Agenda item

CARTREFI CROESO LTD FINANCING REQUIREMENT, APPOINTMENT OF DIRECTORS AND SHAREHOLDERS AGREEMENT DELEGATION.

Minutes:

(NOTE: Councillor H.A.L. Evans having earlier declared an interest in this item left the Council Chamber during its determination)

 

The Executive Board was reminded that at its meeting held on the 27th November, 2017 it had agreed to establish a wholly owned council housing company to build homes for sale and rent and act as a catalyst for further regeneration activities. In accordance with that decision, the Board gave consideration to a report detailing:

 

-        The company’s financing requirement – incorporating the company’s high level 2018-2023 Business Plan;

-        The process for the appointment of directors;

-        Shareholders Agreement Delegation.

 

Councillor D. Cundy, in accordance with CPR 11 referred to the appointment and role of the company directors and enquired how the Council, as 100% shareholder would measure the company’s success in terms of quality, quantity, financially and timeliness, and to how County Councillors would be able to peruse those factors for example via an AGM, Community Scrutiny Committee or other method.

 

The Executive Board Member, for Resources advised that the Company would have five directors comprising two Council Officers (unpaid) one county councillor (unpaid) and two external (paid) to be appointed by the Chief Executive, in accordance with the agreed procedures and in consultation with the Leader of the Council. The success of the company would be measured and monitored against the Business Plan, which may require revision as time progressed. The Council’s Section 151 Officer would be responsible for monitoring that and ensuring the Council’s interests were maintained.

 

The Chief Executive confirmed the company’s Business Plan would be submitted to the Community Scrutiny Committee annually. He also saw no reason why the company should not produce an annual report for submission to both the Executive Board and the Community Scrutiny Committee.

 

UNANIMOUSLY RESOLVED TO RECOMMEND TO COUNCIL THAT:

 

Financing Requirements

8.1

To note the Company’s high level 2018-2023 Business Plan as developed by the Council’s Housing Department/Communities Directorate, which will be refined following the detailed project feasibility studies and site investigations;

8.2

To agree to meet the Company’s 2017/18 establishment costs from existing revenue budgets to a maximum of £100,000;

8.3

To agree an Operating Cost Loan to the Company in respect of its 2018/19 operating costs to a maximum of £280,000. This to be transferred in 25% tranches, quarterly, in advance;

8.4

To agree a further Project Development Loan of a maximum of £750k, to be released in agreed tranches, to develop the detailed business of the company for further Council consideration, This loan will be utilised to progress:

·        Further development appraisal of eight sites, including 2 rural projects. This is to include detailed valuation, state aid , legal and taxation advice;

·        Detailed and comprehensive scheme development proposals/site investigations for three sites, including one rural, including:

·        Completing detailed financial modelling and securing associated legal and taxation advice.

·        Developing an effective procurement strategy.

·        Commissioning detailed technical appraisals and associated surveys such as site, soil, transport and ecological.

·        Undertaking liaison with utilities and statutory bodies.

·        Commissioning of detailed design brief and specification statement (which will also be utilised for following projects).

·        Receiving pre planning advice and completing pre planning consultation;

8.5

An initial £250,000 of the detailed Project Development Loan will be made available to the Company to progress the proof of concept. Approval of the release of further tranches of funding (up to the loan limit) is delegated to The Chief Executive and Director of Corporate Services, which will be released upon satisfactory commercial appraisal of the initial three proof of concept sites;

8.6

It is noted that requests for further loans for major development expenditure (for example, land transfer, professional fees, construction costs) will come forward as and when necessary and will form part of the detailed business plan to be completed once the individual site appraisals have been finalised;

8.7

Loan finance will be available at 3.5% above the rate set by the Public Works Loan Board (PWLB) for the Operating Cost Loan and 2.2% above the PWLB rate for the Project Development Loan. The conclusion of the detailed loan agreement to be delegated to the Chief Executive and Director of Corporate Services;

Appointment of Directors

8.8

The appointment and removal of Company Directors will be made by the Chief Executive, in consultation with the Leader of the Council, on behalf of the Executive Board;

8.9

That the Director for Communities (Jake Morgan), and Director of Regeneration and Policy (Wendy Walters) are appointed as directors of the company;

8.10

That a formal process is agreed for the appointment of the remaining Directors

Delegation of Issues relating to the Shareholder Agreement

8.11

To delegate (where possible) to the Chief Executive, following consultation with the Director of Corporate Services, authority to act on behalf of the shareholder with relation to the Shareholder Agreement.

 

Supporting documents: