Agenda item

Matters Referred to Cabinet by the Overview and Scrutiny Committee

No matters have been referred from Overview and  Scrutiny at the time of publication of the agenda.

Minutes:

The Leader invited Councillor Wright to report on the outcome of the Special Overview and Scrutiny meeting which had considered the recommendation of a ‘preferred bidder to secure the future of Hornsey Town Hall’ following the call-in of this decision.

 

The Leader set out the process for considering the Overview& Scrutiny recommendations and reconsidering the Key decision on Hornsey Town Hall. Cabinet would first consider the recommendations of the Overview and Scrutiny Committee, set out in the second pack of papers, at page 4, and Councillor Strickland would provide a verbal response to the recommendations.

 

Given that the Key decision was previously agreed following consideration of the exempt information at the October meeting, and response to the Scrutiny recommendations did not require further reference to the exempt part of the report, Cabinet agreed to reconsider the Key decision on a preferred bidder to secure the future of Hornsey Town Hall, as part of this item, in the open part of the meeting.

 

After Cllr Strickland’s response to the recommendations, Cabinet would also refer to the petition which was handed in from the Hornsey Town Hall Appreciation Society at the October Cabinet meeting and then move to reconsideration of the Key decision which was contained in the minutes, agenda item 6, at section 88, page 15 of the original pack. Cabinet noted that the original Cabinet report recommending the decision was attached from page 27 of the second pack of papers.

 

Councillor Wright, Chair of Overview and Scrutiny, began presentation of his report and advised that the Overview and Scrutiny call -in meeting on the 8th of November, had been a long and thorough session lasting 4 hours which had considered two call-in’s. The Committee had given full consideration to the decision on Hornsey Town Hall and received representations from: the Hornsey Town Hall Appreciation Society, the call-in lead signatories and received a petition from Cllr Engert. The Chair of Overview and Scrutiny was also grateful for the Cabinet Member’s attendance and officer participation in the meeting.

 

The Overview and Scrutiny Committee had agreed that the decision did not fall outside the budget and policy framework and the most appropriate course of action was to refer the decision back to Cabinet to allow for full and detailed consideration. The Committee had agreed ten recommendations which were contained at page 4 in the second pack of papers to be considered and responded to along with original key decision.

 

Councillor Wright continued to outline the ten recommendations which were mainly concentrated on:  safeguarding free access to the square, affordable housing, tailored support for the businesses which have to move, immediate community engagement and involvement, safeguarding the community Arts centre use through the lease, active continual monitoring  of the lease, and high standard of design and accessibility.

 

Councillor Strickland thanked Scrutiny colleagues for their examination of the decision. There was misinformation circulated about proposals, prior to the Cabinet meeting, so the call-in Scrutiny meeting had been helpful in exploring the detail of the proposals and clarifying the issues which colleagues had concerns about.

 

Councillor Strickland continued to respond to the Overview and Scrutiny recommendations and the Cabinet noted the following:

 

Overview and Scrutiny Recommendation A - That the Cabinet consider imposing a legal covenant guaranteeing free public access to the square, running with the land in perpetuity

Councillor Strickland confirmed that the legal agreements would contain a tenant covenant to maintain public access to the Town Hall square. This corresponded with leasehold arrangements so even with the unlikely event of a future change in operator, this requirement would still apply and bind any future leaseholders. Any failure to comply with the leasehold arrangements, including any unreasonable daily non access to the square, would be a breach of the lease. Therefore the Council would be able to enforce the lease in the required legal way.

Overview and Scrutiny Recommendation B -   That the Cabinet Member explores in conversation with the preferred bidder increasing the amount of affordable housing offered on the site, noting that an increased level of affordable housing cannot be imposed;

Councillor Strickland advised that he would discuss this with the bidder, as agreed at the Scrutiny meeting. The preferred bidder understood the need and desire for new homes in the borough. 

The Cabinet Member stressed that if a new planning application was taken forward by the preferred bidder, then the issue on the number of affordable housing units would be a decision for the Planning Committee as this would not be in the Cabinet’s remit.

Overview and Scrutiny Recommendation C -  That the Cabinet Member for Housing, Regeneration and Planning continues to explore possible support from the Mayor of London for increasing the amount of affordable housing offered on the site;

Councillor Strickland advised that discussions would continue regarding grants for affordable housing with Mayor and he would continue discussing, with the Deputy Mayor for Housing, how assistance may be given and how this might work on this site.

Overview and Scrutiny Recommendation D  - That the Cabinet consider ring-fencing the capital receipt obtained from the transaction for affordable housing, or foregoing a proportion of any capital receipt in order to increase the amount of affordable housing offered on the site;

Councillor Strickland reminded colleagues that the capital receipt, to be received from developing the land at the rear of the Town Hall for housing, was helping finance the  scheme so the Council were not removing this capital receipt and it was retained within the scheme. Separate to this, there was a further capital receipt to be received by the Council and this would be dealt with as part of the agreed capital strategy which provides for General Fund capital receipts to be held for general capital purposes in order to provide funding for the delivery of the Council’s priorities. 

 

Overview and Scrutiny Recommendation E - That the Cabinet consider ring-fencing any overage monies to provide additional affordable housing;

Cllr Strickland provided a reminder that Overage is capital (not revenue). Also, as set out above, the Council’s Capital Strategy provides for  General Fund capital receipts to be held for general capital purposes in order to provide funding for the delivery of the Council’s priorities. 

 

As set out above - Individual requests for ring-fencing of capital receipts could not be made outside of the wider considerations of the application of capital funds at full Council.

 

Overview and Scrutiny Recommendation F  -  That the Cabinet consider offering a tailored package of support for businesses currently located at Hornsey Town Hall that will be displaced by the proposed development;

Councillor Strickland advised that the Council had always been clear that the businesses in the Town Hall were there on a temporary basis but recognised that a robust approach was required and committed to organise meetings with the SMEs in Hornsey Town Hall to understand their needs and discuss what level of support they required, Cllr Strickland agreed that the Council would actively seek alternative locations for the SMEs based inside Hornsey Town Hall. 

Overview and Scrutiny Recommendation G - Which the Cabinet ensure the community is engaged with as soon as possible after an agreement is made with the preferred bidder to ensure the community, can be as fully involved as possible. This engagement should not be delayed until the building is reopened;

Councillor Strickland agreed that early engagement was very important and residents would be involved as soon as possible in helping with shaping designs for the site. Councillor Strickland informed the Cabinet meeting that he had met with FEC and Co Plan representatives, since Overview & Scrutiny Committee and raised this issue with them. They were keen on this too and were starting work on a communications plan and community engagement plan. Councillor Strickland advised that they had reconfirmed commitment to a community hub and would have a staffed presence on site. The preferred bidder would also display progress and plans in this hub and this would be a place where the community can drop in to provide their feedback and communicate directly with representatives of the preferred bidder.

There would also be a community steering group to look at community uses and provide community governance. This would happen later in the process but the Cabinet Member was determined to work with the bidder to ensure this happened as soon as possible. The preferred bidder had confirmed that the community hub would be on site as soon as a decision was made.

Overview and Scrutiny Recommendation H  - That the Cabinet confirm in its negotiations on final terms with the preferred bidder how the community use of the building, including the arts centre, be ensured, particularly in mitigating against potential financial obstacles and the impact of shortfalls or assignment;

Councillor Strickland reiterated that an OJEU procurement process was chosen as it provided more control for the Council with freeholder protection over the long term, to ensure community use of the Town Hall. Also the legal agreements secured on-going community use of the building. Councillor Strickland re-iterated that the legal agreements were fully enforceable and this had also been confirmed through independent legal advice.

Overview and Scrutiny Recommendation I - That the Cabinet agree an active method of policing the lease and the use of the building. This could include a requirement for the Cabinet Member and officers to provide an update to Cabinet on the progress of the project, compliance with legal requirements, at least annually and in the event of any proposed material changes;

Councillor Strickland outlined that there would be regular meetings held with FEC, starting shortly, during the design, planning and construction phases to ensure consistency and progress in line with the commitments made and they are clear on this. There would be a legal/contractual relationship between the Council as landlord and FEC as the tenant. This would be ‘policed’ through this legal mechanism to enforce the lease where this is a concern and action can be taken.

Any major changes throughout the duration of their lease would require Landlord approval and/or planning approval (depending on the nature of the changes).  Significant check and balances in place regarding any change.

The Cabinet Member would be provided with regular updates and the bidder would provide regular programmed updates to the community. Once the Community Steering Group was established this would provide a place of accountability for the community.

Cllr Strickland could not agree to provide annual updates to Cabinet for the continuing 125 years of the lease as this would not really add any transparency to the process nor value.

The Community Steering Group would review the community activity in the building to ensure spaces were kept available and to ensure that these spaces were appealing to the needs of people both locally and beyond Haringey. 

Overview and Scrutiny Recommendation J  - That the Cabinet seek to ensure a high standard of design and accessibility in the development of the site, alongside compliance with planning requirements in respect of density, massing and height levels.

Councillor Strickland advised that FEC were appointing their design team and the Council would ensure accessibility was a key item on their agenda.

It was important to note that there was currently an existing implemented planning permission, which sets the precedent for the site and the quality of design, was controlled through planning. The existing consent had a DDA Statement, which looked to make the building accessible as much as possible. The Council would continue to raise this issue and if there were any further planning applications this would be looked at afresh and disability requirements would be met

Councillor Strickland thanked Councillor Wright for his comprehensive report and helpful recommendations.

 

Cllr Strickland then referred to the petition handed in at the October Cabinet meeting by the Hornsey Town Hall Appreciation Society which was also tabled. Cllr Strickland thanked the organisation for the petition and commented on the text which had sought signatures opposing the disposal of Hornsey Town Hall to a buyer ‘who wants to turn it into a luxury boutique hotel’ and  this was contrasted in the text against a rejected plan from Tischman's to create an Arts centre.  The Cabinet Member challenged this misinformation and referred to the public Cabinet report which made clear that a mixed use scheme was being taken forward, including full restoration of the dilapidated building, with a Hotel alongside an Arts Centre. It was hoped that this misrepresentation would now be resolved given the clarifications provided to the Overview and Scrutiny meeting and the Cabinet meetings. If the recommendation was approved, the preferred bidder aimed to start significant engagement with the community to support shaping the future for the Town Hall.

 

In response to Cllr Engert’s question, Cllr Strickland reiterated that community use and access to the hall, building, and square was guaranteed and there were legal agreements to enshrine this .Cllr Strickland also repeated that the bidder was keen to engage with the community and would have a number of community consultation events planned.

 

In response to Cllr Gideon Bull’s question, the Monitoring Officer advised that it was open to Cabinet to re- affirm the original decision, if this was the chosen way forward, and to take into account the comments already made by  Cllr Strickland in response to  the Scrutiny recommendations.

 

The Leader advised that the Cabinet minutes would record what was said in response to each of the ten recommendations. The Leader clarified  that a political and common sense approach was being taken forward in considering and responding to the Overview and Scrutiny recommendations whilst  re- considering the original Key decision.

 

In accordance with the Call in procedure, and having heard the responses to the Scrutiny recommendations, the Leader asked Cabinet to refer to the Key Decision which was contained in the Cabinet minutes at agenda item 6, at section 88, in the final paragraph at page 15 of the pack.

 

After re-considering the matter, Cabinet unanimously RESOLVED:

 

1.    To agree to the selection of Far East Consortium International Ltd as the preferred bidder for the HTH site (shown edged red on the plan included in Appendix A) based on the scoring set out in Appendix E and to enter into a Development Agreement for the HTH site  with either Far East Consortium International Ltd or a special purpose vehicle set up by Far East Consortium International Ltd and the grant of long leases with such appropriate tenants as agreed with FEC based on the main  terms set out in paragraph 6.27 of this report; and that delegated authority be given to the Director of Regeneration, Planning and Development after consultation with the Assistant Director of Corporate Governance to agree the final terms of the Development Agreement, long leases  and all associated legal agreements

 

2.    This was subject to further commitments made by Cllr Strickland in response to the Scrutiny recommendations.

 

 

Reasons for Decision

The Cabinet decision in April 2011 declared the site surplus to the Council’s requirements and agreed the principle for a partner to enter into a 125 year lease to operate the building, with the Council retaining the freehold.

 

The Listed building is on English Heritage’s Buildings At Risk Register therefore a solution is required to undertake restoration work to the building and the Council does not have funding available to undertake these works itself. 

 

Options Appraisal work identified that one developer for both the HTH site and building is a preferred approach as it secures both the restoration works and a long term operator for the building and is likely to bring the building back into use at the earliest opportunity. In addition to this a Developer would expect to have control over the works in the town hall as residential units cannot be occupied until essential heritage works have completed in the town hall because of the existing planning condition which links the two elements.

 

A public sector procurement of this scale must legally be governed by the public procurement regulations; therefore an OJEU process had to be carried out to secure a future for the dilapidating building. Professional advisors and the Council’s Legal & Procurement team advised that an OJEU compliant Competitive Dialogue process is the best way to achieve this outcome and this has been undertaken in accordance with the Public Contract Regulations 2015 (as amended) (“Regulations”).

 

To ensure the town hall building remains open and in use in the long term a partner, with a long term sustainable business plan needs to be appointed.

 

A timely decision on the future approach to the HTH project is required in order to engage with and exchange contracts with the bidder while they have a strong appetite to progress with the project, avoid further deterioration to the listed building, remove the ongoing liability of the building to the Council at the earliest opportunity and address the longstanding frustrations of the local community at the timeframe for securing a sustainable future for the Town Hall.

 

Alternative options considered

The alternative options that had been considered for the Hornsey Town Hall project can be defined as follows:

·         Option A - Do nothing: Without taking any action to secure a future use and developer/operator for the Town Hall the building condition will continue to deteriorate.  The Council remains responsible for the on-going liability for the building and any use of the building by the local community will be limited.

·         Option B - Conditional land sale: The Council could sell the HTH site via a conditional land sale agreement, however the Council would have limited control in this option to enable and enforce community access and use.

·         Option C - Freehold sale of the site: Sale of the site without retaining any interest would mean the Council is unable to secure community access and use as there are no lease mechanisms to enable this. The Council was not prepared to pursue an option that did not guarantee community access or provide the Council with enough control to ensure that Hornsey Town Hall can support community cohesion and economic dynamism in Crouch End.

·         Option D - Dispose of land at the rear and use receipt to refurbish the building:  In this scenario it is not expected that the land sale receipt would fully cover all the costs to refurbish and fit out the building for use, the Council’s on-going liability for running costs and maintenance is not removed and a sustainable operator and future use is not secured for the Town Hall.

 

 

Supporting documents: