A BUDGET blowout at the Coffs Harbour Airport Enterprise Park project has angered local councillors who say they were not kept informed about the project’s rising costs.

A Council report stated that a number of issues had arisen and been managed by the Airport Enterprise Park (AEP) project team to progress the development in line with its tight timeframe for delivery under Federal and State Government grant agreements.

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“The most significant issues have been difficult ground conditions and the requirement for a large amount of additional fill material for road construction and the raising of lots to the required levels to facilitate appropriate drainage,” the report stated.

“It is acknowledged that given the large amount of additional bulk earthworks required, this potential for budget impact should have been made known to Councillors earlier.”

The budget cost increase is detailed as $5.6 million, with the project budget contribution from Council now forecast to be $10.5 million for the two initial stages.

A February 2021 update report on the project noted an estimated $5 million contribution from Council’s Sewer Fund, but the budget contribution will now need to remain at $10.5 million to enable the completion of the project.

Cr Sally Townley detailed her frustration over a lack of councillor information about the project’s development when the issue was discussed at a Council meeting on Thursday 14 October.

“Councillors have been asking ‘how is this budget tracking’, and I just think it’s an unreasonable position to put us in saying ‘this has happened, it is a big blowout and now we’re asking you retrospectively to approve it’,” Cr Townley stated.

Cr Townley said the estimated cost for the earthworks was $1.5m, and now was over $9m.

“Now that’s a massive, massive, massive lack of calculation, lack of scoping, lack of preparation,” Cr Townley stressed.

“I wish that councillors had been kept in the loop a lot more on this super important project, one of the biggest things that we’ve got going.

“So what are we going to do now, so that’s like $5m that we didn’t account for, are we going to pay ourselves back that money when in seven years time we start getting the money that comes from the lease sharing arrangements?”

Cr Paul Amos pondered over whether the Council was becoming a bit “number dead”.

“This is over budget,” Cr Amos stated.

“$5.6m is a lot of money to most councils, I wonder if we are getting a little number dead.”

A Council director present at the meeting agreed that “there should have been more analysis, and that would have brought out the issue with the earthworks”, which he stated led to a $4.2m overrun with the project budget.

The forecast end cost for the project is now over $30 million.

Mayor Denise Knight also expressed her frustration over a lack of information about the progression of the project.

“When I saw this on the business paper, we (the councillors) felt like we were between a rock and a hard place on this one, without having information leading up to this and then having to make a decision on the night,” Cr Knight stated.

“I accept the apology from the Director, but can we not let this happen again, please?

“If we could please have regular emails coming out to us just letting us know where we are up to, it would have been nice to have a lot more information coming to us.”

Cr George Cecato stated that there were circumstances that led the project to go over budget and that the final product would make the city proud.

“So did we go over budget, yes we did, would I have preferred being told earlier, yes I would have,” Cr Cecato said.

“I believe that yes we’ve gone over but there were circumstances to go over, but the quality of the final product is something that is going to make this city very proud for many, many years to come.

“It’s a great project, it’s for the future of this city, for employment, for the long term financial benefit of the Council.”

Councillors unanimously approved for Council to note that the best estimate for the forecast end cost of the project is $30,030,240, and note the expenditure of the $10.5 million budget contribution funded from the previously agreed Sewer Fund internal loan, which will be reflected in the September Quarterly Budget Review Statement.

Council will also approve an additional allocation of $670,324 for the relocation of Telstra assets from within
the airside boundary to be funded through the Airport Reserve.

The forecast end cost for the project is now $30,030,240 to be funded through:

• $10 million Federal Government grant (Regional Growth Fund)
• $10 million State Government (Restart NSW Fund)
• $10.5 million Council Internal Loan (Sewer Fund)

The AEP construction has been divided into three major works portions (Work Portion A (WPA), Work Portion B (WPB) and Work Portion C (WPC)) with WPA completed in early 2021.

WPB is currently under construction (90% complete and scheduled to be finished October 2021) and includes substantial lot filling, the construction of the new Hogbin Drive intersection, 26 fully serviced lots, road works, drainage and the reconstruction of Christmas Bells Road.

Tenders have recently closed for WPC, which includes 34 fully serviced lots and associated roadways and services.

With the acceptance of the tender for WPC, the project is on track to meet the completion date of April 2022 stipulated in the Federal and State grant agreements.

Progressing concurrently with the construction of the project, Council has also resolved to seek a rezoning of the AEP.

The rezoning application has been submitted and an independent assessment of the application is currently underway.

It is anticipated that the 43 hectare subdivision site will attract a mixture of business enterprises as well as new aviation related enterprises to the area, boosting employment for the long term and providing significant economic benefits to the Coffs Harbour region.

By Emma DARBIN