Surf Coast aquatic centre: Shire Council to consider loans to address budget shortfall

The cost of the Surf Coast Shire’s aquatic centre project has seen an “unprecedented” increase, with the council set to consider taking on loans.

Surf Coast Shire chief executive Robyn Seymour (inset) said the projected market cost of the centre ballooned in just three months after it was put out for tender.

The cost of a multimillion-dollar pool destined for Torquay has seen “unprecedented” price increases, leading Surf Coast Shire to consider taking on loans.

The shire may borrow up to $6m, among other cost-cutting measures, to try and deliver the Surf Coast Aquatic and Health Centre (SCAHC) which was the centrepiece of its 2023-24 budget.

The centre, which went out for tender in December, will include a 25m indoor pool, along with a smaller pool, gym, allied health suites and program spaces.

The shire will not reveal the projected cost, due to commercial in-confidence, but so far more than $46.7m had been allocated to the project including over $36.6m from state and federal governments.

That money can only be spent on this project, and if the project were to fall through, the shire would not be able to fulfil the obligations in its funding agreements.

The shire has committed more than $10m – $7.85m of its own money and around $2.3m via interest earned on grant funding.

Surf Coast Shire chief executive Robyn Seymour said industry consultants had been guiding project planning, however building costs continued to rise beyond all expectations.

“Quantity surveyors assessed the project design in December 2023 and at that time determined the project cost would be in line with the project budget,” she said.

“When we went to market, the results came back significantly higher in the space of three months.”

At the shire’s June meeting on Tuesday, councillors will debate whether to take out new loans, along with other ways to reduce the market cost, including potential design changes.

The centre has already undergone several design changes since it was announced in 2021, with the size and location of the pool changing numerous times.

It is also not the first time a funding shortfall has opened up, with the shire redirecting more than $1m from cash reserves and other projects in April last year to the centre.

Councillor Gary Allen voted in favour of the budget transfers, as it was a way for the shire to avoid taking out new loans.

“I’m keen … that we don’t increase borrowing by a cent,” he said at the time.

The latest development comes after the shire had already received feedback on its draft budget for 2024-25, meaning it must be voted on separately.

Councillors will decide whether or not to endorse the 2024-25 budget in its current form, before opening discussions regarding the pool’s budget.

Following this, a new draft budget will be released for community engagement.

Ms Seymour said the shire needed a budget in place to start the financial year, so any additional changes after that needed to be considered “as a separate process”.

It’s understood any new loans would remain within the limits set by the council in its 10 year financial plan.

Originally published as Surf Coast aquatic centre: Shire Council to consider loans to address budget shortfall