SUMMARY/PURPOSE
1.
This
paper recommends further financial assistance to Lake Parish Council in support
of their purchase of Fairway Park, Sandown.
BACKGROUND
2.
Fairway
Park was formerly the premises of Sandown Football Club. The Club ceased to use the premises in 1995
and the land, having been unused for any purpose ever since, is now overgrown.
3.
Numerous
proposals have been put forward to develop the site and four planning appeals
have failed to secure development consent with proposals ranging from
residential development to a woodland cemetery, a tennis club and a dry ski
slope.
4.
The
refusal of development on the site has been due to the loss of open space, loss
of formal playing fields and inadequate alternative provision in the area. Sport England has supported the Council in
opposing development on the site.
5.
The
land is designated as open space in the Unitary Development Plan.
6.
Following
a resolution on 15 February 2001 the Council bid, but failed to acquire,
the land at auction.
7.
More
recently on 30 July 2002 the Executive resolved to :
“That if requested to do so by the Parish Council, the Isle of Wight Council agrees to underwrite the legal costs for the Compulsory Purchase Order procedure, including seeking Counsel’s opinion at an early stage”.
8.
The
cost of a CPO was expected to be in the region of £20,000. No budgetary provision was identified for
those costs as it was anticipated that they would fall within the financial
year 2003-2004 rather than in the current financial year.
9.
Counsel’s
opinion was requested and sought. The
opinion was generally positive about the prospects of a CPO being successful,
although it is clear that substantial work will be required and substantial
costs would be incurred if this option were pursued.
10.
Since
the request for Counsel’s advice was received, the owner of the property has
reopened negotiations and is willing to sell the land to Lake Parish Council
for a price of £49,500. This offer is
in excess of the independent valuation of the land but is less than the total
cost likely to be incurred by CPO related costs and compensation.
11.
It
is believed that the Parish Council have substantial funds available to commit
to the cost of purchase but equally face a substantial shortfall which they are
seeking to borrow. The servicing of any
loan will be an ongoing commitment to the Parish Council and, in circumstances
where the seller has indicated time is of the essence, the processing of the
loan will take some substantial time.
STRATEGIC CONTEXT
12.
The
Council has an ongoing commitment to support, and engage constructively with,
Town and Parish Councils. The Community
Strategy sets out actions and objectives which will be furthered by the
purchase of the land by Lake Parish Council for the purposes of public open
space. Actions 1.46 (Focussing
Development Towards Towns as promoted by the UDP), 1.63 (Strategic Management and Development Parks, Gardens and
Open Spaces) and 6.6 (Promotion of Sustainable Tourism) are likely to be
furthered by a committal of funds.
CONSULTATION
13.
Extensive
consultations have taken place with Lake Parish Council and with the seller.
FINANCIAL/BUDGET IMPLICATIONS
14.
The
loan could be met, pending repayment, from balances temporarily
unrequired. Any legal costs will have
to be found form existing budgets.
LEGAL IMPLICATIONS
15.
The
power to commit resources in support of the Parish Council is contained in
Part 1 Local Government Act 2000, and would demonstrably be consistent
with the Community Strategy.
16.
The
Council does not currently carry professional indemnity insurance for legal
work carried out on behalf of third parties including Parish Councils. The cost of such insurance is extremely high
and, should legal work be carried out in support of the voluntary purchase of
the land, it is suggested that this is done under call-off arrangements with a
local firm of solicitors. The modest
amount of legal costs incurred in a voluntary sale are likely to be
substantially greater than the costs of procuring insurance.
OPTIONS
17.
The
Executive may determine to :
(i)
Make
a grant of up to £20,000 (the maximum which was anticipated to have been
committed by the 30 July resolution).
(ii)
To
loan a sum of up to £20,000 on condition that the Parish Council take all steps
necessary to secure an alternative source of loan funding in the medium to
long-term (on reasonable terms to be agreed between the Parish Council and the
Strategic Director for Finance and Information).
(iii)
To
pay the legal costs of purchase, this should not exceed £2,000 plus VAT
(including the Counsel’s opinion already purchased).
(iv)
Provide
no support to the voluntary purchase.
EVALUATION/RISK MANAGEMENT
18.
The
Parish Council appear to have access to sufficient funds in the medium term to
fund the capital cost of purchase without a grant from the Council. The benefits to the Parish Council and the
community it serves of a grant or loan will be the speed and the cost of the
proposed purchase. The less amount the
Council has to borrow, the less ongoing commitment of its resources will be
necessary to service the loan. The
seller has been consistently clear that he wishes completion to be speedy. The process of securing loan funds is
expected to take several weeks at best and it is less likely that the sale will
be lost if the Local Authority is able to advance funds in a shorter timescale.
19.
Previous
decisions of the Executive have established a principle that legal costs will
be funded. A commitment to fund the
legal costs of a voluntary purchase would be consistent with that
principle. The legal costs of a
voluntary purchase will be a tiny fraction of those of compulsory
purchase. It is arguable that although
the principle of paying the legal costs associated with purchase remains
consistent the effect of that consistency is to diminish the amount of
financial support which is available to the Parish Council.
20.
The
commitment of resources will, of course, bear an opportunity cost in terms of
other spending commitments and proposals during the current financial
year.
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RECOMMENDATIONS 21.
Options (ii) and (iii) |
BACKGROUND PAPERS
22.
Reports
to Executive 30 July 2002 and 15 February 2001
23.
Correspondence
with Lake Parish Council and with seller
Contact Point : John Lawson, ( 823207,
e-mail: john.lawson@iow.gov.uk
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M
J A FISHER |
R
R BARRY |