Keeping equity funding at the status quo risked sending Dunedin Stadium Property Ltd debt from $85 million to $194m in 2060, they were warned.
Councillors are this week set to consider assigning more money annually for stadium debt repayment, amid rising operating and capital costs.
Two options have been put in front of them.
The option recommended by Dunedin City Council staff is to provide additional funding of $1.25m to Dunedin Stadium Property Ltd in 2026-27 and increasing it by another $1.25m the next year.
This would take the annual equity funding total to $5.4m from 2027-28.
The second option is to move straight away to $2.25m extra per year, but this would raise less money longer term and allow little room to move in dealing with unexpected costs.
The status quo was discounted, as it was considered "clearly unsustainable".
In a report for councillors, Forsyth Barr Stadium was described as a strategic asset that played a significant role in the wellbeing of the community.
"The attraction of events to the stadium delivers substantial economic and cultural benefits, enhances community engagement, supports local businesses and provides a wide range of recreational and entertainment opportunities."
However, the stadium had reached a point in its life cycle where operating and capital expenditure requirements were increasing.
Additional debt was needed to cover ongoing operating and capital costs, the report said.
It had been signalled upgrades were required.
Key assumptions of a financial model included that the economic life of the stadium would be 50 years, out to 2060.
The forecast fair value of the land was assumed to be $51m in 2060.
Turf replacement would be needed in 2031-32.
It was assumed the roofing could last for 40 years, and beyond, so roof replacement was not included in the forecast model.
The overall aim of the options was to bring the level of borrowings under the value of the land at the end of the stadium’s life.
The recommended option would do this comfortably, making the estimated debt $37m by 2060.
This option would provide some headroom for any unanticipated expenditure not provided for in the financial modelling, such as needing to replace the roof before 2060, the report said.
The second option would bring estimated debt to $49m in 2060, being close to the estimated fair value of the land that year.
This option would not provide head room for unanticipated spending.
The city council has signalled an overall rates increase of 10.5% could be looming for Dunedin residents in 2026-27.
Three Waters rates could increase by 16.7%.
The recommended option for stadium debt repayment would take the non-water component of the projected rates increase from 6.1% to 6.9% in 2026-27.
Taking the other option would push this up to 7.5%.
