DCC: What happened to $20 million cash on hand? #LGOIMA

1. Council had $22 million cash on hand.
2. Council spent $20 million (cash) on “capital projects”.
3. Council won’t account for the $20 million.
4. Council seeks open cheque to make discovery.

█ Report – FIN – 08/09/2014 (PDF, 2.3 MB)
Interim Financial Result – 12 Months to 30 June 2014

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On 8 September 2014, the Council’s interim financial result for 12 months to 30 June 2014 was tabled at a meeting of the Finance Committee. A week later, ODT (15.9.14) reported Mayor Cull as saying there was a “significant improvement” to the Council’s core debt position.

In the same item, “Council group chief financial officer Grant McKenzie said the turnaround was partly due to a significant change in the amount of cash held by the council. The forecast had included about $22 million in “cash on hand”, but, since Mr McKenzie’s arrival, the decision had been made to slash the amount to about $2 million, he said. The cash was instead used to pay for capital projects, avoiding the expected need to borrow for the work, which reduced the council’s need to borrow by $20 million, he said.” ODT Link

What if? flagged the ‘cash-no-longer-on-hand’ illumination with a post:
● 15.9.14 Cull’s council spent the cash

Capital projects?
How was the money spent, and who by?
Then, we completely lost sight of it.
As the following correspondence shows, Council spent $20 million of ratepayer funds but refuses to declare where the cash went. Mr McKenzie plays the convenient game of obfuscation —like so many before him, and alongside him now at DCC.

█ Apparently, I’m to be personally charged for demanding relevant paperwork to track down the Public Money.

Accountability? Transparency? What the HELL is that?
NOT something DCC values, that’s a dead cert.

[begins]

From: Elizabeth Kerr
Sent: Tuesday, 23 September 2014 11:13 p.m.
To: Sandy Graham [DCC Group Manager Corporate Services]
Subject: LGOIMA request

Dear Sandy

Re: Cull warns debt still hurdle for council (ODT 15.9.14)http://www.odt.co.nz/news/dunedin/315949/cull-warns-debt-still-hurdle-council

Within the news item it says:

“The forecast had included about $22 million in “cash on hand”, but, since Mr McKenzie’s arrival, the decision had been made to slash the amount to about $2 million, he said.

“The cash was instead used to pay for capital projects, avoiding the expected need to borrow for the work, which reduced the council’s need to borrow by $20 million, he said.”

I would like the DCC to precisely itemise the way(s) in which the city council has spent this $20 million of “cash on hand”, to include the capital projects by name or other reference; the name(s) of the relevant council department(s) and or committee(s) that incurred this expenditure; the dates of expenditure; the spending delegations attributable to which, by name, formal signatories on account; and any other information in legible form that would assist the city council to meet my request in a forthright, full and transparent manner.

I look forward to reply.

Thanks, kind regards

Elizabeth Kerr

__________________________

From: Sandy Graham [DCC]
Sent: ‎Wednesday‎, ‎24‎ ‎September‎ ‎2014 ‎9‎:‎01‎ ‎a.m.
To: Elizabeth Kerr
Cc: Grace Ockwell [DCC]

Thanks Elizabeth

I have forwarded to staff to consider and a response will be provided as soon as possible but in any event within twenty working days. It may be that I need to come back to you with questions of clarification or refinement depending on how this information is stored/held but I will be in touch as required.

Warm regards
Sandy

__________________________

From: Elizabeth Kerr
Sent: Friday, 31 October 2014 1:42 p.m.
To: Sandy Graham [DCC]
Cc: Grace Ockwell [DCC]
Subject: Re: LGOIMA request [DCC expenditure of $20M cash on hand]

Dear Sandy

The official information request I made on 23 September 2014 (see emails [above]) is yet to have a response, we are now well outside the twenty working day limit.

Please provide update on how soon the information will be released.

Many thanks, and kind regards

Elizabeth

__________________________

From: Sandy Graham [DCC]
Sent: ‎Friday‎, ‎31‎ ‎October‎ ‎2014 ‎2‎:‎03‎ ‎p.m.
To: Elizabeth Kerr
Cc: Grace Ockwell [DCC]

Sorry Elizabeth.

My fault. I had been supplied with a response and had not forwarded it.

The Group Chief Financial Officer advises:

“This request cannot be completed for what they are requesting as I do not know what capital and operating activity we would assign to the $20 million. In addition the work involved in getting the invoices etc would be significant. What has happened is that we have used our cash on hand to fund council activity (operating and capital) instead of borrowing to do this.”

If you would like me to pursue the possibility of tracking down invoices, I would need to consider charging for this work because there would be significant collation and research required, and even then, we may not be able to fully answer your question. Let me know if you would like me to investigate this further.

The GCFO has indicated he is happy to meet and talk through the issues but is unable to provide any further information at this stage.

Again, apologies for my tardiness.

Sandy

__________________________

From: Elizabeth Kerr [mailto:ejkerr@ihug.co.nz]
Sent: Friday, 31 October 2014 2:05 p.m.
To: Sandy Graham [DCC]
Cc: Grace Ockwell [DCC]; Grant McKenzie [DCC GCFO]
Subject: Re: LGOIMA request [DCC expenditure of $20M cash on hand]

Dear Sandy

Thanks for getting back to me promptly today. I acknowledge receipt.

I’m considering your response fully and as a consequence looking into all my options.

Kind regards, Elizabeth

[ends]

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Serendipitously, the same day (31.10.14), I heard from Cr Lee Vandervis —unbeknownst to me, a couple of days earlier he had voiced a similar query about the [MISSING PRESUMED DROWNED] $20 million “cash on hand”, and more, following his study of the Council’s Annual Report 2013-14.

█ Report – Council – 30/10/14 (PDF, 2.5 MB)
Approval and Adoption of Annual Report

[begins]

—— Forwarded Message
From: Lee Vandervis
Date: Tue, 28 Oct 2014 22:38:15 +1300
To: Sue Bidrose [DCC], Sandy Graham [DCC]
Conversation: Annual Report
Subject: Annual Report

Hi Sue,

The beginning of the Annual Report seems very reassuring with your highlighting our billion dollars worth of saleable assets, and our debt levels in pretty good shape and improving.

Looking further into the body of the report there is a lot of tabulation of various kinds of assets, but I seem not to be able to find the same depth of discussion on debt or the historical debt graph that I fought for years to finally get included. [A Consolidated term liabilities figure of $622,843,000 does appear on p199. I had been led to expect a historical graph of DCC debt and of total consolidated debt]
Is it possible to also have a graph of all inclusive historical staff costs included? There was one a while ago but it seems to have been dropped again.

At the end of the document I find a number of graphs that feature a fetching orange colour bar that seems to indicate that our “thriving and diverse economy” under Affordability has exceeded our LTP quantified limit on rates income in 2013 and 2014, exceeded the quantified limit on rates increase this year, slipped below the balanced budget benchmark, and also slipped below the essential services benchmark for this year.
It is no surprise to me that Citipark has not achieved targets, but I am surprised that your opening comments are so upbeat when the closing benchmarks are not met and the quantified limits seem to be exceeded.
These benchmark and limit graphs may have been misinterpreted by me because despite reading them several times I remain unsure of their real import.
Is it possible for someone to explain to me how the ‘pretty good shape and improving’ overview is supported, especially in light of the $20 million cut [from $22 million] in cash on hand and various sales that we have apparently recently instituted, combined with further expected constraints on DCHL subvention payments?

Looking forward,
Lee
__________________________

—— Forwarded Message
From: Lee Vandervis
Date: Fri, 31 Oct 2014 15:34:29 +1300
To: Debbie Porteous [ODT], Nicholas GS Smith [ODT]
Conversation: Annual Report
Subject: FW: Annual Report

Hi Debbie,
The Tuesday 28th email [above], which still remains unanswered, may help explain some of what deeply concerns me regarding yet another DCC Annual Report presented as up-beat.

Kind regards,
Cr. Vandervis
—— End of Forwarded Message
—— End of Forwarded Message

[ends]

If there was a plot to hide the way $20 million slid from sight, it thickens.
Not done yet, because I’m not a turkey dinner.

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Posted by Elizabeth Kerr

Whaleoil / Cameron Slater on ratepayers’ lament

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█ Cartoon of the Day (Len Brown by SonovaMin)
Posted by Cameron Slater on July 18, 2014 at 11:00am

█ Len Brown’s failures will cause Auckland headaches for decades
Posted by Cameron Slater on July 18, 2014 at 11:30am
A Local Authority like Auckland Council plans capital expenditure for urban projects – like the pretty CBD road and footpath improvements. The problem with infrastructure maintenance is that it is very expensive, and it occurs in the future. Competing against the pretty high profile projects it suffers because it takes second place. On the Audit NZ website is a document that records an audit of the performance of Local Government that is pertinent to this topic.
Read more

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Posted by Elizabeth Kerr

University: Leith flood protection scheme and landscaping

Proposed landscaping within the university’s heritage precinct. The St David St footbridge will be extended. [graphic via ODT]

### ODT Online Wed, 24 Jul 2013
Registry stretch of Leith set for summer revamp
By Rebecca Fox
The stretch of the Water of Leith in front of the University of Otago’s registry building looks set to get a multimillion-dollar makeover this summer. Students, staff and visitors could soon be able to walk along grassy verges next to lowered banks of the river, from the St David St footbridge to the Union St bridge, if a design plan is approved at an Otago Regional Council committee meeting tomorrow.
It has been about seven years since the council and the university signed an agreement to work together to produce a plan to suit the council’s need for flood protection and the university’s need for an aesthetic look in front of its historic registry building.
The council had budgeted $5.4 million over the next 12 months for the work. The university and the council are each to fund half the cost of the aesthetic work.
Among the work to be endorsed by the committee is the lowering of most of the concrete wall on the east bank, extending the footbridge, cutting down the west bank and landscaping and footpath redevelopment.
Read more

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Related Posts and Comments:
27.5.13 Carisbrook and Leith flood protection
17.11.10 Leith Lindsay Flood Protection Scheme
17.5.10 Campus Master Plan
28.1.10 University of Otago Campus Master Plan

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Posted by Elizabeth Kerr

D Scene – South Dunedin library, Hillside, RWC 2011

### D Scene 26-5-10

Former councillor welcomes news (page 5)
News that negotiations for a potential site for the South Dunedin library are all but finalised has been welcomed by former St Kilda councillor Anne Turvey.

Turvey said the issue is greater than that of the simple provision of a library.

{continues} #bookmark

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Talk: Dunedin on Dunedin (page 8)
Your say: Letters to the editor
Give New Zealand workshops a go by Stuart McKenzie, Dunedin
In a dream world by Jimmy Jones, Caversham
#bookmark

Register to read D Scene online at http://fairfaxmedia.newspaperdirect.com/

Details: The finer points (pages 9 -10)
South in a spin
By Mike Houlahan
Planning is already well in train to make sure Rugby World Cup 2011 will be about more than just the games. Rugby World Cup chief executive Martin Snedden is, naturally, taking a keen interest in whether Dunedin is ready to host its allotted Rugby World Cup games next year. But it is the combined promotional campaign devised by Otago and Southland councils and tourism organisations that has got him really excited.

“Have you seen the Spin It Wide DVD?”

{continues} #bookmark #bookmark

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Biz: Crunching the numbers (pages 12-13)
Light at the end of tunnel?
KiwiRail’s Hillside workshop is a hive of activity right now, but remains a shadow of its former self. Mike Houlahan considers the past, present and future of a Dunedin landmark. Amid the smashes and the clashes that are KiwiRail’s Hillside Workshops hard at work, it’s easy to forget that the workforce at the South Dunedin institution is about 10 per cent of what it once was.

Today, Hillside employs 185 staff. A few decades ago, when rail was the dominant means of moving freight and people around New Zealand, more than a thousand people worked at Hillside, building and maintaining locomotives and carriages.

{continues} #bookmark

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Scarfie: Life on campus (page 19)
Audacious winners: Design Studies students do well in entrepreneur competition
Designing a future
By Gavin Bertram
Last week the ten winners of the NBR 24/7 Audacious Business Idea Competition were announced, and four were from Design Studies. That’s not a bad return from the University of Otago department that is soon for the chop – an irony not lost on the students.
{continues} #bookmark

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Post by Elizabeth Kerr