The council is seeking further senior legal advice to prevent the hotel from going ahead, with councillors claiming at a meeting last night that the Stadium Management Authority failed to provide it with sufficient notice and detail of the hotel proposal before releasing plans to the media.
The SANFL, meanwhile, is arguing that protecting its revenue from Adelaide Oval is needed, despite chairman John Olsen’s claim that the sale of the SANFL’s land at West Lakes would assure the future of grassroots football in SA.
The $71 million sale of the Football Park land – the SANFL’s key asset until it agreed to move the headquarters of football back to the city – is earmarked to help the SANFL pay down debt and create a “future fund”.
SANFL chief executive officer Jake Parkinson told InDaily today that the future fund would become a reality – but not yet, with the final payment from West Lakes developer Commercial & General not due to be recieved until 2027.
He said payments so far had helped reduce the SANFL’s debt from $37 million to about $8 million. The remainder would be paid off over the next two to three years, with the SANFL also committed to giving state league clubs $2 million each from the West Lakes windfall. Once that process was finished, the SANFL would start building its future fund – a process that would take years before it could start generating a return to reinvest in community football.
“When the debt is repaid that will then enable revenue from the land sale to go into the future fund,” he said. “That becomes a replacement asset for what we had down at Football Park.
“We can’t use that future fund to fund operations because that would diminish your asset base.
“The returns start to flow out in 2026-27 as that fund continues to build.”
While he agreed the SANFL had a solid financial position, he believed the league was exposed to risks identified by the Stadium Management Authority including reduced revenue streams and escalating maintenance costs. The SANFL also had to find ways to fund the expansion of local football, being driven by the rapidly-growing popularity of girls’ and women’s competitions.
The SANFL is a partner with the SACA in the SMA’s governance and returns from the Oval represent 65 per cent of the SANFL’s total revenue, according to Parkinson.
Money was always at the heart of Adelaide Oval’s rebirth as the home of football in South Australia. The SANFL had enjoyed autonomy – and its own asset – at Football Park for four decades, after its relationship with the SACA had soured at the old city Oval.
Since the reunification, the SMA has constantly sought ways to broaden its revenue – from concerts, both inside and outside the ground, expanded licensing, a troubled venture into fine dining at the Hill of Grace, and the more successful Roof Climb enterprise.
The city council has been a sometimes perturbed onlooker, with recent conflict between the SMA and the city’s governing body centring on an application for modified liquor licensing conditions and, now, the Oval Hotel.
At last night’s committee meeting, the council refined its submission to a parliamentary select committee tasked with inquiring into the $42 million hotel proposal.
The council argues in its submission that it has been consistently kept in the dark by the SMA regarding the development of the stadium and that building a hotel on the Oval would compromise nearby hotels.
North ward councillor Phil Martin argued it was necessary to include details of every time the Oval management had gone to the council seeking confidentiality around events or development plans.
He said it was also necessary to provide the inquiry with details of the briefing the SMA provided to council in November, which he said was given only two hours before plans were leaked to the media.
“The fact that council had not been previously consulted, that Stadium Management Authority’s advice in a briefing was that the City of Adelaide had no role in the processes associated with a hotel proposal and that publication of the details of the hotel development on a News Limited website happened two hours later shows a disregard,” Martin said.
“These matters go to the heart of the governance of the SMA and the way in which we are prohibited from dealing with our stakeholders because of those governance arrangements.”
Lord Mayor Sandy Verschoor said the council had not been provided with an adequate briefing before plans were released to the media.
She said the consultation between the SMA and the council lacked detail and lasted “little more than five minutes”.
“It was very quick, it was two colour print-outs of what it’s going to look like,” she said.
“I do think it really goes to the differing views of what consultation means, but consultation after the fact is not consultation.”
Area councillor Robert Simms went further to label the consultation as a “complete sham” and a “slap in the face”.
“Council has been treated with complete contempt,” he said.
“We’ve seen this project given the green light and really it’s been like a knife through butter when it comes to approving a project like this and I think that’s profoundly disappointing.”
The SMA has previously argued that it offered council a second detailed briefing regarding the oval hotel on December 4, which council declined.
But Martin said the council’s decision to not attend the meeting was justifiable, given what he described as SMA’s “disingenuous behaviour”.
“The question is – why on earth would you agree to a second briefing after you were told at the first one that the proposal was none of your business?” he said.
Area councillor Anne Moran, who was chairing the meeting, said the council’s submission needed to provide an update on the council’s legal proceedings.
“It would be appropriate that we also add that we will be seeking further senior (legal) counsel advice on this,” she said.
The council has already received legal advice regarding the hotel proposal after a unanimous decision by councillors to oppose it.
But Verschoor told The Advertiser earlier this month that the advice was unlikely to preclude the development.
A spokesperson from the SMA said the Oval Hotel was required to maintain “Adelaide Oval’s position as an internationally recognised stadium” and one that could continue competing for events on a global scale.
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