Tauranga City Council has moved to support establishment of a Tauranga Art Gallery Foundation but not before some councillors questioned the intentions of its trust deed.

This comes after Tauranga Art Gallery Trust first encountered resistance from councillors in trying to set up the endowment foundation with $500,000 of the trust's own money last November.

Tauranga Art Gallery.

The money, originally donated to the Art Gallery Trust by the public to build the gallery, is in the trust account, but couldn't be transferred to a foundation account without council permission.

Yesterday, some TCC councillors were still raising questions with the art gallery trust about the independent fundraising foundation's trust deed.

Mainly, the questioning was about why the deed would allow the foundation to give out loans to individuals and also permit the foundation bank account to go into overdraft.

TCC councillor Gail McIntosh held particular concern with these two points, saying the clauses shouldn't be included due to the nature of the deed.

'I don't think these clauses [18 and 21] reflect what this trust is trying to do, which is to get in donations,” says Gail.

'Why would you want to make the bank account overdrawn or make loans to anyone else?” says Gail.

TCC strategic planner Jeremy Boase replied saying the trust deed is a standard 'off the shelf” document.

But TAG chairperson Phillida Perry, who responded to council enquiries, says the foundation may look at making a loan to artists trying to afford exhibition costs, which would be collected by the foundation at the exhibition.

'We're looking to develop something of significance here and a loan of money for a particular purpose may come about – and the foundation would get a refund on completion of the exhibition,” says Phillida, who points to some exhibition being organised 18 months out – putting artists on the spot financially for exhibition costs.

'If someone is going to have an exhibition in Tauranga or elsewhere – you may wonder if the foundation is protecting itself by asking for deposit – and why make loan of money to an artist to make a product they are being able to exhibit?” asked Gail.

The art gallery representatives say the trust would work to support artists coming to town to exhibit; and sometimes if a gallery initiates and leads an artist exhibition which will travel to other NZ galleries, a loan may have to be made to support headlining the exhibition.

'But you would expect to recoup the costs at the exhibition's conclusion.”

TCC councillor John Robson his understanding was the foundation is to provide a vehicle to encourage other people to put money into the art gallery.

'It seems the foundation has a far wider scope, mandate and vision than originally proposed in the motion.”

'The motion passed in council, that I moved, was to support the creation of a foundation for receiving funds [for the art gallery] – the foundation now has a much wider brief.”

But Phillida says the foundation needs to have a wider berth 'to support promoting widening knowledge of understanding arts in the community”.

'That is the catch-all phrase to ensure we comply – the principle purpose is seeing funds raised for the gallery and encouraging artists – and that's got to be good for the community.”

John later said he wasn't comfortable the trust deed is fit for purpose and he's like to see it 'tightened up” with caveat on two clauses referring to future use of funds.

Council CEO Gary Poole's reaction, was: 'within the context our art gallery is enhancing its ability to provide a wide range of art, and enhancing its capacity to the local Tauranga community”.

Gary says approval of systems and procedure after adoption of council support for the foundation would see the mechanics of how it works adopted by him 'before it goes live as such”.

Phillida says TAG does have trustees in mind for the foundation, which have backgrounds in legal, business and accounting to tick off crucial skillsets needed.

At the vote, John Robson, Catherine Stewart, Gail McIntosh and Bev Edlin all opposed the recommendation to support the formal establishment of the trust deed as it is.

John's bid for an amendment was squashed when the other five other councillors (including the Mayor, with Clayton Mitchell absent) moved for support to the foundation's establishment be given.

The foundation's trust deed had to be approved by council before the TAG Trust's money could be released for the foundation.