DCC and DCHL, was there ever any doubt?

### ODT Online Wed, 9 Feb 2011
Stadium debt may constrict DCC companies
By David Loughrey
The effects of servicing the debt being raised to pay for the Forsyth Barr Stadium is beginning to bite, with warnings Dunedin City Council-owned companies may struggle to take advantage of business opportunities that come their way. But amid the warnings came a reminder the period of tight financial times ahead was “spelled out in black and white” when decisions on the project were made.
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DVML commercial manager Guy Hedderwick said last night Delta still had a corporate suite at the stadium.

### ODT Online Wed, 9 Feb 2011
Delta pulls out of seating package
By David Loughrey
Delta Utilities has pulled the plug on a $100,000 seating package at the Forsyth Barr Stadium in Dunedin, a matter described as being the result of actions of an “overzealous” executive. The withdrawal from the package meant a loss of projected income for the company running the stadium, Dunedin Venues Management Ltd (DVML), of $100,000 over a 10-year period.
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Posted by Elizabeth Kerr

3 Comments

Filed under Construction, Economics, Politics, Project management, Stadiums

3 responses to “DCC and DCHL, was there ever any doubt?

  1. Anonymous

    So, pretty much every one of the “negative nay-sayers” predictions are coming true.

    Debt constraining opportunity.
    Executives at DCHL companies out of control. Let’s have another look at Citibus Newton then.
    Budget blowouts, exclusions, ownership all panning out.

    Grady deserves a lot of credit for the clean-up he has done at Delta, but it took many years for [matters] to be completely uncovered.

    {Moderated. -Eds}

  2. UglyBob

    Well hang on here, the article doesn’t state the holding companies are in trouble; all it states is the view of Cr Staynes, which presumably is the same now as when he voted against proceeding with the project in 2009. Effects are still ‘may’, not actual, and the mechanisms for servicing the debt remain the same as originally proposed and forecast. Chickens might come home to roost but they haven’t yet.

  3. Russell Garbutt

    There is no doubt whatsoever that the DCHL group of companies has been knowingly placed into the position where they are required to pay the DCC a level of dividend that they cannot provide through trading. The message is given to them every year when the DCC supplies DCHL with the required dividend IRRESPECTIVE of their ability to pay. If they don’t have the money they have to borrow it. What company operating in the real world operates in this fashion?

    The likes of Noone, Chin, Acklin, Brown, Guest, Walls, Collins and especially Hudson – who has a clear duty to ensure that the group of companies that he is Chair of operate in a way that enables them to return a profit to subsidise rates – have failed in their governance responsibility by requiring DCHL to borrow for no other reason than to pay for the new rugby stadium. Such actions are neither conservative, nor responsible.

    I don’t believe that Delta have provided the ORFU and Otago Rugby with a wide range of services and goods at commercial rates and the reason for my disbelief is that despite repeated attempts to find out just what “sponsorship and financial support” they have provided, the amounts and range of services remain hidden from all view. Transparency is not the way that anyone connected to the DCC operates when rugby is concerned.

    Lastly, the executive responsible for signing up for the lounge membership may have been labelled “over-zealous”, but there are others that have a different wording to describe the action of seemingly paying out $100,000 of effectively ratepayer money without authorisation or approval.

    I sense some change in the air, but until this cone of silence that surrounds anything to do with the CST and any DCC group that supplies the local rugby community with facilities, resources, services and cash is lifted, then we should all be very wary about believing too much that comes out of the mouths of those that made all the decisions to go ahead with the stadium in the first place. Belief comes from trust and trust has to be earned, not imposed.

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