Ratepay­ers down $2m

Matamata Chronicle - - Happy New Year - By STEVE ED­WARDS

After 17 years, a Mata­mata-Pi­ako Dis­trict Coun­cil in­vest­ment in over­seas shares ul­ti­mately cost ratepay­ers almost $2 mil­lion.

The coun­cil’s draft Long Term Plan said an orig­i­nal in­vest­ment of $12.05 mil­lion saw a re­turn of $10.35m when the shares were sold in Oc­to­ber.

In 1997/98 Te Aroha-based elec­tric­ity company Power New Zealand (for­merly Val­ley Power and Thames Val­ley Elec­tric Power Board) was wound up and the coun­cil given $24 mil­lion to invest.

The coun­cil in­ter­nally bor­rowed $11.95 mil­lion and in­vested $12.05 mil­lion into over­seas shares.

An­nual in­come of about $600,000 from in­ter­nal in­ter­est and $390,000 from div­i­dends on the over­seas in­vest­ments was used to sub­sidise rates.

In its draft plan the coun­cil said the value of the over­seas shares had some ‘‘sig­nif­i­cant ups and downs,’’ caus­ing un­ease for ratepay­ers.

The to­tal fund re­mains at about $24 mil­lion, with $19 mil­lion in­ter­nally bor­rowed and $5 mil­lion in the bank.

The coun­cil said it ex­pects to gen­er­ate in­ter­est of $1.15 mil­lion an­nu­ally.

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