ARC - VSA Agreement 2007 Rental Review

Council was requested by the Minister, as part of its 2007/08 Business Plan, to lead and facilitate the required six yearly review of the ARC - VSA Agreement and make recommendations to him in relation to revised rental arrangements.

The ARC - VSA Agreement was made in 1990 between the then land manager, the Alpine Resorts Commission, and the then Victorian Ski Association. While the Government's 2002 Alpine Resorts Leasing Policy now applies to all new leases, the 1990 Agreement still has application for the setting of site rentals on approximately 50 per cent of sites at Alpine Resorts.

The ARC - VSA Agreement provides that the site rent in the first year shall be the lesser of 3.5 per cent of site value or the rent from the last year of the previous rent period adjusted by the 'industry wide ceiling'. The Agreement states that the 'industry wide ceiling' shall be determined by the Minister after extensive consultation with associations representing the industry, but shall not be greater than 30 per cent above the sixth year of the preceeding rent period. Under provisions of the Agreement, site revaluations are conducted every six years for the purpose of rental adjustments, with annual adjustements in intervening years (other than the first year) in accordance with CPI. Site valuations as at 1 February 2007 form the basis of the current review, with revised site rentals to apply from 1 November 2007.

Council adopted a two stage process of consultation. Council representatives met with relevant peak bodies and requested the Alpine Resort Management Boards to undertake consultation with their individual resort stakeholder communities. Written submissions were invited.

Submissions received. (PDF 4.2 mb)

All submissions were considered and a report prepared. Council's report included Council's recommendation for the 'industry-wide ceiling'.

The Review Report (PDF 620 kb)

In line with the Agreement, the Minister has now made his determination as to the 'industry wide ceiling'. The Minister's advice to Council is attached.

Minister's Determination (82 kb)

The Alpine Resort Management Boards will now apply the Minister's determination in setting site rentals for all leases in their respective Alpine Resorts that are subject to the ARC - VSA Agreement.