Catholic Church possible saviour of Acacia school

THE Uniting Church accrued more than $40 million in debt bailing out the developer of Acacia College after he ran into financial difficulties during the global financial crisis.

However, it was shocked to learn six weeks ago that the developer - who recently died on a plane - had not fully divulged a range of fees including the $10 million the City of Whittlesea demanded it spend on traffic works outside the school.

Acacia College had also accrued thousands of dollars in unpaid school fees and had a staff to student ratio of one to nine - far lower than the average ratio of one to 21.

The Age has learnt it was these factors that convinced the church Acacia College was unsustainable, prompting the shock announcement it would close at the end of the year.

''It's a scary amount of money,'' a Uniting Church member told The Age.

''All of the synod of Victoria and Tasmania will be affected because the only way to clear this debt is by property sales and the realisation of assets.''

The Uniting Church would retain the debt even if a new developer or buyer was found.

The Catholic Church has come forward as a potential saviour with Catholic Education executive director Stephen Elder saying he had held discussions with the Uniting Church and was currently doing due diligence.

The potential white knight came as furious parents accused the Uniting Church of a lack of disclosure and due diligence.

The church had originally planned to lease the school from the developer, Bruce Dorgan, but took on responsibility for funding its construction when the developer hit financial trouble in 2008.

Parent Naomi Robertson, from Whittlesea, who has four children, one of whom is in year 7 at the stricken college, said: ''We were set for the next 20 years, we are just devastated.''

Another parent, Adrian Donaghey, said his seven-year-old daughter had no school to attend next year.

''The Uniting Church must be held accountable for their complete incompetence in ensuring the good governance of Acacia,'' he said.

Uniting Church moderator Isabel Thomas Dobson said the synod was forced to inject more money than it intended to keep the two-year-old college's building projects going. The cost of installing lights and infrastructure such as roads alone was estimated at about $10 million.

''We did do due diligence. We've since discovered our due diligence wasn't diligent or detailed enough and it's in the last six weeks as we review other figures that we found there were substantial things that had been underestimated that has brought us to this decision,'' Ms Thomas Dobson said.

Principal Andrew Houghton tearfully read a statement yesterday saying the church and not the college board had decided to close the school. ''This is the worst day of my life,'' Mr Houghton said. ''As a community we are coming to terms with the decision the Uniting Church has made. I will be working with our parents and the Uniting Church to explore all opportunities to keep this fantastic school open.'' He said schools had offered to take students from next year.

City of Whittlesea chief executive David Turnbull said the decision to close the school had taken the council by surprise.

The Victorian government said it did not have the capacity to bail out the school.

The Uniting Church learnt the school's future was in jeopardy six weeks before it revealed its plans on Wednesday.

But Ms Thomas Dobson said parents and teachers were informed as soon as possible.

Meanwhile, the sacked principal of Methodist Ladies College, Rosa Storelli, pulled out of a meeting of supporters last night. The Age believes Ms Storelli's lawyers warned her against appearing.

With Deborah Gough

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