TCAL CEO Tania Delahunty is hitting back at statements made by Ian Stevenson at a recent Tauranga City Council projects and monitoring committee public forum on July 25.

Tania Delahunty.

Ian, Rob Paterson and Fred Greenville used the public forum to take the city council to task over its handling of the hot pools issue.

Tania says Ian's claim Tauranga City Aquatics Ltd made a $4.222 million loss for the last financial year is not true.

'This loss is an accounting loss due to a financial adjustment for taxation changes,” says Tania.

'This is not an operational loss. The taxation adjustment has been made due to a change in tax laws around building depreciation, which was aimed at preventing rental property owners claiming depreciation on their houses and receiving a tax benefit.”

The law also impacted commercial properties and affected a number of organisations across New Zealand,” says Tania.

This adjustment has been reviewed and aligned off by Audit New Zealand and also council's tax advisors Toovey Eaton.
Ian also asked councillors why there are no water rates or rates paid by TCAL, a commercial entity.

'In our 2011 year end accounts just completed, we have paid rates to Tauranga City Council of $13,334exc GST, and water rates of $111,601exc GST,” says Tania.

'On top of this we pay TCC $180,000 per annum for IT support and $10,000 in admin support of per annum.

'The IT support fee was implemented last year and we did not seek additional rates funding from TCC to cover this cost.”

Ian's claim that Tauranga City Council staff are offered $249 gym memberships with pool use free, is also untrue, says Tania.

'As with any gym we offer corporate memberships, being a 10 per cent discount of full fees where five or more people from the same corporate join. This is standard business offering.

'We have made this offer to council staff. Aside from a couple of intranet adverts placed via the council comms team, we do not access council systems to promote our gym business as for example The Gym do.

'We have tried to remain impartial and only offer council the rates we offer any other members in the public.”
She says Ian has misunderstood the numbers concerning his allegations about the financial impact of the Mount Hot Pools closure.

The Mount Hot Pools current operating surplus of $160,000 a month on average goes to fund the other four Tauranga pools operated by TCAL: Memorial, Otumoetai, Greerton and Baywave.

'So with the Mount Hot Pools closed, we have a shortfall of funding for the other four pools,” says Tania.

'We are seeking a loan from council for this, that we will pay back ourselves.”

On average (and this changes month to month as high an low seasons) with the Mount Hot Pools closed TCAL will be losing $126,000 a month in revenue, says Tania.

On top of this, TCAL will still incur costs, like staffing, line charges for power.

'We have asked staff to take annual leave and we have re- rostered them into the network and we have reduced hours for casual staff,” says Tania.

'We are not legally able to dismiss staff and nor do we want to as the closure is too short and we need trained staff to reopen.”

A small amount of power usage, rates etc are all still incurred and do not cease.

These costs are about $45,000-$55,000 per month, making the loss to the network of pools, about $160,000 per month.

Tania agrees with Ian that the three ‘very basic and small' massage rooms at the hot pools will not entice cruise ship clients and that the cruise ship spas will be superior to what's currently on offer.

The redeveloped hot pools will offer an up-market wellness suite offering a range of treatments including local offerings making use of local products such as kiwifruit, salt, Comvita honey products and oils, says Tania.

'The package, including a soak experience in geothermally heated salt water is unique and something you would not experience on a cruise ship offering.

'We also experience an increase in retail sales whenever there is a cruise ship in port. This tells us that they do come into the facility, but the offering currently is not enticing them – hence the redevelopment.”

Ian's claim it will take 144 massages a day to meet interest payments alone on the $10 million spent redeveloping the hot pools shows he has misunderstood the business case, says Tania. The whole facility will be paying off the debt, not just the massages.

This includes the wellness centre and the aquatic users. Also visitors also spend at the cafe and on merchandise.
The user visits in the business case are:
Aquatics – The goal is 229,300 (year one and growing). We currently do 214,000pa and in the past the annual visits reached 360,000+pa.

Wellness – The goal is 15,000pa (growing). They would also be spending on retail. Our advice is that the average customer will spend upwards of $100 on product after treatment.

Claims the redeveloped pools will seriously impact cafes and restaurants on Marine Parade and put out of business ratepayer owned wellness centres are also denied.

'In terms of the impact to the local cafes and restaurants, you may recall the outcry by these local businesses when the facility closed recently,” says Tania.

'It is envisaged that as a tourist destination our facility will positively impact the likes of restaurants and accommodation and retail businesses.

'The package we are offering is not beauty therapy, as the other facilities do. We are offering a unique experience for a wellness treatment and a soak in hot therapy pools.

'We are not planning on offering standard beauty therapy treatments such as tanning or waxing or semi medical facials (laser treatment, etc).

'In respect of the café we are offering a limited service to our patrons. We have not included a commercial kitchen within our development.”