Coun­cil spend­ing out of con­trol

Kapi-Mana News - - OPINION -

In Kapi-Mana News (June 9) the CBD re-devel­op­ment cost is stated to be $21 mil­lion. But this still ex­cludes:

1. Re­lated cost of ac­quir­ing and hold­ing land and build­ings pur­chased for the re-devel­op­ment, like re­pairs and main­te­nance, in­sur­ance, legal fees, real es­tate fees, con­sul­tants, prop­erty man­agers, in­ter­est and other fees.

2. Work to be funded from de­part­men­tal bud­gets, like roads, parks, wa­ter, foot­paths, etc.

3. Lost rates and rental rev­enue.

4. Costs of sell­ing the new or re­de­vel­oped build­ings.

Plan A was to get pri­vate de­vel­op­ers and fi­nanciers in­ter­ested.

Re­tail­ing is be­ing over­taken by the in­ter­net, and it’s not an at­trac­tive res­i­den­tial area.

It’s a high-risk in the event of a tsunami, ris­ing sea lev­els, and liq­ue­fac­tion post-earth­quake.

But such mat­ters are triv­ial to coun­cil­lors spend­ing ratepay­ers’ money, so they have, and con­tinue to, ap­prove land and build­ing pur­chases, largely be­hind closed doors.

So hav­ing used ratepay­ers to pur­chase a mot­ley se­lec­tion of land and geri­atric build­ings, at pre­mium prices, now cost­ing the city se­ri­ous dol­lars ev­ery year, de­spite de­fer­ring main­te­nance, what next?

Plan B is for ratepay­ers to pro­vide cash in­cen­tives to in­vestors, de­vel­op­ers and busi­nesses, like rate and rent

hol­i­days, dis­counted per­mit fees, ur­gent changes to plan­ning and build­ing rules, free or dis­counted fitouts, and dis­counts on pur­chases.

At $21m (equiv­a­lent to $400 for each per­son living in Porirua), the coun­cil is still de­luded about the true cost of the city cen­tre re­de­vel­op­ment. It will end up cost­ing $1000-plus per per­son.

Our mayor states that res­i­dents who don’t sup­port the CBD re­de­vel­op­ment ini­tia­tives should think about and be grate­ful the coun­cil bought Aotea, North City and the Me­gaCen­tre land, and sold it to de­vel­op­ers.

Ac­tu­ally Porirua res­i­dents bought and held the land, through high rates. And high rates in­creases. And de­ferred main­te­nance, and no new in­fra­struc­ture.

Per­haps the mayor will dis­close pre­cisely how much ratepay­ers made (or lost) on each of those land deals, af­ter de­duct­ing all di­rect and in­di­rect costs, up to and in­clud­ing the time of sale.

The CBD re­de­vel­op­ment project is the lat­est, where the only

peo­ple to fi­nan­cially ben­e­fit from this project are those sell­ing the land and build­ings to the city, con­sul­tants, real es­tate agents and buy­ers.

They re­ceive a hand­out, while ratepay­ers carry all the costs and risks.

‘‘The price of growth’’ is what we will be told when rate in­creases hit dou­ble fig­ures in the next three years, un­less there are fur­ther re­duc­tions in our al­ready low core in­fra­struc­ture main­te­nance bud­gets.

Newspapers in English

Newspapers from New Zealand

© PressReader. All rights reserved.