TRY, TRY AGAIN

Bye bye $625,000.00

It could be an hours homework that may just end up with a positive result.

As of October 17, 2015, the new Shire of York Council must be given all information, from all sources, regarding any financial problems it faces in the foreseeable future.

The sale of the Old Convent School will not be reversed. The intention of this kind of letter is to try and ensure that the undemocratic processes and lack of fiscal accountability used in this purchase, by Commissioner James Best, do not occur again.

In the previous correspondence of August 31, 2015, the term WA Treasury was used to cover all bases as to where government money comes from. The Auditor General, Colin Murphy, is ultimately responsible for the proper use of State Government monies.

It is the WA Treasury Corporation that dispenses what is called ‘surplus State Government funds’, as loans, apparently at the lowest interest rate- being the RBA’s Cash Rate of 2 per cent.( I thank Anonymous who suggests the term of the loan is ten years.)

Unfortunately our credit- strapped, State Government, does not have surplus State Government funds as St. John ambulances’ ramp-up, Fiona Stanley Hospital goes into melt-down and it tries to flog-off the Fremantle Port facility.

Mr Colin Murphy’s job is to ensure that Royalties for Regions and other government monies are not used for financial faux pas.

Obviously the historic Old Convent School must be preserved at any cost. But this ‘any cost’
(and what it will be used for) is what the majority of the York population decides it should be. Certainly not a decision made by some single, non-representative, local government administration, political appointee.

Mr. Murphy should respond to this, he has in the past, but not with ambiguous political rhetoric! Our dispute is what constitutes State Government, monies, funds, loans etc., surplus or otherwise, what is officially considered as misuse and who should be held accountable for such.

As of October 17, 2015, if re-elected as Shire President, it should be Councillor Matthew Reid’s objective and responsibility to stir this kind of possum and try to ‘keep the bastards honest”-not mine and the many others who have made public statements referring to what they genuinely believe was, and is, in the best interest of York as a whole.

DAVID TAYLOR

Mr. Colin Murphy                                                                 Dated September 17, 2015
Auditor General for Western Australia
Office of the Auditor General
7^th Floor Albert Facey House
469 Wellington Street
PERTH WA 6000

Dear Mr. Murphy

RE: SALE OF THE YORK CONVENT TO THE SHIRE OF YORK COMMISSIONER 
MR. JAMES BEST and THE NEW SHIRE OF YORK COUNCIL OCTOBER 17, 2015.

On August 31, 2015, I wrote to you claiming that the purchase of the commercial property, Lots 800-801, South Street, being the historic Old Convent School building and surrounds, circa 1873, was facilitated by a loan issued by the WA Treasury (Corporation) (WATC) to Commissioner James Best, the Shire of York, at his (personal) request.

The borrowing was believed to be for the full amount of the inflated purchase price being $625,000, with the Principle & Interest repayment for the Financial Year, 2015-2016, set at $72,000.

As previously stated, in the absence of publically accessible financial data, I assumed the loan was for fifteen (15) years at a commercial interest rate of five (5) per cent with the total repayment being $1,080,000. This was based on current, standard commercial interest rates, over a reasonable term.

I have since been advised that the term of the loan is ten (10) years. Without knowing the terms and conditions of this loan, given the regular annual repayment (P & I) is allegedly $72,000, the total repayment could be $750,000 with $125,000 being the interest repayment component.

The current Reserve Bank of Australia (RBA) Cash Rate is two (2) per cent and is designed to positively influence the term structure of interest rates across the whole Australian economy, to stimulate the economy, in the best interest of the economy, not to promote government lending to local government agency borrowers using government (tax- payers’) money at some risk, without a clearly defined, productive result.

It would appear that the WATC has seen fit to provide ‘surplus State Government funds’ to Mr. Best, as the Shire of York, without commercial justification, any, known, economic rationale and local community expectations evaluation, at an interest rate comparable to the RBA’s Cash Rate and well below both home loan and, in particular, commercial interest rates.

The WATC’s mandate is the investment of State surplus funds which is ‘State Government monies’ and its use is under your jurisdiction and scrutiny. The WATC also avows to provide ‘sound financial risk management’ and ‘debt interest rate risk management’ which is a contradiction in terms when applied to the reasons for the loan issued to, Commissioner Best- that is under your jurisdiction.

Prior to the end of his contract, the Shire of York (James Best) was allowed to increase local shire property rates by thirteen-and-a-half (13.5) per cent for the Financial Year 2015-2016 in an attempt to, belatedly, provide future financial viability and sustainability to the Shire, while desperately trying to cover existing debt. (This may well the highest rate hike in the history of local government in this state.)

At the same time the WATC provided the additional, substantial financial debt burden to theYork ratepayer and the community at large to the tune of $625,000, plus interest, without enacting due diligence and financial duty-of-care, through the provision of a loan for the public purchase of a private, commercial property without a valid reason.

Although the interest rate payable may be low, the sound financial risk management and the debt interest rate risk management parameters attached to this loan, in comparison to the return in any community value expectations, are ill advised.

It should be once again noted that the whereabouts, content, relevance, reliability, quality and objective reason for any documents pertaining to a review of a York planning strategy, directly relating to the appropriate development of a village square, or town centre, incorporating the historic, Old Convent School building, is not known to (and approved by) the York ratepayer .

There has been no proper, appropriate and necessary community consultation regarding any Shire expenditure required to be invested in such a project- up to this point in time.

It is my opinion that, despite the historic significance of the property, the WATC has provided an unwarranted, excessive loan to be paid for by the ratepayers of York at the inappropriate, unsubstantiated request of Commissioner James Best. It has been delivered in a commercially irresponsible manner, with no proper probity assessment and justification as it being in the community of York interest.

As of October 17, 2015, the Shire of York will have a new council. This duly elected Council should take office armed with the knowledge of your assessment of the validity of the loan as Auditor General, and your intentions with regard to its future implementation. You are independent of the State Government and as such should deliver your adjudication to the current President, Matthew Reid, prior to the election date.

It is not the loan itself or the obvious historic, non- commercial, value of the property concerned- it is why it was borrowed?  why so much was borrowed? why it was lent and was the loan obtained under false pretences and through mal- administration?

This is what the new Shire of York council and the community of York deserves to know at your earliest convenience.

Yours sincerely

David Taylor.
Shire of York ratepayer