Agenda, decisions and minutes

There were no declarations of members' interests.

There were no apologies for absence.

The decision relating to the report entitled " Sale and leaseback - White Hart Road " is a Key Decision for the purposes of the Forward Plan as defined in Article 13 of the Constitution but was not included in the Forward Plan for the period from 26 October 2016 until 31 January 2017 and is therefore an omission from the Forward Plan. Article 13 defines a Key decision as an Executive decision which is likely to:

 result in the Council incurring expenditure or the making of savings which are significant having regard to the local authority's budget for the service or function to which the decision relates, or

 be significant in terms of its effects on communities living or working in an area comprising 2 or more wards in the city's administrative area.

The Chair of the City Council's Scrutiny Management Panel has been notified of and agreed to the decision being made, in accordance with the City Council's Constitution (General Exceptions, Section 15) and (Special Urgency, Section 16).

As the decision must be taken by such a date that it is impracticable to defer the decision until it has been included in the next forward plan, this decision will not be subject to call-in.  Neither has it been possible in view of the urgency to meet the usual notice period provisions.

The "Sale and Leaseback - White Hart Road" report (by the Property & Investment Manager) explains that an urgent decision is required to enable a clear and timely dialogue with the market.

The Forward Plan omission was noted. 

The Chair of the Scrutiny Management Panel had been notified and agreed that the decision is being made in accordance with the City Council's Constitution (Access to Information Procedure Rules, Rule 15) and (Special Urgency), Section 16). As urgent action had to be taken to enable a clear and timely dialogue with the market, it was impracticable to defer the decision until it had been included in the next forward plan and it was not possible in view of the urgency to meet the usual notice period provisions.  It was also noted that the decision would not therefore be subject to call-in.

The purpose of the report is to update members as to the envisaged terms of the proposed 'sale and leaseback' transaction as detailed in the Cabinet report 22^nd September 2016.

RECOMMENDATIONS

2.1             That the Leader of the Council with responsibilities for PRED authorises

i.              The Council to grant a new headlease  and leaseback in land on White Hart Road, Portsmouth, the term of the headlease to be up to 150 years with a break in favour of the Council as freeholder, operable on expiry of the Wightlink occupational lease;

ii.            Delegated authority to be given to the Director of Property and the Director of Finance & Section 151 Officer, taking advice from the City Solicitor, and in consultation with the Leader of the City Council, to approve the completion of disposal in i. above.

DECISION: the Leader of the Council with responsibilities for PRED authorised

i.              The Council to grant a new headlease  and leaseback in land on White Hart Road, Portsmouth, the term of the headlease to be up to 150 years with a break in favour of the Council as freeholder, operable on expiry of the Wightlink occupational lease;

ii.            Delegated authority to be given to the Director of Property and the Director of Finance & Section 151 Officer, taking advice from the City Solicitor, and in consultation with the Leader of the City Council, to approve the completion of disposal in i. above.

(TAKE IN REPORT)

The Leader of the Council with responsibilities for PRED, Councillor Donna Jones,  welcomed everyone to the meeting and invited Mr Jerry Brown to make his deputation which he then did. Councillor Jones thanked Mr Brown for his deputation and said that she expected the matters raised to be clarified during the course of the meeting.

Tom Southall, then introduced the report  which updated members as to the envisaged terms of the proposed sale and leaseback transaction as detailed in the Cabinet report of 22 September 2016.

Since then officers had marketed the sale and leaseback proposal (the sale of the income strip) and feedback received was that there was an opportunity to further increase the capital receipt receivable by the Council if a longer term leasehold interest were created.

Mr Southall said that the first point raised in the deputation basically queried what the benefit to the purchaser would be in paying the extra money and expressed concerns about a clause enabling the purchaser to take away the lease back to PCC under certain circumstances.  He said in answer to this that it was important to give certainty to the purchaser going forward.  Enough legal protection would be included in the contract to ensure that there was no significant risk to the Council by extending the lease.  He explained the break clause option would be in favour of Portsmouth as set out in 3.6 of the report.

Councillor Jones added that essentially the purchaser is buying potential for income beyond 41 years.  PCC was a solid low risk entity and was probably regarded as being a safe pair of hands.  Concerning the point about the future use of the land being at the disposition of the purchaser, the current situation is that PCC is the freeholder and as such would have a veto on any development proposed by the lessee (additional to Planning Permission.)

With regard to the Arms- Length Property Company, Ravelin, Councillor Jones said  no decision had yet been taken about using this company and there is no current expectation to do so in this connection.  It is an option but if this needed to be used in the future, it would involve agreement by a minimum of three directors and a councillor and care would have to be exercised to ensure there was no conflict of interest.  However, this is not the intention at present.

With regard to the point raised about the exempt appendices not being available to members of the public, Mr Southall said that the appendices detailed options but not financial information.  He said there is a requirement to report annually on activity in the investment fund. 

With regard to the point raised in the deputation concerning financial incentives for individual officers, Councillor Jones said there were no financial incentives and elected members would be involved in any event.

With regard to exempt documents,  Councillor Jones said that figures could not be made public as negotiations had not been concluded.  ...  view the full minutes text for item 28.