With Warrnambool ratepayers facing a potential rate rise above government caps, talk has turned to council costs.
The cost of running Flagstaff Hill Maritime Museum is frequently brought up on social media and some sections of the community.
Last year, the museum cost $1.78 million to run but council had to chip in about $518,000 to keep it afloat.
But council says that just looking at how much it costs to run doesn’t tell the full story of its value to the council, business and the community. They say it has never really made money, although there was a period in the 1980s and ’90s when it did turn a profit.
More than 57,000 people visited Flagstaff Hill last financial year, 92 per cent of them from out of town.
Council says the museum is worth about $5 million to the community when looking at the financial economy derived by visitors which takes into account money spent on accommodation and food.
Former chief executive officer Bruce Anson said the role of government was to provide services that generally the private sector wont.
“We don’t see those things as cost. Council makes those investment decisions for a purpose,” he said.
The council’s director of corporate strategies Peter Utri agreed that people picked on Flagstaff Hill unfairly.
He said it was about providing a regional experience and what it brings to the economy.
“The purpose of Flaggy isn’t to be a village for locals, it’s to attract people and keep them to stay another night,” Mr Utri said. “It’s an economic driver, the art gallery is a social driver.”
He said it cost the council more than $500,000 to fund the art gallery each year which had 39,000 visitors in 2017/18 and is projected to bring in 50,000 this year.
Mr Anson said that not only did the gallery keep our art works safe, it was part of Warrnambool’s livability. “It’s part of us being a modern city. They’re the things that are often missed in the debate,” he said.
The library costs more than $800,000 to run, while council chipped in about $490,000 for Aquazone which has 240,000 visitations a year. Mr Anson said with 80 full-time and part-time staff, Aquazone created a lot of jobs. “From a business point of view, it’s a real economic driver in its own right,” he said. Mr Utri said there had been a fair bit of commentary about relating council facilities to commercial activity rather than community service.
“We provide parks and gardens. No one would question that we should be taking care of parks and ovals and fire breaks,” he said, pointing out that those costs were in excess of $4 million. Visitor economy manager David McMahon said Flagstaff Hill and its 150 volunteers were a critical element of the visitor economy. “Without it the accommodation industry would very much feel the impact,” he said.
‘Privatise, build a resort’
Flagstaff Hill should be privatised and a Cumberland-style resort built on the site to relieve the council of the financial burden, councillor Peter Hulin says.
Cr Hulin said the amount of money the facility was losing every year was “unacceptable”.
“I think Flagstaff Hill is an asset to our city. The maritime thing is definitely something we should continue with,” he said.
Cr Hulin said that for 10 years he had been pushing for it to be privatised.
“We need to talk to the state government and see if we can get part of or all of it to a point where we can put it out to private enterprise to possibly build something like a Cumberland-type resort into it in front of where the car park is,” he said.
One of the biggest challenges with Flagstaff Hill was accessibility to the different levels, he said, and a high-end motel with lifts would take people from floor to floor.
Cr Hulin said that a condition of any motel development would be they would have to also manage the museum.
“So Warrnambool would not lose the maritime museum, but it could be run under strict guidelines by private enterprise,” he said.
“I’m sure they would bring a lot of vitality into Flagstaff Hill which unfortunately council just doesn’t have the resources to do.”
Cr Hulin said that if it was owned by a private person or company, there would be no way it would allow the losses that had incurred at Flagstaff Hill.
“We can’t just keep putting money into it hoping it’s going to get better,” he said.
“The light show, the $3 million spent on the light show just really hasn’t helped, from what I can see, the bottom line in any dramatic way.
“It’s like the death of a thousand cuts really and it was time that it was dealt with.”
Years ago it was mooted by a developer that Flagstaff Hill could include accommodation in the village itself, he said, and a high-end development would be a bigger drawcard for tourists.
“I don’t think closing Flagstaff Hill is the answer,” he said.
“Run it like a business is basically what I am saying.”
He said most people didn’t realise what things cost to operate and even suggested that council should look at opportunities to bring business to the gallery and other council-run facilities.
“It may be we have to spend money to get it to that point, to continually bankroll these things that are increasingly losing money, personally I find it very hard to understand,” he said.
Cr Hulin said that when it came to talking about rate rises, the council needed to look internally at efficiencies with the way it was run.
“Places like Flagstaff Hill should have been looked at years ago,” he said.
Village built to kick start tourist industry
The creation of Flagstaff Hill was designed to make Warrnambool a year-round tourist destination, according to one of the main drivers of the project John Lindsay.
Mr Lindsay said if it wasn’t for Flagstaff Hill, Warrnambool probably wouldn’t have the amount of accommodation and shopping it has now.
When the museum was first planned in 1972 there were just nine motels in Warrnambool, he said, and now there was about 100.
In the early 1970s, Warrnambool was a summer destination and tourism promotion was based on bringing people here for the Christmas/New Year period.
With concerns about the city’s textile industry being squeezed out by cheap imports, there was a push to develop tourism in the region, he said. The state government had identified Warrnambool as one of five major tourist projects.
He said there was tremendous public and council support for the project. It was built with $200,000 from the state government, as well as Federal funds. The community chipped in $100,000.
“It’s always been something that has cost the community something,” he said. However, he said there was a period in the 1980s and early 90s where it did make a profit. Mr Lindsay said it stimulated development which in turn brought more rates into council’s coffers.
After serving on the chamber of commerce and the Flagstaff Hill planning committee, Mr Lindsay ran for council in 1975 and served 10 years including two terms a mayor from 1980-82.
“I really went into council on the basis that something needed to be done to secure Flagstaff Hill,” he said.“I really don’t know why people have such a bitterness about it.
“Council isn’t in the game of running the community for a profit, it’s to provide services and one of those services is to provide more growth of the community through the development of tourist ingress 52 weeks a year not five weeks a year.”