The Hon. Ron Hoenig MP, Minister for Local Government has given Kiama Council more time to fix its budget. That means there is no longer any reason to rush decisions about the holiday parks, Blue Haven Terralong, or waste collection. The community has until 24 May to make a submission, and this post explains what to ask for and why it matters.
Today the Minister for Local Government Ron Hoenig sent out a media release proposing changes to Kiama Council’s Performance Improvement Order. His office made sure it reached the community directly.
Here is what it says and why every person in Kiama should read it carefully.
First, the good news
The minister is giving council an extra twelve months to balance the budget. The new deadline is 2027-28 instead of 2026-27.
That sounds dry. Here is what it actually means.
The reason council was moving so fast on the Reflections holiday parks deal, from a Friday proposal to a secret Tuesday night vote, was budget pressure. Get a deal done, fix the deficit, move on.
That pressure has just been reduced by twelve months.
And the extended deadline means council will not have to cut libraries, youth services, the Leisure Centre, the Visitor Information Centre or the Pilot’s Cottage Museum. That matters to a lot of Kiama families and it is genuinely good news worth acknowledging.
So the community can now reasonably ask why council would keep rushing a decision about its most valuable community assets when the minister has just said there is time to do this properly.
Blue Haven Terralong
The minister is requiring council to get an independent business case done for Blue Haven Terralong. Not a council business case. An independent one.
Why is this distinction important? Because Blue Haven Terralong needs $51.2 million in maintenance and capital works over the next ten years just to get from a poor condition rating to an average one. There are fire safety compliance issues. The people who live there are some of Kiama’s most vulnerable residents. It is their home.
Council already sold Blue Haven Bonaira, its aged care home, to a Perth based operator last year. The community needs to watch carefully what the independent business case recommends for Terralong and whether residents get a genuine say before anything changes.
It is also worth knowing that the draft Operational Plan currently on public exhibition opens its Retirement Village Operations section with the phrase “pending market sounding.” That language sits in a document about a service for vulnerable residents, and it is a fair question to ask what market sounding has been done, with whom, and on what terms.
An independent report recommending a sale or transfer to a private operator is not the same as the community agreeing that is the right outcome. One is a document. The other is a decision. Do not let anyone confuse them.
The waste services question and why this stands out
This is the part of the media release that deserves the most attention and has received the least.
The minister is explicitly requiring council to keep domestic waste services in house.
In November last year council’s CEO issued a public statement saying council was not outsourcing domestic waste services and that anyone suggesting otherwise was wrong.
Then the minister put the prohibition in writing as a formal condition.
Those two things do not sit comfortably together. And here is what makes the gap harder to explain away.
Council’s own draft Operational Plan for 2026-27, the document currently on public exhibition and inviting your submissions, contains the following deliverables:
2.3.2.4.1 – Undertake planning work and design for merged depot at Minnamurra
2.3.2.4.2 – Prepare for regional/testing market for waste collection services. Undertake testing and document results
4.1.3.2.1 – Specifications for waste collection trucks reviewed and ready for tender, including improved telematics and data capture technology
Testing the market is the language councils use when they are sounding out external providers. It is the step that comes before a tender. Reviewing truck specifications ready for tender is the step after that.
These are not hypothetical. They are scheduled deliverables in a draft plan dated 30 April 2026, published by council, sitting on the council website right now.
The minister’s prohibition is not addressing something theoretical. It is addressing something council had written down.
The community deserves a straight answer about how the CEO’s November statement and the deliverables in the draft Operational Plan are meant to be reconciled. One of them needs to be revised. The community is entitled to know which one.
The holiday parks. What the media releases have not told you.
The minister’s proposed variation includes one line about the parks. It says the extra time will allow council to investigate opportunities for the long term management of its tourist parks which could improve its budget position over time.
Notice the words. Investigate. Over time. Not rush. Not this year. Not before 24 May.
It is also worth noting that the draft Operational Plan contains a deliverable under holiday parks for “new management contracts developed for upcoming year and Management Model review as per the Service Review to be progressed.” That is council scheduling new management contracts for the parks within the financial year covered by this plan. The minister has just said investigate over time. Those two timelines do not match.
Here is the context most people in Kiama do not have.
Four of the five holiday parks are on Crown land. Under the Crown Lands Management Act 2016 the state government can remove council as manager of those parks for no reason and pay council nothing in compensation. That is not a worst case scenario. That is what the law actually says.
This means the Reflections proposal is not a straightforward commercial negotiation between two equal parties. It is a council that knows it could lose the parks anyway sitting across the table from a government owned corporation. That changes everything about how you assess the deal.
Here is the part that should make every ratepayer sit up.
If the four Crown land parks go to Reflections, the revenue from those parks goes to Crown Lands, not to Kiama Council. The only financial benefit to council is that it no longer has to pay to run them. That is a cost saving, not a revenue generator. It is a very different thing from what the mayor has been saying about eliminating the deficit and generating revenue.
Council’s own published financial statements show exactly how much the parks earn each year. Those figures are in the Special Purpose Statements. The community should be asking council to explain, using those actual numbers, how handing the parks to a government owned corporation improves the budget when council stops receiving the income.
And then there is Kendalls Beach.
Kendalls Beach is the only park not on Crown land. Council owns it outright. It is the only park where council keeps all the money regardless of what happens. The community deserves to know what is being proposed specifically for Kendalls. Because if Kendalls is being bundled into a deal with the Crown land parks, council is giving away the one asset in the group it actually has full commercial control over.
The Snowy Valleys precedent. Read this carefully.
There is a precedent worth knowing about and every Kiama ratepayer should read it carefully.
Snowy Valleys Council ran a similar EOI process for its caravan parks. Reflections put in an offer. The council’s own assessment panel looked at all the offers on the table and found Reflections’ offer was below market rate compared with what other operators had submitted. The panel recommended council reject it. Council followed its panel’s advice and said no.
Then the Minister removed Snowy Valleys Council as Crown Land Manager of the parks. Not because council had done anything wrong. Because the Minister can. The law says so. Reflections was appointed in council’s place.
The council said no. The minister overrode them anyway.
That is the legal reality sitting behind every conversation Kiama Council is having with Reflections right now. A voluntary deal that is the alternative to an involuntary one is not genuinely voluntary.
The bigger picture
The PIO extension gives council time and it gives the minister political cover. If council rushes the holiday parks deal anyway that is council’s call to make and council’s consequences to wear. The minister has put the careful path on the record.
The community’s job is to make sure council takes it.
Update: Council has now responded
Council welcomed the minister’s proposed variation today and the mayor confirmed he met Minister Hoenig directly at Parliament House last week before this announcement was made.
But the CEO’s response raises a question that needs a plain language answer before 24 May.
She says the holiday parks deal is the mechanism for clearing the deficit. Her words: our ability to clear the projected deficit is certain, provided we can get through the tender process with a successful outcome.
If that is true, the community deserves to understand exactly how the deal clears the deficit when revenue from the four Crown land parks would flow to Crown Lands rather than to Kiama Council under the Crown Lands Management Act.
The numbers are in the published financial statements. The community is entitled to a straight answer before the submission window closes on 24 May.
The CEO also thanked the United Services Union for lobbying the minister directly to include the requirement that waste services stay in house. The union that represents waste workers felt it necessary to go to the minister themselves to get that protection in writing. If outsourcing was genuinely never being considered, why did the union need to do that?
And one more thing. Premier Chris Minns and his ministers are coming to Kiama next Tuesday for a Community Cabinet at The Pavilion. That is a direct opportunity for the community to ask the questions that have not yet been answered about the holiday parks, Blue Haven Terralong and waste services.
Be there. Bring your questions.
What the community should be asking right now
Before any decision is made on the holiday parks, council should answer these questions publicly.
Using the actual figures from the published financial statements, how does handing the Crown land parks to Reflections improve the budget when the revenue stops coming to council?
What is being offered specifically for Kendalls Beach and why?
Were there any discussions between Reflections, Crown Lands or the NSW Government and council before the unsolicited proposal arrived on 17 April? The mayor has confirmed he met the minister at Parliament House last week. Were the holiday parks part of that conversation?
Will there be a dedicated community engagement process on the Crown land parks before any lease is signed, separate from the current budget submission window which closes 24 May?
How are the waste collection market testing and tender preparation deliverables in the draft Operational Plan to be reconciled with the CEO’s November statement that domestic waste outsourcing was not being considered?
What does the independent business case process for Blue Haven Terralong look like, what does pending market sounding in the draft Operational Plan refer to, and how will residents and the broader community have a genuine say before any decision about its future is made?
The bottom line
The minister has done several things today that are genuinely in this community’s interest. He has required an independent assessment of Blue Haven Terralong. He has explicitly stopped council from outsourcing waste services. He has slowed down the holiday parks process and named it as something to investigate properly rather than urgently.
He has also, without quite saying so, raised a serious question about the gap between what community members were told about waste services in November and what is written down in council’s own draft Operational Plan today.
The community now has more time and more information than it did yesterday. The question is whether council will use both honestly.
The information exists. The honest conversation about what it means has not happened yet.
A step by step guide to making a submission on the current budget and Delivery Program before 24 May is here
Want to go deeper?
Kiama Council released its next meeting agenda today. All 1000 pages of it. A community member has analysed the key sections relevant to the holiday parks, the budget and Blue Haven Terralong. Read their analysis here
And if you want the devil in the detail:
Crown Lands Management Act 2016: https://legislation.nsw.gov.au/view/html/inforce/current/act-2016-058
Kiama Council Annual Financial Statements (Special Purpose Statements are in Part 2): https://www.kiama.nsw.gov.au/Council/Community-Reports/Annual-Reports-and-Financial-Statements
NSW Office of Local Government Performance Improvement Orders: https://www.olg.nsw.gov.au/councils/performance-improvement-orders/
Another excellent piece by Lynne Strong. It yet again evidences a Council CEO-led agenda starkly contrary to many of the best interests and sound future direction of the Kiama LGA community. The Minister has once again had to step in, very much like a Council Administrator would, to bring reason and good sense to a CEO-directed Council and its services and processes that the community increasingly senses and sees as damaging, not constructive and unsupportive, to the people who elect it.
We could all have avoided the trauma of the current rushed and counter productive Council budget public comment process if the CEO and most of the councillors had not opposed Cr Mike Cains’ motion at the April Council meeting proposing Council write to the Minister suggesting just such a course of action that the Minister has just announced this week.
Council’s opposition to Cr Caines’ motion was just another of the many examples in recent years of Council making decisions lacking common sense and practicality and unaligned with a community that best knows what it wants and deserves.
We should not have to expect the Minister to step in every time to get this wayward Council back on track but until something changes in that body permanently and for the better, thank heavens the Minister is watching and guiding and directing.
– Graham Pike
Jamberoo
Thanks Graham. I went to the April minutes and you’re correct on the substance. On 21 April 2026, Cr Cains moved a notice of motion (seconded by Cr Tatrai) asking council to write to Minister Hoenig seeking clarification on three things — whether failing to balance the 2026-27 budget would trigger an administrator, whether short-term deficit budgeting alongside a long-term sustainability strategy would be acceptable, and what flexibility council had on essential services. The motion also asked the Minister for relevant policy documents, guidelines and precedents ahead of the 19 May meeting.
The motion was lost 5-3. Voting against: Larkins, Lawton, Matters, McDonald and Warren. Voting for: Brown, Cains and Tatrai.
Three weeks later the Mayor was at Parliament House with Minister Hoenig “confident of a positive outcome.” Two weeks after that the Minister announced a variation that effectively answers Cains’ questions in the affirmative.
So you’re right. There was a clear path, formally proposed, on the record. Council voted it down. I think that deserves its own post.
Yet another demonstration, if any were needed, as to why the Minister for Local Government has to continue to be, in effect, an Administrator of Kiama Council and its administration.
– Graham Pike
Jamberoo