On Thursday the Hastings Council will discuss whether to ‘invest’ $100k of ratepayer dollars for a one-third ‘ownership interest’ in Horse of the Year (HOY).

Apparently this event, which HDC terms a “premier equestrian event in Australasia” isn’t quite premier enough to pay its own way. So HDC must ride to the rescue.

The rationale is old hat by now … it’s used for every event and attraction that catches the eye of Council spenders. There’s that magical multiplier effect. In this case, the claim is that the event generates $11.52 million in regional Gross Domestic Product. I tremble to think how well that calculation was vetted.

I, and I suspect most ratepayers, have nothing but admiration for HOY. It’s a terrific event, built up over the years, good weather or bad, by a dedicated Kevin Hansen. But the Mission Concert is a great event too, and attracts spending into the Bay. But when have ratepayers been asked to subsidise Rod Stewart’s visits? Get in line Mission Estate … you’re missing the gravy train!

Presumably HOY is a regional attraction, that simply happens to physically occur in Hastings. If any public money should be invested in HOY, why not Regional Council money? In fact, since whatever economic benefit there is flows primarily to the hospitality/tourism industry, why doesn’t Hawke’s Bay Tourism buy an ownership stake in what it regards as one of the three ‘signature’ events of the region’s social calendar?

HDC’s staff report says: “The option to not take up the one-third shareholding will require the Equestrian Sports New Zealand and Show Jumping Hawkes Bay to increase the shareholding in HOY Limited, something that either or both organisations may struggle to do. This could result in the HOY show not being secured for 15 years and the rights to the show being granted to another city.”

What? No private investors or corporate sponsors interested in continuation in Hawke’s Bay of the “premier equestrian event in Australasia”? Consider how quickly local sponsorship funds were gathered together to support a hockey team. What judgment is our local business and wealth elite making about this event and their dollars that our HDC Councillors believe they can make more wisely about our dollars?

One drawback might be that there’s no business plan yet. Imagine how far Riding for the Disabled would get asking HDC for $100k … even with a plan!

And then there’s the public’s judgment. This spending item, if approved by Council on Thursday will slip into the LTP process as a staff submission. In other words, it will escape the full public scrutiny — and opportunity to submit — that other spending proposals have had to endure over the past several weeks.

Another example of how easy it is to jump the normal obstacles when the Council is riding your horse.

Tom Belford

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4 Comments

  1. Well put, Tom. I think we all agree HOY is a tremendous showcase event and we would all like to see it stay in the Bay but as you so rightly highlighted, many of our ordinary community organisations are seriously struggling to survive without any council funding and are dependent upon the good-will of volunteers and meagre funds from cake stalls, quiz nights and the like. $100 K would go along way to keeping many of these community services a'float' (to continue the equestrian analogy)

  2. Historical note. – Mission Concerts would never have happened if Napier City Council had not been brave enough to invest $70,oo0 constructing the original stage back in 1993. No ongoing funding though.

  3. Hi

    Isnt this the very thing the Goverment is trying to stop councils from doing,and stick to their core duties,if it generates 11.5 mill when do I get my share as a house hold rate payer seems like we are subsidising coffee shops and bars all the time.

    CHEERS Bruce

    Ever suffering rate payer

  4. Thnk you Alan Dick. I knew NCC had invested in the Mission Concert but not the amount.

    HOY is a critical event for Hastings and Hawke's Bay and for reasons I do not completly understand they are now changing the method of organising and running it. HDC are proposing to invest in an event that does have real benifits, and the amount is no greater than the outlay on the RWC which outside of Auckland, Wellington and maybe Dunedin actually had a negative affect. Check this for an admission from Palmerston North.
    http://www.stuff.co.nz/manawatu-standard/news/696

    If we compare to the over $1 million a year HDC puts into the Opera House, the $1/4 million plus operating loss for Splash Planet, and the fearsome finances gobbled up by the Museum and Aquarium in Napier, the $100 000 which is supposed to be a one off contribution does not seem quite so bad.

    In the scheme of things such as the proposed $8 million splash out on Hastings Civic Square plus goodness knows how much in ongoing costs, or the hard to eliminate HDC aquatic facility that could cost $3 million a year in interest, capital repayments, and operating losses and put rates up by 7%, HOY will do much more for a tiny fraction of the outlay.

    As the HDC councillor most often opposed to any wayward spending of ratepayer funds this one offends me less than most. Lack of a business plan is a serious shortcomming that has topedoed this proposal for the moment at least, but if $100 000 was the difference in us retaining or loosing HOY I would support it though not necessary as a shareholder.

    A real issue for the moment is whether $100 000 is the absolute maximum or is there a risk of it going higher, and what is the certainty of getting it back as indicated.

    I believe there are many worse thaings that should be targeted with criticism, but I do think councils need to be very cautious when getting involved in commercial events. Anyone remember the fiasco when the Auckland Regional Council sponsered the LA Lakers and did a million dollars or more, or the V8 races in Hamilton.

    The call for councils to stick to core activities is justified but there are bigger fish to fry than this one.

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