History of Kawerau Enterprise Agency

THE START: The KEA concept mooted by Graham Ogilvie of Tasman Pulp & Paper Co in 1984, following his visit to Britain where he had seen Enterprise Agencies backed by corporates. A steering committee was set up to develop the idea. It included Ron Wells, Graham Ogilivie, Ron Hardie, Bill Locker, Allan Baker, Bev Adlam, Frank Duxfield and Lyn Hartley. KEA was formed as an incorporated society, registered on the 14 March 1985. The initial funding was made up from: § Kawerau Borough Council $25000 § Tasman Pulp & Paper Co $25000 § Tasman Forestry $12500 § Tasman Lumber $12500 § Kawerau Business Assn $ 8076 § Govt (CEIS) $25000 This provided funding for the operation of KEA. In the first year, KEA took a head lease over the “Tasman Lodge” for use by small-scale businesses and part of the Tasman House for its own offices. The head lease arrangements were that KEA maintained the buildings, and paid a retainer of $1000 pa plus 50% of the rents (received from sub tenants) back to the landlord, Tasman P & P Co. This had a two-fold effect in that it created a direction of independence and maintained the assets of the town while creating the new business locations needed within the town. THE INDUSTRIAL PARK: As the above was a temporary measure, with Tasman due to dismantle the Tasman Lodge, KEA then set about raising capital to build an industrial park. Graham Ogilivie of Tasman Pulp & Paper Co saw this as a measure to assist the community to adjust to the forth-coming reductions in manning levels at the mill. Community Bonds were issued at high interest rates to attract ownership in the proposed development. This did not raise the full amount of capital required so, Tasman provided a loan to KEA for up to $1 million dollars, secured over the building and land of the Industrial Park The terms of this loan that it could be taken up partially or all as cash or guarantor facilities, for an indefinite period at 0% interest rates. All excess revenue generated by the Park was held in Trust until such a time as the Community Bonds were repaid first, and then Tasman loans were to be repaid. The first building, KEA, was quickly filled so a decision was made to build KEA 2 alongside. This was funded with another issue of Community Bonds and a further interest free loan from Tasman. Once all the bonds and loans were repaid, the industrial park would be freehold to KEA and provide a cash flow to fund its operations and further development. The park continues to enjoy occupancy of almost 90%, (two units currently empty) and given KEA significant profile. The income from the Park is not, however, available to fund other operations until the loans are repaid. Rent reductions are given to those tenants who employ greater numbers of staff, with these being reviewed quarterly. The Industrial Park has further land available for development, and there is adjacent land also available for industry. THE KEA CENTRE: The KEA Centre was formerly known as Tasman House. The building became surplus to Tasman's requirements so KEA purchased the land and buildings for approximately $100,000 on 1 July 1989. The purchase was funded by a mortgage taken out by KEA. This mortgage was repaid from revenue and some Government funding within 3 years. This site was further enhanced during 1990, when KEA added the ex Matahina School building as a resource centre. The total complex has provided a base for KEA and funded the KEA activities by more than $30,000 per year after all expenses of up grading have been taken into account. The KEA Centre provides office space and the occupancy rate is increasing all the time. It also has meeting facilities. MEMBERSHIP: The membership of KEA was primarily the Community Bondholders, with the cornerstone members (Fletcher Challenge Forest, Tasman Pulp & Paper, Kawerau District Council and the Kawerau Business Association) also being members. This was designed to maximise community ownership. Since the Community Bonds were repaid the only members remaining are the cornerstone members.