A bit more of a peek into the Pandora's box of the purchase of the Bowling Cub land
Now it is all starting to make sense why councillors have said "we had no choice" when asked why they bought the Batemans Bay Bowling Club for $2.73m in 2016. It turns out however that they did have a choice. The motion to buy the club was won by only one vote during a confidential session on April 26th 2018. For the record Brown, Innes, Schwartz and Burnside voted to purchase and Brice, Harding and Leslight voted against - Pollock was absent. Some background. In 2009, the Batemans Bay Bowling Club amalgamated with Club Catalina, in a bid to ensure its survival. By March 2013 the Batemans Bay Bowling Club were forced to close their doors following a review in early 2013 the Catalina Country Club executive identified an unsustainable decrease in the bowling club’s turnover. The three years had seen the club devalued by an estimated $6 million in greens buildings, poker machine licences and assets. Catalina's previous chief executive and board had told the bowling club membership that if the bowling club was ever to be sold off the Catalina Club would provide bowling greens. Following the sale this offer was withdrawn. At a Council meeting on 26th June 2012 Councillor Allan Brown advised that “there are business people in the Batemans Bay CBD who have had a visit from a campaigning Councillor who apparently has relayed to them when Council takes over the Batemans Bay Bowling Club and redevelops it a heated swimming pool will be part of the redevelopment plans. Councillor Allan Brown advised as far as he was aware the elected Councillors hadn’t discussed development plans or ideas for the Batemans Bay Bowling Club and asked Council staff to explain what had occurred to date with any discussions about the Batemans Bay Bowling Club Source Mayor Fergus Thomson advised there had been basic talks, nothing of any great depth. The Catalina Club wants to keep bowling in Batemans Bay and there will be ongoing discussions. At the Finance and Services Committee meeting of 12th March 2013 Pat Bill made a submission to Council “In 1949 a group of men met in the Batemans Bay School of Arts and formed a working committee with the intent of establishing a bowling club. Local Council provided a loan of 1,000 pounds ($2,000). Since then the Club has grown considerably from its meagre beginnings and now boasts a magnificent auditorium and four bowling greens. BUT in order to save the Club in 2009, we amalgamated with Catalina - that amalgamation has failed. Catalina took over our debt and we transferred $5.4m of assets plus almost $800k of poker machine entitlements; now we assume that Catalina will retain any profit from the sale and we, the bowlers, will be left with nothing.” Don Cooper, in his Public Forum address to Councillors on the same day offered the following: “It would appear that under the current management regime there has been a strategy by Club Catalina to wind back services and facilities to reduce trade at the Bowling Club in order to justify their desire to close the Club and sell off the premises. Club Catalina should not be profiting from the eviction of bowling members. “Club Catalina has no intention of providing bowling facilities now or in the future. Morally they should transfer the facility to Council for no more than the debt they took over at amalgamation. They need to sever their involvement with the Bowling Club premises and focus on the Country Club in order address dwindling membership, reduced trading income and large staff turnovers. Following those submissions Councillor Thomson moved that a briefing be held for councillors on possible ways forward before staff prepare a report to Council and that following the briefing, staff of Eurobodalla Shire Council prepare a report for Council outlining what opportunities exist, if any, for Council to play a role in the continuing future of bowling in Batemans Bay. Up until July 2016 the Bowling Club site was land that was in private ownership however there remained a clause on the land that had been gifted by Dr Mackay stipulating that, while the land was not classified as a Community reserve, as such, council was to ensure the land remained "for the purpose of community recreation". The Catalina Country Club allowably, under the clause, bought it, supposedly to carry on, but it is strongly suspected it was to offset its losses, hence it was gutted and various parts closed down: the auditorium, bar hours etc. The club at that point owed $1,100,000 and while they considered they had every prospect of being able to trade out of that debt as it was principally depreciation write-downs they accepted the generous offer of the Catalina Country Club who arrived to embrace the bowlers offering at one stage to build new greens at their Catalina Club in Batehaven. The Canberra Times 27 March 2013 reported Catalina's previous chief executive and board had wooed the bowlers and convinced them they could turn around the fortunes of the club, which has a membership of 260 men and women.They expected turnover to increase to about $1 million annually. If the worst-case scenario happened and they did have to sell the club, they would make greens on Catalina's golf course and everyone could continue bowling.A new board and chief executive had ignored that hand-shake agreement, and told the bowlers there was no room at the Catalina. The plan for the Catalina Club was to then sell the Bowling Club, but there was the clause from Dr Mackay’s gift that stipulated it was to remain community recreation. Prospective buyers got a sniff of this and backed away because what they had in mind was not "community recreation", and so the place was closed. We also know from the Catalina Country Club Ltd.2015 - 2016 Annual Report that the land is burdened by a riparian corridor that was highlighted as a contract killer. This corridor restricts development within 40 metres of the high water line and resulted in a 30 percent reduction in available land and that the Catalina Country Club was in negotiations with another possible purchaser. The annual report very clearly states "During these negotiations a riparian corridor was highlighted as a contract killer... The deal fell through...." We also know that the land is subject to the same potential inundations as Surfside and Hanging Rock it must therefore have the same building constraints applied. The land is adjacent to a creek and it has to go hand in hand that if Surfside has a flood inundation rule then the same rule applies on the other side of the Clyde and to this creek. We also know from experience that it will be very difficult to set solid foundations as they discovered in Stocklands Mall when it was being constructed. The Mayor has been saying publicly that the land is now worth considerably more than they paid however the figures she has quoted are in conflict with the commercial land values of the adjacent CBD and surely must be in review with the additional impact of a four lane bridge and highway by-pass at its door clearly limiting the market for prospective purchasers required to build a "Gateway" ediface satisfying Council's ideals of its look and amenity. There was only one way you could overturn that sticking point Dr Mackay clause. Council had to buy the property for community recreation purposes as allowed .... and then, within their own powers, change it to Operational. Once Operational they could then do what ever they liked. No one else could do this - only council - so at the end of the day "they had no choice" because they were in fact the only body able to buy the land and turn it around into a "Gateway" project that could include a range of non-community recreational facilities such as seniors housing and retail. From a PerfEx letter at that time: ‘The Bowling Club site is of such supreme significance to our community, that any real or perceived title change is treated with great suspicion, due to our lack of trust in Council, caused by actions already demonstrated by some of those involved. And this classification option seems to take it one step further away from community control. If not this current regime of Councillors, then a future regime would still have the ability to sell the land on a whim, should they desire. Being the only buyer capable of "turning the land around" and getting rid of the "community recreation" clause one might ask why Council payed $2.73m which happens to have been $1.2m above the valuation for the land (as per the valuation document below). It is known that there were strong comments made by Councillors of the day during their private debates in the lead up to buying the land in April 2016. The main objection was that it was considerably over priced and that a current valuation should be sought as they had no current valuation on the table. Note that the valuation below is for the valuing year July 1st 2016 with the valuation date of 22/9/2016 Had a valuation been in hand at April 26th 2016 when Council decided to by the land it would have been LESS than than the $1.55m shown on the document below. So why did Catherine Dale, General Manager of Eurobodalla Council, under delegated authority from Councillors pay MORE than $1.2m above the Sept 2016 valuation? It is clear that Council had no intention of continuing to keep the facility for "community recreation'" by their own admission with then Mayor Lindsay Brown saying on April 29th, 2016 “Purchasing this strategic site is a financially responsible investment into the future of Batemans Bay and the shire. There has been strong support for Council to purchase this site for some time and we have already heard a number of suggestions on what can be done with it...... an arts cultural cinema building, conference and event space, tourism accommodation, restaurant and cafes, seniors’ living" Council, having bought the land knew it had to move quickly to make the land Operational. Just six weeks later, in their July 12th, 2016 PSR16/026 CLASSIFICATION OF LAND AS OPERATIONAL - BATEMANS BAY report to classify it as Operational instead of Community Council stated: Operational classification will provide the certainty required to maintain private sector interest and involvement in the master planning and redevelopment of the precinct. A classification of community land would necessitate a Plan of Management that would need to categorise the land and be very specific about any leases or licences that could be granted on the site. A classification of community land would also place additional restrictions on the length of leases that could be granted and the procedures for granting longer term leases. That determination and the extent of that report indicates that there was a very clear intention by Council, at the time of purchase, that it was going to buy the land and then use its own mechanisms to over ride Dr Mackay's clause.
That brings us to today: Council are presently within their rights to lease the land to the RMS however it is pleasing to read that there is a proviso, should they then wish to sell, that Council assures the community that they will not lose tenure over any of the four titles of Bowling Club land, without comprehensive and transparent community engagement. $2 million in loan funds for the Batemans Bay Bowling Club site were from taken out from NSW Treasury Corporation (TCorp). From their website we learn that TCorp offers loan facilities to New South Wales local councils seeking funding for projects which make up part of their annual expenditure programmes. Loan facilities, at competitive rates, are available to local councils who are deemed Fit for the Future and satisfy TCorp’s credit criteria. Though the terms are considered Commercial in Confidence by Council based on the figures below are from a bank loan calculator. Borrow $2 million over 10 years and pay approx 3% and it will cost $317,000 in interest. It is understood that Council will be leasing the Bowling Club site to the RMS for $3000 per week giving a return of $150,000 per year. Council have already outlayed $60,000 in interest so with a lease period of 3 years the council stands to make a net gain of $450 - 317 - 60 = $73,000 with the bonus of having the Bowling Club building demolished and removed leaving it with a clear site to sell. The question will be will they recoup the $2,730,000 - $73,000 for the land? Not likely if it is adjacent to a town bypass and the unimproved value is only $1.55m. The story continues..... hopefully our councillors have jotted down a few questions to ask of staff and on Questions on Notice