SAVE OLD SCHOOL:
Group Meeting in the Rose & Crown, Ivinghoe,
July 2nd 2012 at 8.00pm
BCC feedback questions on May 2012 Business Plan (CT in chair)
Welcome to all SOS interested parties! Minutes, Apologies.
1 Update Nigel on SOS news for Beacon Magazine article due in.
2 BCC Finance have reviewed the stage 2 bid document for the Business Investment Group (BIG) and require the following clarifications before it is presented to BIG. If we want to make the 26 July BIG meeting, Jackie Wesley believes we would need to get the updated information back by 10-12 July. Where they have phrased questions they would expect the answers to be addressed within the business case, not necessarily listed for instance, as an appendix:
· Provide evidence of the £3,600 rent paid by Ivinghoe Parish Council. We have £5,500 listed in our documents as the last lease amount paid.
· Due to the nature of a number of the structural works required is it likely that the building will not be available wholly for the entire rental income period? What is the likelihood of the works being completed and funding being secured before the start date of your financial model January 2013 for either the Council or yourselves? If the work is spread over a specified period, e.g. 5 years, rather than carried out at the start will this have a different impact on rental income? How will this be dealt with as the financial models in the business case already indicate a deficit? (The request to demonstrate how SOS would achieve funding and work around the necessary structural works as outlined in bullet point two, JW believes, relates mainly to the request from BCC relating to the potential option for model 5.)
· There is no sensitivity modelling to take into account inflation. The financial models indicate that rental income will be fixed with expenditure remaining at the same levels. Whilst the long term intention is to have the two businesses have their utilities individually metered, what is the contingency plan in the meantime if costs such as these increase? Is the intention to increase rental income? How will inflation be dealt with generally?
· In section 3 annual income from rent is expected to be £16,350 p.a. plus £1,200 p.a. from additional community use and fundraising. The financial model indicates £15k p.a. for rental income, £18.8k for recharges and £1,350 for other income. Why is there a difference? The impact of this difference could affect the deficit/loss.
· What will be the impact if funding cannot be secured for the building works? What is the contingency plan?
· What is the contingency plan to address deficits identified in the financial models?
· In section 6 there are start-up costs of around £80k which includes £54,200 for building costs. Can you confirm that the £54,200 is in addition to the estimated £145,850 indicated for building works in the survey provided by property?
· Also, there are start-up costs relating to the businesses that will be renting space at the building. Will these amounts e.g. for the kitchen, costume storage be recharged to these businesses or is the Community Group incurring these costs?
· One of the proposed funding streams from the Architectural Heritage Fund includes low interest loans. How will the interest expenditure be covered? There isn’t a provision in the financial model.
· Within the environmental policy a ‘safe cycle’ storage in mentioned, what is the cost and where is it shown?
· Will the volunteers be paying for their own training or CRB checks if required?
· Review the calculations in the financial models, for instance some of the totals do not add up, e.g. total spend in option A, year 1 is shown as £17,540 but is actually circa £32k.
· The computer equipment is stated as £1,600 in section 6 but appears as £16k in the financial model. Is this a typo?
· When is the group expecting to break even? Even with removing the rental charge to BCC the financial models highlight a loss.
· What is the maintenance cost made up of? What is the basis of reducing the maintenance spend in years 2-5 in option B?
· What are the revised timelines? A number of the deadlines in the gant chart have been missed.
With regards to the financial models we will require the models as per the original advice dated 26th January (email) and 27th January (letter), plus the preferred option mention in the second paragraph in the executive summary in the business case. I have specified below the request:
1. 25 year lease with rent indicated at £5,500 p.a. with the Council first putting the building in good order and all maintenance responsibilities being transferred to the Community Group (as originally specified)
2. 25 year lease with rent indicated at £5,500 p.a. with the Community Group having internal/limited maintenance responsibilities and the Council retaining structural maintenance responsibilities only (as originally specified)
3. 25 year lease with rent indicated at £0 p.a. for an initial period to be agreed with the Council first putting the building in good order and all maintenance responsibilities being transferred to the Community Group (as originally specified)
4. 25 year lease with rent indicated at £0 p.a. for an initial period to be agreed with the Community Group having internal/limited maintenance responsibilities and the Council retaining structural maintenance responsibilities only (as originally specified)
5. Leasehold at £1 p.a. for all years with the potential for a freehold option later and full maintenance responsibilities (including structural) as the building currently stands passed over to the community group
What happens if the value of the property increases??? Funds for purchase
Project Support Officer
Centre of Expertise – Projects and Commercial Accountancy
Finance and Commercial Services
Next meeting to be arranged as needed.