Nobby Clark: ‘too easy’ to pass cost increases on to ratepayers

Invercargill Deputy Mayor Nobby Clark. PHOTO: ODT FILES
Invercargill Deputy Mayor Nobby Clark. PHOTO: ODT FILES
Invercargill's deputy mayor worries ratepayers are beginning to distrust their council because it "does not know what it is doing".

Nobby Clark said he raised concerns with council staff about projections for the Branxholme pipeline project and the redevelopment of the Civic Administration Building, the cost of which has nearly doubled from its original budget.

He could not accept the explanation from staff who said, "we don’t always get it right".

Cr Clark said in July last year, as part of the council’s long-term plan, it had budgeted $11.5 million to carry out an upgrade of the Branxholme water main.

Within one month councillors were given advice from management stating the cost of the project was closer to $20 million.

However, in March this year, during a risk and assurance meeting, a report showed an overall forecast budget of $25.35 million from the project.

"That worries me when you get a big difference like that and the response I got from the staff when I queried about this huge increase was ‘we don’t always get it right’."

Then at the same meeting, he said staff presented a forecasted budget for the Civic Administration Building renewal project of $27.5 million — $11.5 million more than the original budget of $16 million.

Cr Clark said he could not accept figures were that wrong after such extensive work from councillors and staff.

He said councillors took part in about 30 workshops on the annual plan and he could not comprehend how the cost had increased so much within nine months of the plan’s adoption.

"The whole idea of a long-term plan is to give some certainty for ratepayers.

"It is a huge amount of work and to be getting [those figures] horribly wrong is not good for me and I am sure that doesn’t create confidence for a lot of people in the business world or in the residential world.

"It seems council doesn’t know what it is doing."

He believed those mistakes were one of the main reasons for a proposed rates increase of 7.78%, almost doubling next year’s rates rise from what was previously forecast.

If people were not happy with the increase, Cr Clark urged them to make a submission on the annual plan, closing tomorrow.

"It is too easy to throw this bill to ratepayers."

Approached by the Otago Daily Times for comment, Invercargill City Council acting chief executive Erin Moogan said long-term plan project budgets were often developed five or more years ahead of a project being delivered and long before design commenced.

"As a result we don’t always get this right and need to make adjustments through subsequent annual plan or long-term plan budget processes."

She said the Branxholme budget was set at $11.5 million in 2019.

It was then adopted in the annual plan in August 2021.

Key impacts included a different route alignment required to what was originally envisioned and a requirement for underground drilling in two locations as the original costs were based on open trenching, she said.

As well as that, she said the increased market costs, professional services fees, escalation and contingency budget were not included in the original cost.

She said the Civic Administration Building project had a budget of $16 million, but early advice from staff indicated this budget was likely to be insufficient for a full refurbishment of the building.

"This is primarily due to there being a number of exclusions in the original project budget including not all floors of the building being in scope for renewal."

However, this project had not yet been designed and was still in the early planning stages.

luisa.girao@odt.co.nz

Comments

What a legend.The only councilor who cares enough to stand up for the ratepayers.Why are we subjected to excessive rate increases because the city managers cannot control cost of projects and services. The other councilors should hide their heads in shame.None are worthy of reelection.

 

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