1
contents
1 PURPOSE OF THE TOOLKIT – SOME DEFINITIONS 3
2 WHAT IS CAT TRYING TO ACHIEVE? 3
3 NATIONAL & LOCAL POLICY CONTEXT 4
4 BACKGROUND 5
5 CAT TOOLKIT PRINCIPLES 8
6 CAT TOOLKIT 36
appendix A - Pre Application Checklist 46
appendix B - stage one application guidance 47
appendix c - stage two application guidance 52
appendix D - CAt Feedback questionnaire 55
APPENDIX e – GENERAL RISK ASSESSMENT EXAMPLE 59
APPENDIX f – CASH-FLOW FORECAST EXAMPLE 68
APPENDIX g – REFERENCE 69
1 Purpose of the Toolkit – some definitions
1.1 The purpose of this Toolkit is to provide a clear framework for Milton Keynes’s future approach to Community Asset Transfer (CAT).
1.2 This is within the context of local and national policy.
1.3 The term ‘Community Asset Transfer’ relates primarily to freehold arrangements on built infrastructure at less than best price to voluntary/community organisations or Parish Councils.
1.4 The term ‘built community infrastructure’ includes Council-owned assets 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 be locally run, locally controlled, non-profit distributing, inclusive, and democratic organisations with a track record and experience of delivering services to the local community.
2 What is CAT trying to achieve?
2.1 CAT is part of a Council-wide Corporate Change Programme and is part of MKC Strategic Property Board which considers Land, Property and Facilities Management.
2.2 The aim of CAT is to work with community partners to provide and support the delivery of effective local community assets and related services for the people of Milton Keynes.
2.3 The 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, and the 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.
2.6 It 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. As part of the legal freehold transfer guarantees are put in place (in the form of community use covenants) that community benefit will be maintained in the long term by preventing sale or alternative uses.
2.7 Some key merits of C.A.T.:
o Mutually beneficial, flexible, and a simple, proportionate, and appropriate process
o Meets a demonstrable local community need, contributes towards community empowerment and generating social, economic, or environmental benefits
o The application is made by a local, non-profit distributing Charity/community group/social enterprise or Parish Council
o The asset or value of the asset is protected and preserved for continuing community benefit
o A governing document ensures the applicant organisations are locally controlled, open to everyone in the community, democratic, and accountable.
o The applicant can prove it has the necessary skills and experience to deliver.
o There is a financial or business plan to ensure long-term sustainability
3. National and local policy context
3.1 The 2006 Local Government White Paper, ‘Strong and Prosperous Communities’, confirmed the then Government’s intention to increase opportunities for community asset ownership and management.
3.2 MK Council’s Community Facilities historically has set up outsourced arrangements, such as through Trusts and leases, and has a strong track record of working closely with community partners.
3.3 The 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.
3.4 Following 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 2011 and 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’.
3.5 As 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. Separately, 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.
3.6 Of wide interest across the third sector, the Act will also include a community ‘right to bid’. This is the opportunity to bid to buy properties classified as community assets and the 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.
3.7 CAT 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 improved community outcomes.
3.8 The 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 (see 4.4).
3.9 The 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 http://www.clascheme.org.uk/index.html while the link to the Council’s Property Strategy is available at:
http://www.milton-keynes.gov.uk/assets/attach/22172/M14241%20Corp%20Property%20Strategy.pdf
4 Background (Feasibility Study)
4.1 During July and August 2011 approximately 700 Council assets were initially scoped under the programme. This originally included schools, although these 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.
4.2 Such scoping and challenge will continue throughout the programme across the Council’s service areas. In Phase One 50 properties were identified as amenable to transfer to community partners.
4.3 There are currently 5 key programme strands, which are:
1. Leisure and Community; meeting places, community centres, leisure centres, pools, and sports grounds.
2. Arts and Heritage
3. Libraries
4. Youth Centres
5. Open Spaces; parks, landscape depots
4.4 How much effort will it take?
CAT has implemented phase 1. The table below outlines the two delivery options and the approach going forwards into Phase 2:
Phase 1 (2012-15) / Phase 2 (estimated 2015-16 onwards)a) As part of the legal freehold transfer guarantees are put in place (in the form of community use covenants) that community benefit will be maintained in the long term by preventing sale or alternative uses.
b) As above except MKC deliver a service within the asset under a partnership agreement with community partner. (This model has been delivered in the Library transfers of Stony Stratford and Olney) / A four-test financial assessment process was added in 2014 to ensure that the Council would not be adversely affected financially with regards to any freehold asset transfer under CAT. These tests are as follows:
1. The revenue cost to the council
2. The potential future liability in terms of capital investment requirements.
3. Possible income generating opportunities to the Council.
4. Potential development opportunities.
No single aspect is considered more important than another but a balanced appraisal will need to be completed. Such an approach facilitates a clear and robust assessment of the assets being entered into the programme in a transparent manner.
In order to provide a greater level of transparency delegated decision approval is now needed for a group of assets to be put forward for consideration and entered into the programme.
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
4.5 The typical process within Legal and Property Services involves:
o Receiving instructions from the client department (e.g. Community Facilities)
o Obtaining and reviewing property deeds
o Provision of any planning consents relevant to the site – check with Highways
o Checking whether any existing funding arrangements contain clawback or similar arrangements which need to be dealt with before transfer.
.
o Legal prepare report on title
o Reviewing the report on title to understand claw-back, restrictions, conditions
o Arranging Energy Performance Certificates and providing reports to purchaser
o Agreeing terms for freehold transfer
o Agreeing the level of claw-back to be paid on completion of the transaction or obtaining user approval. (i.e. HCA)
o Preparing certificate of under-valuation and ensuring compliance with Well Being powers
o Legal to proceed with transfer/prepare legal docs in accordance with agreed terms
o Legal process then depends on the circumstances and nature of transfer e.g. freehold
4.6 Phase Two
4.6.1 Of the completed phase one transfers so far the majority have gone to parish or town Councils. Most are sports grounds, community centres or meeting places. Some phase one asset transfers are still in progress and are expected to be completed in 2015/16.
4.6.2 A review of potential Phase Two assets took place in late 2014 and reviewed the way in which the process would be delivered (see 5.3 & 5.4). In June 2015 a delegated decision was approved for seventeen assets to enter the programme in tranches. Implementation of Tranche One began in September 2015. 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.
4.6.3 On an asset-by-asset basis an evaluation as to whether an asset should go into the CAT programme is undertaken by individual service areas. Firstly, services across the Council will assess whether they are needed for direct council service delivery. Other key considerations will include whether the facility serves a wider strategy need (see also 4.4).If at any time an organisation wishes to challenge the out of scope categorisation that organisation can contact the CAT team for a discussion.
5 C.A.T. Toolkit ‘Principles’
5.1 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).
5.2 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 a longer timescale to build the capacity they need to bid successfully.
5.3 One of the more recent changes to the Toolkit is to allow more time (if necessary) for potential applicants to consider the option before submitting an application, which might mean over and above the usual four-week window following an initial open/public session. This will encourage a greater opportunity for the potential applicants to consider whether it is appropriate to submit or not by adopting a more collaborative approach.
5.4 Another recent consideration and change in Policy will be the provision of information and contact opportunities before an open/public session takes place. More detailed information on the property has historically been shared at Stage Two. Now, information will be made available on the web page in the lead up to the open/public session and this may include information on:
· 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.)