This report proposes establishing bespoke housing delivery vehicles to expand the Council’s range of interventions in the housing market and provide a range of new homes to meet the needs of the rapidly growing local population.

The Pre-Decision Scrutiny Questions and responses were noted.

The recommendations were amended and then agreed.

DECISION

1.    To agree to establish Seahorse Homes Limited, a Wholly Owned Company Limited by Shares, and Mulberry Housing Society, a Community Benefit Society, and delegate to the Corporate Director, Place after consultation with the Corporate Director, Resources and the Corporate Director Governance authority to take all necessary steps for this purpose including but not limited to approving the Rules of the Society and Articles of Association of the Company.

2.    To agree that the officers identified in section 4 of the report be appointed as directors and members of the Wholly Owned Company (WOC) and Community Benefit Society (CBS) respectively.

3.    To authorise the Corporate Director, Place to recruit three independent members to the CBS, after consultation with the Mayor and Statutory Deputy Mayor and Cabinet Member for Housing Management and Performance and Cabinet Member for Strategic Development, ensuring that the appointments are made on the basis of relevant skills and expertise and the recruitment process follows equalities principles in terms of promoting diversity on the Board.

4.    To authorise the Corporate Director, Resources to agree and sign off the final business case.

5.    To authorise the Corporate Director, Resources to

a)    make equity investments up to £6M in the WOC

b)    grant up to £9M of retained Right To Buy receipts and £2.5M of s106 commuted sums to the CBS with appropriate grant conditions;

c)    make available to the WOC a commercial loan facility up to £24M;

d)    make available to the CBS a loan facility up to £18.5M charged below a full commercial rate;

e)    enable both loan facilities by use of reserves and prudential borrowing within the General Fund as necessary;

subject to the above being in line with the Council’s Budget  framework, where required, the negotiation and finalisation of the loan agreements and decision to release funding subject to satisfactory due diligence delegated to the Corporate Director, Resources.

6.    To authorise the Corporate Director, Resources to approve the WOC and CBS’s first business plan.

7.    To agree to provide the WOC and CBS with a credit facility of up to £50,000 each for use as working capital and delegate to the Corporate Director, Resources the negotiation and finalisation of the necessary agreements.

8.    To delegate authority to the Corporate Director, Place after consultation with the Mayor, Statutory Deputy Mayor and Cabinet Member for Housing Management and Performance and Cabinet Member for Strategic Development, the Corporate Director, Resources and the Corporate Director, Governance to approve the Shareholder Agreement, Deed of Covenant and any other necessary agreements required between the Council and the WOC and CBS respectively. In particular, ensuring that the Deed of Covenant protects the local accountability and focus of the CBS by restricting the scope for future changes in ownership (including mergers and acquisitions), business purpose, scope, or status (such as registration as a Registered Provider).

9.    To authorise the Chief Executive to exercise the Council’s rights as Shareholder.

10.To authorise the Corporate Director, Governance to execute the agreements referred to in recommendations 5, 7 and 8 above.

11.To agree that, subject to final sign off of the business case as specified in 4 above and the Council and the WOC entering into the ancillary agreements referred to in recommendations 5, 7 and 8 above, the Company may commence trading.

Action by:

CORPORATE DIRECTOR, PLACE (A. DALVI)

(Interim Divisional Director, Housing and Regeneration (M. Baigent)