Rudman's city: Mayor gets two cars, ratepayers a lemon

By BRIAN RUDMAN

Talk about bad timing. No sooner does Auckland Mayor Christine Fletcher take delivery of two brand-spanking-new, ratepayer-financed Volvo cars than councillors decide to throw more money at next January's Volvo Ocean Race stopover.

Politicians are falling over each other to deny any connection. But Volvo New Zealand general manager John Snaith is rather less constrained about the "good deal" he has struck.

He told my colleague Bernard Orsman: "The added benefit ... is that we got the Mayor of Auckland driving around in our car, not only promoting the Volvo Ocean Race but promoting the product."

Good for his product perhaps, but not so good for the mayor's reputation in an election year.

Every time she tootles past with her MAYOR number plate, we'll be reminded that in just two years, the budgeted ratepayer contribution to the stopover has gone from $500,000 to $1.5 million.

Putting the cars to one side for the moment, a little history: the Volvo is the successor to the famous Whitbread races, which first stopped in Auckland in 1977. These days, with round-the-world races two a penny, this pioneering event is running out of steam.

Next summer's race has only seven entrants and veteran competitor Grant Dalton suggested this week it could be the last.

"It's getting too complicated and too expensive and there are too many stopovers. Rich guys don't want to sail on their own boats in the Volvo, so it's hard to get sponsorship."

In Auckland, the stopover has been something of a financial lemon since the 1990 race. That's when the English brewer refused to pay for future stopovers. In 1994, the Auckland Chamber of Commerce jumped in to save the day and took a bath, losing about $1 million.

Auckland City took over in 1998 and spent $170,000 of ratepayers' money on a pared-down event.

In February 1999, Mayor Fletcher and her newly elected council fell for the old threat from the organisers to bypass Auckland. They agreed to commit $500,000 towards the $1.5 million, 2001 stopover.

It now emerges that this $1.5 million budget drawn up by city officials two years ago was bunkum. The real cost is said to be $3.75 million, of which ratepayers will have to pay up to $1.5 million.

Some of the costs left out of the 1999 budget are eye-opening.

It was assumed that the boats would use the Viaduct Basin for nothing. Not true. Everyone has their hands out.

Renting a haul-out space from one of the America's Cup syndicates will cost $200,000 for the month. Resource consents will cost another $80,000.

Ports of Auckland wants $74,000 rental on the Eastern Viaduct. America's Cup Village Ltd is demanding $42,000 in berthage fees while the yachts are tied up to the city-owned Te Wero Island.

Other costs just seem to be out of control. In 1992, $180,700 was budgeted for "communications." That's now $473,057 and includes the cost of helicopters and planes for visiting journalists.

There is a $380,848 blowout in "village" expenses for such things as a big screen, and an "arrival festival." Management expenses have soared from $170,000 to $503,960.

City officials argue that sponsorship and other income are also budgeted to rise.

But once more, you have to ask, is funding and underwriting such financially risky events a proper use of ratepayers' money?

Back to those luxury cars.

Last June, the city's finance committee refused an offer from Volvo to provide a top-model car for the mayor's use. It was to be at a special price to mark Auckland's involvement in the yacht race.

The finance committee said it was inappropriate to accept a car deal from a major sponsor. An annoyed Mrs Fletcher said she might have to buy a secondhand Volvo to show faith to her pledge to the car dealer "to do everything possible to bring Volvo to the fore."

The committee set price guidelines for a replacement for the mayoral Ford LTD and her self-drive car, and left the decision to Mrs Fletcher.

Her response was to take delivery, last month, of two Volvos - a $65,000, S90 Executive for official use and a self-drive $59,990 S40 2-litre turbo.

No one's saying what discount, if any, is involved. Looking at the cost of the stopover, let's hope it was a big one.