces was carried out. No sound of stress yet.

    Then came the professional era and the start of the problems. First the lighting towers due to the demand for night games, the escalation of paid staff and huge travel and accommodation costs. Player salaries, I understand were paid by the NZRU. Large debt incurred to build the “Corporate Boxes” which didn’t increase capacity or income, just pandering to “elitism”. By now the financial strains would be showing. Two circuits, both Super12 and provincial, to be funded. Then in 2003 the NZRU declared that Carisbrook was not up to standard for A grade internationals. Why? Because the under-stand facilities for the after match functions were not up to standard. Nor was the news rooms adequate. Right there and then the ORFU should have said, “OK, tell us what is required, we will build it and you pay for it.” That’s what any strong negotiator would do. Call their bluff.

    The NZRU needed an arena in the south capable of housing a crowd of up to 40,000 and Carisbrook could. Would it have turned its back on Otago? Think about it. So what did the ORFU do? It panicked, commissioned a report into its affairs byMontgomery Watson Harza (MWH) which was duly presented at a public meeting in the Skeggs Gallery in late 2004. Present was the CEO of the ORFU Russell Grey, DCC CEO Jim Harland and Mayor Peter Chin. The report painted a picture of the parlous state of the ORFU, by then bleeding profusely. Its debts were climbing, as were its operating expenses but no sign of pulling in their horns. Mayor Chin spoke, as did Jim Harland. Bad sign.

    Next it is announced that the DCC had formed a working party to look into what could be done for the ORFU. Why, was never explained. Then it was decided to form an independent group called the Carisbrook Stadium Trust, and Malcolm Farry was invited to chair it. Bad move. The trust quickly decided that Carisbrook was beyond redemption and the best and only course was to build a new stand alone stadium in close proximity to the University. Out with all the history, assets, capacity and location. Gone!

    In August 2006 Malcolm Farry, at a public meeting, declared that we were to build a new stadium with a capacity of 25,000 seated, 5,000 standing. It would have a roof and would cost not a cent over $188 million. Further, it would not be a direct cost to the ratepayer. If it could not be done from within existing resources, he personally wanted nothing to do with it. We all know now what has transpired. The stadium, in all likelihood will cost upwards of $250 million (yet to be confirmed), cost the ratepayer directly around $180 million and indirectly $37.5 million via the Otago Regional Council. Plus the interest incurred over what is now to be a forty year period.

    Meanwhile, the ORFU has carried on building bigger and bigger deficits, until today’s liquidation. From this we now have the stadium with no anchor tenant, only half the events, being the Highlanders (at the moment), no provincial rugby and worse, probably the evaporation of some forty million of private funding, so desperately needed.

    Ex CEO Jim Harland says the ORFU was given “every chance to be successful” and Cr Syd Brown agreed. But how can he say this when, if he had done so much as an ounce of due diligence back in 2004 it would have been plain to see that the ORFU was technically insolvent then and continuing to increase its indebtedness by the year. Where indeed was Mayor Chin’s inquiry and indeed the councillors’ due diligence? So then Jim Harland arranged for the purchase of Carisbrook for the sum of $7 million, and his reasons, he said when asked, was to secure the ORFU as a viable anchor tenant for the new stadium and secure some valuable industrial land for the city. Never mind that he had just removed around 3.6 hectares of industrial land to make way for the stadium.

    So what have we now? The ORFU leaving a whole raft of unsecured creditors, including the DCC, walking off, expecting to reinvent itself, seeking support from the community. This would have to be the ultimate in ‘hubris’, and rubbing salt into the wounds of so many small traders and ratepayers. To add insult to injury, Malcolm Farry insists on repeating the mantra that the CST delivered the stadium “on time on budget”. Even if it was true, just what the hell is the point of that? These people have collectively destroyed rugby for the ordinary people, destroyed the citizens’ treasure to the tune of over $16,000 per ratepayer, and left a giant stadium with no foreseeable hope of generating revenue to cover a fraction of its costs. We have the ‘Stakeholders’, DCC councillors, ORC councillors, the CST members, DCC staff and the ORFU board, none of whom have shown an ounce of contrition. Shame on you all.

  11. Anonymous

    Finally, we get an audit of The Trusts Charitable Foundation.
    This should get interesting.

    http://www.odt.co.nz/news/dunedin/201149/inquiry-orfu-funder

  12. Peter

    Calvin. It’s interesting to see, and wonder, how the media in our town works. The ODT, when it sets its mind to it, can do a good investigative story. They, at times, do allow a variety of opinion pieces that tackle thorny issues, including your excellent pieces, Calvin. At other times they drop the ball. Bev has spent considerable time providing some ‘juicy stuff’, backed up by verifiable sources, taken the trouble to supply extra information/explanation, and then….nothing. Sometimes not even a ‘thank you’ or acknowledgement. At the moment the ODT has in their possession information that has been acknowledged as being ‘very interesting’. The last two days has witnessed a very thin, scrappy paper so it is not that they are overwhelmed with news. What’s up?
    I can appreciate that a journalist has to pump out different stories every day on a variety of issues. Information presented has to be tidily set out to help them get their head around that information. Sometimes a story does have to be backgrounded more, but when that background is fully documented, and laid out on a platter, it makes you wonder what is going on when nothing happens. That is where interference from the editorial team comes in, I think. Nervous nellies who don’t want to cross some of the nasties in the Tartan Mafia, I suspect. The nervous nellies just need to get balls and remind the information suppressors of the democratic concept of freedom of information and the press.
    At least both the ODT and D Scene do have journalists in their midst that are good at their jobs. A good editor should let those ones rip.
    One other thing. I wish both papers would get over this thing that if the other publishes first, they won’t do anything themselves. They are not always consistent in this because there are big stories that are widely covered by all media over an extended period of time. Each media outlet can do their own angle on the same information. Also the readership of the ODT and D Scene is not exactly the same, plus one is daily, the other weekly.

  13. Hype O'Thermia

    When D Scene stories are taken up by other Fairfax papers e.g. Southland Times our local daily is – pushed? shamed? – into doing the same story.

  14. Peter

    That’s true at times. The danger of doing nothing is the harm it does to the paper’s reputation.It gets to the point of just ignoring the paper because you know they will do nothing. They become irrelevant and no self respecting journalist/paper wants to become an irrelevancy.

  15. Hype O'Thermia

    Do they (Auditors) automatically do the fine-tooth comb thing, or are the terms of investigation constrained, either by themselves or from elsewhere? IRD investigations are feared even by the squeaky-clean innocent – does their same standard apply here?

  16. Calvin Oaten

    Anyone read today’s ODT Editorial? Unbelievable! He picks up on the SST’s claim that the DCC’s debt per capita sits at $1920 and repeats it verbatim. Jeez!! Don’t these people do any due diligence, and isn’t it peer reviewed before going to print?
    Another way to look at this is to take the $1920 per capita quoted and multiply it by 120,000 (population) and we find $230.4 million debt. Divide that by 53,000 (ratepayers) and we have $4,347 each.
    Now wouldn’t you think that before going into print that the editor of the ODT would query the $1920 figure, knowing from any documentation that a total debt for the city and DCHL at just $230.4 million is plain ludicrous? Good God, don’t they even read what they print. The DCHL info was in their paper so recently that it hasn’t even wrapped any fish and chips. The current LTCCP
    has been on their table since July 1st last at least.
    This is not only lazy misleading journalism, but just plain pathetic.

    {see Elizabeth’s comment on a more recent thread -Eds}

  17. Calvin Oaten

    Peter; I hear what you say about our local news media. In the case of the ODT it is difficult to believe that the journalists / reporters are not capable of doing the same due diligence as we can. One can only come to the conclusions that it is a result of either incompetence, laziness, personal bias or direction from editorial policy. Whatever, in this particular instance of the intermingling of the city’s financial standing, together with the intertwining of rugby’s fate, the ODT is lamentably wanting as the citizens’ advocate. Its prime function, I would have thought as a community newspaper, would be to inform and outline all sides of the issues at stake, to enable the citizens to come to their own conclusions. In this, I am sad to say it fails on all counts.

  18. Calvin Oaten

    Elizabeth; who’s the current chairman of the Gambling Commission? You guessed it, Peter Chin. But hey! wasn’t he our previous mayor? Didn’t he cast his lot in favour of the stadium? Would that not suggest that he should be even more vigilant over the activities of the ORFU re proceeds from ‘pokie machines’? Almost a case of conflict of interest, I would have thought.

  19. Peter

    Calvin. Always difficult to know where ‘incompetence, laziness, personal bias or direction from editorial policy’ begins and ends when you don’t work there. Probably a mix of all of them. It must be frustrating for those who work there and still believe in the nobler goals of their job.
    I agree the ODT has failed in its duty to fully inform, and warn, thereby protecting the interests of the wider community. It is increasingly clear the ODT has come out on the wrong side with its support of all things rugby. The stadium’s finances are in a mess. The ORFU is essentially bankrupt and dodgy in its dealings with funders. Hopefully, they can make amends, but I’m not banking on it.
    As I say, with all that is unfolding, it is too late to continue to shut things down. Too many now know, from outside the province, what is going on here in our little banana republic. The pack of cards is collapsing.

  20. Ro

    I think Peter Chin’s term ended a few years ago. These are the members July 2011: “New appointments to Gambling Commission/Minister of Internal Affairs Nathan Guy has announced two new appointments to the Gambling Commission./Abigail Foote, a Christchurch lawyer brings legal expertise, governance and management experience to her role./Russell Bell, a chartered accountant from Wanganui has a strong background in risk management and auditing./These two appointments bring the Commission to its full complement of five members. They will join Chief Commissioner Graeme Reeves, and Commissioners Paul Stanley and Lisa Hansen…./The Commissioners’ terms are for three years.
    http://www.national.org.nz/Article.aspx?articleId=36630

    I wonder if Lisa Hansen is related to Judge John?

    {Link added. -Eds}

  21. BlueBottle

    Tomorrow (Wednesday) there are meetings of Council and the FSD. The Council meeting is the one that was postponed from Friday because the draft long term plan failed its audit. It is still not good enough and should not be approved.

    The meeting starts off with a secret session to decide how generous the ratepayers will be towards the ORFU. The terms “bail-out” and “blood-sucking leeches” definitely won’t be mentioned in the press release.

    The new draft long term plan tells us that there is a report to be presented to a committee about the governance arrangements of DVL and DVML (see LTP page 5).

    It turns out that negotiations to sign the stadium “venue hire agreements with major event owners” have failed, but we are told the LTP is written as if the agreements are signed.

    The Private Sector Funding is now called (p5) Private Sector Debt. It isn’t “private” but it is “debt”, so that’s an improvement. Thanks to Audit NZ for that.

    • Elizabeth

      ### ODT Online Wed, 14 Mar 2012
      DCC may write off ORFU debt
      By Chris Morris
      The Dunedin City Council is considering a debt write-off to help rescue the Otago Rugby Football Union, but only in return for a deal that seeks to secure the Forsyth Barr Stadium’s financial future. The package would entail the ORFU’s $399,464 unpaid bill to the council being scrapped, in return for a three-year programme of top-tier All Blacks test matches at the stadium, including a Bledisloe Cup clash against Australia.

      The council – not the ORFU – would receive the proceeds of the North-South charity rugby match to be played at the stadium in June, and the council wants a long-term venue hire agreement tying the Highlanders to the stadium. The Otago Daily Times understands the deal has already been agreed to by the New Zealand Rugby Union.

      Read more

      Other news
      http://www.odt.co.nz/sport/rugby/highlanders/201287/rugby-no-progress-privatisation-plans

      ****

      What if? Corollary: Dave Cull is not coming back as mayor for a second term.

  22. Hype O'Thermia

    As I understand it, hire of the venue, if it were to be charged at the true cost, will cost more than the income from ticket sales unless over the next decade’s rugby – and particularly paying to watch people playing rugby not on TV – will have to return to olde tyme popularity.
    If the council wants to burden ratepayers more why don’t they forgive my rates in perpetuity? Sure it wouldn’t be fair to the rest of you but hey, tough luck folks, harden up and stop whining.

  23. Anonymous

    Greater Dunedin block just lost my vote in perpetuity.

  24. Peter

    Quite simply, if the NZRFU don’t want to bail out the ORFU, why should the ratepayers of Dunedin? Where are the wealthy Otago benefactors now?
    This is a rotten deal. The ORFU welch on their debt. We pay money for tickets to watch a ‘charity game’. That ticket money goes back to the ratepayers. Essentially, we pay twice for our custom. What kind of crazy money go round is this?
    As is likely, a majority of councillors will vote for this absurdity.
    If I was a BNZ customer I’d be closing my account if they forgo the debt owed to them. Their customers will pay, no doubt, through some other means.
    Makes you sick how the DCC pursued STS for their miniscule court costs debt after they lied to the High Court in the first place. And we were paying off that debt as good citizens!

  25. Hype O'Thermia

    STS indeed, true.
    What I’ve been wondering is this: how many other debtors get let off this easy? Parking fines, yes, sometimes, if you write in with a good reason why you couldn’t get back to your car in time. Any other examples, readers, please?

  26. Peter

    A comment from the Editor at the end of a post on the ODT online edition.
    ‘Editor- We agree. The table will be amended. Go the mighty Highlanders.’
    In case any of you were in doubt about the ODT’s support for anything rugby and anything that can justify propping up things rugby here in Dunedin/Otago. Entitled to his opinion, but a shame he is not interested in getting more stadium scandal news out. Trickle some stuff out – to appear to be creditable as a paper – hide the rest. These kind of embedded journalists need to see daylight instead of dwelling up dark back passages.

  27. Calvin Oaten

    Why the shock and horror? This whole indecent liaison between the ORFU and the DCC has been in place since the time the MWH report was announced in 2004. Ever since, it has been driven with headlights full on and sirens screeching. Why the masses couldn’t see or hear of this impending crash is a number one mystery. If Cull and Council does this afternoon what I think they will do, then the casualty count among the proletariate over the years will be huge. Gone will be all services, up will be all compliance costs, gone will be all meaningful development. For what? RUGBY!!! Question? Can or will that same proletariate support and attend the bread and circus gladiatorial events? Emperor Cull has given the thumbs down for them, not the losing contestants as protocol dictates. He has got it all wrong. A day of infamy for this fair, broken city.

    • Elizabeth

      ODT Online analyst Rob Hamlin offers his thoughts on the possible outcome of the Otago rugby debt crisis. The blog was written before today’s revelation that the Dunedin City Council may write off the Otago Rugby Football Union’s debt.

      ### ODT Online Wed, 14 Mar 2012
      Opinion: Blog
      The Analayst
      ORFU ‘rescue’ – amber light for caution
      By Rob Hamlin
      This last week Councillor Chris Staynes made two interesting comments relating to the fate of the ORFU: “As far as I’m aware, there’s no agreement reached on a bail-out.”, and when asked if any sort of bail-out by the council was on the cards, he said that that was “speculation – nothing more than that”.

      DCC may write off ORFU debt

      Councillor Staynes’ first comment is not a denial that bail out negotiations are going on, and does suggest that they are heading towards an agreement of some sort. The second also indicates that the ratepayers who are likely to end up funding any such agreement will be the last to know any details that would replace ‘speculation’ until it is too late to moderate any agreement that is reached. Mr Graham, the chairman of the ORFU, has also said that the negotiations are ‘complex’. I have no doubt that they are…

      The white knight that will gallop to the ORFU’s rescue is unlikely to be the DCC itself, but rather Dunedin Venues Management Ltd (DVML). In a previous article I noted that it is an offence under the Companies Act for directors to continue to allow a company to trade if they know it to be insolvent. While the publication of the six monthly financial statements of this company has been delayed, there appears to be a pretty universal consensus that when they are eventually and reluctantly disgorged, they will reveal a multi-million dollar loss for the period.

      Read more

  28. amanda kennedy

    Notice no mention of removing the board members of the ORFU for their gross incompetence. So are we to have the same fiscal incompetents on the board and coming back in a year with their hands held out to Mayor Cull for more ratefunds?

  29. amanda kennedy

    No. That would be too embarassing for important members of the community, wouldn’t it? ORFU board members responsible for the ORFU financial mismanagement must be able to continue as if they are the Great and the Good genius ‘businessmen’ they think they are.

  30. Calvin Oaten

    Message for Mayor Cull and Fellow Councillors: ‘Beware the Ides of March’.

  31. Anonymous

    Mayor Cull is playing both sides:
    http://www.nbr.co.nz/article/i-dont-care-about-orfu-mayor-cull-subbed-ja-p-112782

    “It is important for that Government to fall, Minister,” said Sir Humphrey. “It is equally important for our dagger not to be found in its back”

  32. Peter

    So let’s get this straight. Cull claims he isn’t worried about the future of the ORFU. He just wants to get our $400k back. So his council is about to bail out the ORFU by forgiving them THAT particular debt.
    What an excellent example of muddled thinking from the man who promised a more analytical, problem solving council team.
    They will vote for what is basically blackmail, gangster money to help the ORFU out – again. As if a $250m stadium wasn’t enough for the rugby fraternity. Any councillor who votes for this deserves to be pilloried by the public.

  33. Hype O'Thermia

    If it weren’t a stadium but a commercial building of that size how would the price look? Just wondering if it has resale potential, to be refitted for another purpose since stadia are (I’m sure I heard someone mention this once or twice) ruinously unprofitable this side of Ursa Major.

  34. Phil

    There’s quite an interesting article about that subject, Hype O’Thermia, about how one values a stadium in terms of resale. I’ll try and dig it out. You can value it as a stadium, which invloves looking at the demand for stadium purchases in the area. Not very high in our case, obviously. You can value it as another purpose, such as a shopping mall, but then you have to deduct the refit costs from that value. Either way, using the construction cost as a reference of value is incorrect.

    I read an interesting article not so long ago. A study of 30 recently built stadia in the US revealed that 27 of the venues had generated no additional nett economic value to the community, while the other 3 had actually had a negative nett economic effect. The study further supported the results with the following observation which I hadn’t really considered before. In order to retain the professional sports team upon which the new stadium relies, local authorities have to employ subsidies, rebates, loans, rates relief etc in favour of the professional sports team and the venue. Sound familiar ? The resulting increased debt and reduced income added, on average, 40% to the total cost of building the new stadium.

  35. Hype O'Thermia

    What a shame none of those facts was available before the Council vote-bunnies positioned themselves in the cross-hairs and chorused “Take us.”
    Hang about though, since I’d heard about overseas stadium “difficulties”, does that paint me psychic?

  36. Anonymous

    I’ve never heard before of a significant number of tickets being given away…for a FUNDRAISING match…

    • Elizabeth

      Woops, fly the guys in and no-one keen to fill seats much. Classic dickhead stuff, DCC thinking this would be a money spinner when the signs were the signs. Is this how we do contempt or apathy, people? Or plain old study break and exams.

      It’s like the Days of Our Lives hourglass, dollars not sand. Leeching. All the time.

  37. Anonymous

    They’re strange bedfellows but that is what they are. The new Our Stadium Mayor Dave Cull is going to bend over backwards for rugby because this council is nothing more than the willing object of desire in a cesspit of snakes.

  38. ormk

    People who want to see proper investigation and accountability for the stadium debacle are in no way negative. We are positive.

    To be fair and intellectually honest it would be wrong to say that rugby clubs giving away hundreds of tickets to a fundraising game were being negative. I guess at least they are hoping people will turn up and watch their game. But it sure as hell isn’t a positive sign of support. It is a neutral $0. If the people who like rugby can’t even show positive support …… well that speaks volumes. The fact is – there aren’t many people in Dunedin who support the stadium project the way it happened.

    I’d actually quite like to watch the odd game of rugby. But no way am I having anything to do with that stadium while it remains a symbol of injustice. In fact I might make a point of travelling up to Christchurch for an ABs game. To me its not about being anti rugby. Its being anti corruption. That is never negative.

    • Elizabeth

      Your point is well made, ormk.
      Dire rather than neutral though if DVML must absorb the losses on top of what has already been calculated for the stadium’s six months of operation, which we need to double for the twelve months. Ratepayers and renters stung again.

  39. Pedant

    Is there any chance of this North vs. South game actually making a profit?

  40. Phil

    They are giving away tickets because they know that the rugby baying public are that stupid. Suddenly they can announce that there aren’t many tickets left to purchase and the drunken hoardes will come streaming out of the Octagon bars to snap up the final “hot demand” tickets. Then the stadium can proudly announce to Cambell Live that the event is another sellout, just like Elton John.

    • Elizabeth

      Tweet (4:03 PM – 7 Jun 12):

      @ForBarrStadium Awesome news fans- the Web Ellis Cup is coming to Dunedin for the #northVsouth match this weekend! Make sure you are a part of the action :)

      • Elizabeth

        ### ODT Online Fri, 8 Jun 2012
        Webb Ellis Cup coming to South
        The trophy that became a fixation for the country last year will be on display at the North-South rugby match. The Webb Ellis Cup, the trophy of the World Cup, will be at Forsyth Barr Stadium on Sunday. After some public pressure, the New Zealand Rugby Union has decided to send the trophy south.

        SUNDAY
        The cup will be on display in the South Stand, on the level two concourse between 12.15pm and 1.45pm.

        Read more

  41. Anonymous

    Do you hear this Mr Orders? It is the sound of one hand clapping and the other slamming into my forehead. Smart, very smart but now I know where you stand on the OR F. U.

    ‘A history of legal threats and unpaid bills will not stand in the way of a “co-operative” relationship.’

    When was the threat “history”? The photo is clever though but you already knew that, didn’t you Mr Orders. Nothing like the image of a strong woman standing in front of bunch of old boys – half of them looking a bit prissy – to promote the “get in behind it” philosophy.

    Or some such communications department shite we’re paying to have force fed back to us.

    Clap. Slam. Laugh. Cry. Thanks a LOT.

    http://www.odt.co.nz/news/dunedin/212089/observer-welcomed-orfu-fold

  42. Anonymous

    One of the people who absolutely should not have been given this position. What were they thinking. Oh that’s right. They weren’t thinking. And the farce rolls on.

  43. ormk

    More beers and pies anyone?!

  44. Hype O'Thermia

    Brilliant choice – who’s more reliable at the important stuff? Supporting/believing in/hatching expensive wastes of time and money, ignoring the inconvenient bits that don’t fit the agenda – any other “previous experience and qualifications” I’ve missed?

    • Elizabeth

      This person is someone I rarely comment on as I’m not in the fan club. Paul Orders on the other hand might be (is) – but lacks choice of top order managers available (this particular club has zero membership), then there was Athol. And there you have it. Incompetence is all the craze at DCC, nowhere louder than here and at communications and marketing, for now. Not sure a doctorate in psychology helps.

  45. Anonymous

    Nor her understanding of a budget. But she sure has that DCC management philosophy down pat on telling its people to suck eggs. No budget is too big to bust for rugby and by golly you all better suck it up or face more advertising campaigns from the marketing dept.

    How did the chicken cross the road? It got in behind the stadium.

    And the chicken rejoiced!

  46. A big test for Mr Orders is what action he takes to hold Council staff to account for the failings detailed in the PwC report. If there is no accountability for millions of dollars of unapproved spending, then he will lose all credibility.
    I [note] another example of DCC negligence, the sea is very close to taking out the sand-track just North of the St Clair Esplanade. Past Mayors, Town Clerks, and City Engineers will be turning in their graves.

  47. Hype O'Thermia

    “Doctors predict rise in numbers comatose with excitement.”

    • Elizabeth

      Our newborn baby numbers are down. Our sunshine hours are up (autumn). Rugby isn’t prime mover any more.

  48. Anonymous

    Been somewhat funny this week. The rugby fanatics were baffled Tuesday and Wednesday to learn the North vs South game was on this weekend. Then rugby promoters actually got busy yesterday and today. Almost like they realised they should be seen to do something. The line up is weak and the offers smell desperate. It’s all seemed a bit lame and I suspect is reflection of their attitude towards fundraising – they really don’t give an arse about it.

  49. Phil

    The DCC were sold a dud by the NZRU from the start. In order to secure the financial backing they needed. That being said, it’s pretty obvious that the DCC either neglected, or chose to ignore, their due diligence responsibilities. Anyone who looked into that fundraising match offer could have seen that the timing of the match, being smack in the middle of the Super Rugby and Test match season, meant that no players worth the price of admission would be playing. I don’t blame the stadium for this but someone should have stepped in and demanded that this match be held at a time when team selection would not be an issue. Could they not have held it over until February of next year ? Prior to the start of the season when every player in the country would have been available. Better to get some money later than no money now, I say. Unless ticket sales (and I mean REAL ticket sales, not discounted student prices or radio giveaways) skyrocket, this match will likely generate a further loss for the DCC. Maybe the DCC never really cared very much about getting any financial return and merely proposed the match in an attempt to appease the public. Who knows, but for whatever reason it’s a planning disaster.

  50. Anonymous

    Let’s get Ms Bidrose on the job – no matter how bad the budget blowout, Dr Bidrose can still talk you into buying a goose egg painted gold.

  51. Anonymous

    Dr Bidrose and Mrs Mains in combination would be devastating.

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