Meeting documents

Cabinet
Tuesday, 6 June 2006

CA060606-12

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Division(s): Chipping Norton

ITEM CA12

CABINET MEETING 6 JUNE 2006

CHIPPING NORTON DEPOT

Report by Head of Property and Head of Finance & Procurement

Introduction

  1. The Capital Steering Group has considered a request from West Oxfordshire District Council that surplus Highways Depot land at Chipping Norton should be sold at less than the best consideration that can be achieved. The report gives details of the offers which have been received, the District Council’s advice (see Annex 1), the relevant County Council policies, and the recommendation of the Capital Steering Group.

    2. Highways Depot Land

  2. Part of the Highways Depot off Banbury Road, Chipping Norton, became surplus to requirements as a result of the Highways Depot strategy. Part of the site needs to be retained for continued operational use. The surplus land is allocated for development for employment uses in the Local Plan and planning consent has been granted for that use. It will be necessary for a new access to be constructed which will serve the surplus land and also the adjoining County Council owned land which was formerly part of Rockhill Farm but has also been identified for development in the Local Plan.

    3. Chipping Norton Town Partnership

  3. A Town Partnership has been formed by the County Council, West Oxfordshire District Council and Chipping Norton Town Council. This was formed following the announcement of the closure of Parker Knoll and a town appraisal which was undertaken in 2002. The aim of the Partnership is to maintain and develop Chipping Norton as a ‘working Cotswold town’.

  4. In 2004 the County Council received a capital receipt from the waiver of a covenant restricting use of part of the Parker Knoll site. The Capital Steering Group agreed that a part of the receipt should be reserved to assist with the generation of new employment in Chipping Norton in accordance with the aim of the Town Partnership. A small part of that has been used to pay the County Council’s share of a study jointly commissioned by the County and District Councils into the feasibility of establishing an Enterprise Centre.

  5. The report of that feasibility study indicates that there may be demand for an Enterprise Centre in Chipping Norton but the financial viability would be dependent upon relatively high rental and occupancy levels. District and County officers have agreed that further work will need to be undertaken on the business case before either authority could recommend that a project for an Enterprise Centre should be taken further.

  6. The District Council initially requested that the sale of the Highways Depot land be deferred until there had been a conclusion as to the viability of an Enterprise Centre as they considered that the Depot land would be the most suitable location, although that was not the view of the consultants commissioned to undertake the feasibility study. It was nevertheless decided that the marketing of the Depot land should proceed to establish whether disposal for employment uses might provide greater benefit to the local economy than reserving the land for possible future use for the Enterprise Centre.

    7. Bids for the Highways Depot Land

  7. There was considerable interest in the Highways Depot land. It was marketed with offers invited for the whole site or for two separate lots – to ensure that there was flexibility allowing local businesses to bid for a size of site which would suit their needs. In total there were nine bids, most of them for the whole site. Details of the highest bids are given in exempt Annex 2. Brief details of the bidders and their proposed uses are given below:

    • Network Estates Limited – a London-based company which has undertaken development in Oxfordshire mainly for industrial and commercial uses. Its proposal is to develop the site for occupation by a specific but unnamed company.

    • Stockdale Limited – a local company based at Deddington which has undertaken work throughout the county and is willing to provide units which would be available on a freehold or leasehold basis with possible opportunity for part-buy/part-rent to give the greatest flexibility to local businesses.

    • CETA Limited – a local employer wishing to relocate and expand. See below for fuller details.

Annex 2 contains information considered to be exempt within paragraph 3 of Schedule 12A to the Local Government Act 1972 ("information relating to the financial or business affairs of any particular person, including the authority holding that information"), namely, details of offers received for the acquisition of the property submitted on the basis of commercial confidentiality. It is considered that in all the circumstances of the case the public interest in maintaining the exemption outweighs the public interest in disclosing the information, which would be likely to be prejudicial to the Council’s position in negotiations in respect of the sale of this particular property, to the Council’s standing generally in relation to such transactions in future, and accordingly to the Council’s ability properly to discharge its fiduciary and other duties as a public authority. It is recommended on those grounds that the public be excluded from the meeting during any discussion of the Annex as it is likely that if they were present during that discussion there would be a disclosure of the exempt information.

West Oxfordshire District Council Recommendation

  1. The District Council has put forward a case for the sale of the land to CETA, even though they are not the highest bidders. A report from the Leader of the District Council and their Business Development Officer is attached (Annex 1). Should the County Council agree to that recommendation then there would need to be a good justification for disposing of the site at less than the best consideration.

    2. County Council Policies

  2. In October 2003 the Executive considered a report on the process of disposal of surplus land for less than full market value following the publication of the General Disposal Consent (England) 2003. This gave powers to local authorities to dispose of surplus property at less than the best consideration where it would help to secure the promotion or improvement of the economic, social or environmental wellbeing of its area. The Executive agreed that any proposals for the disposal of surplus property at less than full value under the terms of the 2003 General Consent should initially be considered by the Capital Steering Group with any recommendation then made to the Cabinet. A sale at less than the full value should be agreed only if it would contribute to one of the Council’s priorities and a case was made in effect justifying the foregone receipt in accordance with the normal processes for the allocation of capital resources.

  3. In the present case, protecting current employment and facilitating economic development in Chipping Norton would be consistent with the County Council’s involvement in the Town Partnership and would also be in accordance with the strategic priorities to:

    • Help the economy to grow as fast as possible with a real choice of access to jobs, homes, leisure and services and in a way that does not prejudice the future of our environment;

    • Give all of us – throughout our lives – the opportunity to enjoy effective teaching and learning (see Part 2.3 of the paper submitted by the District Council);

    • Safeguard our communities and maintain our rural character.

  1. On the other hand, it could be argued that disposing of the site for less than the best consideration would not be in accordance with the Council’s objectives of low taxes and value for money. Should the decision be taken to accept a bid which is less than the highest then there would be a good case for the foregone capital receipt being deducted from that part of the receipt from the waiver of the restrictive covenant on the Parker Knoll land which is being held for possible uses to assist generation of new employment in Chipping Norton.

    2. Financial Implications

  2. Should the recommendation from West Oxfordshire District Council be agreed, and the former Highways Depot land be sold to CETA Limited, then the price achieved would be lower than the best consideration that could be achieved following the marketing. The funds currently reserved from an earlier capital receipt, for use to assist with the generation of new employment in Chipping Norton, are referred to earlier in this report. If the foregone capital receipt were to be deducted from those funds then there would be no change to the capital financing available for the Council’s capital programme.

  3. It is considered that there would be local economic benefits arising from a sale to CETA Limited. There should be no quantifiable revenue implications for the County Council, though it should be noted that there may be a benefit to community safety from the practice of CETA of releasing staff for part-time fire-fighting.

    4. Conclusion

  4. There is a general presumption that surplus property should be disposed of for the best consideration possible. However, the County Council does have the power to dispose of land at an under-value where it is satisfied that by doing so it would help to secure the promotion or improvement of the economic, social or environmental wellbeing of its area. In this case, there is strong advice from the District Council that disposing of the former Highways Depot land to CETA Limited would protect existing jobs and enable the expansion of a locally based employer which has employment and training practices which benefit the local community.

  5. The sale of the land to Stockdale Limited could also benefit the local economy as they would seek to provide accommodation which would suit new or small local businesses and would be available on flexible leasehold or freehold terms giving a range of opportunities to local businesses. However, on the assumption that Stockdale would require the County Council to pay the cost of the access road, or that their offer would be amended should they take on that responsibility, their bid is less than the one from CETA.

  6. There is little information available on the proposed uses from Network Estates. Any new development for employment uses should provide additional jobs but the District Council’s advice is that the potential loss of CETA would outweigh any benefits for the local economy.

  7. In conclusion, the advice of the District Council should be taken seriously and they have put forward a reasonable case for a sale to CETA having the most benefit to the local economy.

    8. Recommendation from the Capital Steering Group

  8. The Capital Steering Group has considered the request from West Oxfordshire District Council and concluded that there would be significant local economic benefits from a sale of the surplus Highways Depot land to CETA Limited. The Group’s advice is incorporated in the recommendation below.

    9. RECOMMENDATION

  9. The Cabinet is RECOMMENDED:

    1. to authorise acceptance of the offer submitted by CETA Limited for the purchase of the former Highways Depot land at Chipping Norton under the provisions of the General Disposal Consent (England) 2003, on the basis outlined in the report;

    2. that the difference between the highest bid for the purchase of the land and the bid from CETA, be deducted from the funds currently reserved to assist with the generation of new employment in Chipping Norton.

NEIL MONAGHAN
Head of Property

SUE SCANE
Head of Finance & Procurement

Background Papers: Nil

Contract Officer: Neil Monaghan, Tel (01865) 815712

May 2006


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