Finances have improved so much in the last 12 months that Council hopes to retire a $100m emergency loan by the end of this year.
Council signed up for a $150m in two emergency loans in December 2020 when an administrator was appointed to replace the councillors after a cash flow crisis was announced in October.
Now, barely two years later, the Council, still under administration, is planning to pay out the $100m loan by the end of 2023.
CEO David Farmer told the December meeting of the Audit, Risk and Improvement Committee that unrestricted cash in the general fund was now quite substantial allowing money to be set aside to pay down the loans.
When the $100 million loan resets in December 2023, Council is planning to retire all of the $100m loan.
With the money put aside and “with some additional asset sales’’ he said council could potentially retire – pay off – what would be $82m outstanding at that time.
Mr Farmer said this would free up $7.5m in recurrent annual cash flow to redirect into the business.
Council will still have some of the emergency debt when the councillor elections are held in September 2024: the $50m loan will reset in December 2025.
The minutes don’t show how much the $50m should have reduced in the meantime.
The minutes state that Council is likely to borrow funds for upcoming major projects to provide intergenerational improvement – but not for everyday running of business.
The next phase is to not have to put cash into repaying debt, but directly to the needs of the organisation.
Since October 2020, council has reduced staff, restructured, sold -and continues to sell – assets and also received a big helping hand from ratepayers to help erase the debt.
Ratepayers have copped both general rate increases and ongoing water rate increases – above annual increases for inflation.
Council’s cash and investment portfolio totalled $707m at 30 November 2022.
In the first quarter of this financial year, operational income has increased by $16m to budget, due to increases in grants and income generated by things such as tipping fees and festivals including Chromefest and people using facilities such as pools.