Lismore council explains delay in flood payments

Lismore City Council will hand over more than $1.5m in charitable flood donations after an administrative oversight delayed payments to residents.

Lismore City Council has detailed how an administrative hiccup set back the payments of $1.5 million in charitable donations to flood affected residents.

Council retroactively authorised the distribution of the funds after failing to empower the committee in charge of the cash to hand out the money, acknowledging the “oversight” in a Mayoral Minute.

As of the August 9 council meeting, there was $1,589,252.43 sitting in the Lismore Flood Appeal coffers which has been accruing since around March.

Over the next two weeks, 1558 eligible applicants will receive a payment of $650 each in the first round of grants, totalling $1,012,700, with the remaining $500,000 held for a second round of grants in September.

Councillor Adam Guise argues the grants are too little too late.

“The reason we did this fund was to distribute the money quickly when people most needed it because other government services weren’t stepping up to the plate,” he told the Northern Star.

Lismore City councillor and North Lismore resident, Adam Guise. Picture: Cath Piltz

And with an additional $50,000 expected to come in from the One from the Heart concert and other sources, Mr Guise questioned the decision to hold off the second round until September.

“It was initially going to be $1000 straight and I thought if you’ve got 1.6 million in the account, you’ve got 1600 applicants - it was a clear cut case of just $1000 each, and that would have resolved all quite simply,” he said.

But Lismore mayor Steve Krieg said the decision to stretch the fund over two rounds was a safety net to catch people who couldn’t apply before grant applications closed on July 11.

“We wanted to have a bit of a backstop to make sure we caught everyone. So $650 the first round and there’s every chance that they’ll probably get up to around $350 in the second round,” Mr Krieg told the Northern Star.

Lismore mayor Steve Krieg talks to the press about the toll of delayed grants on the flood recovery, May 24, 2022. Picture: Tessa Flemming

The Flood Recovery Fund was established shortly after the February floods when grassroots fundraisers started sprouting up to support Lismore residents.

Fraudulent fundraisers also started to appear, prompting council to step in and weed out scammers.

“There's been a lot of fraudulent claims put in through Services NSW, so we just wanted to make sure that all of the claimants were legitimate,” Mr Krieg said.

Administration of the fund exceeded 200 hours of staff time - checking applicants were eligible and legitimate, with council documents revealing only four staff members were assigned to deal with the workload.

Mr Guise said council should have learned from the pitfalls in getting money to affected residents after the 2017 floods.

“In 2017 we had about 600-700 applications, and this time it has more than doubled to 1600 applications,” he said.

“This flood was way more impactful, you’re talking about 3000 uninhabitable homes.

“I think we just didn’t resource … the personnel sufficiently enough or take on the learnings from our previous flood fund experience to pre-emptively distribute the funds or put in place the processes required to do this properly.”

Mr Krieg said the process of getting the fund squared away with the Australian Taxation Office (ATO) also bogged down the distribution of the money.

“Because (the fund) was set up in such a hurry after the flood initially hit, we didn‘t comply with all the ATO regulations to be a tax deductible organisation,” he said.

“So we just had to make some administrative adjustments through the council meeting to make sure that all the correct procedures were followed so that anyone that donated to that flood appeal could claim tax, tax deductible status.”

No administration costs have been deducted from the funds raised, with all donated monies going to flood-affected residents, council said.

Of the 1805 applications, 233 were denied on the grounds that: The applicant was a landlord, or the address was not flood affected, or the applicant lived out of local government area, or it was a duplicate application or it wasn’t a residential address.

The Flood Appeal Committee consisted of councillors Bing, Gordon, Jensen, Rob, Cook, Guise and general manager John Walker.