Land of Fikskerton Road

March 1, 2015 This document in confidential until after the meeting of the Parish Council 16th May 2015 This document in confidential until after the meeting of the Parish Council 16th May 2015

Table of Contents

2 | P a g e This document in confidential until after the meeting of the Parish Council 16th May 2015

Background

The untimely death of our local farmer Roy Bowser has created an opportunity for Cherry Willingham Parish Council to buy a section of land as an amenity and asset for the village. Preliminary research has shown that it is feasible that the land could be self-funding if it is used to create an income for the future

Specified Land The land in question is two fields & footpath to the river which equates to 16 acres, of which 10.2 acres is arable and 4.9 grass plus 0.88 for the footpath, on the south side of Fiskerton Road at the bottom of Cedar Avenue. Plus one field of 12 acres of grass on the north side of Fiskerton Road opposite Fen Farm. Total of 28.48 acres.

The 12.14 acres was marketed with a guide price of £100,000 and 172.57 acres with a guide of £1,280,000. From this the calculation for the guide price of the 28.48 acres was £221,000 which equates to an average of £7,767 per acre.

RICS The RICS/RAU Rural Land Market Survey is the leading survey on demand, supply and prices in the farmland market. The following quotes are from their web site. During the second half of last year, the average cost of farmland rose to £10,067 per acre across England and Wales, hitting a record high for the eleventh consecutive period. During the same period pasture lands rents rose by 3.4% in H2 and by 7.8% over the year to reach £107 per acre. The price that we have been quoted by the agent on behalf of the vendor is £9000+ for agricultural land and £6000+ the grass acreage. Giving a total of £140,000 for the fields & footpath south of Fiskerton Road and £80,000 for the land north of Fiskerton Road. Report by CWPC Finance Officer

In order for the Council to be able to consider a request for Borrowing Approval for the purchase of Land I provide the following information.

I understand the Council wish to purchase a 10 metre strip of land from Fiskerton Road to the River Witham (2.36 acres) together with fields adjacent to the strip of land extending to 16.5 acres in total. In addition, the Council are also interested in purchasing a further 12.14 acres of land to the north of Fiskerton Road, Cherry Willingham.

The land to be purchased would help to provide the following local village amenities:-

An access from Fiskerton Road to the River Witham.

Land for a future burial ground

Land for Allotments

Land for Woodlands and other recreational amenities

I have also been asked to provide information in order for the Council to borrow £200,000 to purchase the said land. Land is classed as a Capital Asset and may be purchased with a loan over a period up to 50 years. If the Parish Council were to seek a loan from the Public Works Loans Board (PWLB) the half yearly repayments would be as indicated in Appendix An attached.

If the Council chose to take a Fixed Annuity loan of £200,000 over 25 years the current interest rate would be 3.0% and the annual cost for the loan repayments would be approximately £11,428.

The same loan borrowed over a period of 30 years would have an interest rate of £3.17% and would increase the annual expenditure of the Council by approximately £10,380.

Over 40 years the interest rate would be 3.38% and would increase the annual expenditure by £9,156.

The Council has requested a Precept of £60,000 for the year 2015/16 (an increase of £10,000 over the previous year’s Precept). This will lead to an 18.14% increase in the Council Tax of a Band D property. The annual payment of a Band D property will now be £44.48. An increase of £6.83 per annum over the previous year.

Therefore, using the same criteria as for the Precept this coming year, a loan of £200,000 borrowed over a period of 30 years with annual loan repayments of £10,380 would increase the parish precept by a similar amount to 2015/16. i.e. about £7 per year or 13p per week for a Band D property.

Offer from WLDC

Waiting for quotes but they will offer a better rate than PWLB and do all the work for us.

Suggested ideas for use of Land to generate an income and provide a public amenity Access to the river and a circular walk mostly off road.

Allotments, rental income or resale

Grazing land – rental income

Woodland area and set aside – subsidies

Teenage area - skateboard/cycle track etc.

Solar farm

Anaerobic digester

Burial ground

Partnership with Journeyman Project

Income possibilities in red

Proposals for Land Purchase Decide between the options

Way forward Event in the library with displays, information, survey

APM as above

Internet & Facebook

Personal approach.

Ask resident the questions. Do you want a progressive council, looking for ways to self-finance the land with a view to the future?

Data Date: 26-Feb- 2015 PWLB

Annuity EIP

P Rate % Yearly Total Cost Rate Initial % Yearly Reduces by each Total Cost e Cost (£) Costs (£) % year (£) (%) (£) (%) (£) r Over 41/2 not over 1.72 20,958.15 209,581.50 1.72 21,720.00 172.00 209,460.00 5 Over 91/2 not over 2.21 11,200.60 224,012.00 2.20 12,200.00 110.00 223,100.00 10 Over 141/2 not 2.55 8,064.66 241,939.80 2.52 9,186.67 84.00 239,060.00 over 15 Over 191/2 not 2.79 6,557.98 262,319.20 2.74 7,740.00 68.50 256,170.00 over 20 Over 241/2 not 2.98 5,701.72 285,086.00 2.92 6,920.00 58.40 274,460.00 over 25 Over 291/2 not 3.14 5,170.52 310,231.20 3.06 6,393.34 51.00 293,330.00 over 30 Over 391/2 not 3.35 4,556.39 364,511.20 3.27 5,770.00 40.88 332,435.00 over 40 Over 491/2 not 3.39 4,165.78 416,578.00 3.38 5,380.00 33.80 370,690.00 over 50 Amount of Advance: 200,000.00

Note: 1. Although this report provides figures for repayment periods of between 5 and 50 years, in practice loans may be repaid over any period between 2 and 50 years. Amounts payable on loans from the

Board are calculated on the assumption that loans will run their full term as agreed when the loans were originally made.

2 If a borrower wishes to make a premature repayment of a loan, either in whole or in part, it should contact the Board giving full details beforehand. The Board will usually agree to accept this request but it should be noted that a premium will be payable when the interest rate on the loan to be repaid is higher than the current interest rate for a loan repayable by the same method and over the same period as that remaining on the loan which it is proposed to repay. When the interest rate on the loan to be repaid is lower than the current interest rate, a discount will be allowed.

Use of these data assumes compliance with the DMO's terms of use Term of use; http://www.dmo.gov.uk/ceLogon.aspx?page=about&rptCode=D9A

It should be remembered that any increases in Precept may be subject to Council Tax Referendum Principles.

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