Major debate and valid questions remain about how the stadium was funded and built and whether the council made the right decision to throw in so much public money (originally $91m, but later $148m) as explained in the sidebars to this story.
### stuff.co.nz Last updated 05:00 03/06/2012
Dunedin’s House of Blame
By Steve Kilgallon – Sunday Star Times
The prospect of yet more glittering new stadiums being constructed by ambitious city fathers – as being debated right now in Christchurch and Auckland – is met with scorn by some in Dunedin, where the saga of the Forsyth Barr Stadium has left a city divided and its ratepayers facing vast debts.
“five years of internecine warfare in Dunedin, three High Court actions, claims of conflicts of interest, a divided council, a pile of debt and an even bigger pile of documents”
A covered stadium was a grand concept for a city of just 125,000. At various times, it was imagined that it might host international soccer, rugby league and even swimming; that penguins would frolic in a (converted) adjoining quarry, and not just that the biggest names in rock music would visit, but, perhaps, the Dalai Lama and British royalty. With significant “private finance” support, the cost to the taxpayer would be capped at a mere $91 million and the stadium delivered to the dollar at a total cost of just $188m. Now it’s been built, there remains debate on quite how much it actually cost. Its creator says it came on time, on budget. Some critics argue double that. Dunedin council engaged consultants PricewaterhouseCoopers to give them a figure, and explain any blowout.
UPDATE: Steve Kilgallon’s story reposted at Stuff Sport
Stadium plans met with scorn [05:00 03/06/2012]
In full here, the sidebar appearing in Sunday Star Times print edition:
ON THE MONEY
Council wasn’t meant to bear all the weight of the stadium: a much spruiked “private sector finance” contribution was kicking in $45m.
The latest PricewaterhouseCoopers report says just $700,000 of a promised $45m had been found by last November (two months after opening day), and reported how various updates to the council scaled back the timing of that funding from 100 per cent received before completion to just three per cent. Peter Chin says when he left office in 2010, it was “on track”; however his successor, Dave Cull, dismisses the private sector finance (PSF) as “risky”.
It’s argued, perhaps validly, the PSF was really just advance operating revenue: it wasn’t philanthropic donations but long-term seat sales, sponsorships and lounges. If used to fund the build cost, it begs the question: what would offset operating costs once it was open?
In an email to Bev Butler in March 2010, Malcolm Farry said “donations, sponsorships, sales of product and funds raised all have a donations component included”.
Now he’s exasperated by the PSF question, telling the Star-Times it doesn’t matter what you call it, the point is the money was raised. As for PwC saying it wasn’t, “just because they are PwC doesn’t make them immune from inaccuracies”. After all, he argues, if the figure was only $700,000, how would you explain a substantial 10-year naming rights sponsorship with Forsyth Barr?
Farry also answers other major criticisms. He says the stadium was on time, on budget, “a remarkable achievement because stadiums aren’t known for meeting their [planned price] but this one has”; former deputy mayor Syd Brown says Farry deserves a “commendation” for that.
But others say it only met the $198m target price by excluding costs: the catering fit-out eventually cost $6.1m, some of which was demolishing newly built walls to accommodate kitchens. PwC said this over-run should have been referred back to council. Another $7m of “variations” included wi-fi, phone system, replay screens, toilets and temporary seats. Farry says the stadium came with a “particularly high standard kitchen, benchmarked against other stadia” but the tenants wanted something flasher, so had to pay for it; items like phones were always the tenant’s responsibility.
The stadium trust’s own budget of $3.7m blew out to $5.4m, a 46 per cent overspend, including $580,000 on advice from Auckland PR firm the Marketing Bureau.
Then there’s the budget-busting land purchases at Awatea St, which dissidents claim were inflated. Farry’s cousin John – also chairman of stadium donors Otago Community Trust – was a one-third shareholder in Maxton Holdings, which owned 8 Awatea St; bought for $220,000 in 2001 and sold to the trust for $1.6m in June 2008, with a clause – signed by Malcolm Farry – guaranteeing other landowners on the site wouldn’t get a better deal. In November 2008, John Farry told D-Scene: “That property is a piss in the bucket as far as I am concerned. It makes absolutely no difference to my life at all”, a quote he later asked not be used. This part of the project, says Malcolm Farry, was always going to be complex and time-consuming and ultimately, land purchases are a negotiation.
Critics claim the stadium is smaller than expected: of its 30,500 capacity, only 17,350 seats are permanent, with temporary stands either end. That might breach the old NZRU minimum standard for All Black tests of 30,000 seats, but fortunately, the union told the Star-Times they’re now more flexible. Farry says, again, his opponents are guilty of wilful misinterpretation: the seats aren’t temporary, but “relocatable” to enable the venue to host rock concerts.
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Posted by Elizabeth Kerr