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Quarterly Asset Management Report 171214-1.0

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Quarterly Asset Management Report 171214-1.0 Page 1 – Quarterly Asset Management Report (QAMR) Agenda Item: Cabinet 8(b) Date of Meeting 17 December 2014 Cabinet member(s) Robert Gould – Cabinet Member for Corporate Resources Peter Finney – Cabinet Member for Environment and the Economy Local Members All members (local members affected have been consulted/engaged separately) Lead Officer(s) Richard Bates – Chief Financial Officer Mike Harries – Director for Environment and the Economy Subject of Report Quarterly Asset Management Report Executive Summary Work is ongoing to re-write the County Council’s Asset Management Plan. One of the principal themes in the new plan will be the need to rationalise the number of properties that the County Council owns and to deliver services in a different manner. This will enable the County Council to reduce the running costs of its estate and the property maintenance backlog. This report is a quarterly update to indicate progress against certain key targets. It also includes sections on each of the main asset classes, i.e. Property, Highways, ICT, Fleet and Waste, covering approvals required and emerging issues. Impact Assessment: Equalities Impact Assessment: The County Council’s Asset Management Plans are reviewed regularly. The most recent equalities assessment identified the need to ensure that the interests and needs of the six equality groups are addressed at service level as part of the service asset management planning process, including consultation with users. Page 2 – Quarterly Asset Management Report (QAMR) Use of Evidence: The Asset Management Plan makes use of the following sources of evidence: • The Corporate Plan and Community Strategy • Medium Term Financial Strategy • Periodic consultation • Local and National property performance data • Service (property) asset management plans • Highways asset management planning data • Corporate IT strategy Budget: If all the recommendations in the report are approved, there will remain a sum of £11.183m unallocated in the period up to the end of 2017-18. The Asset Management Plan seeks to strike an appropriate balance between optimising service benefit, minimising environmental impact and maximising financial return in both the provision and use of property – not to achieve one at the expense of the other(s). Risk Assessment: There is a risk that it will not be possible to deliver this balanced approach during a period of financial austerity. Specific project risk registers are in place. None of the recommendations relate to or create high or medium risks. Having considered the risks associated with this decision using the County Council’s approved risk management methodology, the level of risk has been identified as: Current Risk: LOW Residual Risk: LOW Recommendations It is recommended that the Cabinet: (i) Approves the creation of a limited liability company for the management of North Dorset Business Park, the appointment of up to two officers as Director(s) of this company and for the common areas at North Dorset Business Park, and the freehold interest of plots that have been disposed of on long leases to be vested into this company (para 3.1.1) (ii) Approve s that the administration and payment of the grant funding allocated for a Weymouth Recovery Hub be delegated to the Director for Adult and Community Services in line with grant conditions, including authorisation to take an option to secure a suitable property or provide grant funding to BCHA to acquire a suitable property for the recovery hub on terms to be agreed by the Director for the Environment and Economy and the Chief Financial Officer. (para 3.1.2). Page 3 – Quarterly Asset Management Report (QAMR) (iii) Approves delegation of authority to the Director for Children’s Services, in consultation with the Cabinet Member for Education and Communication and the Chief Financial Officer, to over-commit the current Purbeck Schools Reorganisation Programme budget should it become unavoidable, but on the understanding that everything practicable will be done to contain costs within the current approved budget (para 3.1.3). (iv) Approves retaining ownership of Lamb House Bridge and entering into a long lease agreement with North Dorset Railway Trust (Shillingstone Railway Project) upon terms to be agreed by the Director for the Environment and Economy (para 4.1.1). (v) Approves the overall revised estimates and cash flows for projects as summarised and detailed in appendices 1 and 2 (para 8.2) (vi) Notes the compensation settlement in respect of the Weymouth Relief Road (para 4.2.4) (vii) Notes the emerging issues for each asset class. Reason for A well-managed Council ensures that the best use is made of its Recommendation assets in terms of optimising service benefit, minimising environmental impact and maximising financial return. Appendices Appendix 1 Financial Summary and Capital Control Totals Appendix 2 Financial Summary of Approved Capital Projects Background Papers The Property Asset Management Plan 2012-15 The Highways Asset Management Plan (Vol. 1/Vol. 2) Officer Contact Name: Peter Scarlett, Estate & Assets Manager Tel: (01305) 221940 Email: P.Scarlett @dorsetcc.gov.uk Name: Cyril Loveridge, Capital Programme Manager Tel: (01305) 225287 Email: c.p.loveridge @dorsetcc.gov.uk Name: Tony Diaz, Finance Manager Tel: (01305) 224950 Email: [email protected] Page 4 – Quarterly Asset Management Report (QAMR) 1 Background 1.1 This report provides an update on progress in a 1.2 This report covers all the County Council’s ass Management objectives, including property asset red approval for a number of transactions and project m 2 Assets / Whole authority performance and Waste (via DWP). 2.1 The County Council’s new Asset Management Plan running costs of the non-schools property estate by the authority will need to realign the estate along concept which the Cabinet approved in November 2013 flexible property estate, with services being deliv where there is an identified need. The County Coun working in its offices across the county which will of floor space that it occupies. The County Hall m 2.2 The previousdemonstrated Asset Management that by reconfiguring Plan had a target the accommodatio possible to accommodate a further 470 staff, enabli chieving the County Council’s Asset sq m of office space in and around Dorchester, with uction and rationalisation. It also seeks et classes:atters. Property, Highways, ICT, Fleet 25% by March 2015. Progress towards that target is will have a key target to halve the 30.00% Anticipated Percentage Reduction in Floor Area of E the lines March of the 2020. baseline In order property to achieve portfolio this, ered from strategic hubs, located in areas 25.00% . This entails developing a more enablecil it also to significantly proposes to reduce roll out the flexible amount aster plan business case has 20.00% ng then Countywithin County Council Hall, to yield it would up 5,100 be 15.00% a cost saving of £513,000 per annum. to reduce the gross area of the estate by Percentage10.00% Reduction highlighted in the flow chart below. 5.00% 0.00% Oct-10 state Feb-11 Jun-11 Oct-11 Feb-12 Jun-12 Oct-12 Feb-13 Jun-13 Oct-13 Feb-14 Date Jun-14 Oct-14 Feb-15 Jun-15 Oct-15 Feb-16 Jun-16 Oct-16 Page 5 – Quarterly Asset Management Report (QAMR) 2.3 Taking into account those assets declared surplus and committed to Dorset Development Partnership, it can be seen that the County Council has to date only been able to achieve three fifths of this target and it is likely to take until October 2016 to reach the 25% level. Consequently there needs to be a complete change in mindset if more challenging revenue reduction targets are to be achieved. This will entail service directorates working closely with the Estates team to identify how best to reduce their properties needs, based upon greater sharing of premises between the services, along the lines of the hub model. It will also be important to consult with local communities to identify their service needs and if property is essential to seek to tailor a solution that accords with those needs. The new Asset Management Plan will be presented to the Cabinet in March 2015. 3 Dorset Property Asset Management 3.1 Approvals 3.1.1 North Dorset Business Park Management Company (a) The County Council and the Homes and Communities Agency are joint owners of 12.5 acres of land at North Dorset Business Park, which is located on the A357, just outside Sturminster Newton. The plots are currently being marketed on 999 year leases. It is usual practice when setting up a business park to create a limited liability management company into which the freehold interest of the common areas and the plots that have been sold off are vested. The company would then be responsible for appointing a managing agent to oversee the management of the business park and each lessee on the park would own a share in this management company. (b) In order to set up the management company, the County Council has been asked to nominate one, or preferably two, persons to act as directors. These posts will be nominal, with no remuneration, and will cease once the County Council has disposed of all its land at the business park, or when other shareholders are willing to take on the roles. (c) The Cabinet is requested to approve the creation of a limited liability company for the management of North Dorset Business Park, the appointment of up to two officers as Director(s) of this company and for the common areas at North Dorset Business Park, and the freehold interest of plots that have been disposed of on long leases to be vested into this company (Recommendation (i)).
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