This third Member Update is provided to the WA Basketball family, relating to the proposed cost to be imposed upon us by the Government to remain at the WA Basketball Centre.
Firstly, a big thank you to those who have answered the “call to action” and taken various steps to ensure your sport remains financially viable. Your support and passion has not gone unnoticed. Please keep up the good work.
There seems to be some mixed messages going around with respect to Basketball WA moving to the WA Basketball Centre and agreeing on a court hire rate. This update clarifies Basketball WA’s position and brings you up to date with recent developments.
The Key Facts Are:
- The Basketball Community built and paid for the vast majority of the Perry Lakes Basketball Stadium. (75% of the cost of the original venue and the cost of courts that were added subsequently). The stadium was originally built for the 1962 Australian Basketball Championships and was then used for boxing at the Commonwealth Games. Basketball WA then successfully managed the Stadium after the Commonwealth games for almost 50 years.
- In operating the Stadium, Basketball WA paid a peppercorn rent to the Town of Cambridge. The money received by Basketball WA for court hire, allowed the sport to remain financially viable and was used to fund growth and development programs in both Metropolitan and Country WA.
- Basketball WA in approximately 2000, entered into negotiations with the Town of Cambridge for a replacement basketball stadium to be built which Basketball WA would manage. Plans were drawn up and costed. The Town of Cambridge agreed to provide a replacement facility for basketball which was to be built on AK Reserve.
- In approximately 2005, the State Government approached Basketball WA and asked it to support the State Governments plan to reacquire the Perry Lakes land from the Town of Cambridge and build a “State” basketball facility. At this time, Basketball was already being “looked after” by the Town of Cambridge which had agreed to provide a replacement facility. Basketball WA agreed to support the State Governments plan to develop a “sports precinct” at AK Reserve/Challenge Stadium on the understanding that it would suffer no disadvantage. [It defies logic for Basketball WA to give up a replacement facility from the Town of Cambridge to one provided by the State Government where basketball would be worse off].
- Negotiations were initially based on Basketball WA managing the new facility, as was the case at Perry Lakes, and generating vital income through court hire to fund the sport. We now have to rent the WA Basketball Centre back from the State Government.
- In moving from the Perry Lakes Stadium to the WA Basketball Centre, Basketball WA lost a number of revenue streams that now go to Venues West. These include bar, kiosk and court hire for non-basketball activities and sponsorship signage. Venues West will not permit Basketball WA to “on-sell” courts to non-basketball users, even if the courts are not being used.
- Basketball WA agreed to pay a court hire rate of $8.06 (ex GST) in moving to the WA Basketball Centre. This took into account savings for Basketball WA in not having to pay maintenance, cleaning and electricity for the venue. It also took into account a 20% increase to “user” charges that Basketball WA passed on.
- In 2011, the State Government had an independent report prepared by BDO Accountants on Basketball WA’s first 10 months of operating from the WA Basketball Centre. The report showed a loss of $16,000 of net revenue from stadium activities. To suffer no disadvantage, the court hire rate should have come down to $6.71 (ex GST).
- For the period 2009 to 2011, Basketball WA’s net stadium revenue has reduced by $46,000. Despite this, as at 1 July 2012, the court hire rate was increased by the Minister to $13.84 (Ex GST) an increase of $107,000. This is over double the no disadvantage rate. Basketball WA has agreed to pay this increase on the proviso that it be indexed to CPI for 5 years. This is an extremely reasonable offer to pay double the no disadvantage rate and demonstrates Basketball WA’s commitment to the Government in contributing to the long term sustainability of our new home whilst ensuring the financial viability of our sport. The State Government will not agree to index this rate to CPI for 5 years and have indicated that it intends to levy a further increase in the order of $100,000 on 1 July 2014.
- Basketball WA has met with DSR which has now advised that funding received from the Department is NOT linked to the current court hire issue.
- What Basketball WA receives in funding for its programs from DSR, Healthway or any other party is irrelevant to the current issue. The only relevant financial information is that relating to the stadium.
- We look forward to working with DSR for the continued betterment of basketball in Western Australia.
CEO AND BASKETBALL WA BOARD
- In a radio interview on 6PR last week, the Director General of the Department of Sport and Recreation suggested some “untruths” were being told and that the Board of Basketball WA was not being given all the facts. Your Board has advised the Director General both in person and in writing that it has the utmost confidence in the CEO who has, at all times acted in a professional manner and under instructions from the Board. Furthermore, the CEO has kept the Board apprised of all developments through detailed briefing papers and regular email updates and has sought input and approval from the Board on Member Updates, correspondence with the Minister and other actions taken by Basketball WA.
MEETING WITH THE MINISTER
- A meeting with the Minister for Sport and Recreation has been scheduled for Wednesday 17 October 2012.
Your Board has resolved that it will only agree to the current rate ($13.84) for a 5 year period, indexed to CPI. This is the position that your Board will put to the Minister tomorrow.