Kempsey cinema: Councillors debate to reach final decision

Councillors voted that the $6 million Kempsey cinema project will proceed under the alternative Voluntary Planning Agreement (VPA) funding model.

This means council will not be entering into a Public Private Partnership – the subject of much controversy and the arrangement that was rejected by the Office of Local Government. 

The Voluntary Planning Agreement (VPA) will see council make a one-off financial contribution of $2 million to Gowings Bros for the cinema construction costs. A Federal Government grant of $2m will also be contributed and Gowings will also be investing more than $2m into the project.

Council’s $2m contribution will come from existing unrestricted reserve funding, which includes income generated through previous community and property asset sales.

The VPA agreement means council will not share in any profits generated from the Kempsey Cinema but will also avoid costs associated with maintenance, depreciation, renewal and any other costing risks tied to the project.

Once the draft VPA is completed, including the confirmation of public benefits, the document will be placed on public exhibition for a minimum of 28 days. Exhibition dates and the documents will be available from council’s website and advertised in the printed council notices. Members of the public will be invited to make submissions on the terms of the VPA.

During the council meeting, there were passionate arguments made from all councillors with some arguing that the money would be better invested elsewhere in the community and not on a cinema, while others called for the “handbrake nonsense” to stop. Meanwhile, Cr Bruce Morris argued that the community should be consulted first.

“I’m not convinced the cinema is going to bring all that was promised with regards to jobs, etc,” Cr Leo Hauville said.

“Some councillors seem to have a religious fervour over this project - yet look at the numbers - the number of jobs this project is going to create is 10.6 jobs. We don’t have to give $2m to make this happen off sheer ‘guesstimates’ of what the benefits may be - the benefits are overrated.

“Where was the council when Harveys went out of business? When Barsbys was closing down? We didn’t give a cent towards them. I call on my fellow councillors to rethink their position on this.”

Councillor Mark Baxter hit back: “Sure this project creates just 10.6 jobs but the point is that it will attract hundreds of people to the town. We’re talking about a multiplier effect by increasing infrastructure that is not there at the moment. You’re being very microscopic - you need to think about the big picture - Gowings and businesses like Gowings aren’t going to spend the millions if they’re not confident they're going to get a return. You’re not wasting money, you’re investing it.

Cr Anthony Patterson agreed, saying, “What we need to do as a council is move ahead. We’re not ‘gifting’ anyone here - we’re investing. Sure we have roads to repair but it’s part of our process - I want our town to progress - none of this handbrake nonsense. We need to get off our haunches and get going with this.”

However, Cr Anna Shields said she finds it hard to justify giving away the $2m.

“I was a fan of the cinema from the beginning but not under this new funding model. I find it hard to justify gifting $2m to a private company that doesn't need it when it could be used in so many other areas in our community.”

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Cr Dean Saul and Cr Morris called for a community consultation process before making a final decision on the project. Cr Morris said it was important to find out whether or not locals were in favour of granting the $2m to Gowings.

However, councillors argued that community consultation had already been conducted in the form of a survey distributed during earlier stages of the project, where 52 per cent of participants said they would make a donation towards the cinema construction.

Cr Morris’ proposal was unsuccessful and the final decision was made to proceed with the cinema project under the VPA funding model.