Op costs left out of the picture
‘Oversight’ lands new $6.5m Mahara Gallery in a big funding hole
Focusing too much on building the new Mahara Gallery at the Kā piti Coast and not considering how to fund its day-to-day operations has left a $400,000 hole in the art gallery’s operating budget.
That shortfall would equate to about a 0.5% increase in rates, an internal review by Kāpiti Coast District Council has concluded.
The $6.5 million project to upgrade the art gallery in Waikanae has been decades in the making. The work included more spaces to host exhibitions and storage to permanently house its Field Collection, which features 24 paintings by celebrated New Zealand modernist painter Frances Hodgkins and a trove of family documents. The new gallery will openin September.
The review was ordered by district councillors of the last triennium last September.
‘‘At the time the focus was on the construction of the new asset and the omission of operating costs increases appears to have been an oversight,’’ according to the council’s report, which was published last Thursday.
‘‘Ideally the requirement would have been identified and resolved through the 2021-4 Long Term Plan, which is where tradeoff and funding decisions around service levels take place,’’ the report said.
‘‘However this did not occur, and there is no obvious reason for the omission.’’
Currently, a council grant meets the gallery’s operating costs. The grant for this financial year sits at $223,239 and the grant for the 2023/24 financial year is set at $339,591, as part of the current 2021-2024 Long Term Plan which was adopted in June 2021.
The gallery’s board now estimates the new operating cost is about $740,000, with only $60,000 funded through sponsorships and non-council revenue, according to the review. Council officials estimate the shortfall is likely to be between $325,000 and $400,000.
District councillors had agreed to use $400,000 of Better Off funding from the Three Waters Reforms as the gallery’s operating costs until the end of June 2024.
But the figures didn’t account for the extra money needed to run a new, larger gallery that would open for more days each week.
The error was not discovered until February 2022, in a letter from the gallery’s board chairperson Gordon Shroff to the council’s then chief executive Wayne Maxwell, which The Post obtained.
‘‘The new Mahara Gallery, built to modern museum/gallery
standards, will be a more complex and sophisticated facility than its very basic predecessor, a former small library,’’ Shroff wrote.
‘‘To do justice to this greater capacity and to meet public expectation, the gallery will require more, and a greater range of, curatorial roles and administrative support services.’’
This meant rather than relying on volunteers, the gallery would hire staff to handle admission, retail and security arrangements to protect a collection worth $2 million. More specialist staff was also needed to expand the gallery’s education role.
But district councillors were left in the dark on all of this until a briefing seven months later.
The review recommended that officers should let councillors know of any emerging issues that might be ‘‘high profile’’ as early as possible.
‘‘Where a new asset is constructed or vested, the new service level and additional operating costs must be considered and presented to decision-makers at the same time as the capital cost.’’
Mayor Janet Holborow, who was on the gallery’s board for nine years and held the council’s arts and culture portfolio in the past triennium, said she became aware of the $400,000 shortfall at the same time as her colleagues.
A provision was made in the 2021-2024 Long Term Plan to allocate extra operating funding for the new gallery, but it fell through because of continuing delays and timing uncertainties, she said.
The district council’s place and space group manager, Mike Mendonc¸a, said the Long-Term Plan was in line with a 2013 feasibility study that provided an indication of increased operational costs carried out by museum consultant Richard Arlidge.
However, Mendonc¸a agreed officials could have ‘‘paid closer attention’’ to the impact the new gallery building would have on operating costs.
Shroff told The Post that the board would not have a clear picture of the new gallery’s exact operating costs until it was up and running.
‘‘It’s a complex project that took place over a number of years – a number of uncertainties were involved and there are still are a few,’’ he said. ‘‘We’ll need a bit of operating experience for a few months.’’
Further funding for the Mahara Gallery will depend on the next Long Term Plan, but the review warned that if no ‘‘substantial funding’’ was made available, the gallery’s board would be forced to reduce the level of services provided.
‘‘In practice this means a new facility will not be able to deliver on its potential.’’