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Monday
Aug112014

Whangamata Ocean Sports Club Inc.

One of the great ironies of attempting to give impoverished sports clubs and organisations providing social services around the Peninsula a 'hand-up' by standardising all rentals of Council owned property at $350 ($100 for emergency organisations) lies within the land leasing arrangments enetered into with the Whangamata Ocean Sports Club Inc. 

The no doubt well-meant, but nevertheless egregious outcome arose from a motion at an extraordinary meeting on 22 November 2006 which was to give an enormous advantage to this particular organisation that by any standards was even at then a highly profitable licensed establishment patronised by thousands of thirsty drinkers at peak times, and locals year around.

The Club with over 6,000 members has enjoyed extremely favourable treatment since 2006 in regard to its lease (previously carrying a 'commercial' rent of $17,235 + GST and 100% 'outgoings') principally as a result of a new and controversial clause in the motion:

(d) Council agrees that all clubs and community groups are treated equally regardless of whether they hold a liquor license or not.

This clause was apparently introduced in order to meet the demands of this particular Club, but was welcomed by others who were similarly advantaged. Nevertheless. the WOSC remained the 'biggie', and the one that raised eyebrows throughout the District when the Council's decision became known. Undoubtedly, the denizens of Whangamata were thrilled, though probably somewhat surprised at the Council's generosity. As a result, the Club's rental decreased from $17,235 + GST to $350 + GST per annum. It is not clear from the minutes whether anyone present at the meeting declared a 'conflict' - it passed unanimously.

This egregious situation is about to be exacerbated following a decision by the Whangamata Community Board that a new lease be offered the Club (at its request) replacing the existing arrangement which expires on 31 July 2019. The Board has agreed to a new Lease of 10 years with two 10 year extensions taking it out to 2044, all on the same $350 a year terms.

Based on the likely value of this land being in the million dollar category (valuation is not required under current arrangements, and irrelevant in view of its 'reserve' status), the minimum opportunity cost is probably well in excess of $100,000) When the multi-million dollar turnover of the Club is taken into account, the absolute rort on rate-payers becomes obvious.

It is futile to examine the motives of the 2006 Council in arriving at its decision, but that does not excuse the actions of the current Board in suggesting such a favourable deal out until 2044. It is not simply a cost to Whangamata rate-payers, though it is clearly falls within the 'empowerment' provisions introduced since the last election. Any loss of potential revenue is a cost on the entire Council, and this kind of 'non-commercial' arrangement with what is clearly an extremely profitable commercial entity (with 6,000 members!) is indefensible.

But the Board decision will no doubt be endorsed by our Council of Wednesday with little or no consideration of the long term consequences. In this manner, the 'rort' continues in the age-old 'you scratch my back and I'll scratch yours' tradition that appears to be becoming the hallmark of this Council.

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