Botched lease deal

THE Lismore City Council failed to follow proper procedure when it agreed to lease the art gallery cafe at below market rent, The Northern Star has discovered.

THE Lismore City Council failed to follow proper procedure when it agreed to lease the art gallery cafe at below market rent, The Northern Star has discovered.

A spokesman for the NSW Crown Lands division of the Department of Primary Industries confirmed that the cafe sits partly on land owned by the Spinks Park Reserve Trust, and therefore requires ministerial approval before any lease is finalised.

“Any lease offered by the reserve trust must comply with the Crown Lands Act 1989, which requires the Minister for Primary Industries' consent to lease the Crown land,” the spokesman said.

“The trust must give grounds as to why market rental would not be applied to any lease submitted for consideration.

“No leases over this site have been submitted to date.”

Last week, a number of Lismore-based real estate agents told The Northern Star the terms of the gallery cafe lease – $5000 in the first year and $10,000 in the second and third – were “well below what you would expect as a landlord”.

Councillors Ekins, Battista and Clough are now proposing a rescission motion at the next council meeting.

They have also indicated they have a list of questions regarding the lease that they want answered.

When staff recommended the terms of the lease at the last month's council – after two previously failed tenders, including the rejection of a $19,500 from the then-tenants – councillors were not informed of the implications of the cafe sitting partly on trust land, other than that two leases would be required.

Instead, it delegated outgoing general manager Paul O'Sullivan to “finalise” the lease.

This is not the first time council staff have failed to provide complete information to councillors on which they base their decisions.

Last month, senior staff were forced to admit misleading councillors over a proposed land swap with a private company to repair the city's CBD flood levee after the mistake was revealed by The Northern Star.

It is also understood the Department of Primary Industries has become frustrated with the council over its failure to develop the required plan of management for Spinks Park which has been outstanding for some 15 years.

Due to the late nature of this story, it was not possible to contact Lismore council for comment yesterday. It will be provided with that opportunity today.

Originally published as Botched lease deal