Coal Creek ultimatum
SOUTH Gippsland Shire Council has given a strong indication Coal Creek must change or face an uncertain future.
Despite deferring a decision on the future of the Korumburra community park and museum at last Wednesday’s meeting, council declared it can no longer afford to keep pumping up to $600,000 into the tourist attraction each year.
Council has spent an average of $561,000 on the park during each of the last four years.
Council has also increased visitor numbers from 11,000 a year in 2006 when it took over management of the park to 68,000.
The park is expected to make a loss of about $343,000 in the 2013-14 year and that deficit is expected to rise by 12 per cent a year, resulting in a forecast deficit of more than $952,000 by 2027-28.
At a time when council is under financial pressure, Cr Mohya Davies said council’s investment was “unsustainable” and many constituents in her Corner Inlet ward were not happy with council rate rises.
“Council needs to make some tough decisions,” she said.
Cr Davies questioned a council report that stated the economic impact of Coal Creek was $2.9 million.
“I understand Coal Creek is a treasure but I also know our community is divided on this,” she said.
Cr Don Hill echoed those concerns, saying “$600,000 is unsustainable”.
Mayor Cr Jim Fawcett also lacked hope.
“I am an optimist but 40 years of trial and error could turn you into a pessimist. We do not believe Coal Creek will get to cost neutrality. At sometime it will require significant capital investment by council or someone else,” he said.
“We have mucked around with Coal Creek for the last five or 10 years, either committing or not committing.”
Last Wednesday, council voted to defer a decision on adopting a strategic direction for Coal Creek in favour of referring the matter to the 2015-16 budget deliberations of council’s Financial Sustainability Committee.
The recommendation before council at the meeting called for investigation of the prospect of a school camp at the park and new shops, and the consideration of alternative governance of the park.
The recommendation also called for a further report outlining the business case for reopening the Black Diamond Mine by June 2015.
A council report stated Coal Creek would become closer to cost neutrality if a restaurant, sound and light show, and school camp were opened, buildings without heritage value removed and trees lopped to reduce maintenance.
Implementing these projects were among the options proposed to council, including closing the park and continuing as is.
But the report stated pursuing new projects was risky and required State Government funding.
Another report called for the Black Diamond Mine to be reopened and paid drivers to operate and maintain the diesel and steam locomotives. That document also recommended train rides be more expensive.
The report to council noted park visitors have few opportunities to spend money in the park and that profit was offset by building maintenance, gardens and staff costs.
The report estimated volunteer time equated to about $500,000 a year in equivalent salaries, and visits to Coal Creek generated $1.4 million a year to the local economy.
A report from accounting firm Pitcher Partners in 2010 found the cost of closing the park and returning the land to the State Government would be $2.44 million.
Coal Creek receives $21,000 a year from the Department of Education and Early Childhood Development.
Cr Andrew McEwen said Coal Creek was not just a Korumburra asset but an asset for the whole shire.
He said yield from visitors had dropped from $9 to $7 per person, and Coal Creek needed to regain that sum.
Cr Bob Newton said the park had run at a profit under former manager Hugh Hendry and said council needed more time to work through issues with the park’s costs.
Cr Nigel Hutchinson-Brooks said Coal Creek was close to securing museum status through Museums Victoria and, according to a council report, that could lead to free advertising.
He said Coal Creek could take museums at Port Welshpool and Foster “under its wings”.
He said the school camp idea had merit but more information was needed, including expressions of interest from camp operators from around Victoria.
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