Today's letter: Car park sale
I think that it is time to move on from discussing the intricacies of the voting process employed to sell the Don-Deveron street car park and turn to the question of why it was sold.
A deal involving The Southland Times collapsed and Calder Stewart flagged away its option, so why cash up a good little earner?
A copy of the financial analysis for selling versus keeping, used to convince half the councillors, would be a good starting point.
Enough has now been revealed about this transaction to cancel any remaining need for confidentiality so perhaps producing the details of this asset sale is now more than justified.
Car parking produced a $93,796 contribution to running the city last year. How much came from the Don-Deveron street park? We don't know but whatever it was now goes to Wilsons in Auckland.
I wonder if the rates they pay on the property are so much greater than the lost income.
I would be interested to know which account the $1m realised from the sale went into. If invested, the income could be a buffer against rate increases, whereas lodging it in the ICC Investment Property account incurs the risk of buying more empty buildings.
Placing it with Invercargill City Property Ltd, a subsidiary of Holdco, means any benefits would become absorbed into its accounts.
This whole travesty has done nothing to benefit the ratepayers, lower the rates or demonstrate the council's unity.
Invercargill City Council chief executive Richard King replies: For the year ended June 30, 2011, the return received from the Don-Deveron car park was $37,323, which is less than the investment return by having the proceeds from the sale invested.
In essence, the public off-street car parks are a public service rather than an income-generating asset to offset rates.
The proceeds from the sale are added to the Off-street Parking account.
A review is currently under way as part of the CBD upgrade to determine, based upon activity, where off-street car parking is needed the most, which can vary depending on the time of day. The intent is to use the money in off-street parking to provide additional off-street car parks wherever possible.
The Southland Times