MOUNT Gambier City Council will fund the shortfall for the Community and Recreation Hub through loans and savings in a bid to secure the $25m contribution earmarked by the state and federal governments.
Elected members unanimously endorsed the full business case submission with a proposed council contribution of $13.7m for capital works – up from the initial $9.1m estimate – at a special council meeting held on Wednesday evening.
Council was left with a $5m question mark over the proposed capital works funding after State Government pledged $10m to the project.
Grant District Council have pledged $350,000 towards the development costs, bringing the shortfall down to $4.6m.
According to a staff report, a proposed funding breakdown includes council securing a $7.6m loan and an estimated $4.7m in cash reserves by 2021.
The proposed funding model earmarks a further $1.4m for infrastructure spending, highlighting “ground works in preparation for construction”.
Deputy Mayor Sonya Mezinec said although the in principle funding was less than initially projected, council was in a “strong financial position to move forward and consider how to bridge the funding gap”.
Ms Mezinec, who chaired the meeting in the absence of Mayor Lynette Martin, said council’s current loan borrowings sat around $2.6m for the library.
“Securing a total of $25m in Federal and State Government funding in principle is a huge achievement,” she said.
“Council always intended on contributing $9.1m to the capital cost of the project, but with an additional $5m deficit following less grant funding than expected, around $7.6m could be borrowed through the Local Government Finance Authority which provides loans specifically for major projects such as these.
“The interest rates for these loans are extremely low at about 3.6pc.”
The staff report said there were no other major capital works proposed in the near future which would allow council accumulate cash reserves.
According to council, they remain committed to maintaining rate increased at 4.5pc and not increasing rates to fund the project.
Speaking in support of the motion, councillor Frank Morello said the project was “as much about symbolism as it is about development”.
He said the majority community support for the project “despite social media vitriol and negative media commentary” demonstrated “the majority of people would rather be positive”.
“As a community, we have experienced the damage caused by negativity – the forward sale of our forests fuelled a massive loss of confidence, the repercussions of which were felt for many years.
“It was terrible.
“People lost their jobs, businesses closed, housing values plummeted.”
“We often talk about resilient, strong, robust communities that have the fortitude to plough through difficult times and be receptive to new ideas.
“Here we are tonight, on the cusp of a watershed moment, a turning point for Mount Gambier – a resilient city that’s weathered the storm and wants to embrace a positive future.”
No other councillors in attendance, which included Crs Kate Amoroso, Max Bruins, Christian Greco or Paul Jenner commented on the motion, but all voted in support of endorsing the business plan.
Mayor Martin, Sport and Recreation Centre Committee presiding member Cr Ben Hood and Cr Steve Perryman were apologies.
The business case was lodged with the Federal Government on Thursday to meet today’s deadline.
