Minutes (Open Portion)

Finance and Governance Committee Meeting

Page 2

20/10/2020

Minutes (Open Portion)

Finance and Governance Committee Meeting

Page 5

20/10/2020

THOMAS

The minutes of the Open Portion of the Finance and Governance Committee meeting held on Tuesday, 15 September 2020, be confirmed as an accurate record.

MOTION CARRIED

VOTING RECORD

6.1      2020 Meeting Schedule Proposed Changes

DEPUTY LORD MAYOR BURNET

That the recommendation contained in the memorandum of the General Manager of 15 October 2020, be adopted.

MOTION CARRIED

VOTING RECORD

COMMITTEE RESOLUTION:

That the following changes to the 2020 Council and Committee Meeting Schedule be adopted:

1.    An additional ordinary Council meeting be scheduled on Monday 7 December 2020.

2.    The City Planning Committee meeting scheduled to occur on Monday 7 December 2020 be moved to Monday 14 December 2020.

3.    The ordinary Council meeting scheduled to occur on Monday 14 December 2020 be moved to Thursday 17 December 2020.

6.2      Proposed 2021 Council and Committee Meeting Schedule and Temporary City Planning Committee Delegation

DEPUTY LORD MAYOR BURNET

That the recommendation contained in the report of the General Manager of 15 October 2020, be adopted.

MOTION CARRIED

VOTING RECORD

COMMITTEE RESOLUTION:

That:   1.    The Council adopt the 2021 Council and Council Committee meeting schedule, marked as Attachment A to item 6.2 of the Open Finance and Governance Committee agenda of 20 October 2020.

2.    In the event that any urgent matters arise which cannot be accommodated within the 2021 meeting schedule, special meetings be convened as required.

3.    The City Planning Committee be provided with the following delegation in order to facilitate the processing of planning permit applications during the Christmas period:

(i)      To determine all planning permit applications which would otherwise be determined by the Council, after the last ordinary scheduled Council meeting in December 2020 and the first ordinary scheduled Council meeting in January 2021, in circumstances where it would not otherwise be possible to determine the application within the statutory time period required under Sections 57(6), 57(6A), 58(2) or 58(2A) of the Land Use Planning and Approvals Act 1993, and an extension of time cannot be obtained, unless an Elected Member has requested the convening of a special meeting or meetings to determine the application and there is sufficient time to arrange a special meeting prior to the expiry of the statutory time period required under those sections.

6.3      City of Hobart Local Preference Procurement Policy

LORD MAYOR REYNOLDS

That the recommendation contained in the report of the Manager Rates, Procurement and Finance Operations of 15 October 2020, be adopted.

MOTION CARRIED

VOTING RECORD

COMMITTEE RESOLUTION:

That:  1.     The report ‘City of Hobart Local Preference Procurement Policy’ be received and noted.

2.    The Council adopt the City of Hobart Local Preference Procurement Policy, marked as Attachment A to item 6.3 of the Open Finance and Governance Committee agenda of 20 October 2020.

3.    The General Manager be authorised to finalise the City of Hobart Local Preference Procurement Policy and arrange for it to be made available from the City’s website. 

6.4      Annual Review of Investment Portfolio as at 30 September 2020

DEPUTY LORD MAYOR BURNET

That the recommendation contained in the report of the Manager Rates, Procurement and Finance Operations of 12 October 2020, be adopted.

MOTION CARRIED

VOTING RECORD

COMMITTEE RESOLUTION:

That the Finance and Governance Committee receive and note the information contained in the report titled “Annual Review of Investment Portfolio as at 30 September 2020”.

6.5      Lease Renewal - South Hobart Community Centre

THOMAS

That the recommendation contained in the report of the Manager Community and Culture and the Deputy General Manager of 15 October 2020, be adopted.

MOTION CARRIED

VOTING RECORD

COMMITTEE RESOLUTION:

That:  1.     The Council approve a new three (3) year lease to the South Hobart Progress Association for the South Hobart Community Centre, located at 42 D’Arcy Street, South Hobart.

2.    The leased area be provided at a nominal annual rent of fifty dollars ($50.00) per annum.

3.    The General Manager be authorised to finalise the terms and conditions of the lease.

4.    In accordance with the Council Policy ‘Grants and Benefits Disclosure’ the benefit recognised to the South Hobart Progress Association by way of reduced rental as part of the new lease be disclosed in the City of Hobart’s Annual Report.

7.1      Investigation of Asset Holdings

THOMAS

That the following Notice of Motion which was adopted by the Finance and Governance Committee at its meeting of 20 October 2020, be considered by the Council, as amended by the following:

1.     That the words be requested be deleted and substituted with provide a report with a proposal, including an estimation of costs to engage an external consultant to undertake and after the word Manager in Clause 1.

2.     That the words of better strategic use of, or be inserted after the word analysis in Clause 1.

3.     The addition of Clause 2 to read as follows:

2.    The following commercial attributes are to be addressed as part of the analysis:

a.     Current and potential use to value;

b.     Commercial value to commercial return;

c.      Rent return to capital return.”

MOTION CARRIED

VOTING RECORD

COMMITTEE RESOLUTION:

Motion:

 “That:   1.    The General Manager provide a report with a proposal, including an estimation of costs to engage an external consultant to undertake and complete an analysis of better strategic use of or possible asset sales and/or the potential to allow council assets of all types to provide support as collateral security to reduce debt levels without having to sell the assets for consideration by the Council when developing a post COVID-19 recovery and resilience plan.

2.      The following commercial attributes are to be addressed as part of the analysis:

a.     Current and potential use to value;

b.     Commercial value to commercial return;

c.      Rent return to capital return.”

Rationale:

During the COVID-19 pandemic, the Council experienced significant challenges to the financial sustainability of the Council. The forecast loss from all areas of operations in the financial year 2020 is estimated at a 12 million dollar loss.

It is important that as part of the ongoing strategies to recover from the pandemic that all realistic options are considered by the Council.  One of these ought to include:

1.      The consideration of disposing of the City’s underutilised assets.

2.      Consideration of the market mechanisms which provide possible flexible funding options for council’s balance sheet through utilising council’s asset portfolio to generate funding without selling or relinquishing control of the assets.

It is appreciated that this can be an issue approached with some trepidation by elected members which requires balancing the retention of required assets and possible unknown future circumstances against the benefits that disposal might provide in the ‘here and now’.

As an alternative to the disposal of assets, there may be options around restructuring the ownership model or using the assets portfolio to provide a better return for ratepayers.

For some years now governments around Australia including government owned corporations have entered into debt funding models which all require appropriate probity and transparency.

The assets portfolio encompasses all council owned infrastructure, including real property holdings.

The General Manager advises:

“A recovery and resilience plan is being developed as part of the City’s response to the COVID-19 pandemic, which will include consideration of the strategies for the future of the City’s assets.”

8.1      Committee Actions - Status Report

DEPUTY LORD MAYOR BURNET

That the information be received and noted.

MOTION CARRIED

VOTING RECORD

That the information be received and noted.

MOTION CARRIED

VOTING RECORD