The top 10 highest earners for emergency housing in Rotorua. Photo / Andrew Warner
Two Rotorua motels earned more than $1 million in emergency housing funding in just one year, according to new figures obtained by the Rotorua Daily Post.
The figures, released by the Ministry of Social Development under the Official Information Act, show what each motel earned in emergency housing in 2020.
The Grand Treasure on Pukuatua St made the most with $1.45 million being paid by the ministry for emergency housing between January 1 and December 31 for 906 grants relating to 183 distinct clients.
The second-highest earner was the Spa Lodge on Amohau St which was paid $1.18m by the ministry for 765 grants for 165 distinct clients.
The Fenton Court Motel and the Kuirau Park Motor Lodge were also high up the list earning $943,848 and $910,695 respectively.
All moteliers spoken to by the Rotorua Daily Post Weekend defended what they earned, saying it was hard work housing high-needs guests and the ministry money saved the bulk of the industry from going bankrupt.
In the quarter ending December last year, $5.6 million was spent on emergency housing in Rotorua, a big jump on the previous three months. The figures for Rotorua were also a lot higher than any other area in the Bay of Plenty, including Tauranga.
No one from The Grand Treasure could be contacted for comment but Spa Lodge owner Emilyn Dubouzet said the motel put in the time and effort to care for the guests to get them back on their feet.
"It's not about business, business. If you give them respect, love and care, they do respond better."
Dubouzet said for that reason they worked hard for the money they earned.
"We need to take care of these people, not just grab the money."
Money had been spent on reinvesting in the property, ensuring cleanliness and refurbishing the rooms.
"We try to navigate them along the process because many do have emotional and mental issues. A lot of people are really against but let's have compassion for people. That's the way I look at it. It's unfortunate people are in this condition... It is just sad this should not be happening in the [developed world]."
Dubouzet praised the Government for spending money to care for humans, unlike other countries that leave them on the streets.
The Fenton Court Motel owner could not be reached for comment and the Kuirau Park Motor Lodge owner declined to comment.
The Union Victoria Motel owner, who did not want his name published, said the motel only had about six emergency housing clients this year as it was too hard last year. In 2020, that motel was paid $864,193 from 462 grants and 120 distinct clients.
He said a large amount of that money had just been paid in taxes and there "wasn't a lot left".
Cactus Jacks was paid $862,982 from 540 grants and 123 distinct clients, making it the sixth-highest earner in Rotorua. Manager Dan O'Connor said the money had allowed it to get a new roof, upgrade its geothermal facilities and employ security staff after hours.
"Did it come with its challenges? Absolutely. Was my family (who live on site) put in harm's way? Yes, they were."
However, O'Connor said the emergency housing clients weren't all trouble and he met some genuine people along the way whom he felt sorry for. He said they spent a lot of time and effort trying to help people into long-term accommodation.
The owner of Alpin Motel and Conference Centre, which made $779,367 last year from 606 grants and 183 distinct clients, declined to comment.
Bryce Smart, owner of Rotovegas Motel, which was the eighth-highest earner, getting $766,371 from 444 grants and 105 distinct clients, said he was grateful the Government had saved the motel industry in Rotorua.
He said the motel's cleaners, caretakers, suppliers, managers and other staff remained in jobs. He said the small number of motels that didn't take emergency housing clients were catering for the domestic visitors and surviving only because the rest of the motels were used by emergency housing.
He said he had been able to build new fences and reinvest in his property, again creating more jobs.
"The alternative was all of the motels would have been made bankrupt."
Another bleak outlook was if the motels had been turned into long-term rental accommodation, which would have looked like "slums", Smart said.
"At least with MSD, there's controls. If you muck around, you're out. It's harder to move on long-term tenants."
Owners of Geneva Motel and Manhattan Motel, which were the ninth and 10th-highest earners with $758,290 and $697,145 being paid to them, couldn't be reached for comment.
Rotorua MP Todd McClay said the amounts earned by some moteliers were, in his opinion, "appalling".
McClay said "dumping people in Rotorua motels is not a solution to anyone's problems".
"It's not fair to the local residents, it's not fair to the taxpayers and it's not fair to the people the Government is leaving to languish in those tiny rooms. What we need is an actual plan."
McClay, who hosted a public meeting last month on issues associated with the influx of emergency housing clients in the Glenholme area, said he was forming a working group with those who felt strongly at the meeting.
The group's first task was to have a meeting with police and address law and order.
One motelier, who spoke on condition of anonymity, called on the ministry to set a flat rate for all emergency housing to ensure the Government isn't being overcharged.
Waiariki MP Rawiri Waititi said the Rotorua Lakes Council and local iwi had been working together to come up with solutions and it was time central government stopped making decisions and instead resourced iwi and councils to find their own solutions.
"We are in a predicament because there are a limited number of houses being built and the ones that are being built are for the wrong end of town. There's nothing being built for the whānau in motels."
Ministry housing general manager Karen Hocking said the cost of emergency housing was set by the accommodation supplier based on the market rate for immediately available motel rooms.
She said this was influenced by a range of factors including supply and demand, the size of the household and in what region emergency accommodation was required.
She said the motels highlighted in Rotorua were significant suppliers of emergency accommodation, especially during the January to March 2020 quarter.
Hocking said both suppliers also offered additional facilities to store family possessions and both were near services.
"Our role is to implement government policy. Our responsibility in regards to housing is to ensure that people with no other option have somewhere safe to stay."
During a visit to Rotorua this week, Prime Minister Jacinda Ardern said the Government was not sending out-of-town homeless people to Rotorua to live in emergency housing.
She said she understood the city's problems, but suggestions the Government was purposely bringing homeless people to the city to stay in motels were wrong.
"If they are, it is certainly not through anything the Government is doing directly. We are not telling people to come here, we are not bussing people here. None of that is happening."
The existing Taradale Four Square would be demolished and rebuilt under the proposal.