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In the public forum at yesterday’s board meeting at Lake Hawea, former deputy mayor Lyal Cocks said the reserve should not be used as a "slush fund" to cover shortfalls in council spending.
In 2016, $15.6million was contributed to the reserve through the council’s sale of Scurr Heights land, overlooking Lake Wanaka, to developer Lane Hocking.
Since then, $6million has been spent on the new Wanaka swimming pool, leaving just over $9million.
Mr Cocks said the reserve should be used for projects that benefited the entire Wanaka ward.
He noted there was a need for new facilities for Kahu Youth, for gymnastics and for the toy library, and reserve money could be better spent buying the Mitre 10 building when that business shifted to its new premises in November.
Use of the reserve was recommended by council property director Richard Pope, who said the new Luggate Memorial Centre was designed as a wider community asset, and "not just for Luggate".
Cr Quentin Smith said use of reserve money on the centre "just met" the criteria.
Board member Ed Taylor noted the centre would be used for events such as the district-wide Festival of Colour.
Jude Battson, the only board member to vote against use of the reserve, suggested if it could be used for the Luggate centre then it could also be used for the shortfall in funding for the Wanaka Community Hub.
Cr Niamh Shaw moved the board agree to the reserve being used at Luggate, provided the amount was no more than $1million.
The council is budgeting to spend $4.845million demolishing the old hall, which is an earthquake risk, and building the new Luggate Memorial Centre.
The Central Lakes Trust is contributing $750,000 and the Otago Community Trust $400,000, with $300,000 being sought from the Lottery Grants Board.