DROWNING in debt, the New England Regional Indoor Sporting Complex has been handed a lifeline.
$189,455.91 in outstanding debt has been reduced to $150,000 by Armidale Regional Council to save the facility.
Council’s group leader of organisational services Lindsay Woodland said the loan was provided to NERISC in 2005, but the complex was unable to keep up with repayments.
We’re reluctant to write off that amount of debt, Council has paid out the $300,000 loan so we’re not incurring any additional costs.
“The loan was provided on the basis of the construction of Stage 1 of The Den in the facility,” he said.
“It’s fair to say they have made efforts over time to reduce their debt and in the past 11 years they’ve repaid some $213,435.”
In the original agreement made by Armidale Dumaresq Council, the complex was expected to pay back $30,855 a year for the next 14 years.
But, NERISC only makes an average of $30,000 per year – not enough to cover the cost of the loan repayment and ongoing maintenance.
“The debt now actually stands at $189,455 and they [NERISC] have asked to write off that debt,” Mr Woodland said.
“We’re reluctant to write off that amount of debt, Council has paid out the $300,000 loan so we’re not incurring any additional costs.
“Our solution is to write off the interest charges, that will bring the debt back from $189,455.91 to $150,000 – and we would reset the payment schedule to $10,000 per annum over a 15 year period.”
Council has repaid the original loan to the bank and has incurred the interest costs in prior financial years.
At this point Council is not incurring any additional costs and is generating small interest revenues that are only adding to the debt.
Another sporting group has also been given a loan and is expected to come forward with a similar write-off request.
The decision to write off the interest charge debt was made in a meeting of Council on April 12.