Agenda item

            The Committee considered the undernoted report:

 

“1        Relevant Background Information

 

1.1       The council incurs capital expenditure and capital financing costs in the delivery of its capital programme.

 

            Capital Expenditure is the expenditure incurred in the actual delivery of contracts, for example, the actual payments to the contractor for a construction contract. 

 

            Capital Financing is the method the council uses to fund the capital expenditure. The capital financing costs include loan repayments (principle and interest) and revenue contributions (cash payments to repay or avoid taking out loans).

 

1.2       At its meeting on 20 January 2012, the Strategic Policy and Resources Committee (SP&R) approved a capital financing budget of £10.14m for inclusion in the 2012/13 revenue estimates.

 

1.3       The £10.14m budget was set at a level which would meet the financing costs arising from the capital programme in 2012/13 - 2014/15, as part of investment programme, without the requirement for an increase in the District Rate.

 

1.4       The delivery of the capital programme element of the investment programme will be matched by a phased increase in capital financing charges up to the £10.14m budget over the life of the programme as all schemes within the programme are financed.

 

1.5       The phased impact of the capital programme on the capital financing budget provides the opportunity for the council to allocate an element of the 2012/13 capital financing budget to finance feasibility works and non recurring schemes.

 

1.6       This report presents the proposed 2012/13 capital programme together with a list of other emerging projects which it is recommended should be progressed to outline business case stage for further consideration.

 

2          Key Issues

 

2.1       The capital programme is structured in two parts as follows:-

 

·     Committed Projects (List circulated) - These are projects where approval has already been obtained by SP&R to proceed to tender. These projects will therefore be at the tender award, contract or construction stage.

 

·     Uncommitted Projects (List circulated) - These are projects where initial proposals have been considered by Committee and work on the project is being progressed, but they have not yet been developed to a stage where permission could be sought from SP&R to proceed to tender. (Approval to move to tender stage is sought for each scheme on an individual basis during the year, at which stage the projects moves into the ‘Committed’ section of the capital programme.) 

 

            In addition to the committed and uncommitted projects, other ‘emerging projects’ have been proposed through the investment programme consultation process and through the area working groups.

 

·        Emerging Projects (Appendix C) - These are proposals which could become uncommitted projects within the capital programme, but which require completion of a Strategic Outline Case (SOC) before they could be considered further. Approval of this list of proposed projects by SP&R is required before work on the SOC’s to commence.

 

            The three SP&R approval stages for the progression of projects from initial proposals to committed projects is summarised in table 1 below.

 

Table 1

SP&R Approval Stages for Projects

 

Stage	Description
1.	Emerging Projects: Approval of SP&R is required to enable a Strategic Outline Case (SOC) to be prepared for a project proposal.
2.	Uncommitted Projects: Once an SOC has been prepared, SP&R approval is required to commence work on progressing the project to tender ready stage.
3.	Committed Projects: Once the design phase of a project has been completed and the tender documentation has been prepared, approval of SP&R is required to enable the tender process to commence after which the contract will be awarded under delegated authority.

 

2.2       Given the complexity of this process it is recommended that a 2 hour briefing session be arranged for Party Group Leaders and the Chairs of the Standing Committees to further discuss the detail of the capital programme and capital financing arrangements.

 

2.3       As referred to in the background information, the incremental nature of the investment programme means that there is the opportunity for the council to ring fence part of the capital financing budget to provide a Feasibility Fund.

 

2.4       The Feasibility Fund would enable initial feasibility work to be undertaken on proposed projects to bring them to a point where Members can decide if they should be progressed as Capital Schemes, Local Investment Fund (LIF) schemes or City Investment Fund (CIF) schemes. It is recommended that the contribution to the feasibility fund for 2012/13 be capped at £500k.

 

2.5       The incremental nature of capital expenditure arising from the investment programme also provides the opportunity, during 2012/13, to finance a programme of Non Recurring Projects. The amount of funding available to fund the completion of non recurring projects during 2012/13 is approximately £1.8m, although in year slippage in capital programme could free up additional finance for non recurring projects.

 

2.6       Table 2 below summarised the proposed allocation of the capital financing budget for 2012/13, including the allocation for feasibility work and the amount available for non recurring projects.

 

Table 2

Potential Allocation of Capital Financing Budget for 2012/13

 

Recurring Financing Costs of Existing Loans (City Hall Works, Ulster Hall and Waste Transfer Station)	£2,051,600
Financing Cost of Committed Schemes (List circulated)	£3,031,200
Financing Costs of Uncommitted Schemes (List circulated))	£2,719,600
Feasibility Work (maximum expenditure)	£500,000
Funding Available for Non Recurring Schemes	£1,837,600
Total Capital Financing Budget	£10,140,000

 

            The following sections in this report provide information on the capital programme, emerging projects and non recurring projects for 2012/13.     

 

3          Capital Programme 2012/13

 

3.1       Committed Projects (List circulated)

 

            This provides the detail of committed projects already included in the capital programme.

 

3.2       Uncommitted Projects (List circulated))

 

            This provides the details of uncommitted projects already included in the capital programme. It is proposed that the following three projects are also included in the uncommitted section of the programme:-

 

·        Urban Broadband

·        ICT Projects: These are priority projects which will improve information management, security of data, our mobile infrastructure as well as support service improvements and the efficiency programme.

·        Vehicles (2012/13): This is the capital expenditure on replacement vehicles for the council’s fleet in line with the recommendations of the Value for Money review of the management and operation of the council’s fleet.

 

3.3       Emerging Projects (Appendix C)

 

            This list details the potential capital projects raised through the political process for which it is recommended that a Strategic Outline Case (SOC) be completed. Completion of the SOC, including the estimated costs of the project, will enable the prioritisation of these emerging projects and recommendations as to which projects should be moved to the uncommitted stage.

 

3.4       Non Recurring Projects (Appendix D)

 

            This funding will facilitate a programme of works, including improvements to council facilities. It would be a condition of any funded scheme that there will be no recurring expenditure associated with the works.

 

4.0       Recommendations

 

4.1       Members are asked to approve the following recommendations:

 

·        That the following projects are added to the uncommitted schemes within the 2012/13 capital programme:-

o   Urban Broadband

o   ICT Projects

o   Vehicles

·        That an amount of up to £500,000 from the capital financing budget be allocated to a Feasibility Fund for the completion of initial feasibility work for proposed Capital Programme, Local Investment Fund (LIF) or City Investment Fund (CIF) projects to bring them to a point where members can decide if they should be progressed as a Capital, LIF or CIF project within either of these programmes.  

·        That the emerging projects listed on Appendix C be progressed to Strategic Outline Case stage.

·        That the balance of capital financing budget for 2012/13 be allocated for the funding of non recurring projects, with initial funding provided for the non recurring works included in appendix D.

·        That a briefing be arranged for Party Group Leaders and Chairs of Standing Committees to enable detailed discussion of the capital programme and the capital financing arrangements.

 

5.0       Decision Tracking

 

·     The Director of Property and Projects will oversee the advance of the emerging projects listed in Appendix C to SOC stage.

·     The Director of Property and Projects will progress the non-recurring works based on the initial list outlined in Appendix D.

·     The Director of Finance and Resources will arrange the briefing for Party Group Leaders and Chairs of Standing Committees.

 

6.0       Key to Abbreviations

 

            SP&R – Strategic Policy and Resources Committee

            SOC – Strategic Outline Case

            LIF – Local Investment Fund

            CIF – City Investment Fund

 

7.0       Documents Attached

 

            Appendix C - Emerging Projects for which a Strategic Outline Case (SOC) is to be Developed

            Appendix D - Initial Phase of Non Recurring Projects

 

Appendix C: Emerging Projects for which a Strategic

Outline Case (SOC) is to be Developed

 

·        Windsor stadium / Olympia Development

·        Leisure Estate

·        Falls Park Masterplan projects

·        City Hall East (Event space, parenting room etc.)

·        Alleygating Phase 4

·        Whiterock Community Corridor

·        Half Moon lake Jetties

·        Drumglass Park Entrance

·        Orangefield Cycle track

·        New MUGA’s

·        MUGA Refurbishment

 

Appendix D: Initial Phase of Non Recurring Projects

  

LOCATION	Work needed	By Location
Andersontown Leisure Centre	Replace floor coverings to changing & shower areas and roof lights and roof covering	£145,000
Avoniel Leisure Centre	Pool repairs	£146,500
Avoniel Play Centre	Toilet refurbishments	£9,000
Ballymacarrett RC	Refurbish toilets, roof and main hall floor and floors and ceilings	£102,500
Ballysillan Leisure Centre	Renew floor covering in changing areas and pool repairs	£80,000
Belfast Zoo	Café refurbishment Zoo improvements	£ 171,975
Blanchflower Playing Fields -Changing Pavillion	Floodlighting and pitch refurbishment	£30,000
Botanic Gardens - Bandstand 1	Additional electrical supply	£1,975
Cecil Ward Building	Toilets and Kitchen refurbishments	£90,200
Cherryvale Playing Fields - Changing Pavillion	Small Fence at playground	£5,000
City Hall	Cenotaph re-grouting and ramp, Function Rooms - Audio Visual Screens	£105,000
Clarendon Park Playing Fields - Changing Pavillion	Installing BEMS	£10,000
COBFP - Changing Pavillion	Installing BEMS	£10,000
Concorde Community Centre	Path Improvements	£3,000
Duncrue Complex	Building improvements	£79,000
Grosvenor Road Community Centre	Upgrade external lighting	£17,755
Grove Wellbeing Centre	Close off room multipurpose room 3	£2,000
Grove Playing Fields -	Ball stop fence	£10,000
Inverary Community Centre	Roof lights repairs and main hall window replacements.	£5,000
ISB Main Building	Air Condition installation (2nd floor)	£25,000
LOCATION	Work needed	By Location
King George V Playing Fields - Changing Pavillion	Replacement of fence along river and Entrance	£30,000
Knocknagoney Community Centre	Install lighting at top end of park	£28,500
Lagan Islands	New fence & gates for cattle to graze	£5,500
Markets Community Centre	Front entrance resurface steps including tactile strip & visual contrasting (DDA)	£1,000
Maysfield Learning & Development Centre	Redecorate internal and external	£15,000
Morton Community Centre	Kitchen extension	£12,450
Musgrave Park - Bothy	Additional lighting / CCTV around car park	£37,500
Ormeau Bowling Pavilion	Install lighting, disabled ramp and railings	£126,150
Olympia Leisure Centre	Boiler and PH Pool system replacement	£31,500
O-Zone/Tennis Centre	Roof replacement	£95,000
Percy Street Community Centre	Provide porch at entrance	£16,750
Roselawn Crematorium	Install handrails to Garden of Remembrance	£3,000
Shaftesbury Community Centre	Office & toilets conversion	£18,750
Shankill Leisure Centre	New flooring for dry and wet changing and sauna corridor.	£90,000
Smithfield Market	External paving and roof refurbishment	£34,000
ST&LD Park - Conservation/Education Centre	Office space for outreach staff and repairs to ramp and toilet floors	£62,500
St. George's Market	Refurbish toilets, baby room and installation of hot running water in fish areas.	£75,000
Strangford Avenue Changing Accom – Building 2	Convert store to attendants office, skim walls, ceiling and fixing heating	£5,500
Waterfront Hall	Replace emergency lighting uninterruptible power supply units (UPS's) and batteries	£85,000
Whiterock Leisure Centre - Changing Pavillion	Renew rubber flooring except kitchen and lobby	£15,000
		£1,837,005”

 

            After discussion, the Committee adopted the recommendations.