North Sydney pool is already costing $91 million. Now ratepayers might need to chip in extra

North Sydney Council will consider hiking its rates to help fund the ballooning cost to rebuild its Olympic pool amid warnings the $91 million-plus project has pushed the council into a precarious financial position.

As construction forges ahead on the controversial redevelopment, the council says it will need to make “critical decisions” given the escalating price tag for the Milsons Point complex continues to put significant pressure on its budget.

The project, pictured this week, includes upgrades to the indoor and outdoor pools, a new grandstand, children’s water play area and expanded gym.Credit: Dion Georgopoulos

Mayor Zoe Baker said: “If we do nothing, our 10-year outlook is unsustainable.”

The project to overhaul the pool has been plagued by a litany of problems, including repeated cost blowouts, protracted delays, heritage concerns, legal stoushes and doubts over its scale and design.

The historic venue closed in February 2021 and work started in March. It was forecast to reopen in November 2022. However, construction work is not expected to be completed until early next year.

An October project update says the current value of the construction contract is $91.47 million.

A review by consultants PwC had predicted the pool would cost at least $89 million – $31 million more than the original estimate. Baker has previously said the final bill could reach $110 million.

Baker said staff would suggest a “range of options” to tackle the council’s financial woes in a draft community strategic plan and resourcing strategy to be released for public feedback later this year.

“I think all the options will include some kind of special rate variation. Every option is on the table.”

The council’s “state of North Sydney report”, published last week, said PwC’s independent review, which the council commissioned in 2022, highlighted decisions made in the initial planning phase of the project which left “high-level risks realised and unable to be fully mitigated”.

The famous pool opened on a prime slice of waterfront land next to the Harbour Bridge in 1936. Credit: Dion Georgopoulos

“The escalating costs associated with the project will continue to exert pressure on the council’s finances, leading to further reductions in cash reserves, increased borrowing and a decline in infrastructure renewals.

“Over the coming year, strong financial management will be essential, and the council will need to make critical decisions to improve its financial position and meet the community’s needs and expectations.”

Baker, who consistently raised concerns about the former council’s handling of the project, has previously warned the organisation faced a “difficult conversation” with ratepayers, given “poor planning decisions” meant the project was never going to meet its budget.

“We do have to have that conversation with the community; the reality now is the time.”

She said the community would have the opportunity to comment on the draft strategy before the council was required to apply for any special rates variation in February. Any increase, if approved by the Independent Pricing and Regulatory Tribunal, would probably come into effect next July.

The October update said a steel roof frame for the 25-metre indoor pool – which had to be pulled down due to a “significant” design and construction problem – had been reinstalled.

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