Agenda and minutes

There were no apologies for absence received.

The Leader reminded the Executive and members of the public of the housekeeping procedure rules.

(Please complete the enclosed form or telephone the Corporate and Community Services Unit to prepare a form for your signature before the meeting.  Interests must be re-declared when the item is called, and Councillors must leave the room if necessary).

There were no declarations of interest announced.

Report by Leader and Executive Team (attached).

The Executive considered a report by the Leader and Executive Team (circulated previously), the options and/or alternatives and other relevant facts set out in the report regarding  the Performance and Financial Management report for Quarter 3 of 2018/19.

The Accountancy Services Manager highlighted the following:

·         As at 31st December 2018, the latest forecast net expenditure was £12.239m, which was £0.019m over budget.  Details were shown in Appendix 1 and it was anticipated that the small variance could be reduced further throughout the remainder of the financial year.

·         The original budget for 2018/19 included a forecast to achieve £0.200m worth of salary vacancy savings. The current position forecasts this would be exceeded and vacancy savings of £0.225m would be achieved.

·         The “Recycle more” service changes were introduced on the 5^th June 2017; the take up of the new garden waste service had exceeded expectations, 2017/18 saw a total sign up of 17,320. This year’s income was expected to exceed last year’s total by 570 properties.

·         Within the overall £0.019m net budget deficit there were various cost pressures and one-off savings.  The budget pressures seen within waste and recycling service had not increased any further at the quarter 3 forecast. There had been a significant reduction in the forecast planning fee income of £0.159m due to a reduction in the larger applications received, which was in line with other authorities experiencing the same pressure. However it was forecast there would be additional Business Rates Retention income of £0.200m over and above the budgeted £1.252m Business Rates growth which had resulted in maintaining the net budget deficit at a similar level reported at quarter 2.

·         The Business Rate retention scheme was introduced in April 2013 which sees Billing authorities receive a ‘baseline’ funding but in addition they are exposed to the risks and rewards of retaining a proportion of the income collected.  This exposure was mitigated by participation in the Devon-wide pool that collates all of the Business Rate growth and decline and returns a share of the impact to each local authority. There had been an estimated one-off additional income from the 100% Business Rates Retention pilot for 2018/19 of £0.750m; this additional income had been earmarked into reserves as detailed in paragraph 4.1.6 of the report to help fund future projects.

·         At the 31^st December 2018 the total external borrowing was £1.250m.

·         The recommended level of general fund balance is 5%-10% of the council’s net revenue budget (£0.611m to £1.222m). The forecast general fund reserve at 31 March 2019 is £1.161m, which is a level of 9.5%.

·         “Appendix-2 Movement in Reserves & Balances” detailed the movements to and from earmarked reserves in 2018/19.

·         “Appendix-3 Executive Contingency Reserve” detailed the Executive Contingency Reserve movements and commitments. 

·         “Appendix-4 Capital Programme” detailed the 2018/19 to 2020/21 Capital Programme.  The Programme of £12.842m was funded by Capital Receipts (£2.349m), External Grants and Contributions (£8.964m) and Reserves (£1.529m).

·         Variations of (£2.254m) proposed to the 2018/19 Capital Programme as detailed in paragraph 4.4.3 of the  ...  view the full minutes text for item 100.

Report by Head of Operational Services (attached).

The Executive considered a report by the Head of Operational Services (circulated previously), the options and/or alternatives and other relevant facts set out in the report regarding the replacement of the Materials Recovery Facility infrastructure.

The Head of Operational Services highlighted the following:

·         All recyclable materials collected were brought to Brynsworthy Environment Centre for sorting.

·         The existing equipment in the process hall was often at maximum capacity to bale the collected materials. The equipment was old and regularly broke down or needed additional maintenance and was now in need of replacement.

·         Some of the equipment was over 10 years old. 

·         As a direct result of the Recycle More project in 2017, which included the trial of the three-weekly residual collection service, the amount of recycling now collected had increased significantly.

·         The Recycle More project had influenced residents to recycle more than ever before resulting in the existing facility used to process the recycled materials not being capable of keeping up with the throughput. The occurrence of breakdowns were approximately twice per week with more major breakdown being monthly. Breakdowns were not restricted to one particular component and there were regular problems with any one of the three existing balers, conveyors and ancillary equipment.

·         In 2007/08, baling was introduced.  The collection of mixed plastics was introduced in 2014.

·         From 2014/15 to 2018/19 the collection of plastics had increased by 103%.  The collection of aluminium had increased by 140% and steel had decreased by 34%.

·         The existing equipment in the process hall was designed to deal with 6 tonnes.  It now handled in excess of 6 tonnes and was unable to cope with the current level of materials that were processed.  For the first 9-months of the financial year breakdowns and the recovery of breakdowns had cost the authority £44,264.00 which had not been budgeted for.

·         A decision had not yet been taken in relation to the roll out of the  three-weekly trial to other areas or district wide.  If was extended the problem with the process hall would be further exacerbated.  If this decision was not taken there would still be a need for the Council to increase its level of recycling to 50/55%.

·         Alternative options available –

Report by Head of Resources (attached).

The Executive considered a report by the Head of Resources (circulated previously), the options and/or alternatives and other relevant facts set out in the report regarding  the review of Charges and Fees for Services 2019/20.

The Head of Resources highlighted the following:

·         This year the guidance was to increase some fees and charges by 3%, although some fees are set by statute and these will be set nationally.

·         Other variations to the 3% increase were set out in paragraphs 5.3 to 5.8 in the report.

·         Trade Waste charges have been reviewed and simplified to aid the customer’s understanding of the charging structure. Zones 1 and 2 have now been combined with a minimum increase of 5%, with schedule 2 and Recycling charges increasing by 10%. The Head of Operational Services had confirmed that with these price increases the service was still commercially competitive. (Appendix 3)

·         Land Charges fees have been set to recoup the cost of providing the service, without changing the current fees the land charges service was still budgeted to recover all the costs and break even. (Appendix 4)

·         There were minimal changes to the Environment Health fees, as the majority of these were set by statute or set to recover costs. The changes include, amendments to the animal licence fees. With Zoos and Dangerous Wild Animal Licences being under review. (Appendix 5)

·         Single Sports pitch hire increased by 14.2%. The significant increase was due to current charges for grass pitch hire being relatively cheap. Block hire had also been introduced but kept at the 18-19 prices to encourage customers to lock themselves into a block booking of at least 11 games. (Appendix 7)

·         The Pannier Market fees have been recommended to be increased by 3%.  It was proposed that the additional £6,000 received be earmarked to be spent on the Pannier Market.  (Appendix 8)

·         Garden Waste charges have not been increased for 2 years and it was proposed not to increase the fees for the third year running.  This would be reviewed in 2020/21. (Appendix 10).

·         The net changes in the charges were expected to result in £88,400 of additional income which have been included within the draft 2019/20 budget.

RECOMMENDED:

REASONS FOR RECOMMENDATIONS

Report by Chief Financial Officer (attached).

The Executive considered a report by the Chief Financial Officer (circulated previously), the options and/or alternatives and other relevant facts set out in the report regarding the Revenue Budget 2019/20, Capital Programme and Medium Term Financial Strategy 2019-2023.

The Head of Resources highlighted the following:

·         Government settlement December 2018.  The provisional 2019-20 settlement (including the Rural Services Delivery Grant) was £3.269m (Year 4).  In cash terms this was £363,000 less than 2018-19 (10% reduction) in line with the Medium Term Financial Plan.  75% Business Rate Pilot bid for Devon had been unsuccessful.  There were no new changes announced for the New Homes Bonus for 2019/20, however potential changes for 2020/21.   The Rural Services Delivery Grant matched the 2018/19 level.  Council Tax levels for District Councils could be increased by up to 3% or £5 whichever was higher.  The referendum in relation to Council Tax levels for Town and Parish Councils had been deferred.  The Government had awarded one off funding for Brexit over a 2 year period of £17,500 for 2018/19 and £17,500 for 2019/20.  This grant would be placed in an earmarked reserve.

·         Government settlement change in funding by class of Authority.  The Shire Districts and County Councils had received the largest reduction in funding from 2015/16 to 2019/20.

·         Medium Term Financial Plan (2018-22) approved by Council in February 2018 was based on a number of financial assumptions about the future which included funding from Central Government, retained Business Rates income and future Council Tax levels, cost pressures and savings plans and contributions to and from reserves (e.g. vehicle replacement).  The forecast budget gap from 2019/20 to 2021/22, as at February 2018 was outlined.

·         New Homes Bonus changes introduced in 2017. 

·         New Homes Bonus provisional level of funding to 2019/20.  The level of funding for 2018/19 was £1,313,520.  The Medium Term Financial Plan assumed £1.3m for 2019/20 therefore there was an additional £146,000.  £100,000 from the New Homes Bonus would be placed into a reserve for one off capital projects.

·         Business Rates Retention.  100% Business Rate Pilot had been accepted for Devon for 2018/19.  The pilot programme was for one year.  The estimated additional one-off business rates gain was £0.750m.  This gain had been placed into earmarked reserves 2018/19 for future year projects.  The Government had invited bids for 2019/20 pilots, however Devon had been unsuccessful and would revert back to the Devon Pool (50% scheme).

·         The 2019/20 Business Rate retention forecast was £1.690m.  The 2019/20 draft budget (above baseline funding) was £1.502m. 

·         Local Government Finance funding reforms which included: Spending Review for the period 2020/21; a review of relative needs and resources; Business Rates Retentions pilots, business rates baseline reset, Fair Funding review, New Homes Bonus review, Reforms to Local Government funding would change the level of resources available and have an impact on revenue budget; indicative allocations would be announced during the Autumn 2019.

·         Council Tax levels for 2018/19 Band D properties had been increased by £5.16 (equivalent to 2.99%).  Rural Councils could increase levels by up  ...  view the full minutes text for item 103.

Report by Chief Financial Officer (attached).

The Executive considered a report by the Chief Financial Officer (circulated previously), the options and/or alternatives and other relevant facts set out in the report regarding the Treasury Management Strategy Statement for 2019/20.

The Head of Resources highlighted the following:

·         The Council was required to receive and approve three reports each year which included: Prudential and treasury indicators and treasury strategy (first report), Mid Year Treasury Management report (second report) and an Annual Treasury report (third report).

·         The Council’s investment priorities were security of funds first, portfolio liquidity second and then yield, (return).

·         Proposed changes to the Treasury Management Strategy for 2019/20 as detailed in paragraph 5.1 of the report.

·         The Council had not engaged in any material commercial investments or non-treasury investments.

·         Capital expenditure and net financing need of capital expenditure for 2019/20.

·         The Council’s underlying need to borrowing as detailed in paragraph 6.2 of the report.

·         Borrowing requirements as detailed in paragraph 7 of the report.  The underlying need to borrow was increasing in 2019/20 year.

·         Investment and borrowing rates.  Borrowing rates would continue to be reviewed to avoid incurring higher borrowing costs in the future.  It was more cost effective to borrowing internally.  Investments were only made on a short term basis. 

·         The criteria for risk management was largely unchanged from last year.

·         The Council would adopt a low risk, immaterial, approach to non-treasury (commercial) investments in line with the investment categories and authorised limits set out in Appendix 2.

RECOMMENDED

REASONS FOR RECOMMENDATIONS

Report by Chief Financial Officer (attached).

The Executive considered a report by the Chief Financial Officer (circulated previously), the options and/or alternatives and other relevant facts set out in the report regarding the 10 Year Capital Strategy 2019-2029.

The Head of Resources highlighted the following:

·         In December 2017, the Chartered Institute of Public Finance and Accountancy, (CIPFA), issued revised Prudential and Treasury Management Codes stating that from 2019/20, all local authorities will be required to prepare a Capital Strategy.

·         The Strategy was required to provide a high-level overview of how capital expenditure, capital financing and treasury management activity contribute to the provision of services, an overview of how the associated risk is managed and the implications for future financial sustainability.

·         This capital strategy document covers the ten year period from 2019/20 to 2028/29 and will be reviewed annually by Full Council prior to each financial year.

·         The Strategy did not include the financial impact of the potential new Leisure Centre or potential addition spend on the Watersports Centre projects.

·         Capital Governance arrangements as detailed in paragraph 5.3 of the report.

·         The current Medium Term Financial Plan included borrowing costs for the Capital Programme approved earlier on agenda.

·         The Capital Strategy for years 2019/20 to 2022/23 (Medium Term) as detailed in paragraph 5.4 of the report.

·         The Capital Strategy for years 2023/24 to 2028/29 (Long Term) as detailed in paragraph 5.5 of the report.

·         Following the District Council elections in May 2019, there would be a need to undertake a review of the service spend and identify savings to reduce the budget gap (both Revenue and Capital).

·         Capital funding and affordability.  Projected external borrowing.  There was a need to challenge the future projects within the long-term capital expenditure to identify whether they were required or could be delayed.  If additional capital receipts were received, there would be a need to use the receipts to reduce the level of borrowing need.

·         Risks with the Capital Strategy as detailed in paragraph 5.6 of the report.

            RECOMMENDED

            REASONS FOR RECOMMENDATION

Councillor R. Cann left the meeting.

Report by Conservation Officer (attached).

The Executive considered a report by the Conservation Officer (circulated previously), the options and/or alternatives and other relevant facts set out in the report regarding an urgent works notice for Bunksland Farm, East Anstey.

The Conservation Officer circulated photographs of Bunksland Farm to the Executive which had been provided by the structural engineer.

The Conservation Officer highlighted the following:

·         Confirmed that the farm was located within the parish of East Anstey.

·         Bunksland Farm was a grade II* listed building dating from the late medieval period. It contained historic fabric and features of considerable significance. The farmhouse was in a very poor condition and had suffered some internal collapse. The ownership of the farm was not confirmed, therefore works required to prevent further deterioration of the building would not be undertaken, unless by a third party.

·         North Devon Council had the power to serve an Urgent Works Notice on the building, carry out the works in default, and ultimately reclaim the expenditure when ownership is established.

·         The farm had not been registered with the Land Registry and there were no deeds. 

·         The property had been vacant since 2009.

·         The Executors were in the process of trying to register the property with the Land Registry.

·         A charge would be placed on the property in order to recover the costs of the Council in undertaking the urgent works.

·         The Executors had received a valuation from Stags, who had given an estimation of between £475,000 to £500,000 for the farm and land.

In response to questions, the Head of Corporate and Community advised that in order to speed up the process of marketing the property once the works had been undertaken he suggested that recommendation 2.3 be amended to delete the wording “once ownership of the building is confirmed”.  If the property was not registered then the Council could become a mortgagee in  possession.

            DECISIONS

            REASONS FOR DECISIONS

Councillor Yabsley left the meeting.

Report by Estates Officer (attached).

The Executive considered a report by the Estates Officer (circulated previously), the options and/or alternatives and other relevant facts set out in the report regarding the Council’s freehold interest in numbers 2, 4 and 6 Wilder Road, Ilfracombe.

The Estates Officer highlighted the following:

·         North Devon Council owned the freehold interest in numbers 2, 4 and 6 Wilder Road, Ilfracombe which were let on long leases to Young Devon. The two properties are used as a shared house and hostel accommodation for young people.

·         Following a flash flood last year, it was established that there were serious repairs needed to the structure and exterior of numbers 4 and 6, which were suffering significantly from rising damp. The Council faced considerable costs in carrying out repairs.

·         The lease arrangements for the three properties.  The leases restricted the user to providing accommodation for young persons.  The Council had a duty to provide accommodation for young persons.  Access to such accommodation was a valuable resource.  There was limited control from a freehold perspective.  There was a planning restriction on the property.

·         Options available to the Council as detailed in paragraphs 4.2, 4.3 and 4.4 of the report.

DECISIONS

REASONS FOR DECISIONS

Report by Lead Officer, Food, Health and Safety (attached).

The Executive considered a report by the Lead Officer, Food, Health and Safety (circulated previously), the options and/or alternatives and other relevant facts set out in the report regarding the Service Plans for Food Safety and Health and Safety.

The Lead Officer, Food, Health and Safety highlighted the following:

·         It was a legal requirement of the Health and Safety Executive and the Food Standards Agency that the service plans were approved by Council.

·         The Plans covered a two year period for 2019/21.

·         Types of work that Environmental Health undertook.

RECOMMENDED

REASON FOR RECOMMENDATION