Issue - meetings

To consider the report of the Chief Executive.

Agreed:

RECOMMENDED that Council:-

(1)  note the findings of the Local Partnership LLP report presented at the meeting;

(2)  note ECL’s achievements to date;

(3)  that, notwithstanding the recommendation from Local Partnerships to wind down the operations of ECL, officers recommend that the company be retained for the limited purpose of holding and managing property;

(4)  grant delegated authority to the Chief Executive, in consultation with the Leader of the Council to facilitate recommendation no. 3 above to reduce ECL’s activities as follows:

a)    the Council enters into a business sale agreement with ECL, whereby the Council acquires all of ECL’s assets (with the exception of the six leasehold flats in the Guildhall Shopping Centre), including any work in progress in return for proper consideration, in the form of a release of ECL from its obligations under the Loan Agreements. The sale agreement shall include a novation of all contracts save those that may be terminated by ECL with the Council’s agreement;

b)    in the likely event that the value of the assets to be acquired from ECL is not sufficient to repay the loan to the Council, then delegated authority be granted to the Chief Executive, in consultation with the Leader and Section 151 officer, to write off any shortfall; and

c)    thereafter, ECL, in a much reduced capacity shall continue for the purpose of holding and managing property and, in particular, the 6 Guildhall flats.

(5)  agree that any staff implications are dealt with in accordance with its Organisational Change Policy;

(6)  extend the ECL appointments of the Interim Managing Director and the two non-Executive Directors until such time as they are no longer required to assist with the reduction of the company’s activities, with the termination of those appointments delegated to the Chief Executive;

(7)  grant delegated authority to the Service Lead - Legal Services to amend the Management Agreement to reflect the changes to the remit of ECL;

(8)  agree that SMB reflect on the Local Partnerships report as well as work being undertaken by the District Councils Network on commercial companies owned by local authorities to produce a report in due course setting out principles for how the Council will enter into any commercial ventures in the future;

(9)  agree that the Chief Executive be tasked to liaise with One Public Estate to negotiate an amendment to the grant conditions with the aim of retaining the Brownfield Land Release Funding (BLRF) funding where possible; and

(10)      agree to receive a report, if necessary, setting out a site disposal strategy in the likely event of a shortfall on the ECL loan after the Council acquires ECL’s assets.

Reason for Decision: As set out in the report.

The Executive received report which provided a review of the current position of Exeter City Living (ECL), a wholly-owned council housing delivery vehicle which was setup in June 2018. A review was commissioned by the Council following the failure to secure a contract for the redevelopment of the Clifton Hill site and the continued uncertainty around development given the difficult current economic climate. The findings of the review were outlined in Appendix A of the report and as presented at the meeting.

Councillor Vizard, having given notice under Standing Order No. 44, spoke on this item. He acknowledged that the Leader understood the history of the Clifton Hill site and the firm local opposition to development of the green space currently occupied by the Council’s tenants, including the ski slope and golf driving range. He highlighted that under the Leaders’ direction that a good, balanced decision had been made to develop only the broad footprint of the old leisure centre and retaining the rest of the site as public space. He sought reassurance, that in light of the report on Exeter City Living, that the Council had no intention of reconsidering the sale and development of the whole Clifton Hill site, and that a future sale and development would be limited strictly to the land area that was sold to ECL and received planning consent.

The Leader in responding, advised that the land that had been sold to Exeter City Living did not include the Green space behind the former Leisure centre site, nor the Golf driving range or the ski slope and valuations on the site to be acquired by the Council, would be identified. The Council’s aspiration was clear, in that it required housing for people, to include the required social housing requirement to be built on the land where there was already planning permission and that the Council would endeavour to bring forward appropriate proposals as soon as it could.

Councillor Vizard in asking a supplementary question, enquired whether the Leader had concerns on the viability of the sale of the site in its current state?

The Leader advised that he had concerns relating to the impact of the Covid Pandemic on development. There had been many consultations for Clifton Hill and a lot of work had been undertaken to move the proposals forward, to provide suitable housing. Although he had concerns on developing suitable housing in Exeter, the Council would continue to work hard to bring forward plans for the delivery of housing.

The Chief Executive presented the report which outlined issues relating to the financial position of ECL its continued ability to repay its loans to the Council and recommendations to minimise the financial risk to the Council, which had been supported by an independent review by Local Partnerships. Members were provided with a background overview of Exeter City Living, with particular reference made to:-

·         ECL was a wholly owned company of Exeter City Council, established in 2018, in which, the Council was the only  ...  view the full minutes text for item 93