STADIUM LOSSES +$20M Ratepayer Subsidy each year : Not a Community Asset while Our Money flows OUT

So DDT, woops ODT, persist with their Stadium Support Policy after months of Nothing of Substance at the LOSS MAKING Stadium.

One feeble rugby test only.
Infrequent visits by grey-haired performers, jaded once-stars.

All this for +$20million each year on your Rates. The sinkhole of all Dunedin GOB stupidities, with a direct line to Mssrs MF and EE, dear friends of Queenstown.

The erstwhile owners of the local newspaper (and was it 23 delectable Rolls Royces and Bentleys later, as if Sunday night marshmellows by the roaring log fire) have the personal wealth to overlook the sheer theft by stealth and duff embellishment that is Dunedin’s LOSS MAKING stadium.

Many of us find our entertainment thrills, according to income or not…. via the tea leaves, payless YouTube, internet TV, Sky, or the treat of flying to venues elsewhere in New Zealand and overseas. Without having to insinuate ourselves into the Dog Stadium of #DUD.

Unless, you’ve a moronic Thugby itch, a weakness, a throwback in your understanding of national identity as brawl and brain injury…. and can live with just one test in a year, or more years…. to justify filching from the pockets of vulnerable citizens bullied into paying for Stadium indulgences of the rustler-wealthy and the toothless eroding upper echelons of the middle class.

Then a little Home Show for the Non-savers amongst us. Glory!

ODT 2.7.16 (page 1) tweaked by whatifdunedinODT 2.7.16 (page 1) | phoneshot by whatifdunedin

Dunedin’s 53,000 ratepayers (the hordes? far from it!) and the power users of Otago (via Aurora Energy, on notice to industry regulator, the Commerce Commission, because the lines company can’t fund sufficient renewals and upgrades to its working assets – not helped by annual subvention payments) are being Robbed Blind year in year out – to subsidise the council-owned Stadium debt servicing and operating costs.

This is a complete INJUSTICE.
All the games of tilted media Sway is the crippling joke landed upon those who dare to live South. More fool us for our obsequious, largely unquestioning gutless surrender.

In the midst of irresponsible property speculation, low-paying tourism-exploitation, and dairy industry shortfalls, no wonder it’s harder for people to meet rates, rents and basic weekly living expenses —or indeed to feed, clothe and home our very young and our school children, or to sympathetically and safely care for our elderly, and our homeless. Hell, just add the LOSS MAKING stadium as sprinkles on top.

New Zealand is now a Social-economic Monster and our Dunedin City Council is the frizzling Limb of that Heathen.

What faith a turnaround in our individual and collective fortunes at Dunedin as the +$20million pa Stadium RORT continues…. ?

The financial betrayal of the Chin and Climate-Change-Cull councils is WRIT LARGE as the hanging noose. The ANNUAL Stadium Subsidy – in raw terms – equals +$20million not available each year for Dunedin business diversity and development sufficient to create jobs as the much needed ratchet to gradually better standards of living for our most vulnerable residents.

So ODT, here’s the middle finger to your soul-destroying misfit editorial, Stadium’s true legacy (1.7.16), its deceitful posturing : an incendiary Insult to honest Dunedin people.

ODT, you socialise the parochial blindness, unquenchable greed and ultimate +$20million (annual) sins of the good old boys and flunky boosters. FO.

****

Reality checks from MikeStk at ODT Online:

The stadium’s true legacy
Submitted by MikeStk on Fri, 01/07/2016 – 10:52pm.

The stadium’s legacy continues to be a litany of broken promises and financial mismanagement. They’ve largely been papered over by raising taxes to pay for all these missteps, this can’t be put behind us because we continue to be forced to pay and pay for these mistakes and lies.

Let’s list a few:

● Mr Farry started off, back during that first council election, promising us a stadium that would be completely privately financed and the ratepayers would simply be a backstop in case of disaster. In the end we’ll have paid more than $400m, $8000 per ratepayer.
● Then we were promised the stadium “would not cost a dollar over $188m”. Turns out they quietly spent more than $250m, forgetting things like toilets, kitchens, turnstiles and scoreboards, and neglected to include the cost of debt servicing. When we’re done it will have cost more than half a billion dollars, not including the ongoing losses from running the thing.
● Rugby promised to raise $50m in capital to pay for the stadium. They failed, then they had the DCC borrow the money and ‘sold’ the best seats cheaply to their own members with the intent that that would pay down those loans (at the same time taking income from DVML). This ended up on the books as ‘rent’ that DVML was paying DVL, crying poor DVML abandoned this plan and the council hit up the ratepayers to pay for rugby’s private fundraising – we’re still waiting for rugby’s promised private fundraising.
● We’ve twice bailed the ORFU out of impending bankruptcy, largly caused by their decision to push for the building of a stadium that grossly devalued their one asset, namely Carisbrook, that secured their bank loans. In a moment of insanity the council bought Carisbrook for twice what it was worth. Having done this once rugby continued to party up big, holding black tie events for which they could not pay the bills. For some strange reason we bailed them out again. Last year the ORFU made $1m – it’s time they started to pay back some of their debts
● Rugby’s CST promised us that the stadium would make a small profit, $175k/year. Wouldn’t that be great? Instead DVML charges too little for using the stadium, losing millions every year that are paid for by the ratepayers as subsidies to create a pretend profit.

It’s been pretty much a disaster, and those responsible have yet to be held accountable. [Abridged]

****

A clarification at What if? Dunedin:

Mike
Sat, 2 July 2016 at 1:00 pm
For the record abridged from my response to this travesty was the final lines “… the various CST actors have mostly left town, the rugby crowd still don’t pay their way and wilfully neglect their promises to help pay for the stadium.”

The ODT also removed my contention that Farry’s original promise that the stadium would be privately financed “turned out to be far from the truth”. They also removed the adjective “their own stupidity” describing ORFU’s decision to push for a stadium resulting in the value of their one asset crashing to 0.

[ends]

****

ODT: Firm has 3 weeks to pay Carisbrook $3.1m debt (2.7.16)
The buyers of Carisbrook have three weeks to pay the Dunedin City Council for the former sports ground after an earlier plan to subdivide and develop the site to meet the $3.1million debt did not eventuate.

This week ODT said the mild winter had produced an increase in rodents. ODT need look no further than the infestation at its own sainted house.

Related Post and Comments:
1.12.14 Stadium Editorial Support strategy —ODT [see recent comments]

█ For more, enter the terms *stadium*, *orfu*, *rugby*, *carisbrook*, *pokies*, *dia*, *martin legge* or *bev butler* in the search box at right.

Posted by Elizabeth Kerr

Election Year. This post is offered in the public interest.

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11 Comments

Filed under Baloney, Business, Carisbrook, Climate change, Construction, Corruption, Democracy, Dunedin, DVL, DVML, Economics, Events, Finance, Highlanders, Hot air, Infrastructure, Media, Name, New Zealand, NZRU, OAG, Ombudsman, ORFU, People, Perversion, Pet projects, Politics, Project management, Property, Proposed 2GP, Public interest, Resource management, Site, South Dunedin, Sport, Stadiums, Tourism, Town planning, Transportation, Travesty, University of Otago, Urban design, What stadium

11 responses to “STADIUM LOSSES +$20M Ratepayer Subsidy each year : Not a Community Asset while Our Money flows OUT

  1. Tom

    It is not a newspaper anymore, unfortunately it has become a political rag.

  2. Calvin Oaten

    A studied insult is my interpretation of the ODT front page display by Julian Smith and Terry Davies on the Stadium. I posted the below on their online service which surprisingly published unabridged.

    Indisputable
    Submitted by Calvin Oaten on Sat, 02/07/2016 – 4:11pm.

    The only indisputable aspect is that this Stadium will go down as the single most important factor in pauperising Dunedin and its citizens. it will take years, perhaps decades for this fact to be recognised.

    “A city with its world-class stadium and the can-do people who own it.” A very bold fundamentally wrong comment if ever there was one. “Substantial debt remains but has receded thanks to disciplined fiscal management during the council’s last two terms.” What!!?

    At a consolidated debt of around $600 million, slightly less than the peak of some $623million, how can that be claimed as disciplined fiscal mangement? The truth of the matter is that this stadium has sucked up since its inception around $25 million per year on interest charges, subsidies (such as $7.92 million per year from Aurora, hence reduced dividends to the DCC annually) constant injections in the form of offsets against annual losses being posted by DVML (the management arm), direct cash injections by council in the form of rent shortfall subsidies, further injections by means of calling up and paying for uncalled shares. as well as subsidies to DVL the holding company carrying the construction debt.

    The truth of the matter is that there is a vast silent subsidy of prime user rugby by the simple expedient of undercharging for the use of the facilities which have been consistently hidden from public gaze under the ruse of “commercial sensitivity” whenever that information is sought via the LGOIMA.

    Then there was the obscene business of buying Carisbrook for a grossly inflated price of $7.5 million to be later onsold for the sum of $3.6 million to a developer who enjoyed most favourable terms resulting in the money not yet being received as payment. All the while the ratepayers pick up the tab for all shortfalls one way or another.

    An international rugby test match is always cited as bringing untold $millions into the city via the hospitality and accomodation businesses, neglecting to acknowledge that by far and away the biggest crowd component is the citizens and the surrounding areas who pay, go to the game then simply go home. That money is ‘local churn’ that if not spent there then elsewhere. What is real is the heavily subsidised costs of running the event that is in no way recovered,let alone show a profit direct to the Stadium. If there was then how to explain the annual deficits wracked up by DVML management.

    I guess though as long as the stadium is gifted to the elite users then we all need just to don our ‘rose tinted glasses’, suck up and believe the glib nonsense that is fed up to us.

  3. Gurglars

    The total weakness of the “economic benefit” argument is that if the DCC had upgraded Carisbrook, all of the economic benefits would have been exactly the same and the ratepayers would have been better off by $20+ million dollars annually plus the interest on $250 million annually.

    And the sound system would be better.

  4. Mike

    The ODT’s silent abridgement strikes again, I wrote a letter in response to this article http://www.odt.co.nz/news/dunedin/390428/spending-12-million-weekend-welsh-test that was so chopped up (without attribution) that it missed the whole point I was trying to make – that DVML had claimed to have brought $10m into the economy when today the ODT tells us they were wrong (without mentioning that they were wrong, again).

    Here’s what I originally wrote:

    Making numbers up
    ————————
    You know I think it’s probably time we just stopped listening to DVML, this happens every time there’s a big event, they make up a big number and claim it was spent – in this case they claimed $10m was spent (here I linked to the article http://www.odt.co.nz/news/dunedin/388268/rugby-test-massive-city) – not $1.2m. In the past they’ve been caught out with their consultants (who hadn’t even visited Dunedin) making up numbers based on Dunedin having 10 times as many hotel rooms than actually existed.

    The thing is even this $1.2m is just money spent, it’s not the amount of money left in the economy (profit by locally owned businesses, wages etc) – If I spend $10 on beer more than half of it leaves the city, goes to the brewery, the people who trucked it here etc. If I’m a local and drink an extra beer because of rugby, it will show up in this $1.2M even though its actually a net loss to the local economy.

    Neither of these numbers includes the wealth funnelled out of the local economy to the NZRU from locals who bought tickets, nor the amount taken from ratepayers to subsidise each one of those tickets

    Remember that most of our hotel rooms are full, any hotel that didn’t run with a high occupancy rate would go out of business, if a stadium event stops our usual tourist trade for a weekend and replaces it with rugby fans it’s a financial wash for the hotels, bars and restaurants that would have fed them.

    [ends]

    • Calvin Oaten

      Mike: You are absolutely right about DVML, the ODT, and other commentators such as the Hospitality group and Otago Chamber of Commerce with their outlandish claims of economic benefits to the Dunedin Economy by the hosting of the recent rugby ‘test’ at the Stadium. For what it is worth, this is an as yet unanswered letter I submitted on the 5 July.

      ODT Editor CC. Dave Cull.
      “Recently ‘our’ Stadium hosted a rugby test match between the All Blacks and Wales in front of a record crowd of some 25,000. Huge ‘big ups’ from all concerned, with this paper editorialising on the benefits of the ‘world- class stadium and the can-do people who own it’. Cited was the huge input to Dunedin’s economy via the event, the accommodation and the hospitality industry. All this is true up to a point.

      But one needs to investigate further to realise that all might not be as claimed. For instance, it would be fair to state that the majority of attendees would be our local citizens and those living in close proximity. Most, if not all, would have gone to the match then simply returned home (particularly those with their children). What then of the claims of economic gain to Dunedin?

      The oft unmentioned fact is that for an official rugby test under the auspices of the NZRU, it is known that the gate proceeds are the NZRU’s. From this it pays out to the host union, the ORFU, a match fee covering the costs of promotion etc, plus a KPI or performance bonus which goes towards it’s yearly result. Now if we conservatively assume a median ticket cost of $80 with 25,000 attendees that is $2million. After the aforementioned host costs, the balance is spirited away to the NZRU’s coffers in Wellington. The Stadium simply gets an undisclosed fee for the use of the facility.

      So I would ask Mayor Cull if he would explain how it is that it can be claimed that the Stadium is so beneficial to Dunedin, with the export of at least $1.5million out of the our local economy on this event alone? Why indeed is it that the ratepayers do not receive true value for the use of that facility, as the continual annual deficits posted by DVML attest? Why does council insist on denying that the stadium does in fact cost citizens in the vicinity of $25million per annum in debt servicing, subsidies and general promotion of the complex? Would it not be a test of council’s vaunted ‘open and frank’ policies of inclusion of the public, particularly in this, an election year? ”

      Note: To date (assuming this was forwarded to Dave Cull for comment) he has yet to respond.

    • Mike

      And now my chopped up response is gone as is my response to it apologising for the mistakes that had been made to what I had written.

      It seems that nude rugby is OK, but no one wants to know about naked emperors.

  5. Alex Brown

    Rugby’s business model is a form of socialism – socialise all expenses and losses while hoarding all the profits. The main problem with socialism is that eventually you run out of other people’s money.

  6. Elizabeth

    Fears South Dunedin also sinking
    By Chris Morris
    http://www.odt.co.nz/insight/dunedin/390570/fears-south-dunedin-also-sinking

    Any guesses as to where Chris Morris lives or owns land. It can’t be at South Dunedin.

    Today Mr Morris goes off half cocked and we can’t see any children.

    Safely out of view too, is anyone wanting to finance the game of core sample drilling for kicks at Surrey Street – where, before the sinkholes and lakes appeared, it might have been kiddies playing hopscotch.

    Funny that. But think of all the new homes on stilts ODT needs built at South Dunedin to make its forthcoming Home Show at the Stadium a howling retail success!

    [And we thought ODT’s GOB developer friends at the Taieri, intent upon ye olde classic suburban sprawl, would be plenty enough customers to limber up the stadium and the independent ‘news’ – indeed pumping glorious affecting double-page spreads on hollow beds, rickety dining tables and ill-sprung sofas in the local newspaper (to offset lately real estate firms leaving the ‘classifieds’, along with a couple of large vehicle dealerships). Revenue, Boys!]

    Not it seems, if Terry Davies has anything to do with the lolly scramble of house prices, newspaper survival, McMansions at Mosgiel, the sale of used power poles from Aurora to the august of South Dunedin – unpacking Chinese container loads of loud wallpaper for feature walls, cheap framed prints, plastic spa baths, gold taps, fake Aspidistras and sink disposal units.

    What a dreadful parochial little town Dunedin has become. The brain drain North has had such awful, fatal consequences : It has left the likes of Mr Morris high and soaked, marooned. While the rest of us have careered into catamarans, adapted barges, uber jet taxis, and house boats.

    First, flooding (June 2015); now, flooding (by calamitous subsidence).

    We adapt, we are The Water People. Yet, ODT can’t sell a paper with a cross word, or funeral notice. Soggy. Don’t be angry Mr Morris. You are the food for thought like ocean krill. Shored. At #DUD.

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