Supplementary Pack 1
Argyll and Bute Council · 12 September 2024
Back to Argyll and Bute Harbour Board — 12 September 2024 and its agenda
Text extracted from the council's PDF. Layout and reading order may differ from the original.
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Argyll and Bute Council Comhairle Earra-Ghàidheal Agus Bhòid Executive Director: Douglas Hendry Kilmory, Lochgilphead, PA31 8RT Tel: 01546 602127 Fax: 01546 604435 DX 599700 LOCHGILPHEAD 9 September 2024 SUPPLEMENTARY PACK 1 ARGYLL AND BUTE HARBOUR BOARD - ON A HYBRID BASIS IN THE COUNCIL CHAMBER, KILMORY, LOCHGILPHEAD AND BY MICROSOFT TEAMS on THURSDAY, 12 SEPTEMBER 2024 at 12:30 PM, or at the conclusion of the Environment, Development and Infrastructure Committee at 10.30 am, whichever is the later. I enclose herewith item 5 (MARINE ASSET MANAGEMENT PLAN) which was marked to follow on the Agenda for the above meeting. Douglas Hendry Executive Director ITEM TO FOLLOW * 5. MARINE ASSET MANAGEMENT PLAN (Pages 3 - 14) Report by Executive Director with responsibility for Roads and Infrastructure Services Argyll and Bute Harbour Board Councillor Fiona Howard Councillor John Armour (Vice-Chair) Councillor Ross Moreland (Chair) Councillor Gordon Blair Councillor Dougie McFadzean Councillor Maurice Corry Councillor Liz McCabe Councillor Andrew Vennard Contact: Hazel MacInnes Tel: 01546 604269 Public Document Pack
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ARGYLL AND BUTE COUNCIL ARGYLL & BUTE HARBOUR BOARD ROADS AND INFRASTRUCTURE SERVICES 12 SEPTEMBER 2024 MARINE ASSET MANAGEMENT PLAN 1.0 INTRODUCTION 1.1 This report provides Harbour Board Members with a review of the marine infrastructure works Marine Asset Management Plan. It includes an update on significant and major programmes currently planned and underway within Argyll and Bute Council’s Marine Asset Management Plan. 2.0 RECOMMENDATIONS 2.1 Members of the Harbour Board Committee are asked to: a) Consider the update on the major programmes currently being addressed within Argyll and Bute Council’s Marine Asset Management Plan. b) Note that £23.4 million worth of capital works are underway or about to commence in the financial year 2024 / 2025. c) Note that there is a potential spend of c. £129 million over the next 5 years, the majority of which will support the new CMAL & CFL / CalMac fleet renewal. d) Note the new Marine Asset Management Board structure for monitoring and managing marine infrastructure projects. e) Recommend to the Council, when setting the fees and charges for 2025 / 2026 that it approves an increase to piers and harbours fees and charges of 8% to generate sufficient income to develop the Council’s marine infrastructure. 3.0 DETAIL 3.1 The Marine Asset Management Plan lists the current programmed work to be carried out over the next 5 years. The plan is adaptable and can change to suit emerging priorities and circumstances. This plan details projects located throughout the entire Council area, many of which include work to adapt existing infrastructure to support CalMac Ferry Limited (CFL) in advance of new vessels being delivered. 3.2 Funding for these projects is mainly delivered by Prudential Borrowing, paid back through fees and charges collected at our major ports. Page 3 Agenda Item 5
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Overall, the cost of delivering the programme has risen significantly and the proposed increase is more than was expected. Some of the reasons for that will be well known to Members, with world events and issues taking a toll that must now be recognised in our planning. Projects are competitively tendered to ensure a wide range of quotations, delivering value for money and across a range of Suppliers to ensure works are delivered to a high quality. Projects are monitored and re-forecast regularly to manage risks and adjust budgets to suit. 3.3 A new Marine Asset Management Board will sit at least quarterly each year to review the ongoing and planned projects. It is chaired by the Executive Director with overall responsibility for Roads and Infrastructure Services who is also the Duty Holder in respect of the Port Marine Safety Code. The Board will consider papers as presented in Appendix 1 and 2 attached to this report, namely: - The condensed 5-year MAMP spreadsheet providing an overview of projects and estimated costs; and The RAG rated project descriptions with associated costs to date. Along with the more detailed update on the individual projects, together, it is hoped these will provide a transparent view of the works being undertaken and provide reassurance for Harbour Board Members for approval of fund allocation and priorities. They are in a developmental stage and will undergo further improvements. 3.4 The following paragraphs provide a brief update on several key projects currently underway or due to start. Additional details are available with the attached appendices. 3.4.1 Craignure – New Ferry Terminal The GI works awarded to DUNHELM Geotechnical & Environmental Ltd have now been successfully completed on site. Officers are anticipating receipt of the final interpretation report at the end of August. Meeting of the reference and working groups will be arranged for as soon as schedules permit in Craignure. These meetings will provide an opportunity to discuss the options and limitations based on the GI findings. A timeline is being developed around some assumptions, on the scale of construction for each option and location. Following extended local consultation and input, the potential issue of consensus between Craignure Community, CFL and the wider Mull and Iona views on scale will require a resolution when the reference group meet. Costs are estimated at £3M over the next two years, to reach construction stage, which includes completion of business cases, Environmental Impact Assessments, design and tendering. Page 4
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3.4.2 Iona breakwater – protection of ferry berthing slip Award of this contract has been delayed. This is due to Nature Scotland requiring additional conditions and mitigations to be attached to the Marine License. Discussions have taken place with the Marine Directorate and officers are hopeful that this will be resolved soon to complete contract award and confirm start dates. Contract commencement is now anticipated to be Autumn 2024 to allow stockpiling of materials with physical start on site expected in Spring 2025 and an estimated completion by summer 2026. These works will include the adjacent slipway repairs as well as the replacement of the toilet block. 3.4.3 Fionnphort overnight berthing facility Preparation is progressing with Fionnphort to ensure: • Overnight berth • Safe access for crew • Sheltered berthing • Charging and supply facilities • Traffic survey to enhance the road passenger interface at the terminal area. An Environmental Impact Assessment (EIA) is in process including the socio- economic assessment. Design colleagues have addressed all potential issues with CalMac Marine regarding swept paths and approaches. When Marine Scotland approve the EIA we will continue with the marine licences, public engagement and other preparations with a view to tender in the summer of 2024. Costs are estimated at £500k for 2024 / 2025 and thereafter an estimated £25M for construction works. 3.4.4 Port Askaig – Marshalling area development for new CalMac vessels A design had been identified for the marshalling area however, following review of consultation feedback from communities and the level of facility we currently have, we are able to deliver a more cost-effective solution that remains within the parameters of the provision in the Marine Asset Management Plan, without the larger scale disruption and additional cost that would have been required by the concept design. This considers communities’ wish to preserve parking spaces and will deliver improved signage, lining, quayside traffic management and CCTV for Port Askaig in time for the new larger ferries arriving. We are now progressing that solution to enhance existing facilities and will be discussing operational plans with CFL and Transport Scotland. Port Askaig port enabling works being carried out by CMAL have now been completed and will aid in accommodating the new, larger capacity CalMac ferries. The first vessel is expected to be delivered at the end of 2024 and will enter service after sea trials and crew familiarisation. Page 5
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Costs are estimated at £2M for improvement works and CCTV installation. 3.4.5 Feolin Installation of a passenger only access at Feolin, for those periods when the vehicular vessel is not available. Although these occasions are relatively rare, we recognised the need for a pontoon and gangway system near the existing slipway for passengers with limited mobility. This will make a very significant improvement to the connectivity issues when there is a breakdown on the Eilean Dhiura. Drawings and plans are in the final stages with construction due to start over Winter 24/25. 3.4.6 Campbeltown Harbour Campbeltown Harbour continues to be very busy commercially with timber loading, in particular projected to increase at the port. Using Campbeltown as a strategic supply hub for the planned offshore wind projects is being explored and this represents a real opportunity, to develop the Port and secure long-term work in and from Campbeltown harbour. Replacement of ‘Wall A’ works are estimated at £6M to complete over the next two-year period. 3.4.7 Rothesay Harbour Stability works to the main berthing face are live and progressing well. Rock armour, placed in 2018 to minimise damage occurring from vessel thruster wash, has now been consolidated with specialist concrete and the construction of a toe wall to prevent further damage is well underway. This work is being undertaken on nightshift, to minimise disruption to the ferry service and regular coordination is being undertaken with Calmac to protect any especially busy times. These works are expected to extend into early 2025. Following this, a final phase will be required to repair the East Roundhead which is in significant decline. The scope of this is currently being determined. Costs are expected to be £4.5M over the two-year period. 4.0 Fees and Charges 4.1 In order to fund the various works identified in the Marine Asset Management Plan it is necessary to increase fees and charges on a year-on-year basis. Annual increases in future years are expected to be in the order of between 6% and 8%, depending upon confirmed works identified for that particular year (plus any discretionary inflationary increase). 4.2 Previous Expenditure - since 2018/19 the council has increased Fees and Charges for Piers and Harbours to fund prudential borrowing which in turn is financing the Asset Management Plan. The table 1 below shows the Page 6
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expenditure and financing costs since 2018/19 with any residue being placed in earmarked reserves to fund future expenditure. Table 1: Previous Expenditure 2018-19 £’000 2019-20 £’000 2020-21 £’000 2021-22 £’000 2022-23 £’000 2023-24 £’000 Total £’000 Actual 1,485 2,760 788 1,192 691 1,898 9,134 Loans Charges 44 148 167 315 359 442 1,482 Additional Income generated by uplift 177 516 529 988 1,506 1,778 5,607 Surplus income added to earmarked reserves 133 368 362 673 1,146 1,336 4,125 4.3 Proposed increases are smoothed over future years to avoid large spikes in the increases which would be required to fund the asset management plan in the years where large expenditure is planned. As illustrated in the table 2 below, the proposed increase for 2025/2026 is 8%. Table 2: Smoothing of Asset Management Plan Fees and Charges 4.4 Future income - the Asset Management Plan is an adaptable plan that is required to have flexibility to cope with changing priorities and circumstances. It also relies on steady and predictable income from those ferry services utilising Argyll and Bute Council infrastructure. 2025-26 £’000 2026-27 £’000 2027-28 £0’000 2028-29 £’000 2029-30 £’000 2030-31 £’000 2031-22 £’000 Planned expenditure 9,604 45,500 30,000 20,405 0 0 0 Anticipated Annual Loans Charges 1,995 3,426 5,475 6,842 7,418 7,418 7,418 Additional funding required to pay loans charges 907 1,431 2,049 1,367 576 0 0 Increase required if fully funded in year 9.25% 13.52% 18.26% 11.49% 4.44% 0.00% 0.00% Proposed increase to allow smoothing 8.00% 8.00% 6.00% 6.00% 6.00% 7.00% 6.50% Page 7
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A close watch on fees and charges income and its effect on future projects is maintained to ensure the statutory and priority works are delivered. The following table shows the anticipated income which will be generated by the increased fees and charges and the effect it will have on the earmarked balance. Table 3: Profile of income and borrowing costs 2025-26 £’000 2026-27 £’000 2027-28 £’000 2028-29 £’000 2029-30 £’000 2030-31 £’000 2031-32 £’000 Planned expenditure 9,604 45,500 30,000 20,405 0 0 0 Anticipated Annual Loans Charges 1,995 3,426 5,475 6,842 7,418 7,418 7,418 Anticipated additional income generated 2,783 3,567 4,202 4,875 5,589 6,497 7,424 Surplus transferred to / from earmarked reserves 788 141 -1,273 -1,967 -1,829 -921 6 Cumulative balance on earmarked reserves 5,881 6,022 4,749 2,782 953 32 38 5.0 CONCLUSION 5.1 This report provides Harbour Board Members with a review of the marine infrastructure works Asset Management Plan. It includes an update on significant and major programmes currently planned and underway within Argyll and Bute Council’s Marine Asset Management Plan. 6.0 IMPLICATIONS 6.1 Policy - None directly arising from this report. 6.2 Financial - There are proposed increases arising from this report. Increases to fees and charges are required to ensure future income is sufficient to maintain and develop Argyll and Bute Council’s marine assets for future years. Alternative funding routes will also be explored to support future projects. 6.3 Legal - Considered to be none directly arising from this report. 6.4 HR - None. 6.5 Fairer Scotland Duty: Page 8
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6.5.1 Equalities - protected characteristics - None directly arising from this report. 6.5.2 Socio-economic Duty - None directly arising from this report. 6.5.3 Islands - Completed works and projects will enhance service reliability and community connectivity. 6.6 Climate Change - There are no direct impacts regarding climate change from this report, due regard will be given to climate change with a view to minimising any climate change impact and these will be considered as and when they arise. 6.7 Risk - Completed works will reduce the repair and maintenance on existing infrastructure. Above inflation increases may have a detrimental economic impact on businesses using the facilities for example: • Fishermen • bulk importers • timber exporters • wind farm developers • Cruise companies Significant increases may also reduce usage and customers while making attracting new business more difficult. External influences may come to bear on ferry usage patterns which may, in turn, impact on income from ferry fees and charges i.e. Vessel breakdowns and redeployments, Environmental issues (car use), Brexit and potential changes in RET. This will pose a potential risk to income. 6.8 Customer Service - An overall improvement in travel experience and reliability should result with improved and maintained infrastructure. 6.9 The Rights of the Child (UNCRC) - None directly arising from this report. Kirsty Flanagan, Executive Director with responsibility for Roads and Infrastructure Services Policy Lead for Roads, Transport and Amenity Services, Councillor John Armour September 2024 For further information contact: Jim Smith, Head of Roads and Infrastructure Services Scott Reid, Marine Operations Manager APPENDICES Appendix 1 - Marine Asset Management Plan Appendix 2 - Marine Capital Project Tracker Page 9
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Classification: OFFICIAL# 1 Asset Location 2024/25 Items 2025/26 Items 2026/27 Items 2027/28 Items 2028/29 Items Bunessan £5,000 CAT 5 upgrade Campbeltown New Quay £100,000 HPU Control panel and cylinder O/H Campbeltown Old Quay £5,000,000 Construction wall A £1,000,000 Construction wall A Craignure Pier £1,000,000 Licencing. Finalise design and Tender documentation £2,000,000 Finalise design and Tender documentation £20,000,000 Construction of terminal £20,000,000 Construction of terminal £10,000,000 Complete construction of terminal Craignure PAS £1,000,000 Consultant supporting preparation on tender for new structure. Aiming to tender for new PAS in Q3 FY24/25. Result of this will inform on precise costs for a new PAS structure Cuan Ferry slips (Cuan & Luing) £2,000 Development of outline business case for future infrastructure £2,000,000 Future provision Easdale Piers £1,000 Development of outline business case for future infrastructure £2,400,000 Future provision Ellenabeich Pier £1,000 Development of outline business case for future infrastructure £5,000,000 Future provision Gigha Ferry slip £300,000 Consultancy for Design & EIA (inc Tayinloan) £300,000 Consultancy for Design & EIA (inc Tayinloan) £500,000 Start construction breakwater & aligning £10,000,000 Ongoing construction £1,000,000 Complete construction breakwater and aligning Fionnphort £500,000 New aligning structure: Construction £25,000,000 Ongoing construction Iona Ferry slip £10,000,000 Construction breakwater £5,000,000 Construction breakwater Dunoon Harbour £50,000 Scope of project greatly reduced. Budget to be reduced and minor works completed. Delay for Transport Scotland decision on vesel funding. £300,000 Upgrade works - to be determined Feolin Ferry slip TBC Installation of passenger access pontoon. Funding allocated from Crown Estates. Port Askaig £2,000,000 New Islay vessel enabling works Rothesay £3,500,000 Berthing face stab works £1,000,000 Round head capital works APPENDIX 1 - Marine Asset Management Plan £20,405,000Year Totals £23,450,000 £9,604,000 £45,500,000 £30,000,000 Page 11
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Classification: OFFICIAL# APPENDIX 2 - Piers & Harbours - Capital Projects Tracker Estimated overall project cost Spend to date Remaining budget FY 24/25 Forecast FY 25/26 Craignure Pier - Feasibility Study Ground investigation has completed on site. Awaiting final interpretation report to allow completion of OBC. SMILG meeting being organised. Marine *53,000 1,063 1,300 *2,000 Thi OBC element is on track Tayinloan & Gigha - Feasibility & Ground Investigation Consultants progressing Environmental Impact Assessments and design options ongoing and in process. Infrastructure Design *12,400 42 624 0 Budget estimate to be revised, awaiting further details Oban Municipal Port Project HRO progressing Marine 14 7 7 0 On track and 'in process' with Transport Scotland Campbeltown Old Quay - Wall A Active on site, work progressing Infrastructure Design 6,000 172 5,000 *1,000 On track Oban North Pier - Structural Assessment - PB Site works complete - awaiting final report Marine 9 2 7 0 On track Campbeltown New Quay - HPU Control panel and cylinder O/H Works on major commponents of the vital infrastructure Marine 100 0 100 0 On track Craignure - New PAS Design and Build Consultant supporting preparation on tender for new structure. Aiming to tender for new PAS in Q3 FY24/25. Result of this will inform on precise costs for a new PAS structure Marine *1,000 0 *1,000 0 On track Cuan Ferry Piers - OBC Development of outline business case for Cuan future infrastructure Marine *2,000 0 0 *2,000 Cost and delivery timescales currently estimated. To be updated Easdale Pier - OBC Development of outline business case for Easdale Pier future infrastructure Marine *1,000 0 0 *1,000 Cost and delivery timescales currently estimated. To be updated Ellenabeich Pier - OBC Development of outline business case for Ellenabeich Pier future infrastructure Marine *1,000 0 0 *1,000 Cost and delivery timescales currently estimated. To be updated Fionnphort - New Aligning Structure - Construction Small budget for FY24/25 reflects procurement of EIA study and subsequent application of neccessary licenses. Budget extending in future years to support construction of assets Infrastructure Design *25,500 50 500 *20,000 On track for delivery following Iona breakwater Iona Ferry Slip - Breakwater Construction Preferred Tenderer identified. Awaiting resolution with Marine Directorate before award of contract Marine & Infrastructure Design 15,000 3 10,000 5,000 Marine Directorate issue needs resolved. Contract not awarded, risk of losing preferred bidder. Rothesay - Berthing Face Stab Works Phase 2 live. Direct award prepared for Phase 3 Roundhead replacement Marine 4,500 196 3,500 *1,000 On track Port Askaig - New Islay Vessel Enabling Works Team is progressing a solution to enhance existing facilities. Under discusson with CFL and Transport Scotland. Marine *2,000 33 1,912 0 Costs depend on options progressed Dunoon Harbour - Essential Upgrade Works Scope of project greatly reduced. Budget to be reduced and minor works completed Marine *350 0 50 *300 Redefine scope and reduce budget accordingly. Timetable for new scope to be determined by Scottish Goverment decisions. Feolin Installation of a passenger only access at Feolin for periods when the vehicular vessel is not available. Marine TBC 0 to be updated 0 Not started, minor delay for design / fabrication completion Jura Ferry - Staff Housing Subject to Islands Programme funding application - will require immediate action if succesful Marine 80 0 80 Awaiting outcome of application likely Q3 Jura Ferry - New Vessel Concept Design Subject to Islands Programme funding application - will require immediate action if succesful Marine 300 0 300 Awaiting outcome of application likely Q3 * Beside a figure indicates an estimate - parts of the project not fully costed or confirmed at this stage Cost RAG rating Less that 10% overspend Between 10% and 50% overspend over 50% overspend Delivery RAG rating On time/target Not started/minor delay Unexpected issues Potential Projects - awaiting funding ResponsibleDetailsProject Name RAG Comment at August 2024Cost RAG Delivery RAG Costs (,000) Page 13
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