STS Appeal thrown out +Decision +Affidavits

### Channel 9 Online August 24, 2009 – 7:46pm
Stop the Stadium get[s] bad news regarding its appeal

Stop the Stadium today received the news they didn’t want to hear regarding the appeal of their case, arguing that the Dunedin City Council breached the Local Government Act by going ahead with Forsyth Barr Stadium. The Court of Appeal released its decision this morning, and stated that it was satisfied there was no breach of the Act by signing a construction contract.
Video Link (01:49)

****

### ODT Online Mon, 24 Aug 2009
Court rejects bid to stop stadium

Stop the Stadium’s bid to block the construction of the Forsyth Barr stadium has been thrown out by the Court of Appeal. The court has also awarded costs to the Dunedin City Council.

The court said in its decision released this morning it was satisfied the council had not acted contrary to the [Local Government] Act when signing the construction contract.
Read more

The Decision

Affidavits (PDF, 2.4 mb, new window)
Jim Harland and Athol Stephens’ Affidavits

****

### TVNZ News Published: 11:19AM Monday August 24, 2009
Dunedin stadium appeal rejected
Source: ONE News

Dunedin’s new covered stadium has cleared its final hurdle. The court of appeal on Monday morning rejected a legal bid from the city’s Stop The Stadium group to pull the plug on the $200 million project. The court ruled the project’s costs have not increased significantly from those set out in the council’s long-term plan.

“I think I would have felt very sorry for Stop the Stadium if they had won this because they would have been crucified,” says Malcolm Farry, the Stadium Trust chairman.
Read more

****

### RNZ News Updated at 12:18pm on 24 August 2009
Dunedin stadium opponents lose appeal

A Court of Appeal bid to prevent construction of a new stadium in Dunedin has failed. In April, the group Stop the Stadium unsuccessfully sought a High Court injunction, claiming that changes to the project’s financial structure would increase costs for Dunedin ratepayers.

Earlier this month the group’s lawyers told the Court of Appeal that the cost of the stadium’s construction was significantly more than the figure earlier included in the plan sent out for public consultation.

However lawyers for the Dunedin City Council said if further consultation was ordered, it would kill the project.

The Court ruled on Monday that the cost increase is not significant and the Dunedin City Council has not breached legal requirements in entering a contract to build the stadium.
RNZ Link

****

### NBR Monday August 24 2009 – 12:05pm
Green light for Dunedin stadium
NBR staff

Dunedin’s new rugby stadium will go ahead after the Stop the Stadium Society had its appeal against the city council dismissed today. The Court of Appeal has awarded costs to the Dunedin City Council.

The Stop the Stadium Society argued that the council had breached section 97 (2) of the Local Government Act 2002 when it decided to proceed on its plans to build Carisbrook’s replacement.
Read more

****

### NBR Monday August 24 2009 – 01:53pm
Court of Appeal dimisses allegations against Dunedin City Council
By Kelly Gregor

Dunedin’s new rugby stadium will go ahead despite legal action taken by Stop the Stadium Society that raised concerns on how the council would fund the multi-million dollar development.

The society had its appeal dismissed by the Court of Appeal today and costs have been awarded to the Dunedin City Council.

A local government bylaw, section 97 (2), was at the heart of the dispute.
Read more

****

### TV3 News Mon, 24 Aug 2009 12:58P.M.
New Dunedin stadium on track after appeal thrown out
By Dave Goosselink

The multi-purpose stadium being built in Dunedin remains on track, after a bid to block its construction was thrown out by the Court of Appeal.
Read more

### TV3 News online 24 Aug 2009 3:43p.m.
Comment by Phil

……and so the arms race of the 21st century continues, carried along on the back of the long suffering rate-payer. Who can build the biggest and best sports stadium regardless of cost and little regard to those who have to pay for it.

152 Comments

Filed under Stadiums, STS

152 responses to “STS Appeal thrown out +Decision +Affidavits

  1. I can honestly say that I had no idea which way this was going to go. The legal arguments seemed to have some level of validity, but then I am not a member of the court of appeal.

    I guess before long we’ll have the full judgement to pick through.

    • Elizabeth

      Paul – The decision is available for download above at the post (18 pages).

      Oh dear
      page 4 [11] of the Decision reads: “…the Council’s preferred option for a new stadium on a site in Awatere Street, Dunedin…”
      It would help to get the street location right.

  2. There goes another appeal…

  3. Whops sorry was having coffee and reading with iPhone, missed the link.

    Right deep breaths, legal gobbledegook coming up.

  4. David

    So the decision in summary is –

    – yes, the stadium will cost council significantly more that what ratepayers were told in the long term plan.

    – but if the construction cost to council is ignored, and the council uses an average 20 year interest rate that is 2% less than the one they used previously (how they know what interest rated will be in ten or fifteen years I have no idea), then the cost to council for half the stadium is only $204m (only $6m higher, so not significant).

    • Elizabeth

      STS v DCC Decision:

      Costs
      [60] Counsel were agreed that costs should follow the event. We award costs to the Council for a standard appeal on a band A basis.

      ****

      ### New Zealand Law Society online
      A new costs regime in the Court of Appeal
      By Colin Fife*

      THE Court of Appeal (Civil) Amendment Rules (No 2) 2008 come into force on 1 July 2008.

      Under the new costs regime, costs awards will reflect the complexity and significance of an appeal. Proceedings will be classified by the court as being either “standard” (an appeal of average complexity requiring counsel of skill and experience considered average in the Court of Appeal) or “complex” (an appeal which because of its complexity or significance requires senior counsel): see the new r53A(a) and (b).

      Costs in the Court of Appeal will now be calculated by reference to an appropriate daily recovery rate, which is linked to the current rate prescribed by the High Court Rules.

      As in schedule 3 to the High Court Rules, the new Court of Appeal costs rules divide proceedings into steps and assign a time allocation for each day or part-day. For example, preparation of case on appeal is allocated as one day, while preparing for and attending a case management conference is 0.3 days.

      The assessment of costs for a particular step is calculated by applying the appropriate time allocations (set out in the new schedule 2). There are two bands in the new Court of Appeal regime, not three as in the High Court.

      The time allocations for each step are listed in two bands according to the complexity of the particular step: band A, if a normal amount of time for the particular step would be reasonable in the case, or band B, if a comparatively large amount of time for the particular step is considered reasonable.

      A costs award will be for an amount equal to the sum of each step in the proceeding at the appropriate daily rate, plus any reasonable disbursements.
      Read more

      *Colin Fife is a judge’s clerk at the Court of Appeal.

  5. Adrian

    I’m happy enough to put a bottle of Tatinger in the fridge to celebrate tonight. It’s not only the correct decision, it’s one that will be a watershed in the regeneration of Dunedin. As to a point raised by David in another thread, I would expect that the disgracefully run-down and dilapidated area surrounding the new stadium will now attract significant private investment. That alone would be transformative.

  6. David,

    I hope you have downloaded the decision (very small pdf) and read it.

    “We are satisfied on the evidence presented to us that the capital contribution to be made by the Council to the Stadium is greater than that projected in the 2008 long-term plan.

    But we are also satisfied on the evidence before us that the total cost to the Council is not significantly increased from that projected in the 2008 long-term plan, nor is the average cost per ratepayer.”

    The judgement states “the total cost to the Council is not significantly increased”. It couldn’t be any clearer than that.

  7. David

    Paul – yes I’ve read the decision, and as it says, the court recognised there was a significant increase in costs to council to construct the stadium, but if the 20 year interest rates estimate is dropped by 2% then the long term cost only increases by $6m.

    So it all hinges on hypothetical interest rates in the years from 2014 to 2030, which of course no one has any idea of.

    If the court is to be correct, then those interest rates need to average no higher than 7.47%

  8. Exactly, interest could be 4.5% or 18.5% – but that is life.

  9. David

    Adrian – The area around Carisbrook has not had significant private investment, and numbers of people going to Carisbrook just a few years ago were significantly greater than what is forecast for the new stadium.

    With the city in serious debt until 2030, we can look forward to regeneration starting again after then.

    You don’t seem to understand that regeneration would rely on numerous projects that generate MORE income, rather than a single project that loses money and creates a generation of debt.

    It’s like having a 20 year student loan for a career that you can earn from 12 days per year.

  10. I don’t know there is plenty of evidence of single developments encouraging further development. I saw evidence of this all over Vancouver over the past decade of living there.

    Once again it is not written in stone that this development will operate at a loss and that there won’t be regeneration of the area. If you believe so, could I please borrow your crystal ball, I have some lotto numbers I want to see.

  11. David

    Paul – your analogy between the stadium success and lotto has a lot of merit.

  12. Adrian

    David, that’s because nobody in their right mind would want to live near a decayed old rust heap in the middle of an ugly industrial area. Being next to a world-class facility, near the waterfront and in walking distance to the university is an utterly different matter. Having the stadium on the waterfront will be fantastic for the university and fantastic for the city.

  13. David

    Adrian, Wellington also has a waterfront stadium, and ten years on the area around it has changed little. It’s just as grotty as it was ten years ago – virtually no change.

    As for decayed old rustheap. You may have forgotten that tens of millions were spent recently on upgrading Carisbrook – in fact large parts of it are only three years older than the caketin.

    If you want rejuvenation in Dunedin, come back in 2030 when the noose of stadium debt is finally removed (all going well).

    Then we might be able to spend on projects that give a reasonable positive return to the city. (look at Oamaru victorian heritage project – a $3m spend forecast to bring in $16m in five years. We’re spending over $200m and don’t get that level of return).

  14. Adrian

    David, errr…. that’s because the cake tin is surrounded by railyards, a motorway, and commerical wharves. You can’t build upon a railway or a port. Do you see the difference here? Your non-point aside, let’s examine Wellington’s waterfront as a whole – where there is space available for redevelopment. In the last decade the entire area has been rejuventated – reimagined – by the council in tandem with private developers. I see no reason why the same process won’t happen in Dunedin. I know were I to move back, I’d love to live on/near the harbour. Again: this project is a blessing for the city.

  15. David

    Adrian – you seem to have missed the point, or a couple of them.

    The new Dunedin Stadium will be cut off from the waterfront by a new highway, and the railway. It’s hemmed in on the sides by a quarry and industrial fuel tanks.

    And you seem to have also missed the point that the plug has ALREADY been pulled on Dunedin’s proposed waterfront development. The money is going to the stadium instead.

    The stadium is THE REASON there is no money for the waterfront development.

    The stadium is THE REASON the Otago Regional Council has pulled the plug on their cornerstone waterfront building.

    Understand??? The waterfront proposal has been canned to fund the stadium.

  16. Peter

    I thought the reason the ‘plug has been pulled’ on Harbourside for the current annual plan was dollar signs in the eyes of those who see an oil boom for the city and engineering firms appealing the District Plan change. Do you support the Harbourside vision btw David?

  17. David

    Peter, I think we need some sort of development around the Harbour Basin, however compared to Wellington there are a number of issues to overcome.

    Unlike Wellington it’s not really within close walking distance to the city centre. There’s also the railway as a barrier to being able to get there, so effectively our waterfront is a separate destination to the city centre.

    Few places in town have such a consistent cold wind, so it may not be very suitable for outdoor use of any type.

    And of course there’s the issue of a major development partially killing off the city centre, just like what has happened to Christchurch.

    If there is to be a waterfront development, it might be a good opportunity for some innovation – i.e. arcades like the former Farleys Arcade in Manse St (a street with an arched glass roof). Or how about Farleys Arcade meets Venice? I like the canals idea that was part of the development plan.

    It could be an all weather venue that is used to its full potential every day of the year (unlike the stadium which is likely to be used to capacity once a year, will be 70-90% empty on the other 12 days it is used, and 100% empty for 350 days per year).

    However I suspect the issues mentioned earlier will always mean any Dunedin waterfront development will have difficulty in easily attracting visitors in the way that Queens Wharf and the Viaduct basin do.

    In which case we should continue with lower key development, expanding from the start the ORC made with the end of the Harbour Basin.

  18. No David, it’s a waterfront stadium in general location only. The main connection will be between the city/university and the stadium, which will be greatly enhanced by the very fact that the main highway to the cities port has been redirected to the other side of the building.

    The Cake Tin was never going to be ‘the’ pill for redevelopment of the Wgtn waterfront, well not the winning design anyway. The other entries into the competition for the Westpac Stadium designs were more connected with underground routing of the main road etc – but even then Wgtn has the Oriental Parade end of the waterfront as it’s connection.

    The Stadium is not the ONLY reason the waterfront redevelopment has been canned, the mere fact that it was a pretty weak plan is a huge factor in this.

    We’ve all had the opportunity costs of the stadium thrown at us ad nausea last year – no clean water – no clean beaches – poor broadband etc, these have all not suffered as a result of the Stadium development.

  19. Peter

    I don’t think the location of the Dunedin waterfront is that dissimilar to Wellington either by distance or access; entry to Queen’s Wharf or Taranaki St Wharf in Wellington needs you to cross quite a busy arterial route. The main issue Dunedin needs to address is access across the railway line, particularly reopening the Rattray Street level crossing. If that was done the steamer basin would be very accessible.

  20. David

    Paul – while you may scoff at opportunity cost, it will always be an integral part of any prudent financial analysis for any big project like this.

    Just like it would be for you if you decided to go into debt for 20 years to buy a big boat that you would hardly ever use. You’d have to be insane not to check other options for using such a vast sum of money with huge ongoing costs.

    What other options did our representatives check out for spending quarter of a billion dollars? None. It was either a rugby stadium, or a rugby stadium, or a rugby stadium.

    The waterfront project is irrelevant now – there’s no money left to do anything anyway. We can start discusing ideas again in 2030.

  21. David

    Peter – there’s quite a difference.
    Wellington – Lambton Quay to Queens Wharf – 300m.

    Dunedin – Merridian Mall to Harbour Basin 1500m.

    Even from the Octagon it’s about 1000m – a little less if there is a Rattray St footbridge.

    It’s quite a difference when you look at the return distance for shoppers, visitors or workers on a lunch break (600m vs 2 – 3 km = less than 10 min walk vs 30 – 45min)

    The Rattray St bridge should be built anyway. Perhaps it can be made into a feature, like the bridge and tower that connects Newcastle (NSW) city centre with the new waterfront (but a prettier version) see
    http://www.davidwallphoto.com/searchresults.asp?tx=&ts=newcastle&c=&t=&g=105&Lids=&Gids=&p=4&n=22632&phrase=all

    Someone obviously wanted a tower for the Settlers Museum – perhaps it could be incorporated into a pedestrian bridge over the railway.

    • Elizabeth

      This evening, Channel 9 couched its news item on the Appeal decision with “STS received news they didn’t want to hear”… asserting that “construction of the Forsyth Barr Stadium will definitely keep moving ahead”.
      Mayor Chin repeated the facile hope that this is an end to the debate over the stadium…that the decision “gives a finality so the community can get on”…and together “we can make this stadium happen”. He says STS “should and will pay up”. He notes the burden on the council’s “time and energy” in relation to the two court cases and will be looking at the impact on council resources in defending its actions.
      STS president Bev Butler “didn’t respond” to Channel 9 calls today.

      A video link might be available later.

  22. David I certainly was not scoffing at opportunity cost. I was always under the impression though that an opportunity cost is:

    “Opportunity cost is a key concept in economics because it implies the choice between desirable, yet mutually exclusive results.”

    This would imply, that these so called opportunity costs were indeed false, in that the stadium did not:

    a) prevent the cleaning up of the beaches on Dunedin’s eastern coast. Indeed those surfers holding “clean up your own shit first” banners at the march, were proven wrong only a matter of weeks later when the new sewage outfall pipe was completed and commissioned. Unless they were the official committee of the Otago Blind and Don’t Listen to and Politics Surfing collective, they knew very well that there was a new sewage pipe a matter of weeks away from operation.

    The Sewage on the beach issue thrown up as an opportunity cost was in fact a misnomer.

    b) The clean water issue for the greater Dunedin area was also thrown up as an project likely to be an opportunity cost of the Stadium. However as this was approved, started and completed in parts of the outer suburbs of the city during the time period of the debate about the stadium, again this was a misnomer.

    c) There were numerous references to the roads of Dunedin, the potholes and the general state they were in, as another opportunity cost casualty of the stadium. However as road projects mentioned actually fell outside of the jurisdiction of the DCC or were in the long term plan, or actually under way at the time, it was again to be proven a misnomer.

    d) The broadband issue was thrown about several times. Claims were made that there were businesses lining up to leave Dunedin due to the poor broadband. There were several issues surrounding this so called stadium opportunity cost.

    i) Dunedin has fantastic business broadband. I am on a business broadband plan for my business and it is fantastic. I am on a residential broadband for my house and it is fantastic (even in semi-rural Dunedin). It is not the responsibility of the DCC to ensure that businesses are on the best broadband providers – that is a simple failure of business. Indeed Dunedin and the University is part of one of the fastest internet connections in the Southern Hemisphere.

    ii) The REAL opportunity cost of business relocating to a larger city would greatly outweigh any perceived advantages of supposed faster broadband – of which I know for fact my residential connection in CHCH is slower than here in Dunedin. The cost of relocation of the business for a start. The mere fact that the country looses $1B annually because of traffic congestion in Auckland, that housing and living costs are far greater in most other large cities in the country etc, all point to the fact that this idea was nothing more than hot air posturing.

    Don’t believe me, I am on the internet possibly 10x longer than most people for work and pleasure, and I would say that Dunedin is as well served with broadband and 3G cellular technology as any other city in this country.

    iii) Broadband is already an old technology, one that won’t go away for a very long time, one which is evolving, but one that is in the process of being superseded by the likes of Wireless web and 3G web connections.

    I fully understand the concept of opportunity cost. Yes there will be opportunity costs of this development, but none of those supposed ‘champions’ of the term as paraded about by the Anti-Stadium lobby have proved to be true or indeed a cost at all.

  23. David I agree with you 100% re the bridge idea. The world is blessed with stunning bridge design, some of which have become iconic and an integral part of the social and cultural landscape.

    I can think back as far as about the 4th post on this blog in which I lament the lack of thinking in this country which is evident in other parts of the world, which can best be seen in the Milau Viaduct. All it needed to be was a bridge, but it is more than a bridge in the middle of nowhere.

    Nice pics David, look forward to your images of the Stadium construction. Cheers

  24. David

    Paul – I agree water and sewerage were not opportunity costs – that ball was set in motion in the mid 90s.

    I’m talking new projects, waterfront, trams, pier, theatre, etc. There’s not even anything like a bmx track for kids on the south side of the city. We’ve got to do a 28km round trip to Forrester Park just for the kids to have a bike ride. (if places like Omarama – population about 150 can have one, surely we can too?).

    There’s a lot of projects a lot of people would like, that would be used far more regularly, that could have been done for $200m, instead of giving all that money to a single minority interest, and then have it sit empty for 97% of the time.

    It’s a massive, massive waste.

  25. David

    Paul – I agree about more vision being needed for many of these projects – add some much needed flare into them.

    However the new stadium takes this line to the extreme. Carisbrook functions very well as a rugby and test venue – it’s just not pretty.

    Effectively we’re spending $200m on making it prettier – the functionality is little different.

    We’re better off spending money on facilities we don’t have – instead of going into debt for 20 years to duplicate what we already have.

  26. The Dunedin City Council has already begun borrowing to fund the Stadium, with $90 million locked in at an interest rate of 6.4%.
    http://www.odt.co.nz/news/dunedin/61941/stadium-council-borrows-109m

  27. Adrian

    David, to say the new stadium “duplicates” Carisbrook is like saying that a new Mercedes duplicates a Model T Ford, or that a new MacBook duplicates a Commodore 64. I’m sorry, but your arguments are based around fallacies and simple non-sequiturs. In addition, the idea that the money would somehow be there for other projects were the stadium to disappear tomorrow is spurious in the extreme. I remind you that STS fought tooth and nail against the very rates increase required to fund the stadium. Do you expect the Regional Council to commit the same funding to a bunch of minor projects in Dunedin? UoO to kick in $10 million, too? Please.

    • Elizabeth

      The new stadium simply doesn’t do much more than duplicate the existing facility, even considering any advantage of location. This isn’t a multipurpose stadium, as already debated ad infinitum on this site.
      It’s a trumped-up project to suit the rugby barons/business people who incidentally are pocketing or will do profits from stadium construction and future property deals in the area. This is not chance or coincidence, Dunedin doesn’t work like that – they’ve had their aerial maps out for quite a few years including around the routing of the harbour arterial. Ask the commercial real estate agents. Or don’t ask, since they’ve been in the picture for their own profits a long time too. Some of us here have always said the stadium and the roll-out of other investments is merely redistribution of wealth (rob the citizens, in the stadium’s case, to start the escalation off) for a small group of chaps’ personal/corporate financial gain. That’s how business works…and DCC being what it currently is helps this along by ‘subsidising’ the shortfall in private sector funding rather than canning the project and looking after the wider citizenry in a responsible manner. Dunedin citizens have been done like a dog’s dinner.

  28. Richard

    David says:

    “And you seem to have also missed the point that the plug has ALREADY been pulled on Dunedin’s proposed waterfront development. The money is going to the stadium instead.

    The stadium is THE REASON there is no money for the waterfront development.

    The stadium is THE REASON the Otago Regional Council has pulled the plug on their cornerstone waterfront building.

    Understand??? The waterfront proposal has been canned to fund the stadium.”

    This will be news to anyone on Council!

  29. Phil

    Totally off topic, but I’ll share it just that same. I have been, for the past 10 years or so, an avid collector of antique construction publications. Old trade manuals, architectural guides, and so forth. Over the weekend I was thumbing through a English plumbing manual, printed in 1865. There was a rather interesting section on the best techniques for working with lead pipes. I shuddered just reading it. Another section spoke at lengths on the accepted methods for disposing of household effluent directly into waterways. There were calculations about distances from your neighbours, and stream flow rates. I wondered how it was that educated people could have found this to be acceptable. It’s not all that long ago. Then I got to thinking about some of our southern dairy farmers. And I shuddered again.

    Just a trivial break in the thread.

  30. David, I and others don’t see it as duplication – we see it as necessary upgrading.

    Otherwise if we were to apply your thinking to stadia across the country, Eden Park, Athletic Park, Lancaster Park and Carisbrook would all be kept circa 1980s, as their primary function of holding a sporting event on a good playing surface was indeed satisfactory.

    Unfortunately things just don’t happen that way, and we have been repeatedly told that modern facilities and stadia must be provided if we want to consider hosting top international events.

    Think of it like the poverty cycle in reverse. If the facilities are of international quality (which they aren’t nationwide with very rare exceptions), then we are in a position to bid for big international events. There is no greater example than FIFA and their wish to host the U20 men’s and women’s world cups in emerging markets. NZ has successfully hosted younger age group events, but to step up to the 3rd (or 4th depending on which reports you read) largest sporting event in the world, the U20 men’s world football cup requires modern stadia. FIFA has more or less told NZ that it would be in line to host one if not both of these international events if the facilities are upgraded. There is no more powerful sporting body than FIFA, and if you are told by FIFA that you are in line for said events, you don’t sit back and think “she’ll be right mate”.

    But then there is the flow on effects. The Wgtn Phoenix would most probably have not even considered Dunedin as a place to play a game, but as a result of the new stadium, it is now very much on the radar. This is very much the tip of the mountain of what will be available to this city as a result of the stadium.

    Yes there are projections of this and that, but they are all very conservative but they don’t take into account the flow on events which are now starting to come to light as a result.

    Then of course there are the other uses for this stadium as a result of the roof. It’s quite simply the difference between saying the Smart Car is a perfectly good vehicle (which it is), but a decent station wagon is not only a comfortable vehicle, it has many uses beyond the simple utility of moving people about.

    But we’ve been through these points time and time again, and seemingly positions aren’t moving.

  31. Phil – Elizabeth, we all know there will be the perfect place to discuss this sort of issue very very very soon – I promise.

    Soon, we’ll be as off topic as we like, and it’s going to be so interesting – I can’t wait.

  32. Seems we have found uses for the old clay and concrete pipes around the city – fantastic.

  33. Caz

    Hi Elizabeth
    I miss Dunedin and I’ve often thought about moving back there especially when I had 1080 poison dumped all over my backyard. But as much as I’ve hated it, I know its effects are only going to last for 6 months or so, where as the effects of the stadium are going to be with the people of Dunedin for the next 20 years or more.
    Where I live now, we have a mayor who isn’t influenced by greedy power mongering people like you have in Dunedin. Like those who made a 100% profit or more from land sold for the stadium.Then you had a real estate agent who haggled over the deal for profits for himself.
    His name was {sorry I’m keeping this clean while the vultures are circling – ed Paul}.
    Phew, on and on it continues.
    While the struggling ratepayers are forced to pay more and more

    • Elizabeth

      Hello again Caz – thanks for calling by
      Yes, there’s the unsettling feeling/fact attaching to Dunedin’s hierarchies.

      I well appreciate the qualities of your Mayor, as known through his living in a community not far from where I grew up!

      Been watching the 1080 issue…should it be sprinkled over perpetrators of that other target starting with ‘s’. Or would a triple dose of swine flu suffice?

      Cheers.

  34. Actually we are still only paying $66 per annum.

    But yes as you say, we will be benefiting from this brilliant development, but actually beyond the 20 years it’s going to take to pay off, indeed well past that.

  35. Richard

    Says ‘Caz’:

    Like those who made a 100% profit or more from land sold for the stadium.Then you had a real estate agent who haggled over the deal for profits for himself.

    His name was {sorry I’m keeping this clean while the vultures are circling – ed Paul}

    Yes, unsubstantiated and uncalled for!

    • Elizabeth

      Aside:
      Busiest day for What if? 24 Aug 2009.
      Number of views has surpassed the previous high on 11 June.

      {update: 747 hits to midnight in the 24 hour period}

  36. Adrian

    In all my time watching this debate, I’m yet to see an actual argument against the stadium proffered. The closest I’ve seen is David’s “this money could be better spent on other things”, as if the money were already there in a big pot and that the STS cult would happily have rates increased for BMX tracks.

    Now, if people said “I can’t afford $66 per year more”, then at least that would be a valid argument. But even today, when – surely – someone could offer up an argument that didn’t rest on conspiracy theories, all I see are whines about property developers. This, again is NOT AN ARGUMENT against a public project going ahead. It evaluates nothing concerning the building and use of the stadium. It’s these utter non-sequiturs that have characterized arguments from the anti-stadium side throughout. Global warming? Piles might collapse? Council are Nazis?

    Is this, seriously, all you’ve got? Really? Don’t you feel just a little silly?

    • Elizabeth

      Check out state of council finances, the LTCCP, the various multitudinous letters and submissions across the last years – whatever. It’s all there and bright minds and investors beyond those cited here of an evening might get you to the copious reasons. You might even have regard to DCC’s admissions of the opposition…which the Mayor so desperately wants to heal in order to go forward.
      Sigh.

  37. “as if the money were already there in a big pot ”

    This is something that I have found amusing too. All of the supposed opportunity costs, the ‘other’ projects touted as possibility, very few if any were on the table before the council decided to invest such a large (and don’t be surprised, I do believe this to be a massive) sum on a stadium.

    It’s not as if all of a sudden there was going to be tens of millions upgrading social housing in the city. Or that was going to be a massive injection of new money on roading, cycle ways etc. This money was earmarked quite considerably for this sole purpose – not instead of other projects.

    Do not be fooled into thinking that the councillors and city officials don’t appreciate the massive amount of money that is involved here. Funny thing this democracy. Unlike council employees or other normal employees, councillors are elected. They can be sacked come election time, and this is the sort of decision which could make or break political careers. There are very few jobs in which one’s job security is in the hands of a few very organised groups, each pushing their own agendas (as in the group of surfers protesting sewage on the beach), whether that agenda has basis in fact or not. Come election time, the fears and prejudices of many will come to the fore – that is no basis for job security or stability.

    For that very fact alone (apart from actually wanting to do what they genuinely believe is the right thing – just like the Anti-Lobby) this was not a decision taken lightly with funny hand shakes and ‘mutual’ bank accounts.

    Also do not be fooled for one second, as much as I want to see this project succeed, no matter how wonderful this stadium is, it will be down to individuals to make this thing a success. We need look no further than Rogers Centre in Toronto. A wonderful facility, which through mismanagement failed miserably. However a change of ownership and leadership and it is now one of the most successful entertainment facilities in North America. Before you all holler that of course it is, it is in a massive city of several million people, it’s going to be successful. In that case why didn’t it succeed in the first place, and why did it cost the city millions upon millions of dollars, then only to succeed at a later date – management.

    FB Stadium at University Plaza needs a management team and structure that needs to be as innovative as any in the world (give the continual reminders of the limitations we have, population, location etc). We can see how innovative the management team behind the Bowl of Brooklands in New Plymouth are, along with the promoter Andrew McManus. New Plymouth has as many of the same limitations as Dunedin has, yet they have secured some of the biggest acts recently, and by all indications this is just the beginning. I for one will be travelling all the way to New Plymouth for Fleetwood Mac in concert (on my concert Bucket-list, yes I have one).

    The facility is but one part of the puzzle, just as the council and the CST team have been. The next pieces in the puzzle will of course be the construction team, and then ultimately the management team.

    This team must be the most wonderful of listeners, the most studious of practitioners and the most aggressive and innovative of mind and practice.

    Because, yes at the end of the day a MASSIVE amount of previously unplanned money is being spent on this project. But it was never going to be money to put a cable car back up High St, or this that and the other.

    • Elizabeth

      One thing, in principle, we can agree on Paul is the need for innovative and astute management of the stadium and related venues. As yet there is no sign of same, and this will be the issue as you, I and others have said in our different ways.

      Debt funding of the stadium is one thing. Dunedin citizens might well have considered debt funding of alternative community projects and infrastructural developments (probably not to the same extent as that [unknown and counting] for the stadium) as they’ve been suggesting for years in their submissions to both DCC and ORC.

      Did the councils listen or ask for more in-depth information to ground the feasibility for same, well, yes and no.

      The next elections might not be based on forgiveness if residents want more of a say in their destiny…

      To talk of the average residential ratepayer’s $66 per annum for the stadium is really not the reality most of my contemporaries are facing as commercial property owners or farm owners…the stiffness with which they will fund the stadium is out of all proportion. The passing on of these costs in sum or part is possible for some, not all, and the council well knows it.

      The average $66 pa rate per average residential property is the Council’s handy accounting tool designed to massage belief…get real folks.

  38. James

    Paul — I acknowledge that there were not other projects on the table at the time, and that the amount of money that is being spent on the stadium would not be spent on other projects. However, the stadium will impact on future cashflow. That is, in 15 years time, there will still be $5million dollars of ratepayer money flowing toward the stadium (with another $3million coming from CCO cashflow). That means, any project initiated then will require extra cash on top of that. This means, I think, that it may be that much harder to find money for other projects for the next $20 years. Personally, I would be happy to pay another $66 a year if it meant that $80million dollars of other exciting initiatives could be developed (or simply $5million of new initiatives each year), however, I suspect many other ratepayers won’t be so excited by that prospect.

  39. James

    To talk of the average residential ratepayer’s $66 per annum for the stadium is really not the reality most of my contemporaries are facing as commercial property owners or farm owners
    The farm owners are not wearing the cost too hard relative to commercial property owners from the published numbers. The other point is that there is also the $3million per annum coming from CCO cashflow, which could have been directed to other spending. This makes it closer to $100 (maybe a little less if they can pay less tax again) for the average ratepayer.

    • Elizabeth

      The submissions from Federated Farmers on the rating of farm properties have attracted comments from councillors on alternative rating method. Richard has offered comment a couple of times or so on What if? about this, at least once referring to rating method as a blunt instrument.

      I understand there is rates review work going on at DCC or will be. Richard is more au fait with this than I am by a long stretch.

      People with farms valued over $4m, facing export issues with the NZ dollar, having difficulty with capital repayments during the global recession and or challenging seasons and stock capacity aren’t so happy with the additional stadium rate – believe me. What kind of benefit is the stadium to them, they’re not all with the time – or ticket money – to be locked into rugby spectatorship that requires a trip to town, obviously.

  40. David

    Adrian – you obviously haven’t been watching long. There’s been a large number of logical reasons to not build a new stadium.

    1/ We already have a stadium.
    2/ As well as paying $5m more in rates, there are several million more taken out of our city companies that would subsidise rates, or other city projects (in other words the $66 figure is demonstrably false).
    3/ The new stadium will deliver few financial benefits to the city. In fact over 90% of those benefits are already delivered by Carisbrook.
    4/ Ratepayers are having to take huge risks underwriting the government’s $15m if the stadium is not ready.
    5/ Ratepayers are having to take huge risks underwriting the private sector funding that has not eventuated.
    6/ Ratepayers are having to take huge risks underwriting missing income from the plummeting spectator numbers.
    7/ The vast majority of people who are being forced to pay for it don’t want it.
    8/ It is a vanity project. It is only being built to make people feel good – it isn’t actually needed.
    9/ Over half of Carisbrook is not much older than Westpac Stadium, yet we are falsely told it is old and decrepit.
    10/ We are told we have to upgrade Carisbrook to make anonymous people in overseas organisations happy. Last time we did this we had to put seats on the terraces – the seats killed the crowds and the terraces have been empty ever since.
    11/ Community groups in Otago miss out on $7m because it’s all going to the stadium.
    12/ There’s $37m less ORC money for other projects.
    13/ Even if everything goes exactly to plan and there are no problems, over runs, etc, the council still goes so far into debt that it is past its own self imposed debt limits (with city companies, over $10,000 per debt per house).
    14/ City companies are being hit with an average of over $13,000 additional rates per average commercial property – that’s $13,000 less investment from every commercial property in the city.
    15/ I never known so many people so fed up with the council over the stadium that they’ve lost strong loyalty to the city that’s kept them here for years.
    16/ The city will be missing out on new projects for twenty years.
    17/ It would be hard to find any project of this size that will bring in less return than a second stadium.
    18/ It is likely to be used to capacity perhaps one day every 365 days. It’s likely to be completely empty close to 350 days per year. Half a dozen days per year it will be used for Super 15, and will likely be 50-60% empty. About six days per year it will be used for NPC. With current crowd figures, it will be about 90% empty.
    19/ It is costing so much, for so little use, that every time someone sits in a seat, ratepayers are subsidising $50-$100 – an appalling waste of money.
    20/ Pretty much all points above, are if everything goes according to plan. As one councillor said, it could bankrupt the city.

    Even Richard Walls said the council cannot afford to spend $91m on the stadium (yet has since backed spending much more than this).

    Jim Harland said if the amount owed goes over $92m then the city’s ability to pay the debt will be “substantially jeopardised”.

    Yet we’re now well over $100m and climbing steadily (not counting $7m for Carisbrook, roading, new bridges, etc).

  41. James

    David — Just a question on point 14. It says here that the cost to the average non-residential ratepayer is $672 (not including farmland). Is there some other great swathe of non-residential real estate that is dragging that average down from the $13,000 for commercial ratepayers?
    http://www.dunedin.govt.nz/council-projects/stadium/cost-of-the-project

  42. David

    James – it’s a 20 year loan, although in today’s court decision it looked like a 22 year loan.

    So the stadium cost is around $1320 per average house, roughly $13,000 per average commercial property etc (or perhaps 10% more if it’s a 22 year loan)

    People I know are asking why they should be shafted for $13,000 for something they don’t want, they won’t use and something their business doesn’t use or benefit from.

    Though that’s not counting all the millions in lost subsidies from city companies (add about 60%).

    Some of the people paying this vast amount are hard working small businesses earning no more than the average wage – many less. And this is on top of their payment for the stadium under household rates.

    If the government closes the loophole for deliberate tax losses you can add another couple of million per year, ditto for interest rates, over runs, loss of private funding, lack of spectators, late construction finish etc etc etc.

  43. David many of those points are highly debatable from the very first one. Wellington also had a stadium it was called Athletic Park.

    #9 yes it is old and decrepit, the rest as they say is just ‘lipstick on a pig’. They tried that approach to Athletic Park and Eden Park, oh and for that matter Lancaster Park too.

  44. David

    Paul – over half of Carisbrook not much older than Westpac Stadium – new terraces, corporate boxes, railways stand, pitch, lights etc.

    You could actually demolish everything else and still have enough capacity for every single game except the test every two or three years.

    It’s only a fraction into its usable life and it’s labelled old and decrepit. That just shows this whole issue is actually about fashion, ego, and vanity – it’s nothing to do with what is needed.

    It has everything to do with people’s insecurity and how they think outsiders will view Dunedin (the fact is the outsiders don’t give a toss).

    It seems Dunedin doesn’t give a toss either (about rugby anyway – NPC had an average crowd of 3700 last year – 3700!!!)

  45. David

    21/ We’re spending $200m to get a forecast profit of $0.2m (if everything goes well) i.e. 0.1% or 1/1000th

    If we save that, then in 100 years we’ll have a 10% return – what most people expect to get from their investment in one year.

  46. Phil

    Ah, the memories of sitting in the Millard Stand at Athletic Park on a Saturday afternoon. Wind whistling up from Cook Strait. Those were the days, and not happy ones. Probably would have paid for a roof myself, if I thought that was an option.

  47. James

    David — A little context would be good. If that average business sold their building and rented it back, it would likely cost more than $1,000,000 dollars over the 20 years…

  48. David

    You’ve got to ask if the appeal court has made a mistake.

    If you buy a house, the cost is judged on what you pay – not what you pay over the term of the mortgage because no one – no one at all – has any idea what interest rates will be in ten or twenty years time.

    If you buy a business, the cost is based on what you pay – what you know now. Not on an unknown theoretical interest rate in 2020.

    The court has NOT judged the actual known capital cost, against actual known increased capital cost.

    They have taken the bizarre step of judging a completely unknown cost (the total cost over 20 year with unknown interest rates), and compared this to a revised completely unknown cost.

    They have determined that the two costs are the same, despite having NO idea what either figure will be.

  49. Rosemary

    I would like to add a couple of reasons additional to David’s admirably comprehensive list:
    21/ the site chosen means that State Highway 88 has to be rerouted not through the obvious and previously identified choice of Parry St to link Ravensbourne Rd with Anzac Avenue but down a route alongside the rail corridor and encroaching on it. The encroachment limits the ability of rail to be made dual-track to Port; the alignment means that in order to meet SH1 and cross the rail-lines to the arterial highway an expensive aerial bridge needs to be built; and the bridge means that the ceremonial route commemorating the Anzac brigades will be destroyed, as will a couple of other landmark structures in the area – the Wickliffe St Bridge & the Donald Reid Warehouse.
    22/ Siting the stadium in the North End puts yet another activity in that area and takes yet another from the South flat. Where stadiums world-wide have had any success in creating economic activity it is in large cities where they have revived decaying derelict areas. Dunedin is not a large city but small as it is, the North End receives the lion’s share already of capital injection; the south is where it is needed now.
    23/ This monstrous building will be visible & its activities audible to the residents of all the inner ring of hill suburbs.
    24/ Some 80% of the residents don’t want it.

  50. Rosemary

    Ooops. Only the Wickliffe St bridge is destroyed by the new one – the Donald Reid Warehouse is destroyed by the road’s alignment. Sorry

  51. David

    The court found the coucil made a $13m error in their calculation on what ratepayers would pay.

    A $13,000,000.00 error ??????

    That’s nearly ten times our contribution to the Chinese Garden.

    How is it possible to make a $13,000,000.00 error if you have even slightly competent people working out the figures?

  52. Max Power

    Rosemary, the highway alignment was in the works before the stadium. The university wanted the traffic taken away from the campus area as it presented a risk to students.

  53. David

    Considering over 95% of the campus is on one side of Anzac Ave – in fact most is hundreds of metres away from Anzac Ave, as are virtually all student flats – then the cost /benefit of completely realigning the highway, with millions needed for a new bridge, is highly questionable.

  54. Richard

    Rosemary: you say “an expensive aerial bridge needs to be built; and the bridge means that the ceremonial route commemorating the Anzac brigades will be destroyed, as will a couple of other landmark structures in the area – the Wickliffe St Bridge & the Donald Reid Warehouse.”

    I note your later correction to the latter which is not – and never has been – the ‘Donald Reid Warehouse’. It was originally built for Henry Berry (Grocery Merchants) who shifted there from Moray Place, then converted and added to as a Bakery, then after being empty for some time, it was temporarily used by Reid Otago Farmers (which is whom I take it you are referring to) but has been the ‘Laser’ for some years now.

    One of the concept plans certainly cut off some access to the building but, I understand, has long been discarded as covered many moons ago in a thread on this site.

    There would always need to be a new bridge to carry the SH traffic to Port.

  55. Richard

    David says: “The court found the coucil (sic)made a $13m error in their calculation on what ratepayers would pay.”

    You obviously have not read the affidavit by Athol Stephens, DCC GM Finance and Corporate placed before the Court of Appeal and which is available on the DCC website. I specifically refer you to the second part of his evidence in clause 71 (the penultimate page).

    Nor the decision. Refer to clauses 45, 46 and 47.

    I suggest you do some reading instead of making “sneaky” comments about the competency of anyone.

    In short: The Court did NOT “find the error”.

    Nor did STS “FORCE the DCC to admit that what they told the Christchurch High Court was wrong.”

    There is no additional $13m for the “ratepayers” to pay.

  56. Rosemary

    Max – before the stadium, the highway alignment was designed to go along Parry St. The new alignment which wrecks some of our heritage is necessitated by the stadium.

    Richard – you’re right about the building I called Donald Reid warehouse”, I’m wrong but I’m glad you knew which building I was referring to and gladder to learn that it is no longer to be demolished or partly demolished.

    And Richard, the bridge that there would always be a need for is the bridge over the Leith. The bridge that the realignment of the highway necessitates is the gyratory straddling the intersections of Parry St, the rail corridor and Anzac Avenue. This bridge would not have been necessitated (but may have been elected when money became available) by the Parry St alignment.

  57. Rosemary

    And Max, one more thing, the proposed connection of SH88 & SH1 designed to accommodate the stadium now intersects the Campus along Frederick St. Had SH88 been routed along Parry St, then not only would SH88 be routed outside the campus, its connection to SH1 and the Harbourside arterial could have stayed outside also at St Andrew St, (a connection we only recently paid for).

  58. David

    Richard says “There is no additional $13m for the “ratepayers to pay.”

    Who will pay it then?

    The council has previously argued this will be covered by government, which was later admitted to be false.

    So who pays the additional $13m?

  59. Rosemary

    And Richard, Venning, Young et al found “…the $15 million Crown contribution cannot also do what Chisholm J thought it did, namely net off the unallocated $13 million funding shortfall. It seems that this is what the evidence before the Judge indicated, so we certainly make no criticism of him for having reached that conclusion.” I don’t know how familiar you are with Jane Austen, Richard, but this puts me in mind of her wonderful summing up of the characters of Darcy & Wickham (not quoting but to the effect): Dear Jane, you cannot make them both good: there’s only so much virtue to go round between them and for my part I place it wholly in Darcy’s part, but you Jane, may place it where you will.

  60. Richard

    Hi again Rosemary

    It was “planned” to go along Parry but never taken to design stage.

    Even then, there were thoughts that it was going down the wrong line. The university and Hocken staff certainly thought so!

    As has often been pointed out, the railway has always “cut off” the city from its port. The one way street system and, more latterly, the removal of the Rattray Street level crossing underlined that! In short, TWO separate barriers to cross instead of one.

    The opportunity to put the “Port to Port” State Highway alongside the railway track – as identified in the Transportation Strategy – offered, and the advent of the stadium proposal, finally opened up the opportunity to do that.

    It makes sense to do so even if the stadium is taken out of it.

    Despite what David says, the university own most – if not all – of the land south of the Leith between Anzac and Parry and, for all I know, may go beyond that. If you stand back and look at the area, it is in fact, the only practical way the University can expand without ripping out what are now green areas within the present campus.

    With Unipol etc already established, there are very high numbers of student pedestrians already crossing Anzac Avenue. There are other constraints on its continued use as a state highway.

    The “gyratory” was but concept option. ISCOM was informed at one of its meetings some time ago time that it had been discarded. I posted that on this site (but goodness knows under what thread) many months ago.

  61. Richard

    “And Richard, Venning, Young et al found “…the $15 million Crown contribution cannot also do what Chisholm J thought it did, namely net off the unallocated $13 million funding shortfall.” ”

    Correct, but you need to read it in context. As Athol Stephens’ affidavit states, it was the explanation in the draft LTCCP that was wrong, and that council had already provided for the $13m shortfall at its meeting on 9 February.
    The funding was corrected in the LTCCP as confirmed on 22 June.

    That error was not found “fatal”.

    I can understand the desire of STS or anyone to find something to find ‘a positive’ but saying that the Court forced the DCC to admit something is just a bit to rich.

  62. Richard

    David: You clearly have not read the documents. Please do so. Simply: the explanation may have been in error but the $13m was already in the budget.

  63. David

    Richard, how do your reconcile that the council is now funding $104m, when you previously said $91m was unaffordable?

  64. Rosemary

    If Judge Chisholm’s finding, based on the evidence before him, was erroneous, then either he was provided with evidence “indicating” his erroneous finding, or he made invalid inferences from the evidence before him. Young & Venning exhonerate J Chisholm. Richard wishes to exhonerate the council staff. If he doesn’t want to find J Chisholm the source of the invalid inference then he must explain how competent staff managed to present evidence “indicating” Chisholm’s erroneous finding.

  65. Richard

    David: please do not try and mix bits of quotes up, whether mine or anyone else’s! And what is the point of it all? Sorry, I am not interested. Nothing has changed as it affects the ratepayer, the “$66 per average property” remains as it has been now for some time. We need to move on.

  66. Richard

    Rosemary:

    With respect, that is not what the Appeal Court decision says about that of Chisholm J. There are two words in there: “We make no criticism of him.”

    Apart from the earlier references, you need to read clauses 20 to 24. Nothing is in isolation.

    The Appeal was dismissed. (I could say “thrown out” as the media have termed things but I like to stick to the facts).

    Second guessing the judges is hardly productive.

  67. Richard

    Errata:

    There are six words in there: “We make no criticism of him.”

  68. Richard

    Rosemary:

    Council staff picked up the error in the LTCCP process.

    Who says: Chisholm J made an erroneous finding?

    Not the Court of Appeal!

    You can disagree with the decisions all you wish. Having set out the facts, I have other things to do.

    (Finis)

  69. David

    Richard,
    In the council meeting on whether the city can afford to pay $91m for the stadium…..

    Councillor Bezett said if it can’t be reduced to $20m below $91m, then it would not go ahead – it would be “game over”.

    You are reported as saying the you want the stadium but the city can’t afford $91m.

    Jim Harland said the ability to service debt above $92m would be severely jeopardised.

    So we’ve got three city leaders saying we can’t afford $91m, all of whom are now pushing to spend much more than this.

  70. Rosemary

    Richard, J Chisholm inferred that the Government’s contribution negated the $13m shortfall in funding that has to be covered by the citizens and their assets.

    The dilemma I described above leaves you several horns to stick on – you appear to be choosing the horn that has J Chisholm making an invalid inference from the material before him. That’s fine, but you must balance Venning’s & Young’s “we CERTAINLY [my emphasis] make no criticism of him” with their “It seems that this is what the evidence before the Judge indicated”. This is why they make no criticism of the judge. So this horn of the dilemma has been blunted by the justices who found the evidence before Chisholm seemed to indicate the erroneous finding, and I think you must fall off it.

    And this leaves you with a new pair of horns. If the evidence before J Chisholm seemed to indicate that the government’s $15m met the citizen’s $13m shortfall then that evidence was misleading. When the council officers presented misleading evidence, did they do so knowingly (i.e. competently) or unknowingly?

    Council may not have been found knowingly or unknowingly misleading a judge (though we may infer this) but StS can claim the moral victory of the finding in their favour that the cost to citizens has increased $13m since the LTCCP was promulgated. $13m may be peanuts to the justices and the councillors but they aren’t to me. And unless the DCC chooses to appeal this, this finding stands: the costs to the citizens has increased $13m since the LTCCP was promulgated.

  71. Rosemary

    Richard:

    “That being the case, it is clear that the $15 million Crown contribution cannot also do what Chisholm J thought it did, namely net off the unallocated $13 million funding shortfall. It seems that this is what the evidence before the Judge indicated, so we certainly make no criticism of him for having reached that conclusion.”… “we simply record that we are satisfied that the unallocated $13 million shortfall has now been picked up by the Council, thus increasing its capital contribution to the project by about $13 million.”

    This is a significant finding because it is the point that StS took to the appeal. It is on what followed from this increase in costs to the citizens regarding the LTCCP that the judge found in favour of the respondent.

  72. Richard

    No, Rosemary!

    The cost has NOT increased by another $13m. The figures in the LTCCP were correct reflecting the decision of the meeting on 9 February. The error was how they were shown in the draft LTCCP.

    Please read the documents especially the final part of Clause 71 of the affidavit made by Athol Stephens.

    What on earth would be the grounds for council to appeal?

    And why?

  73. Richard

    David: “So we’ve got three city leaders saying we can’t afford $91m, all of whom are now pushing to spend much more than this.”

    The date today is Tuesday, 25 October 2009.

  74. Richard

    Rosemary

    The three issues which the parties agreed for determination by the Court of Appeal are set out in Clause 8 of the Court’s Decision.

    The matter of the Cost is addressed by the Court in clauses 23-26 of its decision. Clause 26 notes that “The draft 2009 long-term plan had a section headed up ‘What Will It Cost Ratepayers'”, which despite the error identified above is CORRECTLY PREDICATED ON THE COST TO COUNCIL BEING $99 MILLION NOT $85 MILLION.

  75. Rosemary

    The cost to the citizens of Dunedin has increased by $13m to $104m from the $91m promulgated in the 2008 LTCCP. The 2009 LTCCP where this increase was advertised was not adopted until after the judicial review. However in both the high court & the appellant court (after the adoption of the plan!) the DCC submitted that this shortfall in funding was covered by the Government’s grant.

    “In the High Court, the Council seems to have argued that the requirement to meet this $13 million unallocated cost did not fall on the Council, but was rather met out of the $15 million contribution made by the Crown, which had not been provided for in the 2008 long-term plan. This was accepted by Chisholm J. On behalf of the
    Council R BARTON RENEWED THAT ARGUMENT [my emphasis] in his written submissions, but accepted in his oral submissions in this Court that the $15 million Crown contribution did not, in fact, off-set the $13 million funding gap. That is clear from the 2009 long-term plan adopted after the High Court hearing, where the correct position is stated.”

    This $13m unallocated funding or funding gap “has fallen to Council”; that is, it is another $13m to be found by the citizens of Dunedin. Therefore the cost to the citizens of Dunedin has increased by $13m.

  76. Richard

    I used to disagree with many of Colin Hawke’s rugby referring decisions. It never changed the result.

  77. David

    Richard says “The date today is Tuesday, 25 October 2009.”

    So the difference between not being able to afford $91m last year, and being able to afford millions more than that this year is……….?

    That’s right – council are putting rates up 40% in just four years.

    So what changed your mind Richard, from previously saying the council cannot afford $91m?

    (to now spending millions more than that, and taking on tens of millions on top of that in additional risk)

  78. David

    Richard says “The date today is Tuesday, 25 October 2009.”

    No, it’s not.

    You’re about 13 million,….er ….I mean 60 days….. out.

  79. Rosemary

    Just checked the figures… Council share estimated 2008 AP: $91.7m; 2009/10-19/20 LTCCP: $109.9m

    Athol Stephens told the appellant court that Council knew in February 2009 that Council would be funding the shortfall of $3m in Community Trust funding plus the increase in costs and yet the city argued before J Chisholm that the Government grant met the shortfall. Worse, the city’s counsel renewed this argument in the appellant court…

    “[45] In the High Court, the Council seems to have argued that the requirement to meet this $13 million unallocated cost did not fall on the Council, but was rather met out of the $15 million contribution made by the Crown, which had not been provided for in the 2008 long-term plan. This was accepted by Chisholm J. On behalf of the
    Council Mr Barton renewed that argument in his written submissions, but accepted in his oral submissions in this Court that the $15 million Crown contribution did not, in fact, off-set the $13 million funding gap. That is clear from the 2009 long-term plan adopted after the High Court hearing, where the correct position is stated.”

    So DCC’s counsel renewed in the appellant court the argument which had misled J Chisholm but which the DCC already knew to be false – this leaves a very, very bad taste in my mouth. I know which horn of the dilemma has pierced the council even if Richard refuses to recognise it.

  80. Richard

    What on earth are you on about? The comments you loosely and inaccurately refer to were made aeons ago. The funding model was subsequently changed and the effects of that were set out in the 2008-09 draft plan when a venues company was proposed etc.

    You seem to be in some sort of time warp.

    _____

    {Richard’s message submitted on 2009/08/25 at 3:57pm has been retrieved. It reads as follows. -EK}

    I repeat – for the final time: The matter of the Cost is addressed by the Court in clauses 23-26 of its decision.

    Clause 26 notes that “The draft 2009 long-term plan had a section headed up ‘What Will It Cost Ratepayers’”, which despite the error identified above is CORRECTLY PREDICATED ON THE COST TO COUNCIL BEING $99 MILLION NOT $85 MILLION.

    Rosemary: DCC 2 STS 0

    just live with it!

  81. Richard

    “So DCC’s counsel renewed in the appellant court the argument which had misled J Chisholm but which the DCC already knew to be false – this leaves a very, very bad taste in my mouth. I know which horn of the dilemma has pierced the council even if Richard refuses to recognise it.”

    I am not going to involve myself in responding to comments that are possibly actionable.

  82. Rosemary

    Richard: DCC: 2; StS: 0; citizens of Dunedin: -$200m

  83. But Rosemary we all know that’s not right. The citizens of Dunedin have not been hit up for $200m

  84. David

    Paul – The DCC argued in court that the cost to council is $204m

    Plus $37m from the ORC
    Plus interest on $37m
    Plus $7m from OCT
    Plus $7m for Carisbrook
    Plus $?m more if interest rates average over 7% in the next 20 years.
    Plus $?m more if private funding doesn’t eventuate

    Paul – I’d have to agree with you.

    It won’t cost citizens $200m.

    It will much more than that.

  85. Rosemary

    You’re forgetting the interest, Paul. During construction the first $40m is borrowed at 9.62% the next $50m is projected to cost 6.82% per annum and anything over $90m at 7.47% and then the next five years the now decreasing sum is hoped to be borrowed at 6.29% and after that 7.47%. Take the average interest rate as say 7.5% and the average amount borrowed (say 50% of $110m) and multiply it by the term of the loan (22 years). Well, you do it, but I relied on Athol Stephens’s long-ago estimate of the interest charges as about $90m. This figure was based on higher interest charges at the time but borrowing a smaller sum.

  86. Ah sorry David I forgot and it will take 1000 years to repay.

  87. David

    Paul –
    Forecast profit is just $200,000 per year.
    Forecast cost is $200,000,000.

    That’s a 1/1000th return.

    It’s simple maths.

  88. But your simple math has been caught out before.

    Also in your world there is no chance for things to exceed expectations – which in the real world they conceivably can do.

  89. David

    You mean an error like the council made of miscalculating to the order of $13m.

    Or like the error in calculating how much private funding would come in?

    Or like the error in counting all the five year memberships as ten year memberships, so the private funding target could be for the stadium go-ahead could be (falsely) met.

    Paul – now you are even arguing about the $200m, which is the figure the DCC used in court.

    As I’ve said before – provide a simple logical financial argument for the stadium and I’ll back it.

    Despite numerous requests, you’ve never, ever been able to do this.

  90. Rosemary

    Paul: do the maths. $55m x 7.5% x 22 years = $90.75m. Add that to $109.9m. Equals $200.65m.

    And this sum doesn’t include the bridging loan ($29.1m) the citizens must raise to cover the private share of the cost. During the construction phase this will be borrowed at 9.62% so it will add at least $5m to the citizen’s costs. Then add, as David reminds us, the ORC contribution and the OCT contribution and the publicly funded University contribution and the grant from the citizens of NZ… And don’t forget that in order to cover the costs of running the stadium we citizens will set up a maintenance fund of $6.4m. Only $200m? Yeah, right.

  91. David

    Paul

    The $200m cost, and $200g profit, are well known and publicly available figures from DCC and CST.

    It’s pretty simple to work out that the profit is forecast to be a pathetic 1/1000th of the cost, yet you dispute this over and over and over again.

  92. Richard

    Sigh! Rosemary and David – please deal with the facts. Once the venues company is up and running, interest is an OPERATING COST.

  93. Adrian

    David, I’ll respond to your points as soon as I can. I’m snowed under right now.

  94. David

    Richard – I was just using the figure the council gave to the court for stadium cost.

    Are you now saying this figure (like their earlier one proved to be) is wrong too?

  95. David

    Paul – It looks like directors fees and travel costs for the board of the new venue company will now take pretty much all of the $200,000 profit the stadium was forecast to make.

  96. Rosemary

    Richard, DCVL pays the interest – of course. But DCVL is a council-owned company. Therefore its revenues are owned by Dunedin citizens just as any revenue (and losses) currently generated by the existing venues are. But if you really want to be picky – DCC: 2; StS: 0; Dunedin citizens: -$110m; Otago citizens: -$45m (ORC & CTO); & NZ citizens: -$25m (UofO & govt). I’m not comforted.

  97. Richard

    Rosemary: “Therefore its revenues are owned by Dunedin citizens just as any revenue (and losses) currently generated by the existing venues are.”

    Really?

  98. Jody

    Rosemary: “Therefore its revenues are owned by Dunedin citizens just as any revenue (and losses) currently generated by the existing venues are.”

    Cr Walls response: Really?

    Could Cr Walls please clarify what his response to Rosemary means. Did he not realize the Dunedin citizens owned the revenues (and losses) of council owned companies, or is he suggesting we don’t?

  99. meg55

    I was wondering the same thing. I’ve just posted a similar line of argument on ODT online and am awaiting his reply with interest.

    No wonder they bang on so much about the ratepayers as opposed to citizens. So what if the rates don’t go up? They’re just shifting the debt to the trading companies, which aren’t doing well in these hard economic times. There won’t be much in the way of dividends for anything that might benefit Dunedin – stadium or anything else.

    Jody and Ro are right. If you are permanently resident here, are over 18 and fulfil certain NZ residency requirements you are a citizen and you can vote for the council. You are part of the corporation that comprises citizens, councillors and mayor and you are a stakeholder of the council’s assets.

    It’s our money they’re spending, whether we’re ratepayers or not.

  100. James

    He may be referring to the fact that the losses stay in the companies. If a CCO loses $5million, the ratepayers don’t cover it. If the company goes bust the ratepayers don’t pay that debt*.
    In fact, historically I think some of the companies have accrued losses that have been carried forward which means in profitable years they pay less tax. Richard will presumably correct me if I’m wrong on this.

    *Unless the DCC provides security over it.

  101. Richard

    Jody: It is not a response but a question of Rosemary as to what she means.

  102. Richard

    Meg: One leg at a time, please!

  103. Rosemary

    Richard, what I mean is:

    “The incorporation of the citizens of Dunedin that has legal status, which used to be known as the “Dunedin City Corporation”, but seems now to be known as the “Dunedin City Council”, has a number of assets vested in it. Because these assets are vested in the ownership of the legal entity that incorporates the citizens of Dunedin, one may say that the citizens of Dunedin (in their incorporated state) own these assets. One can say that the citizens of Dunedin, in their incorporated capacity, own the revenues of these assets. One can say that the citizens of Dunedin, in their incorporated state, are funding any enterprise that these revenues are put to. One can therefore say that the citizens of Dunedin, in their incorporated state, are paying the interest of the loan for the stadium. This means, DCC: 2; StS: 0; citizens of Dunedin: -$200m.”

  104. Richard

    Thanks, Rosemary. I get “the drift”.

    In simple terms, the relationship should be: (1) ‘Revenue and Costs; and (2) Profit (or surplus) and Losses.

    So to your last paragraph: No, the citizens of Dunedin are not paying the interest on the loan.

    As stated on P31 (Vol. 1) of the LTCCP, the post construction transfer of ownership of the stadium to a CCTO….will remove the debt servicing costs from being a direct charge on ratepayers”.

    That is because they become an operating cost against revenue.

    What happens is set out on page 28 of Athol Stephens’ affidavit and is referred to by the Court of Appeal at Clause 51 in their decision.

    I trust this is helpful. As I am not an accountant or professional advisor, I am not going to venture out of my field of knowledge unlike some others are wont to do!

    But I can count the goals and there is no “$200m”.

    • Elizabeth

      Have added the link to the affidavits of Jim Harland and Athol Stephens to the post above, find it under the court link for the Decision.

      The affidavit link was previously provided in submerged comment thread for the post STS day in court (comment #7746).
      It’s now easier to search, relevant to ongoing discussion here.

  105. Rosemary

    Richard, you keep confusing “ratepayers” with “citizens of Dunedin”. As a result you think you can infer from the fact that the “debt servicing costs [are not a] direct charge on ratepayers” (and you mean is not a direct charge on the rates, & I’m not quarrelling & never have, with this claim) that it is not being paid by the citizens of Dunedin. But this does not follow. Wherever revenue from assets owned by the citizens of Dunedin is spent, it constitutes an expenditure made by the citizens of Dunedin. It worries me a little that you haven’t grasped this.

  106. Rosemary

    Thanks Elizabeth; but of course I’ve had copies open, along with the decision, on my computer since whenever… What I WOULD like a squizz at, though, is Barton’s written submission to the appeal court – the one which advances the already-known-to-be-fallacious argument that the government’s $15m offset the shortfall of $13m. It would be nice to know whether he was trying it on in the hope of confusing the court of appeal or was himself confused. (Honi soit qui mal y pense, Richard.)

    • Elizabeth

      Presumably this is available via the Court of Appeal or DCC.
      Or…
      Richard – do you have a pdf/word document, or the print copy handy for scanning? I can post whatever, or DCC might like to post it on their website, then I can upload the link.

  107. Richard

    Sorry, Elizabeth – I don’t. It may be on the Court of Appeal site, I do not know.

    In any case, what Rosemary is suggesting would be totally at odds with what is in Jim Harland’s and Athol Stephens’ affidavits.

  108. Richard

    Addendum: Something jogged my memory. I have checked and see what Rosemary is getting at – clause 44. It would seem to have come from the original submissions (or whatever) in the High Court. Only counsel could answer that. The main point, however, is that Mr Barton accepted (the error) in his oral submissions.

    This all highlights the problem of taking bits and pieces of the decision in isolation.

    The definitive line is Clause 59 – “the appeal is dismissed”.

    I leave it at that.

    • Elizabeth

      Rosemary – to contact the Court, suggest send them a fax request:

      Court of Appeal
      Cnr Molesworth & Aitken Streets, Wellington
      PO Box 1606, Wellington
      Phone: 04 914 3540
      Fax: 04 914 3570

      The reference is:
      Stop the Stadium Society Inc v Dunedin City Council CA 269/2009

      You might want all counsels’ written submissions to balance up any critique:

      L A Andersen and K P Lane for Appellant
      F B Barton and M B Couling for Respondent

  109. Rosemary

    Richard, you really should read my posts (and the decision) more carefully: I quoted the paragraph (and it’s paragraph 45, not 44) twice yesterday, the first time capitalising the relevant bit.

    {Rosemary – your comment has been moderated. EK}

  110. Rosemary

    Yes, Elizabeth, I’ll follow that up tomorrow.

  111. Richard

    Yes, Rosemary, it is 45 not 44. Sorry.

    You just have to get things in context. This forensic dissection is not taking us anywhere other than down a path which is highly questionable

    I will not be commenting further.

    {Richard – your comment has been moderated. EK}

  112. Rosemary

    Good. No need for you to post further. You have told us what was known to council and when. The affadavits tell us what was known to the council officers and when. The justices have told us on whose behalf the argument was mounted, whom it succeeded in convincing and that that conviction was misplaced; they have told us it was mounted a second time and that it was finally withdrawn.

    I am now applying for a copy of Mr Barton’s submission on behalf of council so I can satisfy in my own mind Jane Bennet’s conundrum.

  113. David

    Rosemary – the council is still advertising on their website, under the main heading

    “How much is the stadium going to cost?

    …Dunedin City Council: $85.0 million ”

    They continue to mislead ratepayers with false numbers.

    These numbers have been wrong for so long you’d have to question if it is deliberate, or just really incompetent.

  114. James

    These numbers have been wrong for so long you’d have to question if it is deliberate, or just really incompetent.

    That seems all too common for websites. You would hope that the council might be better, but it’s not, and it’s not just that information that could do with updating. I was trying to find some information on hiring the Chinese Garden for a private function, and the information is ‘yet to be established’, and although it has been changed recently, I wonder the need to point out that a facility will be available after October 2008…
    http://www.dunedin.govt.nz/facilities/dunedin_chinese_garden/chinese2

  115. Rosemary

    David, I think Richard was the one who defended the council for its competence. I can only believe him. You may think this reflects on its intentions, but I couldn’t possibly say.

  116. Rosemary

    Oops. delete the apostrophe s after council.

    {Rosemary – done. EK}

  117. Richard

    There have been staff changes in that section of council with some gaps in replacements. I have noted the comments re out-of-date info on the website and am forwarding them to the relevant manager.

    David: C’mon: the relevant postings and documents elsewhere are up-to-date as you well know!

    James: the ‘old fashioned telephone’ is probably best! The Acting Manager at the Gardens is on 471 7358, if no response, direct your enquiry through 477 4000. If you prefer, the new way, through the form on the website.

    EK: thanks for acting! In the interest of everyone.

    Now, I have other things to do today. None are related to ‘stadium’, tea-leaves or entrails.

  118. Richard

    Rosemary: I haven’t “defended council” or anyone. I have simply set out what the position is.

    Whatever you think. Fine! Whatever you do is not going to change the Court’s decision.

    And that is the fact we are all left with when we run out of opinions.

  119. David

    Richard – the wrong information is on the MAIN PAGE that informs ratepayers of the cost.

    It’s not as if the stadium is an issue that’s been below the public radar for the last couple of years.

    It’s a fundamental error, and what’s worse the fundamental error is then presented as evidence to help win a court case.

    And you wonder why people no longer trust or even believe what the council says.

    {David – your message has been moderated. EK}

  120. meg55

    Tea leaves and entrails, Richard? You mean like Athol Stephens predicting what interest rates will be in 20 years’ time? Not casting aspersions. Nobody could possibly state that as fact. All I’m pointing out is that the judge’s decision rested on this prediction. Doesn’t the council rely on opinion as well as fact?

  121. Richard

    David – just back to check something else. I have found the page you referred to. It was last reviewed back in 2008.

    Your point is made and I have referred it already for attention. I will post the response when I receive it.

  122. James

    Hi Richard — Thanks. We did end up using the old telephone route, it was just a relevant example of where the website could be more up to date. So thanks for drawing it to the attention of the relevant people.

  123. David

    Thanks Richard – for anybody going to the DCC site, this would be the page to find out costs, and I think there’s probably quite a few figures that are wrong (i.e. total cost, DCC contribution, OCT contribution)

  124. Richard

    James: The problem is that for the website team to put the info up, they need someone to give them the information and/or someone to point out there is something out-of-date.

    Sean puts it this way: “We admit that there are annoying little bits and pieces on the web that are out of date and at times unfortunately these errors come back and bite us in the leg. We are working on fixing it as much as we can. I wish these people would let us know if there’s something not right on the web”.

    So, while this can be done through a post on the DCC website, there may be something more direct. I have asked Sean about that.

    David: your point is somewhat different although valid. As I read it, the content of that page states the position as at a certain date. Whether that page should be updated or just POINT to a later update is a moot point. I have raised that for discussion.

  125. David

    Richard – the page is the main page people go to, to find out the cost of the stadium – there’s not really anything to say it is a historical page with out of date figures that turned out to be wrong.

    I understand keeping everything up to date on a large website is a difficult task, but I thought the council would have been right on top of something that’s been the most prominent issue in Dunedin for the last two years.

  126. Richard

    David: I agree with you. Others may, however, argue that it is better to update by adding a new page so everything is there in chronological order. I think that would be confusing for the reason you mention.

  127. Hi All

    I thought I’d jump in and respond to a few questions on this thread.

    I have sent the stadium cost page (
    http://www.dunedin.govt.nz/council-projects/stadium/cost-of-the-project) to the previous webmaster to find out who is looking after the content of Stadium page on the website so I can ask them to review what’s on that page and update it to make it current.

    Documents order: The documents (in PDF format) that we add to the page are sorted by the date they are created. The PDF on top of the page (Affidafit) for example, was the latest addition to that section. It went up as soon as we’re asked to put it up.

    One irritating problem with our web system at the moment is that – we’re using a caching bucket in the web back end system so a page will load in short time. The trade off of this treatment is that many times the page has to be refreshed manually by pressing CTRL F5. Otherwise, you will see the “Cached version” of the page which displays information as when they’re put up last time the page was refreshed.

    We are working on fixing this problem.

    Richard:
    I took your suggestion on board and have put up a Website Feedback notice on the homepage of the DCC site.

    David, James:

    I agree with you that

    “..the council would have been right on top of something that’s been the most prominent issue in Dunedin for the last two years…”

    But many times, the web team is often one of the last units to know these things and as much as we are trying hard to be proactive about getting things up to date on the web, there’s always something we miss and unless we get the heads up from you guys, we will always be on the assumption that if we don’t get request for updates from the content owner, all is ok. – which is not ideal and it needs to change.

    Thanks again Richard for bringing this issue up to my attention.

    In this new role, I rely very much on extra pair of eyes and thoughts from the outside world to enable me to do some work to improve the web services here at the DCC.

    • Elizabeth

      Thanks Sean – welcome from Paul and I @ What if? Appreciate the feedback. Excellent.
      Those of us using DCC website will keep you posted on council page content, any suggestions etc, for sure.

  128. Richard

    Meg: Just to close off on the subject, Athol Stephens has not, of course, done that as any reference to Clause 59 of his affidavit shows.

    There is a difference between predictions and ASSUMPTIONS. Assumptions need to be made for for any kind of long-term budgeting.

    The assumptions are accordingly made over every capital project that the DCC is undertaking including wastewater, OSM, Dunedin Centre/Town Hall redevelopment etc as well as to the stadium.

    And, they would apply too if an 800 seat theatre was “in the mix”.

  129. meg55

    Richard, I will bow to Elizabeth’s wish that we should move on. However, it is annoying that you always insist on having the last word. Predictions, assumptions, opinions, whatever – my point was that these do have their place, as you acknowledge. Your implication in previous posts that the council deals with facts and is therefore superior to the rest of us benighted mortals who rely on opinion is illfounded.

  130. Richard

    Meg: All I wanted to record was that it is a mandatory requirement that this sort of assumption (which is what it is) needs to be made for both inflation and interest in Annual and Community Plans.

  131. Caz

    Hi Richard
    After reading all this boring stuff, there’s one thing I want to ask you.
    Will you be trying to get elected again next year?
    Or will you gracefully depart?

  132. Richard

    Thank you for your interest. If it is so boring, why bother reading it?

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s