ventnor town council - background to ventnor winter gardens closure

8/8/2019 Ventnor Town Council - Background to Ventnor Winter Gardens Closure

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12 January 2011Ventnor Town Council

Four Themes

Finances

OperationsBuilding

Management


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Four Themes

Finances OperationsBuildingManagement

o Profit/Loss

o Subsidies

o Reserves

o Insolvency

o Concessions

o Contracts

o Shows

o Closure

o 2003 Survey

o 2009 Survey

o H&S Report

o Running costs

oWGC Meetings

o Culture clash

o Auditor 2002

o Auditor 2009


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12 January 2011

Finances

Ventnor Town Council


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12 January 2011

Finances


Accumulating deficits


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12 January 2011

Finances


Accumulating deficitsYear Amount

1994/5 -8,101

1995/6 -14,278

1996/7 -6,610

1997/8 8,284

1998/9 -4,050

1999/00 100

2000/1 -5,370

2001/2 -29,638

To date

Year Amount

2002/3 -15,211

2003/4 -8,382

2004/5 -36,638

2005/6 -68,892

2006/7 -33,111

2007/8 -21,752

2008/9 -30,336

2009/10 -76,191

To date-59,123-349,636


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12 January 2011

Finances


Subsidy Dependent

Element Amount

VTC 350k

IoWC

Total

300k

650k

Brewery

Loan?

Legal costs?


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12 January 2011

Finances


Brewery Loan

Discussed by WGC 22/9/03 20k contribution to refurbishment

Offer reported to TC 11/10/04

ODPM required increase to 26,712

Refurbishment done autumn 2004

Receipt of 28,000 reported 9/1/06

Over 14 years at 12.18 per barrel

Restructured by Concessionaire 15/8/07

26,714 over 8 years @ 278.27pm

16,520 outstanding @ 1/1/11


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12 January 2011

Finances


Diminishing Reserves2000/01 25,337

2001/2 -26,132

2002/3 - 7,988

2003/4 50,000

2004/5 46,265

2005/6 2,298

2006/7 20,827

2007/8 21,568

2008/9 39,735

2009/10 8,233

2002/3 Precept up from43,500 to80,0002003/4 Precept up from80,000 to115,0002006/7 Precept up from80,000 to99,000


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Management


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12 January 2011

Management


WG Committee

First meeting 17 February 1994 Chaired from 6 June 1994 by three

Councillors for next 15 years:

Of its 92 meetings all but the first 9 withpublic & press exclusion

Membership consisted of whole Town Councilafter District Auditors intervention of2002 until June 2009

Absence of Strategic and Business Plans

Absence of professional senior management


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12 January 2011

Management


Clash of Cultures

Local Government Commercial operation

Rooted in Local GovernmentAct 1872

Rooted in modernmanagement practice

Highly bureaucratic Flexible & pragmatic

Governed by electedrepresentatives

Governed by appointedexperts

Managed by amateurs Managed by professionals

Decisions move upwards Decisions move downwards

Funded by rates/precepts Funded by operations


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12 January 2011

Management


District Auditor: 2002

Letter from District Auditor 19/4/02 Estimated deficit of 21,500...town

council has already taken action..byincreasing precept from 43,500 to

80.000. However, this action alone is not

sufficient, the Town Council now needsto address the underlying problems.

I am also concerned that between20k and 30k expense has beenincurred for which there was nobudgeting provision.


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12 January 2011

Management


Audit Report: 2009 Clear lack of management

control Clear evidence of lack of

effective oversight from thepolitical level by members

Numerous financial controlfailures in the management ofthe venues finances

The concession contract was

unlawfully procured Financial controls over banking,

ordering...authorising chequesand time sheets and theadministration of petty cashwere inadequate


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Building


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Building

Time scale EstimatedCost

Short-term 120,000

Medium-term 50,000

Long-term 30,000

TOTAL 200,000

Furthermore, it is recommended that certain ground, foundation and drainageinvestigations are carried out... so that the various movement mechanisms which

have and will continue to affect the building are better understood.

Condition - 2003


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Building Repairs & MaintenanceThe Winter Gardens accounts from 1994

2010 show the spend on Repairs &Maintenance at 107,768 or 560 amonth

Another 61,728 is recorded as spent onModernisation of Premises

27,982 (45%) of this was for the late

2004 refurbishment carried out by W HBrading Ltd that required receipt of theCoors Loan before the Invoices could bepaid


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Building

Main items EstimatedCost

External walls

& windows

225,496

Roofs 158,965

Redecorations 81,317

Other 129,030

TOTAL 594,808

Condition - 2009


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Building Health & Safety - 2009

It would appear that thisparticular area has beenneglected by those responsiblefor safety at thevenue

Norecords ...that members ofstaff have undergone any formof appropriatetraining

Nodedicated asbestos survey

documentavailableThere are a number of issues

that need to be promptlyaddressed the most pressing

being fire safety


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Building Running CostsIts a very expensive building! The last 16 years accounts show three lines of100k or more: Heat & Light: 160k

Cleaning & Waste Disposal: 105k Rates & Water: 100k

No charges for these were made to any of theConcessionaires

The current costs of these elements are: Heat & Light: 2k per month Cleaning & Waste Disposal: 1.5k per month Rates & Water: 1k per month


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Operations


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Operations Catering Concessions

Concession From To Termination

N Smith Mar 94 Nov 94 TC terminated contractS Harris Jan 95 Oct 99 Ill-health

J Lucas Oct 99 Nov 00 Not in WGC minutes

A James Nov 00 May 01 Resignation

E Street Aug 02 Mar 03 TC terminated contract

C Reed-Sampson Jun 03 Jun 05 Completed 2 year term

T Clark Jul 05 Dec 06 Change to concession

During the 14 years 19942007 seven people held theCatering only Concession


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Operations Legal Costs

Element Amount

Compensation 7,000

Glanvilles legal costs

Roach Pittiss legal costs

Total

13,069

31,270

51,339

One concessionaire took legal action against the Town Council forbreach of contract. The dispute lasted several years...


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Operations Shows TheWG needs 2 well-attended shows a month to

break-even... May had 1, June none.[July 06]

Nogigs are scheduled forNovember[July 06]

Recent shows seem to have been less well attendedwith net deficits resulting [July 08]

Several recent shows have been poorly attendedwith net deficits resulting [Aug 09]

Even with a full programme:15 events held March -November 2007. Average tickets sold 202; averageincome 2,675 ranging from 6,339 (Acker Bilk) to 630(Psychic Art); average surplus of 291, a net total incomeof 4,372.


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Operations Bar + Catering August 2006, WGC decides to invite applications for a

combined bar & catering concession Finance Officers report includes: 1k a week must be a minimum receipt from any

concession. There is no other way of breaking even; Determining a notice period is another requirement

Sub committee interviewed 4 on 31 October Appointed Perks of Ventnor from 1 Feb 2007

Contract: 3 months 600 p/w; 3 months800p/w, then 1,000p/w

subject to review every two years, the first review beingon 1 February 2009 andsuch review will not permit a

reduction to below 1,000


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Operations Bar + Catering

From To Wks P/w Amountpaid

Variationfrom 1,000pw

3/8/07 21/11/07 16 800 12,800 3,200

22/11/07 28/11/07 1 1,000 1,000 0

29/11/07 2/4/08 18 600 10,800 7,200

3/4/08 31/12/08 39 800 31,200 7,8001/1/09 29/4/09 17 500 8,500 8,500

30/4/09 27/10/09 25 800 20,000 5,000

Totals116 102,500

31,700

In response to a series of letters requesting rentreduction due to low activity levels the Committee agreed:


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Operations

Finance Officers advice: Determining a noticeperiod is another requirement had been ignored

Town Clerk retired on 2/10/09

One months notice given by Perks of Ventnoron 25/9/09 to finish on 27/10/10

VTC need 3 or 4 months to ensure a decent

solution [in fact] just 9 days(TC 19 October) Dispute over payment for stock and

miscellaneous items ended with payment of14k to concessionaire

Terminal confusion


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Operations Rescue operation

Emergency meeting with IoWC ChiefExecutive 16/10/07

VTC agreed to take over concession to save

jobs and secure income, in extremecircumstances

Including: absence of trading information

divided Town Council another Town Clerk resignation angry Town meeting

Limited reserves


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Operations All Options explored

Improved governance& management

Increased subsidy Summer programme

Raising theatrecapacity

Exhibitions

BUTCurrent economic climateChanged patterns of leisure activity

Seasonal nature of tradingMaintenance backlogUnfit for purpose, very expensive hallOverhead costs


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ConclusionsTown Council management of WG hasnt worked,isnt working and cant work

Still subsidy dependent

This years deficit similar to last (c75k)

No capital for investment

IoWC ending Management Agreement

With this track record, acceptance ofownership would be irresponsible

Unanimous Town Council decision to move on


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To have a future...


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To have a future...

Ventnors Winter Gardens musthave:

Realistic Business PlanSignificant capital investment Commercial operation that can

incorporate community use Experienced professional

management


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ventnor town council - background to ventnor winter gardens closure

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