Extra $3 million flagged for offices

Former mayor, Jason Callanan, inspects loose wires inside the in-need-of-repair building. 153408

By Peter Douglas

Yarra Ranges Council will consider increasing funding for its Civic Centre redevelopment due to an unanticipated surge in cost projection of $3.6 million dollars.
At its Tuesday 27 March meeting, council voted for recommending an increase to the original $28 million budget, which was passed in December last year, citing escalating building costs and implementation of safety recommendations.
As a whole, council mostly supported the recommendation, although failed to win the support of Cr Fiona McAllister, who said she could not support a 12 per cent increase in allocated funds.
Yarra Ranges Council chief executive officer, Glenn Patterson, said the present economic landscape needed to be a consideration.
“A routine review of the project cost plan revealed that we had only allocated a 5 per cent construction contingency, instead of the industry standard of 10,” Mr Patterson said.
“As the designs were signed off on 19 months ago, and there are now more publicly funded works happening across the state, the price of construction has increased substantially.”
If approved, the additional funds will be taken from Council’s Asset Renewal Reserve funding, which is a standard approach for capital projects.
“This will not impact on the delivery of any of our capital works or our asset-renewal program, and will mean we won’t have to borrow as much money for the Civic Centre project,” Mr Patterson said.
Cr Tony Stevenson, who moved the motion, said, upon further investigation, council should find it reasonable that more funds are required.
“We’ve moved on from a conceptual design to a detailed design. Through that process … we’ve discovered things we would rather have discovered earlier,” Cr Stevenson said.
“It’s a hot market at the moment for construction. There is a lot of activity, a lot of capital works happening. Those are the types of things that are pushing the cost.”
Though, Cr Stevenson said there was some positive aspects, with council needing to borrow $4.1 million less than what was originally planned.
Cr Stevenson said this represented a drop in the loan amount from around 75% to 70%.
Despite the sentiment, Cr Fiona McAllister believed other options could’ve been explored.
“I fully support the need for the redevelopment … but, I think an increase of over 12 per cent in the project cost is something that I cannot support,” Cr McAllister said.
“I fully appreciate the circumstances in many of those instances that have led to unanticipated costs, but I still think that we have a set budget and should stick with that.”
Cr McAllister said the extra funds should be viewed in terms of how it could be used to help the community.
“Whilst I think in the scheme of things, $2 to $3 million doesn’t often sound like much, but I think about the bang for our buck we get from investing back into our community,” Cr McAllister said.
“I still believe in, and have huge faith in, the team running this project. And I have such faith that I believe they could run this project successfully without this additional money.
“The return on investment (for the offices) is substantial. The buildings around us are decaying … but I cannot support in excess of a 12 per cent increase in cost at this stage.”
Interestingly, concerns about a blow-out in cost were raised back in December last year, with Cr Tim Heenan flagging that possibility.
Cr Heenan also queried whether, with more people working from home in the future, and sharing office space, it was the best spend of ratepayers’ money.
“I just hope it will be value for money and the community space and office space will serve its purpose well into the future,” Cr Heenan said.

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