Business Victor Harbor takes the gloves off and wants financial answers from council

Business Victor Harbor executive officer Derek McIlroy and deputy chair Kirsten Pitman are concerned on the lack of communication from council.
Business Victor Harbor executive officer Derek McIlroy and deputy chair Kirsten Pitman are concerned on the lack of communication from council.

The business community and ratepayers are demanding answers on the spending habits of the Victor Harbor council.

Business Victor Harbor (BVH) has called for clarity and transparency on City of Victor Harbor's 2021/22 Annual Business Plan and Budget.

The City of Victor Harbor has just completed consultation on the plan and budget and are in the process of collating all feedback.

Chair of Business Victor Harbor Michael Schubert said BVH was driven by its mission to be the voice of the business community as a positive advocate for the future direction and opportunities for the South Coast region.

"The chamber actively works to safeguard and support private enterprise so it can thrive in our city and help to sustain and create ongoing employment and investment opportunities," Mr Schubert said.

"We support any activity undertaken by the City of Victor Harbor (CVH) that contributes to a sustainable, vibrant and diverse economic future for our region, but we are also charged with highlighting council activity that we believe may cause undue financial burden on current and future ratepayers and impact on the long-term sustainability of the City of Victor Harbor's financial position."

BVH has provided feedback to council on the City of Victor Harbor's 2021/22 Annual Business Plan and Budget, putting forward in a letter the concerns that both BVH members and the wider business community have on the quantum and timing of expenditure of several of the key projects outlined in the proposed plan.

"We are genuinely concerned that it lacks a clear linkage to an endorsed long-term financial plan for the City," Mr Schubert said.

"We question the overall direction and detail contained within the business plan which may highlight the future rate burden for rate payers and our ability to attract and generate private investment to our area."

At the June 28 council meeting elected members of the City of Victor Harbor voted to not adopt three key financial indicator targets which included Net Financial Liabilities Ratio - maximum of 100 per cent and Asset Renewal Funding Ratio - 90 per cent to 110 per cent to achieve a three year rolling target of 100 per cent.

Cr Tim Glazbrook said Victor Harbor does not want to be at this level of debt.

"The audit committee is shocked with the level of debt and a 100 per cent ratio is too high a risk," he said.

Cr Bryan Littlely said "we need more discussion so I can learn more".

Council's audit committee said 'council needed to clarify its appetite for borrowings and must consider the effect of potential rate increases'.

Some of the concerns raised by Business Victor Harbor on the 2021/22 Annual Business Plan and Budget include - details regarding how council plans to resolve car-parking issues within the city, in particular, the McKinlay Street site; The lack of action items that aim to create and support an Investment Attraction Strategy for the city, particularly given this is a key objective of the recently released 'CVH Economic Development Strategy 2020-2030'; The overall debt levels envisaged for funds expended for both capital and operational expenses that have the potential to drive debt up for CVH to levels that may not be sustainable in the long-term and how this debt is managed and measured under the council's key financial Indicators (as outlined in the plan).

City of Victor Harbor CEO Victoria MacKirdy.

City of Victor Harbor CEO Victoria MacKirdy.

City of Victor Harbor CEO Victoria MacKirdy said the council's draft 2021/22 Annual Business Plan and Budget was out for public feedback from May 31, until June 21 and during this period submissions were received from a number of community members.

"Following the close of the consultation last week, council is collating all the feedback to be considered by elected members at a workshop on July 5," Ms MacKirdy said.

"Following this, a formal response will be provided to all community members who provided written submissions, including Business Victor Harbor. This is the standard approach for council's annual budgeting process.

"The council is really pleased to see Business Victor Harbor engaged in the annual budgeting process, as well as a number of other public consultation opportunities. We are proud to provide significant funding to Business Victor Harbor to enable this constructive dialogue and assist in building a strong chamber of commerce to work alongside council with our wider business community."

City of Victor Harbor are in dialogue with the Anchorage Hotel developers, who sought and obtained approvals for amendments to the initial plans for the re-development.

"The City of Victor Harbor has made a commitment to partner with the developers of the Anchorage Hotel and accommodate car parking required for the development on council land in McKinlay Street. This commitment remains unchanged," Ms MacKirdy said.

"While plans for the Anchorage Hotel re-development progress, the council has undertaken a national expression of interest that explores potential private sector partnerships for the McKinlay Street site.

"This process does not impact the Anchorage Hotel redevelopment progressing. In fact, council clearly mandated that any proposed development for the whole site must support the parking needs of the Anchorage Hotel development."

Ms MacKirdy said the expression of interest also aligned with feedback received from the community around the preference for developers to contribute to the cost of facilities that provide car parking rather than ratepayers.

"The proposals received through the expression of interest process will be presented to council for consideration and future direction with a commitment to align with the project delivery ambitions of the Anchorage Hotel redevelopment," Ms MacKirdy said.

BVH Deputy Chair Kirsten Pitman said Business Victor Harbor was not opposed to borrowing for public infrastructure and see that it would be necessary in most cases to ensure the ongoing viability and future of the city.

"However we have highlighted in our letter to council our concerns with some of the key projects outlined in their business plan and budget and whether the outlays for these projects are viable and sustainable.

"We also believe it is problematic to ask the ratepayer to review and provide feedback on a business plan or budget in isolation from a well-considered long-term financial plan," Ms Pitman said.

BVH have asked the council to provide clarity on the following projects listed in their 2021/22 Annual Business Plan; Community services; Community facilities; roads, footpaths and bridges, car parking and traffic management; open spaces and recreation, in particular, the Fleurieu Regional Aquatic Centre; Plant and Depot; business activity; public safety and Library and Cultural Services.

Business Victor Harbor has also raised concerns about a lack of direction and potential confusion by council around activities and projects that contribute to economic development.

"We recently wrote to the council highlighting the importance of the business community having input into how the council allocates the differential business rate," Michael Schubert said.

"We believe that the business community is best placed to understand what will drive economic development in the city," Michael said.

The chamber also made reference to its recently submitted responses to council on the proposed 'Arts & Culture Centre re-development' and the 'Differential Rating Review', which the association is still waiting on a response on.

"Business Victor Harbor always appreciates the opportunity to provide feedback to the City of Victor Harbor on behalf of its members and the wider business community on council projects, initiatives and activities that impact on the region's economic development and environment," Mr Schubert said.

Ms MacKirdy said council collected differential rates on commercial and industrial properties at 30 per cent and 15 per cent above the base rate (residential) respectively.

"The amount above the base rate is used proportionally to support projects and initiatives that are consistent with the intent of the City of Victor Harbor's Economic Development Strategy 2020-2030, a document which Business Victor Harbor and the local business community were widely engaged as a part of its development," she said.

"It should also be noted that the council's investment in economic development extends beyond the funds collected through the economic development differential."

To read Business Victor Harbor's full submission to council on the CVH 2021/22 Annual Business Plan and Budget visit their website at businessvictorharbor.com.au.

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