Construction of the Forsyth
Barr Stadium in Dunedin will cost ratepayers at least $261
million, updated figures confirm.
The figure is the combined cost to be paid by the Dunedin
City and Otago Regional councils, and comes after it was
confirmed last week the city council had begun borrowing the
$109 million it needs to fund the project.
The new total came from adding the principal of loans taken
out by the local authorities and the cost of repaying them.
It does not include some of the more contentious issues
linked to the stadium, including whether the realignment of
State Highway 88 should be included in the cost, or the cost
of buying Carisbrook - an unconfirmed figure of $7 million.
Asked to respond to the figures, Mayor Peter Chin said it was
"fair enough" to do the sums calculated by the Otago Daily
Times but noted the same exercise could be done with other
council projects, including the $104 million Tahuna outfall.
City council finance and corporate support general manager
Athol Stephens provided the city council's figures after a
request from the Otago Daily Times.
There have been many changes to the way the stadium is being
funded in the past two years, including the Government's
contribution of $15 million, changes to private-sector
funding and a $10 million increase in the expected cost of
acquiring land at the site.
But Mr Stephens said the cost of the stadium itself had
remained remarkably constant.
He argued the cost of buying Carisbrook should not be added
to the list of costs to ratepayers "because the money
associated with that transaction was not used to fund the
stadium".
"It's a way of dealing with a vacant site."
Mr Stephens said last week the money spent buying Carisbrook
could be covered, and even a profit made, depending what
decision was made on its future.
The cost to the city council of repaying its $109 million
loan was calculated by council financial planner Carolyn
Howard yesterday at $95 million.
That was less than Mr Stephens' estimate last week, when he
suggested "a rough rule of thumb" was that repayment of such
a loan would cost the borrower the same as the sum borrowed:
$109 million.
Mr Stephens said while the council was borrowing to cover the
shortfall in private sector funding - revenue from sales of
products including seating packages and sponsorship - that
should not be included in the ratepayers' costs.
"The ratepayer does not make the payments of servicing it
[the debt]," he said.
The loan for private-sector funding would be on top of the
$109 million the council was borrowing, but the council would
not be repaying it - that obligation would be met by sponsors
and people buying the seating.
Carisbrook Stadium Trust commercial manager Guy Hedderwick
said last night the private-sector funding tally now stood at
close to $26 million, up from $24 million in April.
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