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Late Items

 

Council  Agenda

 

 

 

25 June 2014

 

 

 

 

 

ALL INFORMATION AVAILABLE IN VARIOUS FORMATS ON REQUEST

 

 

 


CITY OF BUSSELTON

Late Items FOR THE Council  MEETING TO BE HELD ON 25 June 2014

TABLE OF CONTENTS

 

ITEM NO.                                        SUBJECT                                                                                                                              PAGE NO.

15..... Chief Executive Officer's Report. 3

15.2        PROPOSED AGREEMENT TO PROCEED WITH NEW CONCEPT FOR 'RAILWAY HOUSE' AT BUSSELTON FORESHORE. 3

 


Council                                                                                      3                                                                         25 June 2014

15.             Chief Executive Officer's Report

15.2           PROPOSED AGREEMENT TO PROCEED WITH NEW CONCEPT FOR 'RAILWAY HOUSE' AT BUSSELTON FORESHORE

SUBJECT INDEX:

Busselton Foreshore: Railway House

STRATEGIC OBJECTIVE:

A City where the community has access to quality cultural, recreation, leisure facilities and services.

BUSINESS UNIT:

Governance Services

ACTIVITY UNIT:

Major Projects

REPORTING OFFICER:

Manager, Governance Services - Lynley Rich

Manager, Major Projects - Paul Crewe

AUTHORISING OFFICER:

Chief Executive Officer - Mike Archer

VOTING REQUIREMENT:

Simple Majority

ATTACHMENTS:

Attachment a   Preliminary Concept Design Railway House

Attachment b    Opinion of Probable Cost Railway House  

  

 

PRÉCIS

 

It is proposed that the City of Busselton proceeds with the development of formal agreements with the Busselton Jetty Environment and Conservation Association (BJECA) and the Geographe Bay Tourism Association (GBTA) to achieve the construction of ‘Railway House’ at the Busselton Foreshore.  The City has received advice of in-principle support for the proposal to relocate the old Busselton Railway Station, currently located at Rotary Park, to the Busselton Foreshore from both BJECA and GBTA.  The old railway station would form the basis of a newly constructed Railway House and would provide the City, BJECA and GBTA with a co-located key presence on the Busselton Foreshore.

 

 

BACKGROUND

 

The construction of a ‘Railway House’ on the Busselton Foreshore has been proposed since the inception of the Busselton Foreshore Master Plan, with the concept originally being developed through the Busselton Foreshore Working Group after BJECA identified a need for additional space to support the operations of the jetty and the jetty train.  One of the key uses of the proposed facility was to house the jetty train, while also providing a space to celebrate the heritage of the jetty and other historical aspects of the District.  This included a home for the recently restored Ballaarat engine, recognition of the timber industry and its links to the ‘port’ of Busselton Jetty, and the concept of commencing the Rails to Trails project from Railway House.

 

Original concept plans identified a two-storey development approaching a cost of $4-5 million including exhibition areas, museum, interpretive and function spaces.  Since that time, the concept has been refined to ensure its affordability, appropriate use of the space provided and opportunities for multi-use proposals.  More recently, negotiations began to include GBTA requirements in the concept after GBTA identified a desire to remain on the foreshore after a successful trial from a temporary foreshore location.  A number of designs, management models and conditions within existing agreements have been negotiated recently with both BJECA and GBTA and both organisations have now provided in-principle agreement to the proposal that is outlined in this report.

 

STATUTORY ENVIRONMENT

 

The proposed location for the construction of Railway House forms part of Reserve 38558, with the Reserve purpose being ‘Public Recreation’ within the ‘Special Purpose (Busselton Foreshore)’ zone.  This proposal is consistent with the purpose of the Reserve and the City has existing power to lease.  No further statutory processes will therefore be required to secure the land for this development.

 

RELEVANT PLANS AND POLICIES

 

The Busselton Foreshore Master Plan (BFMP) was developed with provision for Railway House to be located south of the existing Goose, but north of the spine road so as to avoid complications of the railway line crossing the spine road.  This proposal is in keeping with the BFMP.

 

FINANCIAL IMPLICATIONS

 

An opinion of probable cost (OPC) for the relocation of the old Busselton Railway Station and the construction of ancillary buildings, storage areas and a train tunnel has been developed by the City’s Major Projects team responsible for the proposed design.  The total project cost is in the vicinity of $2 million to $2.2 million, dependent on the final design of the areas to be occupied by BJECA.  The costs for which the City would be responsible under the proposed agreement between the City, BJECA and GBTA amount to $1.125 million.  $1 million has already been identified in the City’s draft 2014/15 budget for this purpose as a transfer from the Infrastructure Development Reserve.  It is proposed that $125,000 be further allocated in the 2014/15 budget from the Building Reserve.

 

The OPC is based on a preliminary design that may be further refined to ensure BJECA’s requirements are accommodated.  It is however noted that the agreement that is currently under negotiation would see BJECA paying for those areas of the building to be provided for their purposes.  Therefore any increase or decrease to floor space or other changes in these areas would only impact on the portion payable by BJECA.  The City will include in the proposed agreements that BJECA’s contribution would be the actual cost of the section of the building for BJECA’s use and would be confirmed through the competitive tender and contract award process, subject to the tenders being no more than 10% higher than final project estimate. 

 

The financial model for this project does not require an upfront capital contribution from GBTA.  The GBTA will instead return the building previously utilised as the Visitors’ Centre on Peel Terrace to the ownership of the City at no cost to the City.  While located on City land, the lease agreement for the land requires the payment to GBTA a sum equivalent to the market value of the building upon any determination that the lease not be renewed.  This payment from the City will not be required under the current proposal.  It is considered the Peel Terrace centre will be a valuable addition to the City’s property portfolio and would provide the opportunity for the City to utilise the building as alternative accommodation for City staff during any redevelopment of the City’s administrative facilities.

 

STRATEGIC COMMUNITY OBJECTIVES

 

Enhancing our foreshores and reserves to provide a place where people can come together and engage in a range of social and recreational activity is a key strategy to deliver the Community’s objective of being a City where the community has access to quality cultural, recreation, leisure facilities and services, as outlined in the Strategic Community Plan. 

 

RISK ASSESSMENT

 

Risk

Controls

Consequence

Likelihood

Risk Level

Investing resources into the project without final formal agreement

Interim Memorandum of Understanding capturing the intent of all parties

Minor

Unlikely

Low (after the application of controls)

 

CONSULTATION

 

The concept plans have been discussed with both GBTA and BJECA over a period of time.  At this stage, the proposal for the City, BJECA and GBTA to build and manage a Railway House at Busselton Foreshore has been supported in-principle by the Board of GBTA, as advised on 16 June 2014.  The GBTA has advised the City that the foreshore location, together with the heritage of the Old Railway Station and associated interpretive space, will provide a drawcard for visitors and assist the GBTA to continue to provide quality visitor servicing, and grow the contribution tourism makes to the local community.

 

BJECA’s executive committee has agreed in-principle to the proposal put forward by the City, however, the proposal will also need to be considered at a general meeting of the association proposed for early July.  The outcomes of this report will therefore be subject to the final approval of BJECA after the conduct of the next general meeting.

 

However, BJECA’s executive committee advised the City on 13 June, 2014, that the executive committee agreed in-principle and would progress discussion on the proposal, subject to consideration of some additions to the proposed building and other design considerations.  These matters have been further discussed with BJECA but are still subject to finalisation.  This is the reason for the project being identified as between $2 million and $2.2 million as discussed in the report.

 

OFFICER COMMENT

 

The proposal was presented by the City to BJECA and GBTA earlier in June, with the City looking to fast-track the proposal to an MOU stage to enable formal negotiations to continue as soon as possible.  This is presented as a late report to the 25 June 2014 Council meeting to enable this to occur as soon after BJECA’s general meeting as possible, subject to confirmation of BJECA’s in-principle support.

 

The proposal was presented to GBTA in the following terms and the in-principle support was provided without change.

 

1.      For provision of approximately 120m² indoor visitor servicing space/retail in relocated old Railway Station (no capital funding required by GBTA). City receives Peel Terrace visitor centre in exchange. ie upon moving in or sooner (by agreement). Long term lease provided free of charge – 21 yr.

 

2.      City to provide basic fit out of their space, GBTA responsible for soft furnishings etc.

 

3.      That GBTA be responsible for the day to day management of the Interpretive Space and for the bookings.

 

4.      For private use outside normal opening hours or via special arrangement for exhibitions, GBTA be provided access to Interpretive space on an advanced booking arrangement (as per BJECA, Community and City) for functions etc on cost recovery basis.

 

5.      City would be responsible for the curatorial management of the interior of the Interpretive Space and for any City exhibitions.

 

6.      City would meet outgoings of Interpretive space however would seek a part contribution to cleaning of the ablution area (which will be used by GBTA, staff and the public).

 

7.      GBTA responsible for outgoings on “Old Railway Station” such as cleaning, power and water and general building maintenance and City responsible for structural maintenance issues.

 

8.      City would also insure the Building, GBTA would be responsible for insurance of contents and other fittings.

 

The proposal was presented to BJECA and has been agreed to in-principle subject to further layout and design discussions, which will determine the final cost estimate.

 

1.      That the City would be willing to renegotiate Jetty Management Licence to provide greater tenure and more favourable annual licence terms to BJECA, on the basis of a modest fixed percentage increase per annum (say CPI minus 1%) with an agreed share of Jetty Entry fee turnover above an agreed threshold amount that is achieved in any particular 12 month period, ie linked to activity and seasonal factors.

 

2.      That BJECA be given a long term lease over their space in Railway House (free of charge) - 21 yr (to be agreed).

 

3.      That BJECA contribute the capital funding cost of the Railway Tunnel section, administration space, workshop, storage space (as per design of BJECA’s area requirement subject to competitive tendering).

 

4.      That BJECA meet all outgoings of their executive space in Railway House (specifically metred), cleaning, power, water and insurance.

 

5.      For private use outside normal opening hours or via special arrangement for exhibitions, BJECA be provided access to Interpretive space on an advanced booking arrangement (as per GBTA, community and City) for functions etc on cost recovery basis.

 

6.      That the City would enable BJECA to have the Interpretive collection relocated to the Interpretive Space in Railway House (subject to specialist curatorial advice) to enable BJECA to free up space in the Interpretive Centre for either additional merchandise or other activities (to be agreed upon).

 

The City’s space would provide a home for the Ballaarat engine, interpretive display area, public toilets and function space.  It is noted that the OPC does not provide for curatorial services for the interpretive spaces and it is considered that some grant funding could be sought for this (eg National Trust with the Rails to Trails link) and this will need to be further investigated by relevant City staff.

 

It is now proposed that, subject to further approval from BJECA following the general meeting, the City initiates Memorandums of Understanding with both BJECA and GBTA to secure commitment for the project to enable design and construction to proceed while formal leases, licences and required changes to existing agreements are developed.

 

The project management of design and construction of the building will be undertaken internally by the City’s Major Projects team.  Greg Hood, who is a member of the City’s Assets Team, has undertaken the preliminary design work and will continue with the project by secondment to the Major Projects Team as required.   As flagged earlier, the final design and therefore final estimated cost will need to be finalised with BJECA.  However, the current preliminary design and OPC have been attached to this report.    While much of the work will be undertaken internally by City of Busselton officers, it is noted that the requirement for certain professional fees, an example being structural engineering requirements, has been built into the OPC. 

 

In addition to the matters currently covered off in the proposals that have already been put to BJECA and GBTA for consideration, the following matters will need to be addressed in the MOUs and future agreements:

·    Ownership of the shed that currently houses the jetty train to return to the City for relocation and site reparation;

·    Consideration of providing options on the 21 year leases, say three seven year options;

·    Terms of the licence agreement for the Busselton Jetty with BJECA relating to potentially capping any CPI increase applied to BJECA’s contribution; and

·    Capping of the cost of construction to BJECA as being within 10% higher than the final OPC.

 

CONCLUSION

 

The current plan is considered a good balance of affordability of co-location of facilities to add value to the Busselton Foreshore experience.  The opportunity to utilise and highlight the old Busselton Railway Station in the design has been well received.  It is recommended that the intentions of the City, BJECA and GBTA are now encapsulated in Memorandums of Understanding to provide for the advancement of the project.

 

OPTIONS

 

The Council may determine not to proceed with the construction of Railway House.

 

TIMELINE FOR IMPLEMENTATION OF OFFICER RECOMMENDATION

 

It is proposed that Memorandums of Understanding would be completed as soon as possible with all parties to enable the project to proceed with surety.  It is considered that this will take approximately six weeks.

 

OFFICER RECOMMENDATION

 

That the Council:

 

1.    Endorses the City preparing and entering into a Memorandum of Understanding with the Busselton Jetty Environment and Conservation Association (BJECA) outlining an agreement to proceed with the construction of Railway House on the Busselton Foreshore, subject to the outcomes of BJECA’s general meeting in July.

 

2.    Endorses the City preparing and entering into a Memorandum of Understanding with the Geographe Bay Tourism Association  (GBTA) outlining an agreement to proceed with the construction of Railway House on the Busselton Foreshore.

 

3.    Subject to the MOUs above, endorses the drafting of the necessary leases and licences and proposed changes to any existing agreements to facilitate this proposal.

 

4.    Provides for an additional inclusion of a transfer of $125,000 from the Building Reserve to the Railway House project in the 2014/15 draft budget.

 

 


Council                                                                                      6                                                                                     25 June 2014

15.2                             PROPOSED AGREEMENT TO PROCEED WITH NEW CONCEPT FOR 'RAILWAY HOUSE' AT BUSSELTON FORESHORE 

Attachment a          Preliminary Concept Design Railway House


Council                                                                                      9                                                                                                           25 June 2014

15.2                             PROPOSED AGREEMENT TO PROCEED WITH NEW CONCEPT FOR 'RAILWAY HOUSE' AT BUSSELTON FORESHORE 

Attachment b          Opinion of Probable Cost Railway House