Opponents of Skydive the Beach say Wollongong ratepayers have missed out on ‘‘several million dollars’’ from the successful company because the council is not charging enough to allow skydivers to land in Stuart Park.
Speaking at a Wollongong City Council meeting on Monday, resident John Riggall pointed out the company’s agreement with Port Phillip council, in Victoria, where it pays more than $125,000 a year for the right to land in a park on the St Kilda foreshore.
This is in stark contrast to the $7793 it pays Wollongong council to land in both Stuart and Dalton parks.
The debate about the company’s use of public land has been reignited in the past two weeks, after it revealed plans to list on the stock exchange and raise up to $20 million by selling new shares.
On Monday night, independent councillor Greg Petty raised a motion asking the council to gain a government valuation for Stuart Park and call for competitive tenders for the use of the Wollongong drop zones.
Councillors did not debate the motion and voted to let it ‘‘lie on the table’’, as a report on the lease of Stuart Park is due to be presented to the council in April.
However, Mr Riggall, along with another speaker Stephen Spencer, used the council’s public access forum to call for Wollongong to launch its own competitive tender process and get a better deal for the city’s ratepayers.
According to Skydive the Beach’s prospectus for would-be investors, one of its subsidiaries has a tour operator licence from the City of Port Philip Council, with a current annual licence fee of $122,500.
‘‘In addition Skydive Holdings Pty Ltd must pay a fee of currently $2.40 per jump for adult customers and $1.60 per jump for child customers,’’ the prospectus says.
Business papers from Port Phillip council confirm this agreement, detailing a competitive tender process from 2010 where two companies had to bid for the use of the foreshore drop zones.
Skydive the Beach outbid the another business, Melbourne Skydive, by proposing to pay $25 per person per jump to land in Moran Reserve, Ellwood.
The company says it lands about 5000 times in St Kilda, whereas in Wollongong, there are about 19,000 landings a year.
If the $25 per person fee was applied in Wollongong, that would yield council fees of about $475,000 a year.
The Mercury asked the council why a competitive tender process had not been applied to the Stuart and Dalton Park landing zones, and how it decided on the $7793 licence fee, as well as if it planned to allow expressions of interest for the permits, but did not receive a response by the paper’s deadline.
Over the past two years, Skydive the Beach has been negotiating with the council for permission to build a new administration building in Stuart Park, to replace its ageing cottage headquarters which was proposed to be demolished under the Blue Mile plan.
In January, the council’s Independent Hearing and Assessment Panel recommended the building be given approval, subject to conditions, and the council is now in the process of negotiating with the company over the lease of the building site.
On Monday night, more than two dozen Skydive the Beach staff were in attendance to hear the debate on Cr Petty’s motion.
Two young employees from the company, Tiarna Snow and Josh Coate, spoke against Cr Petty’s planned motion, focusing on the employment opportunities the company had offered them.
Ms Snow asked Cr Petty to reconsider his motion, calling on him to recognise the region’s youth unemployment and job security, as well as the contribution the company had made to Wollongong’s adventure tourism sector.
Mr Coate labelled the motion “anti-local” and said he did not know “how secure my job is” if the new administration building was not approved.
Wollongong City Council's response to questions, which was received after the Mercury's deadline:
"The original license to land in Stuart Park was negotiated by the then Council in 1996 for the original business operator and again in 1999 with Skydive the Beach.
"This is Crown Land managed by Council and a licence to operate Skydive the Beach at Stuart Park also was endorsed by the then Minister responsible for Crown Lands in February 2006.
"A report will be presented to Council in April with proposals regarding sky diving activities in the city.
"As you know Skydive the Beach is paying a commercial lease for the ageing building. The current lease for the old building is $40,149 per year and was established by an independent commercial valuation. In addition to this fee Skydive the Beach also pays $7,793 for the right to land in Stuart Park and at an alternate site at Dalton Park. This lease enables the business to operate in this building and use the areas for drop zones.
"Both the licence fee and the current lease are evaluated through a comparison of similar commercial activities in Australia."
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