Hollyford road cost balloons

By Laura Mills

Every day delayed in progressing the Haast-Hollyford road proposal is adding $15,068 to the cost, according to backers.
The road cost was originally given as $220 million.
However, a recent press release said road partners “have signed an MOU (memorandum of understanding) allowing $250 million to design, build, finance and maintain a toll road for a period of 30 years from the opening date”.
In response to queries, Haast-Hollyford Highway Ltd released an extract from a June legal report, which said the increase was due to interest charges, and the delays were costing just over $15,000 a day.
The memorandum was signed in June 2012, with an inflation rate of 2.5% built into the agreement.
In just two years the costs of the project has risen by almost $11m.
Haast-Hollyford Highway chairman Durham Havill said it had gone up in price, but inflation was also up so in real terms it was less severe.
“At the same time, we want to get it built sooner. The longer we leave it, the longer it takes for our economy to feel the benefits,” Mr Havill said.
The original figure of $220m was three years old, he said.
The proposed toll had subsequently been adjusted, too.
“It’s still very viable. If ever the Coast needs it, it’s right now. We need the tourism growth.”
A leaflet has just been distributed Coastwide asking for support from West Coast residents, and after that they would look to support from Southland.
With the dairy forecast again lowered last week, and mining still in the doldrums, Mr Havill said he believed the southern road link would help the regional economy.
“It won’t be the be all and end all, but it will certainly make a hell of a difference.”
The large number of tourists using it would need somewhere to stay, he said, suggesting new hotels would be required.
Costs exceeding $500,000 have already been incurred by the Westland District Council subsidiary Westland District Property Ltd, and the privately-owned Haast Hollyford Highway Ltd.
The agreement with the Chinese financial backers allows for time to process the resource consents, and construction, with the hope of opening in 2020.