Council in $500k spend up

A Wairarapa council with one of the highest rates rises in New Zealand is estimated to be spending more than half a million dollars on a holiday park.

Documents received from South Wairarapa District Council [SWDC] in response to a request for financial and other information under the Local Government Official Information and Meetings Act [LGOIMA] show the council has budgeted to spend $209,000 upgrading the Lake Ferry Holiday Park.

The upgrade costs are in addition to the more than $300,000 it is understood the council paid to acquire the assets of the park on June 30 and the $12,069.57 it previously confirmed it paid in legal fees for the deal.

SWDC has refused to confirm how much it paid for the park’s assets or how much it has borrowed to pay for it all.

Lake Ferry is a well-known holiday destination on South Wairarapa’s south coast that’s popular with fishermen and summer tourists from Wellington and further afield.

The figures come after SWDC voted to hike rates 19.8 per cent on June – steep rates hike that at the time were attributed in part to urgent work needed at the Martinborough wastewater treatment plant and other water-related upgrades.

SWDC also had the highest rates rise in New Zealand in 2021, at 29 per cent.

The council did not directly provide an answer to a query from the Times-Age regarding why it decided to buy a campsite.

“We are happy to meet with you to discuss this … SWDC already owned the land on which the park operates, and the purchase agreement is for the above and below ground assets,” the LGOIMA reply said.

The council also refused to say in the LGOIMA reply how much it had borrowed for the deal, or paid for the assets, although it confirmed the terms of the loan.

“The loan is for a 20-year term to reflect the average lifespan of the assets purchased, the interest rate is 5.76 per cent fixed for two years,”

The LGOIMA reply said SWDC expects the holiday park to run at a loss for the first two years, but the losses are not expected to impact rates because they will be ring fenced.

“SWDC has budgeted up to $209,000 to upgrade the park including fixing elements of the current campsite and fixed caravans that do not meet relevant legislative requirements. Like the purchase of the park assets, these upgrades are loan funded,” it said.

“Loan repayments are being met entirely from revenue from the park and will not impact rates. SWDC doesn’t expect that revenue will match loan repayments [principal and interest] for the first two years of operating the park following the purchase of the assets and our intention is to ring fence the deficits so that no additional rates are required to fund the purchase.”

SWDC consulted this year on costs in its annual plan, including spending on casual library staff and water upgrades, but did not consult on spending on the holiday park. Issues relating to the park were discussed by SWDC in at least one public-excluded session.

The LGOIMA reply confirmed a paper entitled “Lake Ferry Holiday Park” was considered by SWDC in a public-excluded meeting on August 24 last year.

SWDC issued a statement in July about the deal.

“The SWDC has assumed responsibility for meeting the capital costs of the changes necessary to bring the campsite up to standard. This will be loan funded with repayments and interest covered by the revenue from the park. Tourism Infrastructure Funding has also been applied for,” the statement said.

The LGOIMA reply confirmed SWDC has now received $60,000 in tourism infrastructure funding for the park’s ablution block, dump station, and rubbish collection centre.

SWDC has entered into a deal with campsite operator KiwiCamp to manage the campsite for 12 months from July.

SWDC had not granted the park a certificate of registration since 2019 because it said it did not comply with relevant regulations.

KiwiCamp was granted an exemption from the parts of the regulations that the park did not comply with and given a registration certificate to facilitate the work required.

“The SWDC and KiwiCamp are committed to creating a modern, welcoming, and family-friendly campground experience at Lake Ferry Holiday Park,” the council’s July statement said.

“With the combined efforts of both organisations, visitors can look forward to an exceptional stay at this picturesque coastal destination.” – NZLDR

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