Agenda item

8.1

To set out a proposal to review the service charge recharged to traders at the Moor Market and the reasons why officers consider this needs to be implemented.

8.2

RESOLVED UNANIMOUSLY: That the Waste and Street Scene Policy Committee:

1.     approves an increase to the service charge currently charged to market traders of CPI+8% (an increase of 14.8%);

2.     approves a period of 12 weeks from the decision being taken to the implementation of the new service charge; and

3.     agrees that further service charge reviews should take place annually for officers to make proposals to the Committee for moving towards full cost recovery or if necessary, proposals will be brought to maintain the service charge at that rate at the time of the report or reduce the service charge.

8.3

Reasons for Decision

8.3.1

The option outlined in scenario 5 (CPI+8%) provides a reasonable increase to the service charge that enables the Council to move towards full cost recovery whilst allowing time to assess the impact of the increase on traders, given that the service charge has not been increased in a number of years.

8.3.2

The Market Traders provide a valuable service and a service charge above CPI+8% may impact on occupancy levels or result in costs being passed on to customers.

8.4

Alternatives Considered and Rejected

8.4.1

The option to do nothing (scenario 1) has been rejected by officers due to the unsustainable nature of the increasing subsidy required on operational costs.

8.4.2

The option to move straight to full cost recovery (scenario 9) will be too much of an impact on the tenants. It’s likely to create significant cost pressures that are too large to pass straight on to customers and may increase the markets vacancy rate, which will negatively financially impact the budgets for service charges and rents. Overall, it could undermine the financial position rather than improve it.

8.4.3

Other models of recharging the service charge such as a service charge only tenancy agreement are options that require further work that has not been possible to complete in time to consider for this paper.

8.1

The Interim Operations Manager City Centre Maintenance and Sheffield Markets and Head of Street Scene Services presented a report that set out a proposal to review the service charge recharged to traders at the Moor Market and the reasons why officers considered that this needed to be implemented.

8.2

RESOLVED UNANIMOUSLY: That the Waste and Street Scene Policy Committee:

1.     approves an increase to the service charge currently charged to market traders of CPI+8% (an increase of 14.8%);

2.     approves a period of 12 weeks from the decision being taken to the implementation of the new service charge; and

3.     agrees that further service charge reviews should take place annually for officers to make proposals to the Committee for moving towards full cost recovery or if necessary, proposals will be brought to maintain the service charge at that rate at the time of the report or reduce the service charge.

8.3

Reasons for Decision

8.3.1

The option outlined in scenario 5 (CPI+8%) provides a reasonable increase to the service charge that enables the Council to move towards full cost recovery whilst allowing time to assess the impact of the increase on traders, given that the service charge has not been increased in a number of years.

8.3.2

The Market Traders provide a valuable service and a service charge above CPI+8% may impact on occupancy levels or result in costs being passed on to customers.

8.4

Alternatives Considered and Rejected

8.4.1

The option to do nothing (scenario 1) has been rejected by officers due to the unsustainable nature of the increasing subsidy required on operational costs.

8.4.2

The option to move straight to full cost recovery (scenario 9) will be too much of an impact on the tenants. It’s likely to create significant cost pressures that are too large to pass straight on to customers and may increase the markets vacancy rate, which will negatively financially impact the budgets for service charges and rents. Overall, it could undermine the financial position rather than improve it.

8.4.3

Other models of recharging the service charge such as a service charge only tenancy agreement are options that require further work that has not been possible to complete in time to consider for this paper.