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As work presses ahead with the Masterplan for Callan Park, progress on the Heads of Agreement for the site remains deadlocked, with Leichhardt Council retaining concerns over funding of remediation, cleanup of site contamination, and maintenance of the grounds.

According to the Friends of Callan Park, “basic on-site investigations were done last September”, with Council calling for a full investigation after earlier spot checks revealed ‘hot spots’ of contamination on the site. “The contamination has apparently been caused by the burying and burning of hospital wastes last century, the storage of fuel and the infill of foreshore areas with building and other waste materials,” wrote Friends of Callan Park co-ordinator Hall Greenland in a recent update. “The state government is offering Council $2.4 million – or what it would spend on maintenance between now and mid-2011. From that point onwards, the state government would be financially responsible for only its third of the site.”

Balmain state MP Verity Firth reiterated her belief in the Heads of Agreement as the way forward. “I feel that every single demand Council has made, we actually have delivered,” Ms Firth said. “The Council said they wanted the contamination reports – we gave them all the contamination reports. Then they said they wanted the state government to pay for any remediation arising out of the contamination report – we said we would do that. They said they wanted us to look after the sea wall – we said we would do that. We announced we would pay for the entire cost of fixing up the Bay Run, even though originally it was supposed to be half-and-half with Council. I think the thing that I’m finding just frustrating is, I do think there is genuine good faith… to get an outcome, but I’m beginning to think some of the stuff is more political than about actually delivering outcomes.

“We’ve always said to them, publicly and privately – you do the Masterplan, and once it’s complete, bring it back to Government, and we’ll talk to you if you need ongoing recurrent funding. I don’t quite know what else we can do other than say, ‘Whatever you find, we will fund it for perpetuity’ – [and] no-one can say that before there’s been a Masterplan.”

She added that many of the heritage buildings on the site – representing much of the immediate capital expenditure required – will remain in state government hands.

“A lot of what I think they think is going to be a really huge liability, actually won’t be, because the vast majority of the heritage buildings actually stay with state government,” she said. “The Kirkbride Building, the Writers’ Centre, all of Rozelle Hospital – all of that, and their associated liabilities, stay with the state government. But Council have been bandying around figures of around $35 million a year, and all this stuff – they can’t possibly expect, before there’s even been a Masterplan, for us to give them $35 million a year.”

Council, however, remains equally resolute in its position, with Deputy Mayor Michele McKenzie claiming the Heads of Agreement could not be signed without breaching Council’s statutory obligations.

“Why would you take on Callan Park?” she said. “It’s going to cost a fortune – we did an assessment in conjunction with the Department of Health and Sydney Harbour Foreshore Authority. Councillors are obliged by the Local Government Code to know where ongoing recurrent funding will be sourced from, and that is something that at the moment, we cannot do. Assets need to be kept at a certain standard, and at the moment they’re not – they’re falling apart.”

She accused the Government of trying to “cost-shift” the financial burden of Callan Park onto Council.

Mayor Jamie Parker said Council needed confirmation that the contamination issue would be resolved, and said the funding on offer from the state government was wholly inadequate for remediation. “Our own analysis showed the site requires $1.5 million in immediate expenditure, and they’re asking us to run the site on $1.8 million a year,” he said. “That’s a significant extra burden for local ratepayers – our total rates revenue is around $35 million a year.”

He also reiterated that Council had written to Ms Firth’s office in January, February and March, but was still awaiting a response.

In reply, Ms Firth said, “My understanding after that meeting was that Leichhardt Council would continue to negotiate with Government around the Heads of Agreement. I am always happy to help bring Council and Government together to facilitate the delivery of Callan Park into local hands.”

Ms Firth drew comparisons between Callan Park and Sydney Park. In the latter’s case, she said City of Sydney Council “did a Masterplan, worked out a funding strategy and did up the park”.

But Cr Parker rejected the comparison, saying the City of Sydney’s ability to undertake such a project was far in excess of Leichhardt Council’s. “The City of Sydney’s budget surplus last year exceeded our rates revenue,” he said.

Cr McKenzie said the State Opposition had repeatedly promised recurrent maintenance funding, as well as funding for the Masterplan.

With the standoff looking to have no immediate resolution, Rozelle Residents Action Group spokesperson Mark Wallis said the longer it took to reach an agreement, the higher the ultimate cost of remediation would prove. “Nobody wants to see the heritage buildings falling down – they’re stunning,” he said. “But the longer you leave them without repairing them, the more expensive it’s going to be.”

Nevertheless, he supported Council’s approach to proceedings. “I think Council are acting responsibly in the way they’re approaching the issue,” he said. “It could potentially be a huge burden for the ratepayers of the municipality, and they’re right to proceed cautiously.”