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The new Orange sporting precinct cost $25 million. Then $35 million. You know where this is going...

September 1, 2022



By Peter Holmes


The cost to build the new sporting precinct, including a stadium, started out at $25 million.


On July 3, 2022, The Orange News Examiner revealed that the cost had blown out to $35 million, and that council had been forced to go cap in hand to the federal government seeking another $10 million.


What about as of September 1?

Well, nobody knows for sure.


All that is known is that even if the $10 million grant is successful, $35 million will no longer cover the build.


A report to the next the council meeting, on Tuesday (September 6), shows the Orange Regional Sports Precinct and Parklands "is facing cost escalations due to rising costs across the NSW building and construction sector".

A statement from council staff stated: "The last Quantity Surveyor’s (QS) estimate, received earlier this year, estimated the full project had increased to $35 million. This is above the $25 million NSW Government funding commitment provided in 2018.




"Costs have continued to rise since the last estimate was received, and particularly in regional economies. A new QS estimate will be completed to understand the impact of the ongoing cost escalation."

Orange mayor Jason Hamling said that "anyone trying to build a house right now knows how hard it is to face these industry-wide challenges. It’s the same with major infrastructure projects like the sports precinct".

Hamling said council was "not waiting for these problems to be solved while we get on with the work that we can do".


The project’s earthworks, worth $9 million, begin at the site in October.


Design work on the athletics track and stadium is "progressing".



Other sources of funding are being pursued to fatten out the budget.


"Orange City Council is working with the Department of Regional NSW to monitor and manage the costs of the project, identify any savings and identify any additional funding sources," the council staff statement said.


Preliminary cost estimates based on detailed designs are expected to be finalised in December 2022 to support any additional applications for funding.




“The project remains on track,” Hamling said. “Orange City Council will keep working with both levels of government to understand future funding options to meet the cost escalations.


"By this time next year, weather permitting, we’ll be watching the grass grow on our eight new sports fields.”


Former NSW premier Gladys Berejiklian announced the $25 million funding for the sporting precinct on Forest Road in February 2019 ahead of the state election.





She had initially said the money would only be forthcoming if the people of Orange turfed out Shooters, Fishers & Farmers MP Phil Donato and returned the seat to the Nationals.


However the backlash to such unreasonable terms and conditions was swift, and Berejiklian soon said the city could have the money no matter who it voted for. [Spoiler alert - the city took the money and re-elected Donato with a thumping majority.]

The coronavirus pandemic, natural disasters and the war in Ukraine have led to delays in shipping and shortages of materials, which in turn have jacked prices northwards while pushing back timelines and forcing projects to be delayed or cancelled.







Council was expected to find out in July if its application for the extra $10 million had been successful.


An increase from $25 million to $35 represented a 40 percent rise on the original funding.

Council applied for the $10 million grant in February.

If successful the $10 million grant would come from the $1.38 billion Building Better Regions Fund (BRRF) established by the former federal government.





The new Labor government has labelled the BRRF as a "slush fund" for the Coalition, and claimed it favoured National and Liberal seats over those held by Labor.



Supplied.



The Australian Financial Review reported in late July that "infrastructure minister Catherine King blamed former Nationals leader Barnaby Joyce for leaving behind 'a substantial mess' on grant allocations during the Coalition’s nine years in power, and has announced plans to redesign how regional funding is awarded under Labor".



The Australian National Audit Office examined the BRRF and looked at:


* Was the program well designed?


* Were appropriate funding recommendations provided?


* Were funding decisions informed by the advice provided and appropriately documented?


* Was the award of funding consistent with the program objectives and grant opportunity guidelines?


The auditor-general's report could not be filed under "glowing". It found that "65 percent of infrastructure project stream applications approved for funding were not those assessed as being the most meritorious in the departmental assessment process".

"Funding decisions were not appropriately informed by departmental advice, and the basis for the funding decisions has not been appropriately documented," it said.


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