Agenda item

COUNCIL COMPANIES FUNDING

Decision:

RESOLVED: That the contents of the report setting out (i) the advice of Grant Thornton, PS Tax, Link Group Treasury Services and Ensor Accountants relating to the structure options for financial support to WNPL and WNHC (the Companies), and (ii) the Council’s current analysis as regards the best options be noted;

2) That a Drawdown facility be offered to the Companies (comprising a mix of loan facilities and repayable grant agreements, and which may include debt-equity arrangements and/or the extension of current lease arrangements), with an overall lending cap of £50 million;

3) That delegated authority be given to the Executive Director (Place), in consultation with the Portfolio Holder for Business, the Share Holder Committee, the Section 151 Officer and the Monitoring Officer, to agree the final terms of the Drawdown facility with the Companies.

RECOMMENDED: 4) That delegated authority be granted to the Section 151 Officer in consultation with the Portfolio Holder for Business to amend the Capital Strategy for 2023-2024 to reflect the approved Drawdown facility to the Companies.

Reason for Decision

1. To deliver on Council Corporate Objectives:

· Promote growth and prosperity to benefit West Norfolk;

· Protect our environment;

· Efficient and effective delivery of our services; and,

· Support our communities.

To deliver affordable and private rented housing for acquisition by the council’s wholly owned housing companies to support the delivery of council corporate objectives

Minutes:

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Assistant Director David Ousby presented a report which brought together the advice the council had received from legal, financial and tax advisors on the funding of the council housing companies. It set out:

1. The total amount of borrowing available that the council could provide to support the housing companies, and the details of the funding agreements between the council and the companies.

2. the financing arrangements for West Norfolk Housing Company Limited (WNHC), which expired in March 2023, to allow that company to continue to purchase properties, both from the councils Major Housing Programme (MHP) and elsewhere.

3. the options available to the council to allow West Norfolk Property Limited (WNPL) to manage the private rented (PRS) properties in its portfolio, and the future pipeline of properties being delivered through the councils Major Housing Programme (MHP), through a hybrid debt plus equity financing and lease extension provision

The report and its recommendations had been reviewed by external consultants Grant Thornton. Their findings had been incorporated in the report to Cabinet.

Under standing order 34 Councillor Kemp asked if the council was safeguarding its loans against Council’s companies as there were only a small number registered against West Norfolk Housing and none against West Norfolk Property. The Monitoring Officer confirmed they were aware of the issue with the charges where there were some errors in the documents meaning the amendments had to go through the courts for amendments.

Councillor Beales acknowledged there was a lot of work to be done with the Companies which was all part of the proposals.

Councillor Parish acknowledged there were now sufficient staff in the Legal Department to help with the work.

Under standing order 34 Councillor Dark drew attention to the suggestion made at the Corporate Performance Panel that the Shareholder Committee be involved in agreeing the final terms of the Drawdown facility with the companies.

Cabinet agreed to the amendment. Cabinet discussed the issue of whether it needed to progress to an exempt session to further consider the exempt appendices, it was agreed that members were very familiar with the appendices so would not need to exclude the press and public, and the detail of them would be further considered in detail by the Shareholder Committee.