Decision details

To seek approval of the report of the Cabinet Member for Housing on the Townhill Park Regeneration Framework Financial Model, Delivery Framework and funding for the implementation of Phase 1.  The Townhill Regeneration Framework report approved by Cabinet on 12th March 2012 focused on approval of the principles of the Regeneration Framework and implementation of Phase 1, subject to approval of an affordability assessment to be included in the 16th April Cabinet report.  The focus of this Cabinet report is consideration and approval of the impact on the Housing Revenue Account business plan, General Fund finances, the implications for the Delivery Framework and the funding of capital expenditure for the implementation of Phase 1. 

(i)  To agree that the HRA capital programme will fund the site preparation costs set out in this report, currently estimated at £10.7M, and:

·  To approve a virement of £10.7M from the uncommitted provision for Estate Regeneration which exists in the HRA capital programme and business plan to establish a specific budget for Townhill Park, the phasing for which is set out in appendix 2.

·  To approve, in accordance with Financial Procedure Rules, capital spending of £2.8M on phase 1 of the Townhill Park project, phased £0.3M in 2012/13, £1.6M in 2013/14 and £0.9M in 2014/15.

(ii)  To note that the General Fund capital programme will be required to fund highways infrastructure, open space improvements and replacement community facilities where appropriate, at an estimated cost of £2.8M with the method of funding this being agreed once the use of the Community Infrastructure Levy and the value of the GF capital receipts are known.

(iii)  To agree that the preferred approach for the provision of the new social housing is for this housing to be supplied by a Housing Association and that 50% of this new social housing provision will be provided for letting at target rents with a potential subsidy from the council, estimated at £3.9M, to be funded through a mixture of reduced land receipts (£2.6M) and utilisation of the uncommitted funding in the Housing GF capital programme (£1.3M), subject to legal advice on the potential financial implications for the HRA.

(iv)  To agree that the phase 1 regeneration of Townhill Park will be by way of a Development Agreement.

(v)  To agree to recommend to Council that:

·  £21M of the 30 year HRA revenue surplus is utilised to meet the long term revenue costs of the regeneration of Townhill Park which includes the requirement to repay the debt on the dwellings that have been disposed of from the general HRA revenue balance as there is no net capital receipt to fund this repayment.

·  The General Fund capital programme funds the highways infrastructure, open space improvements and replacement community facilities where appropriate, at an estimated cost of £2.8M with the method of funding this being agreed once the use of the Community Infrastructure Levy and the value of the GF capital receipts are known.

To approve the financial implications of the regeneration framework for Townhill Park so that the regeneration proposals can proceed.

1. The option of not approving the financial contributions to meet the cost of delivering the regeneration framework has been rejected as it would not enable the regeneration of Townhill Park to proceed.
2. The option of the HRA providing the new social housing has been rejected as it would increase the impact on the 30 year HRA revenue surplus.