From the Galway City Tribune – Councillors stand accused of ‘acting in haste’ when they voted to allow Galway City Council apply for a loan of €45.5 million to help buy an office block in Mervue to relocate City Hall.

The People Before Profit party in Galway has said this week there was ‘insufficient scrutiny’ of the property deal before councillors approved the loan application.

Sixteen elected members voted at the July meeting to allow Council management to apply for the loan to cover the bulk of the €56.5m capital outlay for the move to Crown Square.

As well as the €45.5 million, some €11m from the City Council’s own resources would have to be found to fund the fit-out of the new property.

The Galway City Tribune revealed a fortnight ago that the true cost of the loan would be €63.1 million.

That’s €2 million from the Council’s budget every year for 30 years at an interest rate of 2.25%, amounting to a €17.6m repayment cost on top of the amount borrowed.

The application was approved by councillors on the first day it appeared on the agenda – and just days after they had been informally briefed about the proposal.

The Tribune highlighted two weeks ago that a reply to a Freedom of Information request suggested that senior management at the Council did not meet with representatives of the Crown Square development in the 12 months prior to the proposal being presented to councillors – and if they did meet, then minutes were not kept.

Council Chief Executive Brendan McGrath previously confirmed that a public procurement tendering process was not used prior to agreeing to buy Crown Square.

This week Adrian Curran, Galway representative for People Before Profit, said our story raised serious questions about the deal.

“I wonder what it is we are being asked to believe. If there are no records of minutes of meetings between the Chief Executive and the owners of the site, and also there was no public tendering process, how did this proposal land in the lap of councillors, how did it come about?

“I also think it’s incredible how easily and quickly the majority of councillors rubber-stamped it. It came out of no place, and some of them were publicly backing the plan before they even had all the details of it,” Mr Curran said.

He suggested that there hadn’t been sufficient scrutiny of the proposal, nor had there been sufficient public knowledge or public debate about the plans prior to councillors voting to apply for a loan.

“I couldn’t believe how quickly it went through. I know some councillors asked questions but in the end, all bar one of them present voted for it on the day it was presented to them. There was relatively little public scrutiny of it. I don’t believe it was properly covered in the media, bar yourselves [Galway City Tribune], and I think many people are not aware of it,” Mr Curran said.

At the July meeting, councillors were warned that if they delayed the decision to apply for the loan, then interest rates could rise and that would push up the overall cost of the repayments and project.

Mr McGrath also indicated at the July meeting that it was his preference that the College Road site would be used for social housing once the move to Crown Square was completed, but this was not tied to the proposal.

“The idea of there being social housing on the [existing City Hall] site was put out there as a sweetener. But there’s no guarantee there will be social housing as part of this deal. I don’t believe for a second that the site [on College Road] will be used to build social housing. It’s the most incredible roundabout route for building social housing,” claimed Mr Curran.
This article first appeared in the print edition of the Galway City Tribune, October 7. You can support our journalism by subscribing to the Galway City Tribune HERE. The print edition is in shops every Friday.