The budget for the redevelopment of Timaru’s Theater Royal and the proposed heritage facility disappeared from publicly available council documents in July, as the costs were unraveled.
On September 9, the Timaru District Council released figures publicly showing that the cost of the project had increased from its original $23.8 million to somewhere between $38 million and $57 million.
The council has yet to respond to questions about when it was first notified of the multi-billion dollar blowout for the project, who knew about it, and whether councilors were aware of it.
However, a study of council documents shows that the council’s own reporting on the project’s financial status changed significantly in July.
* Theater Royal now costs at least $39.6 million, confirms MBIE
* Candidates for mayor of Timaru District disagree on what is best for balloon cost community projects
* Timaru District Council confirms outburst of costs Theater Royal
Regular Theater Royal “project updates”, which are included in the council’s agendas and reflect easily digestible updates prepared by council staff, contain much the same information from April 2020 through July 2022. The updates include information on an overview, progress report and provide an indicative timeline, project risks and project finances.
The April 2022 update, submitted at the May council meeting, says “the project’s combined total cost of capital was $29.3 million,” but added that it was “under review after expanding its scope as requested by the government.” council”.
Three months later, the cost of capital budget disappeared from the update altogether. The only reference to the project’s financial data in the July issue, issued to councilors, says “the project should be financed by loans, reserves and external financing”.
However, the July report warns of a disproportionate escalation in the construction market “which conservatively runs to 11% for fiscal years 21/22 and 22/22”.
On July 15, in response to a question from The Timaru Heraldthe council confirmed that the budget for the project remained at $29.3 million.
However, information provided by the Ministry of Business, Innovation and Employment shows estimated cost of the project at the end of June 2022 was $39.6 million.
The council has been when it provided the higher figure to the ministry and why it has not been shared with the public.
There was no update of the Theater Royal project in the agenda of the council’s infrastructure committee for its September 6 meeting. However, that agenda contained such documents for the Downlands and Te Moana water supply schemes, the Three Waters incentive program, the Road Renovation and Improvement Program, CPlay Playground, Timaru CityTown Program, Washdyke Network Improvement, Redruth Landfill Cell, and Southern Trust Events Center.
According to Diaries, information received by councilors in July, it appears that the project team had investigated “option 3” as recommended by the council in September 2021, looking at both the theater (including the back of the house) and the the options put forward by different stakeholders.
The report from Nicole Timney, the council’s “theatre director” and property services manager, said the “preliminary design phase is now complete and the contractor is currently working on pricing the remaining design and construction costs.”
Timney’s report has a timeline leading up to Sept. 6, with a “preliminary design presentation” for the project listed in the public excluded portion of the council meeting.
When it released its latest cost projections to the public, the council said the cost increase was due to the complexity of the project and local and global pressures in the construction industry.
Before September 6, there were preliminary draft reference group meetings from July 12-24, 2022; board meetings for project management from July 13 – August 10. The tender and tender committee and the standing committee meeting were both on 6 September.
The council has said councilors received the confirmed figures in their agendas five days before the September 6 meeting.
The regular updates also show that from March 2021 to July 2022, the troubled project has undergone several personnel changes in the role of project sponsor.
Former commercial and strategy group manager Donna Cross, now a lawyer in Christchurch, was in charge in March 2021, followed by former Recreation and Cultural Services Group Manager Symon Leggett in October and that had changed by February 2022 to Steve McKnight (Group Commercial and Strategy) and Erik Barnes (Acting Group Manager Recreation and Cultural Services) with Jason Rivett ( Acting Group Manager Commercial and Strategy) and Barnes in the position as of July 2022.
There was also a change in project managers, with RDT Pacific Ltd taking over from Rubix in late 2021.