Shire could add $6m to aquatic centre budget

THE Surf Coast Shire council has decided to press on with building the Surf Coast Aquatic and Health Centre (SCAHC) despite rising costs and could take on $6 million extra in debt to do so.

At tonight’s (Tuesday, June 25) council meeting, councillors went behind closed doors to consider and ultimately approve an agenda item about the tender for the centre, which could now cost up to $53 million.

After the meeting was re-opened to the public, a majority of councillors resolved to put the draft revised 2024-25 budget, which includes the new borrowings, on public exhibition.

According to the report presented to councillors about why that particular section of the meeting should be closed, officers stated the information on the centre’s tender “remains confidential due to commercial considerations”, including information that would “prejudice the council’s position in commercial negotiations”, “relates to trade secrets”, and would, if released, “unreasonably expose the business, commercial or financial undertaking to disadvantage”.

The officers’ report states construction of the SCAHC was put out to tender but “the market price is higher than the budget currently allocated” due to what the shire describes as “unprecedented” price increases over the space of three months.

Nearly $47 million has previously been committed towards building the centre: $20 million from the federal government, $16.6 million from the state government, $7.8 million from the shire itself, and $2.2 million in interest earned on the grant funding.

The shire aims to reduce the gap between the market price and the existing budget before any contract is awarded by value management, including design changes with minimal effect on the facility’s program offering, lifecycle costs or sustainable design credentials.

It is not clear what the final market price is for building SCAHC now as the tender discussion remains confidential, but it could be close to $53 million, given the new borrowings are a maximum figure.

The shire would borrow the $6 million for a term of 25 years, modelled at an interest rate of 5.25 per cent.

This would mean an annual cost of $432,000 in principal repayments and interest charges over the life of the borrowings.

Officers stated the shire’s loans and borrowings ratios would remain within the limits set by the council in the 10-Year Financial Plan and the shire’s Borrowings Policy.

Speaking at tonight’s meeting, Gr Gary Allen said he supported the motion but would be “very interested” to hear the community’s response to the draft revised 2024-25 budget.

“It is very difficult to ignore close to $37 million in Commonwealth and state grants… this opportunity is very unlikely to occur again.

“Plus with our projected population growth, it will be an asset well used.”

He said the funding model discussed value-added management, additional grants and philanthropic contributions, but these were not guaranteed.

“I also note the Torquay and district community, which will gain the greatest benefit, has made a zero contribution to the facility, unlike the Lorne community, for example, which was required – I’ll say again, required – to raise $350,000 for the Stribling Reserve Pavilion, and required to raise half the cost of the facade of the Lorne Historical Society.”

Cr Heather Wellington and Cr Paul Barker were the only two councillors to vote against the motion.

The SCAHC is proposed to include:

• An indoor 25m pool for lap/squad swimming and learn to swim lessons
• An indoor warm water pool for learn to swim, exercise, hydrotherapy and leisure
• Gym and programs spaces
• Allied health suites, and
• Café and supporting amenities.

Submissions on the draft revised 2024-25 budget will be open until July 22 at surfcoast.vic.gov.au/budget