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Dunedin city councillors yesterday agreed, subject to final approval, to borrow an additional $2.5 million to complete the redevelopment of the Dunedin Centre.
Council property manager Robert Clark told councillors considering the council's long-term budget, that earlier this year staff had indicated to council the project was going to come in $5 million under its original $45,835,000 budget, which was reduced in the draft long-term budget and the savings on debt servicing recognised.
"Unfortunately", since then a little bit more than he had hoped had been spent on things such as the contamination under the Town Hall, which the team were still finding, and several fundamental items found to be missing from the original scope of work, Mr Clark said.
Those included redecoration and upgrading for compliance purposes.
That meant he had to ask for $2.45 million of those savings to go back into the project.
A report from the council's financial planner to councillors said the money would have to be borrowed, with a rates impact of $116,600 for the 2012-13 year, and $233,200 for the 2113-14 year.
Councillors voted to reinstate the cost of servicing the extra debt for that.
They also, after significant debate about the value of upgrading the Harrop St area, voted to defer the improvements, saving $300,000.
Mr Clark's report to council noted staff had investigated the option of providing a more functional entry to the Town Hall from Moray Pl, but that it cost about $2.7 million, so it was not progressed further, based on the direction to staff to maximise cost savings.