Central Coast Council has outlined a plan to shed 20 per cent of its staff, sell up to $60 million worth of assets and borrow $150 million in a bid to dig itself out of a financial black hole.
A first quarter business report indicates that the council's projected financial position at 30 June 2021 will be a loss of $115.1 million. It follows a $89 million loss for last financial year.
Administrator Dick Persson said the council parlous financial situation was the result of its failure to understand or practise the basics of sound financial management.
"The investigation has found no evidence of theft or corruption," he wrote.
"The newly amalgamated council clearly did not understand how much money they had at the outset. They set about a program of expanded capital works and expanded services that they could not afford.
A business recovery plan outlines a series of actions that the council is taking to improve its financials.
This includes reducing the staff headcount back to pre-amalgamation numbers from over 2,500 to under 2000. It is estimated this initiative will result in cost savings of $30million.
The council is aiming to reduce its materials and contracts by $20million. It will also obtain bank loans worth $150million and sell $40-$60million in underperforming assets.
Mr Persson canvassed the possibility of offloading the council's water assets late last year.
If this were to occur it is likely that it would be merged with Hunter Water.
"The water business is a good business and it makes a profit; anything you sell you give up the revenue stream," Mr Persson said.
"There's no chance that it would be sold privately, the question is whether the state government would be interested in acquiring it and linking it with Hunter (Water)."
Hunter Water said it had not had any contact with Central Coast Water about a possible merger.