Is That Grant Dollar Worth It?

I have long argued, that in many cases, the answer to that question is “no”. As a council we apply for grants for many reasons. In some cases, it assists in the delivery of essential items.

It is the “other cases” I wish to speak about.

Most grants involve only partial funding of any given project. The example being, that if we are the recipients of a grant of $5 million to build a “something”, on the surface it sounds great. The problem is that we have already spent close enough to a million on a business case and design etc.

Still sounds ok, spend a million to get five? Well, woah back, we usually must match the grant dollar for dollar. So, spending 6 to get 5 does not sound quite as good, does it?

Well, the bad news continues. Any cost overruns are our responsibility and currently some of these overruns can be nearly twice the initial forecast! But for this exercise let’s say the overrun stands at 20 per cent or around $2 million. Now we have the situation where we are up for $8 million to secure the offered $5 million.

Now where the real kicker on this whole exercise comes in, is in maintenance and depreciation. Opening a shiny new “something” that has cost $13 million provides a wonderful opportunity for those that thrive on media opportunities.

However, it saddles us with the unenviable task of covering the cost of maintaining and depreciating that “something” every year for many years to come, not to mention the running cost – and that is wholly funded by your rates - maybe to the tune of hundreds of thousands.

While I in no way am suggesting that we do not apply for grant funding, we would do well to realise that all dollars are not created equal.

Dollars for essentials are great dollars.

Dollars for discretionary projects are dubious dollars indeed.

Coupled with this is the fact that many of our assets are decades old – many decades. These are often things you cannot see. Sewers, storm water lines, water services and more.

Renewal of these is essential or we become third world. Running to failure is NOT a desirable option as repairs in this case cost multiples of what planned maintenance costs.

Now call me conservative, but for me, uninterrupted services are more important than cutting ribbons.

Cr Martin Bella

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