Jangled nerves turned to loud applause as Whangārei District councillors voted in favour of progressing an $89 million conference centre, starting with investigations and design work.
The decision, at an extraordinary council meeting yesterday, means WDC will spend $1m of unbudgeted operational expense on investigations to better understand potential costs and will undertake public consultation.
The Government is giving $60m towards the Oruku Landing Conference and Events Centre on Riverside Dr while WDC had proposed to include $23m in its Long-Term Plan but pulled out after the Northland Regional Council reduced its funding, from $14m to $6m.
Ditching the project means losing $60m which Whangārei mayor Sheryl Mai said was "really enticing" but there were many unknowns about the project that needed to be clarified.
"We don't know what the final project cost will be and that's a position that none of us like to be in. That's a horrible place to be in for our ratepayers," she said prior to yesterday's vote.
However, she said every decision has a consequence in that any additional asset WDC built on behalf of its ratepayers came at a cost.
Mai said jobs were among the benefits of constructing a hotel and conference centre, as has been the case with building the Hundertwasser Art Centre, the new Whangarei Boys' High School, and other projects in and around the city.
She acknowledged potential rates rise as a result of putting council funding into the conference centre would be difficult for ratepayers.
A district-wide rates increase of 5.5 per cent, based on current project cost estimates and available funding, or an average increase of about 22.3 per cent if sourced solely from commercial ratepayers in central Whangārei, is a possibility under the option Councillors have chosen.
The highest increase from a commercial targeted rate would equate to more than $5300 per Separately Used or Inhabited Part of a rating unit (SUIP).
Northland Development Corporation is spearheading the hotel and conference centre development and director Barry Trass said the WDC decision was a step in the right direction.
"I felt very positive they were going to say yes because the town needs it. They're talking about other towns around the country that have them far smaller than Whangārei is.
"We've been talking about a theatre-cum-events centre for a long, long time but have never been able to get across the line and the reality is without that $60m from the Government, I'd struggle to ever think that the council or the community would be able to do on its own."
Councillors Gavin Benney, Carol Peters, Ken Couper, Jayne Golightly, Greg Innes, Phil Halse, and Vince Corurullo voted in favour of the council progressing to the next stage of the project.
Those against were Councillors Nicholas Connop, Tricia Cutforth, Greg Martin, Simon Reid, and Shelley Deeming.
Mai and Cr Anna Murphy abstained.
Speaking prior to the vote, Connop said while there was a need for a hotel and entertainment centre in Whangārei, the Covid situation threw up a lot of uncertainties and raised concern about a possible rates' rise particularly on small businesses and senior citizens.
Couper said the conference centre fitted the District Plan and provided a path for people to invest in the city.
"If we don't take the $60m from the Government, we'll all be left behind, per head of population. We now have that opportunity to secure that funding for our town."
Cutforth said ratepayers were understandably unclear about the benefits of a conference centre, in light of the amount of money being asked to put forward.
Investing money in this climate would throw up more costs and she believed the risks outweighed the benefits.
On balance, Peters said voting for the next stage provided an opportunity for the council to look at what costs could be saved, while Golightly highlighted the need to seek public feedback.
Innes was also of the view that further investigation around the many uncertainties was the next logical step.
"Everyone is frightened about rates going up but we need to have a good discussion with the community. We've got $60m from the government and really this motion takes us further in terms of information gathering."
Deeming said ratepayers were already struggling to pay for the hire of smaller venues like Forum North and Semenoff Stadium, let alone a bigger facility like the proposed conference centre.
"I am really struggling to see how the conference centre will provide the economic stimulus for the city. We have to face the fact that someone has got to pay," she said.
Martin said it was not be prudent to get involved into a project like this without doing a peer review in terms of costs, design, and consenting.
Halse said Whangārei had the third lowest residential rate in New Zealand and a very low debt level per capita.
The district has never had a 50 percent subsidy from the taxpayers for a project like the new conference centre which he said would add value to the existing amenities.
The conference centre forms part of the wider $220m Oruku Landing development on the 12,460sq m site, which would also include a four-star hotel and apartments.
The council accepts the conference and events centre will not provide a positive direct commercial return, however, it may be a catalyst for economic activity in the form of other developments.
The centre may help support other attractions and provide amenity and recreational value, WDC said.