‘Outstanding questions’: Council recommends referring itself to ICAC, police over land deal

A council is recommending referring its own dealings to police and corruption investigators after it bought a plot of land at an inflated price for a little-known company to build a controversial project.

The potential dual probe into the transaction between Murray River Council and Murray River Energy has been slated just weeks after the state’s council watchdog confirmed it would launch an investigation at the behest of Local Government Minister Shelley Hancock.

Moama farmer Guy Anderson next to the site of the proposed ethanol plant.Credit: Kate Geraghty

However, a report on which the council on the NSW-Victorian border will base its decision on whether to refer the Moama ethanol plant deal to the Independent Commission Against Corruption and NSW Police is likely to remain secret due to lawyers advising against its release.

“There is sufficient evidence ... of seriously important, outstanding questions to warrant referral to ICAC & NSW Police as authorities with the power to investigate thoroughly the MRE development, in particular the flow of [council] loan moneys to end beneficiaries,” published council papers say.

It follows revelations the council also gave a $900,000 loan to the company, more than half of which went to pay off a debt to neighbouring Edward River Council, where a similar development proposal has stagnated.

According to the council agenda, the process of securing the return of the funds will begin this month “and will be subject to legal processes”.

Questions have been raised over the price paid for the rural block.Credit: Kate Geraghty

The council bought the land, which was selected by Murray River Energy, from a local farmer in August 2018 for $1.2 million, $500,000 more than local valuations estimated the property to be worth. It then leased it back to him well below market rate.

Resident Kylie Berryman, who last year raised the alarm over the proposal for the $90 million project - labelled state significant because of its type, size and potential economic value - said it had been “incredibly hard” to get to the point where the council was considering passing the matter to law enforcement.

“This has always been about the responsible use of ratepayers money and due diligence by those entrusted with our funds. Unfortunately this still leaves us ratepayers with the overpriced $1.2 million dollar block of land that was purchased as a result of council’s actions,” she said.

Guy Anderson, who lives next door to the proposed development, previously said the price paid by the council was “exorbitant, ridiculous”.

The disused KFC registered as a shareholder address for a Murray River Energy director.Credit: Kate Geraghty

A council report said a valuation indicating an upper price of $1.25 million was provided by Ray White Rural, Deniliquin, but it had not been given in writing and the report did not say when the valuation was provided.

An agent said on Wednesday he hadn’t seen the council report but had acted for the seller in the transaction.

Last July the council obtained a written valuation that put the land’s worth between $790,000 and $1.13 million.

Murray River Energy is the latest iteration of companies linked by a similar group of directors that have proposed setting up ethanol plants or anaerobic digesters in Junee, near Wagga Wagga; near Geelong, in Victoria; and Longford, in Tasmania.

Those projects didn’t proceed due to a range of factors. The Herald has sought comment from Murray River Energy.

Murray MP Helen Dalton, who previously referred the council to the ICAC, welcomed the OLG investigation after it was confirmed in writing by the agency’s head Tim Hurst last month.

“The fact they are investigating [the] council’s handling of the Moama ethanol plant shows how serious the matter is,” Ms Dalton, from the Shooters, Fishers and Farmers Party, said.

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