Auckland Council eyes $50m Eden Park bailout
Councillors to vote next week as cashstrapped trust presents proposals
A$50 million bailout of Eden Park was discussed by Auckland councillors at a confidential workshop yesterday. Faced with mounting financial pressure and no money for maintenance, the city’s premier stadium earlier pleaded for $100m from ratepayers to stay in business and the ability to continue hosting All Black tests and major events.
A leaked document shows councillors were presented with two proposals for Eden Park worth about $50m which will be voted on at a finance and performance committee next week.
The first proposal is for the council to take over a $40 million loan between Eden Park Trust and ASB bank with interest charged to the trust at commercial rates.
The second proposal is to provide $9.8m on interest-free terms, which can be drawn down over three years from July this year for maintenance work on projects such as new turf, floodlights and giant video screens.
The money would be secured by council and repaid in the event Eden Park assets are sold.
Previously, the trust asked council to take over the $40m loan and provide $64m for maintenance over the next decade.
A report done by consultants EY for Auckland Council late last year paints a bleak financial outlook for Eden Park, saying revenue is falling and there is no money for the $64m maintenance programme.
It faces losses of $80m over the next decade, EY said.
The proposal, which council sources refer to as a bailout, comes at a difficult time for the cashstrapped council.
The council’s regional facilities arm has its hand out for tens of millions of dollars for its latest stadium strategy, including $91m for a new cricket oval at Western Springs.
Regional Facilities Auckland is expected to announce a short extension for speedway staying at Western Springs, delaying a start on the cricket oval.
A bigger concern for council is a possible price increase of $500m to $1b for the $3.4b City Rail Link when tenders for the main contract are unveiled in May. Council and the Government are paying half shares in the project that will double capacity on the city’s rail network.
A funding request to Auckland Mayor Phil Goff from Eden Park for $1.5m to replace its deteriorating playing surface laid in 2003 sparked broader discussions on financial matters related to the park.
Goff has told the Herald Eden Park’s financial position is unsustainable and indicated a willingness to help in a way that protects ratepayers’ interest, including a commercial rate of return on the $40m loan.
A poll by UMR Market Research shows just 23 per cent of Aucklanders are in favour of ratepayers providing funding to Eden Park for it to stay open with 55 per cent opposed.
The poll also found 69 per cent of Aucklanders believed money paid to Eden Park should be in the form of a loan that is repaid.
Just 14 per cent were okay with a grant that does not have to be repaid.
The Herald has a copy of the poll with the client’s name missing.