Central Coast Council on track to sell $60m in asset sales

It’s been one year since the doors were almost closed on Central Coast Council – now there’s a timeline for when it will finally be solvent again.

Central Coast Council has plans to be solvent and trading profitably by the end of the financial year.

On the one year anniversary of the week in 2020 when Administrator Rik Hart considered closing the doors on the embattled council, he says things are looking great for the new year.

The council has now reached its target of $60m in asset sales, with more than $34m now settled, to help it’s way out of the financial crisis and pay off its $200m in unlawfully used restricted funds.

“We have got contracts just a touch over $60m,” Mr Hart told the Express. “We are pretty confident we will get the balance.”

Administrator Rik Hart says things are looking good.

He said proceeds for the looming sale of the Gosford council building to Landcom will be on top of the $60m sales program.

“A sale sign will be going up on the Gosford building,” he said.

“That money will be used on top of the $60m to pay back the unlawfully used funds.

“We are doing really well. I am pretty confident that we will be positioned as fully solvent and trading profitably (by the end of the financial year)”.

However he said the ongoing financial recovery would heavily depend on the council’s two applicants with the Independent Pricing and Regulatory Tribunal (IPART) to increase water and sewer rates as well as extending the 15 per cent rate rise beyond three years. If the rate rise isn’t extended beyond June 2024, the council faces an annual income loss of $25.8m and will have to cut more services.

The old Gosford council building sale will help pay off council’s restricted fund debt. Picture: Sue Graham

“If those two applications are successful, it’s job done,” Mr Hart said.

“The organisation will be in total control of it’s own destiny.”

At last night’s meeting, council staff reported that more than $34.7 million assets have been sold and settled.

The latest sale is the land known as Warner Industrial Park, along Sparks Rd and Hue Hue Rd in Jilliby, which sold for $27m well over its valuation of $19.5m.

“We continue to demonstrate to the commercial lenders that we are able to pay back the emergency bank loans that had to be obtained to reimburse the restricted funds that had been spent unlawfully on projects that the community had benefited from,” Mr Hart said.

“Importantly, value has been delivered back to the community with the sale of properties to date achieving just over $10million above their market valuations.

Landcom and the State Government have announced plans to build a TAFE campus at the Gosford council site.

“Our financial recovery plan put in place in November last year is working and we are hitting all milestones and targets. Together with the cost reduction measures, tightened budget management controls, asset sales and a focus on productivity gains, we are doing everything we can to ensure the organisation’s financial sustainability.”

Mr Hart also voted to enter a memorandum of agreement (MOU) with Landcom and the State Government to buy the iconic Gosford council chambers on Mann St.

Landcom and the State Government recently announced plans to transform the site into a TAFE campus and housing.

Negotiations into the sale price continue.