Agenda item

14.1

The Executive Director City Futures submitted a report seeking approval to secure Business Rate Retention (BRR) status for a c150ha area of land running from the City Centre to Meadowhall containing a number of sites that have the potential to increase the business rate take above the existing level (the Baseline), as outlined in this report.

14.2

RESOLVED UNANIMOUSLY: That Strategy and Resources Policy Committee:-

(a) approves the Council securing Business Rates Retention status in relation to the South Yorkshire Investment Zone (IZ), as set out in this report, noting the final details of the Business Rate Retention Area are to be agreed with the Director of Finance and Commercial Services in consultation with the Chief Executive and Leader of the Council, and subject to officers agreeing the pooling of any business rate growth in accordance with the below delegation; and

(b) delegates authority to the Director of Finance and Commercial Services in consultation with the Chief Executive and Leader of the Council to agree the pooling of any business rate growth.

14.3

Reasons for Decision

14.3.1

The underlying benefit that this proposal brings is the potential to secure long term additional funding to deliver a programme of economic activity in Sheffield and South Yorkshire that will grow the economy for the benefit of residents and business.

14.3.2

Both capital and revenue investments will be made over the 25-year period once positive business rate returns are achieved over the Baseline.

14.3.3

Investments will be made that:

• Provide for local economic growth within Sheffield and the region.

• Support existing local strategies with a focus on growth.

• Support the priority sector (Advanced Manufacturing) within the Investment Zone.

14.3.4

Whilst the principles of the BRR scheme have been provided by Government there remain points of detail to agree with Government and SYMCA in their role as Accountable Body for the IZ. This includes finalising the precise layout of IZ boundary, the agreeing the methodology to calculate the Baseline, the content of the BRR Investment Strategy and any requirements for pooling growth at a South Yorkshire level. These points of detail are to be delegated to the Director of Finance and Commercial Services in consultation with the Chief Executive and Leader of the Council.

14.4

Alternatives Considered and Rejected

14.4.1

A do-nothing option would leave the Council no worse off in that it would continue to secure any business rate growth above existing levels within the identified area but at the current rate of 49%. This income would become part of the General Fund and can be used without any restriction imposed through the IZ BRR scheme. However, the IZ BRR enables 100% retention of the business rate growth and the areas of spend considered acceptable within the scheme provide considerable flexibility to support projects and activity that the Council would likely fund without having IZ BR status.

14.4.2

Consideration has been given to including a wider area within the IZ BRR however expansion is not likely to capture any additional growth areas other than those which will likely include significant residential development. Consequently, the growth of such areas will be limited and may indeed see a net reduction in business rate income which will negatively impact on the overall position in relation to the BRR Baseline.

14.1

The Executive Director City Futures submitted a report seeking approval to secure Business Rate Retention (BRR) status for a c150ha area of land running from the City Centre to Meadowhall containing a number of sites that have the potential to increase the business rate take above the existing level (the Baseline), as outlined in this report.

14.2

RESOLVED UNANIMOUSLY: That Strategy and Resources Policy Committee:-

(a) approves the Council securing Business Rates Retention status in relation to the South Yorkshire Investment Zone (IZ), as set out in this report, noting the final details of the Business Rate Retention Area are to be agreed with the Director of Finance and Commercial Services in consultation with the Chief Executive and Leader of the Council, and subject to officers agreeing the pooling of any business rate growth in accordance with the below delegation; and

(b) delegates authority to the Director of Finance and Commercial Services in consultation with the Chief Executive and Leader of the Council to agree the pooling of any business rate growth.

14.3

Reasons for Decision

14.3.1

The underlying benefit that this proposal brings is the potential to secure long term additional funding to deliver a programme of economic activity in Sheffield and South Yorkshire that will grow the economy for the benefit of residents and business.

14.3.2

Both capital and revenue investments will be made over the 25-year period once positive business rate returns are achieved over the Baseline.

14.3.3

Investments will be made that:

• Provide for local economic growth within Sheffield and the region.

• Support existing local strategies with a focus on growth.

• Support the priority sector (Advanced Manufacturing) within the Investment Zone.

14.3.4

Whilst the principles of the BRR scheme have been provided by Government there remain points of detail to agree with Government and SYMCA in their role as Accountable Body for the IZ. This includes finalising the precise layout of IZ boundary, the agreeing the methodology to calculate the Baseline, the content of the BRR Investment Strategy and any requirements for pooling growth at a South Yorkshire level. These points of detail are to be delegated to the Director of Finance and Commercial Services in consultation with the Chief Executive and Leader of the Council.

14.4

Alternatives Considered and Rejected

14.4.1

A do-nothing option would leave the Council no worse off in that it would continue to secure any business rate growth above existing levels within the identified area but at the current rate of 49%. This income would become part of the General Fund and can be used without any restriction imposed through the IZ BRR scheme. However, the IZ BRR enables 100% retention of the business rate growth and the areas of spend considered acceptable within the scheme provide considerable flexibility to support projects and activity that the Council would likely fund without having IZ BR status.

14.4.2

Consideration has been given to including a wider area within the IZ BRR however expansion is not likely to capture any additional growth areas other than those which will likely include significant residential development. Consequently, the growth of such areas will be limited and may indeed see a net reduction in business rate income which will negatively impact on the overall position in relation to the BRR Baseline.