DVML gets into bed with ORFU

UPDATED POST – What happens to The Highlanders?

A commercial relationship between DVML and ORFU has been in the wind for some time. See today’s comments at MAD Classics #26 – You’re a crook or a businessman?

### ODT Online Fri, 2 Dec 2011
ORFU to be run by DVML
By David Loughrey
The Otago Rugby Football Union will drop from a high of 36 staff in 2006 to a small core group next year, and move from Carisbrook to an office at Forsyth Barr Stadium, as its non-rugby responsibilities go to Dunedin Venues Management Ltd. In what ORFU chairman Wayne Graham said was a “massive change” for the union, ticketing, sponsorship and commercial activities would be all taken over by the Dunedin City Council-owned DVML.

• Mr Graham said yesterday from Auckland, where he was attending a New Zealand Rugby Union meeting, commercial responsibilities and marketing would go to DVML.

• [DVML chief executive David David Davies said] there had been discussions with the Highlanders, which were ongoing.

Read more

### ODT Online Fri, 2 Dec 2011
NZRU look to sell Super Rugby licences
By Michael Brown
The NZRU are about to enter into a brave new world with plans to sell off the licences to four of the five Super Rugby franchises. The national body today issued a public invitation for expressions of interest to manage and operate the Blues, Chiefs, Hurricanes and Crusaders.

“For now we have agreed to allow the Highlanders to stand aside from the EOI process as they are already some way down the track with exploring other alternatives which are commercially sensitive,” NZRU chief executive Steve Tew said today.

Read more

Twitter account @HighlandersTeam

Posted by Elizabeth Kerr

37 Comments

Filed under DCC, DVML, Economics, People, Politics, Project management, Site, Sport, Stadiums

37 responses to “DVML gets into bed with ORFU

  1. Elizabeth

    ### ODT Online Sat, 3 Dec 2011
    Highlanders seek local solution
    By Hayden Meikle
    A process to find private investors to prop up the New Zealand Super rugby franchises will not include the Highlanders, who have quietly spent the past three months looking for their own model of financial prosperity. […] Highlanders chief executive Roger Clark would not expand on any possible deal with DVML. “Obviously, the stadium and the Dunedin City Council are important partners for us. Every franchise needs a stadium and a supportive local body. “Other than that, I’m not willing to say anything.”
    Read more

  2. Phil

    Every franchise needs a supportive local body ? Since when, Rog ?

  3. Hype O'Thermia

    There’s supportive and supportive. If I’m supportive to a friend in trouble I might lend him some money – that’s “l-e-n-d” – mow his lawns till his sprained ankle mends, invite him for a few feeds, spend time listening to him and being, what’s that word, supportive. Human decency. If he looks like he’s never going to regain the will to help himself even when he regains good health I’m gone, I don’t need a parasite. Why some particular failing businesses “need” ratepayers’ representatives to agree to prop them up indefinitely I cannot understand. Parasitism should be firmly discouraged.

  4. Elizabeth

    Through all this – ORFU, Highlanders – I keep remembering the rift that exists between amateur rugby and professional rugby on the local scene.
    I don’t for a minute believe the amateur code is responsible for professional rugby’s excess; in the same way I don’t believe ratepayers are responsible for the stadium and stadium-related excesses (which includes what went down with the sale of Carisbrook to DCC, the Logan Park redevelopment project, pushing a new swimming facility nearby the stadium, etc) just because Dunedin City councillors have constructively mismanaged the council books to ‘support’ professional rugby.

  5. Phil

    OK, there’s more coming out on this. The Highlanders have been the poor performers for years, the NZRFU says this. The NZRFU have also said that the previous bail out was the last and that they would be considering moving the franchise to another area with a greater chance of returning a profit. Presumably into the Auckland region somewhere. Suddenly, out of nowhere, the near bankrupt Highlanders managed to buy up brand new players and coaches last year. Now, they had no money, and the NZRFU didn’t give them any more money. So where did this sudden wealth come from ? One guess.

    All of a sudden the Highlanders are off the hook. But the NZRFU still wants a second franchise in Auckland. So they start looking at the next lowest performing franchise, the Hurricanes. And start making noises about relocating them.

    So here’s what I think. The NZRFU went to Dunedin City and said “you buy them or we move them”. What’s the bet that the phone line between the Wellington City mayoral office and the headquarters of the NZRFU are running red hot at the moment. Both Dunedin and Wellington should have had the bottle to stand their ground and call NZRFU’s bluff.

    • Elizabeth

      Is this why Mayor Cull has been resoundingly silent for two days at least? I think even predecessor Chin would’ve wanted to say something glib in the circumstances. [Occupy Dunedin was a safe hedge, for a while, Dave – speak to that sideshow while the big stuff is processing darkly at Council.]

  6. Russell Garbutt

    No, I don’t believe that this is the main root of the problem.

    At the heart of things is that central to the contracts for “product” is a clause that spells out that the contracts, and any on-going payments, are dependent on professional rugby being provided at the stadium. In short, if rugby goes then all “private funding” stops – hence why the ratepayers have, through a combination of ineptitude or connivance of the last Council and its associated entities such as Farry’s private CST, entered into a mutual suicide pact.

    The solution?

    Cut the losses, act with strength, require professional rugby to meet all costs associated incurred running their business or be provided with no further ratepayer subsidies and direct hand-outs. It may be that is the wisest and best thing to do by far is to close the doors on the stadium to staunch the financial bleeding – but first we need independent, forensic analysis that we can trust.

    This City faces unprecedented financial failure through a series of decisions of the last Council – and I for one believe that they, and their agents, should not be immune from prosecution and financial action.

    • Elizabeth

      So probably the answer lies somewhere in a combination of Russell’s and Phil’s comments – clearly, new money has bubbled up for the Highlanders, might not all be stemming from Council, could be some from the local lads kicking in, privately – hey, commercial sensitivity.

  7. Hype O'Thermia

    Is anyone engaging in a robust series of requests to the new government and opposition and undecided MPs to get such an “independent, forensic analysis that we can trust”?
    ACT might relish a reminder of how useless R Hide was and take on energetically the job of showing how much better J Banks is……………… Anyone representing another profligate region might also be inspired to bundle the whole issue of oversight of out of control councils.

    • Elizabeth

      ### ODT Online Sat, 3 Dec 2011
      Opinion: Your say
      Highlanders – the devil in the detail
      By Rob Hamlin
      I think that we can take it as a given that this particular rugby piglet is about to attach itself to the DVML ‘tit’ alongside its ORFU sister […] the devil of this arrangement depends entirely upon the ongoing dietary requirements of the DVML ‘sow’ and how these are going to be satisfied by the ratepayer.

      Mr Cull, the time has come to you do something about this. Kindly convene your Council and put before them a motion to instruct DVML to desist from negotiating/finalising these arrangements with pro rugby. If not, then by further floor motions take the necessary steps to compel them to do so. This might involve swiftly convened extraordinary meetings of both DCHL and DVML, and the forcible removal of directors who find it impossible to do as they are told by their sole shareholder.

      Read more

  8. Anonymous

    Comments elsewhere tend to indicate that it is indeed DCC-owned enterprise that is “mulling” the purchase. By definition, Council will be the last to know, as they are “hands off” operational matters.

    Should DVML make the acquisition, then DCC should respond as outlined above. If DCC does not, then action should be taken by ratepayers to seek action from the Local Government Minister to immediately step in, dissolve Council, appoint a Commissioner and put genuine oversight in place in DVML.

  9. Anonymous

    It’s difficult to ignore the irony that the board structure of DVL and DVML mirrors the structure that was in place at DCHL. Board of parent identical to board of subsidiary.

    • Elizabeth

      Reminder, DVL and DVML have the following board(s)…

      Peter John BROWN – Dunedin
      John William HANSEN (chairman) – Rangiora
      Peter James HUTCHISON – Dunedin
      Jennifer Helen ROLFE – Auckland
      Peter Geoffrey STUBBS – Auckland

      DVL 2512390 incorporated 24.6.10
      DVML 2298338 incorporated 31.8.09

  10. Russell Garbutt

    Astute readers of the Oddity will see that my letter, submitted to them last Friday was “too long”. So for those that can read “long” letters here is what I submitted.

    Dear Sir

    Your front-page headline regarding DVML taking over many of the functions of the ORFU and the later-revealed news that the NZRU is not including the Highlander’s franchise into their current invitation for expressions of interest as the franchise is already in secret negotiations of its own hinted at in the ODT article is the final insult to the ratepayers of this City.

    Just how is it that David Davies and DVML can get to the stage of a done deal when the City Councillors knew nothing of it?

    Let us examine yet again, the history of just how professional rugby has managed to get a direct route into the coffers of this City. It was the financially strapped ORFU that set up the original Carisbrook Working Party with the parties it identified as being financial donors to get a new stadium. The resultant private Carisbrook Stadium Trust, filled with professional rugby supporters is given the task by the professional rugby coterie on the then Council(s) to make it happen. The ratepayer funds for construction of the stadium were committed under the public belief that private funding would be used to construct the stadium which turned out to be nothing than partial advance operational funding. When this was finally revealed it was too late to stop and so further ratepayer funds were extracted. In the meantime the ORFU saddled with huge debt somehow manages to get the then Council to buy Carisbrook from them for the fortunate sum to clear both the bank debt and the $2m of debt incurred when the DCC acted as the ORFU private banker. Concurrently, Council owned companies continued to pour huge amount of cash through sponsorship, the supply of services and staff, and the provision of buildings for professional rugby academies and training facilities.

    Professional rugby failed to put any money into the building of the new stadium, and despite getting sweetheart deals, they now want DVML to conduct those parts of their own private business that currently cost them. Ratepayers, read dip into your pockets yet again.

    It is public knowledge that professional rugby is a loss-making business of huge dimensions with Otago/Southland being leaders in losing money. Can we all now be fully informed through the ODT, just which DVML, DVL, or DCHL Directors knew of this latest raid on public money, who the current Directors are, and why they think the ratepayers of this City, represented by the Councillors who apparently knew nothing of this at all, should financially meet the ongoing debts of a private business?

    If they are determined that the City and professional rugby has entered into a mutual suicide pact, then I, and I’m sure many others, would prefer this pact to be ripped up and professional rugby told at last to leave Dunedin by the next freight train.

    Russell Garbutt

    • Elizabeth

      Community service, do we care.

      ### ODT Online Tue, 6 Dec 2011
      Highlanders clean up Dunedin beaches
      By Ellie Constantine
      Organised with Keep Dunedin Beautiful (KDB), the [Highlanders] spent the afternoon cleaning Tomahawk, St Kilda, Blackhead and Brighton beaches to prepare them for locals and visitors to enjoy over the summer holidays.
      Read more

    • Elizabeth

      Russell, having purchased my paper at lunch hour, TOO true I noticed the ODT editor’s curt “Too long.” — I’m surprised TOO, that he didn’t offer you space on the Opinion page for your (TOO?) sensibly inquiring letter. Hopefully, the ODT’s recent sponsorship of a stand at the Stadium (see TOO, corporate box use by the company’s owners, and The Big Night In) hasn’t put the brakes TOO quickly on TOO-hard questions going to publication at the Daily. However, ODT’s commercial sponsorship does suggest they’re supporters of all things rugby – that this TOO, of necessity, would extend to support of DCC, DCHL, CST, DVML, DVL, ORFU, The Highlanders, Delta, Academy of Sport, and associated entities. So Russell, pipe down – ODT’s committed to saving you from yourself, sparing you from further anguish and despondency, TOO… in relation to deals diced somewhere close by but (not completely) out of sight.

      No, I can’t think media censorship is being exercised by ruse of the word limit, TOO unlikely.

  11. Russell Garbutt

    I did note that one of the days of “community service” was shifting the Academy of Sport (read rugby academy) into the stadium. I don’t think that this really counts do you?

  12. Peter

    A half day’s ‘work’ cleaning up the beaches – no doubt in between a few beers – is the most hilarious bit of tokenism, thanking us, I guess, for bailing them out by footing their bills. A pathetic PR exercise that has all the hallmarks of David Davies and his crew.

  13. Peter

    When is enough actually… enough? Not only do they want a new publicly funded stadium costing eye-watering millions, but now they want more public money to appear to be ‘financially successful’. They can’t run their own affairs because, let’s face it, these guys are thick and truly believe the world owes them a living. Though I do admit they have good feral instincts for survival.
    The ratepayers are now well and truly pack raped by these rugby boys. This latest scamming has gone well beyond the line of decency.

  14. Russell Garbutt

    Yes Elizabeth, the days of the Oddity in being an enquiring and impartial observer and reporter of the community’s activities are long gone. Long gone are the days of crusades as a result of long investigations – much more expedient to leap into bed with a few like-minded mates.

    Look at the stuff the Oddity could be doing apart from the whole area of profligate and misdirected Council spending. How about the stoush over the location of the Central Scanner? Should it be Clyde, or Queenstown? In other words in the domain of a certain number of key financial players or in the middle of the geographic location where it is required? What are the issues? Who are the key players?

    There are dozens of issues that the Oddity could get into, but based on what can only be described as a Scrooge approach to their celebration of their 150th when it came to the stadium, I hold no hopes for a sudden opening of the eyes of what a small City newspaper could/should be doing. I wonder if any of the owners have read John Grisham’s “The Last Juror”, which, though entirely fictional, does describe what a paper can do. Maybe the Oddity has not yet quite realised that its relevance is fast diminishing and unless and until it wakes up to the changes which are happening in how people get the news, it’s time as a going concern will be limited.

    • Elizabeth

      Russell, this week was the second time ODT spammed subscribers (including me) to ODT Online by sending emails promoting a new online newsletter and other offers pending. The first time colleagues complained, and explained the legal position to ODT. This week, colleagues formally complained to the Department of Internal Affairs. As we have all been saying, it’s one thing for the ODT marketing team to make the ‘error’, it’s another thing for their web developers to disregard the law twice (or more).

  15. Russell Garbutt

    I too received multiple copies of this unrequested email and was not pleased to do so.

  16. Anonymous

    They sent an opt-in letter the second time.

  17. Anon

    So next Monday the visiting Wellington Phoenix team will be having an open training session at Forsyth Barr Stadium. A gold coin will be required for entry according to their facebook, and in response to a punter’s question this will not be going to any charity but instead to “cover operational costs of opening the Stadium to the public for the training :)”.

    Open training sessions were free during the RWC and the Phoenix session was free last time around.

    DVML must be strapped for cash if they are really going to collect $1 or $2 from little kids going along to see some professional footballers kick a ball around in a training session. Oh and sign autographs too.

  18. Mike

    Of course they’re strapped for cash – collecting what they can is a good thing

    • Elizabeth

      It’s called sucking up petty cash from the Dunedin ratepayers’ and renters’ children. Dunedin public pays again. Limited (leveraged) spending pool.

      [ask a corporate fundraiser: ‘sausage sizzles’ don’t raise high finance]

      [better to donate food, toys and cash to local foodbanks – help the less fortunate in our community!]

  19. Peter

    I agree, Mike. No problem for me getting money off the punters if it helps to run the damn thing. Those who love the place – pay. Someone has to.

  20. Calvin Oaten

    Some of you may have read the Advert in the ODT Dec 2 re pre selling tickets for next season’s rugby events.
    As a matter of interest, I have initiated through the ‘Citizens Advice Bureau’ (CAB) a complaint about the advertising of tickets for next season’s Super 15 and the ITM Cup. A half page in the ODT (where else?) Dec 2. Example: “Highlanders & Otago Premium” from $225.00 or $4.33 per week. Down below in the fine print (hardly readable) it adds $10 charge plus $1.40 transaction fee per payment. This makes the $4.33 per week really $5.92. Result: the $225.00 total is actually $307.84, an increase of $82.84. CAB have advised that they have written to the Commerce Commission strongly complaining about the false misleading promotion. Incidentally, if one extrapolates across the other options the same format applies.

  21. Russell Garbutt

    Calvin, I would actually like to see the fine print reduced even further and a clause inserted that required any professional rugby supporter purchasing a ticket liable for a special tax or City payment that covered any annual losses of the rugby stadium including operational, construction, debt, debt servicing, depreciation, loss of opportunities etc etc and that the purchase of such a ticket commited the ORFU or the Highlanders to an equal sum of special tax or City payment. While this might make the tickets several thousand dollars this would reflect what is needed to run the white elephant for pro rugby.

  22. Peter

    The ODT should have picked up on this, you’d think. Maybe not.
    After all the paper must have some pride left for its reputation, surely, but maybe anything that helps rugby’s financial coffers – even if the advertising is dodgy – is okay and has the ODT’s blessing.

  23. Anon

    By sponsoring the ODT stand at the Stadium the ODT have now surrendered any shred of objectivity they may have had remaining when it comes to reporting any criticism levelled at the Stadium.

  24. Phil

    Exactly right. Any future statement or comment made by the ODT with regard to the stadium or DVML will have to carry a clear Conflict of Interest banner.

  25. Peter

    The ODT is doing a special 12 page lift out on The Stadium Story for Monday’s ODT. It will be interesting to see how they handle it. I suspect (but hope I’m wrong) it will be a rewrite of history with a lot of ra ra ra thrown in.
    Hopefully, the ODT realises its credibility, and that of the journalists who write it up, is on the line here. I will also be taking note of the selection and size of photos – both pro and anti stadium. Will there be balance? That is the big question.

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