Central Otago District Council is defending its decision to end a longstanding rent rebate and increase the Cromwell speedway club’s lease to $50,000 per year, saying not doing so would be “unfair” to other local clubs. 

But it is a move Central Motor Speedway club leaders say has left the community motorsport venue fighting for survival. 

A previously confidential report detailing the decision - originally made by the Cromwell Community Board before being ratified by the wider council at a meeting last month - was released to the public on Monday (August 11). 

In a statement to The Central App a council spokesperson clarified the rationale behind the rent increase, pointing to obligations tied to the land’s endowment status and the evolving scale of the club’s operations. 

The spokesperson said the speedway grounds are situated on “endowment land”, gifted to the council with the purpose of benefiting the community and generating funds for council activities.  

“Any lease granted on endowment land would reflect a market rent for this land, based on market rent valuation," they said. 

The current market valuation, conducted in April 2025, set the rent at $50,000 per annum plus GST, ending a 20-year arrangement where the club paid significantly less after receiving rent rebates. 

Originally, the annual rent was set at $10,500 in 2005, but the club paid just $1,800 annually after rebates.  

“The Cromwell Community Board gave the original rebate because the Cromwell Speedway was a small and developing club,” the spokesperson said. 

Then, a rent review in 2015 increased the rent to $20,500, but again the club paid only $2,000 after rebates. 

The community board, supported by council, decided to stop further rebates because it considered the club had grown beyond a “small community club” and that continuing to subsidise it was “unfair” to other clubs with less income, the spokesperson said. 

Early on, the council also established a special reserve fund, essentially “ringfencing” rental income paid by the speedway over the decades, which the club could apply to for grants supporting infrastructure upgrades.  

“Over the last 20 years, speedway has received over $200,000 in grants to assist with upgrades to their infrastructure and facilities,” the spokesperson said. 

Despite the council’s defence, speedway leaders maintain the rent increase threatens their existence. 

Speaking to The Central App after a third request to the council to reconsider the lease terms was declined, Central Motor Speedway president Claire Arkell said it felt like the council didn’t want the speedway to remain at its current location “at all”. 

She said the speedway brought economic benefits to the wider community, with drivers, crew and spectators staying in local accommodation, buying food and fuel, and supporting Cromwell businesses. 

With upcoming costs such as fencing and track surface replacement looming, the club’s future remains uncertain.  

“Our club made a significant loss - over $80,000 - last financial year, and a further $20,000 the year before,” she said.  

“With the anticipated increase in water rates too, we are facing a significant increase in council expenses alone.” 

According to the council, the speedway lease does not fall within the Community Leasing and Licensing Policy, which typically allows for peppercorn rents for community groups, because of its location on endowment land.

Read more: Lease hike lease Cromwell speedway fighting for survivial

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