AGENDA ITEM 1

MIDDLESBROUGH COUNCIL

EXECUTIVE REPORT

Acklam Green Health and Community Facility

Mayor – Ray Mallon

Assistant Chief Executive – Karen E Robinson

Date – 13th November 2009

PURPOSE OF THE REPORT

  1. To seek Executive approval to proceed with the demolition of Whinney Banks Youth and Community Centre in order to enable a new Health and Community Facility to be built on the Whinney Banks school site and to assist in the wider regeneration of the Acklam Green area.
SUMMARY OF RECOMMENDATIONS
  1. That the Executive approves that the project proceeds as detailed in this report.

IF THIS IS A KEY DECISION WHICH KEY DECISION TEST APPLIES?

It is over the financial threshold (£75,000) / x
It has a significant impact on 2 or more wards / x
Non Key

DECISION IMPLEMENTATION DEADLINE

  1. For the purposes of the scrutiny call in procedure this report is

Non-urgent
Urgent report / x

If urgent please give full reasons

A report was presented to Executive on 13 October 2009, which outlined the need to progress the Acklam Green Health and Community Facility. This is a project that is led by West Middlesbrough Neighbourhood Trust but the Council is a key partner. The Council is required to deliver key actions including the demolition of the current Youth and Community Centre to enable the regeneration of the Acklam Green area and the development of a new Health and Community facility.

In order to enable the project to progress and meet contractual deadlines an in-principle decision was sought from Executive on 13 October 2009. The rationale behind the in-principle decision was recognition that due to the very tight contractual timetable taking and in-principle decision at full Executive followed by a final decision on 13th November 2009 was the only way in which all the legal documentation required could be agreed and drafted.

The report going to Executive on 13 November 2009 states that the conditions outlined in the previous report (13 October 2009) have been met and legal agreements are in place and awaiting signature, which can only occur once final Executive approval is granted.

Failure to meet tight contractual deadlines will result in the project failing and this would mean that the regeneration of the Whinney Banks area would be significantly delayed or might not occur at all.

BACKGROUND AND EXTERNAL CONSULTATION

  1. As reported to Executive on 13 October 2009, West Middlesbrough Neighbourhood Trust (WMNT) has, since 2004, been leading a project to redevelop the Acklam Green area of Middlesbrough; this project is part of the wider New Deal for Communities (NDC) programme. A key aspect of the regeneration of Acklam Green is the provision of the Acklam Green Health and Community Facility (the new facility), which will be located on the Whinney Banks School site and the demolition of the current Whinney Banks Youth and Community Facility (the current facility).
  2. The project has faced difficulties, which resulted in it being significantly delayed. During this time the assumptions and expectations underlying the project made by WMNT and Middlesbrough Council have undergone several changes and have been significantly different at various stages. However, WMNT and the Council have agreed to move forward on the basis of WMNT delivering the project with project management support from Tees Valley Housing and the Council acting as lender for a potential funding shortfall.

7.On 13 October 2009 the Executive took an in-principle decision to proceed with this project and to allow the current facility to be demolished before the new facility was built subject to the legal documents being signed that offer security to the Council that the new facility would be built and would offer an acceptable range of youth provision.

THE CURRENT POSITION

8.The report to Executive on 13 October 2009 stated that there were four issues that could prevent the project reaching a successful outcome, these were:

Timescale

Affordability

Legal documentation and issues

Interim provision.

9.An updated position statement on each of these issues is provided below.

Timescale
  1. When this project was originally scoped it was expected that the new facility would be available in advance of the current facility being demolished. However, a catch-22 situation arose in which the new facility wasn’t affordable until WMNT received the Bellway Receipt and the Bellway Receipt was conditional upon the current facility being demolished and a cleared site transferred to Bellway by May 2010 (the Bellway deadline).
  1. The Council agreeing to demolish the current facility in advance of the new facility being built will resolve this situation. However, to give certainty to the Council and stakeholders that the new facility will be built it has been agreed that WMNT will sign the contract for the new building by 30 November 2009, one month prior to the proposed closure of the current facility. Contract signature on the new building provides more than adequate confidence that the new building will be delivered.
Affordability
  1. There were two issues in relation to affordability:
  • A funding gap of £600,000 should the Bellway Receipt not materialise.
  • A gap of £100,000 resulting from the withdrawal of Connexions funding.
  1. The funding gap of £600,000 is unlikely to arise if the Bellway deadline is met. However, in order to enable WMNT to let the contract the Council has agreed to extend a loan facility to WMNT for £600,000 and this has been secured against WMNT assets of equal value.
  1. Council officers have identified £100,000 funding from the Council’s capital programme to bridge the gap arising from the withdrawal of Connexions funding which the Council had previously agreed would be used to support this project.
Legal Documentation and issues
  1. The main concern regarding the legal documentation was that it would not be possible to complete all the legal paperwork in particular the lease and the sub-lease by the required deadline.
  1. The Council and WMNT have reached agreement on all the key issues that need reflecting in the legal documentation. The legal documents have been drafted and agreed by both parties; they will be signed and become effective once Executive approval to proceed is provided.
  1. A summary of the main points contained within the legal documentation is provided below:
  • The Council will grant WMNT a 99-year lease with peppercorn rent on land owned by the Council at Whinney Banks School. Should WMNT become insolvent the new facility would transfer to Middlesbrough Council. WMNT cannot take out a loan secured on the new facility although a provision for this to be discussed in the future is addressed in a side letter to the lease. The Council (as landlord) is required to give approval to the terms of any alcoholic licence; any licence granted would be for specific events only e.g. weddings.
  • WMNT will provide the Council with an under-lease that enables the Council to occupy the youth suite within the new facility with the Council contributing £35,000 per annum towards the upkeep of the building; this contribution includes all utility costs.
  • A shared user agreement has been agreed which details how the Council will be able to use the new facility and also provides assurance that WMNT will operate the new facility to ensure that all safeguarding issues are addressed. Details of the wider use of the new facility by the Council are provided in Appendix 1.
  • A Facility Agreement has been agreed which provides details of the terms of the loan facility that the Council would extend to WMNT should it be required and provides details of WMNT’s assets of equal value against which the loan would be secured.
  • The project proceeding is dependent upon WMNT reaching contract signature for the new facility by 30 November 2009. Failure to do so would mean that the Council would not be required to vacate the current facility by 31 December 2009.
  • The costs of providing interim provision for youth service will be met by Middlesbrough Council and WMNT on a 50/50 basis, capped at a £35,000 per annum contribution from WMNT.
Interim provision
  1. WMNT and the Council are liaising with current users of the centre to identify interim provision, where possible. These discussions are at a relatively early stage but a number of current centre users have been contacted to establish and understand their requirements and also to discuss and explore suitable options. A number of user groups of the centre travel from across the town and surrounding areas and therefore can travel to other locations to carry out activities. Discussions have taken place with community groups some of whom may relocate to other centres that are nearer to their users.
  1. Following a consultation evening on Thursday 22 October 2009 at Whinney Banks Youth and Community Centre it was agreed that a working group made up of young people would be established to work with Middlesbrough Council and WMNT to look at interim provision and requirements for youth activities following the closure of the current centre. The Youth Service has undertaken some preliminary work to identify interim service provision options; these will be discussed with the young people before being progressed.

EQUALITY IMPACT ASSESSMENT

  1. An Equality Impact Assessment has been undertaken and is attached at Appendix 2.

OPTION APPRAISAL/RISK ASSESSMENT

21. Option 1 – Do not proceed. The Council could decide not to proceed with this project. Youth provision would continue from the current centre until the new youth facility ‘My-Place’ was operational after which a review of youth provision across the town would be undertaken. Community and library provision would also continue.

  1. This would have a significant adverse impact upon the regeneration of the Acklam Green area of Middlesbrough and would probably result in significant delays to this. Residents have been expecting progress on the new facility for many years; their expectations would not be met.
  1. The Council is unlikely to view investment in the current facility as value for money particularly as it is not Disability Discrimination Act (DDA) compliant and compliance cannot be addressed in a cost-effective way due to the layout of the current site. It is probable that the current facility would, due to maintenance issues, be closed at some point in the future leaving the area with no youth or community provision.
  1. The Council provided land to WMNT at nil consideration to further the WMNT Delivery Plan; it is likely that failure to proceed would result in protracted legal discussions regarding use of the funds generated from the sale of this land and also the future of the land still in WMNT’s ownership.
  1. Option 2 – (Preferred Option) Proceed. Proceed with the project on the basis outlined above. The legal documentation required to provide security to the Council and WMNT is in place. Progressing with this option will result in a new facility for the community and assist in the regeneration of Acklam Green.

FINANCIAL, LEGAL AND WARD IMPLICATIONS

  1. Financial – The main financial risks relating to the capital build of the project remain with WMNT. There is a financial risk relating to the £600,000 that the Council has agreed to lend. However, if the project is delivered as planned and the Bellway receipt received in May 2010 the Council’s funds will not be required and will be returned to the Capital Programme. Should Council funding be required, then WMNT will repay these funds by October 2011 or the Council will be able to recover the Council funds used from other WMNT assets.
  1. Ward Implications – This impacts mainly on the Ayresome and Acklam wards with a lesser impact on the Kader ward.
  1. Legal Implications – The legal issues are covered in the legal documentation prepared. However, as the leases granted are for 99 years it is possible that during the term of the lease a scenario will arise that the lease and sub-lease do not make reference to; this would be negotiated by WMNT and the Council as and when necessary.
RECOMMENDATIONS
  1. That Executive approve the project proceeds as detailed in this report.
REASONS
  1. To assist in the delivery of the Acklam Green Health and Community Facility and the wider regeneration of the Acklam Green area.
BACKGROUND PAPERS

The following background papers were used in the preparation of this report:

Executive Report 13th October 2009.

AUTHOR: Karen E Robinson

TEL NO: 729117

______

Address:

Website:

APPENDIX 1

YOUTH SERVICE – AGREED USE OF THE WIDER FACILITY

  • Office accommodation for staff from the new Integrated Youth Support Team. This arrangement will include shared access to a reception and waiting area function and meeting facilities in the main building.
  • A separate entrance to the building for youth access when appropriate. This has been agreed on the basis that young people and youth service providers would also have access to the main facilities of the building (via an internal access route) as and when appropriate and subject to booking arrangements.
  • Daytime access to facilities in the Youth Zone from 8am to 10pm Monday to Sunday.
  • Access to wider facilities, as agreed, during the centre’s opening hours (8am – 10pm Monday to Saturday).
  • Use of the Multi-Use Games Area (MUGA) for 40 hours per week, this includes evenings and weekends. The MUGA can be used for tennis, basketball and football.
  • Use of the football pitches between 10am – 3pm during school holidays and for one hour per night three nights per week.
  • Use of the main hall for drama and music projects three nights per week.
  • Safe and secure arrangements in place for changing rooms and sports activity areas which address the potential safeguarding risks arising from the shared use of the building by young people and adults from the wider community.
  • Local young people to be actively involved in the design, planning and ongoing review of how services are delivered from the new building.

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