Tag Archives: Capital funding

Stadium (fubar): cringe

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Thursday, 15 May 2014 10:35 a.m.

The Press 13.5.14 Letters to the editorThe Press 13.5.14 [click to enlarge]

These letters to the editor were published in reply to the strong article by Fairfax News reporter Wilma McCorkindale, Stadium could cost Dunedin ratepayers millions (Stuff 9.5.14).

[Note there are 36 online comments]

Posted by Elizabeth Kerr

5 Comments

Filed under Business, Construction, CST, DCC, DCHL, DVL, DVML, Economics, Media, Name, New Zealand, People, Politics, Project management, Property, Site, Sport, Stadiums

Stadium: DCC proposes extra funds for stadium debt repayment

Comment received from Mike
Submitted on 2014/05/11 at 12:42 pm

Now is a great time to remind people of section 63 the Local Government Act which reads:

Restriction on lending to council-controlled trading organisation
A local authority must not lend money, or provide any other financial accommodation, to a council-controlled trading organisation on terms and conditions that are more favourable to the council-controlled trading organisation than those that would apply if the local authority were (without charging any rate or rate revenue as security) borrowing the money or obtaining the financial accommodation.

http://www.legislation.govt.nz/act/public/2002/0084/latest/DLM171886.html

Which as I read it means that the council can’t fund DVML in a more advantageous way than it would receive itself from its own bankers – my reading of this is that just bailing DVML because it’s losing money would be illegal, they have to loan them money at a comparative rate to what they would get from the bank.

It’s an obvious target for a ratepayer’s injunction …..

The reason for this law is pretty obvious, the government wanted CCOs to compete with private enterprise on a level playing field – if DVML wants to rent out space it shouldn’t be able to undercut a competing landlord who can’t tap the ratepayers’ pockets to charge a rent below cost.

[ends]

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Dunedin City Council – Media Release 9 May 2014
Extra Funds Proposed for Stadium Debt Repayment

The Dunedin City Council will consider using savings to repay more debt associated with the Forsyth Barr Stadium. The Council will next week consider approving a one-off payment of $2.271 million to help balance the Forsyth Barr Stadium accounts. Of that, $1.77 million would be used to repay DVML debt, with the balance to fund a cash shortfall. The payment would be funded from DCC savings made in the current financial year. DCC Group Chief Financial Officer Grant McKenzie says, “A one-off payment to reduce debt further would be good for all parties and would clearly respond to community demand for the DCC to reduce its overall debt level.” Read more

Download the Forsyth Barr Stadium 2014/15 Budget Report (PDF, 200KB)

Media Stories:
9.5.14 ODT Stadium debt reduction to be considered
9.5.14 Stuff (Fairfax News) Stadium could cost Dunedin ratepayers millions
10.5.14 ODT Stadium payment may rise

Related Post and Comments:
9.5.14 DCC Draft Annual Plan 2014/15 Submission by Bev Butler
10.5.15 (via comment) ODT In Brief: Stadium review sought

Posted by Elizabeth Kerr

35 Comments

Filed under Business, Construction, CST, DCC, DCHL, DCTL, Delta, Democracy, DVL, DVML, Economics, Highlanders, Media, Name, New Zealand, ORFU, People, Politics, Project management, Property, Site, Sport, Stadiums

Prof Willett on stadium accounting practices

### ODT Online Sat, 11 Apr 2009
Method not misleading, prof says

By John Lewis

The head of the University of Otago accountancy and business law department has described as a “misconception” allegations by stadium opponents of misleading accountancy practices by the Carisbrook Stadium Trust.

Read more online here;

Read Prof Willett’s full response: ODT Link

• ODT says Prof Roger Willett is a past president of the Accounting and Finance Association of Australia and New Zealand. He has published articles and books on statistical aspects of accounting measurement, international accounting, management accounting and auditing. He is working on projects relating to the theory of accounting measurement, economic models and asset return, risk and valuation measurement in organisations and markets. He has held positions at Queensland University of Technology, Australian National University and the Universities of Wales and Aberdeen, and is a member of the Institute of Chartered Accountants in England and Wales.

6 Comments

Filed under CST, Economics, Hot air, Inspiration, Media, Politics, Stadiums, STS