Merging the city's Council Controlled Organisations is going to cost ratepayers $225,000, plus an increased ongoing annual amount in director's fees.

The fees and salaries of the directors of the merged Tauranga trading organisations were revealed at yesterday's council meeting.

Tauranga City Council has announced the pay rates for the directors of the newly merged CCOs including Baypark.

The new leisure company created by merging Tauranga City Aquatics Ltd and Tauranga City Venues Ltd is expected to result in $1.8 million savings for the ratepayers within three years, says chief executive officer Leigh Auton.

The merged leisure company will have $150 million in ratepayers' assets including TECT Arena, Baypark and the city pools network.

It will have more than 200 staff and a combined turnover of more than $23 million, but $14 million of the income is from rates contributions for public good services and $9million from user fees.

The set up cost of $225,000 is to cover expected merger costs, $20,000 in legal advice, $10,000 tax advice, $100,000 for redundancies, with $15,000 for ‘other' expenses.

Business services group manager Dean Riley believes there's a possibility that fewer than five people may be made redundant from the merger of the two CCOs.

Council also decided directors of the city's merged Tauranga City Aquatics Ltd and Tauranga City Venues Ltd are to be paid between $28,000 and $32,000 a year with the chairman being paid up to $60,000.

The total amount currently paid to CCO directors is $76,000, which is low because city councillors David Stewart, Wayne Moultrie and Larry Baldock are TCAL directors who take no fees.

Councillors agreed to the increase in director's fees saying they want a more fiscally literate directorate to manage the leisure company on a properly commercial basis, and the fees are set at a market rate.

When councillor Larry Baldock, seconded by Wayne Moultrie, moved the council pay an additional $10,000 to the existing CCO chairpersons, it failed for lack of support. Fellow TCAL director David Stewart agreed with the sentiment but says it's better paid at the end of March.

Larry says TCAL chairman Shirley Baker's work is outstanding, and she deserves the payment when the extra hours she's worked at the current hourly rate are considered.

When councillors talked about paying the directors of the new company what they were worth, Larry said the words are hollow because of the vote against paying Shirley.