Splash Planet in Hastings has been closed since last year resulting in a big drop in council revenue. Photo / NZME
Splash Planet in Hastings has been closed since last year resulting in a big drop in council revenue. Photo / NZME
The Hastings District Council has posted a $7.2 million deficit during the first nine months of the current council year, which includes the impact of not opening Splash Planet.
A report into the council's financial position was prepared for its operations and monitoring committee on Tuesday afternoon.
It highlighted howthe council's spending and revenue are tracking compared to budgets and forecasts for the period between July 2021 and March 2022.
A concern highlighted in the report was a large shortfall in the amount of revenue which has come into council coffers.
The council is $13.7 million behind what was initially forecast in revenue for the nine months to March 31.
However, the council has also spent $6.5 million less than budgeted for the same period - meaning it has recorded an overall deficit of $7.2 million.
Splash Planet is among the council projects and facilities which have been disrupted by Covid and resulted in less than anticipated revenue.
Councillors made a tough decision last October to close the popular theme park for the summer season largely due to concerns about Covid spreading among children.
The council lost about $2.1 million in budgeted revenue as a result of Splash Planet not opening, the financial report stated.
However, the council also reduced its spending on the facility by not having to pay many of the operational and staffing costs.
Early estimates were the overall cost to the council would be almost $1.2 million to maintain the park while it was closed during 2021-22, instead of nearly $3 million if it opened.
An updated figure on how much it has cost the council has yet to be released.
Toitoi Hawke's Bay Arts and Events Centre also lost over $100,000 in revenue from cancelled and postponed events as well as related food and drink sales. Photo NZME
The council also saw a big drop in parking revenue, collecting just $1.3 million of its budgeted $1.8 million.
"Lower parking revenues are reflective of the impact of Covid-19 with pay and display metering not being collected during alert levels 4 and 3 [and] free parking prior to Christmas," the report read.
Toitoi Hawke's Bay Arts and Events Centre also lost over $100,000 in revenue from cancelled and postponed events as well as related food and drink sales.
The biggest impact to council revenue was a drop in grants and subsidies worth roughly $9.2 million, which were either delayed or reduced, according to the report.
The council's overall revenue for the nine months to March was $115.8 million instead of the budgeted $129.5 million.
Meanwhile, council spending overall was down on what was budgeted, with actual spending at $107.1 million instead of the budgeted $113.6 million.
A big chunk of that underspending (about $4 million) has to do with projects not running to expected time-frames and some costs being delayed.
Staffing shortages have also meant the council has saved $2.4 million in wages, although that has had a flow-on effect in slowing down council projects.
"Personnel costs are favourable to budget by $2.4 million due to a number of vacancies across council activities," the report read.
"This underspend in personnel cost is one of the many contributing factors in being able to start and complete initiatives and projects on time."
