GRIFFITH City Council’s financial sustainability has been thrown into question after an external report found development applications were 60 per cent below the group average.
Council came under fire last month after it was revealed two major developers had taken their business elsewhere due to Griffith’s Section 94A requirement, which necessitates investors to pay a 1 per cent levy to council.
The NSW Treasury Corporation (TCorp) report on financial sustainability of the NSW local government sector for 2011-2012 showed the value of development applications (DA) in Griffith stood at $31.86 million, while the group average for similar sized local government areas was $82.33 million.
The report also indicated Griffith’s financial sustainability rating was “sound with a negative outlook”.
Griffith City Council general manager Brett Stonestreet said in terms of the sustainability rating, he was “reasonably pleased”, given only 23 per cent of local government areas across the state received a sound or better rating.
He said council’s restructure and financial outlook had actually improved since the data was collated, which could influence the negative outlook.
However, Mr Stonestreet said the DA values were “disappointing”.
“It does effect the economic activity that is happening in the city but that is turning around and it’s going to take some time,” Mr Stonestreet said.
“All the community leaders in Griffith need to be looking at the positive aspects of the city going forward and really emphasise these.”
The results have alarmed Griffith Business Chamber president Paul Pierotti, who claims council needs to rapidly reign in its spending and make the DA process more attractive to potential investors.
He has urged council not to commit to any further spending until an external audit is completed in March next year.
“The TCorp assessment of council’s financial sustainability as sound with a negative outlook reinforces what we’ve been saying for years,” Mr Pierotti said.
“Council needs to review future processes and spending so it doesn’t have a negative outlook.
“It really reinforces that council needs to immediately review the whole DA process and remove completely Section 94A.”
Council is currently investigating this requirement with the possibility of amending it.