Canned project grant may be lost

Capel Shire Council scrapped a $5 million project which had already received funding at a special council meeting on Friday after councillors decided the risk of going over budget was too great.

The council was requested to consider tender submissions for the construction of a youth and community facility as part of Stage 4 of the Capel Civic Precinct.

The officer recommendation was to accept the tender from BGC Construction for $5,214,579 with a total of $3.7 million contributed from Lotterywest, Royalties for Regions and the Building Better Regions Fund.

The tender was $288,085 over the shire’s budgeted contribution of $975,097.

According to the report, external funding providers expected stage 4 would proceed, as $6.2 million was allocated for stages 3, 3A and 4.

As per the agreement with the South West Development Commission and Commonwealth of Australia to complete all stages, the council may now face the risk of having to refund $1.36 million of the funding already spent on developing stage 3.

A special meeting was required to discuss the item after a vote on the recommendation at the ordinary meeting on Wednesday was deadlocked 4-4, as Cr Michael Southwell was absent.

Shire president Murray Scott used his casting vote to tip the balance in the favour of proceeding with the project, but as the agenda called for an absolute majority, the decision was considered invalid.

At the special meeting on Friday afternoon, the project was overwhelmingly defeated 6-1.

Cr Sebastian Schiano “passionately urged all councillors to support the recommendation” to accept the tender and said he viewed the biggest risks to be failing to provide a vital service to the community and potentially ending up more than $560,000 out of pocket if funding had to be returned.

Cr Schiano expressed his confidence in the council staff to undertake provisions to work proactively with the construction company awarded the tender to make “savings where possible”.

He said the “stars had aligned” with both the State and Federal Government coming on board with funding, as they considered it a “project of significance for our youth” and thought rejecting the project would leave council at the “mercy of grant providers”.

Cr Doug Kitchen said $288,085 was “not small change” in his opinion and was concerned the amount could potentially increase.

Cr Brian Hearne suggested “re-scoping” the project and re-approaching grant providers as he could not support the project in its “current form”, although he “hated to see a $5 million investment lost in the Shire”.

Cr Peter McCleary said the council had received a lot of “grief” over rate increases and said it needed to “have control over what we are doing”.

Cr Barry Bell said while council had “some obligations to youth” council should consider existing infrastructure after “taking a fair whack over the year about rate rises”.

“We are obligated to run this organisation as best we can with what we have got,” Cr Bell said.

As per the funding agreement, the project was required to be completed before November 1, 2019.