Denis Napthine is embroiled in a new regional grants row after his government took just one day to approve a $300,000 grant upgrade for a Warrnambool street where his former horse race partner is proposing the city's largest apartment complex.
On October 29, just days before going into pre-election mode, the government notified Warrnambool Council it had approved funds for an upgrade of Gilles St Warrnambool. The council made a formal application for the grant the day before.
Gilles St is also the location for a proposed $20 million, nine-level apartment complex, lodged with the council just weeks earlier by a mystery developer, Baybern Developments Pty Ltd.
Corporate searches reveal that Baybern's sole director is Colin McKenna, the wealthy Warrnambool businessman, who owns the thriving meat and dairy empire, Midfield Meat.
In April the The Age revealed Mr McKenna and Dr Napthine jointly owned racehorse Spin the Bottle, sparking a conflict-of-interest controversy around Dr Napthine's role as Premier, local MP, racing minister and racehorse owner, and public subsidies to booming businesses.
Last week The Saturday Age also revealed that the government approved a regional growth fund grant to assist the expansion of Midfield Meat onto council land, despite advice to Premier Napthine that such use of the fund was "not appropriate".
Two weeks ago Dr Napthine and Warrnambool mayor Mike Neoh announced the $850,000 upgrade of Gilles Street, in the south of the regional city's CBD, including the $300,000 grant.
The announcement of the Gilles Street upgrade surprised Cr Neoh's council colleagues, who have focused for many years on designing, and securing funds for, a separate scheme: a revamping of the central city area.
"It is very curious that this funding has been obtained when a major [apartment] development has now been lodged for the end of this little obscure street," said councillor and Liberal Party member Peter Hulin.
"I am deeply disturbed at many issues within our council and I have made the Premier aware of my concerns on numerous occasions."
A spokesman for Dr Napthine confirmed that the grant was in response to a council application, and finally approved by regional cities minister Peter Ryan.
"The Premier was not involved at any stage of the decision-making process.," said the spokesman.
He said the (first stage) of the project aimed to enhance the northern end of Gilles Street. This is a section of the CBD that has previously been referred to locally as "the Gaza Strip" due to its location between two busy nightclubs, and its reputation as a hotspot for violence, said the spokesman.
He said Dr Napthine had not known that Mr McKenna was behind the proposed apartment development, the biggest residential complex ever proposed in Warrnambool.
On the day of the announcement a senior council officer linked the funding of the Gilles Street works to Mr McKenna's apartment project, noting that the proposed tower "added to the need for modernising Gilles Street".
Cr Brian Kelson described the announcement as a "bolt out of the blue".
"I can't understand why we're acting on this at the speed we are with the CBD revitalisation being listed as number one on the council's priority list, " he said.
Warrnambool Council failed to respond to repeated requests for comment from The Age.
But it told the ABC it had had been in discussions about the Gilles St grant since January.
Public comment to the council on the McKenna apartment tower proposal closed on October 29.
