CAT Sub 1 Beechwood CC - 21 05 25 ILE
Renfrewshire Council · 21 May 2025
Back to Community Asset Transfer Sub-committee — 21 May 2025 and its agenda
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2 ___________________________________________________________________ To: Infrastructure, Land & Environment Policy Board Community Asset Transfer Subcommittee On: 21 May 2025 ___________________________________________________________________ Report by: Chief Executive ___________________________________________________________________ Heading: Community Asset Transfer Request – Beechwood Community Centre, Shortroods Road, Paisley - Update ___________________________________________________________________ 1. Summary 1.1 This report follows the continuation of the asset transfer request considered by the Sub Committee on 19 March 2025. 1.2 The purpose of this report is to provide advice on the range of conditions that can be applied to asset transfers to protect the public interest and to propose conditions to be applied to the asset transfer of Beechwood Community Centre to Your Community, Your Space SCIO. 1.3 Members are referred to the previous paper for details of the asset transfer request and community transfer body. ___________________________________________________________________ 2. Recommendations 2.1 It is recommended that the CAT Sub-Committee:- (i) Consider the range of conditions which may be applied to asset transfers; (ii) Agree to the sale of the asset via asset transfer to Your Community, Your Space SCIO subject to the conditions detailed in section 6 of this report, or others as determined; and (iii) Authorise the Head of Economy and Development together with the Head of Corporate Governance to conclude the sale of the asset in accordance with the Act and on such terms as required to protect the Council’s interest.
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3 ___________________________________________________________________ 3. Background 3.1 The CAT Sub-Committee met to consider an asset transfer request for Beechwood Community Centre on 19 March 2025. 3.2 At that meeting, the Sub-Committee requested consideration of the transfer request be continued for advice on conditions which could be included to protect public interest in the asset and for community benefit. 3.3 Asset transfer is governed by Part 5 of the Community Empowerment (Scotland) Act 2015 (the Act) which provides the right for community bodies to request outright ownership, short or long term lease or other rights over any land or property owned or leased by the Council. 3.4 The Act requires local authorities to assess requests transparently against a specified list of criteria, and to agree the request unless there are reasonable grounds for refusal. 3.5 Section 83(2)(a) of the Act states that the decision notice relating to a request must – “specify the terms on which, and any conditions subject to which, the authority would be prepared to transfer ownership of the land, lease the land or (as the case may be) confer rights in respect of the land to which the request relates (whether or not such terms and conditions were specified in the request)”. 3.6 Neither the Act nor the associated Regulations 2016 specify what these conditions may be, however, the Scottish Government provides guidance to relevant authorities on the types of conditions that could be applied in relation to achieving best value and to protect discount. The guidance states that “it is for relevant authorities to determine whether it is appropriate to include such conditions in the contract (and for community transfer bodies to decide whether to accept the transfer on those terms)”; and, if used, that these are done “in an appropriate and proportionate way”. 3.7 Any conditions must be detailed in the CAT decision notice and be set out in the ensuing contract via a formal legal mechanism such as a standard security or minute of agreement, which may contain a range of provisions and be linked to a standard security. ___________________________________________________________________ 4. Use of Conditions in Asset Transfer 4.1 Public sector organisations are required to achieve best value in their property transactions. The guidance states that in the case of asset transfer to community bodies, disposal at less than market value may be justified by reference to the expected benefits to be delivered by the project. 4.2 Relevant authorities may seek to protect themselves against the risk that the benefits may not be delivered by including clauses (conditions) in the contract requiring some form of restitution if the project fails.
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4 4.3 Any conditions which the relevant authority proposes to impose should be included in the decision notice and in sufficient detail that the community transfer body is able to decide whether they are acceptable or not. As a result, the community transfer body could seek to challenge them through the review and appeal process. 4.4 Where ownership of the asset is transferred, the guidance identifies three main ways relevant authorities can seek to protect the potential value discount. These are: i. where a reduced price was agreed in recognition of the benefits to be delivered - the community body may be required to repay the difference in price if the benefits are not delivered; ii. where the price was based on a lower valuation for a particular use - conditions may be imposed to return any increase in value to the authority, if the use of the property is changed or the expected benefits are not delivered; and iii. if the property itself is important to the community - arrangements may be made to enable the authority to recover the property if it is no longer used by the community body for the agreed purpose (or the community body is wound up). 4.5 However, the relevant authority may specify its own conditions to protect its interest so long as these are appropriate and proportionate. 4.6 The usual triggers for the implementation of conditions are if the project fails, the community transfer body (CTB) is wound up, or it seeks to dispose of the property, either by sale or lease, for a purpose other than was expected at the time of transfer. 4.7 The terms set out in the contract must be clear, setting out the trigger points for the condition to be activated and the basis for calculating any repayment. Appropriate and proportionate 4.8 In most asset transfer cases, there will be other organisations providing funding to the project in addition to any concession given by the relevant transfer authority. Excessive requirements for repayment or conditions on asset transfer could restrict the ability of the CTB to attract funding and to develop new projects over time thereby making the project unviable. 4.9 Proportionality should take into account: • the value of the concession granted; • the scale of the authority‘s contribution within the overall project; and • the time within which benefits are expected to be delivered. 4.10 In some cases, the contribution provided by funding bodies may be substantially greater than the value of the concession granted by the relevant authority, or even greater than the value of the property, especially when there is significant redevelopment or new build planned. Any conditions applied
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5 should therefore recognise the scale of the relevant authority‘s interest within the overall project. 4.11 Similarly, the duration of the protection mechanism should reflect the amount of discount compared to the expected benefits. It may be appropriate for the amount to be returned to reduce over the period within which the benefits are expected to be delivered. Any mechanism which restricts the use of the property should take account of the community body‘s need to develop in the longer term. ___________________________________________________________________ 5. Beechwood Community Centre 5.1 Beechwood was valued by the Estates team at £100,000. The CTB has offered to pay £5,000 representing a discount of 95%. This is offset against a range of community benefits, most significantly, of keeping the asset operating as a community centre for the benefit of the local community. 5.2 In addition, asset transfer of the asset will generate revenue savings to the Council of over £33,000 per annum and estimated short and long-term repair costs in excess of £750,000. 5.3 In relation to the three main ways the guidance suggests relevant authorities can seek to protect the discount in the transfer of ownership, the Council could i. Seek to recover the difference in price, £95,000, if the benefits proposed are not delivered. If this condition is to be applied, consideration will be required of how benefits would be monitored as well as the timescale and threshold which would trigger the condition. A condition such as this may negatively impact the CTB’s ability to raise external funding thereby threatening the viability of the project. ii. Require the CTB to return any increase in value to the local authority, if the use of the property is changed or the expected benefits are not delivered. It is officer’s view that any increase in value will only be achieved through carrying out extensive repairs which are likely to be funded through charitable contributions, grants and external funding. Similar to above, this condition will require monitoring of benefits and agreement on timescales and thresholds and is likely to be considered detrimental by funders thereby restricting access to external funding and threatening the viability of the project. iii. Make arrangements to recover the property if it is no longer used by the community body for the agreed purpose (or the community body is wound up). As a SCIO, Your Community, Your Space has provision in its constitution that on winding up, any surplus property (after the satisfaction of liabilities) passes to another charity or community body for community benefit. The Council could set a condition that, in the
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6 event the asset is no longer used by the community body for the agreed purpose (or the community body is wound up), the asset would return to the Council (with all associated liabilities). ___________________________________________________________________ 6. Asset Transfer of Beechwood Community Centre – Proposed Conditions 6.1. A primary concern of the Sub-Committee at their meeting in March 2025 was protecting the future use of the asset for the benefit of the wider community. It is therefore suggested that any conditions applied focus on this aspect as opposed to any repayment options thereby limiting any detrimental effect on the CTB’s ability to secure external funding. 6.2. Permitted use is a normal key component of the formal CAT decision notice and subsequent minute of agreement. This can be enhanced to be very specific about the types of use and conditions, for example: The asset being transferred may only be used as a community centre for the benefit of the immediate Shortroods community and wider Paisley area. To satisfy use as a community centre, the purchaser must i) offer or facilitate delivery of activities which meet the learning, social or wellbeing needs of the community and/or as may be requested by the community from time to time; ii) permit others to hire or otherwise use space in the centre for the delivery of activities which meet the learning, social or wellbeing needs of the community; iii) enable members of the community to hire the space for community events and for social use such as birthday parties, weddings, etc. 6.3. In addition we will specify that the community transfer body must agree to i) establish a bespoke forum to contribute to the running of the centre for community benefit to comprise YCYS Board members and local residents in equal numbers; ii) actively seek to recruit members to the organisation from the local community and to co-opt up to two such members as full trustees of the charity in accordance with their constitution; and iii) permit access to the asset by Renfrewshire Council officers and submit a report on activity in each of the first 5 years following the transfer for the purpose of monitoring permitted use and expected benefits (as detailed in the asset transfer request). 6.4. Renfrewshire Council reserves the right to revoke the asset transfer decision and seek to recover the asset in the event that: iv) the permitted use is not complied with; v) the asset is no longer used by the community body for the agreed purpose; or
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7 vi) the community body is wound up within 5 years of the transfer having taken place. 6.5. The period for invoking the condition above will be 5 years from the date of transfer. 6.6. Renfrewshire Council will establish a 5-year strategic partnership agreement with the community transfer body for the purpose of monitoring the permitted use and delivery of key outputs and outcomes. 6.7. Officers will bring a report on progress and activity to the CAT Sub Committee (or its equivalent Board) at the end of year 1, year 2 and year 5. ______________________________________________________________ Implications of the Report 1. Financial – None. Other than those covered in the body of the report. 2. HR & Organisational Development – None. 3. Community Planning Our Renfrewshire is well – the CAT supports the wellness and resilience of our citizens and communities by maintaining and building on a community resource. 4. Legal (a) Conditions required to be detailed in the CAT decision notice and be set out in the ensuing contract via a formal legal mechanism such as a Minute of Agreement and Standard Security. (b) A formal offer from the CTB must be received within 6 months of decision to approve. (c) Sale must be concluded within 6 months of a formal offer being submitted by the CTB. 5. Property/Assets – Cat requests seeks approval to dispose of the asset reference 123069028. 6. Information Technology – None. 7. Equality & Human Rights - The Recommendations contained within this report have been assessed in relation to their impact on equalities and human rights. No negative impacts on equality groups or potential for infringement of individuals’ human rights have been identified arising from the recommendations contained in the report. 8. Health & Safety – None. 9. Procurement – Not applicable. 10. Risk – None.
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8 11. Privacy Impact – Not applicable. 12. Climate Risk – Not applicable. 13. Children’s Rights - This report does not cover a new policy, function or strategy nor a substantive change to an existing policy, function or strategy which will have an impact on children’s rights. 14. Cosla Policy Position – not applicable. _________________________________________________________ List of Background Papers a) CAT Request for Beechwood Community Centre, Shortroods Road, Paisley PA3 2QY, Paisley; Infrastructure, Land & Environment Policy Board, Community Asset Transfer Subcommittee, 19 March 2025 ________________________________________________________________ Author: Sandra Inrig – 0141 487 1447 or 07974 071238. sandra.inrig@renfrewshire.gov.uk