Agenda of Finance and Governance Committee

Georges River Council – Finance and Governance Committee - Monday, 11 February 2019 Page 4

Committee Reports

Item: FIN001-19 Advice on Costs and Status of Council's Court Proceedings - December 2018 and January 2019

Author: Director Legal Services and General Counsel

Directorate: Office of the General Manager

Matter Type: Committee Reports

Recommendation

That the report “Advice on Costs and Status of Council’s Court Proceedings – December 2018 and January 2019” be received and noted.

Executive Summary

1. Advice on Council’s Court proceedings for the period 24 November 2018 to 30 January 2019 is contained within this report.

2. Total costs to date for the 2018/19 financial year for Court proceedings are $738,508.

3. Total legal costs recovered to date for the 2018/19 financial year are $373,728.

4. Total nett costs are $364,780.

Background

5. The current Court Proceedings for the reporting period are broken down as follows:

Supreme Court

· 2 x Summons

Land and Environment Court

· 26 x Class 1 (Merit/DA)

· 5 x Class 4 proceedings (including 1 x Contempt of Court proceedings)

· 18 x Class 5 (Environmental Prosecutions) Summons’

Local Court

· 5 x Council Prosecutions

· 2 x Prosecutions (brought by NSW Police – concerning threats/assaults on staff)

Cost Recovery

· 5 x cost recovery matters

New Matters

6. There was one new Land and Environment Court Class 4 matter during this period commenced by Council (Goddard) and five new Class 1 matters (Thanos), (Adouni & Raad Pty Limited), (Best Build NSW Pty Ltd), (Futuristic Design Pty Ltd) and (Kasif).

Finalised matters

7. Ten matters were finalised – (Cash Warwick Pty Ltd), (Bonamici), (Owners SP63227), (Noumeir), (Dimovski), (Krimzis), (Xie), (Regent Land Pty Limited), (Palmerston Dragon No 1 Pty Limited) and (WVB Constructions Pty Limited).

Current Table

8. The Court proceedings current for the reporting period are set out below. The external costs include both external legal and expert consultants’ (Court witnesses’) fees.

No.	Property Address / Applicant / Proceedings Number	Description of Matter	Status / Critical Dates
Land and Environment Court Proceedings – Class 1 Appeals
1	58 and 60 Blackshaw Avenue, Mortdale Applicant: Marion McDowell and Associates Proceedings No. 294745 of 2017	Class 1 Appeal against refusal of Building Certificate Application No. 149D2016/0038 lodged on 21 September 2016 and refused on 20 September 2017.		Matter listed for contested hearing on 2 March 2018. Following this, Applicant ordered to carry out structural rectification works and completed storm water works. Outstanding Building Information Certificate matters for 58 Blackshaw Avenue being finalised through Council’s building team. Note: 60 Blackshaw Ave recently sold and new owner has, following receipt of a Notice from Council, demolished the dangerous structure.
2	2 – 10 Woniora Road, Hurstville Applicant: Stellar Hurstville Pty Limited Proceedings No. 2017/370324	Class 1 Appeal against deemed refusal of DA262/2016 for demolition of existing buildings and ancillary structures and construction of a new mixed use commercial residential building comprising three basement levels containing car parking and storage, ground floor commercial and basement parking and 12 residential apartment levels containing 112 apartments.		Matter was not resolved at the S34 Conference on 15 June 2018 and has been set down for hearing on 11, 12 and 13 February 2019. External heritage, traffic and urban design expert retained.
3	2 – 4 Gladstone Street & 10 Victor Street, Kogarah Applicant: Vortex Property Group Proceedings No. 2017/377046 Kogarah North Precinct	Class 1 appeal against Council’s deemed refusal of DA 2017/0519 for demolition of existing structures and construction of eleven (11) storey residential flat building containing thirty eight (38) units with basement car parking at 2 – 4 Gladstone Street and 10 Victor Street, Kogarah.		Matter was not resolved at the S34 Conference on 11 July 2018 and has been listed for hearing on 4, 5 and 6 March 2019. External traffic, heritage and urban design briefed.
4	1 – 3 John Street, Kogarah Bay Applicant: Al Abrahim Proceedings No. 2018/114721	Class 1 appeal against deemed refusal to grant development consent to the Applicant for the demolition of existing structures and construction of a 7 storey residential flat building compromising 25 residential apartments and basement parking to 1 – 3 John Street, Kogarah Bay.		Matter was not resolved at the S34 Conference on 26 September 2018 and has been listed for hearing on 9 and 10 April 2019.
5	10 – 12 Mimosa Street, Oatley Applicant: Ezra 1 Pty Limited Proceedings No: 2018/140860	Class 1 appeal against deemed refusal of Development Application DA2018/0071 for demolition of existing structures and construction of basement car park and 8 attached units to be used as seniors living housing and other ancillary works.		Matter was not resolved at the S34 Conference on 17 October 2018 and has been listed for hearing on 3 and 4 June 2019. External planner, traffic, acoustic and urban design consultants briefed.
6	313 – 323 Princes Highway, Carlton Applicant: Carlton Investments No. 1 Pty Limited Proceedings No: 2018/ 140963	Class 1 appeal against deemed refusal of DA2018/0102 for demolition of existing structures and construction of a part five (5) part six (6) storey mixed use development with three (3) levels of basement car parking.		Matter was not resolved at the S34 Conference on 27 November 2018 and has been listed for hearing on 27 & 28 June 2019. External solicitor, planner and traffic expert have been retained.
7	71 – 97 Regent Street, Kogarah Applicant: 95 Regent Street Kogarah Pty Limited Proceedings No: 2018/140943 Kogarah North Precinct SSPP concurrence authority	Class 1 appeal against deemed refusal of DA2017/0438 for demolition of existing structures and construction of a part 12 part 13 storey residential flat building development with 3 levels of basement car parking.		Matter was not resolved at the S34 Conference on 16 November 2018 and is listed for hearing on 24 & 25 June 2019. External planning, urban design and traffic experts have been retained.
8	22 – 26 Montgomery Street, Kogarah Applicant: Icon Consulting Group Pty Limited Proceedings No: 2018/167910	Class 1 appeal against deemed refusal of Development Application DA2018/0138 for partial demolition of existing buildings, restoration of existing heritage listed terraces and construction of a 12 storey plus rooftop, mixed use development consisting of 27 residential units, commercial retail floor area and basement car parking.		Matter was not resolved at S34 Conference on 3 December 2018 and has been listed for hearing on 1 and 2 July 2019. External planner, heritage and urban design experts retained.
9	36 Bunyala Street, Blakehurst Applicant: Lateral Estate Pty Limited Proceedings No: 2018/201275 SSPP concurrence authority	Class 1 appeal against deemed refusal of DA2017/0649 for the demolition of existing structures, tree removal, excavation, shoring, piling works and the construction of a residential flat development comprising 49 apartments, basement car parking and landscape works.		Matter has been listed for S34 Conference on 21 February 2019.
10	44 Mulga Road, Oatley Applicant: Franco & Susan Lynette Bonamici Proceedings No: 2018/208552	Class 1 appeal against order to remove unauthorised paving dated 8 June 2018.		Matter listed for S34 Conference on 11 January 2019 and a S34 Agreement was entered into for removal of unauthorised paving. Matter complete.
11	2 – 4 Allen Street & 42 – 44 Connells Point Road, South Hurstville Applicant: C A Camperdown Pty Limited Proceedings No: 2018/213640 SSPP concurrence authority	Class 1 appeal against deemed refusal of DA2017/0421 for the construction of an 8 storey mixed use building containing 64 residential units & 2 retail/commercial tenancies and 4 levels of car parking. DA includes part of Council land (public car park).		Matter was not resolved at S34 Conference on 20 December 2018 Matter is listed for a directions hearing on 12 February 2019. External lawyer, planner and urban design experts briefed.
12	158 Connells Point Road, Connells Point Applicant: Chung Kei Ng Proceedings No: 2018/223668	Class 1 appeal against LPP refusal of DA2017/0286 for alterations and additions to a dwelling, construction of a new building to rear and change of use into a child care centre.		Matter was listed for S34 Conference on 24 January 2019 however was not resolved. Matter is listed for hearing on 15 and 16 August 2019.
13	7 Wharf Road, Kogarah Bay Applicant: Rod Zoabi T/A ZTA Architects Proceedings No: 2018/234703	Class 1 appeal against refusal of DA2017/0024 for demolition of existing structures and construction of three storey attached dual occupancy premises with swimming pools and outbuildings and subdivision of land.		Matter listed for s34AA Conciliation Conference on 13 and 14 March 2019.
14	70 Kyle Parade, Kyle Bay Applicant: Marilyn Kidd Proceedings No: 2018/214451	Class 1 Appeal against deemed refusal of DA2017/0625 for subdivision into 2 allotments and demolition of carport structure.		Matter was not resolved at the S34 Conference on 13 November 2018 and is now listed for hearing on 17 and 18 June 2019. External lawyer retained.
15	279 – 281 Belmore Road, Riverwood Applicant: Riverwood Development Company Pty Limited Proceedings No: 2018/244694	Class 1 appeal for refusal of DA2016/0219 for demolition of existing structures and construction of a mixed use development.		Matter is listed for S34 Conference on 4 March 2019. External lawyer together with planning, traffic, urban design and acoustic experts retained.
16	44 Caloola Crescent, Beverly Hills Applicant: Oscar Picciau & Xianyong Zhang Proceedings No: 2018/246713	Class 1 Appeal against refusal of DA2018/0081 for demolition of existing buildings and construction of a new two storey dual occupancy including outbuildings, front fences and swimming pools.		Matter is listed for S34 Conference on 7 and 8 March 2019.
17	32 – 38 Montgomery Street, Kogarah Applicant: Lateral Estate Pty Limited Proceedings No: 2018/260971 SSPP concurrence authority	Class 1 Appeal against deemed refusal of DA2018/0139 for the demolition of existing structures and construction of a 12/13 storey mixed use development comprising a residential flat building with 74 apartments over ground floor retail, basement car parking and landscaping.		Matter was listed for S34 Conference on 12 December 2018 however was not resolved. Matter has been set down for hearing on 29, 30, 31 July and 1 August 2019. External planning, urban design and heritage briefed.
18	10 Renn Street, Kogarah Bay Applicant: Zeina Masri Proceedings No: 2018/281447	Class 1 Appeal against deemed refusal of DA2017/0662 for the construction of a two storey dwelling house with a basement pool, front fence and cabana.		Matter has been set down for S34AA conciliation on 11 and 12 April 2019. External planning consultant retained.
19	513 Princes Highway, Blakehurst Applicant: Borina Pty Limited Proceedings No: 2018/296856	Class 1 Appeal against deemed refusal of DA2018/303 for the demolition of the existing motel and improvements and the erection of a residential flat building development comprising 43 units being 1 x 1 bed and 42 x 2 bed apartments over two levels of basement parking (77 cars).		Matter is set down for a S34 Conference on 29 April 2019. External planning consultant retained.
20	505 – 507 Rocky Point Road, Sans Souci Applicant: Al Abrahim Proceedings No: 2018/317003	Class 1 Appeal against deemed refusal of DA 2018/0252 for the demolition of existing dwellings and ancillary structures and the construction of a mixed-use development over basement parking.		Matter is listed for S34 Conference on 24 May 2018. External planning and urban design experts retained.
21	125 Boundary Road, Peakhurst Applicant: Australian Fitness Management Pty Limited Proceedings No: 2018/310085	Class 1 Appeal against deemed refusal of DA2018/0129 for the fit out and use as a fitness studio (recreation facility (indoor)opening 24 hours, 7 days and associated signage.		Matter is listed for S34 Conference on 20 May 2018. External traffic expert briefed.
22	31 & 31A Regent Street, Kogarah Applicant: Peter Thanos Proceedings No: 2018/363618	Class 1 Appeal against deemed refusal of DA2018/0214 for the demolition of existing building and construction of a 16 room new generation boarding house comprising 1 ground floor commercial tenancy and a car park for 5 vehicles and 4 motorcycle spaces.		Matter listed for S34 Conference on 23 July 2019.
23	143 – 145 Rocky Point Road, Beverley Park Applicant: Adouni & Raad Pty Limited Proceedings No: 2018/369087	Class 1 Appeal against deemed refusal of DA2018/0429 for the demolition of existing building and the construction of a residential flat building, basement car parking, landscaping and associated works		Matter listed for S34 Conference on 31 July 2019.
24	3 Gray Street, Kogarah Applicant: Best Build NSW Pty Limited Proceedings No: 2018/393349	Class 1 Appeal against deemed refusal of DA2018/0201 for the demolition of existing building and the construction of a 6 storey boarding house comprising 44 rooms including site manager room over basement car parking		Matter listed for first directions hearing on 12 February 2019.
25	301 Kingsgrove Road, Kingsgrove Applicant: Futuristic Design Pty Limited Proceedings No: 2018/390589	Class 1 Appeal against refusal of DA2017/0487 for the demolition of all structures and construction of a two (2) storey child care centre for forty seven (47) children and basement car parking		Matter listed for first directions hearing on 6 February 2019. External lawyer has been briefed.
26	22 Empress Street, Hurstville Applicant: Erdogan Kasif Proceedings No: 2019/9753	Appeal against deemed refusal of DA2018/0441 for partial demolition of existing structures and construction of a residential flat building containing 6 apartments with basement car parking		Matter listed for first directions hearing on 14 February 2019.
Land and Environment Court Proceedings – Class 4 Proceedings
1	977 Forest Road, Lugarno Parties: The Congregational Christian Church in Samoa, Parish of Sydney Incorporated and Taeipo Malifa Proceedings No. 2018/23816	Proceedings commenced against Respondents for a declaration that the First and Second Respondents have each breached the Protection of the Environment (Operations) Act 1997 by failing to comply with prevention notices given to each of them under section 96 of that Act by Council.		Mediation on 2 occasions has failed to resolve noise issues. Council’s evidence filed. At the hearing on 12 and 13 December 2018 Consent Orders were entered, which the respondent has failed to comply with. External lawyers and acoustic expert briefed.
2	34 Milsop & 47 Jersey Avenue, Mortdale Parties: Robert Stojanovski & Steven Stojanovski Proceedings No. 2018/99739	Proceedings commenced for unauthorised erection of structures and slabs, including habitation of structure at the premises.		Respondent has failed to comply with Court Orders dated 21 August 2018 requiring demolition of unauthorised structure. Contempt proceedings are listed for hearing on 15 April 2019. External lawyers briefed.
3	39 – 41 Park Road, Hurstville Parties: Owners of 63227 Proceedings No. 2018/282459	Proceedings commenced for non- compliance with fire safety orders.		Consent Orders agreed at the directions hearing on 7 December 2018 regarding costs (now paid) and finalisation of outstanding works, most of which is certification only.
4	East Quarter – 93 Forest Road, Hurstville Parties: Hville FCP Pty Limited Proceedings No: 2018/311231	Proceedings commenced for non-payment of contributions under a Voluntary Planning Agreement for Stage 3 of East Quarter site.		Partial payments made in October and December 2018. Respondent has agreed to Consent Orders to pay Council’s costs and finalise payment of all outstanding monies and obligations by 31 March 2019.
5	297 Rocky Point Road, Sans Souci Parties: Alan Frederick Goddard Proceedings No.: 2018/366019	Proceedings commenced for hoarding at property.		Matter is listed for first directions hearing on 8 February 2019.
Land and Environment Court Proceedings – Class 5 Proceedings
1	111 Gungah Bay Road, Oatley Parties: W K Strong Pty Limited Proceedings No: 2018/227315, 2018/227316, 2018/227317, 2018/227361, 2018/227362 and 2018/227363. Parties: Nader Haidar Proceedings No: 2018/227331, 2018/227332, 2018/227333, 2018/227377, 2018/227378 and 2018/227379. Parties: Khaled Awada Proceedings No: 2018/227336, 2018/227337, 2018/227338, 2018/227399, 2018/227400 and 2018/227401.	Class 5 appeals in relation to lopping and injuring trees and development not in accordance with development consent at 111 Gungah Bay Road, Oatley.		Council’s evidence in chief filed. Matter listed for further directions 15 February 2019 at which time defendants are to enter a plea.
Local Court Proceedings
1	8 Kimberley Road, Hurstville Parties: Petre Dimovski	Prosecution for unlawful removal of 7 trees.		Guilty plea entered and conviction recorded. On 5 December 2018, Magistrate Bartley fined the defendant $10,800 together with $10,000 Prosecutor’s costs.
2	10 Tasker Avenue, Peakhurst Parties: Steve Krimizis Police prosecution	Police prosecution for making threats to and intimidation of Council’s environmental health officer and customer service officer.		Matter has been adjourned for hearing to 8 February 2019. Council has a watching brief.
3	Parties: Mr Xie Police prosecution	Police prosecution for an assault on Council’s parking officer.		Defendant convicted on 13 December 2018 and given 12 month good behaviour bond. Council has a watching brief.
4	50 Queens Road, Connells Point Parties: SAF Developments Pty Limited	Prosecution for development without consent involving unauthorised road closures, materials being stored on the road reserve area, defective/non-compliant sediment and erosion controls , defective non- compliant signage, defective tree protection facilities and allowing materials to enter the storm water system.		Defendant has pleaded guilty to 4 offences. Matter fixed for hearing on sentence 14 June 2019.
5	46 Terry Street, Blakehurst Parties: Austyle Projects Pty Limited	Prosecution for offences of development without consent involving unauthorised road closures, materials being stored on the road/footpath reserve area and non- compliant signage.		Defendant pleaded not guilty. Matter listed for contested hearing on 1 February 2019.
6	Shop 5 & 6, 309 Forest Road, Hurstville (Spicy Orient) Parties: Jiongyao Lin & L Z Infinity Pty Limited	Prosecution for multiple breaches of the Food Act. Defendant has closed business and is unable to be located. Application for substituted service to be made.		Matter is listed for plea or mention on 26 February 2019.
7	Parties: Ross Mitchell	Parking matter		Matter is listed for plea or mention on 21 February 2019.
Supreme Court
1	220 – 226 Princes Highway, Kogarah Bay. Parties: Nikolaos & Marianna Sykalos Proceedings No. 2018/215935	Supreme Court appeal seeking transfer of ownership of public car park on corner of Princes Highway and Park Road to the plaintiffs as adjoining land owners allegedly pursuant to an historic Deed.		Matter listed for further directions hearing on 13 February 2019.
2	Sans Souci Bathers Pavilion Parties: Blakehurst Marina Pty Limited Proceedings No. 2018/297522	Proceedings in relation to an Agreement to Lease and allegations of misleading and deceptive conduct by Council relating to the Sans Souci Bathers Pavilion.		Matter is being handled by Council’s insurers. Matter is listed for Council’s strike-out application of the proceedings on 15 March 2019.
Costs Recovery
1	37 Boronia Street KYLE BAY Parties: Mrs Megan McOnie Proceedings No. 40940 of 2015	Class 4 commenced in relation to failing to comply with Council Notices/Orders relating to a non-compliant swimming pool fence, overgrown vegetation and unhealthy swimming pool water.		Court Orders in support of Council’s Notices/Orders made including costs. Pool safety works to be completed and Mortgagee to sell property.
2	977 Forest Road, Lugarno Applicant: Congregational Christian Church Samoa Parish of Sydney Proceedings No: 103967 of 2017	Class 1 Appeal against refusal of DA2015/0443 for a child care centre.		Council successful in obtaining costs order for $1,200 following applicant’s application being out of time. Costs recovery action being undertaken by external costs recovery agency as the Church and Rev Malifa refused to pay. Matter referred to Council’s debt recovery team.
3	70 – 78 Regent Street, Kogarah Applicant: Regent Land Pty Limited ATF Regent Land Unit Trust Proceedings No. 215083 of 2017 Kogarah North Precinct	Class 1 Appeal against deemed refusal of DA 2017/111 for the demolition of existing buildings over eight lots (5 properties), amalgamation of the lots and development of an 11 storey residential flat building with 127 apartments and 145 car parking spaces.		Appeal upheld with amended plans for 104 apartments on 24 July 2018. Council’s costs of $26,191.00 paid in December 2018.
4	2 – 10 Palmerston Street, Kogarah Applicant: Palmerston Dragon No. 1 Pty Limited Proceedings No. 217105 of 2017 Kogarah North Precinct	Class 1 Appeal against deemed refusal of DA9/2017/112/1 for demolition of existing buildings and construction of a residential flat building comprising 67 residential dwellings over 2 levels of basement parking.		Matter was listed for hearing on 20 & 21 September 2018. External urban design, planning and traffic consultants briefed. S34 Agreement was entered into on 20 September 2018 following amended plans which are height and FSR compliant. The Applicant to pay Council’s s8.15(3) costs of $84,000 by 30 November 2018. Costs paid.
5	11 Stanley Street & 28 – 36 Victoria Street, Kogarah Applicant: No. 1 Victoria Dragons Pty Limited Proceedings No. 217118 of 2017 Kogarah North Precinct	Class 1 Appeal against deemed refusal of DA9/2017/110/1 for demolition of existing buildings and construction of a residential flat building comprising 96 residential dwellings over 3 levels of basement parking.		Section 34 Agreement entered into. Appeal upheld with amended plans on 23 October 2018 which are height and FSR compliant. The Applicant to pay Council’s s8.15(3) costs of $88,000 by 21 December 2018 and additional contributions for public amenities in Kogarah North Precinct in the amount of $2.31million. Costs not paid. Matter referred to Council’s debt recovery team.

9. Costs to date are as follows:

Type	Amount
Class 1 Appeals – Consultants for Court Proceedings	$327,890.00
Class 1 Appeals – Planning DA External Lawyers	$279,647.00
Class 2 Appeals	$0
Class 3 Appeals	$0
Class 4 Appeals	$39,494.00
Class 5 Appeals	$27,163.00
Local Court Prosecutions/Enforcements	$32,105.00
Supreme Court Proceedings	$32,209.00
Industrial Relations Commission (IRC)	$0
Total	$738,508.00

Financial Implications

10. Within budget allocation.

Risk Implications

11. No risks identified.

Community Engagement

12. No community engagement is required.

File Reference

17/1831

Georges River Council – Finance and Governance Committee - Monday, 11 February 2019 Page 18

Item: FIN002-19 Investment Report as at 31 December 2018

Author: Senior Financial Accountant - Reporting

Directorate: Business and Corporate Services

Matter Type: Committee Reports

Recommendation:

That Council receive and note the contents of the Investment Report as at 31 December 2018.

Executive Summary

1. This report details Council’s performance of its investment portfolio as at 31 December 2018 and compares it against key benchmarks.

2. This report also includes the estimated market valuation of Council’s investment portfolio, loan liabilities and any required update on Council’s legal action against various parties.

3. Council’s annualised rate of return is 2.61%, which is 0.69% above benchmark. Income from interest on investments totals $2.7m, which is in line with 2018/19 year-to-date adopted budget.

Background

4. Council’s Responsible Accounting Officer is required to report monthly on Council’s Investment Portfolio and certify that the Investments are held in accordance with Council’s Investment Policy and Section 625 of the Local Government Act.

Investment Performance Commentary

5. Council’s performance against the benchmark for returns of its investment portfolio for December 2018, are as follows:

	1 Month	3 Month	12 Month
Portfolio Performance	0.18%	0.61%	2.61%
Performance Index	0.15%	0.48%	1.92%
Excess	0.03%	0.13%	0.69%

Notes:

a) Portfolio performance is the rate of return of the portfolio over the specified period.

b) The Performance Index is the rate of return of the market (comparable securities) over the specified period.

c) Excess performance is the rate of return of the portfolio in excess of the Performance Index.

6. Council’s investment portfolio as at the end of December was as follows:

Security Type	Market Value $000's	% Total Value
Cash at Bank	11,396	5.85%
11am Cash	1,164	0.60%
31 Day Notice Account	22	0.01%
Covered Floating Bond	1,014	0.52%
Flexi Deposit (Fix/Float)	6,000	3.08%
Floating Rate Deposit	5,000	2.57%
Floating Rate Note	62,972	32.26%
Floating Rate TCD	3,512	1.80%
Term Deposit	98,043	50.32%
Managed Funds Trust	5,989	3.00%
Total Cash and Investments	195,112	100.00%

7. At the end of October 2018, Total Cash and Investments were $193.68m and have increased by $1.43m at end of December 2018.

8. Council continues to utilise the Federal Government’s current guarantee ($250k) investing in Term Deposits with a range of Authorised Deposit Taking Institutions (ADI’s) on short to medium term investments (generally 30 days to 180 days maturity) where more competitive rates are available.

Legal Issues

9. Georges River Council will be participating in a Group Class Action against Fitch Ratings Inc., in respect of losses suffered on the Corsair (Cayman Islands) No.4 Ltd Series 6 Kakadu Collaterised Debt Obligation (CDO) notes.

10. Council suffered a capital loss of $214,812 on these investments dating back to December 2006, and will seek damages of the Capital Loss including lost interest as part of the action. As a Group Member, Council will not incur any legal costs or disbursements, or be liable for any adverse costs order that the Court may make in the proceedings.

11. The Lead Applicant to the litigation is liable for costs orders and the estimated costs to Council under the retainer are $1.

12. Squire Patton Boggs Lawyers have advised that as a Group Member, Council’s role is largely passive and instructions will generally be taken from the Lead Applicant.

Loan Liability

13. Council’s loan liability as at 31 December was $1.875m which represents the balance of a $5m 10 year loan drawn down on 16 November 2012 for Jubilee Park upgrade in Mortdale. The next repayment of $125k is due on 25 March 2019.

The outstanding balance on this facility is at a variable interest of 194 basis points over three month BBSW. At the current three month BBSW rate, the interest rate payable is 3.96% pa.

14. Council receives a 4% p.a. subsidy under the NSW Government’s Local Infrastructure Renewal Scheme funding agreement for this Jubilee Park upgrade facility. It is intended to continue this financially-advantageous arrangement through to full term in 2022.

Policy Limits

15. The following graph below shows the limits, as a percentage of total cash investments, of the amount by periods, as allowed under Council’s policy, and comparing them to the amounts actually invested, as a percentage of the total cash investments. It shows that the funds invested are within the limits set in the Investment Policy.

Investment Income

16. Income from interest on investments to 31 December 2018 is estimated at $2.70m, which is in line with 2018/19 year-to-date adopted budget.

Certificate by Director Business and Corporate Services (Responsible Accounting Officer): David Tuxford

17. Investments have been made in accordance with the Local Government Act, Minister’s Guidelines, Regulations and Council’s Investment Policy.

Analysis of Investments

Investment Duration

Investment Term	Market Value ‘000	% Total Value	Policy Limits
0 to < 1 Year	92,362	47.34%	100%
1 to < 3 Years	79,979	40.99%	70%
3 to < 5 Years	22,771	11.67%	50%
Portfolio Total	195,112	100.00%

18. Council’s portfolio is liquid, with 47.34% of assets maturing within 12 months. FRNs, funds and fixed bonds also provide additional liquidity in an emergency.

19. The following graphs show analysis of the total cash investment by:

Type of Investments

20. Council’s investment portfolio is mainly directed to fixed term deposits, which account for approximately 53% of total investments. Yields have steadily contracted, while tracking bond market volatility in the short term.

21. Bank Floating Rate Notes (FRN) offer liquidity and a higher rate of income accrual, which is highly recommended by our Investment Advisors (CPG Research & Advisory) going forward.

22. The following are the types of investments held by Council:

a) Cash and Call Accounts refer to funds held at a financial institution and can be recalled by Council either same day or on an overnight basis.

b) A FRN is a debt security issued by a company with a variable interest rate. This can either be issued as Certificates of Deposit (CD) or as Medium Term Notes (MTN). The interest rate can be either fixed or floating, where the adjustments to the interest rate are usually made quarterly and are tied to a certain money market index such as the Bank Bill Swap Rate.

c) A Fixed Term Deposit is a debt security issued by a company with a fixed interest rate over the term of the deposit.

d) A managed fund is a professionally managed investment portfolio that individual investors can buy into, purchasing 'units' rather than shares. Each managed fund has a specific investment objective. This is usually based around the different asset classes (cash, fixed interest, property and shares). The money you invest is used to buy assets in line with this investment objective. When you invest in a managed fund, you are allocated a number of 'units'. The value of your units is calculated on a daily basis and changes as the market value of the assets in the fund rises and falls.

* These managed funds have been grandfathered since the NSW State Government changed the list of Approved Investments as a result of the Cole enquiry (which was reflected in the Ministerial Order dated 31/7/2008).

Credit Rating

23. Credit ratings are generally a statement as to an institution’s credit quality. Ratings ranging from AA to NR (Short Term) & AA to NR (long term) are considered investment grade.

24. A general guide as to the meaning of each credit rating that Council deals with is as follows:

Short-term

AA: The best quality companies, reliable and stable. An obligor’s capacity to meet its financial commitments on the obligation is very strong.

A: The obligor’s capacity to meet its financial commitments on the obligation is still strong but is somewhat more susceptible to the adverse effects of changes in circumstances and economic conditions.

BBB: Adequate capacity to meet financial commitments, but adverse economic conditions or changing circumstances are more likely to weaken the obligor’s capacity to meet its financial commitments.

Unrated: This category includes unrated Authorised Deposit-Taking Institutions (ADI’s) such as some Credit Unions and Building Societies to the extent not Commonwealth-guaranteed. No rating has been requested, or there is insufficient information on which to base a rating.

Long-term

AA: Quality companies, a bit higher risk than AAA. An obligor has very strong capacity to meet its financial commitments. It differs from the highest-rated obligors only to a small degree.

A: Economic situation can affect finance. An obligor has strong capacity to meet its financial commitments but is somewhat more susceptible to the adverse effects of changes in circumstances and economic conditions than obligors in higher-rated categories.

BBB: Medium class companies, which are satisfactory at the moment. An obligor has adequate capacity to meet its financial commitments. However, adverse economic conditions or changing circumstances are more likely to lead to a weakened capacity of the obligor to meet its financial commitments.

25. The credit quality of Council’s portfolio is relatively high with approximately 73% of assets rated ‘A’ or higher. The ‘AAA’ assets represent the deposit investments covered by the Federal Government’s Financial Claims Scheme (FCS).

26. The remaining 27% rated ‘BBB’ or ‘unrated’ reflects the deposit and FRN investments with the regional and unrated ADIs.

Council’s Investment Powers

27. Council’s investment powers are regulated by Section 625 of the NSW Local Government Act (1993), which states:

· A council may invest money that is not, for the time being, required by the council for any other purpose.

· Money may be invested only in a form of investment notified by order of the Minister published in the Gazette.

· An order of the Minister notifying a form of investment for the purposes of this section must not be made without the approval of the Treasurer.

· The acquisition, in accordance with section 358, of a controlling interest in a corporation or an entity within the meaning of that section is not an investment for the purposes of this section.

28. Council’s investment policy and strategy requires that all investments are to be made in accordance with:

· Local Government Act 1993 - Section 625

· Local Government Act 1993 - Order (of the Minister) dated 12 January 2011

· The Trustee Amendment (Discretionary Investments) Act 1997 – Sections 14A (2), 14C (1) & (2)

· Local Government (Financial Management) Regulation 1993

· Investment Guidelines issued by the Department of Local Government

Financial Implications

29. Within budget allocation.

Risk Implications

30. Enterprise risk/s identified and management process applied.

31. Council’s enterprise risk identified was ‘poor financial management adversely impacts Council’s long term financial sustainability’. The risk has been managed by Council’s management of investments in accordance with the relevant act and regulations, along with Council adopted Investment Policy. To further minimise the risk, Council will progressively move towards placement of investments only in investments rated A and above.

Community Engagement

32. No community consultation is required as a result of this report. Members of the community are able to attend and address Council at the Council meeting in relation to this matter in accordance with Council’s Code of Meeting Practice.

File Reference

D19/9806

ATTACHMENTS

Attachment ⇩1

Investment Report as at 31 December 2018

Georges River Council – Finance and Governance Committee - Monday, 11 February 2019 Page 47

Item: FIN007-19 Property Matter - Proposed Lease of Community Land - 296 Forest Road, Hurstville

Author: Strategic Property Specialist and Solicitor

Directorate: Community and Culture

Matter Type: Committee Reports

Recommendation

(a) That Council resolve to enter into a lease with Ganellen Pty Ltd for part of the Hurstville Plaza on the terms and conditions as generally detailed in this report, to allow construction hoarding to be erected.

(b) That rent be charged in accordance with the rate for Hoardings in the Georges River Council Fees & Charges as are applicable to each month of the Lease.

(d) That the General Manger execute the Lease under delegated authority, subject to no major submissions being received during the exhibition period.

Executive Summary

1. Ganellen Pty Ltd (Ganellen) seeks to erect construction hoarding on a portion of Hurstville Plaza to facilitate the development of the adjoining site at 282-290 Forest Rd, Hurstville. The matter must be dealt with as a lease as the land in question is classified as community land.

Background

2. Council is the owner of land described as Lot 16 in Deposited Plan 4799 located at 296 Forest Road, Hurstville. The land is known as Hurstville Plaza (Plaza, formerly Central Plaza) and is classified as community land.

3. On 25 August 2017, Council issued development consent No. DA2016/0322 to Telado Pty Ltd for the construction of a 14 storey building on the adjoining site at 282-290 Forest Rd (Property) (Development). The approved drawings show that an awning is to be constructed over the Plaza. See approved Drawing DA- 0501, Revision 2 dated 17/2/2017, prepared by CPG (Attachment 1).

4. The Property has frontages to the Plaza, Forest Road to the south, and Humphreys Lane/Crofts Avenue to the north.

5. Ganellen is the appointed builder for the Development.

6. In November 2018, Ganellen lodged Temporary Structures Applications (Stage 1, 2 and 3), seeking approval for construction hoardings on the Forest Road, Humphreys Lane and the Plaza frontages of the Property during demolition and construction of the development.

7. Whilst it is possible to approve the hoarding on the Humphreys Lane and Forest Road frontages of the Property under section 68 of the Local Government Act, 1993 (LG Act) and section 138 of the Roads Act, 1993 (Roads Act), the hoarding on the Plaza cannot be approved in the same way because it is Council owned land classified as community under the LG Act.

8. On 10 January 2019 Ganellen lodged a revised Temporary Structures Application for Stage 1 for the demolition of the building and construction of basement to ground level, pertaining only to the Humphrey’s Lane and Forest Road frontages of the Property (the Stage 1 Application).

9. Type B hoarding will be erected along the Forest Rd frontage) and the Humphrey’s lane frontage from 4 March 2019 (after the Lunar New Year celebrations) for a period of approximately 13 months. Copy of draft approval attached at CONFIDENTIAL Attachment 2.

10. The fees due for the hoarding approval will be in accordance with the adopted Fees and Charges (relevant to each month of the approval). Currently, the Georges River Council Fees & Charges 2018/2019 specifies a rate of $65 per square metre for Type B hoarding.

11. On 26 November 2018 Council resolved to defer the Updated Fees and Charges to a Councillor Briefing and Workshop for discussion and information. A copy of the Proposed Changes to the 2018/2019 Fees and Charges Schedule is at Attachment 3.

12. On 21 December 2018, Urbis, on behalf of Ganellen, provided a submission in response to the Proposed Changes to the 2018/2019 Fees and Charges Schedule. A copy of this submission is at CONFIDENTIAL Attachment 4.

Proposed Lease of Hurstville Plaza

13. Ganellen seeks to occupy the Plaza to accommodate approximately 168 square metres of construction hoarding in the Plaza as follows:

· Phase 1 – Type B hoarding for months 0-7 commencing 4 March 2019.

· Phase 2 – Type A hoarding for months 8-15 with a month to month extension as required.

Copies of the proposed Phase 1 and 2 plans are attached at Attachment 5.

14. The Type A hoarding proposed for Phase 2 will only be acceptable if Council officers determine that the safety of the Plaza and pedestrians will be adequately protected by Type A hoarding above the Development’s approved concrete awning. Otherwise, the lease requires that Type B hoarding is required over the Plaza for Phase 2.

15. Council can only grant occupation of community land by lease or licence (s45 of the LG Act).

16. When the Type A hoarding is erected (above the awning), Ganellen will have exclusive occupation of the area within the hoarding. As such, any occupation of the Plaza must be by lease.

17. Relevantly, s46 of the LG Act provides that a lease, “can only be granted over community land with an express authorisation in the plan of management and such provisions of the plan of management as apply to the granting of the lease, licence or other estate, and ……for a purpose prescribed by subsection (4), or for a purpose prescribed by any of sections 36E to 36N as a core objective of the categorisation of the land concerned”.

18. The Plaza is subject to the Central Plaza, Hurstville Plan of Management dated October 2016 (the POM). A copy of the POM is at Attachment 6.

19. The Plaza is categorised as general community use, the core objectives of that use are outlined in s36I of the LG Act.

20. The POM does not make specific reference to the erection of hoarding on community land in the Table of Permitted Uses. Council officers requested Ganellen provide legal advice to demonstrate that Council can lease part of the Plaza to Ganellen for the purposes of construction hoarding.

21. Ganellen have provided advice from Mr Danny Feller SC, who advised that the proposed lease is authorised by the POM and that the lease is for a purpose prescribed by s36I of the LG Act. A copy of Mr Feller SC’s advice is at CONFIDENTIAL Attachment 7. Based on that advice, the Lease can be granted.

22. Pending (and subject to) Council’s resolution to grant the lease, Council’s panel solicitor Mr Brian Olliver, has prepared the attached Lease (CONFIDENTIAL Attachment 8). The Lease has been prepared at Ganellen’s cost whether or not Council resolves to enter into the Lease.

23. The rent due and payable under the Lease will be in accordance with Council’s adopted fees and charges (as applicable for each month of the Lease).

24. Pursuant to Section 47A of the LG Act, Council is required to advertise the proposed granting of the Lease for a period of 28 days, as the Plaza is community land. Subject to the resolution of Council, the proposed Lease will be advertised in the St George Leader and on Council’s website. Following notification in accordance with the requirements of s47 of the LG Act, the General Manager can execute the Lease under delegation.

Financial Implications

25. Under the Lease, rent will be charged in accordance with the rates for Hoardings in the Georges River Council Fees & Charges as are applicable to each month of the Lease. Currently, adopted fees and charges for Hoardings in the Georges River Council Fees & Charges 2018/2019, are $65 per square metre for Type B hoarding and $45 per lineal metre of Type A hoarding.

Risk Implications

26. The hoarding on the Plaza is essential for risk management and public safety in the Plaza during the construction of the Development.

Community Engagement

27. Subject to the resolution of Council, the proposed Lease will be advertised in the St George Leader and on Council’s website for a period of 28 days. Thereafter, the General Manager can execute the Lease under delegation.

File Reference

18/2707

ATTACHMENTS

Attachment ⇩1	2018/2019 Proposed Changes to Fees and Charges
Attachment ⇩2	Drawing DA-0501 Revision 2 dated 17 February 2017 prepared by CPG
Attachment 3	282-290 Forest Road Hurstville - Advice from Urbis on behalf of Ganellen (Confidential)
Attachment ⇩4	Phase 1 and Phase 2 Hoarding Plans
Attachment ⇩5	Central Plaza Hurstville Plan of Management
Attachment 6	Ganellen Advice from Senior Counsel (Confidential)
Attachment 7	Proposed Lease to Ganellen Pty Ltd - Part Hurstville Plaza - 296 Forest Road Hurstville (Confidential)

Georges River Council – Finance and Governance Committee - Monday, 11 February 2019 Page 92

Item: FIN010-19 Tender for Advertising Signs - T18/061

Author: Strategic Property Specialist

Directorate: Community and Culture

Matter Type: Committee Reports

Recommendation

(a) That Council awards the tender for Advertising Signs as generally detailed in this report.

(b) That the General Manager be delegated authority to enter into and sign all lease documentation and any associated documentation with the preferred Tenderer on behalf of Council.

Executive Summary

1. The purpose of this report is to advise Council of the results of the tender process completed in accordance with Part 3, Division 1, Section 55 and Section 377 of the Local Government Act 1993, for the appointment of a lessee for the operation of the advertising sign and to seek a resolution from Council on entering into a lease agreement with a successful Tenderer.

2. This report explains the background for Council to decide if it wishes to enter into a lease agreement with the successful Tenderer. The report details the tender process supporting the recommendation for Council’s consideration.

Background

3. At the Council meeting on 26 March 2018 the Council resolved the following:

That Council commence an Expression of Interest process for the lease of prime billboard advertising sites in Blakehurst and Penshurst as generally detailed in this report and that a further report be submitted to Council following completion of the Expression of Interest process.

4. Georges River Council proposes to enter into a lease agreement with the successful Tenderer to construct and operate an advertising sign at two prime locations being Corner of Princes Highway and Stuart Street Blakehurst and Corner King Georges Road and Forest Road Penshurst.

5. The proposed lease term was for a five (5) year period with a further five (5) year option period.

6. The successful tenderer will be responsible for the construction and establishment of the sign structure at their own cost.

7. Council Officers prepared a Request for Tender for Advertising Signs.

8. This report provides the information on the tendering process undertaken, the evaluation criteria, the tender evaluation process and the outcome.

9. Tender documentation included:

a. RFT T18/061 – Advertising Signs

b. Conditions of Tendering

c. Assessment Criteria

d. Submission Form

e. Proposed Agreement for Lease and Lease Documentation

10. The Tender Evaluation Committee (TEC) determined the Tender Evaluation Criteria prior to advertising of the tender. The assessment criteria was determined as follows:

a. Proposed Letter of Intent – Commercial Terms

b. Previous Experience - relevant experience in operating a like business, or relevant work experience in the same industry.

c. Financial Capability

d. Business Plan – proposed establishment and advertising material.

11. The evaluation criteria for this tender included compliance and qualitative assessments. The established weighting ratio of price to non-price (qualitative) is 60:40. The price and non-price scoring procedures were established within the TEP.

12. Council advertised the Request for Tenders on Tuesday the 23rd October 2018 with a view to enter into a lease agreement with a successful operator to construct and operate advertising signs as per proposed Contract Number T18/061.

13. The tender closed on 13^th November 2018 at 10:00am in the presence of the Tender Opening Committee.

14. The TEC met on a single occasion, 7^th December 2018 to review and accept the Panel; understand the evaluation process including methodology and, sign the Conflicts of Interest Declarations having been made aware of the identities of the Tenderers.

Evaluation

15. TEC assessed the submissions on the following criteria using the TEP (Confidential Attachment 1):

a. Commercial Terms - 60%

b. Previous Experience - 15%

c. Financial Capability - 15%

d. Business Plan - 10%

16. The TEC completed the tender assessments and the evaluation process and identified a tender that represents the best value as the tender that provides highest revenue return for Council.

17. The TEC, having completed the evaluation of tenders in compliance with the TEP, makes the following recommendation to Council in accordance with Section 178 of the Local Government (General) Regulation 2005 (NSW) to accept the tender from the preferred Tenderer for the Contract Number T18/061.

Financial Implications

18. Within budget allocation.

Risk Implications

19. No risks identified.

Community Engagement

20. Community engagement is not applicable.

File Reference

T18/061

ATTACHMENTS

Attachment 1

Confidential Attachment to the Council Report - Tender Evaluation Report (Confidential)

Georges River Council – Finance and Governance Committee - Monday, 11 February 2019 Page 96

Item: FIN011-19 Transformation and Change Program Closure Report

Author: Director Transformation and Change

Directorate: Transformation and Change

Matter Type: Committee Reports

Recommendation

(a) That the attached report “The Amalgamation Journey: Final Report” outlining the activities and outcomes of the Amalgamation Implementation Plan be provided to the Office of Local Government as Council’s acquittal report on the New Council Implementation Fund grant.

(b) That the attached report “The Amalgamation Journey: Final Report” be published on Council’s website

Executive Summary

1. The amalgamation of two organisations whilst maintaining everyday services is a complex task that requires the involvement of the entire organisation and the support of a community. Georges River Council has embraced the fresh start that the merger of the former Hurstville City and Kogarah City Councils had presented, building the foundations for a strong and sustainable organisation that will deliver outstanding results to our community and city.

2. To effectively manage the amalgamation Council established the Transformation and Change Directorate funded by the New Council Implementation Fund (NCIF) provided by the NSW Government. This funding contributed to the integration and improvement of systems and technology, strengthening policies and procedures, improving governance, communications and branding, and building a culture of customer service among Council staff.

3. The entire organisation contributed to projects outlined in the Implementation Plan. The attached report outlines how we successfully delivered benefits to council and the community.

Background

Driving Transformation & Change

4. In November 2016, Council adopted the Transformation and Change Implementation Plan which provides a framework for ensuring the integration process is organised, efficient and benefits the community. All parts of the organisation actively contributed to the change program and played a role in achieving the outcomes.

5. The Transformation and Change Directorate coordinated and supported all amalgamation activities across Council with a view to making Georges River Council the best performing Council in New South Wales.

6. The Transformation and Change program achieved 90% of project milestones (792 milestones). The remaining milestones will be completed in the 2019 calendar by the responsible department.

Creating a Strong Council

7. A comprehensive Councillor Induction Program was undertaken to support the newly elected members in their role. Councillors received extensive training and expert advice in relation to the Code of Conduct, Expenses and Facilities Policy and Code of Meeting Practice. The Councillor Portal, an online and secure Intranet site, was also established for Councillors to provide important information in a timely manner.

8. Council is committed to being open and accountable to our local community and ensuring our policies and procedures reflect community goals and aspirations. Some achievements include:

· A complete suite of integrated planning and reporting documents have been adopted guiding our strategic delivery of services and infrastructure across the city.

· The development of 52 governance policies, guided by an ethos of simplicity and customer orientation.

· Appointment of an Internal Auditor and creation of an Audit, Risk and Improvement Committee supported by an adopted Risk Policy including Risk Appetite Statements, an Enterprise Risk Management Strategy and Business Unit Risk Management to ensure good governance, strong management and minimisation of risk.

· The harmonisation of our two financial systems has led to significant Improvements to financial budgeting and reporting.

· Process improvements to critical functions such as accounts payable, rates, procurement and our after-hours service provision.

9. As a united team of staff we adopted our Mission and Values, which have been embedded into our recruitment and performance review processes.

10. Council participated in industry initiatives that will enhance capability across local government and assist us to benchmark our services. These include the Local Government New South Wales Capability Framework, the 2017 Local Government Performance Excellence Program and the Australasian Management Challenge.

Improving our service offerings

11. 2018 was the year of the Customer, and the following improvements were made to improve the customers experience:

· Adoption of our Customer Service Strategy and the Feedback and Complaints Policy

· Ongoing development of our service centres at Kogarah and Hurstville and our two main libraries as well as Customer Service pop ups in different locations

· Omni-channel contact centre to assist customers access Council how they choose.

· An independent service delivery review of Customer Service which established the Customer Experience Program which will be implemented over the next two years.

Delivering a liveable City

12. Since amalgamation, 95% of the scheduled Major projects funded by the SCF have been delivered resulting in improved community infrastructure and services for our growing community. The Stronger Communities Fund achievements will be presented in a separate report however some highlights include:

a. Replacement of Kogarah Library roof

b. The installation of 150 square metres of green rubber softfall and a shade structure in Timothy Reserve Hurstville

c. Upgrades to the netball courts at Olds Park in Penshurst

d. Hurstville Oval Velodrome has been resurfaced returning the historic venue to a first class facility for cyclists

e. A shade structure was constructed at Carss Cottage Museum Carss Bush Park providing shade relief for visitors

f. Resurfacing of fields at Poulton Park have made the grounds safer for children playing soccer, saved the ground from unnecessary wear and tear and increased the lifespan of the grounds

g. As part of the Georges River Aquatic Facilities Refurbishment Program the refurbished Sans Souci Pool now includes a 50metre and toddler pools, a new plant room and new amenities.

13. We have begun a series of activities to drive economic development and place activation for the Local Area. Driven by the Strategic Events and Economic Development Strategies, we have delivered initiatives in Hurstville including The Big Wash and Makeover Month as well as Open Air Cinemas, Night Markets and ‘Noons with Tunes’ in Kogarah.

A shift towards transforming our City

14. In a new partnership formed with the University of New South Wales, Council has invested in smart technology solutions that will lead to improved community spaces. Council’s early adoption of smart infrastructure means the community will benefit from innovative solutions which provide long term and tangible benefits.

15. Council has initiated ‘The Cool Places: Urban Oasis’ project which will provide an enhanced tree canopy in our town centres to deliver an improved experience for users that will benefit both residents and local businesses.

16. This emphasis on new ways of thinking has provided the foundations for an ongoing portfolio of innovation, service excellence and robust, productive relationships for our city. Over the coming year the City Strategy and Innovation Directorate will focus on positioning the Georges River area and the Council as strong and influential in both the Sydney Metropolitan Region and in New South Wales.

Financial Implications

17. The New Council Implementation Fund (NCIF) was granted to Council to defray the costs of amalgamation. Including interest generated throughout the program, with just over $10.8M available.

18.

19. The grant was expended in the following areas:

22 The attached report provides details of the program including tasks undertaken and benefits realised. It will form the final report acquitting the grant to the Office of Local Government.

Risk Implications

20. Enterprise risk/s and Operational risk/s were identified and management process applied.

Community Engagement

21. Community engagement was conducted throughout the program.

File Reference

< Enter Records Reference Number Here >

ATTACHMENTS

Attachment ⇩1