The tenant of a historical Rotorua building with an earthquake rating that plummeted from 95 per cent to just 15 per cent in nine years claims the council "ignored" calls for "urgent maintenance".
Rotorua Lakes Council says there is "no evidence" it carried out a geotechnical investigation of the ground underneath the building for seven years, despite it being required to verify the 95 per cent rating.
The council says it can't explain why due to "staffing changes".
On January 26 the building was closed following an Initial Seismic Assessment found the building to be earthquake prone at 15 per cent New Building Standard (NBS) – less than a quarter of the acceptable standard.
Tenant Blue Baths Establishment Limited (BBEL) - a catering and event company headed by Jo Romanes – was asked to vacate the building on that date.
The decision was also informed by a swarm of earthquakes in the region on January 25.
That was confirmed in April by a Detailed Seismic Assessment (DSA).
Assessments found extensive liquefaction of the ground below the building could happen in a significant event.
However, a 2012 Sigma Consultants earthquake assessment obtained by Local Democracy Reporting rated the building at 95 per cent NBS.
That report assumed the building was "on good ground" - an assumption that was not tested at the time.
The council has confirmed the four-page Sigma report was not a DSA.
On Thursday, council community wellbeing deputy chief executive Jocelyn Mikaere said confirmation of the condition of the ground under the building was an "essential prerequisite" for the rating in that report.
There was "no evidence" ground testing was done after the report was received.
"Staffing changes since 2012 mean we are unable to speak directly to decisions made about this at that time."
She said the council requested a DSA when BBEL wanted to revitalise the Blue Baths in 2019.
That was based on the council's experience with the Rotorua Museum and the Sir Howard Morrison Performing Arts Centre, she said.
A letter obtained by Local Democracy Reporting from Romanes' lawyer, Mark Copeland, to the council reveals claims Romanes raised urgent maintenance issues with the council including "leaking balconies, leaking pools and broken-down water pipes".
None of this maintenance was carried out and the council had "ignored" the Blue Baths' concerns, Copeland wrote.
The lack of "any material maintenance by [the] council" led to the company's reluctant decision to permanently close the Blue Baths pools in June 2020, he wrote.
Romanes told Local Democracy Reporting she believed the council's alleged failure to rectify those issues contributed to the worsened NBS rating between 2012 and 2021.
"For example, the oxidised concrete under the balconies - with exposed rusting reinforcing, and water dripping through - was there for even the public to see for years.
"Many of them commented on it when visiting the pools to swim. It's mentioned in the [DSA], and that's just in the places you can see, let alone under the building, where there was clearly water ponding there for years.
"Tradesmen hated working under the building, often having to don a wetsuit to combat the mud."
She said her company did a geotechnical report of the building, receiving it in February 2020 and sharing it with the council in October 2020.
"It is the state of the foundations that is the new issue.
"This is primarily what is driving the low [rating]. My team was not expecting the foundations to be in that state.
"The thought from my team of experts was that the ground, while probably not 'good', did not pose any new issues. The Blue Baths has always been sited on geothermal ground, and the building was designed to sit on top of it.
"Upon initial site assessment by my team, there was no reason to suspect that the ground had changed, or that the building was structurally vulnerable.
"We do not believe that the solution is that difficult, but it will take good design and several million dollars to resolve."
She described the relationship with the council as "strained".
In response to Romanes' comments, Mikaere said the health and safety of the community was a priority of the council's which it took very seriously.
The decision was not made lightly and it was the same approach as with the museum and the performing arts centre, she said.
"We continue to work with the leaseholder in good faith throughout this process."
Mikaere said the council had a "professional working relationship" with BBEL.
Lawyers trade barbs over Blue Baths
Legal letters flew between BBEL and the council between February and March this year.
Besides raising urgent maintenance issues, BBEL lawyer Mark Copeland addressed a number of concerns from his client.
He quoted the 2012 Sigma Consultants report's 95 per cent rating of the building, saying it was among "numerous concerns" in light of the closure.
His letter stated his client's issues over the council's communication over a proposed building revitalisation project and the seismic concerns as well as the council's ultimate decision to close the building on January 26.
"BBEL considers these actions … to be peremptory, unjustified, unconscionable and bad faith behaviour by the council."
On March 4, Tompkins Wake partner Kate Cornege - acting for the council - replied stating the "good ground" prerequisite of the 2012 Sigma report.
She said this meant the overall assessment needed updating and in June 2019 advised BBEL the council would do a full geotechnical and detailed seismic assessment.
"[The] council urged caution in proceeding with the redevelopment (including design)."
The tenant raised concerns the detailed seismic assessment was taking too long, holding up revitalisation work, Cornege's letter stated.
"In what [the] council understands was an attempt to expedite matters, BBEL advised it would be prepared to pay for a DSA to be completed."
The council would pay for a peer review of the result, Cornege said.
Cornege said a geotechnical assessment was not provided to the council until late 2020.
"Furthermore, the DSA was never completed, although [the] council was not advised."
The council received an Initial Seismic Assessment in late December, which advised the 15 per cent National Building Standard rating. A copy of that was provided to BBEL, Cornege wrote.
A swarm of earthquakes on January 25 also played a role in the council's decision to close the Blue Baths the next day at 5pm, with rental and operating costs also ceasing from that point.
"The decision to close the building was made with tenant and public safety as the primary concern," she wrote.
"[The] council was not prepared to entertain any risk of loss of life or injury should a catastrophic failure of the building occur. This was a reasonable decision," Cornege said.
The council offered alternative commercial kitchen facilities to Blue Baths on the understanding the venue was primarily used by the company for food preparation rather than as an events venue pending the redevelopment work it was exploring.
"BBEL did not accept the facilities offered."
Regarding the claim BBEL failed to produce a DSA, Romanes told Local Democracy Reporting she likely mistakenly referred to BBEL's geotechnical assessment as being a DSA.
She did not feel it was necessary nor BBEL's role to produce a DSA at that point as the revitalisation project was only a proposal, the Sigma report was "reasonably current" and did not signal any concerns besides the "good ground" prerequisite.
She had understood the increased capacity of the building would be what would trigger the necessity of a substantial seismic upgrade to the building "so this would be dealt with when designing began in earnest".
The council did not directly address Copeland's claims about the maintenance of the building in Cornege's response.
Council community wellbeing deputy chief executive Jocelyn Mikaere said the main factors for the NBS rating were highlighted in the DSA report, but said: "Moisture damage is sited [sic] in the DSA as a contributing factor, among many others".
The report listed 20 factors contributing to the rating and eight steps to retrofit the building to achieve 34 per cent NBS.
In late June, the council revealed the assessment and tests for the building had cost $84,618.
Council wanted to announce closure in February
Emails released to Local Democracy Reporting also revealed the council drafted a media statement around February 18 this year to announce the building closed while it underwent a detailed seismic assessment, and following an initial seismic assessment which had found the building at 15 per cent NBS.
In it, a quote attributed to then-council operations manager Jocelyn Mikaere stated the council had "no choice but to close its doors".
Romanes responded to the draft media release on February 23 saying she said she had sent a letter to Williams via her lawyer on February 12 "addressing concerns over Rotorua Lakes Council's handling of this current fiasco and its effect on my business".
"On that basis alone, I think it is completely inappropriate - and unnecessary - to send out something as potentially harmful as this statement to the public."
She said the council had "insisted on as close to immediate eviction as we could physically manage" and she took issue with a line in the release that suggested the council had helped find an alternate venue for BBEL's catering kitchen, saying it was "tokenism at best".
"The detailed seismic assessment, under your own timeline, is only days away ... so why would you put out something so damaging now, that could well be nullified in a few days' time?"
She said she had "real concerns" about the council's management "not being honest and transparent" with her business regarding a Request For Proposal process to do with the revitalisation of the building.
"The current farcical situation only adds weight to this perception."
She then quotes the drafted media release, which quotes Mikaere saying the council had "no choice" but to close the Blue Baths' doors.
"This statement is plain wrong [and] misleading," Romanes wrote in the email, quoting the EQStruc report back to the council which stated the building was not considered a life safety threat.
"These are important issues, not just to me but to all Rotorua ratepayers. The council management should be clear that they cannot quietly sweep them under the carpet. I / Blue Baths Establishment Limited will hold them to account."