Underspend goes to Bond St project

In a move rarely used since the Dunedin City Council starting cracking down on spending, councillors have agreed to use underspend to complete a project, rather than to pay back debt.

The council agreed yesterday to spend an $80,000 underspend in its transportation operations capital expenditure budget - money saved on a central city paving project - to complete improvements in the northern section of Bond St in the city's historic area.

The work is part of an amenities project under way for the warehouse precinct, but the Bond St section was going to have to be cut because some unexpected issues, including discovering concrete under Vogel St, led to an overspend in the project budget.

Council chief executive Dr Sue Bidrose told Cr Hilary Calvert, when she asked whether the money was not better to go to repay debt, that the council tried to avoid the practice of using underspend for projects, preferring in the past few years to channel it into debt repayment, but this was an exception, as it made more economic sense to complete the project while contractors were there, rather than have to pay establishment costs again to do it later.

Only $60,000 was needed to finish the basic work, but councillors agreed to use the whole $80,000 available to install more lighting and/or a few trees in the street, which was likely to be the main pedestrian thoroughfare to the central city from a new hotel being developed in the former chief post office building.

It made sense to make that extra bit of investment to get as much done as possible, Cr David Benson-Pope said, and it was reasonable to show local investors, such as the hotel's developer, the council was committed to the area's revitalisation, particularly as the council had been quite public about showing support for other potential hotel projects in the city.

As long as it was not a situation where no other work was deferred or carried forward - and he would be watching to see it was not - putting the money into that project made economic sense, Cr Richard Thomson said.

Councillors voted to pass a proposal from Cr Lee Vandervis to spend $60,000 to get the Bond St work done, as per an option put by staff, and then approved a motion from Cr Benson-Pope, putting the remaining $20,000 towards the project.

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