The Deputy Cabinet Member for Regeneration and the Interim Director of Regeneration have been invited to attend.

The Chairman welcomed the Deputy Cabinet Member for Regeneration, the Chief Executive, the Interim Director of Regeneration, the Regeneration Project Support Officer, and the Head of Legal Partnership to the meeting.

The Chairman asked Officers and the Deputy Cabinet Member for Regeneration to give an overview of the original scheme and the current position.

The Chief Executive gave a short history and outlined that in 2012 Swale Borough Council went to market with a combination of its own and Kent County Council land in the Town Centre, and a consortium of Cathedral Group, Altyon Partners and Essential Land, called the Spirit of Sittingbourne, won the procurement exercise.  A Development Agreement was agreed, which set out what partners were trying to achieve. There have been various take-overs and changes to the consortium since then, and it currently consists of the Quinn Group, U and I, and Essential Land. The consortium, supported by the Council were also successful in its bid for Local Growth Fund money, receiving an allocation of £2.5 million.

The Chairman invited Members to ask questions and the following issues were raised:

·        clarification on the delay in highways realignment and changes to the station forecourt, and whether the Local Growth Fund money would be reclaimed if the works were not carried out by the end of the financial year?;

·        was the project built around the sale of properties, and what was Plan B if the current approach failed?;

·        confirmation of who sat on the Strategic and Operational Boards;

·        what was the benefit of the Travel Lodge Hotel planning application recently submitted?

·        had the 0.6m parking space provision for each unit at the two-bedroomed flats at Cockleshell Walk Car Park site changed, and where would service vehicles and visitors park?

·        would the drop-off and pick-up area around the train station be enhanced? and

·        concern over the lack of connectivity between the High Street and the development site.

The Regeneration Project Support Officer explained that the highways and Network Rail issues were complicated because it was the main A2 and needed to provide pedestrian, taxi and bus access.  He advised that the plans were at a very advanced stage, and he would be meeting with Network Rail and Kent Highways soon.

The Chief Executive advised that it was envisaged from the start that the development would go to the market for funding, and that it was never the case that the sale of the residential properties would be enough to fund the whole scheme.

The Chief Executive advised that a list of who sat on the Strategic and Operational Boards could be provided but stressed that neither were decision-making boards and they did not have delegated powers.

The Deputy Cabinet Member for Regeneration considered the interest by Travel Lodge Hotel a positive development, and the Chief Executive added that the Travel Lodge Hotel would be a positive signal to the market.  The Regeneration Project Officer advised that the design of the Travel Lodge Hotel would compliment the cinema.

The Regeneration Project Support Officer also confirmed that the development at the Cockleshell Walk site had already been through the planning process, and there had been no changes to the 0.6m parking space provision.  He advised that the anticipation was that the flats would be bought by the commuter market.

The Regeneration Project Support Officer added that that the design of the scheme around the station allowed for remedial works for drop-off and pick-up, and consideration was being given to an additional pedestrian link to the High Street, as well as the two links already planned.

A Member raised concern about the scheme’s project management and the lack of information that had been available to Members.  The Regeneration Project Support Officer advised that the scheme was not a defined project being managed by SBC, it was a development scheme, with the developers project managing and investing their own money. This Council had no direct project management responsibilities and their involvement is limited to overview and the progressing of Cabinet or delegated approval for details and proposals, as provided for in the Development Agreement. The Chief Executive added that SBC had some assets involved and could hold the developers to account in terms of their meeting the terms of the Development Agreement.  He explained that there was some commercial confidentiality within the development but relevant Officers and Members were happy to attend Scrutiny or meet on a regular basis.  A Member considered that the size and importance of the project would warrant the Scrutiny Committee’s own steering group.

In response to a question from a Member on the levels of risk to the Council at the current time, the Chief Executive advised that non-completion of the scheme could lead to a risk of reputational damage, but there were options for delivering and all efforts were being made to achieve completion. He stressed that the only financial risk if the scheme did not go ahead was the abortive costs of officer time and legal advice already undertaken. The Leader added that the risk of non-delivery of the scheme was at the lowest it had been.

In response to questions from a Member, the Regeneration Project Support Officer confirmed there were 63 rooms in the proposed Travel Lodge hotel; the former underground subway that linked the train station to the Forum was unusable as it had been filled with concrete; and that guests of the Travel Lodge hotel would be able to use the Swale managed car parks at a special 24-hour rate, or free after 6pm.  He also confirmed that Huber Car Park Systems had submitted detailed drawings which were now being considered, and that work was continuing to market the four other restaurant units.  The Deputy Cabinet Member for Regeneration added that the restaurants that have already signed their leases were national chains, and reminded Members that Marks and Spencer Food, Costa Coffee and Starbucks had all recently signed leases in Sittingbourne, which was a positive signal.

The Chief Executive explained that if any of the £2.5million from the SE LEP Growth Fund was not spent by the end of this financial year, it could be clawed back.  The Leader added that it was in the interests of the private sector partners to keep to the deadline.

A Member was disappointed in the lack of detail in the report, suggested wider engagement with Members and sought more information on the Governance of the project.  A discussion ensued and the Chief Executive clarified that the current arrangements were within the Council’s Constitution.

In response to further questions, the Chief Executive advised that some financial issues could not be discussed in open session, and the scheme  depended on cross-subsidy from the more profitable elements to the less profitable elements.  Whilst there had been some hold-ups in the scheme, for example, Spirit’s attention was diverted during the take-over and rebranding the Cathedral Group, the single biggest issue that outweighed all other considerations was the viability of the scheme, made more challenging as build costs had increased more than expected, so the Council and Spirit are fighting against market economics, and dealing with small investment margins.

A Member spoke of residents’ concerns on the proposed road layout and the implication on roads in the surrounding area, and asked if traffic modelling on the current plans could be made available?  The Regeneration Project Support Officer advised that traffic modelling was complex, and whilst information could be provided it would not give detailed, usable information such as routes taken to the cinema.

Members discussed the issue of communication and the following points were raised:

·        there needed to be a better communication system to Members and the wider community;

·        individual Members were responsible for finding out information and relaying back to their Groups and wards;

·        officers and Cabinet Members were willing to share information;

·        communication should be honest;

·        too much negativity from the press and

·        more regular updates required and explanations when timelines changed.

In response to a question from a Member on expected progress over the next three to six months, the Interim Director of Regeneration advised that her focus would be on the matters set out in the report for Scrutiny, along with coordinating communication with Spirit on progress in delivery.

The Regeneration Project Support Officer advised that a presentation for Members on the residential site was planned by the proposed purchasers.

The Regeneration Project Support Officer also advised that Essential Land had agreed to transfer two parcels of land on the Mill Site very shortly and one parcel will be drawn down in the near future when work will commence on the Dolphin Barge Museum.  The Interim Director of Regeneration added that there were on-going positive discussions on the Skate Park to be located on the second parcel of land.

The Chairman and other Members thanked the Chief Executive and Officers for their attendance and their important contribution to the meeting.

Recommendations:

(i)                   That Cabinet considers appointing a Scrutiny Committee representative to sit on the Strategic Board to feed into the meeting and ensure that the Scrutiny discipline is recognised

(ii)                  That for the next twelve months, there be an update directly from a representative of the Strategic Board at each Scrutiny Committee

(iii)                 That a monthly update to questions, in a format to be agreed in conjunction with the Scrutiny Committee Chairman and Policy and Performance Officer, be provided by the Cabinet Member for Regeneration to all Members in the form of a bulletin.