The Clare Champion Clare news, sport, entertainment and local notes
Clare County Council has been asked for answers to a number of questions in relation to its approval in June 2021 of a €10 million loan for Ennis 2040, with the council confirming a total of €2.2m has so far been advanced to Ennis 2040 to fund the work programme underway.
At the March meeting of the local authority, Councillor Tom O’Callaghan (FF) called for a discussion to be allowed in relation to the council’s approval of a loan for €10 million. The details he requested were to include the cost of the loan and it’s duration, the schedule of loan repayments by the DAC, the list of assets owned by DAC currently, as well as the purpose of loans and if the council has guaranteed all liabilities. He also questioned whether the council is financially liable in any event of unfortunate financial misadventure. Chief Executive of Clare County Council, Pat Dowling, said he was concerned about the public focus being put on Ennis 2040.
“It is not a horse that is bolting out of control. I want to reassure all here today that we control everything as the over-sight body,” he said.
Noeleen Fitzgerald, Director of Finance and Support Services explained the purpose of subsidiaries within the council is not new saying the DAC is a type of company. She gave the example of glór and the Clare Community Trust describing them as “alternative vehicles deliveries for local government”. She added there is a lack of understanding of assets the council owns saying they are accounted for under the Accounts Act.
And in reply to the councillor’s question over the loan, she said the €2.2 million was the only amount transacted through, highlighting the local authority in itself does not borrow but the minster allows it to borrow.
“We have lent Ennis 2040 DAC €2.2 million. When the asset comes into play, we will have the first charge,” Ms Fitzgerald said.
She also said they have lent to other entities in the county citing Kilkee Water World as an example.
“Clare County Council has to date drawn down €5 million of this approved funding at December 31, 2023. This loan tranche was drawn for 20 years at a fixed interest rate of 2.6% with the first three years interest only. As of March 1, 2024 a total of €2.2m has been advanced to Ennis 2040 DAC for the purpose of funding the work programme underway,” said Ms Fitzgerald.
Answering the question about the schedule of loan repayments by the DAC, she confirmed that from year one to year three, the interest charge is €57,000 and from year four onwards, annual repayment depends on the level of draw down, estimated at €142,500 based on the amount drawn by the council to date.
In terms of the assets currently owned by DAC, she referred the council members to the council’s annual financial statement which lists the associate and subsidiary of the council, and asset values.
As of December 31, 2023 the draft net book value of assets owned by Ennis 2040 DAC amounted to €14,791.
And she clarified the purpose of the €10 million loan approved by the members at the June council meeting in 2021 was “working capital finance as preliminary expenditure on a planned works programme for Ennis 2040 DAC”.
She said the funds drawn down have been applied to the design, planning, and progression of key projects on behalf of the council like Abbey Street – retail and office, Francis Street, Harvey’s Quay, and the Post Office Field. The funds also covered company setup, ongoing operational costs and over heads, and such overheads are fully allocated to each project in proportion to the duration of time spent on each, she said.
In answer to the question about financial liability in an event of financial misadventure, Ms Fitzgerald said that, “Where loans are advanced for the development of infrastructure, this council secures the loan as a charge against the asset. Where the council have advanced loans to associate companies, we have secured these against the assets in order to protect this council against any risk.”
Sharon Dolan D'Arcy
Sharon Dolan D'Arcy is originally from Ennis. Her work as a print journalist has appeared in a number of regional publications. She worked as court reporter at The Sligo Weekender newspaper and is a former editor of The Athenry News and Views. She covers West Clare news.
