The Wanaka Community Board has agreed to use half a million dollars from its fiercely protected asset sales reserve fund to help write off debt and strengthen relationships between the town’s cash-strapped community hub and its tenants.
Wanaka Community House Charitable Trust (Wanaka Community Hub) chairwoman Yeverley McCarthy said last week she and her team members were ‘‘absolutely delighted’’ to be close to resolving a three-year funding crisis.
The trust was now ‘‘waiting with bated breath’’ for the Queenstown Lakes District Council to approve the decision at its April meeting.
‘‘If this grant comes through it will leave us with $120,000 in debt, out of nearly $4million that it cost us to build,’’ Mrs McCarthy said.
The Alpine Community Development Trust (Community Networks) and other tenants raised concerns about relationships with the trust in September last year.
Aspiring Law stepped in to mediate and a confidential resolution was reached in February. Mrs McCarthy said the relationships were good and issues were resolved in half a day.
When the $3.95million building opened in November 2019, the trust had outstanding debts of $800,000, including extra costs incurred when building contractor Arrow International went into liquidation in April 2019. The council gave a $500,000 interest-free loan to tide the trust over.
The trust had to cancel fundraising events during the pandemic, but they would return later this year, Mrs McCarthy said.
The board voted for the council to convert the loan to a grant, to be paid from the asset sales reserve fund, effective immediately on approval.
Discussion on the issues was conducted partly in public and partly with public excluded at last week’s board meeting. Deputy chairman Ed Taylor said the council needed to learn lessons from the community hub and get involved with community-initiated projects at the start.
He preferred not to use the reserve but said he could live with it but warned it should not set a precedent for other groups building assets for a community purpose.
Cr Quentin Smith, the board’s representative with tenant Alpine Community Development Trust, said the loan should be converted to a grant but should not come from the fund.
Council community services general manager Thunes Cloete said if the grant came from the fund, it would not affect Wanaka ratepayers.
If it came from the general rate, it could spark a small rates rise for Wanaka, plus objections from Wakatipu about funding a Wanaka facility.
If the loan was not converted into a grant, the council would be repaid but could attract negative publicity about not supporting the community and miss an opportunity to achieve the mediated outcomes between the hub and its tenants, Dr Cloete said.
The board’s recommendation also included prioritising community organisations over commercial bookings once the debt was paid.
Wanaka’s $15.6million asset sales reserve fund was created after the council sold a large block of land in Scurr Heights in 2016.
The fund has been slowly used on major council-initiated projects, such as the Wanaka Aquatic Centre ($6million, opened 2018), the Mt Iron reserve purchase (not yet disclosed) and the new Luggate community hall ($1million, still under construction).
-- MARJORIE COOK
