Sunshine Coast Council debt surpasses annual forecast by more than $20m

Forecasts for what Sunshine Coast Council’s debt would peak at this year have already been surpassed by more than $20m. Here’s why

Sunshine Coast Council’s debt level has blown out more than $20m above its forecast peak for the year within the first three months.

New financial data shows the council’s debt as of August 31 reached $657m despite Mayor Mark Jamieson revealing at the June budget discussions that it would peak this year at $634m.

A council spokesman said council renegotiated its loan terms to lock in a reduced interest rate and extend the repayment period.

“The new loan terms have provided council with more cash to invest in community infrastructure such as roads and streetscaping and in turn support the local economy and jobs at a time our community needs it most as we recover from the enduring impacts of COVID-19,” he said.

Sunshine Coast Council Mayor Mark Jamieson pictured in June after the council voted in support of the 2021-22 budget.

“Extending the repayment period has increased the overall debt, as reflected in council’s August financial report.”

He said council’s debt was forecast to reduce to $486m by June 2022, up from $483m as reported in June.

Slashing debt by almost a quarter hinged on a payment of $305 million from Palisade Investment Partners for the airport expansion project.

The final payment is expected to settle council’s outstanding debt relating to the runway extension works and provide a $31m windfall.

The spokesman said the new loan terms included an interest rate of 2.4 per cent, up from 2 per cent under the former agreement.

The August financial report also revealed $96m in new borrowings.

The spokesman said that was to fund capital works projects including the new Sunshine Coast City Hall, Nambour material recovery facility and a new multi-deck car park at Maroochydore CBD.