contents
1PURPOSE OF THE TOOLKIT – SOME DEFINITIONS...... 3
2WHAT IS CAT TRYING TO ACHIEVE?......
3NATIONAL & LOCAL POLICY CONTEXT...... 4
4BACKGROUND...... 5
5CAT TOOLKIT PRINCIPLES...... 8
6CAT TOOLKIT ...... 16
APPENDIX A – PRE-APPLICATION CHECKLIST...... 24
APPENDIX B – sTAGe ONE APPLICATION GUIDANCE...... 25
APPENDIX C – STAGE TWO APPLICATION GUIDANCE...... 30
APPENDIX D – GENERAL RISK ASSESSMENT EXAMPLE...... 33
APPENDIX E – CASH-FLOW FORECAST EXAMPLE...... 42
APPENDIX F – REFERENCE...... 43
1Purpose of the Toolkit – some definitions
1.1The purpose of this Toolkit is to provide a clear framework for Milton Keynes’s future approach to Community Asset Transfer (CAT).
1.2This is within the context of local and national policy.
1.3The term ‘Community Asset Transfer’ relates primarily to freehold arrangements on built infrastructure at less than best price to voluntary/community organisations or Parish Councils.
1.4The term ‘built community infrastructure’ includes Council-ownedassets related to leisure and community facilities, libraries, open spaces, and a variety of other sites and venues and the possible transfer of these assets to community partners.
1.5‘Community Partners’ relates to all third party organisations such as Parishes, Town Councils, and the voluntary and community sector, including charitable and social enterprises, housing associations, and management committees.With this in mind, a preference will exist for such partners to belocally run, locally controlled, non-profit distributing, inclusive, and democraticorganisations with a track record and experience of delivering services to the localcommunity.
2What is CAT trying to achieve?
2.1CAT is part of a Council-wide Corporate Change Programme andis part of MKC Strategic Property Board which considers Land, Property and Facilities Management.
2.2The aim of CATis to work with community partners to provide and support the delivery of effective localcommunity assets and related servicesfor the people of Milton Keynes.
2.3The Council recognises the value of enabling local community partners to take more responsibility for local assets and wishes to empower these new arrangements with those organisations that may be best-placed to achieve this.
2.4 CAT has a focus on ‘built community infrastructure’ i.e. leisure and community facilities, libraries, open spaces, and a variety of other sites and centres, andthe possible transfer of these assets to community partners.
2.5 Where possible the freehold of each asset would transfer using the Council’s Well
Being Powers, but only if the value of the asset is below £2 million. Given their size,
their complexity, and the fact that such facilities generate significant income and serve
in some cases borough-wide catchment areas in terms of user groups, such facilities would be excluded under the CAT programme and instead other commissioning/transfer solutions sought as appropriate.
2.6It is also to ensure that community assets are delivered in a way that not only produces appropriate outcomes for residents but also delivers excellent value for money in line with the Council Plan.
2.7 Some key benefits of C.A.T.:
- Mutually beneficial, flexible, and a simple, proportionate, and appropriate process
- Meets a demonstrable local community need, contributes towards community empowerment and generating social, economic, or environmental benefits
- The application is made by a local, non-profit distributing Charity/community group/social enterprise or Parish Council
- The asset or value of the asset is protected and preserved for continuing community benefit
- A governing document ensures the applicant organisations are locally controlled, open to everyone in the community, democratic, and accountable.
- The applicant can prove it has the necessary skills and experience to deliver.
- There is a financial or business plan to ensure long-term sustainability
3.National and local policy context
3.1The 2006 Local Government White Paper, ‘Strong and Prosperous Communities’, confirmed the then Government’s intention to increase opportunities for community asset ownership and management.
3.2MK Council’s Community Facilities Unit historically has set up outsourced arrangements, such as through Trusts andleases, and has a strong track record ofworking closely with community partners.
3.3The later Quirk Review, ‘Making Assets Work’, published in May 2007, found that a careful increase in a community’s stake in an asset can bring a wide range of additional benefits for that community, the organisation receiving the asset, and the local authority facilitating the transfer.
3.4Following the change in Government in May 2010, the Localism Bill was introduced to Parliament on 13 December 2010. This Bill was given Royal assent in November 2011and its aim is to shift power from central government back into the hands of individuals, communities, and councils, the outcomes of which are for the direct benefit of the local community. It states that: ‘We want to pass significant new rights direct to communities and individuals, making it easier for them to get things done and achieve their ambitions for the place where they live’.
3.5As part of the emerging requirements of the Localism Act, a community ‘right to challenge’ has been introduced. Once enacted, the Right will give local communities the ability to register an interest to bid to take over a local public service which they would like to run differently or better. Under Community Asset Transfer a measure of social value will need to be incorporated into any approach to ensure that proper discussions are pursued in a fair, open, and consistent manner.
3.6Of wide interest across the third sector, the Actwill also include a community ‘right to bid’. This is the opportunity to bid to buy properties classified as community assets andthe third sector or Community Partners as referred to in this document may adopt a more supportive role to the community. The Government has cited meeting rooms, swimming pools, village shops, markets, and pubs as listed assets that might be purchased. It is likely that communities will need help and advice when embarking on any ‘right to bid’ projects and the Community Partners may be best placed to assist with this. This is a separate programme from CAT but is administered by the CAT team.
3.7CAT can contribute to the Council’s Corporate Plan and strategic objectives by rationalising its property portfolio and facilitating more effective and efficient use of its asset base, where the focus is on improvedcommunity outcomes.
3.8The Council will make available for community use those properties within its ownership which in the Council’s view are suitable in terms of planning use, location, size, and construction.
3.9The Council operate lettings in accordance with the Property Strategy and the Commercial Landlord Accreditation Scheme. As a responsible landlord we would therefore want to ensure that the management of a transfer of a property is operated in accordance with those principles and will form part of the transfer arrangements.
A thorough explanation of the scheme can be found at the link to the Council’s Property Strategy is available at:
4Background (Feasibility Study)
4.1During July and August 2011 approximately 700 Council assets were initially scoped under the programme. This originally included schools, althoughthese assets were subsequently taken out of the programme. The mechanism under which a school is considered for ‘academy’ or ‘free school’ status is dealt with under a different programme.
4.2Such scoping and challenge will continue throughout the programme across theCouncil’s service areas. In Phase One 50 properties were identified as amenable to transfer to community partners.
4.3There are currently 5 key programme strands, which are:
- Leisure and Community; meeting places, community centres, leisure centres, pools, and sports grounds.
- Arts and Heritage
- Libraries
- Youth Centres
- Open Spaces;parks, landscape depots
4.4 ‘Open Spaces – the Future’ is a programme that seeks to identify the most beneficial outcomes for the future management of open space throughout MK. The programme of work focuses on Council land currently outside the CAT programme. There are four key projects supporting this programme:
- Establish a process to manage and record all MKC’s current land assets and land use.This will enable the Council to accurately interrogate land ownership records necessary for land assets and management, and is also a required component for the successful outcome of the CAT programme
- Identify and record pieces of open space that are of strategic importance to the Council. This programme is divided into four sub- streams.
-Large Strategic Open Space
-Areas of Strategic value to MKC
-Areas with development opportunities
-Sundry areas (small pieces of incidental land)
- Establish a partnership framework strategy to maintain the quality of open space and contribute to communities’ ‘quality of life’ and ‘Well Being’ agendas. This programme seeks to develop a joint open space strategy between MKC, the Milton Keynes Parks’ Trust and Homes and Communities Agency (limited to publicly accessible land, but not limited to any particular land manager or owner)
- Open space maintenance and costs - this programme seeks to engage with local Parish and Town Councils and other not-for-profit organizations (including Milton Keynes Parks’ Trust, a charity) to identify and agree the future management of local areas of open space e.g. by local bodies specifying and paying for bespoke requirements (work includes local play areas)
‘Open Spaces – The Future’ needs to be able to supply the CAT programme with accurate records and land information upon request to ensure transfers can be completed. Additionally, as the programme develops the number of land assets to be transferred to other bodies may increase.
4.5How much effort will it take?
CAThas developed two options under Phase One, with a third option to be undertaken in Phase Two. As depicted below, asset transfer decisions are essentially a choice between:
Phase 1 (2012-14) / Phase 2 (estimated 2014-15 onwards)a) Existing management arrangements to continue
b) Transfer freehold of Community Asset Transferswith relevant covenants to protect community access and use
c)As above except MKC deliver a service within the asset under a partnership agreement with community partner / Other assets put forward as appropriate following a four-test financial assessment as to their suitability and these will be undertaken for each asset before they are considered (via DD) for possible inclusion into the programme. These are:
- The revenue cost to the council
- The potential future liability in terms of capital investment requirements.
- Possible income generating opportunities to the Council.
- Potential development opportunities.
Eligible assets are normally:
- Modest in size
- Serve identified very local communities
- Not the larger assets that serve a wider area of Milton Keynes
- Not assets which provide the Council with an income
Larger / Strategic Assets - where possible the freehold of each asset would transfer using the Council’s Wellbeing Powers - but only if the value of the asset is below £2 million. Given their size, their complexity, and the fact that such facilities generate significant income and serve in some cases borough-wide catchment areas in terms of user groups, such facilities would be excluded under this CAT programme and instead other commissioning / transfer solutions sought as appropriate.
4.6The typical process in Phase One will involve:
- Disposal of property highlighted at Strategic Property Group
- Receiving instructions from the client department (e.g. Leisure & Community)
- Obtaining and reviewing property deeds
- Identifying staff operating in or for the asset and the implications of the transfer; seeking advice from HR Business Partner and creating a HR project plan – this is identified before asset in tranche reaches Stage One.
- Provision of any planning consents relevant to the site – check with Highways
- Checking whether any existing funding arrangements contain clawback or similar arrangements which need to be dealt with before transfer.
.
- Instructingthe Legal department to prepare a report on title
- Reviewingthe report on title to understand claw-back, restrictions, conditions
- Arranging Energy Performance Certificates and providing reports to purchaser
- Negotiating and agreeing terms for freehold transfer/long leasehold (including dilapidations)
- Agreeingthe level of claw-back to be paid on completion of the transaction or obtaining user approval. (i.e. HCA)
- Preparing certificate of under-valuation and ensuring compliance with Well Being powers
- Reporting agreed terms in the Officer Decision Report in order to obtain formal approval from the Valuer and the Client
- Where applicable commencingthe Human Resources project plan, ensuring adherence to Milton Keynes Council policies and procedures and relevant employment legislation including TUPE
- Instructing Legal to proceed with transfer/prepare legal docs in accordance with agreed terms
- Legal process then depends on the circumstances and nature of transfer e.g. freehold
4.6Phase Two
4.6.1 Those Community Assets that have been identified in the first phase as properties not for transfer to Community Partners are mostly offices, shops, hostels and general housing accommodation which the Council wishes to retain because of their commercial use.
4.6.2 A number of community assets are managed contractuallyand are thus deemed out of scope. Also those assets considered to be of a more strategic or borough-wide importance and of benefit to people from a range of different communities would be retained by MKC and/ or considered as a package with a range of other Council assets to be outsourced from MKC under a Trust/contract procurement or other commissioning model as deemed appropriate and therefore will not be considered under Phase 2.
This list has been identified afterapproval fromMKC’s Strategic Board and then via a delegated decision. There are currently no further assets planned to enter Phase Two at the present time. However, there is always the opportunity to review the status of an asset deemed out of scope.
5C.A.T.Toolkit ‘Principles’
The Council will only consider asset transfer where the community partner has demonstrated the ability to suitably manage the building (although we recognise that organisations may be able to develop this capacity and they will be given the opportunity to do so if commitment and potential can be demonstrated).
There are various ways in which an asset can be transferred through this programme (freehold, leasehold, contract) and the pilots demonstrated that a ‘one size fits all’ approach to C.A.T. is unlikely to be the most effective. Some applicants (e.g. Town and Parish Councils) will have considerable capacity and expertise to support their bid and may be able to work within the proposed 16-week timescale. Others will require external support and a longer timescale (up to 6 months) to build the capacity they need to bid successfully. Developing a CAT process that is sufficiently flexible to meet these differing requirements will be one of the key challenges during the roll-out.
Working collaboratively and by allowing more time if necessary for potential applicants to consider submitting an application over and above the 4-week window (depending upon the needs of that particular community) following the initial public session may allow more flexibility for potential applicants to consider whether it is appropriate to submit or not and enable the chance for any respective committees to meet and discuss. This approach is being implemented in Phase 2.
More detailed information on the property has historically been shared at Stage Two. Now, the provision of information for assets that are being considered for transfer will be available online to aid potential applicants for stage one. This information will include:
- Financial details of the property (as appropriate)
- Leaseholder information
- Restrictive covenants (if any)
- Condition surveys (where available)
- Red-line plans of area to transfer
Officer contact details will also be made available should anyone wish to speak to them about the CAT process.
It is important to set out explicitly what is expected of both parties in any asset transfer to a community partner. During Stage Two it is important to clarify roles and responsibilities (for example in terms of repairs and maintenance) and how the asset will be run (maintaining open access etc.)
5.1Local control
Consultations to date have informed the criteria for determining asset transfer partners: a preference for partners to be locally run, locally controlled, non-profit distributing, inclusive, and democratic(the questions are covered in the new pre-checklist which will go online and be publicly visible/available) organisations with a track record and experience of deliveringservicesto the localcommunity.
Further analysis following pilot consultations defined locally run andlocally controlled as:
“50% of the Community Partners (e.g. Trustees, members, Parish/Town Council members) should live within the MK Unitary Boundary or within a 3-mile radius of Milton Keynes Centre”
Organisations will also have to provide evidence that equality and diversity policies are regularly monitored.
In order to demonstrate that the community partner has the skills, capacity, and track record of managing and / or delivering services within community buildings, the Council would ask that this is preferably over a minimum of five years.Shorter than this there would still be an opportunity for the applicant to bid; however, the applicant would be asked to demonstrate awareness of the organizational maturity required. At Stage One the community partner will be asked tocomplete a skills audit oftheirmanagement committee/board/council.