Stadium: private sector funding

### ODT Online Thu, 2 Dec 2010
$2.7m donated to stadium
By Stu Oldham
Four anonymous benefactors have donated $2.7 million to Dunedin’s new stadium, pitching total fundraising close to $38 million. Two of the donations are in the very high hundreds of thousands of dollars, and two more are in the hundreds of thousands of dollars.

The Carisbrook Stadium Trust, and by extension DVML, was tasked to raise $45.5 million toward the stadium project.

Read more

****

On changes to the stadium layout, options for the Academy of Sport moving to the back of the North Stand, and relocatable seating…

### ODT Online Thu, 2 Dec 2010
New plans for media box
By Stu Oldham
Sports journalists may get a different home in the Forsyth Barr Stadium, as its developers look for new ways to maximise its income. The Carisbrook Stadium Trust is considering moving the media box from the south to the north stand in a move it hopes will ultimately be cost-neutral.

[It] would mean the venue had more seats and corporate packages to sell, and more chance to develop a solid stream of new operational income.

Read more

Post by Elizabeth Kerr

80 Comments

Filed under Architecture, Construction, Design, Economics, Project management, Site, Sport, Stadiums

80 responses to “Stadium: private sector funding

  1. Russell Garbutt

    Intriguing that at this stage, the private sector funding has leapt from $30 to $2.7 million, when the target is $45.5 million.

    Good on the mysterious benefactors that this money has been donated, but it does underline the continuing BS about future operational revenue still being counted as private sector funding. It ain’t. And endlessly repeating that it is won’t change the fact.

    Until the little mystery of the “habitual investors” of DCC debt are identified, there is always the lingering thought that the benefactors of this windfall may have felt persuaded to return some of their profits to the project that caused the windfall, but until we see clarity and transparency in DCC dealings, all these doubts will continue to gain momentum.

  2. Peter

    But, Russell, a new dawn has arrived with the election of a new council!

  3. Anne

    “Private sector funding” is such a misnomer for pre-sold revenue but it seems nobody is objecting to this fraud.

  4. Phil

    “Private Sector Funding”, in this case, also includes “Public Sector Funding”, being the $15 million grant received from central government. Probably extends to include lottery board funding and community trust funding as well. It covers pretty much everything except for stuff that people find out about.

  5. Richard

    The continuing claims or assumptions both here – but more particularly at ODT Online by one ‘MikeStk’ – that revenue from the sale of private sector products (corporate suites, open club reserves, lounge memberships, sponsorships etc), all relates to paying operational expenditure are wrong.

    As Athol Stephens, DCC General Manager, Corporate and Finance, has patiently explained on many occasions (including, I understand, individual discussions with at least two contributors to ‘What If’), accounting standards prescribe how transactions are recorded.

    If the sale of a right to use or lease a corporate suite, paid over 10 years, has all the characteristics of revenue (as defined by accounting standards), it will be recorded as revenue.

    Likewise, operating expense will be recorded as just that.

    In the instances being talked about, the revenue from the sale of the private sector products will exceed the operating costs and the difference ie the surplus is to be used to repay debt.

    So, the more private sector products (corporate suites, open club reserves, lounge memberships, sponsorships etc) that are sold, the more there will be by way of a cash surplus for the repayment of debt.

    I will ask Elizabeth to insert a graph that shows how it works. As far as I know, this has not changed.

  6. Calvin Oaten

    Again, Guy Hedderwick trumpets the private funding for the new stadium. But ask to see an audited statement of account showing exactly where these monies reside and all you hear are the sound of rabidly receding hoofbeats. I particularly like Richard’s take that the surplus of what the ‘private funders’ pay for their ‘jollies’ and the cost of providing them will be used to reduce debt. So, what he is saying is that these incredibly naive people (him being one of them) are paying way over the top for the privilege of purchasing preferential seats, corporate boxes etc. If not, then there would be no surplus to reduce debt. If true, this proves that ‘rugby nuts’ are just that.
    Meanwhile, Malcolm tells us that he and Stewart Barnett are busy negotiating with suppliers of the 5,000 relocatable seats needed for the stadium. Hold on? Malcolm you actually need 10,500 if you are to meet IRB’s requirement of seating for 30,000. That’s if you can believe that there will be 19,500 permanent seats constructed. Rob Hamlin figures on just 17,500. Malcolm says that these seats would be funded out of the operational budget. What? So Malcolm, how can that be, when the operational budget is funded by revenue at the turnstiles, and Richard tells us that any surplus over costs are to be used for debt reduction? Is that the sound of more rapidly receding hoofbeats together with ‘Hi Ho Silver’, I hear. Apologies to the Saturday morning State Theatre Chums Club. Circa 1946.

    {This comment also appeared at ODT Online. The online editor subsequently pulled it from their website. -Eds}

  7. Richard

    Calvin: it is not “my take”. It is as explained by Athol Stephens on many occasions. Of course there is a ‘premium’ for things like a corporate box over (say) just buying a seat! And that returns ‘a surplus’.

  8. Calvin Oaten

    Richard; you too must have been a member of the ‘State Theatre Chums Club’. It doesn’t matter how many times Athol Stephens explains, the fact is the numbers just don’t add up. Ask Malcolm where the difference between the costs of providing the facilities with the ‘premium’ you claim for debt reduction, and the cash for the relocatable seating comes from. You will be deafened by the silence.

  9. Russell Garbutt

    Ah, just believe…but I for one will only start to believe when I see published for all to see, the contributing data to what Richard claims.

    That is
    1 the final debt including depreciation and interest for the project – and that includes all of the project, not just the bits that someone wants to include or exclude
    2 the final projected annual operating costs of the stadium over the period where costs of debt are still being incurred
    3 the final projected annual income of the stadium including all incomes projected from professional rugby activities over the same period
    4 the repayment schedule for all debt incurred by the stadium activity

    Richard claims that ” the revenue from the sale of the private sector products will exceed the operating costs and the difference ie the surplus is to be used to repay debt”.

    Prove it.

    I was interested to hear the comments on Radio Live this morning when the subject of countries building purpose built stadia for future World Cup Soccer came up. The comments were along the lines of no-one seems to think past the event and what on earth will multiple stadia be used for in the future. Interesting the next comment was about the FUBAR stadium in Dunedin and “apart from a possible military tattoo and a concert by Susan Boyle, it was hard to see what could possibly fill a 50,000 seat stadium in Dunedin?”

    We have been asking the same question ever since Malcolm Farry and his mates first put this idea up, and still no answers have come forth. But then of course, it isn’t a 50,000 seat stadium, it is a 17,242 seat football ground.

    The last comment was that of 10 events put on in stadia or concert halls in NZ, generally 3 or 4 lost money, 3 or 4 broke even, and 3 returned a profit. That was when experienced and professional people were involved. But we have been told that we will do it the southern way, and so we can rely on events such as papal visits, royal tours and World Swimming Champs to buck the results of the experienced.

  10. Calvin Oaten

    Russell, do you seriously expect Richard to answer those 4 points? Of course he can’t. No-one can, because there are no facts upon which the answers can be based. We will just have wait and see, by which time it will be way too late to modify anything. Quite frightening really. We really might need a ‘Papal’ visit, red shoes and all.

  11. Richard

    I do not have to answer anything. I am not even expressing opinion. As for the relocatable seats, well – as I recall it – some will be owned by DVL or DVML, others will be hired in as required with the cost of hire and installation recovered within the ticket cost, ie “an operational cost”. Simple really. If you and Russell want to act like “Irish bankers” so be it.

  12. Russell Garbutt

    Richard, as he says, doesn’t need to answer anything, but he is claiming that surpluses in revenue will be used to repay debt – and if that isn’t an opinion or one of his “own facts” then I don’t know what it is. Problem is that there isn’t one shred of evidence in the public domain (and this is public money that is being used to create this whole mess) that can show that there will be any operating surpluses at all. And Richard, in his past role as Chair of Finance and Strategy, would surely be privy to any such evidence.

    Forget the diversionary talk about hiring in seats – I’m talking overall operating costs and revenue, not individual bookings that may require any further seating than the 17,242 being provided.

    So, I guess we can conclude that no such evidence for any operating surpluses exists.

  13. Calvin Oaten

    Richard; if the relocatable seats are hired in as required, it is hard to know what they would be hired for other than the WRC and other rugby tests. As the NZRFU takes the gate for tests and pays the ORFU a match fee, how will the hire portion of the ticket price be itemised out, and will the NZRFU and IRB be happy at the reduced take? If, on the other hand, the hire fee is added to the cost of the ticket how do you think the public will accept that? Perhaps Malcolm can answer that.

    • Elizabeth

      If Councillors are reading comments here, perhaps you can raise these or similar questions at the appropriate Council meeting asap. Thanks.

      The current chair for Finance, Strategy and Development is Cr Syd Brown – who doesn’t blog.

  14. Phil

    I would assume that the cost for the hire of additional seating would be built into the ticket price. Which, as you point out, is taken by the NZRFU who pay a set fee based on the number of spectators at the ground. Looking at it in realistic terms, we’re only talking about once or twice a year that the extra seats will be required. Test matches are the only time that rugby in Dunedin will require more than 17,000 seats. Sorry, I don’t care if it’s a new stadium, indoors, it’s own web page, and all that. Auckland doesn’t even manage 10,000 people to a football game. That’s just the nature of football support in NZ today. Yes, we might host a final again, just like in the glory days that we all cling to. But folks, that ain’t gonna happen. So the ticket prices for test matches will be set higher than for non test match fixtures, to incude for the cost of extra seating. Or, alternatively (but unlikely) non test match tickets will be at a significantly reduced price due to the reduced facilities available for those events. What is more likely is that the cost for hiring of additional seating for 2 days a year will be spread across the ticket prices for all matches. Which the NZRFU would be quite pleased about.

  15. Calvin Oaten

    So Phil, how does DVML get the money from NZRFU in order to pay for the hire of the seats? Remember, the NZRFU only pay a match fee. Or does the ORFU have tickets designating a sum for the right to sit, a sum for the hire of the seat and GST, total XYZ? The NZRFU only gets the portion, the right to sit? This immediately raises the problem of apportioning the GST. And it all just keeps getting sillier and sillier, as indeed the whole stadium fiasco is.

    • Elizabeth

      In today’s print and digital editions of ODT, a letter to the editor by one Roderick Keable of Allanton – under the title “Positive issues ignored” (page 34). Mr Keable feels it necessary to hold up binary arguments against Calvin Oaten’s “sensationalist fiction” (ODT 2.12.10) as he terms it – and thus enters a little essay about the city needing “hard-working people unselfishly giving their all and returning positive results for the city that they believe in for a positive future”, in the context of the stadium project. I retrieved a box of tissues in sympathy with the good citizen of Allanton. I love, with all sentimentality, a bold and wicked defence of the old boy network. Plucks at the heart strings. I’ll be quite recovered by Monday.

  16. Calvin Oaten

    Elizabeth; I certainly hope so. It pains me to think of you as poorly. As a matter of interest I have responded to Mr Keable. Well it would be rude not to wouldn’t it? Of course it relies on the ODT to play its part.

  17. peter

    Yes, a tiresome return to the ‘naysayer’ label for anyone who dares question the looting of the city’s finances to pay for a debt ridden private sector facility that caters for their interests only. He doesn’t identify any of those hard-working, ‘unselfish’ people, who have worked ‘for free’, but we can guess who.

    • Elizabeth

      ### ch9.co.nz December 3, 2010 – 8:46pm
      Notable visitors take a look at the Forsyth Barr Stadium
      With the Rugby World Cup less than a year away, interest in Dunedin’s venue for the tournament is growing. Yesterday management from the Georgian side took a look at the stadium, as did a former All Black great who would have loved the luxury of playing indoors.
      Video

  18. Phil

    One thing you can be sure of, Calvin, is the the NZRFU will not be paying more for a match in Dunedin than they pay today. Particularly as their attendance revenue is likely to be less than at Carisbrook. NZRFU are horrendously cash poor, so they are unlikely to be interested in subsidising seat rentals, big screen rentals, or any other such things. DVML will receive a fee from ORFU, predetermined by NZRFU, from which they will have to cover their operational and maintenance costs for the event (excluding revenue from the pie vendor).

  19. Richard

    Hi Phil
    I could check back on the hire agreement with the ORFU which, I think, was countersigned by the NZRFU.

    Whatever, as I recall it, the ‘match fee’ is something that NZRFU pay the hosting rugby union, ARFU, WRFU, CRFU, ORFU etc for organising and local promotion of a test. In the case of the ORFU, it may have been on a different basis and included hire of the ground which, of course, was owned by the ORFU.

    As Eden Park, Westpac Stadium are owned and administered by Trusts and AMI by CCC’s V-base Limited, one would have to assume that the hire of the stadium and ‘the match fee’ are quite separate.

    As for revenue, Forsyth Barr offers more prime/good seats than The Brook (something like 4 times more = 12,000 as I remember) so in that respect it will meet NZRFU requirements! In fact, if you cast your mind back, that was the reason for the ORFU coming to the two councils eight years ago with their prosal to rebuild the main stand at Carisbrook. And that, of course, is where it all started.

  20. Russell Garbutt

    I still have in front of me the notes of a meeting I took with the then CEO of the Carisbrook Stadium Trust, Ewan Soper.

    The income to the stadium was noted to be 15% of any NZ Cup or Super 14 rugby match and 7.5% from any NZRU match. In addition there were 3 minor concerts per year returning $5k per concert and 1 major concert returning $10k – these resulting from charging 15% of the gate.

    These incomes are a pittance and based on present attendances show that the many assertions – the latest by Richard Walls – that the excess of revenue over costs of operating the stadium would be used to contribute to capital is simply a nonsense and has always been a nonsense.

  21. Calvin Oaten

    Well Phil, let’s hope they can sell a lot of pies. Richard is talking pie in the sky. 12,000 prime seats count for nothing if there isn’t a total capacity of 30,000. I think there are some serious problems in this matter that haven’t been properly addressed. Malcolm fondly hopes the NZRFU will be generously accommodating, but the fact is they don’t actually need Dunedin as a venue. Not now they have the expanded capacities of Auckland, Wellington and Christchurch. They are always going to favour the venue with the most chance of maximising the revenue. So look for the very occasional “B” test. Perhaps three or four a decade.

  22. Richard

    For goodness sake Russell, go back and read my post. For once, pay me the simple courtesy of reading my post, instead of suiting it to your “own what you think I wrote. I was referring to the private sector funding, ie the sale of the various products such as corporate boxes etc. Nothing else. How else would the ‘bridging loan be paid”? Unfortunately Elizabeth is unable to post the diagram. Nevertheless it would be great if you would stick to the bloody point for once.

    {Apologies Richard, the graph is with the site owner for posting. -Eds}

  23. Richard

    Thanks, Elizabeth. No apology necessary. I find all sorts of technical things on my website that I don’t understand … but I am learning!

    {Richard, the graph is scaled and cropped, and saved for insertion at the Media Library but for some reason publishes at twice the size… we’re very keen to blame Pilcrow, the new template forced on us by WordPress – it’s not as clean as Pressrow to look at and has acknowledged image and video formatting issues – rather we’re tarred as human error until Paul saves the day, Monday. -Eds}

  24. Russell Garbutt

    The point is Richard that you claim that ” the revenue from the sale of the private sector products will exceed the operating costs and the difference ie the surplus is to be used to repay debt”.

    What evidence can you publish that will substantiate this claim?

    I believe that in order to do so, the questions I asked above need to be answered with authority – they are listed again.

    What is:
    1 the final debt including depreciation and interest for the project – and that includes all of the project, not just the bits that someone wants to include or exclude
    2 the final projected annual operating costs of the stadium over the period where costs of debt are still being incurred
    3 the final projected annual income of the stadium including all incomes projected from professional rugby activities over the same period
    4 the repayment schedule for all debt incurred by the stadium activity

  25. Richard

    The heading for this topic is ‘Stadium: Private Sector Funding.’ That is all I addressed. I am not interested in your continued obsession and concentration on with ‘professional rugby’. As for your other tiresome questions: do your own legwork.

  26. Phil

    I believe that you are correct, Richard. The NZRFU takes 100% of the gate takings from the venue. They then give a fixed percentage (determined solely by themselves) back to the local union. In our case, the ORFU. The percentage figures sound similar to those mentioned by Russell. The actual percentages paid for various rugby fixtures have been posted here previously. From that sum, the local union retains a percentage. That, I believe, is the “match fee”, as it is the local union who hires the venue from the venue owner and arranges the match. The remaining balance of the money given by the NZRFU to the local union is handed over by the local union to the venue owner as a venue hire fee. Previously the ORFU have retained both the match fee and the venue hire fee, as the recipients were the one and the same. From the RWC forward, they will retain just the match fee.

  27. Russell Garbutt

    As I thought Richard – you have absolutely no evidence to support your continued assertion that there will be any surplus – let alone any to go towards private funding capital.

    All of the questions I’ve asked are at the core of whether this City should have built a new rugby stadium, and in your previous position you should have addressed those to determine whether you supported it or not. No ratepayer should have to do any “legwork” to know where their money has gone – it should all be in the public domain.

  28. Richard

    “As you thought”!!!! Do you ever think of anyone else but yourself, Russell? You expect me to “run after you”. Come on!

    Fact is, I did my ‘homework’ as a councillor. That is why I came to support the new Stadium.

    You have been against it from the start. You have never had an open mind about it all. You reject any other p-o-v. You dismiss the piles of information that you have sought from council staff as well as me.

    So, what’s the point of feeding your obssession? Nothing you say – and have said for yonks now – carries any credibility. None at all!

    Get a life!

  29. Russell Garbutt

    I suppose this sort of response would indicate one of the reasons why the electorate rejected you.

  30. Calvin Oaten

    Richard; you did your homework. You and all the other stadium support councillors. It would seem the ‘homework’ consisted of receiving and listening to reports from the CST, various consultants (employed to find reasons to proceed) and not much else. The result is that the people have been hi-jacked into funding the project. When an earnest citizen like Russell Garbutt investigates and asks some serious questions you dismiss them as self seeking close minded obsessions. That is your trade mark method of evading issues. Attack and kill the messenger. The whole stadium campaign has been run along these lines. Ask Malcolm to show an audited statement of account showing where the ‘private funding’ monies are and… silence… Ask where the budget for the temporary seating is… silence… Ask why you, Peter Chin and the crooked lawyer are no longer in the party and the answer is the people are belatedly waking up to just what a bunch of dunderheads were running the city. If the election was twelve months from now the result would likely be a total clean-out.

  31. peter

    Yes, Calvin, this ‘doing homework’ is crap. If Richard – or any of the other councillors had done their homework – this stadium should not have happened. We know of one ‘little’ bit of homework Richard and his mates did not do and that was to ask for the appendices to the 2007 CST Feasibility Report, which contained the consultants’ reports. Only Cr Lee Vandervis enquired about them. Bev chased that one up by asking for them herself – as well as the blacked out bits – much to their embarrassment – which was hardly her fault – but their stupidity.

  32. Calvin Oaten

    Phil; in the MWH 2004 report commissioned by the ORFU, it states: “The NZRFU does not provide any direct funding assistance towards the development of stadia facilities. However, it does pay a management fee for test matches and a KPI payment based on performance.” (This has amounted to about $75,000 per test match for the ORFU in recent years).
    Elsewhere it states minimum standards for the allocation of test matches.
    Stadium capacity: ‘A’ tests 30,000-35,000. ‘B’ tests 25,000-35,000.
    Seating capacity: ‘A’ tests preferably all, but some standing on terraces acceptable. ‘B’ tests ditto for ‘A’.
    Covered seating capacity: ‘A’ tests 10,000 (in premium location). ‘B’ tests 7,500 (in premium location).
    Hospitality facilities (on-site function area available for NZRFU use at test matches).
    Ability to meet NZRFU commercial requirements for prime seating, hospitality and pourage.
    A specified number of international quality hotel beds, and the capacity of the airport and other transport.

    These are just the basic requirements, and to me it looks like the stadium presently being constructed misses on more than a few criteria. A blind faith that the NZRFU will vary its requirements to fit, and the prospects of any meaningful income to the DVML from test matches of either category look decidedly flimsy. Which can only mean the burden will/must fall squarely on the shoulders of the ratepayers. A foreboding thought.

  33. James

    Interesting information Calvin. However, if Richard’s suggestion that the new Stadium has 12,000 premium seats, that is more than required for an A test, and apparently 4 times more than Carisbrook. Presumably it will also provide better on-site function facilities for NZRFU. So at least on these criteria, the KPI payment might be higher. Curious to know how hotel and airport capacity stacks up, especially with Pacific Blue’s departure.

  34. peter

    Does anyone know the date when it was decided to hold the RWC in NZ in 2011?

  35. UglyBob

    Or to be more accurate 17 November 2005

  36. Calvin Oaten

    James; yes the premium seats qualify, but it is way short of the 30 to 35,000 total. Then of course, the on site function facilities you mention will only measure up if there is a kitchen installed. This, we are led to believe is to be supplied by the successful catering tenderer at their cost. A big ask on such a tenuous prospect of a payback. Then of course the temporary seats to make up the number required (essential for the RWC) are an additional cost as well. Perhaps Richard could explain the answers to where the funding is coming from seeing as any surplus from the operational expenses are earmarked for debt reduction, according to him.

  37. Calvin Oaten

    Ugly Bob; yes, 17 November 2005. Malcolm announced that “there was going to be a new stand-alone stadium built in conjunction with the University, it would have a roof and would cost not a cent more than $188 million. And further, there would be no call on the ratepayers to fund it. It would be funded out of existing budgets, otherwise he wanted no part of it.” We all know how it progressed from then.

  38. peter

    And, of course, we now have the mantra of the ‘multi use’ stadium being ready for the RWC ‘on time and on budget’. Still enough suckers out there to swallow that one – including on the Council.

  39. UglyBob

    Calvin: I think you’ll find that 17 November 2005 was the IRB announcement in Dublin awarding NZ RWC 2011 and that CST made announcements re the possibility of the new stadium in August 2006. Media reports from the time that I can find do not substantiate oft repeated claims that there would be no call whatsoever on ratepayer funds. Still this is very old gristle or perhaps I should say grizzle, something to which you are eminently fitted.

  40. peter

    Ugly Bob, I think you suffer from selective memory. This early call claiming the stadium would be privately funded is common knowledge. ‘No stone left unturned’ to avoid ratepayer funding is etched in the memories of those who know – or care.

  41. UglyBob

    Peter: the who said what game has been played out many times by pro and anti-stadia folk and I don’t recall any resolution other than some anti-folk claiming that they were at the meetings where Mr Farry allegedly made the pronouncements. I know the ODT and NZ Herald articles referenced on the Skyscrapercity site from that time don’t include the claim although they do make reference to significant financial input from Otago University. Anyway, it’s a topic that’s been done to death.

  42. Calvin Oaten

    Ugly Bob; you are absolutely right. I have the dates wrong. It was August 2006 when Malcolm made the announcement. I, and some friends were present, in the Skeggs Gallery. And yes he did say what I claimed verbatim. As you say it is a topic that has been done to death, except it won’t lie down. Do you think that might be because of the injustice of it all? As the saga unfolds we will see more and more the great con that it is.

  43. UglyBob

    Calvin: If you use winches even a dead horse can still stand.

  44. peter

    Quite right, Calvin. Why should we shut up just because of ‘The Inconvenient Truth’ concerning the stadium? I, for one, am more than happy to put the boot into this con job that has been foisted onto the good people of Dunedin.

  45. Calvin Oaten

    Ugly Bob; just keep your winches handy. You might just get the opportunity to lift the biggest dead horse ever seen. This one would bring tears to Helen of Troy’s eyes.

  46. Richard

    Thanks for the wizardry, Paul. Should explain the private sector funding although whether some accept it is moot.

    As for this ‘shooting the messenger’ stuff. It really has me chuckling. Really! Russell managed to ‘shoot himself in the foot’ while Calvin just stresses out dodging my return fire. Both, I understand, treated by the ‘field hospital’.

    Now, as is their wont, they have run away from the fire and switched from ‘Private Sector Funding’ to another target, the old Art Gallery failing to notice that you posted it as a separate topic some days ago.

    That’s it from me. Cheers!

  47. Calvin Oaten

    Running away from Richard’s return fire? I am waiting patiently for any fire from Richard, return or otherwise. I suspect he only fires blanks. He certainly doesn’t fire any real world information. Anyway, you wouldn’t have to run from his fire of any sort. A casual stroll would suffice.

  48. Russell Garbutt

    Ah Richard, he has nothing to say, and he has said it.

  49. JimmyJones

    Richard, your graph in no way indicates any profit or surplus.
    I want to correct some errors in your first post:
    – you say that Athol Stephens has explained things to you, but on various occasions he has admitted (at a DAP meeting and implied in various documents) that the FB Stadium will run at a loss. If he ever claimed that DVL was predicted to be profitable he would be breaching the Financial Reporting Act.
    – you say “the revenue from the sale of the private sector products will exceed the operating costs ~” but the plan is that the whole of the PSF revenue will be required to service the DVL “Bridging Loan” (about $29 million). This means that the meagre gate takings revenue will be all that is left to fund all the cash and non-cash expenses, and so DVL will generate a significant loss which will have to be ratepayer funded. No-one should forget that the “bridging loan” ($29m) adds to the DCC/Ratepayers debt mountain, and, that is in addition to the “shareholders advance” to DVL which makes a total of $135 million of stadium debt. This is the very same debt that the DCC council agreed should be reduced from $91.4 million because $91.4 million was too much. The $135 million was revealed in a report to the last FSD Committee and reported in the ODT $250m rise in DCC borrowing capacity (well done ODT). In the Harland/Stephens Affidavit the figure is not obvious, but was $ 139 million at that time. If this is a nasty surprize to our councilors then I suggest that they prepare themselves in case there is some more bad news in the near future. If they feel like they have been tricked, or don’t have a bloody clue about what is going on, then the answer is in their hands.

  50. Elizabeth

    Apologies JimmyJones, for late approvals to your two comments. WordPress sent them to moderation due to the number of urls you entered. We’ve been offline until now. We trashed the second one since it’s a repeat of the first. -Eds

  51. Richard

    Jimmy Jones: my references relate solely to the ‘private sector products’ and how it is separated nothing else. The chart is not mine, its origin is shown at the foot.

  52. JimmyJones

    Yes Richard, I understand; I decided to cover some points beyond what you discussed.

  53. Dave

    Gosh is this still going on? I thought with the “new” Council” you lot would be happy. You know, the much vaunted “democracy” that was screamed for by the….now what was the word?……ah yes, 80% of Dunedin voters that opposed the Stadium. There was one other term used as well…..of course!….majority. Seems even this can’t assuage your anger. I mean how long will you go on? But I’m sadly and quickly coming to the conclusion that no matter what happens in this wonderful City, and no matter who is elected, or what is proposed you will always find something to moan about. I mean, look out the window, life is rapidly passing you all by. Although for some of you, it seems, this issue is all you have. Richard, bad luck on the election, seems the luddites won in your case.

    • Elizabeth

      Classic blinkers, “Dave”. Some here have very progressive projects for the economy and job creation going on that are not based on the heavy DCC error of intergenerational debt loading and the dying sport of rugby. Enough to fry your brain.

      • Elizabeth

        Oh yeah. For the reverential amongst you, file this under ‘popularity contests’.

        Forsyth Barr Stadium (aka DVML) is running a top stadium pic competition… Go to the Forsyth Barr Stadium facebook page and click on Contests.

        * PHASE ONE – Submit Your Entry (was: Nov 19 – Dec 5)
        * PHASE TWO – Public Vote (current: Dec 6 – Dec 17)
        * PHASE THREE – Winners Announced Dec 18

        [My camera lens fogs over if I point it at anything stadyum]

  54. Dave

    Thanks Elizabeth, and what prey tell are the “very progressive projects for the economy and job creation going on” ? that “some here” are involved in. I’d be very interested to here what they are and the jobs they create?

  55. Phil

    Like Wall Street, Dave ? That proved to be a stroke of genius, didn’t it.

  56. Hey I quite like Wall St – well 3/4 of it anyway. It’s just so weird to have a tenant like F&P there (should have been the Design School at the Uni but that’s for another story), and I just don’t get the design of the end where the Pharmacy is. It stops dead what should have been a street – more like Wall cul-de-sac than a street.

  57. Whether this makes it a ‘success’ in any objective sense, but I can’t spend more than about 20 minutes in the Meridian before wanting to run and leave. In contrast, I’m quite happy to linger over a coffee at Mojo in Wall Street.

  58. Dave

    Well, I was “seeking” an answer, but it seems the answer is ‘none’. Very progressive indeed. Ok, on that same note I quite like ‘Wall Street’ as well, it has a “busy” kind of feel about it. The Meridian reminds me of those awful ‘Super Malls” in Australia.

    • Elizabeth

      Hi Dave – the day you declare your identity and position is the day we might have a general conversation. As you will realise the stadium project has been less than transparent from a communications perspective in relation to funding and allegiances. Feel free to elaborate anything you think would help our readers understand the private sector funding, ORFU’s position, use of ratepayer monies and the obnoxious debt loading caused to the city council, thus ratepayers and residents. Oh, and how future stadium operations will be funded. See the topic of this thread. Go for broke.

  59. UglyBob

    Must admit that I rather like Wall Street myself – it’s a marked improvement on the old Deka. It always surprises me how many sticks in the mud it’s given rise to (and I’m not referring to the 19th century walkway).

  60. Phil

    Bob. I have nothing against the design of Wall Street, nor have I anything against the design of the new stadium. On the contrary, I think they are great designs with visual appeal. And certainly, as you say, an improvement on the former structures occupying the same space. I doubt that anyone on this site will dispute that. But, that shouldn’t be confused with the ongoing question as to whether or not either project was an appropriate and efficient use of limited financial resources. Call me a stick in the mud, but I like to consider such things when it’s my money that’s involved. I thought that the design for the Auckland waterfront stadium was also great, and looked really exciting. I was rather disappointed when it was rejected by the local authorities responsible. But that’s easy for me to say when I don’t live in Auckland and don’t have to deal with the liabilities of the project.

  61. UglyBob

    Phil: Perhaps I’m mistaken but I understand Wall Street was built using endowed property funds rather than as a charge on the rates; the decision to build on George St rather than say make further property investments in Hamilton or Auckland may not generate quite the same return (I don’t really know the mechanics) but I think it was admirable to invest in Dunedin thereby creating an amenity that presumably provides some commercial return and introduces new retail employment to the city – I would rather see developments like Wall Street than bulk retail strip mall type developments down the one-way system or Andersons Bay Road. I’d hazard to say that developments like Wall Street, the Chinese Garden, OSM and dare I say the stadium are beneficial beyond pure consideration of operational costs. Beside the obvious issue of sound employment opportunities, people choose to live in cities that offer good public amenities whether that’s parks, museums, galleries, shops, health care, educational institutions etc and in that regard Dunedin is well served. Accepted, there’s always the question of scarce resource/money, and ‘need’ versus ‘want’ to balance, especially when the public purse is concerned.

  62. Richard

    UB – you are correct in regard to the funding relating to the construction of ‘Wall Street’. Funds derived from the sale of any endowment property – including any capital gain – must be reinvested in property.

    City Property returns a ‘a dividend’ to the city each year. It makes no call on ‘rates’.

    When I joined the DCC in late 1980, the return from property (administered then by the Town Clerk’s Department by the ‘famous red book’) was – and this is “off the top-of-my-head” – about $200,000 maybe less. This is because most of the endowment land was tied up in ‘Glasgow leases’ of 21 years duration and in the terms of the original endowment, it could not be sold etc.

    The DCC subsequently sought an amendment to the terms via an Act of Parliament (as did the Presbyterian Church/Foundation Trust Board) which enables property to be sold and requires the funds thus realised to be reinvested in property. Apart from the vastly improved return (now $3m/$4m and growing) this has enabled the risk to be better spread.

    DCC Community Housing is (as previously posted), administered separately by City Property on ‘a breakeven basis’ for Community Development.

  63. ro

    This thread began with the news that $2.7m had been “donated” to the stadium. The news was followed by a stoush in council last month between Farry, asked to substantiate the donation, and Vandervis, which occupied the ODT to the exclusion of the substance of LV’s question. And so we (or I) never really learned whence it came or where it went.

    I think we can now account for about $1m of it. $605,000 was a grant from the New Zealand Community Trust, $50,000 from the Southern Trust, & $250,000 from the Alexander McMillan Trust. Seemingly none of this $905,000 went towards the private sector contribution to construction costs but went towards paying for some of those excluded items, like the reinforcing of the turf, that are currently giving council and us all such gyp.

    Did anyone discover the source of the other $1.8m or where it was put? Was it just the sales (promissory notes) of memberships and sponsorships for January 2010?

  64. Hype O'Thermia

    I heard that one particular local businessmen gave Malcolm a cheque for “between $5000 and $10,000” (I’m being tactfully non-specific here). I believe that as of very recent times it was not shown in the accounts. Apparently the donor of this substantial amount was told that Mr Farry had it in his “holding account”. Can someone who knows their way around the money-go-round records check that, please? Also, where is the interest going? To the stadium to offset the DCC’s debt mountain? He is not the only donor in the same position from what I have recently learned – I’m unwilling to name names at this stage because these men have not made these donations public nor expressed in public any curiosity they may feel about when the money is going to show up in the accounts, besides I am only certain of the names of 3 of them.

    Remember when Malcolm did say at a Council meeting (as reported in the ODT) that he already “had a cheque” for a few million in his pocket? Did it leave his pocket? Is the interest from that million helping out with Dunedin’s interest payments – or is it filtering away into “administration costs”, if so, paid to whom for what administration services?

    • Elizabeth

      Hype O’Thermia, we have plenty of space for these type ‘news’ items to feature here – eventually the donors will need to front to CST, DVML and DCC, anonymously or otherwise, to raise full accountability for CST / DVML / DVL and god knows what other weird ‘stadium’ accounts parcelled here, there and everywhere.

  65. Russell Garbutt

    So much depends on what the cheques were for of course. If they were to pay for a product, then the cash must appear in the balance sheet and be counted as revenue. If the cheque was for a donation whereby nothing was expected in return, then I would assume that it would go along with the $30 that apparently was recorded as the only other unencumbered donation to be put to private donations for construction.

    We know now after looking at the DVML and DVL Statements of Intent and their associated forecast financials that the private funding for construction is a total myth. Also pays to look at the statement of Mr Larsen who pointed out in his report that the expected revenue for DVML from stadium income is – let’s just say rose-tinted?

  66. Mike

    In other news – another stop the stadium kicks into higher gear:

    http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2012/01/08/BAL31MM8M3.DTL

    Check out the pie graphs on their home page:

    http://www.santaclaraplaysfair.org/

    See how promised ‘private funding’ has turned into public funding …. seem familiar? Well at least they got to vote, even if they were also duped.

  67. Calvin Oaten

    The whole procedure is a well proven formula. Compared with our experience here in Dunedin, only the names have been changed. Good luck to the ordinary Santa Clara folks, but I don’t like their chances.

  68. amanda kennedy

    This is so uncanny how similar it is to our situation here in Dunedin. I wonder if the main Santa Clara stadium proponent will be given the an award for duping the citizens with a socalled ‘Privately funded’ stadium that became a publicly funded one?

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