Agenda item

Financing the Yeovil Refresh

Meeting of District Executive, Thursday 17th February 2022 9.30 am (Item 147.)

Decision:

RESOLVED:	1. That District Executive recommends that the Chief Executive agrees to vire £850k from the Lump Sum Payments to County budget to fund other projects within the overall Public Realm programme as set out in paragraph 13, and as permitted under the Council’s Financial Procedure Regulations. 2.
	3. That District Executive recommends to Council to approve: 4.
	a.	an increase in the Yeovil Refresh capital budget of £1.059m to bring the total project total to £21.838m;
	b.	an increase in the Yeovil Refresh revenue budget of £0.606m to bring the total budget to £1.994m (in total over the length of the delivery period). This is proposed to be funded from the Regeneration Fund Reserve;
	c.	an increase to the council’s overall revenue budget of £0.044m (capital financing costs of borrowing £1.059m is £0.025m for interest costs and £0.019m for MRP) to fund the increased borrowing costs likely to be incurred by the project if the ring-fenced assets do not sell during 2022/23;
	d.	the creation of an earmarked reserve of £4.784m to pay for the possible pay back of the Future High Streets Funding grant received to-date.
Reason:	To update Members on the Yeovil Refresh budget requirements to enable the completion and delivery of a series of Refresh projects in 2022 and 2023, and, to approve an increase in the Refresh budget to enable delivery of the projects.

Minutes:

The Portfolio Holder for Protecting Core Services introduced the report in the absence of the Portfolio Holder for the Yeovil Refresh. He advised that the budget pressures had given officers some issues and he thanked them for their work on progressing the Yeovil Refresh to its current position. He noted that the Quedam shopping centre was at capacity once again.

The Regeneration Programme Manager said they had reached an exciting phase of the refresh as the physical works were beginning and there was a clearer idea of the construction costs so the capital costs in the report would allow all of the remaining public realm projects to be delivered. The revenue sum would allow events and activities to draw in shoppers and visitors. A difference in the layout of figures between the table in paragraph 13 and at paragraph 20 would be corrected in the Council agenda.

During discussion, it was noted that:-

· The public realm projects were doing well as they were under SSDC control but major developments relied upon developers and public transport relied on bus companies and transport orders.

· SSDC were not the only council facing the challenge of a 2:1 return on the Future High Streets Fund as they relied upon private developers to deliver some of the projects.

In response to questions from the Scrutiny Committee, the Regeneration Programme Manager and the Portfolio Holder for Economic Development advised:-

· The lump sum payments to County related to the on-going maintenance of new materials as SSDC were considered as a developer by SCC. This would only be paid for one year until the Unitary Council took over.

· If the projects listed under the Future High Streets Fund did not progress then SSDC have to return some of the funding to Central Government.

· Contingency plans were in place in case a contractor went into liquidation.

The Director for Place and Recovery advised that there was significant risk to the £4.8m Future High Streets Fund and in order to retain the funding, a cost to benefit ratio in excess of 2:1 must be demonstrated. There were potential housing applications coming forward which may make a difference and a report would be brought to District Executive in June or July 2022 when the outcome was clearer.

At the conclusion of the debate, Members were content to propose the recommendations to the Chief Executive and Council for confirmation.

RESOLVED:	1. That District Executive recommends that the Chief Executive agrees to vire £850k from the Lump Sum Payments to County budget to fund other projects within the overall Public Realm programme as set out in paragraph 13, and as permitted under the Council’s Financial Procedure Regulations. 2.
	3. That District Executive recommends to Council to approve: 4.
	a.	an increase in the Yeovil Refresh capital budget of £1.059m to bring the total project total to £21.838m;
	b.	an increase in the Yeovil Refresh revenue budget of £0.606m to bring the total budget to £1.994m (in total over the length of the delivery period). This is proposed to be funded from the Regeneration Fund Reserve;
	c.	an increase to the council’s overall revenue budget of £0.044m (capital financing costs of borrowing £1.059m is £0.025m for interest costs and £0.019m for MRP) to fund the increased borrowing costs likely to be incurred by the project if the ring-fenced assets do not sell during 2022/23;
	d.	the creation of an earmarked reserve of £4.784m to pay for the possible pay back of the Future High Streets Funding grant received to-date.
Reason:	To update Members on the Yeovil Refresh budget requirements to enable the completion and delivery of a series of Refresh projects in 2022 and 2023, and, to approve an increase in the Refresh budget to enable delivery of the projects.

Supporting documents:

Agenda item

Financing the Yeovil Refresh

Council and Democracy