The colony's main building is to be expanded and a toilet block added.
The remaining $150,000 will be funded by Tourism Waitaki. Tourism Waitaki general manager Jason Gaskill said the expansion was required to keep up with the number of visitors.
More than 75,000 people visited the colony each year. ''We are currently very, very tight when we have large crowds to provide adequate facilities. This extension is really to keep up with peak volumes.''
While happy to support the project, councillors Sally Hope and Melanie Tavendale expressed concerns that blueprints of the proposed expansion project were not provided. ''It should be something we can see,'' Cr Tavendale said. ''I find it disappointing the plans are not attached and there is no time frame as to when the loan will be paid back. There's so little actual detail here.''
Council chief financial officer Paul Hope said it was likely the loan would be repaid in about 10 years. He did not consider it to be a financial risk for council. ''The commitment is it will be a minimum cost to the council ... Council will not be worse off by approving this project.''
The land and buildings at the site are owned by the council, with the amount funded to be recovered through an amendment to the colony's lease between the council and Tourism Waitaki.
When asked by Cr Jim Hopkins if it was possible for Tourism Waitaki to one day buy the building, Tourism Waitaki chairman Marcus Brown said while it was an ''attractive proposal'', it was unlikely to happen. ''Our surplus is no great enough to do that.'' He added the expansion was essential given other penguin attractions a short distance from Oamaru. ''We are now facing competition within the industry, mainly in Dunedin and Timaru and elsewhere. If we want to be in the game, we have to update our facilities.''
The work is set to begin within six weeks.
- by Daniel Birchfield