Manfeild at risk of red flag
As Manfeild Park Trust waits to hear if it will keep hosting the New Zealand Grand Prix, its financial situation has been laid bare and it is not looking pretty.
The accounts record a net cash surplus of just $57, a liquidity issue and the lowest gross income recorded in the past five years.
This is after the Manawatu District Council bought back 4 hectares of land for $5 million in 2012, which it had originally gifted to the Feilding-based trust. These funds were used to reduce bank debts and in turn reduce the amount of interest paid out by the trust.
Manfeild Park Trust chief executive Heather Verry and trustee Chris Kirk-Burnand presented the trust's latest report to the Manawatu District Council last week.
Mr Kirk-Burnand said all funds had been invested in the development of Manfeild, such as upgrading the track, fire systems and developing a truck park for equestrian events.
Councillor Barbara Cameron expressed concern about the "underlying huge financial risk for the council", which has a $2.95m loan to the trust, helping to pay for building the agri-events stadium.
Mrs Verry has said Manfeild is not concerned about the accounts showing their lowest gross income in five years.
"It is reflective of tough economic times. We are in the business of discretionary spend - motorsport. There has been a bit of a dip, but it is increasing, especially in the national scene."
Manfeild recently hosted the New Zealand Grand Prix, which attracted 7000 spectators over that weekend, down from an attendance of 12,645 in 2012.
The Feilding venue hopes to keep the NZGP but is up against a well-financed bid from Cromwell.
The Manawatu District Council dropped its operating grant from $250,000 to $150,000 last year and also pays a $168,000 annual access fee, which allows residents to use the front grass area of the park when events are not being held.
When questioned by Cr Cameron on the cost of salaries and the number of staff, Mrs Verry confirmed there were seven fulltime equivalent employees.
Annual reports to the Charities Commission show $10,000 is paid per week for salaries and wages. The annual figure has increased more than $110,000 compared with five years ago and trustee fees have nearly doubled from five years ago.
Mrs Verry said at the council meeting: "One of our key things is retaining the events we have. We look to sharpen the pencil a lot to retain them. We work with those struggling to make their event more successful." She gave an example of New Zealand Police using the track for driver training more.
The trust also has a loan of almost $3m from the Palmerston North City Council, though in 2010, after defaulting on repayments, it secured deals where it did not have to pay interest to the city and district councils for five years. Mrs Verry said at the time the council money would enable the complex to grow.
Manfeild is expected to have discussions with the councils soon regarding their financial support.