Agenda item

(Cabinet Member with Special Responsibility Councillor Hanson)

Report of Chief Officer (Regeneration & Planning)

(Cabinet Member with Special Responsibility Councillor Hanson)

Cabinet received a report from the Chief Officer (Regeneration & Planning) to update Members on the proposed project to improve the River Lune flood defences and authorise further actions to assemble the funding package and progress the project.

The options, options analysis, including risk assessment and officer preferred option, were set out in the report as follows:

The officer preferred option is Option 2.  This decision allows the council to accept RFCC resources to progress the detailed design and bring more certainty to deliverability and costs in order to inform other funding applications.  Progressing a phased tender under the WEM framework will give the council the detail it requires to secure funding and statutory approvals and also mean that a preferred contractor is available to deliver the scheme immediately on full funding being secured for the whole scheme, confirmation of WEM compatibility and statutory approvals being granted.  

While progressing a full ERDF funding application does not commit the council to accepting ERDF funds, or progressing a full scheme, more detailed work has to be undertaken if the application is to be successful and for there to be the a chance of meeting ERDF contracting and delivery deadlines and the EA’s Outline Business Case requirements for FDGiA.  Option 2 also allows officer to explore in more depth the appetite of the major businesses to assist with significant financial contributions and continue to investigate other potential public funding sources.     

Currently the EA and the County Council (LLFA) are concentrating on developing the Phase 4 project for the City Centre. Left to the LLFA and the EA’s own priority scoring mechanisms a scheme to improve protection for this significant and important industrial area may not come forward in the medium or even long term.

                             There remains an acute need to promote this scheme to help secure its delivery and the proposed course of action represents the next most appropriate route towards achieving a positive outcome, both  meeting the council’s regeneration objectives and having wider social, economic and environmental impacts. In summary the current estimated cost of the project is £9.4M (including a substantial contingency “optimism bias”.

Contributions to this cost which are likely to come from external sources are:- 

                        RFCC              £2M

                        FDGiA             £2.6M

                        ERDF              £3.1M

                        _________________

                        Total               £7.7M

The current shortfall to be met from business or other contributions is currently £1.7M although this will be clarified and amended as the detailed design phase is progressed. 

Councillor Hanson proposed, seconded by Councillor Pattison:-

“That the recommendations, as set out in the report, be approved.”

Councillors then voted:-

Resolved unanimously:

(1)             That Members note the allocation and accept the offer of £2M funding from North West Regional Flood and Coastal Committee (RFCC) when formally awarded and delegate to the Chief Officer (Regeneration and Planning), in consultation with the Cabinet Portfolio Holder, authority to use approximately £200K to undertake design development work (Stage 1) and submit a planning application.

(2)             That delegated authority be given to the Chief Officer (Resources) to update the General Fund Revenue Budget to reflect the design development expenditure and associated RFCC funding as appropriate.

(3)             That a full European Funding application be submitted, following the approval of the ERDF outline application.

(4)             That Members note the indicative allocation of £2.6M from the Environment Agency’s Flood Defence Grant in Aid (FDGiA) and authorise officers to progress and submit the Full Business Case to formally secure the funding.

(5)             That Officers work with the major Caton Road business to negotiate / secure private funding contributions and also investigate any further public funding avenues to meet the full scheme construction costs.     

(6)             That agreement of the above is on the basis that:

·                     the scheme is wholly externally funded and that there is no commitment to allocate city council capital or revenue funding;

·                     the council would withdraw from scheme development at any early stage without the risk of RFCC grant clawback if it transpires that reasonably, there is no prospect of securing sufficient stakeholder buy-in and/or financing for the scheme.

(7)             That a further report is made to Cabinet to ensure financial, procurement, legal and operational implications are resolved prior to acceptance of any ERDF funding, FDGiA funding and private sector contributions; and before contractually committing to implementing the construction phase (Stage 2).

Officers responsible for effecting the decision:

Chief Officer (Regeneration & Planning)

Chief Officer (Resources)

Reasons for making the decision:

The decision is consistent with the Economic Growth priority within the Corporate Plan.  The flooding risk in the industrial areas undermines business and investment confidence.  The emerging Local Plan cannot identify extensive new areas for employment development to replace such an area and therefore the priority approach should be to increase the level of protection to restore business confidence.