Agenda, decisions and minutes

Apologies for absence were received from Councillors Sleigh, Bird, O’ Boyle and Simkins and Sue Summers (West Midlands Development Capital).

Councillor Bird had nominated Councillor Andrew to attend the meeting on his behalf.

Councillor Sleigh had nominated Councillor Courts to attend the meeting on his behalf.

Agreed.

The minutes of the meeting held on 24 July 2023 were agreed as a true record.

1.    The two commercial Investment Fund loans approved by the Chief Executive of the WMCA due to the previous Investment Board not being quorate and the urgent commercial imperative to make such a decision, as detailed in Section 3 of the report be noted;

2.    The WMCA Investment Programme funding status and current affordable limit as outlined in Section 4 of the report be noted and

3.    The Regional Investment Programme delivery update detailed within this report and appendices (including the project-level summary within the WMCA Investment Programme dashboard at Appendix 2 of the report) be noted.

The board considered a report of the Director of Commercial and Investment on the status of the Investment Programme to help set the context for the Investment decisions being made.

The report provided an analysis of the overall regional Investment

Programme expenditure, funded grants administered by the WMCA and

Match funding sources. Approved grant funding awarded and administered by the WMCA to programmes within the regional Investment Programme totals £835.7m as of 30 September 2023.

It was noted that two applications from the Commercial Investment Fund

were approved since the last quorate meeting of the Investment Board on 24 July due to the need for commercial expediency. These were:

Westbeech Developments (Westminster Industrial Estate) and Chancerygate (GKN Site, Erdington).

Resolved that:

1.    The two commercial Investment Fund loans approved by the Chief Executive of the WMCA due to the previous Investment Board not being quorate and the urgent commercial imperative to make such a decision, as detailed in Section 3 of the report be noted;

2.    The WMCA Investment Programme funding status and current affordable limit as outlined in Section 4 of the report be noted and

3.    The Regional Investment Programme delivery update detailed within this report and appendices (including the project-level summary within the WMCA Investment Programme dashboard at Appendix 2 of the report) be noted.

Noted.

The board considered a report detailing the Commercial Investment Fund dashboard (public iteration) as at 1 October 2023.

Resolved : That the report be noted.

Noted.

The board considered a report detailing the Brownfield Land and Property Development Fund (public iteration) as at 1 October 2023.

Resolved: That the report be noted.

Noted.

The board considered a report detailing the Residential Investment Fund dashboard (public iteration) as at 1 October 2023.

Resolved: That the report be noted.

1.    The release of £12.2m of West Midlands Combined Authority funding to West Midlands Growth Company (WMGC) over the next two years to 31 March 2025 be approved. This is comprised of:

a.    £9.9m from the Commonwealth Games Legacy Enhancement Fund allocation, from the total £14.1m agreed by the WMCA Board in March 2023, of which £2.5m was agreed by the Investment Board at the Strategic Outline Case stage:

i.£1.8m which has been utilised by WMGC in order to develop the Full Business Case and to begin delivery against the local and regional priorities in the Programme in Quarters 1 and 2 of 2023/24 and

ii. £0.7m which has been granted to local authorities from the WMCA to support an increase in capacity to deliver against priorities in the programme.

b.    £1.6m of UK Shared Prosperity Funding for 2024/25 with the same amount previously released for 2023/24 by the WMCA Board on 16 December 2022.

c.    £0.7m of WMCA core funding for 2024/25, with the same amount previously released for 2023/24 by the WMCA Board on 16 December 2022.

2.         The appended Full Business Case and the total budget of £22.5m

which includes all funding requesting in this report and approved at previous boards be noted and allocated as follows:

a.£21.8m for the West Midlands Growth Company with the WMCA 

            providing £18m and the remaining £3.8m from commercial and other

            funding leveraged by the WMGC;

3.     The WMGC funding will enable the delivery of WMGC’s Business Plan 2023-25 which was agreed by the Economic Growth Board in July 2023 and is comprised of the following:

-       £14.1m from the Commonwealth Games Legacy Enhancement Fund, of which £0.7m has been granted to local authorities from the WMCA to support an increase in capacity to deliver against priorities in the programme, with the balance of £13.4m for WMGC

-       £3.2m from the UK Shared Prosperity Fund

-       £1.4m from the WMCA core budget

4.    The balance of WMGC budget is comprised of £3.8m of commercial and other funding leveraged by the WMGC be noted;

5.    The WMGC’s Business Plan 2023-2025 that was approved by the Economic Growth Board on 12 July 2023 be noted and

6.    Agreed that Investment Board receive a 6 monthly update report on the Global West Midlands Programme.

The board considered a report of the Executive Director of Strategy, Integration and Net Zero, that sought approval of funding for the full business case for Global West Midlands.

The full business case outlined how West Midlands Growth Company would work in partnership with the WMCA, local authorities and other partners to build on the pipeline of leads from the Birmingham Commonwealth Games Business and Tourism Programme, run a full programme of international promotion in key markets identified in the West Midlands International Strategy and deliver the Global West Midlands Programme.

The Chief Executive of West Midlands Growth Company, Neil Rami, highlighted key aspects from the report.

In relation to the monitoring and reporting of the Global West Midlands programme to Investment Board, the Chair asked that a six- monthly update be provided.

Resolved that:

1. The release of £12.2m of West Midlands Combined Authority funding to West Midlands Growth Company (WMGC) over the next two years to 31 March 2025 be approved. This is comprised of:

a.    £9.9m from the Commonwealth Games Legacy Enhancement Fund allocation, from the total £14.1m agreed by the WMCA Board in March 2023, of which £2.5m was agreed by the Investment Board at the Strategic Outline Case stage:

i.£1.8m which has been utilised by WMGC in order to develop the Full Business Case and to begin delivery against the local and regional priorities in the Programme in Quarters 1 and 2 of 2023/24 and

ii. £0.7m which has been granted to local authorities from the WMCA to support an increase in capacity to deliver against priorities in the programme.

b.    £1.6m of UK Shared Prosperity Funding for 2024/25 with the same amount previously released for 2023/24 by the WMCA Board on 16 December 2022.

c.    £0.7m of WMCA core funding for 2024/25, with the same amount previously released for 2023/24 by the WMCA Board on 16 December 2022.

2.     The appended Full Business Case and the total budget of £22.5m

which includes all funding requesting in this report and approved at previous boards be noted and allocated as follows:

 £21.8m for the West Midlands Growth Company with the WMCA 

            providing £18m and the remaining £3.8m from commercial and other

            funding leveraged by the WMGC;

3.    The WMGC funding will enable the delivery of WMGC’s Business Plan 2023-25 which was agreed by the Economic Growth Board in July 2023 and is comprised of the following:

-       £14.1m from the Commonwealth Games Legacy Enhancement Fund, of which £0.7m has been granted to local authorities from the WMCA to support an increase in capacity to deliver against priorities in the programme, with the balance of £13.4m for WMGC

-       £3.2m from the UK Shared Prosperity Fund

-       £1.4m from the WMCA core budget

4.    The balance of WMGC budget is comprised of £3.8m of commercial and other funding leveraged by the WMGC be noted;

5.    The WMGC’s Business Plan 2023-2025 that was approved by the Economic Growth Board on 12 July 2023 be noted and

6.    Agreed  ...  view the full minutes text for item 51.

1.    The Sandwell Aquatic Centre Energy Cost uplift Business Justification Case for a maximum grant of £1,395,754 funded by the Commonwealth Games Legacy Enhancement Fund and subject to the terms and conditions of the funding agreement in place between DCMS and the WMCA and additional clawback clauses if there is an additional expected underspend be approved;

2.    The release of £604,246 on the back of the previous March 2023 WMCA Board Commonwealth Games Legacy Enhancement Fund (CWGLEF) allocation be approved (such changes are in line with the WMCA’s change control process, enabled by the Single Assurance Framework and signed off by the relevant boards of the WMCA and the change control process confirms that any underspends that emerge from the CWGLEF, are directed first towards the regional Plan for Growth or Community Grants programmes) be approved;

3.    Subject to the approval of this investment, the WMCA pays a grant, quarterly in arrears, to Sandwell MBC from October 2023 based on monthly monitoring reports on actual spend and any additional underspends identified by 30 April 2024 be directed in line with the WMCA’s change control process first towards the regional Plan for Growth or Community Grants programme be noted and

4.    Sandwell MBC funds £515,323 of the energy costs and any overspend above the forecast of £1,911,077 be noted.

The board considered a report of the Interim Director of Employment, Skills

and Communities that sought approval of the Business Justification Case

for the Sandwell Aquatic Centre Energy Costs from the Commonwealth

Games Legacy Enhancement Fund. It was noted that it was agreed by the

WMCA Board that all business justification cases funded from the

Commonwealth Games Legacy Enhancement Fund would be submitted to

Investment Board for approval.

The Assistant Director Borough Economy (Sandwell), Ben Percival,

 outlined the report and advised the board of the need for financial

 support from the WMCA due to the unprecedented rise in energy costs

 which posed significant challenges to the planned successful operation of

 the centre which was of regional importance.

 He added that financial support was only being requested for the actual

 cost pressures and any underspends would result in undrawn funds that

 would be directed towards the regional Plan for Growth or Community

 Grants programme as set out in the WMCA Board report of 17 March 2023.

 Councillor Courts reported that the WMCA Board strongly supports the

 facility but noted that the target objectives in the business case do not refer

 to the centre being a regional facility.

The Head of Health & Communities, Mubasshir Ajaz, reported that the

facility was for the betterment of the region and agreed for the need to

publicise it across the West Midlands.

The Assistant Director Borough Economy (Sandwell), Ben Percival,

reported that from the 46 schools using the facility, 11 schools were non-

Sandwell and advised that regional swimming events have been booked.

Also, it was hoped the national diving competition and other major swimming

events could be hosted at the venue. In relation to the business case not

referencing the facility as a regional one, it was noted that this was not

included as it would impact the modelling; if the funding was not available,

other centres would need to close rather than the Aquatic Centre.

In relation to an enquiry from Councillor Dormer regarding the 46 schools

using the facility and where these came from, Ben Percival undertook to

look into the matter.

      Councillor Andrew considered it was vitally important that regional events

      could be hosted at the Aquatic Centre and enquired whether the facility had

      adversely impacted other swimming facilities, the Assistant Director

      Borough Economy (Sandwell), reported that the detrimental impact was not

      being tracked but facilities had been closed at Langley and Smethwick

      when the Aquatic Centre opened. The modelling with Sports England

      indicated the facility fulfils existing demand not over demand.

      The Chair asked that changes in the demand and usage of the Aquatic

      Centre be tracked.

       Resolved that:

1.    The Sandwell Aquatic Centre Energy Cost uplift Business Justification Case for a maximum grant of £1,395,754 funded by the Commonwealth Games Legacy Enhancement Fund and subject to the terms and conditions of the funding agreement in place between DCMS and the WMCA and additional clawback clauses if there is an additional expected underspend be approved;

2.    The release of £604,246 on  ...  view the full minutes text for item 52.

[To pass the following resolution:

That in accordance with Section 100A4 of the

Local Government Act 1972, the press and

public be excluded from the meeting during the

consideration of the following items of business

as they involve the likely disclosure of exempt

information relating to the business affairs of any

particular person (Including the authority holding

that information)]

That in accordance with Section 100A4 of the Local Government Act 1972, the press and the public be excluded from the meeting during the consideration of the following items of business as they involve the likely disclosure of exempt information relating to the business affairs  of any particular person(including the authority holding that information).

Resolved:

That in accordance with Section 100A4 of the Local Government Act 1972, the press and the public be excluded from the meeting during the consideration of the following items of business as they involve the likely disclosure of exempt information relating to the business affairs  of any particular person(including the authority holding that information).

1.    The powers and ability of the WMCA to make the proposed loan be noted;

2.    The loan investment from the Commercial Investment Fund for the amount specified in the report, to the ‘Company’ for a term of 5 years on the terms and conditions set out in the report be approved;

3.    Authority be delegated to the Director of Commercial and Investment in consultation with the Section 151 Officer and Monitoring Officer to negotiate any other terms and conditions of the loan that are not set out in the report be agreed and

4.    Authority be delegated to the Director of Commercial and Investment to exercise the rights granted to the WMCA under the terms of the loan to authorise the ‘Company’ on such terms as shall be considered appropriate to either (i) transfer any part of the development site, and/or (ii) grant any lease, easement, wayleave or other instrument in each case to either (a) any utility company and/or (b) any local authority in the exercise of its planning highway functions and (c) any third party in the discharge of any planning obligation be agreed.

The board considered a report of West Midlands Development Capital

(WMDC) that sought approval for loan funding from the Commercial

Investment Fund for the sum specified in the report, to the ‘Company’, to

assist with the purchase of the Southside Building enabling the

refurbishment of the space at the ‘Property’.

The loan would enable the ’Company’ to undertake refurbishment works to

elements of the ‘Property’ which have yet to be refurbished with the main

aim being to provide further space to arts and culture businesses/individuals

on flexible and minimal cost rents/terms.

The key terms were highlighted in section of 3 of the report and the loan

would be fully secured by way of first charge over the property.

The Director of Commercial and Investment, Ian Martin, reported that he

was supportive of the loan which was not a long-term debt and was less

than £100 per square foot. He noted that the report confirmed that WMDC

had spoken with the Borrower, and it was understood that the loan

was facilitating purchase and development readiness with no expectation of

the loan continuing after this initial term

Resolved that:

1.    The powers and ability of the WMCA to make the proposed loan be noted;

2.    The loan investment from the Commercial Investment Fund for the amount specified in the report, to the ‘Company’ for a term of 5 years on the terms and conditions set out in the report be approved;

3.    Authority be delegated to the Director of Commercial and Investment in consultation with the Section 151 Officer and Monitoring Officer to negotiate any other terms and conditions of the loan that are not set out in the report be agreed and

4.    Authority be delegated to the Director of Commercial and Investment to exercise the rights granted to the WMCA under the terms of the loan to authorise the ‘Company’ on such terms as shall be considered appropriate to either (i) transfer any part of the development site, and/or (ii) grant any lease, easement, wayleave or other instrument in each case to either (a) any utility company and/or (b) any local authority in the exercise of its planning highway functions and (c) any third party in the discharge of any planning obligation be agreed.

The board noted that the grant funding agreement has lapsed and agreed that it was up to Birmingham City Council whether the Council wanted to submit a new (full) application for funding for the scheme from the Brownfield Land & Property Development Fund.

Further to the report considered by the board on 17 April 2023, the board received an update report from West Midlands Development Capital (WMDC) on the current position regarding £4.386m land remediation grant allocation (alongside matching request from HCA’s Birmingham City Deal Programme) in respect of a contaminated site (former sewage works) with additional exceptional remediation and infrastructure costs to ultimately deliver 298 homes at the location at Shard End.

At the meeting on 17 April 2023, Investment Board agreed for the grant to be further extended and ring-fenced to Birmingham City Council until 31 August 2023, subject to 5 pre-conditions being met.

The board noted that the grant agreement had lapsed and whilst Birmingham City Council had made progress with the developer for a planned start on site before Christmas, there was no written confirmation from the Environment Agency on the proposed further revised remediation strategy and the resultant tax liability and the scheme would be undertaken at Birmingham’s risk.

Gerald Ganaway (WMDC) reported that the Brownfield Land & Property Development Fund was oversubscribed, and the funding allocated to Birmingham for this scheme could be reallocated to other commercial schemes that require grant funding and are in a position to be delivered.

The Director of Commercial and Investment, Ian Martin, advised the board that there was no other WMCA funding Birmingham could apply for as the project did not meet the required intervention rate for housing under existing funds.

The board considered that it was unlikely Birmingham would receive a full review of the site from the Environment Agency within the next 4 weeks and Birmingham should therefore submit a new application (if they wished) for funding given the grant agreement (approved in October 2017) had lapsed.

Resolved that:

Birmingham City Council be advised the grant funding agreement for Yardley Brook, Shard End has expired, and BCC be invited to submit a new (full) application for funding be agreed.

Noted.

The board considered a report detailing the Commercial Investment Fund dashboard (private iteration) as at 1 October 2023.

Nick Oakley, West Midlands Development Capital (WMDC) provided an update on ‘live’ schemes and informed the board that the Barbarry scheme had fallen away.

Resolved: That the report be noted.

Noted.

The board considered a report detailing the Brownfield Land and Property Development Fund (private Iteration) as at 1 October 2023.

Nick Oakley (WMDC) reported that the Mira Technology scheme draw later this month.

Resolved: That the report be noted.

Noted.

The board considered a report detailing the Residential Fund dashboard (private iteration) as at 1 October 2023.

Nick Oakley (WMDC) reported that Urban Splash – Port Loop scheme would draw later this month.

In relation to an enquiry from Gary Taylor (Greater Birmingham & Solihull LEP) as to when the board could expect to receive a disposal strategy for housing, the Executive Director of Finance & Business Hub, Linda Horne, reported that a full update on the three housing and land funds would be submitted to the next meeting.

Resolved: That the report be noted

Noted.

The board considered a report detailing the Land and Property Investment Fund as at 4 October 2023.

Resolved: That the report be noted.