Update: The $2.5 Million Wagga City Council Investment In Douglas Aerospace Pty Ltd
The $2.5 million Wagga City Council investment into a private aircraft refurbishment company operating at Wagga Airport will now run eight months late.
Douglas Aerospace Pty Ltd was set to centralise its business by last month, but now the aircraft hangar will not be up and running until the end of the year.
According to council's director of commercial and economic development, Peter Adams, no money has been released by council yet, having struck a deal to provide a loan to the company over 15 years at an interest rate of 6.8 per cent.
The loan will be secured by a mortgage over the hangar, and the rent will be free for the first five years under a 13-year lease agreement.
It is also believed an additional aviation business is looking to become involved in the deal.
Present director of Douglas Aerospace Douglas Clarke has been running various companies in the industry in multiple locations around Australia for decades.
Family members have also operated aircraft refurbishment businesses, and Mr Clarke would not rule out their involvement in the Wagga project.
The Wagga deal is expected to bring 40 jobs to the city, Mr Clarke confirming the most he had previously employed was about 25.
This will be different because the size of the aircraft hangar and its operations, Mr Clarke said.
"Part of the delay has been expanding on the initial project," he said.
"The council's work isn't completed yet also | their work won't be completed until later as they had delays because of the floods.
The Clarke family has run aircraft refurbishment operations in including Tocumwal, Cairns, Yarrawonga, Albury, Darwin and Adelaide.
When the deal was announced last year, president of the Wagga Business Chamber, Julian McLaren, said he did not agree with the loan because a council should not invest ratepayer money into private business.
Despite this, mayor Kerry Pascoe, who voted in favour of the loan, said he continued to support the venture.
"We've had a report and staff have convinced us this is a deal that is beneficial to our operations to the airport and will show a return to council," he said.
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