Issue - meetings

Councillor I.T.E. Harvey

To consider a report and business update on Knowle Green Estates Ltd.

Reason for exemption

This report contains exempt information within the meaning of Part 1 of Schedule 12A to the Local Government Act 1972, as amended by the Local Government (Access to Information) Act 1985 and by the Local Government (Access to information) (Variation) Order 2006 Paragraph 3 – Information relating to the financial or business affairs of any particular person (including the authority holding that information) and in all the circumstances of the case, the public interest in maintaining the exemption outweighs the public interest in disclosing the information because, disclosure to the public would prejudice the financial position of the authority in the property market by allowing other bidders to know the position of the Council.  This in turn prejudices the Council by (i) distorting the sales process and (ii) prejudicing the opportunity for the Council to acquire sites for the delivery of housing and the prudent management of its financial affairs.

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

Cabinet considered an exempt report giving details of progress made in the development of a business plan for Knowle Green Estates Ltd.

Resolved:

1.    To note progress towards the development of a Knowle Green Estates Ltd (KGE) business plan;

2.    To note the advice on State Aid which has been provided by Counsel (Confidential Appendix 1);

3.    Subject to receiving up to date valuation advice prior to transfer, to delegate authority to the Chief Executive in Consultation with the Leader, Portfolio Holder for Finance (or the Deputy Leader if he is not available) and Chief Finance Officer, to transfer the following Council properties into the ownership of Knowle Green Estates Ltd for nil cash consideration:

a.    Former Bugle PH

b.    Former Churchill Village Hall;

4.    Subject to receiving up to date valuation advice prior to transfer, to delegate authority to the Chief Finance Officer in Consultation with the Leader, Portfolio Holder for Finance (or the Deputy Leader if he is not available) and Chief Executive, to loan to Knowle Green Estates Ltd (if necessary) the funds to enable it to purchase at full market value:

a.    Former Bugle PH

b.    Former Churchill Village Hall

c.    42 Kingston Road

d.    Cranford Road;

5.    To note in relation to 42 Kingston Road (Cabinet minute 25 April 2018) that the Chief Finance Officer has determined the most financially advantageous funding arrangement for the purchase is for it to be held in Knowle Green Estates Ltd.;

6.    To note that any funding requirement will be provided under the Loan and Drawdown Agreement approved by Cabinet on 11 May 2017;

7.    Subject to receiving up to date valuation advice prior to transfer, to delegate authority to the Chief Executive in consultation with the Leader to:

a.    Move a Council property in the Municipal Portfolio to the Residential Portfolio by transferring it to KGE Ltd on such terms as he thinks fit

b.    Consent to receive a KGE Ltd property in the Residential Portfolio which is to be held by the Council in the Investment or Municipal Portfolio on such terms as he thinks fit; and

8.    To delegate to the Head of Corporate Governance to enter into all documentation required to give effect to these transfers and loans.

Reasons for decision

To document the relationship between the Council and Knowle Green Estates Ltd.  To allow the Council and the Company to move properties to the most advantageous holding organisation.  To provide a source of funds to the Company (if it is deemed advantageous by the Chief Finance Officer) so that the properties can be held as debt rather than equity.