Council confirms round one of successful tenderers for the Moss Vale Indoor Aquatic Centre
Tenders for the first stage of the Moss Vale Indoor Aquatic Centre were presented to councillors of Wingecarribee Shire Council in a closed session of Council on Tuesday evening.
The determination of tenders for stage one of the Indoor Aquatic Centre comes after councillors were presented with a detailed financial analysis of the proposed facility by Council’s Deputy General Manager Operations Phil Marshall.
Mr Marshall’s report examined much material already considered by Council plus additional information including possible financial implications, interest repayment options and debt service ratios. This report was also used as the basis for a response to the Division of Local Government (DLG).
Chairman of the Indoor Aquatic Working Group, Councillor Larry Whipper said the report provided greater transparency and financial scrutiny.
“The report detailed numerous funding and loan repayment scenarios,” he said. “It lends further weight to our decision to proceed with the construction of this long awaited facility.”
Following the presentation of the report, councillors rejected the Notice of Motion in a vote of five to four which will subsequently see the project begin before the next councillors are elected in September.
“As the Chairman of the Indoor Aquatic Working Group, I have always maintained that this project has been on the back-burner for too long,” Councillor Whipper said.
“After some 20 years of false starts, we can finally look forward to providing all of the Shire’s citizens and visitors with a first-class indoor swimming and fitness facility.”
The report presentation and subsequent Council decision follow a positive meeting and exchange of letters with the DLG, who made it clear they were interested in the Capital Expenditure Review process, and not the validity of the project itself. Their areas of concern, addressed in Mr Marshall’s report, centered on the separation of interest and capital repayments, facility costings and community consultation.
In addition to detailing the expenditure report, Mr Marshall’s report itemized the loan amount – based on $8.428 million over 20 years at 7 per cent – and included variations in payment options and percentage rates which illustrated how the loan could possibly be paid off earlier.
The document also detailed the debt service ratios (DSR) the project was expected to attract in its first three years (a DSR is a financial indicator that highlights the potential risk involved with the amount borrowed versus the ability to pay it off).
These amounts were estimated at 1.4 per cent to the end of June 2012, 4.3 per cent to June 2013 and 4.0 per cent to the end of the 2014 financial year. All these amounts well below the DLG’s satisfactory debt service ratio of under 10 per cent.
Also included in the report were mechanisms to reduce the annual repayments from $920,000 to $786,000 per annum which would be met from Council’s approved rate pegging and Infrastructure Recovery Schemes.
“The DLG themselves state that the use of loan funds for infrastructure improvements and other capital purposes is considered to be a prudent financial strategy allowing for the contribution to the cost of the asset through its life by the community,” Councillor Whipper added.
“However, as the Deputy General Manager prudently advises in his report, the management of any facility – from its initial construction through to its long term operation, which includes financial administration – is critical to the success of any major project.
“The Indoor Aquatic Working Group is subsequently confident from the additional information provided, that the Moss Vale Indoor Aquatic Centre will be a successful major asset of benefit to all of the Shire’s residents for many years to come.”
The meeting with the DLG follows the Joint Regional Planning Panels (JRPP) deferred commencement approval late last month of Council’s Land Use Application (LUA) for the project.
The deferred commencement requires certain pre-conditions to be satisfied before the approval becomes operational and can be acted on. These include the preparation of a detailed landscaping plan, minor modifications to the eastern car park and provision of amended drawings.
In total three tenders totaling $1.14 million were awarded in the Closed Council session. They included tenders for the structural steel work, electrical and hydraulic (plumbing) services.
Combined, the three successful tenders were more than $85,000 under budget.
The successful tenderers are expected to be notified by the end of the week. Awarding of these tenders will be conditional on Council meeting the JRPP’s deferred commencement conditions.
In a bid to gain maximum financial benefit, councillors agreed to re-tender for the roof and wall cladding and concrete works. Council reminds local contractors and suppliers to apply for all future tenders.
Demolition of the existing Moss Vale Pool and pre-construction works are expected to begin within the fortnight.