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The Central Otago District Council meeting this week declined a request from Fenz to continue peppercorn rentals of rural stations in Omakau, Tarras, Alexandra and Millers Flat, instead opting to enter negotiations with the organisation on future agreements.
In 2014, the council helped establish the Otago Rural Fire Authority with other Otago councils. The council gave the authority peppercorn leases, which resulted in nominal rents of about $1.In July the authority became amalgamated with the national body, Fire and Emergency New Zealand.
Council chief financial officer Bernard Murphy said the council previously had a direct vested interest in the organisation, but it was now at arm’s length.
"We’re just saying that rather than roll over for a peppercorn rental we actually go into negotiations and see what comes of that. We don’t treat other government departments in the same way."
An example was Child Youth and Family which paid market rent for its office in Alexandra.
Mayor Tim Cadogan said other organisations which provided community good paid market rents and he did not understand why rural fire services should be different.
"Why should we set a precedent for them to come and knock on our door and ask to pay a dollar a year?"
Fire and Emergency New Zealand region 5 regional manager rural Mike Grant said it had many issues to discuss with the council regarding how operations would now work. He did not want to talk more about the lease arrangements of the stations until he became more familiar with them.
The council is also considering whether to request the organisation pay back a $427,000 loan. When the rural fire authority was established, Otago councils transferred ownership of assets including machinery, plant, vehicles and other items by way of loan. Central Otago’s loan amounts to $427,000.
This item was removed from the agenda so the council could discuss the approach with other councils.