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Enabling Community Asset Ownership & Management London Borough of Lambeth Date: 1 October 2012
Enabling Community Asset Ownership & Management
London Borough of Lambeth
Date: 1 October 2012
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Contents
1. Overarching Vision
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2. Purpose of the Policy
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3. Cooperative Council
- Cooperative Council - Community Hubs - Benefits of Community Ownership - National Policy Context
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4 Definitions
- Communities - Community and Social Enterprises - Meanwhile Use - Community Asset Transfer - Community Right to Bid - Community Right to Reclaim Land - Compulsory Purchase for Communities - Social value
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5. Exclusions
6. Guiding Principles
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7. Decision-Making Criteria
7.1 Eligibility Checker 7.2 Statement of Expectations 7.3 Decision-Making Process and Assessment Criteria 7.4 Asset Management: Roles and Responsibilities
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8. Supporting Procedures
8.1 Meanwhile Use 8.2 Community Asset Transfer 8.3 Community Right to Bid 8.4 Community Right to Reclaim Land 8.5 Compulsory Purchase for Communities
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10-11 12-15 15-18 18-19 20-23
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1. Overarching Vision The Council seeks to enable an increase in the community ownership and management of assets within neighbourhoods throughout the London Borough of Lambeth - to stimulate the creation of new social markets, underpin robust community enterprises capable of delivering high quality local services, and provide residents with new learning and employment opportunities.
2. Purpose of the Policy This policy describes how the Council will enable an increase in the Community Ownership and Management of assets consistent with Cooperative Council principles, its Community Hubs Strategy and national good practice. In summary, we will enable the acquisition and management of land and buildings by Community and Social Enterprises through the provision of support for –
• The Meanwhile Use of Assets;
• Community Asset Transfer;
• The Community Right to Bid or ‘assets of community value’ provisions;
• The Community Right to Reclaim Land; and
• Compulsory Purchase for Communities. This policy does not apply to council owned residential properties.
3. Cooperative Council The London Borough of Lambeth has established itself as a Cooperative Council which will give people more involvement and control of the services they use, as well as the places where they live, by putting council resources directly in their hands. The Council will continue to work with community representatives to explore neighbourhood approaches to designing and delivering public services. This includes building community capacity so that citizens can support an assessment of needs and move to leading the commissioning processes. It wants to enable an increase in Community Ownership and Management of Assets with these same principles of engagement and co-production borne firmly in mind. Hence, in December 2011, the Council began to engage communities in its proposal for Community Hubs and the consultation exercise. Specifically, the Council explained the financial challenges it faces, which point to the current policy of providing buildings to Social Enterprises as being unsustainable, and it needing to cease to provide this area of service within the next 3 years. It asked Community and Social Enterprises, more broadly, to consider plans for Community Hubs - “flexible, economical spaces for community groups, the statutory sector, social enterprises and small and medium sized enterprises to operate in, co-produce and deliver services from”. Integral to this, it canvassed opinion about the Council working to increase the sustainable ownership and management of buildings amongst Community and Social Enterprises. The Council regards the transfer, acquisition, ownership and management of land and buildings by Community and Social Enterprises positively for the following reasons:
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Benefits to Communities
• They are a tangible outcome to flow from the Council’s Cooperative Council vision, and devolve power to neighbourhoods to support greater community involvement in service commissioning and delivery.
• They can create opportunities to extend the use of a building or piece of land - increasing their value in relation to the number of people benefiting and the range of opportunities they offer.
• They can prevent the emergence of derelict or neglected land and buildings that can blight local communities, and act as a catalyst for social, environmental and economic regeneration.
• They can stimulate the direct involvement of local people in shaping and regenerating their communities, and can be a catalyst for local volunteering and increasing community cohesion.
• The process can build confidence and capacity amongst the individuals involved, and can support the creation of community leaders, as well as inspiring others to improve their community.
Benefits to the Council and other Public Service Commissioners/Providers
• The activities that are stimulated or safeguarded can contribute directly to the delivery of Council objectives.
• They can contribute to the Council’s objective to rationalise its estate and facilitate more effective and efficient use of its asset base, where the focus is on better services and community outcomes as a result of strategic asset management.
• They can contribute towards efficiency savings, and drive the diversification of the supply base for public services.
• They can provide a stimulus for cooperative working between Community and Social Enterprises, the Council and other partners, and improve the provision and accountability of services within communities (e.g. through clustering service providers in community-owned hubs).
• They can help to lever external investment into areas of need that council-run facilities struggle to attract (e.g. grant funding, social investment and local philanthropy).
Benefits to Community and Social Enterprises
• They can stimulate new social markets amongst Community and Social Enterprises and underpin more robust Community Organisations, which can create a wide range of benefits for the communities they serve.
• They can a provide Community and Social Enterprise with financial security, recognition and enhanced management capacity.
• They can strengthen the ability of Community and Social Enterprises to build their capacity to take on the delivery of public services and develop as community enterprises.
• They can result in the creation of a new Community and Social Enterprises (as well as consortia and joint ventures) with the ability to lever in additional resources, which would be unavailable to the Council acting independently.
• They can stimulate greater involvement amongst communities and increase the potential to raise money through local philanthropy and the engagement of local employers (e.g. corporate social responsibility).
The Council acknowledges that communities will be motivated to act for a range of reasons, to different extents, and having recourse to different legal mechanisms. However, in recognition of the benefits that can flow from the transfer, acquisition, ownership and management of land and buildings by Community and Social Enterprises, it will be proactive in supporting their use.
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The Council, therefore, aims to create a transparent, positive and proactive framework to enable an increase in Community Asset Ownership and Management to happen over the next 3-5 years and be successful in the longer-term. In particular, it wants to support the development of Community Hubs that provide a home where community growth, community action, volunteering and enterprise can all be nurtured. It has developed a Community Hubs Strategy to accompany this policy, these sets out the response to its consultation exercise and related plans in detail. The National Policy Context
The Community Ownership and Management of Assets are not new - it has a well-documented history going back hundreds of years. However, it is arguably only in recent years that the momentum behind community ownership and a deep understanding of its benefits has gathered pace. The Meanwhile Use of assets gained traction as economic circumstances and an increase in internet shopping began to impact high streets, resulting in an average 25% of retail units becoming vacant in many areas across the country. The Government supported a dedicated programme to explore its value as an approach, and Social enterprises began to negotiate short-term peppercorn leases with public and private asset owners in a bid to re-animate areas experiencing decline ‘in the meanwhile’ (i.e. until such time as the private market recovered). Community and Social Enterprises expanded their horizons to also manage derelict land and buildings on the same basis - to help sow the seeds for longer-term regeneration through the provision of affordable start-up and exhibition spaces, as well as to support renewed interest in community food growing and selling schemes. Since 2010, the policy context has changed significantly, with the agenda for community asset transfer and a more active civil society, arguably, accelerating under the direction of the current Government. This has resulted in new community asset acquisition and development tools – notably, Neighbourhood Planning and the Right to Bid and build provided for within the Localism Act (2011); the Public Request to Order Disposal (PROD) provisions refreshed and extended as the Right to Reclaim Land; and, revisions to Compulsory Purchase guidance to support Community Organisations. These statutory provisions offer Community and Social Enterprises new mechanisms with which to acquire and develop land and buildings over the years to come, and to the extent that they apply increasingly to land holdings as well as assets that are held in private ownership, are intended to increase the role of the community in proactive place-shaping and regeneration efforts. Calls to better engage Community and Social Enterprises in the commissioning and delivery of public services are also being firmed up – with additional implications for the future ownership and management of neighbourhood assets by Community Organisations. It is against this backdrop that the Council’s Community Hubs Strategy and policy framework for enabling an increase in Community Asset Ownership and Management should be viewed.
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4. Definitions This section sets out what is meant by terms used throughout the Council’s policy: Communities – self-defined groups that live or work in the London Borough of Lambeth. Community and Social Enterprises – formally constituted not-for-private-profit vehicles -
including Charities, Community Organisations, Charitable Companies, Community Interest Companies Limited by Shares (CICs), and Industrial and Provident Societies for the Benefit of Communities (IPSs). Meanwhile Use of Assets – a short-term leasehold arrangement entered into by the Council with a Community and Social Enterprises to stimulate interim usage of disused or under-utilised land and buildings, in keeping with the provisions outlined within Circular 06/03: Local Government Act (1972) General Disposal Consent (2003) and the Public Services (Social Value) Act (2012). Community Asset Transfer – a long-term leasehold or freehold transfer arrangement entered into by the Council with a Community and Social Enterprise at market or below market value to stimulate the social, economic and environmental well-being of people living and working in the London Borough of Lambeth, in keeping with the provisions outlined within Circular 06/03: Local Government Act (1972) General Disposal Consent (2003). Community Right to Bid – an asset nomination, registration and auction process entered into by the Council with a Community and Social Enterprises, to stimulate social well-being, in keeping with the provisions outlined within the Localism Act (2011). Community Right to Reclaim Land – a request, response and sale entered into by the Council
with a Community or social enterprise, to stimulate the development and use of disused or under-utilised land and buildings owned by public bodies, in keeping with the provisions outlined within the Local Government, Planning and Land Act 1980. Compulsory Purchase for Communities – a request, support and back-to-back transfer process entered into by the Council with a Community and Social Enterprise, to stimulate regeneration through the acquisition of disused or under-utilised assets owned by private individuals or entities, in keeping with the provisions outlined within Circular 06/04: Compulsory Purchase and the Crichel Down Rules - Appendix KA (2011). Social Value - What we mean by social value is that we will consider and take into account wider
‘value added’ impacts and softer outcomes when considering requests under this policy rather than simply narrow financial returns.
5. Exclusions The Council will support the transfer and acquisition of assets by Community and Social Enterprises throughout the London Borough of Lambeth, where they meet those public interest and organisational tests that are outlined later in the policy. In doing so, it will have regard to its statutory obligations (in particular, its fiduciary, planning and equalities duties) at all times. The Council will consider proposals and agree terms and conditions on a case by case basis,
and will not rule out discussions about any asset or arrangement with individual Community Organisations, save where it is constrained by the scope and force of relevant statutory instruments. It will, nonetheless, operate related procedures on the basis of providing a proportionate response that takes into account the interests of the Council, as well as those of social enterprises and the wider community.
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6. Guiding Principles The Council’s policy is underpinned by the following principles:
• The Council will adopt a proactive approach to enable engagement with and the involvement of diverse communities;
• The Council will adopt an approach that is tailored to meet the needs of Community and Social Enterprise more broadly – acknowledging that people will approach it with diverse motives and be capable of/willing to utilise different legal mechanisms to achieve the community ownership and management of assets; and
• The Council will adopt an approach that seeks to build upon existing community assets – in the broadest sense – i.e. people, social enterprises, local businesses, skills, time and money.
• When considering transfer requests, which are below market value the Council will need to be satisfied of the social value and alignment with its cooperative commissioning priority outcomes. These types of requests will be managed on a case by case basis within the assessment framework.
• If below market value is agreed the Council will apply appropriate legal restrictions to the transfers to ensure the asset remains in community benefit and for the purpose agreed in perpetuity.
• The appeals process for any decisions taken within the context of this policy will be instigated through the appropriate Ward Councillors.
7. Decision-Making Process & Criteria This section summarises how the Council will approach discussions about nominations and expressions of interest received in relation to each of the legal mechanisms that are covered by this policy statement. Specifically, it provides a headline:
• Eligibility checker
• Statement of expectations and
• Outline of the decision-making process and assessment criteria. Comprehensive supporting procedures are provided in Section 9 to accommodate the detail of those legal provisions that underpin each approach route. 7.1 Eligibility Checker
Section 5 of the Policy defines what is meant by Community and Social Enterprises. It also makes clear where Community and Social Enterprises are deemed eligible to use those legal mechanisms that are covered by the Policy. However, in addition, the Council will apply Public Interest and Organisational tests in operating the Policy. In particular, applicants must be -
- Community-led (i.e. its proposed/existing governance arrangements must demonstrate that it has strong links with the local community, and that members of the community are able to influence its operation and decision-making processes);
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- A Community or legal entity that exists to perpetuate social, economic or environmental benefit in the London Borough of Lambeth, is non-profit distributing (i.e. it must reinvest any surpluses generated to further its intended aims), and can demonstrate community benefit objectives;
- Appropriately constituted and capable of demonstrating good governance through open, accountable and cooperative processes, with adequate monitoring, evaluation and financial management systems;
- Capable of managing an asset and delivering services from the point of view of relevant skills, experience and capacity;
- Able to demonstrate how they will embrace diversity, work to improve community cohesion and reduce inequalities.
7.2 Statement of Expectations
Council Members and Officers are committed to enabling an increase in the ownership and management of assets by communities throughout the Borough where it can stimulate the creation of new social markets, underpin robust community enterprises capable of delivering high quality local services, and provide residents with new learning and employment opportunities. As such, its policy sets out the minimum standards communities can expect of the Council in relation to each of the legal mechanisms it covers, as well as those expectations of Communities and Social Enterprises the Council seeks to make transparent and accessible. 7.3 Decision-Making Process and Assessment Criteria
Decision-making processes, complete with indicative timescales, are set out in Section 9 in relation to each of the legal mechanisms covered by this policy.
Where the Council receives an Expressions of Interest from Community and Social Enterprises - either in relation to the Meanwhile management of assets or, in relation to an asset transfer – a panel comprised of officers from the Council will assess and evaluate them against the following criteria: Organisational Test
• Legality • Accountability • Governance • Quality • Adaptability • Value for money • Equality and inclusion • Deliverability • Affordability
Assessment 1: Organisational Test
Undertaken by the Active Communities Team who will present their findings to the cross departmental panel.
Assessment 2 Public Interest Test
The cross departmental panel will under the Public Interest test and make recommendation to Strategic Asset Management Group
Assessment 3 Decision The Strategic Assessment Management Group (SAMG) will take a decision or refer the matter to the Cabinet Advisory Panel.
Optional Cabinet Advisory Panel will determine those requests that have been referred to them by SAMG.
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Public interest test
1. The organisation:
- Viability/Sustainability - Intentions of the organisation - Additional activities - Compliance with regulations and laws
2. The idea
- Who will benefit from the proposal? - Is there a real need for the proposal? - Does the idea proposal link with broader strategies? - Does the proposal achieve value for money?
3. Cooperative
- How involved are residents in coproducing the proposal? - Activity that offers opportunity for the broadest possible engagement, including traditionally excluded communities. - Methods and activities of on going consultation and involvement
The Panel will if required, invite the Community and Social Enterprise to meet with them to discuss the Expression of Interest and then communicate the outcome of its deliberations, setting out the rationale for its decisions, in an open and transparent manner in keeping with good practice. The officer assessment will be presented to the Council’s Strategic Asset Management Group (SAMG) for consideration. SAMG will consider the report and determine a decision. The Community and Social Enterprise, making the request, may seek appeal of any decision taken by SAMG through an appropriate Ward Councillor, who will be able to make representation to the Cabinet Member with responsibility for asset management on behalf of the individual Community and Social Enterprise. The outcome of this appeals process will be final. 7.4 Asset Management: Roles and Responsibilities
The Council expects all community asset managers and sub-tenants of Council owned properties to enter into a Memorandum Of Understanding (MOU) with it, in addition to entering into formal lease agreements, to agree roles and formalise expectations in relation to asset management responsibilities. Specifically, the MOU will formalise the process for accessing advice and support from the Council, as well as the route to redress by the Council, in the event that ‘things go wrong’ for the community asset manager.
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8. Supporting Procedures
8.1 Meanwhile Use Definition: a short-term leasehold arrangement entered into by the Council with a Community
Organisation, market or discount to market value and may or may not imply business rate relief, to stimulate interim usage of disused or under-utilised land and buildings. (a) Eligibility Checker The Council will consider Expressions of Interest from Community and Social Enterprises to manage land and buildings on a meanwhile or interim basis. (b) Headline Statement of Expectations – both of the Council and Community and Social Enterprise
- The Council will promote the Meanwhile Use of land and buildings across the Borough, support the identification of asset owners, act in a facilitative capacity towards owners and interested parties, and contribute to negotiations between Community and Social Enterprise and landlords and/or business rating agencies;
- The Council will identify and proactively market opportunities for the management of some of the land and buildings that it owns on a meanwhile or interim basis – by which it means, for up to three years;
- The Council will provide basic information about the land and buildings it markets for management on a Meanwhile basis – including outline plans, recent utility bills, previous uses, confirmation of planning permissions and future intentions;
- The Council may offer land and buildings for Meanwhile management on the basis of a peppercorn rent and insert a break clause in the landlord’s favour in any Meanwhile lease it agrees, affording it the right to terminate the agreement with 30 days notice;
- The Council will retain repairing and maintenance obligations in any Meanwhile lease it agrees, and will not solicit business rates from Community and Social Enterprises for the Meanwhile management of land and buildings;
- A Community and Social Enterprise that seeks a Meanwhile lease must submit an Outline Business Case, Meanwhile Strategy and Supporting Documentation for consideration by the Council in response to those land and buildings the Council markets as eligible;
- A Community and Social Enterprise that agrees a Meanwhile lease with the Council will assume responsibility for insurance and utilities and be called upon to return the property in equivalent condition;
- A Community and Social Enterprise that enters into a Meanwhile lease with the Council will be permitted to issue a sub-lease or management agreement in keeping with its Meanwhile Strategy.
- A Community and Social Enterprise that enters into a Meanwhile lease with the Council will commit to activating the space for a minimum 3 days/week.
(c) The Outline Business Case, Meanwhile Strategy & Supporting Documentation A Community and Social Enterprise that seeks to enter into a meanwhile lease agreement with the Council will be called upon to submit:
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- An Outline Business Case: a business case that is proportionate to the undertaking
providing details about the Community and Social Enterprise, the aims/objectives of the project, and associated financial plans.
- A Meanwhile Strategy: plans for promoting, animating and curating use of the land
and/or building(s) in keeping with the aims and objectives of the project.
- Supporting Documentation: confirmation of its memorandum and articles of
association, accounts (where available), certificate of public liability insurance and certificate of employers liability insurance (where applicable).
(d) Indicative Time Scales
Time Frame Stage Responsibility
1 month A Community and Social Enterprise submits an Expression of Interest Form – completing headline information about themselves, identifying the land or building(s) they propose to manage on a meanwhile basis, and providing a headline statement about their aims/objectives.
Community and Social Enterprise
14 days The Council provides the social enterprise with basic information about the land and building(s) identified, and arranges for the Community and Social Enterprise to gain access/view the property.
Council
1 month Community and Social Enterprise submits and Outline Business Case, Meanwhile Strategy and Supporting Documentation
Community and Social Enterprise
1 month Review & Negotiations
Council / Community and Social Enterprise
(e) Assessment Criteria In addition to Public Interest and Organisational tests, the Council will review Meanwhile Use proposals to ensure that they fit with and not prevent the development of spatial plans; protect against further dilapidation of assets; will preserve or improve the quality of the space; and, include scope for appropriate benefits to flow (e.g. increased footfall; renewed interest from the private rental market; opportunities for training, volunteering and employment, opportunities to test new ideas and businesses; and provide value-add services for local communities). The Review will also pay close attention to the viability of proposals, their deliverability and their sustainability for the duration of the meanwhile term proposed.
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8.2 Community Asset Transfer Community Asset Transfer – a long-term leasehold or freehold transfer arrangement entered
into by the Council with a Community Organisation or Parish and Town Council, at market or below market value, to stimulate the social, economic and environmental well-being of people living and working in the London Borough of Lambeth (a) Eligibility Checker The Council will consider Expressions of Interest from Community and Social Enterprise and Parish and Town Councils to take ownership of land or buildings for the long-term on the basis of an asset transfer. (b) Headline Statement of Expectations
- The Council will promote the transfer of land and buildings that public bodies own across the Borough to Communities and Social enterprise;
- The Council will identify and proactively market opportunities for the transfer of land and buildings it owns for the long-term – by which it means, a minimum of 25 years via a lease through to the transfer of a freehold – in the interests of transparency and fairness;
- The Council will provide comprehensive information about the land and buildings it markets for transfer – including outline plans, recent utility bills, previous uses, confirmation of planning permissions and future intentions, condition and relevant covenants – in keeping with good practice and open data principles;
- The Council will offer land and buildings for transfer on a proportionate basis – ranging from peppercorn rents through to moderate discounts, where the opportunity cost of foregoing market rental or market sale is considered more significant - and insert a break clause in the transferee’s favour in any lease it agrees, affording it the right to terminate the agreement with 30 days notice;
- The Council will transfer repairing, insuring and maintenance obligations in agreeing to transfer assets, and will work with relevant agencies to provide confirmation of applicable business rates from the outset;
- A Community and Social Enterprise that seeks to take ownership of land and buildings through an asset transfer from the Council must submit a Full Business Case and Supporting Documentation for consideration by the Council in response to those land and buildings the Council markets as eligible;
- A Community and Social Enterprise that agrees an asset transfer with the Council will assume full responsibility for repairs, insurance, maintenance and utilities, and be called upon to maintain property in keeping with statutory provisions and good practice (e.g. in relation to Health and Safety);
- A Community and Social Enterprise that enters into a long-term lease with the Council will be permitted to issue a sub-lease or management agreement.
- A Community and Social Enterprise that enters into a long-term lease with the Council will be expected to produce a statement of community benefit on a quarterly, six-monthly or annual basis for up to 3 years (although this will not constitute a Service Level Agreement) - to track its progress in delivering against its Full Business Case.
(c) The Business Case & Supporting Documentation A Community and Social Enterprise that seeks to take ownership of land or buildings owned by the Council on the basis of an asset transfer will be called upon to develop:
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- A Full Business Case (FBC): information about the social enterprise (its track record,
current plans, partnerships and people, governance, legal structure); the Project (objectives, programme for delivery, proposed impact/benefits, management and operational arrangements and, where relevant, any capital construction works); the Market (the local need the project will respond to, beneficiaries, demand for the products/services to be supplied, customers, related provision in the local area, scope for collaboration/competition, pricing for rentals/services); Promotion (marketing strategy, methods, means); Resources (financial projections, 1yr cash-flow, 3-5yrs budget, profit/loss and capital expenditure plans, rationale); and, Risk Profile (assessment, management and mitigation strategy).
- Supporting Documentation: governing documents, evidence of external advice
solicited, expressions of support from partners/stakeholders and, where available, accounts.
(d) Indicative Time Scales The following time scales are intended as indicative only – some asset transfers may progress more or less swiftly, according to the particular circumstances. Time Frame Stage Responsibility
1 months Community and Social Enterprise submits an Expression of Interest Form – completing headline information about themselves, identifying the land or building(s) they propose to take ownership of, and providing a headline statement about their aims/objectives.
Community and Social Enterprise
2-3 months Request is referred to the Strategic Asset Management Group (SAMG) for endorsement. Once endorsed, the Lead Service (the Council service with most appropriate links to the organisation requesting an asset transfer) assumes the role of sponsor and co-ordinates the Council’s response to the request – which includes producing a report to the Asset Management Cabinet Advisory Panel and, later, to Cabinet for a decision - supported by the Property Team. The Council will appoint a Single Point of Contact with whom the social enterprise should liaise hereafter. Work may be needed to verify the credentials of the social enterprise, and to ensure that others operating in the area are aware, consulted and have been able to make representations. In the event of competition for the same asset, collaboration will be encouraged in the first instance – but, competition will be treated as an opportunity to ensure that the Council selects the most appropriate transfer partner.
Council
1 month The Report to the Asset Management Cabinet Advisory Panel or its equivalent will detail relevant information which Councillors need in order to make an informed decision. This will include information about the social enterprise, the asset (value, repair, condition/suitability, use) and the community benefit potential of the asset transfer (e.g. efficiency savings for the Council, opportunity to consolidate service provision within fewer buildings, increasing sustainability of the proposed recipient, etc).
Council
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The Panel’s decision (if support for the transfer is obtained) will be ‘in principle’. In effect, it will represent a decision to proceed with exploring the feasibility of the transfer, and it will be subject to receipt and review of the Full Business Case and Supporting Documents. Other issues that may need to be resolved at this juncture could include Procurement, State Aid and TUPE considerations, as well as associated funding. The Council might also set other conditions at this time.
6 months Community and Social Enterprise develops the Full Business Case, maintaining regular contact with the Lead Service. The Council provides the information required to make the development process as straightforward as possible, and offers to review the emergent business case at regular intervals. During this time, the Council and the social enterprise will also develop in principle agreements around heads of terms, levels of discount, length of lease with legal and finance officers.
Community and Social Enterprise / Council
2 months Lead service report to Cabinet is submitted in support of the full business case, recommending the asset transfer and outlining the terms and conditions.
Council
1 month The asset transfer may be immediate. However, the Council recognises that there may be significant advantages to a phased handover in some cases (e.g. where capital works are to be undertaken).
Council / Community and Social Enterprise
A pre-requisite of success is an ongoing relationship between the Council and the social enterprise. This may take the form of technical support and advice, exploring the commissioning and co-location of services, providing support during any capital works phase, etc.
Council / Community and Social Enterprise
(e) Assessment Criteria In addition to Public Interest and Organisational tests, the ground rules against which prospective transfers will be identified, assessed and taken forward are as follows:
1. Assets made available for transfer will be advertised for transfer, unless they are cited in relation to a strategic decision to use asset transfer as a method for achieving wider regeneration objectives (i.e. capable of stimulating new social markets and/or underpinning thriving social enterprise).
2. When a number of parties express interest in an asset marketed for transfer, the Council will encourage collaboration. However, if this is not possible, a competitive process will be overseen by the Asset Management Cabinet Advisory Panel, and only the successful organisation will be invited to develop a Full Business Case for consideration.
3. Community and Social Enterprise will need to demonstrate community support for their proposals, a robust business plan in support of the transfer and a high level of organisational capacity (relevant to the scale and scope of the asset and enterprise). The Council will only consider asset transfer where the social enterprise has demonstrated the capacity to manage the building appropriately (although, the Council recognises that organisations may be able to develop this capacity, and will be given the opportunity to do so if commitment and potential can be demonstrated).
4.
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5. The Council will generally pursue long-leasehold arrangements when considering asset transfer. Although freehold is not ruled out, any transfer proposal will need to make a strong case that freehold is a necessity for success, and provide reassurance that community benefit will be maintained in the long-term. Discounts applied to the market value of a lease or freehold will be proportionate – i.e. set on a case-by-case basis in relation to the type of property, a robust assessment of the Community Organisation’s business plan, and the extent of community benefit to be derived.
6. The decision to transfer an asset will not be regarded as setting a precedent. Each asset transfer will be judged on its own merits, and the detail of the transfer arrangements will be arrived at through cooperation and negotiation.
Assets transfers to Community and Social Enterprise will create the widest public value, and will be judged within the assessment framework and the following criteria:
- How will the interests of the local community be better served by discounted transfer than open market sale?
- What social, economic and environmental benefits will be realised by the transfer?
- How will the transfer result in improvements to safeguarding and community cohesion, provide new local services and activities, or stimulate training and employment opportunities?
- Who will benefit from the transfer? How many people will benefit? Over what time period are communities expected to benefit from the transfer in different ways?
- Will the transfer build the capacity of a social enterprise and encourage greater
organisational and financial sustainability in the long-term?
8.3 Community Right to Bid (Assets of Community Value) Definition: The Localism Act (2011) introduces the Community Right to Bid - placing a new duty
upon local authorities in England and Wales to maintain a list of land in their area, that is land of community value, as nominated by the local community. If any land or buildings on this list come up for sale, the local community will be given six months to prepare a bid to buy the land.
(a) Eligibility Checker Definition of an Asset of Community Value An asset of community value is a piece of land or a building, already or recently in community use, which promote social well-being – in particular, though not exclusively, cultural or sporting or recreational assets. Eligibility to Nominate an Asset of Community Value The following bodies are deemed eligible to nominate an Asset of Community Value:-
- A voluntary or community body with a local connection – i.e. any of the following types of group, whose activities are partly or wholly related to the Borough;
- An Unincorporated Group with at least 21 members who are on the electoral register in that local authority area;
- Neighbourhood Forums; and - Community Interest Groups – i.e. legally constituted Community Organisations.
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Eligibility to Trigger the Full Moratorium The following bodies are deemed eligible to trigger the full moratorium in relation to an Asset of Community Value for the purposes of this policy – a Community Interest Group. NB: the full moratorium can be triggered by any eligible body. Exemptions provided for within Regulations Some types of disposal are exempt from the moratorium process, even if the asset is listed is an Asset of Community Value:
- Disposal through the gift of an asset - Disposal of an asset containing a business which uses the asset and which is a ‘going
concern’ (e.g. a shop still in operation) - Disposal within a family or a partnership or between trustees of a trust or between
companies in a group - Disposals in the execution of a will or arising from various legal proceedings - Disposal of an asset that is part of a larger estate, part of which is not listed, but where
the whole estate is owned by same person and is a single lot of land Some further exemptions will be set out in the Regulations, and are expected to include:
- Disposals from one NHS body to another - Disposals for ongoing educational provision - Disposals between connected companies - Disposals as a result of court order - Disposals as a result of bankruptcy or insolvency
NB: housing and church buildings are altogether exempt from the asset of community value provisions. (b) Headline Statement of Expectations
- The Council will promote the nomination of Assets of Community Value to ensure there is a good level of awareness of the provisions contained within the Localism Act (2011) and related benefits.
- The Council will maintain and publish a list of land in its area that is land of community
value, as nominated by an eligible body. It will also maintain a list of assets identified as unsuccessful nominations. Entries will be included on the list for up to 5 years.
- The Council will inform the nominating body, the asset owner, any lawful occupier and
the Land Registry within 8 weeks when it intends to register an Asset of Community
Value.
- The Council will review a decision to register an Asset of Community Value upon receipt of a written request from the land owner, and formally notify them of the outcome and rationale. The land owner can subsequently appeal to an Independent Tribunal if s/he wishes.
- The Council will inform the nominating body if it does not intend to register an Asset of Community Value and/or an asset is removed from the list following a Review or Appeal process.
- The Council will consider whether there is scope for it to explore an asset transfer of any
asset that it owns that is nominated or registered as an Asset of Community Value, inform the nominating body, and proactively market the asset accordingly.
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- Whenever a landowner wishes to sell an Asset of Community Value, they will need to inform the Council. The Council will then amend the published list to confirm that a notice has been received, the date when the notice was received, and the dates of the interim, full moratorium and protected periods within 5 working days. It will also inform the
nominating body and publicise the interim moratorium period more widely, so that any eligible body from the wider community is afforded six weeks to confirm whether they
wish to prepare a bid to buy the land.
- If no eligible body submits an Expression of Interest, the land owner is free to dispose of the land, and the Council will inform them to that effect.
- If an eligible body expresses interest in preparing a bid to buy the land, the Council will
inform the property owner, who is then prevented from selling the property for a period of six months from the date notification was received from the land owner, or until such time as the eligible body has confirmed its readiness to bid (whichever is shorter). The eligible body is not obliged to prepare or submit a bid to buy the land.
- The Council will provide comprehensive information to nominating bodies about those
land and buildings it owns that are registered as Assets of Community Value, and which it intends to dispose of – including outline plans, recent utility bills, previous uses, confirmation of planning permissions and future intentions, condition and relevant covenants – in keeping with good practice and open data principles.
- The land owner is entitled to market the property for sale at the end of the full moratorium
period, and is not required to sell the asset to the nominating body. However, the land owner can come to a mutual agreement with any eligible body and complete the sale before the end of the full moratorium period, if s/he so wishes. Moreover, the Council will promote the benefits of the Community Ownership and Management of assets that are outlined in this Policy to increase awareness amongst the wider community, including land owners, to further support its overarching aims and objectives to enable its growth.
- In the event that a sale to an eligible body does not take place during the full moratorium
period, or immediately it comes to an end, the land owner will benefit from an 18 month protected period (from the date of the initial notice to sell) during which s/he is free to dispose of the property without further moratoriums.
- A private land owner who believes they have incurred a loss as a result of complying with
these procedures can apply for compensation from the Council. (c) Documentation To Nominate an Asset of Community Value – the eligible body should provide clear
identification of the asset, the reason why it qualifies as an asset of community value, identification of the nominating organisation and some proof of eligibility (e.g. if an unincorporated group, the name of the group and a list of at least 21 named local members). Any form of written submission will be accepted - whether online, by email or by letter. To Confirm Successful Nominations – the Council will give written notice of inclusion on the
register to the person that nominated the asset, the asset owner, any lawful occupier and the Land Registry. To Trigger the Full Moratorium – eligible bodies should provide the Council with written
confirmation of their interest in preparing a bid to buy an Asset of Community Value. They are not required to provide further details of their bid or demonstrate that a viable bid is possible.
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To Submit a Competitive Bid for Council-Owned Assets of Community Value - the Council
will invite nominating bodies to submit a Full Business Case and Supporting Documentation for internal Review to augment their Bid. Although this is not mandated by the provisions within the Localism Act (2011), it will help the Council to consider its broader value for money obligations in the event of a competitive situation.
8.4 Community Right to Reclaim Land (PROD) Definition: a process entered into by the Secretary of State for the Department for Communities
and Local Government (DCLG) to consider the disposal of publicly owned land, in response to a request from members of the public, to stimulate the development and use of disused or under-utilised land or buildings, commonly known as the Community Right to Reclaim Land or “Public Request to Order Disposal” (PROD). (a) Eligibility Checker The Statutory Public Request to Order Disposal (PROD) process applies to public bodies included in Schedule 16 of the Local Government Planning and Land Act (1980). Under the Act, the Secretary of State for DCLG has powers to list disused or under-utilised land and buildings cited as such by any person s and direct their owners to dispose of land or property where they are:
§ the Council § Transport for London (TFL) § the Greater London Authority (GLA) § the London Fire and Emergency Planning Authority § the Metropolitan Police § the Environment Agency § other “statutory undertakers” – e.g. Network Rail
The Secretary of State can also make a recommendation to public bodies not covered by the law in relation to land that they own, but cannot direct that they dispose of it. (b) Headline Statement of Expectations
- The Council will promote the bringing to the Council’s attention of land or buildings in the Council’s area that are in public ownership which are not currently used or are under-used - particularly where there is evidence to show that there are constructive alternative proposals for such sites.
- The Council will make it clear on the Council’s website which officers should be approached by Community Organisations(the initiators) wishing to make a case for approaching DCLG in relation to a possible PROD request.
- Where the Council receives such an approach, and the Council itself is not the owner, the Council will take steps to identify and contact the owner of the relevant site to encourage resolution of the situation without use of statutory powers. The Council will give a reasonable period of time to seek such resolution. Where the approach relates to Council owned land, the Council will review current and future use and will make a full response.
- If informal resolution cannot be achieved, the Council will consider how to support Social Enterprise in an approach to the Secretary of State for DCLG, where the Council itself is not the owner of the land in question. Social Enterprises should expect, at this stage, to be asked as a minimum for evidence that the site in question is not currently used or, else, is underused.
- The Council will work with social enterprise to ask the Secretary of State to exercise their power to direct disposal under section 98.
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NB: Social enterprises are within their rights to ask the Secretary of State to exercise his power to direct disposal (where relevant powers permit) without input or support from the Council if they so wish. The process is outlined: http://www.communities.gov.uk/publications/housing/prodprocessexplanation (c) The Business Case A Community Organisation that seeks the support of the Council in relation to a PROD may be asked to develop: A case for the use of PROD - including information about the site and any information on current
neglect, underuse or under-occupation, as well as background information on the Community Organisation, which may lead to a requirement to demonstrate a Full Business Case for use after disposal if the Community Organisation intends to purchase the land at the point of disposal being ordered and pursued. (d) Indicative Process
Time Frame Stage Responsibility
2 months Community and Social Enterprise approaches the Council with details of the site. Council ascertains ownership, reviews use of site, and enters into informal discussions with site owners.
Community and Social Enterprise / Council
Where there is no resolution, Council and Social Enterprise work together to prepare application to the Secretary of State
Social Enterprise / Council
DCLG National Planning Casework Unit (NCPU) will consider request, check land is eligible, contact land owner, and gather evidence.
DCLG
DCLG NPCU will consider evidence and make their assessment of the request to prepare a report for senior officials or Ministers.
DCLG
DCLG issues initial decision to affected bodies, considers any representations made
DCLG
DCLG issues final decision DCLG
(e) Assessment Criteria The Council will assess in each case whether there is a case for asking the Secretary of State to use the powers in the Act. As part of this consideration, the Council will consider:
- the under-use or lack of use of the asset - the owner of the asset - any perceived threat to the asset - the future use of the asset and the proposals as to any development and long-term
management of the site - any relevant planning issues
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The Council will consider in each case whether additional information is needed, and will review each approach on its merits.
8.5 Compulsory Purchase for Communities Definition: a request, support and back-to-back transfer process entered into by the Council with
a Community and Social Enterprise, to stimulate regeneration through the acquisition of disused or under-utilised assets owned by private individuals or entities, in keeping with the provisions outlined within Circular 06/04: Compulsory Purchase and the Crichel Down Rules - Appendix KA (2011). (a) Eligibility Checker The Council is able, as a local authority, to exercise the powers of compulsory purchase of land in certain circumstances. The general law on compulsory purchase is complex and there are a wide variety of situations in which the Council – or another public body – may seek to obtain a compulsory purchase order (“CPO”). This is most usually done arising from the Council’s powers in relation to planning. Appendix KA of Circular 06/04: Compulsory Purchase and the Crichel Down Rules (“the Circular”) asks the Council to “particularly” consider requests from Social enterprises to use its powers. (b) Headline Statement of Expectations
- The Council will promote the bringing to the Council’s attention of sites in the Council’s area which are blighted, neglected, or not in constructive use, particularly where there is evidence to show that there are constructive alternative proposals for such sites.
- The Council will make it clear on the Council’s website which officers should be approached by social enterprises wishing to make a case for a “community CPO”.
- Where the Council receives such an approach, the Council will take steps to identify and contact the owner of the relevant site to encourage resolution of the situation without use of statutory powers. The Council will give a reasonable period of time to seek such resolution.
- If informal resolution cannot be achieved, the Council will consider whether to use its statutory powers in relation to the acquisition of the site. Social enterprises should expect, at this stage, to be asked to demonstrate the Business Case for compulsory acquisition.
- Community and Social Enterprise promoting CPO use and onward transfer to themselves may be asked to provide an indemnity for the relevant costs to the Council, to cover the Council’s costs in seeking the CPO and the cost of compensation to the owner(s). The Council will consider in each case how the costs of acquisition are to be funded.
- The terms of any transfer from the Council following the CPO will take into account the principles established in relation to the sections in this policy on Community Asset Transfer. Where the Social Enterprise is funding the costs of the CPO Indemnity in full, then transfer from the Council will normally be at nil consideration or for a peppercorn if a long lease is used.
- If the Council declines to use its CPO powers in relation to an approach from a Social Enterprise, then the Council will give reasons in writing as to why this decision has been taken.
(c) The Business Case & Supporting Documentation
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A Community and Social Enterprise that seeks CPO acquisition and onward transfer by the Council will be asked to develop:
- A Full Business Case (FBC): information about the social enterprise (its track record,
current plans, partnerships and people, governance, legal structure); the Project (objectives, programme for delivery, proposed impact/benefits, management and operational arrangements and, where relevant, any capital construction works); the Market (the local need the project will respond to, beneficiaries, demand for the products/services to be supplied, customers, related provision in the local area, scope for collaboration/competition, pricing for rentals/services); Promotion (marketing strategy, methods, means); Resources (financial projections, 1yr cash-flow, 3-5yrs budget, profit/loss and capital expenditure plans, rationale); and, Risk Profile (assessment, management and mitigation strategy).
- Supporting Documentation: governing documents, evidence of external advice
solicited, expressions of support from partners/stakeholders and, where available, accounts.
(d) Indicative Time Scales
Time Frame Stage Responsibility
1 month Community and Social Enterprise submits a request in relation to a particular site – completing headline information about themselves, identifying the land or building(s) they propose to ask the Council to acquire, and providing a headline statement about their aims/objectives and the proposed uses of the site.
Community and Social Enterprise
2-6 months Request is referred to the Council’s Strategic Asset Management Group or its equivalent for endorsement. Once endorsed, the Lead Service (the Council service with most appropriate links to the organisation requesting the CPO) assumes the role of sponsor and co-ordinates the Council’s response to the request. Work may be needed to verify the credentials of the social enterprise, the possible likely value of the site and any compensation which will be payable, sources of funding for any CPO Indemnity, and to identify the owner and begin initial negotiations. These will clearly have to be site specific and so the length of this period may vary. Given the nature of the CPO process, the Council may ask the social enterprise to develop aspects of the Full Business Case (and perhaps begin applications for planning consent) during this period.
Community and Social Enterprise
1 month The Report to the relevant Cabinet Advisory Panel will detail relevant information which Councillors need in order to make an informed decision. This will include information about the social enterprise, the asset (value, repair, condition/suitability, and use), the likely cost of the CPO and the sources of funding to cover that cost, and the community benefit potential of the asset transfer (e.g. efficiency savings for the Council, opportunity to consolidate service provision within fewer buildings, increasing sustainability of the proposed recipient, etc).
Council
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Time Frame Stage Responsibility
The Panel’s decision (if support for the transfer is obtained) will be to resolve to acquire the site and to explore the use of compulsory purchase powers if these are needed. The resolution will define the land and state the purpose for which the land will be acquired.
6 months Community and Social Enterprise finalises the Full Business Case, maintaining regular contact with the Lead Service. The Council provides the information required to make the development process as straightforward as possible, and offers to review the emergent business case at regular intervals. If the Council is unable to acquire the site by agreement, the Council may also seek a further resolution to make a CPO order. The Council will then undertake the formal process of obtaining information about the site and the owners of it, and will then prepare the draft CPO Order.
Community and Social Enterprise / Council
2 months The Council is required to publicise the proposed making of the CPO Order, and then to allow a period for the submission of objections to the relevant Minister. If the Minister receives objections then the Minister may write to all parties to indicate that a public inquiry is to be held.
Council / Minister
6 months The Inquiry will be held to consider submissions from all parties and objectors. If there are no objections then an Inquiry will not be needed.
Council / Community and Social Enterprise / Minister
3 months The Inspector holding the enquiry will make a recommendation to the Minister, who will make the formal decision.
Inspector / Minister
3 months
If the CPO is confirmed, the Council may then take possession of the site using a number of different approaches or by agreement with the owners. There will then be the onward transfer to the Community Organisation if this has also been agreed by the Council.
Council / Community and Social Enterprise
(e) Assessment Criteria The Council will assess in each case whether there is a compelling case in the public interest for compulsory acquisition. As part of this consideration, the Council will consider:
- The value of the asset to the community - Any perceived threat to the asset - The future use of the asset and proposals as to any development and long term
management of the site - Any relevant planning issues - How the acquisition would be financed, including how the costs of the compensation paid
the owner and the Council’s own costs would be met.
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The Council will consider in each case whether additional information is needed, and will review each application on its merits.
