POLICY AND RESOURCES COMMITTEE

18 September 2019

Innovation Centre Project

Final Decision-Maker

Policy and Resources Committee

Lead Head of Service

John Foster – Head of Regeneration and Economic Development

Lead Officer and Report Author

Mandy Samrai – Interim Innovation Centre Manager

Classification

Public

Exempt Appendix 1

Exempt Category        

The information contained within the report has been considered exempt under the following paragraph of part I of schedule 12A to the Local Government Act 1972: -

3 = Information relating to the financial or business affairs of any particular person (including the authority holding that information)

The reason that the information contained in the exempt appendix is private is because the Council has not yet moved to signed contract stage with both the land transaction nor the construction contract.

Public Interest Test

It is in the public interest that the exempt appendix be taken in private because it contains commercially sensitive information that would jeopardise the Council’s investment position if it were to be publically available.

Wards affected

All

Executive Summary

This report updates on the proposals for Maidstone Borough Council’s investment in the construction of an Innovation Centre at Kent Medical Campus (KMC) and seeks delegated authority to enter into the European Economic Development Fund (ERDF) funding agreement and gain approval for a revised Capital budget.

Purpose of Report

To provide a progress update on the Innovation Centre Project.

To gain approval for a revised Capital budget and to sign the ERDF Funding Agreement.

This report makes the following recommendations to this Committee:

1.    That a revised total scheme cost as set out in Exempt Appendix 1 for the development of the Innovation Centre is approved;

2.   That delegated authority is granted to the Director of Finance and Business Improvement to sign the Funding Agreement with the Ministry of Housing, Communities and Local Government (MHCLG); and

3.   That delegated authority is granted to the Director of Finance and Business Improvement to approve additional borrowing for Capital expenditure for the project budget.

Timetable

Meeting

Date

Corporate Leadership Team

3 September 2019

Policy and Resources Committee

18 September 2019

Innovation Centre project

Issue

Implications

Sign-off

Impact on Corporate Priorities

The relevant Strategic Plan objectives are:

·         Embracing Growth and Enabling Infrastructure

·         A Thriving Place

Accepting the recommendations will materially improve the Council’s ability to achieve the above objectives.  We set out the reasons other choices will be less effective in Section Three

Head of Regeneration and Economic Development

Cross Cutting Objectives

The four cross-cutting objectives are:

·         Heritage is Respected

·         Health Inequalities are Addressed and Reduced

·         Deprivation and Social Mobility is Improved

·         Biodiversity and Environmental Sustainability is respected

The Innovation Centre supports the achievement of the ‘Biodiversity and Environmental Sustainability is respected’ cross cutting objective with the inclusion of a green wall and solar panels.

Head of Regeneration and Economic Development

Risk Management

·         Already covered in the risk section.

Head of Regeneration and Economic Development

Financial

Accepting the recommendations will require revised funding from prudential borrowing. The additional expenditure is expected to ‘lever in’ additional external funding of up to 43p in the pound. Details of the total resources required are set out in the exempt appendix.

The project is still expected to deliver a return in excess of 5% with the Internal Rate of Return (IRR) now estimated at 5.2% (down marginally from indicative 5.8% reported in October 2018).

A further revenue stream will be realised from the additional Business Rates generated from the Innovation Centre and retained locally due to the Enterprise Zone status of the site.

Interim Head of Finance (Deputy Section 151 Officer)

Staffing

·         We will need access to extra expertise to deliver the recommendations and this is covered within the project.

Head of Regeneration and Economic Development

Legal

·         The Local Government Act 1972, section 111(1) empowers a local authority to do anything (whether or not involving the expenditure, borrowing or lending of money or the acquisition or disposal of any property or rights) which is calculated to facilitate, or is conducive or incidental to, the discharge of any of their functions.

·         S120(1)(2) of the 1972 Act enables the Council to acquire land to be used for the (b) the benefit, improvement or development of their area; or for the purpose of discharging the Council’s functions.

·         The procurement of services for the Innovation Centre should be in accordance with the Council’s Contract Procedure Rules and the public Contract Regulations 2015.

·         Acting on the recommendations is within the Council’s powers as set out in the above statutory provisions

Legal Team

Privacy and Data Protection

·         Accepting the recommendations will increase the volume and time of retention of data held by the Council.  All ERDF funded bids require documentation retention of 25 years. We will hold that data in line with our retention schedules.

Policy and Information Team

Equalities

·         An equalities impact assessment has been carried out on the project.

Policy & Information Manager

Public Health

·         We recognise that the recommendations will not negatively impact on population health or that of individuals.

Public Health Officer

Crime and Disorder

·         Not applicable

Head of Service or Manager

Procurement

·         On accepting the recommendations, the Council will then follow a procurement exercise for the Tenant Acquisition service.  We will complete those exercises in line with financial procedure rules.

Head of Service & Section 151 Officer