Council has underestimated the cost to run Springwood’s new multi-million dollar community and cultural centre, forecast to open in February.
According to a report prepared for last night’s council meeting, an initial budget of $150,000 was provided for the first five months of the centre’s operation.
But the report revealed “planning work to date is projecting that this new facility will require a larger budget for the management and operation of the new facility”.
Instead of $150,000 the operating cost to June 30, 2015 is now expected to be $200,000, while the forecasted cost for the 2015-16 financial year is $400,000.
The report said that will “mean a projected budget shortfall of $50,000 in 2014-15 and $200,000 from 2015-16 per annum” and confirmed “a separate report will be provided to council [with] options for addressing any budget shortfall”.
A council spokesperson told the Gazette the operating cost for the new facility will be higher “because it will provide a higher level of service to the community” compared to the previous centre.
Blue Mountains mayor Mark Greenhill said councillors are constantly kept informed of the progress of the project and the next briefing would be held in early May, with a report to follow at the council meeting on May 27.
“I am confident council can continue to manage its budget responsibly, factoring in the ongoing management and operating costs of (Springwood’s) community and cultural facility,” he said.
Meanwhile, councillors were last night due to approve putting on public exhibition (from May 1 to 28) a raft of proposals including budget estimates, fees and charges.
They were also due to consider withdrawing or deferring up to six projects in 2014-15 worth a total of $1 million to put in reserve for “renewal of high risk assets, high risk asset failures and key community priorities to be implemented in 2015-16”.
Projects recommended to be scrapped — at least for 2014-15 — include a boardwalk around Wentworth Falls Lake, a footpath at Railway Parade in Woodford, a new car park at the Mid Mountains Community Centre and refurbishment of the Lawson Rural Fire Service building.
The report said the withdrawal of the projects “at this time is not a reflection of their merit, rather a prudent response given existing financial challenges.
And the fact that the outcome of the proposed Special Variation (rates increase application) process in 2014-15 is unknown”.
The report noted council had experienced several recent “significant unbudgeted asset failures” such as a landslip on Blaxland Road, storm damage to the Katoomba Aquatic and Leisure Centre and the flow on effect of the estimated $1 million cost of the October bushfires to council.
The budget estimate presents a balanced cash budget but an operating deficit (including depreciation and excluding capital grants) of $6.6 million.
The report noted council’s fees and charges for 2014-15 “have generally increased by 4 per cent, taking into account statutory requirements and the community’s ability to pay”.
