KEY water and sewerage projects across Banana Shire, worth more than $5.5 million, have been mothballed due to the removal of State Government grants.
The government's axe-wielding and belt tightening has created a budget black hole of $2,513,000 for Banana Shire Council.
Chief executive Ray Geraghty told Central Telegraph the council had been informed of the subsidy cuts, including the annual roads and drainage grant of $311,000, just days before handing down this year's budget.
“The loss of this [roads and drainage] grants is equivalent to a 2% rate rise or the loss of four to six jobs,” he said.
“Applications for subsidies for these projects had been lodged or were being assessed by the Department of Environment and Resource Management.”
Mr Geraghty said the previous Smaller Communities Assistance Program and capital works subsidy programs had been finalised and there would be no further subsidies until a new program in 2011.
The chief executive said the affected water and sewerage projects, including four projects with a cost of more than $800,000 each, remained in the budget.
“As a result [of subsidy cuts] Council has deferred these projects and is seeking alternative funding sources.”
Mr Geraghty ruled out more loans as the projects already included loans. The council is in the process of writing submissions for Federal Government funding.
“It's about keeping it affordable and without the subsidies they aren't.”
He said most of the projects were really important, including the clear water storage tank at Biloela treatment plant and sewerage treatment plant upgrades at Taroom and Theodore, needed to keep them up to legislative requirements.
Mr Geraghty said Council's allocation for the projects would be shifted around to fill in some of the other gaps.
At this stage, the Thangool sewerage project would be mothballed, but others could follow dependant on council' success at a federal level.
Local Government Minister Desley Boyle denied the claims.
“Banana Shire Council has been allocated $4.29 million for water and sewerage projects in the grants scheme, with almost half a million dollars still to be paid over the next two years,” she said.
“This outstanding funding will be going towards a range of projects, including the Biloela sewerage treatment plant and planning work for the Wowan and Goovigen water supply.
“Banana Shire Council has not missed out on $2 million, however, it did make a submission for $136,000 but the grants and subsidies program was fully subscribed so the application missed out.”
The Minister said the five-year $700 million grants program was fully expended and finished this year.
“Everyone has to rein in spending during these tough economic times, including all levels of government.”
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