Geoff Helisma|
At yesterday’s March 24 Clarence Valley Council (CVC) meeting, councillors made a decision that will complete “the major works associated with its rationalisation project”.
Councillors considered (after the Independent’s print deadline) how it would fund the planned $6,356,701 upgrade of its Prince Street offices – for its inclusion in CVC’s 2020-21 draft budget.
The project was set to be completed this financial year when CVC lodged its Fit for the Future improvement plan in early 2018.
Pending the councillors’ decision yesterday, the completion date is now August/September 20/21, with construction due to commence in September or October this year.
Staff have recommended that that CVC borrow $5million internally, from Regional Landfill Reserve ($2.5million) and the Plant Reserve ($2.5m).
This would be “repaid over a maximum 10-year period commencing July 2021, with interest to be based on CVC’s average interest on investments for the preceding financial year”, the report to council stated.
Internal borrowing requires the Office of Local Government’s approval under its capital expenditure guidelines.
On borrowing internally, staff wrote: “The capacity of the reserves is considered sufficient to still enable the program of plant replacement to proceed and landfill work to continue.”
The balance of funding would come from the Strategic Building Reserve ($1,050,783.52, funded by “the proceeds of any sale of surplus general fund property assets”, as per CVC’s long-term financial plan 2016/17 to 2025/26) and the Buildings Improvement Reserve ($305,917.48).
Staff will be housed at 42 Victoria Street while construction takes place.
The council sold the Victoria Street building in 2016 and has since leased the building for the purpose of housing staff while it undertook the rationalisation process, which included construction of the new depot at South Grafton.
“To achieve value for money to facilitate timely construction of the works there is the opportunity to relocate staff from 2 Prince Street to 42 Victoria Street up till September 2021 when the current lease expires,” staff advised in yesterday’s report to council.
The council will seek tenders for the project, pending the councillors’ decision, “in late April, early May 2020.
The estimate provided to councillors includes a $290,081 (5 per cent) contingency and staff have recommended adding another 10 per cent contingency, upon approving a successful tender, “over the tendered amount, to be delegated to the general manager as has occurred with most construction type tenders”.
Councillors will also consider establishing “a project steering committee responsible for administering and overseeing this project … the committee [would be] comprised of a councillor and the mayor, the council executive (general manager and 3 directors)”.
The project’s manager will report to this steering committee at regular intervals.
In July of 2016, the Independent asked general manager Ashley Lindsay, who was CVC’s corporate director at the time: Given that the premise upon which [CVC] properties are being sold – that is, to rationalise where staff are housed, and reliant on the depot at South Grafton being built; why are the leases for Victoria and Bruce streets guaranteed leases set at five and three years, respectively, which would, if all goes to plan, appear to be well outside the time it would take to relocate staff?
Mr Lindsay said: “At the time the lease agreements were prepared, council had not committed to the construction of the new depot at South Grafton.
“The three-year lease period for the Bruce Street depot will enable an orderly exit from the site. After the technical staff have been re-located from the Victoria Street office to the new South Grafton depot; the five-year lease period for Victoria Street will enable space for staff to be re-located from Prince Street office temporarily during refurbishment/upgrade of this office.”
Referring to the rationalisation “to consolidate depot and operational works facilities that occurred with the construction of the Rushforth Road Works Depot”, staff wrote in yesterday’s business paper: “The design of the upgrade of the Administration Centre at 2 Prince Street Grafton completes the major works associated with the rationalisation project.”