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White Elephant

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The East Gippsland Shire is proposing to build a breakwall, beach road and boat ramp (with a dredge) at Bastion Point, Mallacoota.

The overwhelming majority of stakeholders (87%) would prefer an upgrade at the existing site – not such a HUGE and costly White Elephant, which will cost ALL ratepayers

Without a single sod of soil being turned, it’s estimated this proposal has so far cost ratepayers over $1 million and taxpayers over $1 million… this is bad money management!

$2,000,000+ before work starts!

In 2005, Council said there would be ‘no financial implications for Council as a consequence of determining to proceed with the Environment Effects Statement’.  Since making that statement Council has spent over $1 million of ratepayers’ money – much of this to persist with and justify a proposal that an independent EES Inquiry Panel recommended against.

We have estimated Council and Government Expenditure as accurately as we can – see here. We would welcome any financial statements from Council and Government that account for the full costs of this project to date! To continue proceeding with Council’s proposal makes no sense – it throws good money after bad and will burden ratepayers for generations to come.

 

In 2009 construction costs were estimated at $3 million. By 2012 these had doubled – what will they be now?

$6,400,000 ++

Seven years ago Council stated that the development would cost just $1.7 million. Then four years ago they said it would cost $3.0 million. Now we are told it will be $6.4 million – why should we believe that cost increases will stop now?

 

 

 

 

 

 

The Government has closed the vault … any inflated construction, operating and maintenance costs will be from YOUR rates. Do you want to pay for this?

$$$ ???

The capital cost has increased four-fold since the Environment Effects Statement in 2005, and the operating costs have increased five-fold. The Government has capped the construction grant at $6.2 million. Any increased construction costs and all operating and maintenance costs will be met by ratepayers.

 

 

 

Ratepayers WILL incur $270,000 per year operating and maintenance costs!

That’s bucket-loads of money!

$270,000

The operating and maintenance expenses of the facility are estimated by the Department of Transport to be $270,000 per year. Ratepayers will be totally responsible for this cost, year in, year out, for decades to come.

There is little chance of this facility ever becoming self funding (the usual Council policy for marine facilities) as fees would need to be in the order of around $100 per launch, depending on the number of new boaters it attracts. Council has never explained why commercial users are not being charged for the capital and ongoing costs of this facility.

 

Asset depreciation will be around $200,000 per annum… kiss your footpaths and playgrounds goodbye!

$200,000+

Add to the annual operating and maintenance costs of $270,000 an average of $200,000 per annum asset depreciation. Council has confirmed that they will own this facility – they will thus be responsible for all operating and maintenance expenses. Asset depreciation is the long term replacement cost that should be factored into all Council expenditure on infrastructure. The Department of Transport uses an average 3% of capital cost to estimate long term yearly asset depreciation. Council may be able to obtain grants for this, but what other Council infrastructure will suffer…footpaths, playgrounds, libraries?

 

Burger Blowout Beggars Belief!

Council’s economic case relies on inflated figures and fast foods.

Council has ignored an independent Inquiry that found that this project had poor economic indicators with a negative net value, and a prediction that it could become a financial burden on ratepayers.

Instead, they have relied on a highly dubious report by a public relations firm that no longer has an economic consultancy section. Much of the data and assumptions in the report are questionable or unsupported, including the assumption that Mallacoota residents will spend an extra $112,000 annually on takeaway food if the development proceeds. Their calculations were not much better, as it was shown they had doubled all benefits in a calculation mistake.  But they did not alter it until after Council received a promise of $6.2 million in funding. Tourism benefits from boating that already occurs at Bastion Point were included – even though the independent Inquiry Panel had not accepted Council’s use of this double counting previously.

 

YOUR rates, taxes and capital works allocations – all for one user group – at the expense of many others …

That’s a HEAVY LOAD to bear!

Ratepayers are being locked in to paying millions of dollars over the next decades – pushing up your rates or reducing other services. Yet this facility has highly questionable financial returns, and is very unpopular with the local and tourism communities. Moreover, a lower impact and less costly alternative is possible.

Contact your Councillor and ask them to spend your money responsibly. A lower impact and less costly upgrade at Bastion Point makes more sense!