Agenda item

6.1

The Committee considered the decision of the Leader made on 30^th June 2015, relating to the proposed disposal of Walkley Library.

6.2

Signatories

The Lead Signatory to the call-in was Councillor Ben Curran and the other signatories were Councillors Olivia Blake, Neale Gibson, Geoff Smith and Lewis Dagnall.

6.3

Reasons for the Call-in

The signatories had confirmed that they wished to ensure that further scrutiny was undertaken on the Leader’s decision to sell Walkley Library.

6.4

Attendees

·           Councillor Isobel Bowler (Cabinet Member for Neighbourhoods)

·           David Hollis (Assistant Director of Legal and Governance)

·           Dave Wood (Interim Property Surveying Manager)

·           Nick Partridge (Libraries, Archives and Information Manager)

6.5

Councillor Ben Curran addressed the Committee as Lead Signatory, initially expressing his thanks and appreciation in terms of how quickly arrangements had been made for the call-in to be considered by the Committee, and to the Carnegie Walkley Library Group for the excellent work in operating the Library following the re-organisation in 2014.  He stated that there were mixed feelings in the community in terms of the proposed disposal of the Library building, and confirmed that there was nothing in the original deeds following the transfer of the building from Andrew Carnegie to the City Council, indicating that the Council could not dispose of the building.  He stated that he hoped that a number of questions and concerns raised by members of the public, particularly residents in Walkley, would be answered and alleviated, respectively, particularly relating to the levels of consultation, the best way forward in terms of protecting the library service in the area, and the future involvement of any other interested groups.  Councillor Curran concluded by expressing his concerns if members of the public had not received written responses to questions raised in connection with the review of library services in the City, at public meetings.

6.6

David Hollis stated that checks had been made of the original documents regarding the alleged sale of the library building by Andrew Carnegie to the Council, and confirmed that the Council had acquired the land from a third party and owned the freehold of the building with no restrictions attached. 

6.7

Questions from Members of the Committee

Members raised questions and the following responses were provided:-

·                The Business Plan process had been deemed to be transparent and correctly executed.

·                The Assessment Panel established to review all the bids received comprised Nick Partridge, Dave Wood, an officer from the Communities Portfolio and an officer responsible for dealing with grants, who therefore had experience of dealing with community groups.  The tests used by the Panel in connection with the assessment process, included viability and how the bids integrated community needs.

·                Considerable time and effort had been put in by all the groups and organisations who had submitted bids to run one of the 10 associate libraries, therefore it had been deemed not fair or suitable to bring in any new groups after all this work. 

·                The terms of the 125 year lease would give the Council first refusal to buy the whole building back if the freeholder ever decided to sell, meaning that whilst ever there was a group willing to run a library service, its future within the building would be secure.

·                As well as the Council’s and Kier’s valuations, the Council had also procured an independent third party valuation.

·                It was Forum Café Bars’ policy to own the freehold of a building it would be investing in, and this had been indicated in their bid.  Due to the condition of the building, it had been deemed critical to attract significant commercial investment. 

·                It was not clear as to why Forum Café Bars had offered above market value for the building, but by doing this, the company had demonstrated how serious they were in terms of their future plans.

·                If the Council wanted to buy back the building at any time in the future, the sale price would be determined by the market value at that time.

·                The future of the Library would be protected by a 125 year lease back to the Council.  The freehold would include both the building and the land.

·                Whilst it was difficult to assess the impact of the proposed development on other businesses in the area, the feedback received had indicated that local businesses largely supported the plans.

·                The Council had only been made aware that Forum Café Bars wished to purchase the freehold interest in the building when the Assessment Panel reconvened on 6^th August 2014, to review the clarifications received.  Given the level of investment required in connection with the renovation of the building, it had been decided that this would be the best option.  Council officers had also taken into consideration Forum Café Bars’ excellent business record.

·                All relevant protections had been written in as part of the conditions of the 125 year lease, including a condition stopping the landlord from using the property for reasons which are incompatible with a library service.

·                It was envisaged that the Council would look to achieve security of tenure in terms of the building on the expiration of the 125 year lease.

·                In terms of all the associate libraries, the Council was working closely with all the voluntary community groups running the libraries, with fortnightly meetings being held and training and advice provided to all the groups.  To date, all the 10 associate libraries remained open.

·                The lease would provide for Forum Café Bars to meet the full costs of all utilities and maintenance of the property for the first 21 years of the lease, thereby freeing Walkley Carnegie Library Group from the task of raising future funds for this purpose.  There would be provision for the lease to be surrendered to the landlord, in the event of there being no library groups willing and able to run the library service from the property.  Upon such a surrender, Forum Café Bars, or the then current owner, would pay an additional amount to the Council to reflect the value to them of having beneficial use of the library space.

·                As part of the process regarding expressions of interest, the offer of the sale of the freehold was not excluded at any time of the process, and it was up to the bidders to set out in their Business Plans, how they wanted to proceed.  Whilst it could not be confirmed, it was believed that there was no information in the submission documents relating to a requirement to purchase the freehold or leasehold interest.

·                The main aim of the Council had been to enable a library service to be run in all areas of the City where it could no longer run a service and so, had developed a model of associate and co-delivered libraries based on what had been done elsewhere, eg Doncaster, which would be community run.

·                Part of the library space would be totally separate from the licensed area, although the precise arrangements in terms of the layout was still to be decided.  The entrance to the current children’s library, where the library would operate, was totally separate. 

·                Although plans in terms of the library space had not yet been determined, the initial plans indicate that approximately one-third of the floor space would be exclusive library space, with another third of the floor space being shared – library space during the day and café/bar in the evenings.  Further discussions would be held on this issue and the final arrangements concluded only when all parties were happy.

·                Whilst it was not envisaged that there would be any major problems in terms of the planning application, if any issues were identified by the local Planning Authority, these would need to be fully addressed and, if necessary, the application would need to be resubmitted.

·                As part of the assessment of the original Business Plans, officers had looked at what library space would be required within the building.   The children’s library space was acceptable as a minimum size to run the proposed library from.  If the overall space currently designated as library space was not shared between the two parties, extra provision could be identified within the building as library space, which were presently not designated for library use.

·                The Council was satisfied that there was no instance of any Trust being established in this case. 

·                The decision in terms of the proposed disposal could not have been made under any existing delegations, and needed to be made by either the Cabinet or the Leader.  The decision was taken by the Leader on the basis that the Cabinet did not have a meeting arranged at the time.  Also, with the Cabinet not meeting in August, there would have been too much of a delay in terms of the decision being made, particularly in the light of possible call-in.  There was also concern that Forum Café Bars would not be prepared to accept further delays in waiting for the decision.

·                It was likely, under the new plans, for the library space to be kept separate from the licensed area.  The Council was confident that the new plans would be successful, and create a vibrant and interesting project, as well as being commercially viable.  Arrangements between Forum Café Bars and the Carnegie Walkley Library Group have been developing very positively.

·                As part of the Business Planning process, the Assessment Panel was given the opportunity to look at all plans submitted to the Council, based on an agreed criteria.  The Panel was particularly interested in a long-term viability, as well as a sustainable plan for the recruitment and training of volunteers who would be running the library service.  The Panel held a preliminary session to see if the parties met the agreed threshold, then reconvened to raise any further queries it had in terms of the bids. 

·                The building was not compliant with the requirements of the Equalities Act as regards disability access at the present time, and there were a number of other challenges in terms of its condition.  There was no funding identified in the Council’s budget to address such issues.

·                The relationship, as part of the future arrangements, would predominantly be between Forum Café Bars and the Carnegie Walkley Library Group, with the Council providing ongoing advice and assistance to the Library Group.

·                Forum Café Bars were looking to invest heavily in terms of the refurbishment of the building, in the region of between £300,000 and £500,0000 and therefore, it had been necessary to sell the company the freehold in order for them to secure such funding. 

·                It had been considered that, by careful negotiation with Forum Café Bars, the period of 21 years, in respect of the surrender of the maintenance and utility costs being met by Forum Café Bars, represented a very good deal for the Council.  It was not possible to extend the period beyond this term.

6.8

RESOLVED: That the Committee:-

(a)       notes the contents of the report now submitted, together with the comments now made and the responses to the questions raised; and

(b)       agrees to take no action in relation to the called-in decision, but considers that the issue regarding library services in the City in general, be added to the Work Programme 2015/16.

(NOTE: Prior to the passing of the above resolution, an alternative motion was moved by Councillor Robert Murphy and seconded by Councillor Ian Auckland, in the following form, was put to the vote and negatived:-

“That this Committee requests that the decision be deferred until the Scrutiny Committee has considered relevant issues and made recommendations to the Executive on the grounds that the Leader’s report does not contain alternative options, specifically relating to the lease of the building to other community groups in Walkley and/or putting the building on the open market”).