Auckland Mayor Phil Goff is using special powers to take control of the $200 million to be spent on the Westgate-Massey North town centre project criticised by Auditor-General Lyn Provost.
Provost highlighted a lack of transparency, openness and governance at the project, which began under the former Waitakere City Council and has a commitment of $205 million of ratepayers' money.
In a report this week, Provost recommended Goff and councillors keep closer tabs on the project, saying Auckland Council could have made more information about the development available.
"In my view, the risks involved with this development warrant greater involvement by Auckland Council's governing body in overseeing this project, including costs," said Provost, who tabled her report in Parliament on Tuesday.
Goff said he was taking Provost's recommendations very seriously, saying after a long investigation into the project she did not find any malfeasance but things had caused her to raise questions about governance.
Goff said he would be using call-in powers as mayor to bring the issue to the governing body for oversight instead of it going to a council committee.
The discussions, involving commercial sensitivity and legal privilege, would be held behind closed doors, Goff said, and once negotiations were over details would be made public.
Provost said Waitakere council's 2009 budget for the project of $205 million was essentially the same in April 2015 but did not include work by Watercare Services or the council's contribution to relocating power lines.
In my view, the risks involved with this development warrant greater involvement by Auckland Council's governing body in overseeing this project, including costs
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The developer, New Zealand Retail Property Group, had paid about $3 million of $11.3 million owed to Auckland Council for its share as at last September, she said.
The report also outlined arrangements for postponing and offsetting some of the development contributions payable by New Zealand Retail Property.
"Auckland Council has taken on a greater risk at this stage in the project by the postponement of these payments," Provost said.
The project got strong backing from the former Waitakere City Council, which wanted a new town centre at Massey North. Just before it was wound up in 2010, the Waitakere council committed funding for road works and other costs, including a new library and public square.
"It is too early to definitively determine the extent to which Waitakere City Council's vision for the town centre will be achieved and the ultimate cost to be borne by ratepayers to achieve that," Provost said at the end of her report.