Here we go
again. Our energetic and effective
Minister for Sport, Terry Waldron recently opened the refurbished Kulin Aquatic
Centre. It boasts a 25m lap pool,
learn-to-swim pool, beach entry and a tiny tots pool. The population of Kulin was 900 at the 2007
census and declining at 3.9% per annum.
In the same census, Denmark had a population of about 5,000 growing at
3.6%.
Yet here we are still
waiting for Council to make up its mind whether it will support even an attempt
to do something about it. The growing
sense of community frustration is evident to DACCI. At times we feel as disheartened as you … but
we see no alternative but to work within the constraints of the administrative process
that typifies local government.
There is something
that all community members can do whether or not they want a pool or not: exercise that traditional Aussie sense of
fair play. Let be explain the issue I’d
like you to judge.
When, at the end
of January this year, the council administration finally gave its verdict on
the Consultant’s Report (signed off in April 2011) it advised Councilors that
the proposed Denmark aquatic facility would cost $1.2M annually to operate. This total was made up of $432k for actual net
day-to-day operating costs, $462k to service the required loan, and $308k to cover
the eventual replacement cost (dressed up as depreciation allowance). In other words, ratepayers would be required
to pay $770k each year in finance and depreciation before even opening the
doors. It would be buying two pools: one for now – one for later.
As explained in
previous articles, DACCI’s Plan A calls for $214k net operating cost
plus $83k to service the loan - a subsidy
total of $297k annually. It follows
normal business practice of treating depreciation as a cashless entity. In other words, DACCI’s plan includes a
replacement (depreciation) cost of $0: it is concerned with just one pool, not two.
The question of
replacement is for future ratepayers. In
25 years time the pool will be paid for. At that time ratepayers may be asked whether
they’d like to have the mortgage payments returned to them each year (reducing
the annual subsidy to $214k) or perhaps be used to build a replacement reserve.
It has been
suggested that whoever dreamt up the idea of buying two pools not one was
clearly determined to sink both. That’s
as may be. But there’s a matter of
principle here for everyone to think about.
Which approach seems fairer to you?
Let your Councilor
know.
No comments:
Post a Comment