Submission to DCC draft long term plan (2)

By Bev Butler

The Long Term Plan [2012/2022] as a document is only beneficial to the community when it fully incorporates the probable financial outcomes for the city. This Long Term Plan has not taken into account the financial future of the stadium. (The DVML six-monthly report has been delayed until after submissions close). The DVML report will reveal that the stadium is running at a multimillion dollar loss and it is now time to do a cost-benefit analysis of whether it is financially viable for the stadium to remain open or not. The results of a cost-benefit analysis of the stadium would then put the city in a clearer position to then make decisions for the future. The city in its present overwhelming debt situation can ill-afford to continue to sustain the stadium multimillion dollar losses. The Council has been capitalising interest for the last few years to the tune of over $40m. This situation if allowed to continue will eventually result in bankruptcy.

The main anchor tenant of the stadium (the ORFU) is technically insolvent and has already come to Council requesting a bailout. The Dunedin ratepayers cannot afford to keep on bailing out the ORFU. It will not be long before the ORFU again request another bailout. This has been the pattern over many years. I have no confidence that the ORFU bailout conditions will be met just as the stadium conditions were not met (see attached spreadsheet).

The council has to change its mindset that ‘what is good for Otago rugby is good for Dunedin/ Otago.’ Clearly, on a financial basis, this has not been true for many years. It is not the DCC’s role to continually ‘wet nurse’ the rugby interests in this town by caving in to their repeated, self=destructive mode of operating. Namely, their calling on public funds when they get into financial trouble.

It has become clearer as Official Information has been released that the process that led to the building of the stadium was corrupt. I request that the Council instigate a full independent inquiry into the whole stadium project so that those responsible for misleading the community are held to account. Until this happens the stadium will continue to divide the community.

Natural justice demands accountability. Those key people who have brought this stadium scandal to this point must be held to account. Avoiding doing this only intensifies the division, the hurt, in the community because natural justice has not been served. I ask the mayor and council to show courage and do what is right for the interests of the whole community and not just serve the interests of the selfish few.

Addition for hearings

It is quite clear to any uninvolved observer that enough serious questions remain unanswered about the behaviour and actions of the ORFU for the DCC to get into any agreement, contract or understanding with them. At one end of the scale there are the matters regarding who got paid out for the black tie dinner affair and yesterday I have been advised that the Ombudsman’s Office is now investigating DVML’s part in this matter.

On the other end of the scale are the well-publicised revelations of the involvement of the ORFU in pokie funds and the ownership of bars in Auckland and the propriety of their actions in these matters. The DCC does not need to be in any sort of partnership or agreement with the ORFU at all. They can hire the stadium on the same basis as anyone else. In short, their actions over many years have underlined the accuracy of the Mayor’s comments. I urge this Council not to get into bed with this organisation which has proven itself over many years to be nothing other than a constant drain on the city’s slim resources.

Comments on the DVML half yearly report
● DVML’s 6 month loss really is $2.0m not $1.9m. There’s some optimistic rounding (of $1,963,662) but I guess it’s not important.
● The combined DVML/DVL half yearly loss is $7.2m. This is the more realistic figure for the whole stadium operation and is in line with the stadium opponents’ figures of $15m to $20m annual loss predicted back in 2007.
● The full yearly result will actually be worse partly because DVL have only had the debt on their books for 5 months not 6 months.

Recommendations
1. A full independent inquiry of the whole stadium scandal.
2. The council instigates a cost/benefit analysis of the present stadium situation.
3. The DCC do due diligence on the ORFU before finalising the bailout. (DVML did not do any due diligence on the ORFU before supporting the bailout.)
4. I call on all pro-stadium councillors to resign immediately.

[ends]

Posted by Elizabeth Kerr

2 Comments

Filed under Business, Construction, DCC, DVL, DVML, Economics, Events, ORFU, People, Politics, Project management, Property, Site, Sport, Stadiums

2 responses to “Submission to DCC draft long term plan (2)

  1. Anonymous

    ‘4. I call on all pro-stadium councillors to resign immediately.’

    They’re dug in pretty deep. Too much to lose to go quietly? More likely require a public push or a bloody great kick up the arse to shift the remaining ones, especially the more devious of the group. Nothing short of a criminal investigation or a massive public outcry probably.

    MikeStk, you’ve commented on a similar topic before, what might happen if one or more of the Stadium Councillors actually did the right thing and resigned in the next few months?

    I know it’s unlikely as they would be inclined to massage someone similar-minded into their cushy seats at the next election but I’m sure others must be interested in knowing too.

  2. ormk

    I don’t see how the plan can gloss over the financial position of the stadium. Even more so following the established very public failure and incompetence of the ORFU. To continue climbing into bed with this organisation is clearly masochistic. Even with the most optimistic passion for the ORFU it would be clearly negligent not to plan for the eventuality of their continued failure. They are a failing organisation. I think that needs to be hit home publicly in the meeting – in future councillors refusing to plan for these contingencies will be left in an invidious position. Some of them are in a very big hole already. Much as they’d like, we don’t want their colleagues jumping in with them.

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