AGENDA


Finance and Governance Committee

 

Monday, 09 November 2020

6.00pm

 

Dragon Room (Level 1,Georges River Civic Centre,

Hurstville)

and

Skype Online Meeting

 

 

 

 

 

 

 

 

 

 

 


Georges River Council –      Finance and Governance Committee -  Monday, 9 November 2020                                                                                        Page 2

 

Finance and Governance Committee

ORDER OF BUSINESS

 

1.     OPENING

2.     ACKNOWLEDGEMENT OF COUNTRY

3.     APOLOGIES / LEAVE OF ABSENCE

4.     NOTICE OF WEBCASTING

5.     DISCLOSURES OF INTEREST

6.     PUBLIC FORUM

7.     CONFIRMATION OF MINUTES OF PREVIOUS MEETING

FIN051-20        Confirmation of the minutes of the previous meeting held on 12 October 2020

(Report by Executive Services Officer)......................................................... 4  

8.     COMMITTEE REPORTS

FIN052-20        Administrative Matter - Execution of Documents Under Delegated Authority (1 October 2020 to 31 October 2020)

(Report by Manager, Office of the General Manager)........................... 11

FIN053-20        Report on Outstanding Council Resolutions (Period up to and including 30 September 2020)

(Report by Manager, Office of the General Manager)........................... 13

FIN054-20        Investment Report as at 30 September 2020

(Report by Senior Financial Accountant - Reporting).................. 60

FIN055-20        Quarterly Budget Review Statement for the period ending 30 September 2020

(Report by Chief Financial Officer).. 75

FIN056-20        Code of Conduct Complaint Statistics 2020

(Report by Governance and Risk Specialist)....................................... 95

FIN057-20        Tender - T20/011 Supply, Installation and Ongoing Maintenance of Commercial Car Parking Equipment

(Report by Head of Strategic Property)....................................................... 97

FIN058-20        Tender T20/008 - Provision of Property Management Services

(Report by Strategic Property Specialist)..................................... 101

FIN059-20        Profit and Loss Statements - Premium and Community Leases

(Report by Chief Financial Officer) 104

 

 

FIN060-20        Property Matter - Commercial Property Portfolio - 2020/21 First Quarter Report

(Report by Strategic Property Specialist)..................................... 108

FIN061-20        Property Matter - Street Name Sign Advertisements ("Identilites") - Proposed New Contract

(Report by Strategic Property Specialist)..................................... 110  

 

 


Georges River Council –      Finance and Governance Committee -  Monday, 9 November 2020                                                                                        Page 4

CONFIRMATION OF MINUTES OF PREVIOUS MEETINGS

Item:                FIN051-20    Confirmation of the minutes of the previous meeting held on 12 October 2020 

Author:            Executive Services Officer

Directorate:     Office of the General Manager

Matter Type:    Previous Minutes

 

 

RECOMMENDATION:

That the Minutes of the Finance and Governance Committee Meeting held on 12 October 2020 be confirmed.

 

 

EXECUTIVE SUMMARY

The Minutes of the Finance and Governance Committee Meeting held on 12 October 2020, as attached, be confirmed by the Committee as a true and correct record of that meeting.

 

ATTACHMENTS

Attachment 1

Minutes of the Finance and Governance Committee - 12/10/2020


Georges River Council –      Finance and Governance Committee -  Monday, 9 November 2020                                                                                      Page 10

 



Georges River Council –      Finance and Governance Committee -  Monday, 9 November 2020                                                                                      Page 12

COMMITTEE REPORTS

Item:                FIN052-20                Administrative Matter - Execution of Documents Under Delegated Authority (1 October 2020 to 31 October 2020) 

Author:            Manager, Office of the General Manager

Directorate:     Office of the General Manager

Matter Type:    Committee Reports

 

 

 

Recommendation:

That Council note, for the period 1 October 2020 to 31 October 2020, there were two (2) documents executed by the General Manager under delegation.

 

Executive Summary

At its meeting on 24 February 2020, Council resolved that the General Manager report to Council any lease, contract or hire agreement (excluding staff contracts) executed under delegation.

REPORT

Council at its meeting on 24 September 2018, delegated to the General Manager the General Manager’s Delegations (Instrument of Delegation).

During the period 1 October 2020 to 31 October 2020 the following documents have been executed by the General Manager under Delegation.

Community Leases

Date Executed

Document Type

Premises

Nil

 

 

Premium Facilities

Date Executed

Document Type

Premises

Nil

 

 

Commercial Leases

Date Executed

Document Type

Premises

13 October 2020

Lease

-    Health Administration Corporation

5 Depot Road, Mortdale

22 October 2020

Lease

-    Nova Employment Limited

Suites 501, 502 and 503, 34 MacMahon Street, Hurstville

Contracts

Date Executed

Document Type

Premises

Nil

 

 

Financial Implications

No budget impact for this report.

Risk Implications

No risks identified.

File Reference

D20/264926

 

 

 

  


Georges River Council –      Finance and Governance Committee -  Monday, 9 November 2020                                                                                      Page 13

Item:                FIN053-20    Report on Outstanding Council Resolutions (Period up to and including 30 September 2020) 

Author:            Manager, Office of the General Manager

Directorate:     Office of the General Manager

Matter Type:    Committee Reports

 

 

 

RECOMMENDATION:

That the report on Outstanding Council Resolutions (period up to and including 30 September 2020), be received and noted.

 

EXECUTIVE SUMMARY

1.     This report provides progress on outstanding resolutions up to and including 30 September 2020.

BACKGROUND

2.     Attachment 1 contains all Council resolutions that remain outstanding or require further action. 

3.     Completed items have been marked accordingly and will be removed from future reports. 

 

FINANCIAL IMPLICATIONS

4.     There are no budget implications for this report.

 

RISK IMPLICATIONS

5.  The Enterprise Risk Management Strategy contains relevant actions in regards to the provision of an open, accessible and transparent decision making and meeting process.  The quarterly consideration of this report ensures that Councillors and members of the community are informed in regards to the status of implementation of council resolutions.  Operational risk/s identified and management process applied.

 

COMMUNITY ENGAGEMENT

6.     Members of the community are able to attend and address Council meetings in accordance with Council’s Code of Meeting Practice.

 

FILE REFERENCE

D20/265020

 


Georges River Council –      Finance and Governance Committee -  Monday, 9 November 2020                                                                                      Page 21

 

  


Georges River Council –      Finance and Governance Committee -  Monday, 9 November 2020                                                                                      Page 66

Item:                FIN054-20    Investment Report as at 30 September 2020 

Author:            Senior Financial Accountant - Reporting

Directorate:     Business and Corporate Services

Matter Type:    Committee Reports

 

 

 

Recommendation:

That Council receives and notes the contents of the Investment Report as at 30 September 2020.

 

Executive Summary

1.     This report details Council’s performance of its investment portfolio as at 30 September 2020, 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 1.77% which is 1.19% above benchmark. Income from interest on investments totals $492,136 which is $16,863 lower than the 2020/21 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, Section 625 of the Local Government Act (NSW) 1993 and Local Government (General) Regulation 2005.

Investment Performance Commentary

5.     Council’s performance against the benchmark for returns of its investment portfolio for September 2020, are as follows:

 

1 Month

3 Month

12 Month

Portfolio Performance

0.08%

0.41%

1.77%

Performance Index

0.01%

0.03%

0.58%

Excess

0.07%

0.38%

1.19%

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 September was as follows:

Security Type

Market Value $000's

% Total Value

At Call Deposit

14,475

9.59%

Consolidated Cash Fund

34,935

23.14%

Covered Floating Bond

1,007

0.67%

Flexi Deposit (Fix/Float)

6,000

3.97%

Floating Rate Deposit

5,000

3.31%

Floating Rate Note

33,188

21.98%

Term Deposit

50,000

   33.12%

Managed Funds Trust

6,379

4.23%

Total Cash and Investments

150,984

100.00%

7.     At the end of August 2020, Total Cash and Investments were $135 million and have increased by $16 million at the end of September 2020.

8.     Council continues to utilise the Federal Government’s current guarantee ($250,000) 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).

Legal Matters

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

Banton Group are the legal firm working on the matter and have continued to confer with counsel to be in a position to commence proceedings against Fitch Ratings Inc. in the near term. Further updates will be presented to Council as they are received.

Borrowings

10.   Council’s loan liability, as at 30 September 2020 was $1million, which represents the balance of a $5 million/10 year loan drawn down on 16 November 2012 for the Jubilee Park upgrade in Mortdale. The next repayment of $125,000 is due on 24 December 2020.

11.   The outstanding balance on this facility is at a variable interest rate of 194 basis points above the three month BBSW. At the current three month BBSW rate, the interest rate payable is 2.03% pa.

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

Policy Limits

13.   The graph below shows the Investment Rating limits, as a percentage of total cash investments, which are allowed under Council’s Investment policy. It also compares 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

14.   Income from interest on investments to 30 September 2020 is $492,136 which is $16,863 lower than the 2020/21 year-to-date adopted budget.

15.   Investments have been made in accordance with the Local Government Act (1993), 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

110,666

73.30%

100%

1 to < 3 Years

33,853

22.42%

70%

3 to < 5 Years

6,465

4.28%

50%

Portfolio Total

150,984

100.00%

 

 

16.   Council’s portfolio is liquid, with 73.30% of assets maturing within 12 months. FRNs, At-Call Funds and Fixed Bonds also provide additional liquidity in an emergency.

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


 

Type of Investments

 

18.   The majority of Council’s investment portfolio is made up of fixed term deposits, which account for approximately 33% of total investments.

19.   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).

20.   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)     An 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

21.   Credit ratings are generally a statement as to an institution’s credit quality. Council’s Investment Advisors (CPG Research & Advisory) use Standard & Poor’s Credit ratings to classify the investments held by Council. Ratings ranging from AA to BBB (Short Term) & AA to BBB (long term) are considered investment grade.

22.   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.

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.

23.   The credit quality of Council’s portfolio is relatively high with approximately 90% of assets rated ‘A’ or higher. The ‘AAA’ assets represent the deposit investments covered by the Federal Government’s Financial Claims Scheme (FCS).

24.   The remaining 10% rated ‘BBB’ or ‘unrated’ reflects the deposit and FRN investments with the regional and unrated ADIs.

Council’s Investment Powers

25.   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.

26.   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

27.   Income from interest on investments totals $492,136 which is $16,863 lower than the 2020/21 year-to-date adopted budget.

Risk Implications

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

29.   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 the placement of investments only in investments rated A or above.

COMMUNITY ENGAGEMENT

30.   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

D20/252013

 

 

ATTACHMENTS

Attachment 1

Investment Report as at 30 September 2020

 


Georges River Council -            Finance and Governance Committee - Monday, 9 November 2020

FIN054-20               Investment Report as at 30 September 2020

[Appendix 1]           Investment Report as at 30 September 2020

 

 

Page 70

 


 


 


 



 


 


 


Georges River Council –      Finance and Governance Committee -  Monday, 9 November 2020                                                                                      Page 78

Item:                FIN055-20    Quarterly Budget Review Statement for the period ending 30 September 2020 

Author:            Chief Financial Officer

Directorate:     Business and Corporate Services

Matter Type:    Committee Reports

 

 

 

Recommendation:

(a)    That Council receives and notes the contents of this report in relation to the Quarterly Budget Review for the period ending 30 September 2020.

(b)    That in accordance with the COVID-19 process resolved by Council in June 2020, Council adopt the proposed amendments to the 2020/21 Budget based on the revised forecasted operational impacts from COVID-19, carryovers from 2019/20 and other variations seen in the first quarter.

(c)    That Council notes the decline in cash receipts from the same quarter last year of 11%.

(d)    That Council notes the forecast operating financial sustainability issues have accelerated from original estimates due to COVID-19 higher than anticipated costs and reduced income in 2019/20.

(e)    That Council notes the operating results of the 2019/20 financial year due to COVID-19 and the likely impact COVID-19 will have on a deteriorating operating result in 2020/21.

(f)     That Council notes the resultant decline of $15.8m in Council’s cash reserve forecast balance from the adopted forecasts in June 2020.

 

Executive Summary

1.  In accordance with the COVID-19 process resolved by Council in June 2020, this report highlights Council’s first quarter performance against the 2020/2021 adopted budget and presents draft budget variations in consideration of projected financial results.

Background

2.     Section 203 of the Local Government (General) Regulation 2005 requires that a Quarterly Budget Review be considered by Council that shows current estimates for income and expenditure for the year; indicates whether Council’s financial position is satisfactory and makes recommendations for remedial action, if required.

3.     Council’s adopted 2020/21 budget did not factor in the projected impacts to income and expenditure from the COVID-19 pandemic. The decision to adopt a business as usual approach and then adjust the Budget each quarter was based on critical factors being unknown, such as the scale of the financial impact, the length of time the Public Health Orders would remain in place and any financial support packages provided.

4.     This report outlines the proposed budget changes, which include revised forecasts on specific services impacted by COVID-19.

 

 

QUARTERLY BUDGET REVIEW STATEMENT FOR PERIOD ENDING 30 SEPTEMBER 2020

Overview of Proposed Changes

5.     The proposed amendments to the 2020/21 Operational Budget result in a new forecast operating deficit of $1.9m. This is an improvement from the original adopted operating deficit of $3.2m. The improvement is based on the receipt of $5.3m in operational grants. An overview of the changes includes:

·        $1.7m reduction in operating income, offset by $5.3m in additional operating grants

·        $9.1m reduction in capital contribution reductions

·        $990,000 increase in operating expenditure

·        $1.4m in operational carryovers from 2019/20

6.     On 30 October 2020, Council officers were advised they were successful in obtaining $4.7m in operational grants as part of the Local Roads and Community Infrastructure Program (LRCI). This has had a considerable favourable impact on Council’s projected results. Without the LRCI grants Council’s revised 2020/21 operating deficit would have increased from $3.2m to $6.5m.

 

7.     The proposed amendments to the 2020/21 Capital Budget result in a revised capital budget of $54.2m. This is an increase of $7.9m from the original adopted budget. An overview of the changes includes:

·        $4m in carryovers from 2019/20

·        $8.7m in additional capital items, material items include:

o   Hurstville Leisure Centre Roof and Filtration System Upgrade ($2.7m)

o   Land Acquisitions ($2.8m)

o   Building, Playground and Other Assets Critical Safety Program ($1m)

8.     Attachment 1 contains detailed information on the proposed changes and quarterly results.

Financial Quarter Performance Overview

9.     The overall financial performance to date of Council is showing a deficit of $200,000 and is marginally ahead of current budget. However, operating income is unfavourably lower than budget and expenditure is also materially lower than budget by $3m. The expenditure levels are expected to increase in the second half of the year, as per previous year cycles.

10.   Currently the impact of COVID-19 on Council’s operating income is being observed in the following areas:

·        Hurstville Aquatic Leisure Centre Income

·        Income from Premium Facilities

·        Income from Events

·        Commercial Property Rentals and Commercial Car Parking

Outlined in Attachment 1 are details of the proposed changes in income and expenditure due to COVID-19 for quarter 1.

11.   It is recommended Council continue to manage financial operations to mitigate the adverse impact of COVID-19, whilst continuing to deliver key services and programs for the community. The financial results of Council will be monitored over the coming months, and if major changes are required, these will continue to be communicated to Council.

12.   The quarter 1 cash receipts comparison (table 8 of attachment 1) highlights an 11% reduction in cash from the same quarter last year. The rates and charges are down by 8% and user fees and charges 24% overall. Rates and charges cash receipts may be impacted by the extension of the due date to 30 September 2020.

Operating Income

13.   Operating income for the quarter is trending below the original budget. This is primarily due to capital grants ($2m) and user fees and charges ($1.1m).

14.   User fees and charges is currently $1,100,000 under budget in the following areas:

·        Hurstville Aquatic Leisure Centre income of $400,000

·        Childcare fees $400,000

·        Hoardings $100,000

·        Events and Venue Hire $100,000.

15.   Interest income performed below budget by $56,000 and this trend is likely to continue for the remainder of the year given the volatility currently seen in the investment markets, higher than budgeted cash utilisation and the historically low cash rate.

16.   Other revenue is above budget by $300,000 due to the Container Deposit Scheme (CDS) Refund Income and Fines. It is noted that COVID-19 has been unfavourably impacting the following areas:

·        Commercial Property Rentals $100,000

·        Commercial Car Parking $100,000

·        Income in Premium Facilities $100,000.

17.   Income from Operating Grants is above budget by $200,000, mainly due to the receipt of the unbudgeted Accelerated Local Environmental Plan (LEP) Grant.

18.   Without the inclusion of the LRCI, the total income reduction being proposed to the revised budget is $10m (details are outlined in attachment 1, tables 2 and 3).

Operating Expenditure

19.   Operating expenditure for the quarter is trending below the annual budget. This is primarily due to the timing of expenditure in Materials & Contracts and lower costs in other expenses from low utilisation of facilities.

20.   Employee costs are currently $400,000 under budget, with savings in Overtime and Casuals and Superannuation.

21.   Materials and Contracts are under budget by $800,000, with the majority of savings in Contractor and Materials expenditure.

22.   Other expenses are under budget by $1.5m, with main savings currently in repairs and maintenance costs $300,000 and $300,000 in Electricity and Street Lighting.

23.   A total increase in operating expenditure of $2.4m is proposed compared to adopted budget. A number of the increases are due to ongoing grants and carryovers, while others relate to employee cost increases (details are outlined in attachment 1, tables 2 and 3).

Capital Program and Reserve Forecast Balance

24.   The revised cash reserves forecast balance for the end of this financial year is $126.3m, which is a $15.8m reduction from the 2020/21 original projected balance. This is largely due to the $10m reduction in forecast developer contribution income (due to a legislative change allowing delayed payment of developer contributions) and the increased utilisation for capital and operational projects.

 

25.   The proposed revised 2020/21 Capital Budget is $54.2m, compared to the original budget of $46.4m (details are outlined in attachment 1, tables 4, 5 and 6). 

26.   Capital expenditure for quarter 1 was $6.7m, with material expenditure occurring on:

·        Penshurst Park Sporting Hub - Stage 2 ($1.7m)

·        Ormond Parade Streetscape ($1.2m)

·        Land Acquisitions ($1.1m)

·        Oatley Park Sporting Amenities ($500,000)

·        Building, Playground and Other Assets Critical Safety Program ($410,000).

Financial Implications

27.   Details of the financial impact are outlined in Attachment 1 and the relevant tables. 

28.   The variations to budget highlighted above has resulted in the year-end budgeted operating deficit of $3.2m now being forecasted to finish at $1.9m. The proposed new revised 2020/21 Capital Budget is $54.2m.

29.   Including capital revenue, the operating surplus of $18.1m has dropped to $10.4m. It should be noted that this change in capital revenue has been due to the legislative change, allowing delayed payment of developer contributions. 

30.   Based on the cash receipts dropping for the quarter and the decline in capital contributions, Council must continue to adhere to the principles outlined in the 2020/21 budget development to protect cash for ongoing operations as internal reserves have declined and are largely committed for future expenditure.    

Risk Implications

31.   Enterprise risk identified and management process applied.

32.   Council’s enterprise risk identified was ‘poor financial management adversely impacts Council’s long term financial sustainability’. The purpose of this report is to provide an update to Council on the financial performance of each quarter of the current budget cycle. This is to enable financial information for sound decision making, to ensure financial sustainability of Council.

Community Engagement

33.   No community consultation is required as a result of this report.

File Reference

19/1401

 

 

ATTACHMENTS

Attachment 1

Quarterly Budget Review Report - Q1 30 September 2020 pdf

 


Georges River Council -            Finance and Governance Committee - Monday, 9 November 2020

FIN055-20               Quarterly Budget Review Statement for the period ending 30 September 2020

[Appendix 1]           Quarterly Budget Review Report - Q1 30 September 2020 pdf

 

 

Page 81

 


 


 



 


 


 


 


 


 


 



 


 


 


 


Georges River Council –      Finance and Governance Committee -  Monday, 9 November 2020                                                                                      Page 96

Item:                FIN056-20                Code of Conduct Complaint Statistics 2020 

Author:            Governance and Risk Specialist

Directorate:     Business and Corporate Services

Matter Type:    Committee Reports

 

 

 

RECOMMENDATION:

That Council receives and notes the report on the Code of Conduct Complaints Statistics for the period ending 30 September 2020.

 

EXECUTIVE SUMMARY

1.     Clause 11.1 of the Procedures for the Administration of the Code of Conduct requires Council’s Code of Conduct Complaints Coordinator to report details of any complaints received about Councillors and the General Manager under the Code of Conduct, within three months of the end of September of each year.

BACKGROUND

2.     Council is required to adopt a Code of Conduct in accordance with s440 of the Local Government Act 1993 and the Local Government (General) Regulation 2005. The statistics provided in this report are required to be reported in the following manner, in accordance with the adopted Procedures for the Administration of the Code of Conduct and OLG guidelines.

 

Total number of code of conduct complaints made about Councillors and the General Manager under the code of conduct in the year to September 2020

 

17

The number of code of conduct complaints referred to a conduct reviewer

14

The number of code of conduct complaints finalised by a conduct reviewer at the preliminary assessment stage and the outcome of those complaints

6 – No breach

The number of code of conduct complaints investigated by a conduct reviewer

7

The number of code of conduct complaints investigated by a conduct review committee

0

The outcome of investigations completed under these procedures (without identifying particular matters)

4 – Substantiated

2 – No breach

The number of matters reviewed by the Office and, without identifying particular matters, the outcome of the reviews

 

1 – Remains under review

The total cost of dealing with code of conduct complaints made about Councillors and the General Manager in the year to September, including staff costs

 

$201,232

 

3.     Council is to provide the Office with a report containing the statistics referred to in clause 11.1 within 3 months of the end of September of each year.

FINANCIAL IMPLICATIONS

4.     The total cost of dealing with Code of Conduct complaints is funded from the OGM consultants budget.

RISK IMPLICATIONS

5.     The consideration of this report ensures that Council meets the legislative compliance and statutory reporting requirements under the Procedures for the Administration of the Code of Conduct and reporting obligations to the Office of Local Government.  

COMMUNITY ENGAGEMENT

6.     No community consultation is required as a result of this report.

 

 

  


Georges River Council –      Finance and Governance Committee -  Monday, 9 November 2020                                                                                    Page 100

Item:                FIN057-20    Tender - T20/011 Supply, Installation and Ongoing Maintenance of Commercial Car Parking Equipment 

Author:            Head of Strategic Property

Directorate:     Business and Corporate Services

Matter Type:    Committee Reports

 

 

 

Recommendation:

(a)    That, under Section 178(1)(a) of the Local Government (General) Regulation 2005, Council accept the tender that is recommended for T20/011 Supply, Installation and Ongoing Maintenance of Commercial Car Parking Equipment, as outlined in the confidential attachment.

(b)    That the General Manager be authorised to sign the Contracts with the preferred Contractor on behalf of Council.

(c)    That Council inform the unsuccessful Tenderers of the resolution.

 

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 T20/011 Supply, Installation and Ongoing Maintenance of Commercial Car Parking Equipment and to seek resolution from Council on entering into a Contract with the successful Tenderer to appoint as the Principal Contractor to carry out the proposed contract works.

2.     This report explains the background and details the tender process supporting the recommendation for Council’s consideration, with the confidential matters being contained within the confidential attachments.

Background

3.     On 27 April 2020, Council via CCL021-20 adopted the (confidential) Commercial Car Parks Review that identified the need to improve the quality of parking equipment at the nominated car parks within the Georges River Council Local Government Area.  The subject car parks that relate to this tender are: Kogarah Town Square Car Park (Derby Street, Kogarah), Greenbank Street Car Park  (1D Greenbank Street, Hurstville), Woniora Gardens Car Park (Empress Lane, Hurstville) and The Avenue Car Park (7-11 The Avenue, Hurstville)

4.     Council proposes to deliver a program of works with the objective of improving the usage and amenity in selected off street car parks within the Georges River Council Local Government Area.

5.     The Council engaged a specialist consultant to carry out investigations, identify deficiencies and make recommendations to commercially improve the car parks and to prepare a subsequent technical brief.

6.     Council called for tenders on 18 August 2020, with a view to appointing a suitably qualified Principal Contractor to carry out the works under the proposed Tender T20/011.

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

TENDER PROCESS

8.     The tasks undertaken as part of the tendering process are as follows:

Tender Documents prepared and reviewed in-house, a Tender Evaluation Plan (TEP) was prepared and a Tender Evaluation Committee (TEC) appointed prior to calling/advertising of the Tender.

9.     Tender T20/011 - Supply, Installation and Ongoing Maintenance of Commercial Car Parking Equipment was advertised on 18 August 2020, on the Council’s public website and Tenderlink via an open tendering method, in accordance with clause 167 of the Local Government (General) Regulation, 2005.  

10.   The tender was advertised for a period of 21 days. Three (3) clarifications were sought during the tender period with three (3) Addenda subsequently issued. The tender closed on 9 September 2020 at 10am whereupon the Tenders were collated by the Governance Partner and released to the Tender Evaluation Committee.

11.   The tender is based on a Schedule of Prices – Lump Sum intended to appoint a Principal Contractor under the proposed Contract Number T20/011.  

12.   The Evaluation Criteria established in the tender are as follows:

a.   Compliance Assessment Criteria that are not point scored.

·   Completeness – all tender schedules are submitted

·   Annexure A – Tender Form

·   Schedule 2 – Conflict of Interest

·   Schedule 6 - Insurance

·   Schedule 10 – Qualify Management Information

·   Schedule 11 – WHS Management Information

b.   Qualitative Assessment Criteria captured in Schedule 10 – Weighted Non-Price Criteria Information are point scored. The criteria subject to scoring are;

·    Schedule 3 – Tenderer’s Structure, financial capabilities and other details

·    Schedule 4 – Tender’s experience and current workload

·    Schedule 5 - Tender’s key personnel

·    Schedule 7 – Demonstrated understanding of the key issues in delivering the Tendered Activities

·    Schedule 8 – Project Plans

·    Schedule 9 – Miscellaneous Contract Particulars

·    Schedule 12 – Financial Assessment Information

·    Schedule 13 – Council’s Economic and Social Recovery Plan

c.   Scoring of Price – Schedule 1

In accordance with the Tender Evaluation Plan, the TEC established estimates of the program of works for Supply, Installation and Ongoing Maintenance of Commercial Car Parking Equipment prior to advertising of the tender as part of the scoring procedure against which the Tendered Prices are assessed.

13.   The TEC met on 21 August 2020, to review and accept the TEP; understand the evaluation process including methodology and if necessary, declare any Conflicts of Interest. The TEC then proceeded to assess and evaluate the three (3) conforming tenders received.

14.   The TEC completed the tender assessments and the evaluation process in accordance with the requirements set out in the TEP and identified a tender that best represents value for money and therefore the most advantageous tender. The TEC also recommends the Principal Contractor for appointment under the proposed Contract Number T20/011.

15.   The TEC recommends that, under Section 178 (1) (a) of the Local Government   (General) Regulation 2005, Council accepts the tender identified as the most advantageous tender as outlined in the confidential attachments to this report.

Financial Implications

16.   Tenderers have submitted their responses as strictly “Commercial in Confidence” and requested that commercially sensitive aspects of their respective offers be discussed by Council officers, Councillors and others in closed sessions only and is not to be made public.  The Tenderers consider the information supplied is commercial in confidence and if disclosed to the public and/or to their competitors, could be damaging to their business.

17.   To be funded from the Commercial Property Reserve and is within budget allocation.

Probity

18.   Council’s Probity Advisor has confirmed that the tendering process undertaken has satisfied the legislative and statutory requirements and the intent of:

Ø the Local Government Act 1993 (NSW, Part 3, Division 1, Section 55),

Ø Local Government (General) Regulation 2005, Part 7 Tendering, Division 2, in particular Sections 167 and 170.

Ø Local Government (General) Regulation 2005, Part 7 Tendering, Division 3 Sections 173 to 178.Enterprise risk/s identified and management process applied.

19.   No further risks identified.

Community Engagement

20.   Community engagement is not required in this matter.

CONCLUSION

21.   The procurement process has complied with the relevant legislative requirements for tendering and with Council’s Procurement Policy.

22.   In accordance with the Local Government Act 1993, Section 10A subsection’s (c) and (d), it is advised that all attachments herewith be considered in closed committee because they may confer a commercial advantage on a person with whom the Council is proposing to conduct business and reveal commercial in-confidence information.

File Reference

D20/261945

 

 

 

ATTACHMENTS

Attachment 1

Confidential Attachment to the Council Report - Tender Evaluation Report - T20-011 (Confidential)

Attachment 2

Evaluation Matrix (Confidential)

 


Georges River Council –      Finance and Governance Committee -  Monday, 9 November 2020                                                                                    Page 103

Item:                FIN058-20    Tender T20/008 - Provision of Property Management Services 

Author:            Strategic Property Specialist

Directorate:     Business and Corporate Services

Matter Type:    Committee Reports

 

 

 

Recommendation:

(a)    That under Section 178 (1) (a) of the Local Government (General) Regulation 2005, Council accept the tender that is recommended for Tender T20/008 - Provision of Property Management Services as outlined in the confidential attachment.

(b)    That the General Manager be authorised to sign the Contracts with the preferred Contractor on behalf of Council.

(c)    That Council inform the unsuccessful Tenderers of the resolution.

 

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 Provision of Property Management Services and to seek a resolution from Council to accept a Tender and enter into a contract with a Tenderer to carry out the work set out in the Tender Documentation.

2.     The report explains the background so as to enable Council to enter into a contract with the recommended Tenderer. The report also details the tender process supporting the recommendation for Council’s consideration (including details of the criteria, weightings, and evaluation), with confidential matters being contained in the Tender Evaluation Matrix at Confidential Attachment 1 and the Tender Evaluation Report at Confidential Attachment 2.

Background

3.     Further to a resolution on 5 August 2015, Council entered in to a contract with Senpai Pty Ltd (trading as Sydney South Property Agents) for the provision of Property Management Services.

4.     Council called for tenders on 14 September 2020 with a view to appointing a suitably qualified Provider under a new contract. This report provides information on the tendering process undertaken, the evaluation criteria, the tender evaluation process and the outcome.

Tender Process

5.     Tender Documents including a Tender Evaluation Plan and Tender Evaluation Matrix were prepared and reviewed in-house; and a Tender Evaluation Committee appointed prior to calling/advertising of the Tender. 

6.     Tender T20/008 - Provision of Property Management Services was advertised on 14 September 2020 on the Council’s public website, Tenderlink and in the Sydney Morning Herald and The Leader via an open tendering method in accordance with clause 167 of the Local Government (General) Regulation 2005.

7.     Several clarifications were sought during the tender period and Council’s Procurement and Contracts Governance Partner issued appropriate Addenda. The tender period closed on 13 October 2020 at 10am whereupon the Tenders were collated by the Governance Partner and released to the Tender Evaluation Committee. 

8.     The Evaluation Criteria established for the Tenders are as follows:

a.     A Compliance Assessment Criterion that is not point scored:

Completeness – Tenderers are required to submit all Tender Schedules, being:

·        Schedule 1 – Pricing

·        Schedule 2 – Conflict of Interest

·        Schedule 3 – Tenderer's structure, financial capabilities and other details

·        Schedule 4 – Tenderer's experience

·        Schedule 5 – Tenderer's key personnel

·        Schedule 6 – Insurance

·        Schedule 7 – Demonstrated understand of the key issues in delivering the

 Tendered Activities

·        Schedule 8 – Project Plans (not used)

·        Schedule 9 – Miscellaneous Contract Particulars

·        Schedule 10 – Program (not used)

·        Schedule 11 – Provisional Allowances (not used)

·        Schedule 12 – Nominated Alternative Tenders (not used)

·        Schedule 13 – Optional Additional Work (not used)

·        Schedule 14 – Quality Management Information (not used)

·        Schedule 15 – WHS Management Information (not used)

·        Schedule 16 – Environmental Management Information (not used)

·        Schedule 17 – Financial Assessment Information

·        Schedule 18 – Council’s Economic and Social Recovery Plan

b.     Qualitative Weighted Non-Price Criteria captured across the Tender Schedules that are point scored:

·        Demonstrated expertise in managing a diverse range of properties including Commercial offices, retail, industrial, road leases and ground leases

·        At least 5 years’ experience in managing a Local Government Authority commercial property portfolio

·        Demonstrated experience in Facilities Management including Building Management Systems

·        Local Knowledge and Presence

c.      A Price Criterion

9.     The Tender Evaluation Committee met on 23 October 2020 to review and accept the Tender Evaluation Plan; understand the evaluation process including methodology and if necessary, declare any conflicts of interest having been made aware of the identities of the Tenderers. The Committee then proceeded to assess and evaluate the five Tenders received.

10.   The Tender Evaluation Committee completed the tender assessments and the evaluation process in accordance with the requirements set out in the Tender Evaluation Plan and identified the best tender. The evaluation process produced the completed Tender Evaluation Matrix contained within Confidential Attachment 1 – Tender Evaluation Report.

11.   The Tender Evaluation Committee recommends the tender as per Confidential Attachment 1 – Tender Evaluation Report.

FINANCIAL IMPLICATIONS

12.   The price element of the recommended tender is based on a percentage of variable income and a number of potential additional items. The Tender Evaluation Committee’s estimate of the likely total outlay is contained within Confidential Attachment 1 – Tender Evaluation Report.

OTHER STAFF COMMENTS

13.   Council’s Procurement and Contracts Governance Partner advises that the tendering process has satisfied the legislative and statutory requirements and the intent of:

·        The Local Government Act 1993 (NSW, Part 3, Division 1, Section 55)

·        Local Government (General) Regulation 2005, Part 7 Tendering, Division 2, in particular Sections 167 and 170

·        Local Government (General) Regulation 2005, Part 7 Tendering, Division 3 Sections 173 to 178

Community Engagement

14.   Community engagement is not required in this matter.

CONCLUSION

15.   The procurement process has complied with the relevant legislative requirements for tendering and with Council’s Procurement Policy.

16.   In accordance with the Local Government Act 1993, Section 10A sub-sections (c) and (d), it is advised that any discussions relating to the Confidential Attachment 1- Tender Evaluation Report is to occur in closed committee as it may confer a commercial advantage on a person with whom the Council is proposing to conduct business with and reveal commercial in-confidence information.

File Reference

T20/008

 

 

ATTACHMENTS

Attachment 1

ATTACHMENT TO F&G COMMITTEE REPORT - 9 November 2020 - Tender Report T20/008 - Confidential Attachments (Confidential)

 


Georges River Council –      Finance and Governance Committee -  Monday, 9 November 2020                                                                                    Page 105

Item:                FIN059-20    Profit and Loss Statements - Premium and Community Leases 

Author:            Chief Financial Officer

Directorate:     Business and Corporate Services

Matter Type:    Committee Reports

 

 

 

Recommendation:

That Council receives and notes the information contained in the report.

 

Executive Summary

1.     The report contains the Profit and Loss Statements for the Financial Year 2018/2019  and 2019/20 for several of Council’s premium and community venues; Hurstville Aquatic Leisure Centre, Netstrata Jubilee Stadium, Hurstville Oval, Marana Auditorium and Civic Theatre.

Background

2.     At a recent Finance and Governance Committee meeting, Councillors requested Profit and Loss Statements for the Financial Year 2018/2019 on the following venues; Hurstville Aquatic Leisure Centre, Netstrata Jubilee Stadium, Hurstville Oval, Marana Auditorium and Civic Theatre.

3.     Also included are the Profit and Loss Statements for the Financial Year 2019/2020 for the same venues to provide an informed financial summary to Council of the financial impact of COVID-19 on the operation of these venues.

4.     The results of 2019/20 highlight that income declined by $1.4m from the prior year with the material reduction in Hurstville Aquatic Leisure Centre and Netstrata Jubilee Stadium. Subsidies provided to community organisations for the Marana in 2019/20 were $37,023.

Financial Implications

5.     No budget impact as a result of this report.

Risk Implications

6.     It should be noted that accounting structures and cost allocations change each year to best reflect the true financial position of services and sites of Council. It is important to note these changes when making comparisons to previous years.

Community Engagement

7.     No community engagement will occur as a result of this report.

File Reference

D20/270265

 

ATTACHMENTS

Attachment 1

Profit and Loss - Select Sites

 


Georges River Council -            Finance and Governance Committee - Monday, 9 November 2020

FIN059-20               Profit and Loss Statements - Premium and Community Leases

[Appendix 1]           Profit and Loss - Select Sites

 

 

Page 107

 


 


Georges River Council –      Finance and Governance Committee -  Monday, 9 November 2020                                                                                    Page 109

Item:                FIN060-20    Property Matter - Commercial Property Portfolio - 2020/21 First Quarter Report 

Author:            Strategic Property Specialist

Directorate:     Business and Corporate Services

Matter Type:    Committee Reports

 

 

 

Recommendation:

That Council receives and notes the Commercial Property Portfolio – 2020/21 First Quarter Report.

 

Executive Summary

1.     At the Council meeting held on 1 May 2017, Council resolved to receive a regular report on the Commercial Property Portfolio and other associated leases and licences.

Background

2.     The report presented to Council includes information on the commercial properties within the Commercial Property Portfolio including commercial car parking.

3.     The report is an evolving document and responds to the ongoing audit of Council’s commercial leases and licences and the execution of new leases and licences.

4.     The table below shows the performance of the portfolio for Q1 of the 2020/21 financial year. 

Property Type

Number of Properties

No. of Current Vacant Premises

Q1 Net Income to 30/09/20 Actual

Q1 Net Income to 30/09/20 Budget

Variance

 

Comments

Commercial

71

5

$714,490

$728,322

$13,832

(deficit)

Result under budget (1.9%) due to vacancies and rentals being waived for COVID-19 tenant assistance.

Retail

8

1

$69,830

$74,752

$4,922

(deficit)

Result under budget (6.6%) due to vacancy and rentals being waived for COVID-19 tenant assistance.

Commercial Car Parks

4

0

$17,598

$45,000

$27,402

(deficit)

Effects of COVID-19 impacting income.

Footway Trading

NA

NA

$7,697

$18,750

$11,053

(deficit)

Impact from Covid-19 as user charges presently being waived. Income received is for applications only

Outdoor Furniture Advertising

4

0

$40,094

$53,750

$13,656

(deficit)

Variation due to reduced advertising income.

Telecommunications

4

0

$29,307

$20,975

$8,432

surplus

Timing only, as income for full year received from The Greens Kyle Bay.

Total Income

91

6

$879,016

$941,449

$62,443

(deficit)

 

5.     There are currently six vacancies across the portfolio.

Financial Implications

6.     Budget variations are briefly explained in the table above. Budget shortfalls are predominantly the result of reduced car parking revenues due to decreased patronage associated with the COVID-19 pandemic and higher than expected maintenance costs associated with the commercial properties maintenance program.

7.     Some of the deficits recorded are as a result from rent relief granted to commercial tenants as a consequence of the COVID-19 pandemic and pursuant to the Federal Government’s mandated Code of Conduct in relation to small-medium sized business. The subject rent relief provided by Council affected 10 tenancies, totalling in the order of $70,000 over the reporting period.  It should be noted, however, that that approximately 60% of this amount is intended to be collected over future reporting periods.

Risk Implications

8.     Council’s losses arising due to the COVID-19 pandemic have been reported monthly.  The risk of tenants being unable to continue trading in the current environment and bleak economic outlook remains high.

Community Engagement

9.     No community engagement is required for this matter.

File Reference

D20/210923

 

 

 

  


Georges River Council –      Finance and Governance Committee -  Monday, 9 November 2020                                                                                    Page 112

Item:                FIN061-20    Property Matter - Street Name Sign Advertisements ("Identilites") - Proposed New Contract 

Author:            Strategic Property Specialist

Directorate:     Business and Corporate Services

Matter Type:    Committee Reports

 

 

 

RECOMMENDATION:

(a)    That Council enters into a contract for the creation and display of advertisements (“Identilites”) on street name signs throughout the entire Georges River Local Government Area on the terms outlined in the attached (confidential) Proposed Contract Advice.

(b)    That Council authorises the General Manager to execute the contract and all associated documentation.

 

ADDITIONAL INFORMATION

1.     At the Council meeting held on 26 October 2020, it was resolved that the report item FIN050-20 be deferred to the next scheduled Finance and Governance Committee Meeting. The purpose of the deferral was due to Council seeking additional information in regard to this proposal, details of which are now provided.

2.     The main concern raised was in relation to the possibility of an over-proliferation of Identilites if Council was to enter the contract as recommended. Officers indicated that it was anticipated that the constraint on over-proliferation would occur via planning controls, in that, as per preliminary advice received from Council’s Planning Directorate, each proposed site would need to be the subject of a Development Application.

3.     Council requested further information in this regard and in particular asked whether it was possible that the proposed contracted party could apply for and receive a “bulk” Development Consent that would allow for an unlimited number of sites.

4.     Council’s Planning Directorate has advised the following in this regard:

·        We have reviewed the current DCP controls for both Hurstville & Kogarah, and it seems that all proposals for illuminated signage need DA approval.

·        Bulk approval cannot be granted and as such each site is required to have a separate application and assessed accordingly.

5.     The proposed contracted party was advised of Council’s concerns and provided its own view of the situation insofar as planning controls is concerned. In its opinion and as per its operations with other New South Wales councils, new sites are permitted under and subject to the restrictions of State Environmental Planning Policy No. 64-Advertising and Signage (“SEPP 64”).

6.     The proposed contracted party further advised that in its operations with other councils, it ensures that proposals for individual sites comply with SEPP64 before submitting them for approval under the terms of the contract i.e. to the contract supervisor rather than to the Council’s Planning Directorate.

7.     The proposed contracted party’s advice was forwarded to Council’s Planning Directorate who supplied the following comments which comments as follows:

·        SEPP exempt controls – do not allow illuminated signage.

·        SEPP Infrastructure – will allow maintenance, replacement or change in display if existing sign is exempt under this policy – It must not involve a change in area, form or shape and the fact that illumination is not exempt then this is also not permissible.

·        SEPP 64 - This would also require assessment and approval, taking into account the following controls (The controls are shown in Attachment 3).

8.     There’s clearly some divergence of opinion between Council’s Planning Directorate and the proposed contracted party. However, it is submitted that a combination of planning controls and well considered contract terms will ensure no over-proliferation of Identilites will occur should Council enter the contract as recommended. In particular, it is emphasised that each individual proposed site will require consent from Council.

EXECUTIVE SUMMARY

9.     Council currently has a contract with Claude Outdoor Pty Ltd (“Claude”) that allows Claude to display Identilites at 13 sites previously created under the contract within the former Kogarah City Council local government area. The contract has been held-over on a quarterly basis since 30 June 2020.    

10.   On 26 March 2018, Council resolved the following:

That a formal Expression of Interest process be undertaken in July 2020 for the provision of Illuminated Street and Transport Shelter advertising signage across the Georges River LGA.

11.   This report details the actions taken in regards to that Resolution and recommends Council enters into a Contract for the creation and display of Street advertising signage (Identilites).

BACKGROUND

12.   In 1992, the former Kogarah City Council entered into an agreement to allow Claude Outdoor Pty Ltd (as the company is now called) to erect and display Identilites within the local government area. The agreement commenced on 1 January 1992. An example of a current Identilite is shown in Attachment 1.

13.   The agreement specified a fixed annual fee for each site (comprising 2 Identilites) that was to be paid by Claude to Kogarah City Council. The agreement had an original term of 10 years, with a 5 year option which Claude exercised, taking the agreement up to 31 December 2006.

14.   The two parties then entered a further 5 year agreement on similar terms.

15.   That agreement continued on a hold over basis until August 2015, at which time, Kogarah City Council confirmed that the holdover period could continue until 31 December 2017 at a new fixed annual fee. This was on the proviso that Claude would not increase the number of sites - being 13 - during the holdover period.

16.   In December 2017, a report was presented to Council noting that Claude was seeking to enter into a new agreement that would cover the whole of the newly formed Georges River Council Local Government Area.

17.   During the Committee discussion at the time, concern was raised that the former Hurstville City Council’s agreement with AdShel (now Ooh Media) for advertising signage on transport (bus) shelters may inhibit the EOI process. It was noted that the agreement with Ooh Media prevented Council from permitting anyone other than Ooh Media to deliver, display or make available any advertisements in any format on or from any Street Furniture in the Council Area, if those advertisements are within the prescribed sizes and configurations. It was concluded that this meant that Council could not enter into an agreement for the provision of Identilites within the former Hurstville City Council area.

18.   Ooh Media also had (and still has) a separate agreement for advertising signage on transport shelters within the former Kogarah City Council area (within which Claude operates), that also contains an exclusivity clause.

19.   The former Hurstville City Council’s agreement with Ooh Media has now expired and is in holdover on a quarter by quarter basis. Therefore, the exclusivity clause can be deleted at any time.

20.   Claude was advised of the Council resolution of 26 March 2018 and that the agreement that terminated on 31 December 2017 would be allowed to holdover to 30 June 2020, (to match the contractual expiry date of the bus shelter advertising agreement with Ooh Media) thereby extending Claude’s “tenure” to some 28 ½ years.

21.   Further to the Council resolution, Officers appointed an Advertising Consultant in late 2019 and began detailed investigations in regard to the state of the market, prior to calling for Expressions of Interest. The result of those investigations and subsequent negotiations are set out in the (confidential) Proposed Contract Advice in Attachment 2.

FINANCIAL IMPLICATIONS

22.   If Council enters the proposed contract, it will receive income in accordance with the terms set out in the confidential Proposed Contract Advice in Attachment 2.

RISK IMPLICATIONS

23.   No risks identified.

COMMUNITY ENGAGEMENT

24.   No community engagement is required as a result of this report.

FILE REFERENCE

Q19/301

 

 

 

ATTACHMENTS

Attachment 1

Example of Identilite

Attachment 2

Proposed Contract Advice (Confidential)

Attachment 3

SEPP64 Controls

 


Georges River Council -            Finance and Governance Committee - Monday, 9 November 2020

FIN061-20               Property Matter - Street Name Sign Advertisements ("Identilites") - Proposed New Contract

[Appendix 1]           Example of Identilite

 

 

Page 113

 


Georges River Council -            Finance and Governance Committee - Monday, 9 November 2020

FIN061-20               Property Matter - Street Name Sign Advertisements ("Identilites") - Proposed New Contract

[Appendix 3]           SEPP64 Controls

 

 

Page 115