The Whakatāne District Council has approved the additional funding required to allow the redevelopment of the Whakatāne Museum and Research Centre to proceed in early-2017.
A $1.5 million grant towards the redevelopment project was confirmed by the Ministry of Arts, Culture and Heritage last month, matching the funding already set aside in the Council’s 2015-25 Long Term Plan. The Council commitment was made up of $1.25 million sourced from the proceeds of last year’s pensioner housing sale, plus $250,000 from Museum renewal funding reserves. Further grants have also been provided by the Lotteries Commission, Eastern Bay Energy Trust and the former Whakatāne Community Board, taking the confirmed project funding to date to more than $3.5 million.
Reporting to the Council last week, Community Services Manager Paula Chapman said the original $4.5 million budget for the redevelopment had been based on a quantity surveyor's estimate in mid-2014. Following detailed design, consent processes and an updated surveyor's estimate, based on 2017 costs, the project was now expected to cost $5.07 million.
"The cost increase of $570,000 results from construction escalation, additional seismic strengthening, the need to raise the floor level to guard against flood risks, and additional work to address ground conditions and meet consent requirements," Ms Chapman said. "We also anticipate a fund-raising gap of $330,000 on the original estimate, taking the project shortfall to $900,000."
She noted that the Ministry of Arts, Culture and Heritage grant conditions required that construction work start in 2017 and outlined two potential financial options to allow that timeframe to be met. Council elected members unanimously adopted a resolution to utilise interest accrued from the proceeds of the pensioner housing sale to cover more than half of the funding shortfall, with the balance of $410,000 to be loan-funded, with principal and interest repayments to be met from rates. That equated to a rate rise of 0.1 percent from 2018/19 onwards.
Speaking in favour of that approach, Councillor Scott Jarrett said the Museum redevelopment was seen by the community as an appropriate use of the pensioner housing proceeds. "This proposal is consistent with the community’s view at the time the pensioner units were sold and I believe it is an appropriate way to deal with the funding shortfall," he said.
The Council will seek expressions of interest in January 2017, in preparation for a construction tender process in March. Physical works are expected to begin in mid-2017 and be completed by mid-2018.