Monthly Archives: February 2012

ORFU insolvent for some time

### ODT Online Wed, 29 Feb 2012
Opinion: Blog
Time to tear off ORFU’s cloak of commercial invisibility
By Rob Hamlin
With any luck, the unlamented Otago Rugby Football Union Inc. will go into liquidation on Friday. As usual the Devil is in the detail, and in this particular instance the detail is in the last three letters of the name of this organisation. If it was the ORFU Ltd. that was to be liquidated, then the ORFU board might well be looking forward to Friday with some considerable trepidation.

The DCC purchased Carisbrook last year for seven million dollars on the basis of a professional valuation. Given that the ORFU’s has ‘only’ lost some $800,000 in the 2011 period, these figures would suggest that the ORFU’s debt at that the point of Carisbrook’s sale was over eight million dollars (7.0+2.3-0.8 = 8.5). Thus, when Carisbrook was sold in 2011, it is possible to estimate that the ORFU’s debt exceeded Carisbrook’s market value by over a million dollars. These figures, combined with chronic losses, would suggest that a recognisable state of insolvency existed at that date.

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NOTE: Rob Hamlin’s blog at ODT Online was removed. Therefore, the ODT link is no longer active. -Eds.

Posted by Elizabeth Kerr

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Filed under DVML, Economics, Media, People, Politics, Project management, Property, Sport, Stadiums

Private sector funding for stadium always in doubt

What does CST’s Malcolm Farry say now, you have to ask.

### ODT Online Tue, 28 Feb 2012
Doubts over private sector funding for stadium
By David Loughrey
The future of “private sector funding” for the Forsyth Barr Stadium may be thrown into question by the shock announcement last night the Otago Rugby Football Union (ORFU) could fold by the end of the week. Dunedin Venues Management Ltd (DVML), the Dunedin City Council-owned company running the stadium, has sold season tickets on the expectation an Otago team would play at the stadium in the ITM Cup.
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### ODT Online Tue, 28 Feb 2012
DCC in queue of creditors
By Chris Morris
The Dunedin City Council seems set to join a queue of worried creditors after confirming it is owed more than $400,000 in unpaid rent by the Otago Rugby Football Union. However, any prospect of a last-minute bail-out by the council appears to have been ruled out, with council chief executive Paul Orders and Mayor Dave Cull last night in unison about there being no city council plans to save the union.

Mr Orders said the Otago union had a “proud history” and liquidation would “clearly” have implications for the Forsyth Barr Stadium, although the extent of these was as yet unclear.

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Posted by Elizabeth Kerr

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Filed under Construction, CST, DCC, DVL, DVML, Economics, Hot air, People, Politics, Project management, Property, Site, Sport, Stadiums

Another expensive nut cracks, ORFU liquidated?

### stuff.co.nz Last updated 20:18 27/02/2012
Otago rugby union heading into liquidation
By Mike Houlahan – Fairfax NZ News
With debts of $2.35 million, and a loss from the last financial year of $862,000, the decision was made at a press conference in Dunedin tonight, with NZRU CEO Steve Tew and chairman Mike Eagle in attendance. The 126-year-old union, which has not held the Ranfurly Shield since 1957 or won the National Provincial Championship since 1998, will cease trading by Friday. The New Zealand Rugby Union (NZRU) is taking immediate steps to support community rugby across the Otago region. “We are stepping in to support community rugby and all the amateur players, volunteers, administrators, and others who have a stake in the game,” said NZRU chief executive Steve Tew. Otago has a long and proud rugby history and the union has played a vital role in the rugby community for 131 years so this is a sad day.
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What does this situation mean for Forsyth Barr Stadium? (via Stuff)
The Highlanders still intend to play at the stadium and today’s events do not impact on that. The Highlanders will host their first home game for the season this weekend. Our desire is for a team from Otago to participate in the ITM Cup, but it is too early to discuss what will happen in that regard. Any issues relating to the financial impact on the stadium should a representative team from Otago not play in the ITM Cup are for the stadium owners to comment on.

http://www.odt.co.nz/sport/rugby/199277/orfu-be-put-liquidation

Related Posts and Comments:
17.2.12 Does the insolvent ORFU deserve any more community support?
11.2.12 Where’s this going, ODT?
14.12.11 Davies “in the middle of a conversation” – how to fudge DVML…
2.12.11 DVML gets into bed with ORFU
13.10.11 MAD Classics #26 – You’re a crook or a businessman?

Posted by Elizabeth Kerr

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DCC Statement of Public Debt Summary as at 31 December 2011

Comment received.

Calvin Oaten
Submitted on 2012/02/26 at 12:43 pm

I looked up the DCC site, and just happened to feel like looking at the Finance, Strategy and Development 31 December 2011 report. Of particular interest is the Public Debt Summary Statement.

Stadium balance $148.404m. Interest paid $4.222m. Now if DVL is to assume $110m of this debt, it is official, the balance of $38.40m stays on the DCC’s books. A dollar to a doughnut this is the private funding underwrite.

The total debt of the DCC is $344.819m. Not sure what DCHL’s debt will be at 31 December but at 30 June last, it was $4.316m short term and $534.220m long, for a total of $538.54m. All up, it would seem that at New Year’s Eve we citizens are shouldering a total of $883.336m. Feel good? Split that among 54,000 ratepayers and this amounts to $16,358 per person! Still feel good? We ought to, as this earns us the title of champion most highly rated citizens in New Zealand, by a country mile. Where is the medal?

Investment and miscellaneous property debt (excluding property operational but including Carisbrook) carries debt of $33.869m. Here is a portfolio the DCC could do without. Investments like this are for organisations having a debt/equity ratio much much healthier than the DCC’s. Sold up, this portfolio could remove that debt and release the equity for further debt reduction. I recently did an exercise on this aspect and emailed it to Dave Cull copied to Paul Orders. Response? Zilch!

Interesting also, is that of the total debt of $344.819m, that pertaining to all Transport Network, Public Health, City Development, Museums (including OSM, and Chinese Garden), Sport Recreation & Leisure (excluding all things stadium), and Corporate Support add up to $140.881m. So, it can readily be seen just what a tremendous burden the stadium is upon the city.

Report – FSD – 09/02/2012 (PDF, 660.0 KB)
Financial Result – 6 Months to 31 December 2011

See Attachment 7 – Statement of Public Debt as at 31 December 2011 Summary Sheet

Posted by Elizabeth Kerr

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Bringing DCC councillors, staff, related entities and individuals to account, let’s get honest

The Dunedin City Council is dragging its heels, for reasons that should be made public immediately, on declaring the wayward spend that has brought the new stadium about, including the realignment of SH88 — all of which has taken the project beyond the councillors’ role required by the Local Government Act, to act prudently and conservatively with ratepayers’ money.

The councillors’ fiduciary responsibility to this community has been abandoned by thorough incompetence and deception that borders on the criminally fraudulent. This will require direct action by the Minister of Local Government, Nick Smith. There is no getting around this.

The independent review of stadium costs by PricewaterhouseCoopers is of necessity limited by its price tag of $55,000 and the instructions of the commissioning client, Dunedin City Council. Meanwhile, the ‘independent’ Otago Daily Times is prepared to sit back as a moderate, to cover tail.

In terms of “who”, he said if something “untoward” was found, “there will be accountability issues”. -Cull

### ODY Online Mon, 27 Feb 2012
Extra cost on stadium not massive blowout: Cull
By David Loughrey
Dunedin may not being facing a huge blowout in the cost of the Forsyth Barr Stadium, but it is possible people or organisations may be “brought to account” following an investigation. It emerged on Friday questions remained about the final cost of the stadium – six months after the facility was built.
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Posted by Elizabeth Kerr

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‘The final cost of the stadium is … unknown.’

UPDATED

### ODT Online Fri, 24 Feb 2012
Multimillion dollar uncertainty over final stadium cost
By David Loughrey
Six months after the project finished, the Dunedin City Council today admitted it still had questions about the figure, and would fund a $55,000 independent review of the issue. Mayor Dave Cull said the amount in question was ”in the millions” but ”not in the tens of millions”. He would not speculate on what the final cost may be. A team from the Auckland office of PricewaterhouseCoopers would arrive in the city next week to undertake the review, which the DCC says will be funded “from existing DCC budgets”.
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Carisbrook Stadium Trust chair Malcolm Farry declared it had been completed on time and within budget. Mr Cull says that statement is now in doubt.

### radionz.co.nz Fri, 24 Feb 2012 Updated at 12:27 pm today
Irregularities found in stadium accounts
Dunedin City Council has appointed accountants to review the costs of the city’s new stadium because of irregularities in the project’s final accounts. Mayor Dave Cull and the council’s chief executive made the announcement on Friday morning. They say the council has identified money spent that it cannot account for so it has appointed PricewaterhouseCoopers to independently review the whole project. Mr Cull said he did not know how much the overrun was, but indicated it was likely to be millions of dollars.
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### stuff.co.nz Last updated 12:12 24/02/2012
Probe into Dunedin stadium costs
By Wilma McCorkindale
The Dunedin City Council (DCC) had called in independent PricewaterhouseCoopers (PWC) investigators after a report tabled Monday from new council chief executive Paul Orders on the likely final cost of the stadium, Cull said. The mayor was refusing to elaborate on what aspect of Orders’ report has initiated the Council action, saying all involved with the project are under scrutiny.
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Dunedin City Council media release

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### ODT Online Sat, 25 Feb 2012
DCC in stadium cost bid
By David Loughrey

A “whole gamut” of parties would be interviewed. -Paul Orders

A team of independent reviewers from PricewaterhouseCoopers will arrive in Dunedin next week seeking answers to multimillion-dollar questions concerning the final cost of the Forsyth Barr Stadium. Dunedin Mayor Dave Cull yesterday announced a $55,000 review of the stadium’s final cost, amid concerns about “questions that remain unanswered”, six months after the facility was built. The review team would arrive in Dunedin from Auckland on Wednesday, and spend three weeks studying documents and interviewing “relevant parties”, including the project delivery team, the University of Otago, Hawkins Construction, Dunedin Venues Ltd and Dunedin Venues Management Ltd, quantity surveyors and others.
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### ODT Online Sat, 25 Feb 2012
Farry defends costs; Butler hails review
By Chris Morris

“We are in no doubt whatsoever that the [trust’s] agreed budget has been complied with, and there is no question about that.” -Farry

Carisbrook Stadium Trust chairman Malcolm Farry – the man who promised the Forsyth Barr Stadium would be built “on time and on budget” – insists he has delivered. That was despite Dunedin Mayor Dave Cull announcing an independent review of the stadium’s final cost yesterday, amid concerns the budget may have been blown by millions of dollars. Confirmation of the review by PricewaterhouseCoopers (PWC) was greeted as “wonderful news” by former Stop the Stadium president Bev Butler yesterday, although she hoped the examination would eventually go further.
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### ODT Online Sat, 25 Feb 2012
Editorial: Big question still to be answered
While it most surely cannot be the intention, the latest delay in revealing the final costs of building Forsyth Barr Stadium can only lead to further speculation, innuendo and adverse publicity for the venue and the Dunedin City Council. For while it is imperative to “get it right”, from the beginning the most oft-asked questions about the project were how much it was going to cost – and who would pay. Definitive answers to these questions have been slow in forthcoming and this latest postponement will only fuel responses likely to range from resignation to frustration. This, after all, is a matter pertaining to the ratepayers and their pockets. It does not help matters that, having fended off inquiries as to these very matters over some months, at a meeting supposed called finally to reveal the figures, the council yesterday yet again demurred.
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Posted by Elizabeth Kerr

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Filed under Construction, CST, DCC, DCHL, DVL, DVML, Economics, Media, ORC, Politics, Project management, Property, Site, Sport, Stadiums

Expedience: Dunedin City Council’s blunt instrument to demolish listed buildings

Resource Consent Application: LUC-2011-567
191 King Edward Street, Dunedin

Senior planner Campbell Thomson addressing the Applicant on behalf of the Dunedin City Council as at 27 January 2012, writes:

[excerpt, page 1]
“Your application for land use consent for the demolition of an existing building listed in Schedule 25.1 of the District Plan and located within a townscape precinct, at 191 King Edward Street, Dunedin, was processed on a non-notified basis in accordance with sections 95A to 95F of the Resource Management Act 1991. The application was considered by a Senior Planner under delegated authority on 27 January 2012.

“I advise that the Council has granted consent to the application with conditions. The decision and condition are shown on the attached certificate.”

Under ‘Planning Assessment’, Mr Thomson states:

[excerpt, page 3]
Affected Persons
No written consents were submitted with the application. No parties are considered to be adversely affected by this proposal for the reasons outlined below in the section headed Effects on the Environment. It is noted that the New Zealand Historic Places Trust were consulted as a Statutory Body with an interest in the proposal. Their concerns will be addressed through the requirement for an Archaeological Authority which applies to the proposal. There are no special circumstances which warrant notification of this application. While demolition of heritage or townscape buildings generally raises issues of public interest, in this case, the structural condition of the building has reached a state whereby removal of the building façade has become necessary as a matter of public safety. The key environmental issue relevant to this proposal is how to mitigate the loss of the building.”

It is unreasonable and erroneous, in the context provided by the letter writer, for the Dunedin City Council to state that “the New Zealand Historic Places Trust were consulted”.

It is unreasonable and erroneous of the Council to claim “No parties are considered to be adversely affected by this proposal”, supported by following paragraphs that do not mitigate the wrongfulness of the unjust premise.

The letter granting consent carries other instances of pomposity and disregard for due process. Where does natural justice fit?

This forum isn’t the appropriate place to debate glaring technicalities, in light of what ‘affected party’ status requires as a burden of care on the part of the Dunedin City Council. Suffice to say, the Council is telling porkies.

Furthermore, the Dunedin City Council cannot hope to reduce or limit the work, powers and functions of the autonomous Crown Entity, New Zealand Historic Places Trust, empowered under the Historic Places Act 1993, to just that of regulatory responsibilities regarding archaeological sites — for the Council’s own undemocratic purposes.

Certainly, not by Mr Thomson’s convenient slip of the Council’s red pen.

Posted by Elizabeth Kerr

### D Scene 22.2.12
Opinion: Protecting heritage (page 7)
By Owen Graham
When is a heritage building protected, and when is it not? That question is one that deserves closer attention as the effects of building neglect become more apparent in our city. In the coming months more gaps will occur in our city heritage precincts, particularly with buildings in Rattray St and King Edward St being readied for demolition. They were not damaged by earthquakes, rather by successive owners who have opted to diminish their attractiveness, economic viability and historical significance in what ultimately results in demolition by neglect. {continues} #bookmark

• Owen Graham is the New Zealand Historic Places Trust area manager (Otago/Southland)

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http://fairfaxmedia.newspaperdirect.com/

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