Town hall restoration on hold
The city council's uncertain financial position has led it to put the brakes on its multimillion-dollar project to restore the Christchurch's Town Hall.
The council was supposed to have begun seeking expressions of interest (EOIs) from companies keen to be involved in the $127.5 million restoration project in May, but it has put that process on hold.
The council's chief financial officer, Peter Gudsell, said the EOI had not started because the council needed more time to consider its financial position.
The official line from council finance committee chairman Cr Raf Manji is that "it's just on hold for a bit whilst we progress the insurance process", but The Press understands some within the council are pushing for the project to be reconsidered in light of the big financial shortfall the council is facing.
The town hall was insured for $69.1m but the cost of repairing it has been calculated at $127.5m. The previous council committed to spending that money, but since then an independent audit of the council's finances by corporate recovery specialists KordaMentha has revealed it faces a cost overrun of $534m, which could balloon out further if it fails to secure $1 billion in insurance payouts.
Included in that $1b is some money for the town hall but it is unlikely the council will get the full sum the building was insured for.
Deputy Mayor Vicki Buck said yesterday the council was still "fully committed" to restoring the town hall, but Cr David East admitted it was a project that "sits there with a bit of an axe over its head periodically".
East said informal discussions had taken place around scaling back the project by removing the rebuilding of the badly damaged Limes Room from the equation, but as far as he was aware the project was progressing as originally planned.
Council facilities and infrastructure rebuild director David Adamson said the council was waiting until it had greater certainty about its insurance position before asking for expressions of interest from contractors for construction.
"The council has a responsibility to be prudent with ratepayers' money. Council is seeking further clarification on its insurance position before progressing the project further. This will hopefully provide a clearer picture of the financial commitment needed to restore the town hall," Adamson said.
Yesterday, Earthquake Recovery Minister Gerry Brownlee reiterated his view the council should walk away from the town hall, saying it was difficult to justify the expense of either repairing or rebuilding it when the city's ratepayers were already under so much financial pressure.
"I personally don't think the city can continue to tolerate or withstand the level of rate rises we have seen over the last few years continuing indefinitely. It just doesn't work," Brownlee said.
The town hall was "not an inexpensive fix" and if it was repaired it would be "quite an isolated facility".
It would be competing against the emerging new performing arts precinct which would have ample theatre space across several venues and the new convention centre, which would have an auditorium with seating for 2000.