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http://www.abc.net.au/stateline/vic/content/2005/s1462139.htm
Transcript
The East Gippland Shire Council property deal which cost ratepayers a fortune
Broadcast: 16/09/2005
Reporter: Ben Knight
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BEN KNIGHT, REPORTER: Six years ago, the development of this property owned by the East Gippsland Shire Council was going to be the biggest thing to ever happen to Lakes Entrance. A sports centre, a retirement village, a conference centre - all while giving the council some much-needed income. It never happened. We the people of East Gippsland are $912,000 out of pocket.
BEN KNIGHT: And the story of why it has only now been revealed in an auditor-general's report released in July. It found evidence that the then mayor had been secretly and inappropriately talking to the developers during negotiations, that the man the council was negotiating with was a bankrupt at the time with a conviction for failing to act honestly as a company director and that the company he fronted had a share capital of just $10. The auditor also found that council staff didn't do enough to research the background of the developers and that when they did discover problems did not adequately warn the council of the risks. At the time, it took a rate-payer revolt to stall the council's plan to sell.
DAVID EAGLESON, PLAINTIFF: I went to the Minister for local government, Mr Cameron, and complained to him about the process. And he - his response was if you don't like it, vote them out. It's clearly an inadequate way to deal with it as far as I'm concerned. So I had no choice but to engage a legal firm to represent me and the Ratepayers Association. And we served an injunction on the council to stop the sale.
BEN KNIGHT: David Eagleson and his wife mortgaged their farm to do it. But they represented a large group of angry ratepayers who had been concerned about the sale since it became public knowledge in 2001. Back then, the council's plan to sell its property came as something of a surprise.
LINETTE TREASURE, FORMER PRESIDENT,RATEPAYERS VICTORIA: There was so much that happened out of the public arena. The sale was progressed to almost within a few weeks of signing or decision to sell before the public even knew about it.
BEN KNIGHT: After community protests, the council decided to extend the period for public submissions. But the community anger wasn't just about the way the sale had been handled. It was also about the price: $1.5 million.
DAVID EAGLESON: It was obviously an absolute giveaway bargain. I had seen it advertised in the estate agents' windows in the vicinity of $3 million. When I heard $1.5 million, I thought this is not right.
BEN KNIGHT: So David Eagleson put in his own bid for $1.6 million. But the auditor-general found that the then mayor Tom Courtney told the developer about the new bid, who then matched it. But the mayor didn't do the same for David Eagleson, saying at the time that he didn't take his bid seriously.
TOM COURTNEY, MAYOR: I thought he was a ham in Hamlet on Monday.
BEN KNIGHT: Two weeks later, after continuing public pressure, the council voted to stop the sale and put the property out to tender. The man the council had been negotiating with, Dr Ian Bennett, was disappointed and he said so in an email to the mayor Tom Courtney. He said much more:
DR IAN BENNETT, LAKES VILLAGE PTY LTD, QUOTED IN CORRESPONENCE TO TOM COURTNEY: I know you are disappointed too, and I would like ot keep this communication strictly confidential to see if we can resurrect the situation. I have been asked not to directly communicate with council in the interim, bit I will with you through your home email, if that's okay with you.
BEN KNIGHT: In his return email, Tom Courtney acknowledged that he and Ian Bennett were in contact by phone and by fax and he didn't raise any concerns about whether much contact was appropriate during a tender process. Those emails were turned up Adrian Lalor, a retired
http://www.abc.net.au/stateline/vic/content/2005/s1462139.htm
Transcript
The East Gippland Shire Council property deal which cost ratepayers a fortune
Broadcast: 16/09/2005
Reporte…