IT is over time and over budget, now the official handover of MidCoast Council's new Forster library precinct has been delayed even further due to safety concerns in the car park at the unfinished building site.
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The $80 million public-private partnership was touted as going to revitalise Forster CBD, but since being approved in 2017 it's been dogged by criticism it's a bad financial deal for ratepayers and claims that tradies haven't been paid.
The Solaris project, which houses council's Forster Civic Precinct, was initially sold as going to deliver 139 seniors apartments, a new five-star hotel, nightclub, cinemas, supermarket and council library.
But six years on, the development on 12,000 square metres of prime land in the heart of Forster, which was purchased by council in 2014 for $3 million and handed over to the developer several years later when it was valued at $6 million, has undergone significant changes.
In mid-2021, 53 retirement village units and a residents' clubhouse planned for stage one were scrapped, replaced by residential apartments and commercial space to be built and sold by the developer Coyne Graham's Enyoc Pty Ltd.
Mr Graham is a prominent National Party member, who was elected Lyne Federal Electorate Council treasurer in August. His company Enyoc Pty Ltd, stands for Coyne spelt backwards.
Under the original plans, the library precinct was due for completion in 2020, but it is still not finished following repeated delays, blamed by Enyoc on the pandemic causing problems in securing funding and shutdowns restricting the work of building contractors.
Councillor Peter Epov, a vocal critic of the Lake Street development, said it made "no commercial sense since the beginning" and was "not a fair or balanced deal" for ratepayers.
"I would not describe the project as good value for money," Cr Epov said.
"As a small council that is struggling financially, I believe we should have had greater equity in the project and a far better return for ratepayers than we do."
The library project initially attracted $6 million in federal funding and another $6 million from the council, plus the council handed over the land - estimated to be worth $6 million - to Enyoc as part of the deal.
Enyoc agreed to invest $3.3 million in works plus $2.7 million in cash, due in November, to secure the site and its rich redevelopment potential.
The official cost to council has varied widely over the years, along with the makeup of the development and completion dates.
In August 2017, council signed a "fixed price" contract with the developer for $15.3 million for delivery of a "warm shell" library precinct.
Council now says the project will cost $17.4 million for design and construction, plus $3.5 million for furniture and fit-out, after an additional $2.1 million in construction costs, or variations, was added to the project, bringing the total to $20.9 million.
Cr Epov said this did not account for council handing over ownership of the land to the developer, or the fact that the deal gives Enyoc 30,000 square metres of commercial and residential space to sell.
Despite regularly raising questions about council's "extraordinary level of support" for the development, Cr Epov said there were no clear answers.
He wants to know why council handed over the full $12 million in government funding to Enyoc before the project was completed, including advancing its own money against the $6 million federal government grant, and why it provided $1 million in reduced costs for Enyoc, including $220,000 less in developer contributions.
"Council would have been far better off building the library itself and having the benefit of the remaining 9000 square metres for a proper civic precinct," Cr Epov said.
"Now we have 3000 square metres at the bottom of an apartment building and no civic centre."
Last month, Craig Walker - a tradie who did excavation work on the site - went public on Facebook claiming he was owed about $8500.
The Herald understands there are other subcontractors also owed money from work done on the site.
Council declined to answer questions about the development this week, instead issuing a public statement on its website.
It said progress on the development, including the financials, had been reported on a monthly basis to the elected councillors and the community, and council general manager Adrian Panuccio said he welcomed any investigation into the project.
"Our focus is on delivering the services to the community we have committed to from the start of this project," Mr Panuccio said.
The statement went on to detail how council was aware of claims that subcontractors had not been paid.
"There has been media interest in the development following social media campaigns from subcontractors who have not been paid for their work on the building," it reads.
"MidCoast Council is not associated with any non-payments. Those who have not been paid were sub-contracted to a contractor to the builder employed by the developer."
The Newcastle Herald reported in April 2021, that in a confidential briefing to councillors, a copy of which was leaked to members of the community, the council's corporate services director, Steve Embry, said the coronavirus pandemic had "adversely affected" the developer's "proposed investors financial arrangements".
"Of immediate concern is that Enyoc have works completed on site by contractors which remain outstanding and they do not have the funds to meet these commitments," Mr Embry wrote.
"Amounts are due at the end of April and May totalling $2.1 million."
A spokesman for Enyoc said on Thursday that at the end of August it had fulfilled its financial commitments to more than 150 subcontractors and suppliers.
"A handful are currently finalising their handover and defects process, and we're poised to settle their dues immediately upon completion," he said.
"It's pertinent to note that the primary individual fueling these allegations is not a creditor of Enyoc, but is rather a ... subcontractor grappling with financial challenges tied to another entity that faced liquidation."
Enyoc's spokesman said the increased cost of council's library precinct was due to agreed variations to the original works, and the developer had absorbed significant construction material price increases since the project began, which had not been passed onto the council.
Council was due to take possession of the site last week, but a mechanical issue with an exhaust fan in the car park caused safety concerns and further delays.
The library precinct is expected to be opened on October 9, about three years after it's initial planned finish date.
Former Taree mayor Paul Hogan, a retired construction industry veteran, has reported his concerns about the development to the Independent Commission Against Corruption (ICAC).
The 80-year-old said while he "fully supports" Forster getting a new library precinct, over the years council information about the project had appeared anonymously in his letterbox, which raised some "serious concerns".
Mr Hogan said it was "not very often" councils enter into joint ventures with developers, and he believed the private-public partnership setup required "more transparency to ensure due process".
He said there were repeated concerns from tradies about not being paid and talk about deals being done by some to accept apartments in the complex in lieu of being paid.
"To me it's an issue about the process," he said.
"I know a lot of the tradies from my time in construction and they would tell me what's going on and these documents would appear in my letterbox, and I started to think that there just needs to be more transparency. I'm questioning what is going on here."
Mr Hogan said it was council's job to put the interests of its ratepayers first and he could not understand why it had provided such strong support for Enyoc throughout the development.
A document dropped in his letterbox revealed the "financial assessment information" required by council from Enyoc, which Mr Hogan described as "very thin".
He also questioned the additional $2.1 million in variations charged to council, including painting for 4000 square metres when the library precinct is only 3000 square metres.
"I'm all about honesty and integrity, and I believe that transparency has been missing all the way along," he said.
"There has not been enough information provided by the council, it's no good hiding behind confidentiality, there could be good reasons for things but the community deserves the answers. My concern is that there have been decisions made that might not have been in the best interest of the community."
The initial deal with Enyoc was signed in August 2017 by then council administrator John Turner and former general manager Glenn Handford.
This took place a month before the first election of councillors to MidCoast Council following an amalgamation of Gloucester Shire, Great Lakes and City of Greater Taree councils.
Mr Handford resigned from his council post in December that year and later began working as a consultant for controversial Sydney developer and Tea Gardens land owner Phillip Dong Fang Lee.
Enyoc's spokesman said the builder was addressing minor defects associated with stage one after residents started moving into apartments last month.
Stage two of the four-tower project includes further foundation works, retail space and the first retirement-living tower with 60 apartments.
Do you know more? Donna.page@newcastleherald.com.au
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