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Wednesday
May312017

Zoom-Zone Dry Court Debacle Continues

It has become patently obvious that there has been a deliberate attempt to hide the disastrous outcome of the Zoom-Zone Dry Court (now to be known as the “Thames Community Recreation Centre”) contract. This appears to have been conducted under the purview of the Chair of the project Committee – Mary Hamilton, who has been the ‘power behind the scenes’ through the entire course of promoting, designing, and funding this project.

It was Mary who ensured that every possible cent available through our precious Urban Purposes Reserve fund were devoted to the project – over $2m – money that is now not available for any other project in this town, including the much needed swimming pool renewal, other than funds that accumulate over the next three years.

It was totally predictable of course from the moment the contract was awarded to a Matatmata company – Stanley Construction Ltd that was part of a group that had that year been forced into a “credit arrangement’ that left its creditors 80c short in the dollar. This embarrassing situation was followed by the incredible admission that our Council had “undertaken ‘due diligence’ on Stanley in every other respect but financial.“

Those of us with some experience in business understood just how incredibly risky it was to enter into any contractual arrangements with this company on such an important project to this town. The decision to proceed was taken by the Mayor at the time – Glenn Leach, Board Chair Strat Peters, and CEO David Hammond at an emergency meeting immediately after the ‘due diligence’ debacle was revealed in a post on this blog. There must be tears of anguish within the Castle at this point as that failure of judgement becomes clear.

I submitted a OIR last week seeking to extract the truth of what was going on when the possibility of a $700k over-run was revealed in the draft budget that went to Council on 16 May that will take the total cost of the Project to our rate-payers from $4.147m to $4.847m. Nothing was said at the time, indicating that the matter had been previously discussed behind a ‘closed- door’ workshop.

My OIR was as follows:

“I am aware that $700,000 was allocated in the draft budget approved on 16 May to cover the additional costs of the Indoor Sports Centre pending completion of negotiations, but have since heard that the Mayor has indicated that the actual additional cost is $450,000.

Can you please confirm if this is indeed the case, and if so, does it indicate that negotiations have been completed, and that this represents  the final figure arrived at?

Also, can you please advise exactly how it is intended that the additional cost is to be funded?

Are you in a position to reveal the details of what precisely led to the over-run?

I received the following answers ths morning:

“At this stage we don't have a definitive figure, so the information that you have been given is purely speculative.

The Council and the Thames Community Board have had a number of briefings about the Thames Indoor Sports Project which has focused only on the process and the setting of an upper bound estimate of potential costs, which we have $700,000 allocated in the budget.

When we have more certainty regarding a negotiated outcome, once this process has been completed, this will be brought firstly to the Thames Community Board and Council.

Funding for any additional cost will come from a range of options including:

·         Thames consolidated depreciation reserves; and/or

·         Thames Urban General Purpose Reserve and /or

·         Additional loans. (My bold)

There are a number of reasons for the claims for additional payments. These are subject to a satisfactory negotiated settlement reaching a conclusion and they include such matters as delays due to bad weather, unexpected ground conditions; additional earthworks and an extra toilet being included in the plans.” (My bold)

This ‘bad news’ will come as no surprise to anyone who has watched the progress of this project.  It has already absorbed the entire 10% ‘contingency’ that was established at the outset – we were told that this was due to “weather and ground conditions,” but we have since 'found out'  that the discovery of arsenic in old mine tailings on the carpark site, and their necessary removal, was the major cause of subsequent over-runs. This begs the question as to why adequate ground surveys were not conducted prior to the commencement of the project – a normal and indeed required prerequisite in this mine-tailing strewn town.

The addition of a toilet (presumably to meet the just announced PPTA recommendation for  ‘all-gender’ toilets in all new facilities to cater for the LBTQ community) is inexcusable when one considers the amount spent on architectural planning, or it is just a kneejerk reaction to the idiotic PPTA report.

As for the other excuses – these are simply not credible in the light of the normal contractual arrangements where the contractor is required to undertake its own ‘due-diligence’ and shoulder risk of this nature.

And as for the funding of the additional cost – it is absolutely unacceptable that our Board again revert to the Urban Reserve Account, the remainder of which we were promised would remain inviolable after their earlier 'raid,' and available from now on only for the proposed swimming complex. Again Zoom-Zone appears intent to be getting every available cent that has accumulated since from the dairy-farm rents.

I know for certain the Board members will be avoiding at all costs any further imposition on Thames rates that they regard as already at the top end of what they are prepared to defend, so expect further borrowing for whatever they cannot extract from the Urban Purposes Reserve. Most appear totally unaware of the history of the Reserve.

It is immaterial to me and countless other rate-payers just what a wonderful facility this spanking new building will be for the town – we will never have the opportunity of being able to use it. But good luck to those who will. I just consider the whole concept demographically ill-balanced when compared to the pool.

That aside, the whole process associated with way in which this project has been handled has reeked of incompetence from day 1. Chief Executive Rob Williams should have taken firm control from the outset of his tenure, and side-lined all those who have had a hand in it – amateurs all! And the deliberate obfuscation of what has been going on has been a disservice to rate-payers, and turned Board mnembers into 'nervous nellies' as they have tried to comply with the imposed 'secrecy ' - quite disgraceful really. 

As for the so-called fund-raising effort based on “pledges’ - never have I heard of budgets incorporating such funding as ‘firm.’ Far from it, it is my understanding that there are already disillusioned ‘contributors’, including substantial ones who wish to have nothing more to do with the project. Good-luck on securing their contributions.   

 

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Reader Comments (2)

Well done Bill. Thanks to your blog we have been able to observe this disaster in the making in a “movie-like” slow motion where we are the bystanders screaming at the top of our lungs to a dismissive Council - “get out of the way”, “can’t you see the danger”, “this will end in tears (and huge extra costs)” - for the last 6-7 years. Once again a small group of noisy agitators get their way to the determent and cost of the majority. Next instalment…..coastal erosion….same predictable outcome….

May 31, 2017 | Unregistered CommenterInsider

Dear Bill
Maybe we get what we deserve - take that however you may.
If more citizens and rate-payers were 'engaged' with our 'democratic process' and took elected representatives to task, then maybe there would have been a different result. Maybe not. Oh well, why bother was the cry; and no one has. Except you and one or two others. Forgive my descent into cynicism, but, as you and Insider point out, it is all so utterly predictable. Maybe Donald Trump is right after all?

May 31, 2017 | Unregistered CommenterRussell

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