To consider an options report, interim funding request and update.
The Cabinet had before it a *report of the Chief Executive and a further report of the Acting Managing Director of 3 Rivers Developments Limited providing the monthly update report and a summary of the options explored regarding the future direction of the company and to consider an interim funding request made by the company.
The Cabinet Member for Housing and Property Services answering a question posed in public question time stated that at the inception of the company the Council decided to structure it’s property company as a non-Teckal one so that it would not need to be bound by the standard public sector procurement rules. The operational opportunity cost of this decision meant that the Council could not gift work streams to its own company. However, if (as was legally permissible) it set up an additional Teckal subsidiary this would then be acceptable legally (subject to certain rules). The benefit of this was two-fold, the Council then had a reliable/known developer who could move forward more quickly with developments and the company had a wider portfolio of developments in order to spread risk over.
Cllr B A Moore moved, seconded by Cllr R B Evans that the meeting go into private session to consider an update with regard to the company and to consider a funding request
Therefore under Section 100A(4) of the Local Government Act 1972 the public be excluded from the next item of business on the grounds that it involves the likely disclosure of exempt information as defined in paragraph 3 respectively of Part 1 of Schedule 12A of the Act, namely information relating to the financial or business affairs of any particular person (including the authority holding that information).
Upon a vote being take, this was AGREED.
Following consideration of the recommendations within the report, the meeting returned to open session and
a) the update from 3 Rivers Developments Ltd be noted;
b) the funding request for £1.41m, in accordance with the approved capital programme be approved, subject to these (and all subsequent) transactions utilising the newly-commissioned loan agreement templates.
c) the proposed expenditure to secure legal advice on exploring the advantages and disadvantages of new governance arrangements to include a holding company and Teckal-compliant subsidiary, in order to deliver the most benefits for Mid Devon be agreed. This advice to be brought back to Cabinet as soon as practicable for future consideration.
(Proposed by Cllr B A Moore and seconded by Cllr R B Evans)
Reason for the decision: to provide interim funding for 3 Rivers Developments Limited to enable it to continue its operations and work on specified projects in advance of the submission and consideration of a new business plan in February/March 2021. Further, to approve the funding of legal advice on the advantages and disadvantages of setting up a Teckal subsidiary.
Note: *Report previously circulated.