north solihull partnership draft business plan (v2)...

Appendix A

NORTH SOLIHULL PARTNERSHIP

Draft Business Plan (v2) April 2015 - March 2020

Investing For a Lasting, Positive Future For The Communities of Chelmsley Wood, Smith’s Wood,

Kingshurst & Fordbridge, Solihull

Contents

1. Introduction 2 2. Executive Summary 2

3. Financial Position 6

4. NSP Governance Structure 8

5. Income from Land 9

6. Future Land Strategy 11

7. Individual Budgets 12

Land incl Property & Legal

Housing

Schools

Village Centres

Socio Economic

Communications, Consultation & Marketing

Interest & Debt Repayment

Overheads

8. Future Funding Strategy 25 9. Business Plan Development 26 10. Summary & Future Aspirations 28

11. The Future – Funding, Options, Integration with other Projects & Legacy 29

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1. Introduction The NSP budget holders and Finance Group have prepared this Business Plan document based on previously agreed assumptions and as previously directed by the Executive Programme Board and General Partner Board. This document sets out assumptions and detail around land disposals and regeneration outputs that underpin the prioritised activities of the Partnership up to 2019/20. It also highlights the role of the Finance Group in monitoring, controlling and mitigating the risks associated with these activities. 2. Executive Summary This Business Plan sets out the detailed breakdown and commentary on each of the areas of regeneration activity and identifies the sites that form the revenue stream for undertaking the programme of regeneration investment. The Business Plan also sets out NSP’s legacy and how the activities of NSP meet the wider objectives of SMBC for the North of the Borough. A chronology of key Executive decision making reports has also been included to chart the evolution of the Business Plan since the last major review in 2009. This Business Plan sets out to be realistic and prudent, whilst still maintaining the potential for the project activities and outputs to evolve and expand as opportunities arise. NSP’s ability to deliver this Business Plan will depend on the continued support and commitment of the NSP partners, wider stakeholders, local politicians and the communities of Chelmsley Wood, Smith’s Wood and Kingshurst & Fordbridge. Partners have in the past agreed to take a flexible view on the timing of repayment of loans and liabilities over the Business Plan period. Partners and stakeholders with long-term liabilities have confirmed their commitment to continue to supply letters of comfort in accordance with our auditor’s requirements, to enable yearly accounts to be signed off without provision for total repayment of liabilities within the Business Plan period. The consequence of this is that, to the extent that liabilities remain at the end of this Business Plan period and/or at completion of the project, that such liabilities that remain will be written down or written off as necessary. The key principles of this Business Plan are:

1. To continue to maintain regeneration outputs across all programmes, wherever possible. Partners remain committed to the original objectives of the NSP project as set out in the Strategic Framework. Whilst this Business Plan sets out reduced levels of activity it is important to note that regeneration activity continues. It is important that the NSP profile is maintained as this will be a route to future funding and enhanced values. Partners should note that this Business Plan sets out regeneration activity funded by land receipts that will be complete in 2019.

2. To seek to balance the potential to repay long-term liabilities alongside

regeneration investment. Optimising land values and therefore land receipts to the Partnership is central to fulfilling this objective.

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3. To prioritise the completion of work in current areas of activity. 4. To continue to promote sites for development and to link these with the

regeneration outputs that can result from the land receipts received. 5. To progress with infrastructure proposals that will bring forward future land

for the development of new homes. Infrastructure may be eligible for public sector and European funding. NSP and SMBC will continue to monitor opportunities for funding that could replace land income to fund this investment. NSP funds could then be redeployed to other priorities.

6. To increase the range of affordability, type, tenure and performance

specification of new homes. Our ability to achieve this is conditional upon land values being maintained at sufficiently high levels, after planning related costs, to enable this to take place. To actively participate in appropriate HCA and other funding streams that could meet this objective.

7. To maximise the potential for the regeneration area to benefit from strategic

investment being made in the West Midlands, notably within the UK Central area.

Key Outputs Based on the assumptions around land income and the timing of its availability for reinvestment into regeneration projects and programmes, NSP will deliver the following key outputs during the period 2015 to 2020:

Completion of Smith’s Wood Village Centre development including o Completion of Phase 2, health building

Completion of Chelmund’s Cross Village Centre including: o Phase 2, health development o Phases 3, 4 & 5 retail, commercial, residential & public realm to

be in progress Delivery of Kingshurst Village Centre including Mountford PH Completion of North Arran Way Total Neighbourhood projects Completion of Craig Croft Total Neighbourhood projects Completion of green space enhancements Completion of Coleshill Heath School & Fordbridge Schools including a

financial contribution of £2.5m from NSP (note: see specific reference to this

within the schools section, table 6, page 18) The development of 1900 new homes on identified sites The investment of £630k in socio economic programmes The investment of £6.7m in land and infrastructure from within the

Business Plan The potential repayment of Partner and stakeholder loans. The extent to

which this can take place is dependent upon the net land receipts and the relative priority determined by the GP Board between regeneration outputs and dealing with long term liabilities.

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Achievements If delivered the outputs above would build on the significant achievements already delivered in the area which include the following: Housing

1451 new homes with planning permission to date

1049 new homes built

508 private (127 Equity Share) and 541 RSL = 52% affordable

Demolition of 888 homes including 5 high rise blocks

Continuity of grant support for affordable housing and leverage of private investment

Village Centres

Construction of a new road forming a new High Street for Smith’s Wood Village Centre

Smith’s Wood Village Centre retail, offices and housing complete, assisted living scheme due to finish April 2015; medical centre negotiations underway

Chelmund’s Cross Village Centre Enterprise Centre, public realm, new infrastructure and changes to Chester Road complete, health centre started on site January 2015

Fourth primary school (Bishop Wilson) with integrated community facilities and a church building opened

Preferred developer selected for retail units Open Space

Around £2.5m invested in improving open space & play facilities Socio Economic & Jobs £1.496m invested and committed to social & economic projects 5.2% of the total land receipts has been committed to social and

economic projects over the next 4 years

In 2014/2015 the Employment and Skills team supported 319 Solihull residents into employment; 207 of these were young people age 16 – 24 and 69 of these secured an Apprenticeship. The Employment and Skills Team and the Business Investment Team together secured 365 vacancies with local businesses, of which 87 were apprenticeships

In 2014/15 the North Solihull Jobs Fund has supported 10 local businesses to fund 14 apprenticeships. It has also joined up with GBSLEP’s Destination Work scheme and signed 8 contracts to deliver an additional 14 jobs

In 2014/15 the North Solihull Business ‘Start-up’ Grants programme awarded 10 North Solihull enterprises grants totalling £19.5k and supported a wide variety of businesses and community enterprises ranging from a social enterprise training young people, accountants, recruitment, marketing and events consultancies through to a local food cooperative. It has also had a transformational impact on ‘Enterprise for Success’ business starts across North Solihull - 7 no. full time + 1 no. part time jobs safeguarded with 14 no. full time + 3 no. part time forecast to be created within 12 months of receiving grant

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Bellway Apprenticeships & Local Labour 12 Solihull residents have been offered apprenticeships with Bellway or their supply chain. 4 of the apprentices achieved level 2 NVQ and 4 achieved level 3. At the time of writing the project is about to recruit a further 2 apprentices.

o 77 (including the 12 apprentices) Solihull residents have been employed on Bellway developments in North Solihull since 2006

o 47% of total site labour has been recruited from the SMBC area defined as local

o 24% of total site labour has been recruited from the North Solihull priority area

o 14% from the wider Solihull borough o 16% from within a 10 mile radius of the Solihull borough boundary o 22% of total sub-contractors winning Bellway North Solihull

contracts are from the SMBC area defined as local

The overall gap in unemployment rates between North Solihull and the rest of Solihull has shown a small improvement

Education

Key stage 4 - the gap between North Solihull schools and the rest of Solihull schools for the average KS4 point score per resident pupil has decreased from 61% in 2004/5 to 22% in 2012/13

Key stage 2 - the gap between North Solihull schools and the rest of Solihull schools for the average KS2 point score per resident pupil has decreased from 12% in 2004/5 to 8% in 2012/13

4 new primary schools completed and open

Two further primary schools being built, due to open September 2015 Crime Figures

Total reported incidents of crime in regeneration wards down from 111 per 1,000 people in 2009/2010 to 83 per 1,000 people in 2014/15

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3. Financial Position Table 1 below provides a summary of the final Business Plan’s financial position:

TABLE 1

NSP BUSINESS PLAN BUDGET SUMMARY

2015/16 - 2019/20

2014/15 Approved

Budget

2014/15 Revised Forecast

2015/16 2016/17 2017/18 2018/19 2019/20 Total

15/16 to 19/20

£'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000

Gross Land Receipts 3,073 951 4,344 3,239 3,441 2,000 0 13,024

less: costs deducted from receipt (244) (244) 0

Net Land Receipts 2,829 707 4,344 3,239 3,441 2,000 0 13,024

LESS:

Land & Infrastructure costs (1,681) (330) (3,124) (2,070) (903) (500) (100) (6,697)

Property & Legal costs (108) (62) (70) (50) (20) (40) 0 (180)

Net surplus/ (deficit) on Land Receipts

1,040 315 1,150 1,119 2,518 1,460 (100) 6,147

Less: Other costs

Village Centres 0 (10) (10) 0 (800) 0 0 (810)

Socio Economic (150) (113) (180) (150) (150) (150) 0 (630)

Housing 0 0 0 0 0 0 0 0

Communications (35) (5) (25) (25) (26) (26) (27) (129)

Overheads (231) (224) (240) (238) (173) (154) (64) (869)

Interest (172) (160) (171) (182) (182) (182) 0 (717)

Other Income 0 25 0 0 0 0 0 0

sub-total Other Costs (588) (487) (626) (595) (1331) (512) (91) (3,155)

Total I&E Surplus / (Deficit) 452 (172) 524 524 1,187 948 (191) 2,992

Debt Repayment (500) 0 (500) (300) (400) (400) (601) (2,201)

Contribution to Schools programme

(30) (30) 0 (190) (190) (190) (189) (759)

Total Planned Surplus / (Deficit) (78) (202) 24 34 597 358 (981) 32

Overhead as % of Total Spend 9.7% 25.5% 6.3% 8.8% 7.7% 14.6% 33.5% 8.0%

Socio Economic as % of Land Receipts 5.3% 16.0% 4.1% 4.6% 5.7% 7.5% N/A 5.2%

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4. NSP Current Governance Structure

FUNCTION

OPERATIONAL

North Solihull Regeneration Partnership General Partners’ Board

North Solihull Regeneration Company

NSP Executive Programme Board

Finance Committee

Council

Cabinet

Portfolio Holder

Scrutiny Board

SMBC

Planning & Infrastructure

North Solihull Regeneration Partnership

Governance Structure

Programme Director Ian Cox

(PA/Secretary, Jo Watson)

Finance SMBC/WF

Regeneration Director

John Halton

Schools Programme Board

Socio Economic Workstream

Village Centres

Operational Land

Design & Cost Review

Community, Member & Public

Consultation

Legal & Property Services

Partnership Office

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5. Income from Land Housing development, its enablement costs and the land receipts generated from it, is the key income source for the Partnership throughout this Business Plan period. Land receipts resulting from new housing amount to 100% of the Partnership’s income while land costs (including property and legal), needed to bring housing development forward, represent 68% of the Partnership’s expenditure in the extended Business Plan period. This expected income is underpinned by the Land List programme which details future development sites and their anticipated disposal dates and in view of the reduced land receipt that are now projected this list has accelerated the timetable for delivery to ensure sufficient income is generated to support overall regeneration objectives. The source and timing of expected land receipts are detailed overleaf:

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TABLE 2

Please see Appendix B 6. Future Land Strategy The original NSP Business Plan set out a 15 year programme of development on sites which included:- 1. Local Plan Strategic Housing Sites Since the adoption of the Local Plan these former green belt sites have been designated for housing. One substantial Local Plan site at Conway Rd identified for development has been omitted from the Business Plan as this has now been earmarked for development as a Technical College for the WMG Academy for Engineers. 2. Surplus School Land Three remaining school sites have been identified as a result of the primary school capital programme, the existing sites of Coleshill Heath, Fordbridge and Bosworth Wood schools. The extent of development on these sites and amount of general needs affordable housing will be influenced by the objective to retain an existing Children’s Nursery and to provide an Extra care facility on site. 3. Brownfield Land The remaining sites are on previously developed sites that are no longer suitable for their historic use namely industrial or retail developments. The potential for the inclusion of further intervention sites is being kept under review. Therefore, we will review potential intervention sites and evaluate the likely acquisition and site assembly costs, infrastructure requirements, new residential mix, tenure and density options to try to create larger development parcels that have the potential to create a sense of place with value enhancement. The inclusion of redundant, underused or poorly located open spaces also offers decant potential. We need to look at under-occupation levels, demand for supported housing that could free up sites for development and a financial model to highlight the criteria to evaluate buy in cost v replacement value, street replacement, housing using existing street pattern, percentage of affordable housing, external funding sources, land swaps e.g: playing field relocation to Simon Digby site that need to be met in order create viable development sites. 4. Commercial Development Opportunities to introduce further commercial, retail or leisure facilities into the area will be pursued. At the Chester Road/Moorend Avenue junction the opportunity to release development land for such uses exists through the realignment of the Chester Road roundabout, this site would be suitable for such development and could link with the housing sites identified at Simon Digby and the Centurion Public House.

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Any facilities introduced into the area must be complimentary to the town and village centres offering additional amenities and not compete with existing ones. At Chelmsley Wood Town Centre redevelopment opportunities are potentially available and these may feature mixed use or solely housing developments to compliment existing facilities and to create a more vibrant and active centre. Land Risks Identified in Risk Register Other key risks to the forecast land receipts, in addition to those identified above, are site constraints, design and sustainability aspirations, housing market demand for the range of tenures proposed, planning gain impositions and the provision of compensatory green space enhancements along with infrastructure costs. However the conclusion of several strategies such as sustainability, green space and the Cole Valley Master plan better identify specific requirements and likely infrastructure costs for the development sites. Additionally there are processes in place governing the production of design briefs and design and appraisal review; project managing the release of land (the Land Tracker programme); and forums for resolving development issues (Planning & Infrastructure work stream) to sufficiently manage these risks. The current Business Plan has accelerated the delivery of housing developments with a greater number of sites being delivered each year. This has reduced the overall delivery period for identified sites to ensure the proportion of expenditure on overhead costs is proportional to the land receipts. Delivering these additional sites within this period is considered realistic but clearly this creates a potential risk to project an income if this cannot be achieved. 7. Individual Budgets General This section of the Business Plan sets out the constituent parts of each budget. The budgeting process, control and governance arrangements, and the basis for any prioritisation within individual budgets and between budgets if financial constraints dictate a scaling back of activity is delegated to the members of the Finance Group within the overall Business Plan assumptions. The finance group also monitors cash commitments against predicated income, monthly payment schedule approval and NSP Company financial management and reporting. The Finance Group has responsibility for setting, administering, monitoring and controlling all budgets contained within the overall Business Plan, year by year. Each Partner is represented on the Finance Group. Decision making is generally by consensus but the Group will escalate issues to the Executive Programme Board, where appropriate, if decisions need to be made at Partner Director level. The Board has reiterated that NSP should endeavour to maintain outputs across all programmes. This is seen as important in continuing to deliver the original objectives but also to maximise the potential for the project to remain a regional investment priority for public funding.

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Accordingly, total expenditure on the individual workstream programmes is allocated as follows:

TABLE 3

Land (inc Property & Legal)

The Land & Infrastructure budget identifies the expenditure needed to progress development sites on the Land List through the design, planning and disposal processes and to secure their delivery. It is assumed the majority of site infrastructure costs including site access will be met by the developer, with the Partnership mainly delivering only strategic green space enhancements. We will also continue to seek and apply for, third party funding that may assist in contributing towards the cost of this infrastructure The total expenditure on land related costs is forecast to be approximately £6.7m. The type and mix of developments have been designed to address a broad range of housing needs providing specialist and general needs accommodation. This is to ensure that we can cater for people with varying degrees of health and wellbeing. It is also recognised that the importance of green space is key to maintaining a healthy lifestyle for residents. Opportunities to enhance the quality of green space will continue to be sought to encourage residents to remain active to address the objectives of the Health & Wellbeing Board where appropriate.

Land & Infrastructure

62%

Communications 1%

Socio Economic 6%

Village Centres 7%

Overheads 8%

Property & Legal 2%

Schools 7%

Interest 7%

Split of Business Plan Expenditure Budget 2015/16 to 2019/20

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TABLE 4

NSP BUSINESS PLAN BUDGET 2015/16-2019/20

LAND COSTS

ANALYSIS BY TYPE 2014/15

Approved Budget


2015/16 2016/17 2017/18 2018/19 2019/20 Total

15/16 to 19/20

£'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000

Costs In Order to Achieve Land Receipt

137 2 1,371 974 50 2,395

NAW13 Disturbance Payments 750 27 520 150 0 670

Post Receipt Planning Commitments

320 242 332 473 243 1,048

Spend Towards Future Sites 35 0 100 0 0 100

Regeneration Deliverables: Committed

200 59 0 0 0 0

Regeneration Deliverables: Uncommitted (Total Neighbourood etc.)

239 0 801 473 110 100 1,484

Sites to be identified 500 500 1,000

TOTAL 1,681 330 3,124 2,070 903 500 100 6,697

ANALYSIS BY SITE 2014/15

Approved Budget

2014/15Revised Forecast

2015/16 2016/17 2017/18 2018/19 2019/20 Total

15/16 to 19/20

£'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000

Alcott Grove Phase 1 30 0 30 39 30 99

LP Housing Site 7 (Birmingham Road)

20 2 0 0 0 0

LP Housing Site 4a Phase 2 (Bishop Wilson & St Andrews)

223 235 37 27 27 91

CC10 Keepers Lodge 9 2 0 0 0 0

Local Plan Housing 6 (Centurion PH)

0 0 0 485 36 521

NAW13 830 27 970 150 0 1,120

Primary School 5 Phase 1 (Coleshill Heath)

16 0 489 2 0 491

Primary School 6 (Fordbridge Site)

16 0 500 2 0 502

Local Plan Housing 3 (Simon Digby)

30 0 122 830 170 1,122

Woodlands Highway 33 5 61 2 0 63

LP Housing Site 1 (Cooks Lane) 0 0 14 60 30 104

Sites to be identified 500 500 0 1,000

Masterplanning 35 0 100 0 0 100

Dove Way Park 30 31 0 0 0 0

NAW Total Neighbourhood 203 0 355 238 0 593

Craig Croft Total Neighbourhood 170 20 310 120 0 430

Other land costs 36 8 36 15 10 61

Contingency professional fees 100 100 100 100 400

TOTAL 1,681 330 3,124 2,070 903 500 100 6,697

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NSP BUSINESS PLAN BUDGET

PROPERTY & LEGAL COSTS

2015/16 - 2019/20

2014/15 Approved

Budget


2015/16 2016/17 2017/18 2018/19 2019/20 Total

15/16 to 19/20

Number of Sites Identified

10

4

7

4

2

4

Unidentified

Costs per Site: £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000

CBRE & Wragges 6.0 7.5 6.0 6.0 6.0 6.0 6.0

SMBC 3.0 3.0 3.0 3.0 3.0 3.0 3.0

add: Contingency for non standard work

1.8 5.0 1.0 1.0 1.0 1.0 1.0

Total cost per site 10.8 15.5 10.0 10.0 10.0 10.0 10.0

Total Cost 108 62 70 40 20 40 0 170

Whilst a breakdown of land expenditure is detailed above it is likely that this will have to be amended on a site by site basis as actual costs become known. The recent imposition of additional planning related costs is reducing the net land receipts and this will have to be factored in to ensure that funding commitments are only given once actual land income is known. Housing Budget The housing budget has historically funded the acquisition, retention and demolition of land and property pending demolition or redevelopment. As intervention sites are currently in the Business Plan no expenditure is currently forecast in this area.

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TABLE 5


HOUSING

2015/16 - 2019/20

2014/15 Approved

Budget


2015/16 2016/17 2017/18 2018/19 2019/20 Total

15/16 to 19/20

£'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000

CC10 Demolition costs 30 0

Grant Income (RHB) (30) 0

Non Grant-funded costs: Void works

0 0

0 0 0 0 0 0 0 0

NSP Housing Strategy Implementation The estimated total number of new (net additional) homes is based on the Local Plan assumptions for strategic housing sites together with windfall opportunities on the various types of land identified in the Land section. The Local Plan assumes an average density of 45 dwellings per hectare and is based on evaluation of achievements to date and design examples. However, NSP has strived to achieve the largest practical net increase in the number of homes to meet market demand and affordable housing need. We continue to keep under review the potential for redevelopment within existing neighbourhoods. This raises issues around meeting local people’s aspirations and having a viable long term Business Plan for the SCH managed properties. This may rely upon a ‘new for old’ rehousing offer in denser, more efficiently developed neighbourhoods. Increased energy costs for home owners may ultimately assist in encouraging people to look at more energy efficient alternatives to their current home, over the medium term. Many of the house types that are prevalent in North Solihull could be replicated in more pleasant and more efficiently master planned neighbourhoods. Large scale development may be the only solution to making this work by creating a step change in housing values, for existing home owners who participate. Recent developments have broadened the provision of specialist housing accommodation with elderly, special needs and homeless person accommodation being constructed to meet the needs of a diverse range of residents. Extra care provision is currently being explored at Coleshill heath school and Elderly person accommodation suitable for Dementia sufferers is being encouraged for the housing site within Chelmund’s Cross village centre. Affordable housing options have been predominately for affordable rent with options for Shared ownership being unaffordable due to house values and salary levels. However, intermediate housing options have been widely available across

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the regeneration area through equity share products including the current Help to Buy enabling purchaser to acquire properties at 80% of the open market value. The high rise strategy has changed since the original NSP Business Plan and the Strategic Framework were produced with significant investment being committed to high rise blocks. The potential for high rise tenure diversification and low level infill development around the base of towers has been investigated and a number of blocks have adopted age restrictions to provide greater tenure stability, development at the base of tower block is limited, and the introduction of biomass heating boilers to these has limited the availability of sites for small pocket developments in these locations.

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Schools – The North Solihull Primary Schools Programme Following the Council’s approval of the North Solihull Primary Programme Strategic Plan in summer 2012, the Council received an update at its Cabinet meeting in February 2015. This update reaffirmed the Council’s commitment to the delivery of £38.350m of works to construct six new schools and refurbish four. Four of these new schools have now been constructed and are fully operational, and the final two schools are under construction, due for occupation in September 2015. Design Briefs have also been prepared for the remodelling of the four schools (Phase 4), an exciting opportunity for the key stakeholders and in line with the processes that have gone before, outlined in the Strategic Plan and endorsed by Unity, the northern collaborative of schools. Consequently, as a result of all of this activity the schools programme remains significant to the future land release plans, and the resultant regeneration opportunities associated with the development of the land on which they are currently located. At an operational level the schemes, as demonstrated by the schools to date, for Fordbridge and Coleshill Heath, have created investment, jobs and training ‘in and for’ the local community.

The Strategic Plan also, in its eight themes, supports a broad range of Partnership and Corporate priorities including the future integration of children’s services and most importantly, by the creation of high quality teaching environments, the improvement of education standards and the commensurate impact that should have upon local children and families.

TABLE 6

NSP BUSINESS PLAN BUDGET SCHOOLS

2015/16 - 2019/20

2014/15 Approved

Budget


2015/16 2016/17 2017/18 2018/19 2019/20 Total

15/16 to 19/20

£'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000

Contribution From NSP to Schools Programme

190 190 190 189 759

SIP Fees re: Primary Schools 5 & 6

Fordbridge & Coleshill Heath - NSP

48 48 0

Fordbridge & Coleshill Heath (Grant Reclaimed)

(18) (18) 0

30 30 0 190 190 190 189 759

Notes Schools contribution of £2.500m in total: £1.741m to be included within 'Loan Repayments', leaving £0.759m

to be paid from I&E (this has not yet been agreed by NSLP)

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Village Centres The purpose of Village Centres is as a focus of integrated services for the benefit of local residents. They aim to provide a wide range of services including health, education and training, leisure, employment along with retailing opportunities and the intention is for them to be supported by residential development. In this way activity in the centres will continue throughout the day and into the evening, so providing safe, self supporting and vibrant focus to local communities. The key outputs in Village Centres within the Business Plan period include:

Delivery of the health facility, retail development and housing provision at Chelmund’s Cross

Completion of North Arran Way Village Centre following construction of the health facility

Remodelling of Kingshurst Village Centre and reprovision of community and health facilities

Chelmund’s Cross and North Arran Way Village centres are being led by SMBC on behalf of the Partnership, with the objective of being self funded developments. At Chelmund’s Cross a deficit has been identified for the retail development that will require a subsidy to be invested in this phase of the works. Bosworth School site has not previously featured in the Business Plan as the timing for delivery of this site was uncertain. As the site cannot come forward until we have vacant possession of some of the Council accommodation on site the only way to achieve this is to relocate staff to Chelmund’s Cross. As a consequence the Partnership has agreed to ring fence the land receipt from Bosworth School to be reinvested directly into Chelmund’s Cross Village Centre to ensure vacant possession is achieved. Proposals for Kingshurst Village centre are at feasibility stage and the most appropriate delivery model for this is currently being considered by Partners. Public liability insurance for the unadopted highway at Smith’s Wood is the only expenditure projected for Village Centres as a direct Business Plan cost.

TABLE 7


VILLAGE CENTRES

2015/16 - 2019/20

2014/15 Approved

Budget


2015/16 2016/17 2017/18 2018/19 2019/20 Total

15/16 to 19/20

£'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000

Non Grant-funded costs: Insurance

10 10 10

Chelmund’s Cross VC (funded by Bosworth Wood School)

800 800

0 10 10 0 800 0 0 810

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Socio Economic

The Socio Economic Work stream (SEWS) facilitates the implementation of the Partnership’s social and economic programme. The work stream brings together key stakeholders to identify specific local needs and to commission projects and activities that impact on the economic and social regeneration of North Solihull and to the delivery of the Regeneration programme.

The funding allocated through the work stream is focused on helping to improve the economic employment prospects of people living in North Solihull.

A proportion of land receipt income allocated towards a programme of projects aimed at assisting economic and social well-being targeted at closing the gap of inequality £630k.

TABLE 8


SOCIO ECONOMIC

2015/16 - 2019/20

2014/15 Approved

Budget


2015/16 2016/17 2017/18 2018/19 2019/20 Total

15/16 to 19/20

£'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000

Budget to be allocated to new projects:

150 150 150 150 600

Carry forward from 2014/15

150 120 30 30

0

0

0

0

0

0

150 120 180 150 150 150 0 630

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Communications, Consultation & Marketing Communications to be delivered in line with a revised communications & marketing strategy as per the Communications Review.

Regen hotline to be maintained and calls to be managed by Connect

Pre-application consultation for new development to be undertaken by the developer and co-ordinated by the Partnership.

Effective exchange of information to enable deliver of project objectives

Maintain profile of North Solihull Regeneration project

Effective engagement with the community and local councillors on plans for their area

TABLE 9


COMMUNICATIONS

2015/16 - 2019/20

2014/15 Approved

Budget


2015/16 2016/17 2017/18 2018/19 2019/20 Total

15/16 to 19/20

£'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000

Printing & Stationery 3 1 3 3 3 3 3 15

Distribution 4 1 4 4 4 4 4 20

Marketing 26 2 16 16 17 17 18 84

Web site 2 1 2 2 2 2 2 10

35 5 25 25 26 26 27 129

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Interest on Loans

TABLE 10

Please see Appendix B

Liabilities TABLE 11


DEBT REPAYMENT

2015/16 - 2019/20

2014/15 Approved

Budget


2015/16 2016/17 2017/18 2018/19 2019/20 Total

15/16 to 19/20

£'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000

Planned Debt Repayment (500) 0 (500) (300) (400) (400) (601) (2,201)

(500) 0 (500) (300) (400) (400) (601) (2,201)

Overhead/Resources This Business Plan has had to reflect the short term shortage and reduced total land receipts that are the principle income to NSP. This has resulted in a number of proposed changes to the way NSP is resourced and will operate over the remaining period of operation. We have reviewed the resources necessary to manage, co-ordinate and control the activities shown in this Business Plan. We have also had to set a limit on the project overhead that maintains the breadth of skills available and necessary but reduces this to a core team only. Partners have accepted that they will need to increase their own input where necessary to ensure that all tasks are carried out and completed as required by the Business Plan. As the land supply diminishes an appropriate reduction in overhead cost will be needed to reflect this, a number of operational solutions may be available to achieve this within the available budget. The actual resource allocations have not been decided but the operating cost in which this needs to be achieved beyond 2017 is as detailed overleaf.

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TABLE 12


OVERHEAD

2015/16 - 2019/20

2014/15 Approved

Budget


2015/16 2016/17 2017/18 2018/19 2019/20 Total

15/16 to 19/20

£'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000

Staffing

Ian Cox (Cox Developments) 24 24 24 24 12 12 0 72

Maria Curran (Sigma Inpartnership)

14 42 0 0 0 0 0 0

Management Services SLA (JH) (Whitefriars)

78 78 78 78 39 39 0 234

Project Support (SMBC) 0 23 23 24 25 12 107

sub-total: Staffing 116 144 125 125 75 76 12 413

Bought In Services:

Accounting Services SMBC 25 25 25 25 20 15 8 93

Accounting Services Whitefriars 25 25 25 25 20 15 4 89

Inspections & litter picking of sites (SCH Area Caretaker recharges)

8 0 8 8 6 4 0 25

Accommodation 0 (3) 0 0 0 0 0 0

Meetings/ Room Hire, Telephones, IT Support, Postage, Printing, Photocopiers, Travel Expenses

13 1 13 11 9 7 0 40

Insurance 16 8 16 16 16 12 8 67

Audit Fee Audit £15k, Tax Returns £5k, XBRL tagging £500

21 22 21 21 21 21 22 106

Legal Advice 8 7 8 8 6 4 10 36

Interest received 0 (5) 0 0 0 0 0 0

231 224 240 238 173 154 64 869

Overhead as % of turnover 8.17% 31.68%

5.53% 7.35% 5.03% 7.70% N/A 6.68%

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8. Future Funding Strategy The overall objective is to continue to identify opportunities to enhance the value of the developments we carry out in order to drive up values and increase the land value available for reinvestment.

To continue to identify public and private sources of funding.

To identify role of NSP in delivering the wider SMBC objectives, and how this can be used as a route to secure funding and investment where available.

To develop the relationship of this project with other wider strategic

investment and major projects.

Review the future structure and role of NSP as the Business Plan period progresses and the levels of risk and certainty become clearer.

Continue to review partners’ SLAs within the current obligations and

entitlements.

Seek to balance the Business Plan to enable repayment of Partnership SLA liabilities, loans and liabilities.

Set Partnership overhead at a resource level necessary to achieve viable

business plan but still capable of delivering the above outputs.

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9. Business Plan Development

Chronology of Key Decision making report NSP GP Board 6 Year Business Plan – report dated 20/06/2009 This Business Plan sets the scene for some of the revised assumptions and decisions that are still relevant to the finalisation of the current Business Plan:-

a) External income and grants b) The risk that abnormal costs may reduce land receipts c) Planning and site delivery risk d) Schools delivery programme e) Service Level Agreement reductions f) Deferral of loan repayment to Partners including HCA

NSP Executive Board Business Plan Update – report dated 09/09/2013 Implications for remaining Business Pan period and scenario planning up to 2020 Scoping Document for NSP GP Board – report dated 23/09/2013 The Partners need to discuss and agree the extent to which the regeneration process will be finished when current identified activities have been completed.

a) Relationship between the regeneration of the North of the Borough and adjacent major investment projects

b) Future regeneration priorities c) Funding & future land supply (type & location) d) The longer term strategy beyond the current Business Plan e) The optimum structure to deliver and complete the regeneration project f) The regeneration legacy and its management g) Jobs for local people

NSP GP Board, Long-term Strategy - report dated 23/09/2013 What happens beyond the current Business Plan period?

a) Regeneration is a long term process and it takes time for the outputs to begin to show the benefit of the investment being made. It is important that the regeneration focus continues in the long term to ensure that the benefits are durable and sustained in the long term

b) How can further land and other funding be sourced to continue and expand the regeneration investment?

c) How will NSP link into UK Central and other investments happening around the regeneration area?

d) How will NSP deal with its long term liabilities? NSP Executive Board - Land, Liabilities and Long-term Strategy – report dated 14/10/2013

a) Review of current process for progressing current land b) Review of original 28 sites identified in 2007 and implications for future land

supply beyond 2017 NSP Executive Board - Land, Liabilities and Long-term Strategy – report dated 11/11/2013

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The discussion that took place at the September GP Board and October Executive Board has initiated three pieces of work:

a) Review of land supply b) Review Business Plan priorities, SLAs, Governance structure and resource c) Public and private sector funding sources

NSP Executive Board, Business Plan – report dated 10/03/2014 Land value assumptions and apportionment of overhead NSP Executive Board, Interim Business Plan – report dated 04/08/2014 Emerging projected land receipts NSP Executive Board, Strategic Business Plan – report dated 09/10/2014 Review of regeneration principles previously identified in the Shared Intelligence Presentation NSP GP Board Business Plan – report dated 11/12/2014 Finance Groups recommendations on current Business Plan forecasts based on reduced land receipts NSP Executive Board – Strategic Long-term Opportunities - reported dated 05/01/2015 NSP Executive Board, Stocktake, Development Opportunities & Future Funding Strategy – 09/02/2015

a) Chapter 1, Stocktake b) Chapter 2, Development Opportunities Discussion Document

i. Chester Road Corridor ii. Smith’s Wood Legacy

c) Chapter 3, NSP New Proposition

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10. Summary & Future Aspirations Nature of NSP

SMBC Commission (2004) – Strategic Partnership to deliver physical, social and economic outcomes and improvements and based on community engagement, sustainability, financial robustness

4 legal partners and others

Key themes – housing, transport & movement, open space, employment, education & training, community hubs/VC (community facilities, shops, services, healthcare), sport leisure & culture, community safety

Need for Growth

Restructuring the housing market and strengthening existing communities in the area through improvements to schools, community facilities, retail leisure and employment services

North Solihull community – younger people, single people and higher proportion of lone parent households

Dominant tenure form – social rent 51%

The original aspiration was for end tenure mix: social 40%, intermediate 4%, private 56%.

NSP Funding & Importance of Land Supply

Council owned land comes to NSP at EUV

Planning permission secured – uplift in value – land receipt to NSP

Uplift value generated reinvested in funding regeneration programme activity

Land

Surplus School land – programme of school mergers, rebuilding and remodelling

Green space – large percentage of open space (left over space, radburn layout, grassed areas) generally has no identified function and in some instances detracts from quality of residential environment – rationalising these to enable development will help deliver programme of investment to improve quality of place of key spaces, perception of green space and how it’s used and safeguard important sites

Local Plan strategic housing sites – sites don’t exhibit the characteristics of wholly open, undeveloped greenfield land but instead have urban influences surrounding them. ‘Rounding off’ of built form that generates significant land receipts to help deliver the comprehensive regeneration programme

Intervention Current challenges

Potential to create viable intervention sites needs to be further explored

Cost of assembling sites – purchase price and secured debt; ability to secure new mortgages; demand for affordable housing could prolong rehousing of tenants; risk of planning blight if intervention identified too early; breaking up existing communities

Long term availability of land

Associated development costs to achieve planning approval

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11. Legacy of the Project

A commitment can be made on the income and output levels over the Business Plan period once there is absolute certainty on the land being received. The NSP Board have confirmed that these should continue to be comprehensive across all priority areas, albeit at lower output levels. The Business Plan retains the aspiration to begin to re-pay Partnership loans. The partnership income, land receipt levels and timescales have been refined as far as possible with affordable housing grant levels being maintained at current levels. Exploratory work is being carried out on new forms of funding, alternative types of housing and tenure and neighbourhood improvement works/legacy and integration of service delivery. Partnership overhead SLA costs and resource levels continue to be reviewed on the basis of the project activities during the business plan period. The objective is to reduce cost and revise the governance structure to respond to the NSP level of activities whilst retaining the facility to re-scale the resources as funding/activities increase in the future. NSP has made a significant contribution to the investment commitment set out by SMBC at the outset of the project. The scheme has survived the World economic collapse, housing market failure and Government spending constraints. This Business Plan sets out the way that the project will progress over coming years and sets the scene for future activity, in partnership with SMBC, SCH, HCA, the community and its representatives, and other stakeholders. This Business Plan period will see the completion of the identified regeneration investment. We are already seeing the outcomes we set out to achieve in terms of school performance, employment opportunities, reduced levels of crime and anti-social behaviour. We need to ensure that these benefits, along with other improvements to local peoples’ lives in terms of open space, public transport, additional housing to meet local need and market demand, and lasting positive change are embedded into the priorities for the project, as the Business Plan is delivered. The overall legacy for the North Solihull Partnership has not changed. The scale and scope of the project have slowed and reduced over recent years and within this Business Plan period. The commitment of the Partners to complete the project remains strong and the potential still exists for the project outputs to increase as values recover over the medium term. Ultimately the total investment being made will ensure that the three communities of Chelmsley Wood, Smith’s Wood and Kingshurst & Fordbridge are places that are popular, safe, healthy, vibrant and active. There is more to be done but this Business Plan continues the delivery of positive outputs and sets the scene for long term sustainability and stability for the regeneration area. The wider benefits of investment along the M42 corridor have yet to impact on the project. The long term prospects for the regeneration area will increasingly improve as this investment takes place. Future Business Plans will respond to this in order to ensure that the regeneration effect is maximised.

north solihull partnership draft business plan (v2)...

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