AGENDA ITEM NO. 4(iii)

REPORT TO: / Executive Board
REPORT NO: / CEDO/08/04
DATE: / 20 April 2004
REPORTING OFFICER: / Chief Economic Development Officer
CONTACT OFFICERS: / Sarah Salisbury, URBAN II Programme Manager (01978 367934)
SUBJECT: / URBAN II Capital Programme
WARD: / West Wrexham – Coedpoeth, Brymbo and Tanyfron, Gwersyllt East, Gwersyllt North, Gwersyllt South

1.PURPOSE OF THE REPORT

To seek Member’s support for proposals generated through the URBAN II Programme to develop a network of community buildings in West Wrexham; to approve the allocation of LRF and Capital Receipts match funding and to give delegated authority for submission of funding bids.

2.INFORMATION

2.1.Policy Framework

The West Wrexham URBAN II Programme supports the Council’s draft Economic Development Department strategy 2004-2007.

The Council agreed to bid for funding for the URBAN II Programme in July 2000 (see report CEDO/28/00, Minute ref: 229). The URBAN II Programme is a European-funded Community Initiative Programme which focuses on two priorities: (1) Entrepreneurship and Business Development and (2) Participation.

2.2Budget

There is just under £7m grant in total awarded to the West Wrexham URBAN II Programme for projects under the Priorities of (1) Entrepreneurship and Business Development and (2) Participation.

Projects must secure a minimum of 50% of match funding from other sources in order to draw down the URBAN II grant.

The Welsh Assembly Government (WAG) has provisionally allocated £1,721,787 Local Regeneration Fund monies (LRF) to the Council to use as match funding to draw down URBAN II grant, of which £143,840 has been committed to the Llay Park Resource Centre and the Tanyfron School House projects (see report CEDO/08/02, Minute ref: 817). This leaves the provisional allocation available at £1,577,947. Furthermore the Council’s Executive Board resolved on 13 May 2003 to commit £1m from the Council’s Economic Development Department Capital Receipts as match funding towards the URBAN II programme (see report CEDO/08/03, Minute ref: 550).

Both the LRF and URBAN II funding have annual spend targets to be achieved; failure to do so would result in the loss of funding for West Wrexham.

To date three of six facilities endorsed by the Council’s Executive Board as part of the West Wrexham Capital Strategy for a network of community based learning/enterprise facilities have received URBAN II funding (see report CEDO/08/02, Minute ref: 817). These facilities are the Brynteg Lifelong learning Centre, the Llay Park Resources Centre and the Tanyfron School House. A progress report was submitted to the Executive Board on 18 November 2003 (see report CEDO/25/03).

This report seeks Members’ approval to use the match funding secured to draw down the URBAN II grant in order to implement the three remaining projects prioritised within the West Wrexham Capital Strategy with the required timescales for the funding.

Each project within the Capital Strategy will have an individual business plan, identifying the long-term revenue income for the facilities in order to ensure the viability of each centre in the long-term. To date, the Council has been the lead/accountable partner for the Brynteg and Llay Centres whilst the Tanyfron School House Committee, a local management committee is accountable for the Tanyfron School House project.

Of the remaining three projects, it is currently anticipated that the Council will be the lead/accountable partner for the proposed Coedpoeth project, which will be led, by the Leisure, Libraries and Culture Department. The business plan setting out the possible on-going liabilities for this project will be submitted to the Executive Board for consideration at a future date prior to committing to the project. It is anticipated that the direct accountability for the remaining two projects would rest with the Gwersyllt and Brymbo and Tanyfron URBAN II committees respectively.

The certainty of long-term revenue funding and viability will in any event form part of the formal grant approval process, for which it will be necessary for business plans to be worked up. At this stage Members are being asked to endorse the use of ring-fenced LRF and WCBC Capital Receipts allocations in whatever combination required enabling project applications to go forward to the application stage. A final decision to proceed with a project will only be taken in the light of the outcome of the application process and the long-term sustainability of the project as demonstrated in the business plan.

2.3Consultation

The URBAN II Programme is a Community Initiative Programme with the development, empowerment and involvement of the local community integral to its success. Five Community Committees reflecting the five Community Council areas and a West Wrexham Business Forum have been established to steer the development and implementation of the Programme. Members from these areas are represented on the West Wrexham Partnership Board/Programme Monitoring Committee (WWPB/PMC). Furthermore, each Community Committee is fully engaged within the development of individual elements within the Capital Strategy.

The WWPB/PMC, in May 2002, approved the prioritised action and targeted activity to develop a network of community based learning/enterprise facilities to accommodate a variety of activities. This was originally identified through an audit of need resulting in the West Wrexham URBAN II Action Plan.

In order to identify areas of prioritised action to be addressed through URBAN II Programme, a thorough audit of need was carried out gaining the views of local residents, employers and young people aged 11-16 in West Wrexham. The results of each of these audits has been used by the five URBAN II Community Committees to formulate their ‘Community Action Plans’. In addition, to maintain a strategic overview, a ‘West Wrexham Action Plan’ has been developed setting out eight key objectives to be addressed through the lifetime of the Programme.

2.4Further Information

A proposed strategy for the development of a network of community based facilities developed in response to the West Wrexham Action Plan was submitted to the Executive Board meeting 16April 2002 (CEDO/08/02, Minute ref: 817).

Members resolved to endorse the principle of the network of community buildings across the West Wrexham URBAN II area. Of the original proposal three facilities have now secured URBAN II funding (Brynteg, Llay and Tan y Fron) and the Executive Board considered a progress update on 18 November 2003 (see report CEDO/25/03, Minute ref: 260). At the time of submitting the evolving strategy, a further three facilities were at an early stage. Further development has taken place on the original concept and the following provides the more detailed proposal.

i)The Gwersyllt Community Committee, together with the Gwersyllt Partnership Board has been working with Council Officers to develop a scheme to refurbish the Old Surgery, First Avenue, Gwersyllt, to provide a Gwersyllt Community Resource Centre. Facilities are to include: Youth and Community facilities, I.T. training, office suites, playgroup and meeting rooms. The Business Plan is nearing completion and plans have been drawn up for the refurbishment. The initial project cost (for a 3 year period, 2004 - 2007) including capital and revenue is approximately £1.1m. An element of match funding has been secured, however, a further amount in the region of £440,000 LRF is required in order to implement the scheme. Ongoing income generation from rental of space for training, office accommodation and childcare provision within the building will assist in funding the revenue costs in the longer term.

ii) The Coedpoeth Community Committee has been working with the Council’s Leisure, Libraries & Culture Department in developing a viable business plan for a lifelong learning/business centre in Coedpoeth. The concept for the centre includes: Business Units for ongoing rental/sessional use, nursery facilities, I.T. learning suite, lifelong learning facilities, meeting space for community use. Ongoing income generation from the business units and nursery in the longer term will assist in funding the revenue costs. The Leisure, Libraries & Culture Department has also indicated its support as lead/accountable body for this project subject to evidence of viability.

An option appraisal was undertaken to identify a venue within the village at which to take forward this proposal. The current Penygelli Junior School, Coedpoeth was identified as the most suitable venue to be due to lack of appropriate facilities elsewhere and this was approved by the Coedpoeth Community Committee. The development of this building however, is dependent upon funding being confirmed to build the proposed new Penygelli Junior School, therefore releasing the current building to be used for community purposes. This will be subject to a separate report from the Education Department to the Executive Board after April 2004. The indicative project cost is potentially £1.7m, which requires approximately 50% in match funding. It is proposed that this project be supported by URBAN II from 2006 - 2008.

iii) The Brymbo and Tanyfron Community Committee initially supported an investigation into the development of the Powerhouse Building on the former Brymbo Steelworks site as the preferred location for a community enterprise centre. The Executive Board resolved at its meeting on 13 May 2003 to support this proposal (CEDO/08/03, Minute ref: 550). Consultants were commissioned to investigate the feasibility of an enterprise centre on this site, however, the results of this study could not support a viable business plan due to a variety of factors including the size of the proposed Powerhouse building and associated revenue requirements and the impact and timescales of the reclamation works on the former steelworks site. A summary of this report is included as Appendix 1.

Following an extensive site search, the Chief Economic development Officer recently sought the approval of the chair and Vice-Chair of the Executive Board to use delegated powers, (CEDO 3) to acquire an ideal property for the development of a community facility which is the Old St Mary’s Building, High Street, Brymbo; in the short term, with a view to including this within an URBAN II application to develop a learning/enterprise centre on production of a suitable Business Plan. This is the second preferred option of the Brymbo and Tanyfron URBAN II Community Committee due to its central location and the potential for refurbishment and/or expansion. An initial condition survey of the property has been undertaken and the anticipated project cost for a 3 year period (2004 – 2007) including both capital and revenue requirements is up to £2m, therefore it is anticipated that £1million in match funding is required.

With the Council’s £1million contribution and Local Regeneration Fund allocation to the URBAN II Programme currently totalling £1,721,787 it is envisaged that this should be sufficient match funding for the remaining projects prioritised within the Capital Strategy.

However, the level of LRF available for the URBAN II Programme has been under review by WAG. No further confirmation on changes to available funding has been received, thus the annual spend targets have yet to be confirmed resulting in the need to be flexible in the use of match funding. This is particularly pertinent given that failure to meet both the annual spend targets for both the URBAN II Programmes and LRF would result in the loss of funding for West Wrexham.

It should be noted, however, that the capital strategy is reliant on securing URBAN II grant. Therefore, failure to secure sufficient grant funding (including the match funding requirement) will result in a project not progressing to the ERDF grant application stage or a revision/reduction of a the original project to be implemented within the available budget. As the timescales for these projects are at intervals across the remaining life of the URBAN II Programme (2004-2008) this will allow opportunity to source additional match funding if necessary.

Therefore it is proposed that the three centres should be funded as follows:

Facility
/ Timescales / Estimated Project Cost
(capital & revenue) / Estimated match funding required from LRF and capital receipts
Gwersyllt / 2004-2007 / £1,100,000 / £440,000
Brymbo / 2004-2007 / £2,000,000 / £1,000,000
Coedpoeth / 2006-2008 / £1,757,000 / £878,500

The project cost and match funding required are indicative figures only at this stage and may be subject to change during the process of developing the detailed ERDF application required to access URBAN II funding. Changes may be due to:

i)refinement of costs in further development of the URBAN II project and ERDF application;

ii) above inflationary increase for building costs between the development of the business plans and development of the ERDF application, particularly relevant to projects in future years; and

iii) further match funding secured by project applicants.

It should be noted that all ERDF applications for URBAN II funding are subject to a thorough appraisal process undertaken by the Welsh European Funding Office in its role as managing authority before the grant is approved. This appraisal includes consideration of detailed financial breakdowns (which for large scale capital projects may be undertaken by architects employed by WAG), timescales, long-term revenue funding and viability. Projects, which do not satisfy the stringent criteria established by WEFO will not secure, grant funding.

3.RECOMMENDATION

Members are recommended to agree to:

i)ratify the decision by the Chief Economic Development Officer following consultation with the Chair and Vice-Chair of the Executive Board to try and acquire the former St. Mary’s School House or a suitable alternative for the purpose of using the land and buildings for the Brymbo Learning/Enterprise Centre project;

ii)approve the flexible use of Local Regeneration Fund and Capital Receipts allocated for the URBAN II Programme to match fund the remaining three facilities within the URBAN II capital strategy ;

iii)approve the use of rental income generated in each of the centres to support the on-going revenue costs of the centres; and

iv)approve the submission of a project application for the Coedpoeth Learning Centre to the URBAN II Programme by the Chief Leisure, Libraries and Culture Officer subject to the submission of a detailed business plan detailing long-term viability to the Executive Board.

4.0REASONS FOR THE RECOMMENDATIONS

i) ratify the delegated decision of the Chief Economic Development officer to acquire the property and to use it for the Brymbo Learning/Enterprise centre project;

ii)to enable the West Wrexham URBAN II capital strategy to be fully implemented;

iii)to support the on-going revenue costs of the centres; and

iv)to support the submission of an URBAN II project application for the Coedpoeth centre by the Chief Leisure, Libraries and Culture Office.

5.0BACKGROUND PAPERS

West Wrexham URBAN II Local Action Plan

West Wrexham URBAN II Mid Term Evaluation

6.0WEBSITE INFORMATION

None

Appendix 1

SUMMARY OF REPORT SUPPLIED BY COMMUNITY ACTION

NETWORK (CAN) ON THE POWERHOUSE BUILDING, FORMER

BRYMBO STEELWORKS SITE.

Introduction

CAN were appointed as consultants and were given a brief to:

i)To develop a plan for a community-based facility to promote, develop and accommodate a variety of training and enterprise activities (with consideration to the prepared feasibility study produced by Broadway Malyan and the outline Business Plan/concept developed by the Brymbo and Tanyfron URBAN 11 Community Committee.); and

ii)To produce a viable and sustainable Business Plan within the parameters of the EU West Wrexham URBAN II Programme.

The use of the Powerhouse building, on the former Steelworks site, was identified as a possible “Regional Social Enterprise centre of Excellence”. CAN’s remit was to assess and report upon the following which they did in July 2003:

  • services/facilities/activities;
  • fostering an entrepreneurial culture in this process;
  • beneficiaries (i.e. potential entrepreneurs, local residents);
  • meeting objectives of the URBAN II Programme;
  • partner involvement (i.e. strategic/delivery/funding);
  • funding and maintenance of the centre;
  • project management;
  • links to other activities (Brymbo and West Wrexham);
  • links and support to develop other activities within the surrounding heritage area;
  • long-term sustainability and promotion/development as a Regional Centre of Excellence for Social Enterprise.

Consultation involved the following methods: Questionnaire survey; Consultation with Brymbo Community Committee; Fun Day; Community Needs Survey undertaken by Newidiem; Youth Survey undertaken by WCBC; Data supplied by Wrexham Enterprise to Broadway Malyan; URBAN reports and documentation

Findings

The main finding of the report was that, as a prospective social enterprise in its own right, the centre will need to survive by offering a clear, high quality service offering value for money to its paying customers (whatever the actual end use). The building therefore needs a high degree of flexibility worked into its fabric, which will in turn afford its managers some flexibility when marketing. The building should be able to offer a home for anything from small start up operations to call centres.

The building requires an income to avoid being subsidised by public monies, therefore it will have to charge commercial rents. Every usable space sq ft of the building (approx. 13,000 sq ft) has to contribute towards income.

The only potential viability of the Powerhouse was if it could attract the private sector to start up businesses within the building that would help subsidise the community aspect.

Other findings and recommendations from the report showed:

  • there is a genuine need for some kind of Enterprise facility within the Brymbo and Tanyfron area;
  • a proactive process of focused local inward investment opportunities should be developed through the provision of new incubator facilities in the community of Brymbo and Tanyfron.
  • in terms of enterprise/community regeneration activities, some potential seems to exist for the creation of some kind of cluster. This would however have to happen by the proactive consolidation of existing “third sector” projects
  • the social enterprise cluster can act as the base for any proposed community transport project established by the URBAN II team
  • the social enterprise cluster can act as the mentor for a proposed West Wrexham local community regeneration/social enterprise agency established to manage the building.
  • the powerhouse building could be transferred to the ownership of the proposed West Wrexham local community regeneration/social enterprise agency.
  • because of the low base it is essential that a sense of social well being is reintroduced into the community, bringing with it an improvement of facilities, work and social activity.
  • the building will need regular income on a regular basis, which in turn places the issue of community type facilities in this building at a due to the building being located in a fairly peripheral location. Community facilities are best located in the heart of a community.

Conclusion