At an extraordinary council meeting held on Thursday, May 13, councillors received the report by external company Centium, which the council resolved to be undertaken in August last year.
The meeting’s agenda said it was the opinion of the council’s audit and risk committee that “there is sufficient evidence from Centium’s report of seriously important, outstanding questions to warrant referral to ICAC and NSW Police as authorities with the power to investigate thoroughly the MRE development, in particular the flow of MRC loan moneys to end beneficiaries”.
The decision was passed by councillors, with Cr Ann Crowe and Cr Geoff Wise voting against, and Cr Neil Gorey not at the meeting.
“Clearly we would rather it hadn’t happened and if there are procedural issues that need to be addressed, then we would see that as an opportunity to improve our processes internally,” Murray River Council Mayor Chris Bilkey said.
Cr Bilkey confirmed the period for the $900,000 loan the council made to Murray River Energy to be repaid had passed and no payment had been received.
The loan was made in return for the first mortgage on a property in Geelong and a decision will need to be made on whether to extend the loan or take action to retrieve it.
In November 2018, the council made a loan of $460,000 to the company to discharge a debt owed to Edward River Council through another investment vehicle, Dongmun Greentec.
Dongmun Greentec, later known as Deniliquin Ethanol Plant Pty Ltd, received development approval in 2016 for an ethanol plant in Deniliquin.
In 2014, the former Deniliquin Council loaned money to Dongmun Greentec to kickstart the development, but by the end of 2018, Edward River Council was threatening Supreme Court action to recover an outstanding portion of the loan.
Land owned by the company in Geelong was sold to repay the council, and finalised in 2019.
Little progress has been made on the development since then but the company made a request last year to purchase the Barham Rd land earmarked for the Deniliquin project and negotiations are ongoing.
According to the agenda from Murray River Council’s meeting yesterday, in November 2017, the then chief executive of the council was approached by the company to transfer the project from Edward River Council to Murray River Council.
In September 2018, the council bought a 193ha block of land on Mathoura-Line Rd for $1.2 million for MRE to build an ethanol plant and biodigester, without obtaining a registered valuation.
A memorandum of understanding was signed for MRE to subsequently buy the land.
In the meantime a five-year lease back to the previous landowner, with a five-year option, was signed, at a price later found to be lower than was possible by a registered valuer.
Last month, the NSW Office of Local Government confirmed it would conduct a section 430 investigation into the council’s involvement in the proposed ethanol plant development.
The council’s audit and risk committee considered the Centium report at a meeting on April 30.
Following legal advice sought by the council, the report will not be made public due to the naming of people in the document and the risk of defamation.
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