Toowoomba council could hit borrow capacity with Qld Treasury of $300m over Cressbrook Dam spillway upgrade

The Toowoomba Regional Council could have to take on up to $300m of debt to pay for the impending Cressbrook Dam safety upgrades. Details here:

The Toowoomba Regional Council will be pushed to its “maximum borrowing capacity” with the Queensland Treasury Corporation if it can’t secure a state government bailout to help pay for the looming Cressbrook Dam safety upgrades.

Toowoomba mayor Geoff McDonald revealed debt drawdowns would be the “primary” way the council pays for the mandatory upgrades, which will cost at least $270m and must be completed by late next year.

It comes just weeks after Mr McDonald, who is running against just one other candidate for mayor in the current election, warned residents might have to cop large rate rises to help pay for Cressbrook.

The council is still trying to secure a grant from the state or federal governments to ease the impact on ratepayers, despite having known about the upgrades for years.

Aerial photograph of Lake Cressbrook. Photo Kevin Farmer / The Chronicle Helicopter services courtesy of Heliwest Group

According to his monthly mayoral report, Mr McDonald said the council was likely to hit its borrowing limit with the QTC, currently set at $300m.

“Council reached a consensus that this year, our advocacy focus to the Queensland Government would concentrate on the Cressbrook Dam Safety Improvement Project,” his report said.

“The estimated $270 million cost of the upgrades due to regulated safety upgrades will be a significant financial burden to the ratepayers of the Toowoomba region.

“Without grant support, the project will be primarily debt-funded by the Queensland Treasury Corporation.

“The debt drawdown will likely take council to its maximum borrowing capacity and negatively impact its financial sustainability.

“The next council must continue to advocate for financial support from the state and federal governments to alleviate the cost burden on Toowoomba region ratepayers.”

Mayor Geoff McDonald at the contract signing between the Toowoomba Regional Council, Seymour Whyte and SMEC Australia for the Cressbrook Dam safety upgrade project.

Mr McDonald was contacted for comment.

The council needs to spend another $40m over the next five months on Cressbrook to meet its revised budget goal of $45m in the current financial year.

While the TRC’s monthly financial performance statements projected the council should have spent $8.8m on the project by this point, the actual figure is half that amount ($4.3m).

It is understood expenditure on the upgrade will ramp up once construction starts.

The TRC in December signed an agreement with Seymour Whyte Constructions and SMEC Australia to design and build the project.