Te Puke Recreation and Aquatic Centre Feasibility Study

Appendix 3 Key Questions Relating to the Proposed Facility DevelopmentsIt is considered likely that the following two key questions may be raised by stakeholders as the projectcontinues into its next phase.Question 1:Can the proposed facility be developed more cheaply?Yes – the proposed facility could be developed more cheaply than the high level costs identified within thereport. However, it should be noted that with the reductions in the overall capital costs will come potentialimplications that should be considered.One way in which costs could be reduced is to reduce the components that are retained within the facility (ashas been identified within the report). Key components such as NOT having the movable floor would save onthe capital costs. However, the impact would be a reduced service level to the community. Without a movablefloor the pool could not accommodate BOTH recreational and learn to swim activities, and deep water aquaticopportunities like water polo.Other areas in which you could reduce costs could be to not develop the proposed fitness gym ormultipurpose meeting space. This could reduce the size of the building and reduce the capital costs.However, this would have a negative impact on the operational aspect of the proposed facility. Taking out keyareas such as the fitness gym or multipurpose meeting space would reduce the potential income streamswhich could then require a potentially greater subsidy from the partners. This would also reduce theopportunity for the community to access a range of local recreation opportunitiesThe proposed facility development could also reduce the capital costs by reducing the quality of material used.The current estimate of costs has been based on a ‘medium cost’ specification of material for the building. Theproposed facility could be developed using a lower specification of materials which could reduce the capitalcosts.However, previous experience has shown that the use of low cost (and quality) specification of materials haslead to an increase in maintenance and replacement costs and as a result increased the ongoing operationalcosts of facilities.Another alternative would be to develop only one component of the facility such as an indoor or outdoor pooland then develop a simpler School gymnasium which would meet the needs of the school predominantly. Thetrade off is that this would reduce or exclude wider community use for much of the time.Question 2:Can the proposed facility be developed by Loan Funding?Yes – the proposed facility could be developed with assistance from loan funding. However, it should be notedthat the ability for the facility to repay the loan would be an issue that would need to be examined in moredetail.Most facilities of this nature require an annual financial operational subsidy to be viable. Therefore it wouldbe likely that there would be no additional financial surplus to assist in paying the loan component. Anincrease in an operational subsidy could be required to meet the loan funding.A loan funding model could also take away from the ability to reinvest in the facility in terms of capitalimprovements and programmes; since the focus would be on repaying the loan amount.