Decision details

Purpose of report: To inform Members of some of the specific financial implications of the administrative accommodation project

Members are asked to: Approve the accounting implications of the abortive costs associated with the administrative accommodation project, following the decision not to develop the site at Hungate (b) the current funding position of the project and (c) removal of the “land assembly Hungate” costs from the £43.8m administrative accommodation project budget.

RESOLVED: (i) That it be noted that the abortive costs of £1.092m included in the overall Administrative Accommodation budget of £43.804m have been written off directly to the Income and Expenditure Account and funded from reserves as part of the preparation of he 2008/09 Statement of Accounts, but will remain within the total budget allocation of £43.804m.

(ii) That the overall funding of the Administrative Accommodation project, which is estimated to use a combination of capital receipts, reserves and borrowing as the sources of funding used to support the £43.804m budget, be noted.

                        (ii)        That it be noted that the overall funding position will continue to fluctuate in relation to the timing and value of capital receipts and will impact upon borrowing accordingly, and that the project remains viable in accordance with the affordability indicators, with the NPV savings remaining positive and the Venture Fund revenue reserve being sufficient to cover the early years revenue deficit and the abortive costs paid to date (paragraphs 25-27 of the report refer).

                        (iii)       That it be noted that the £2.2m costs of relocating the Peasholme Hostel include the costs of betterment, that this element should not be accounted for as part of the Hungate land assembly costs, and that Officers be requested to table a statement indicating both the revenue and capital implications of this improvement in Social Services provision.

REASON:      To ensure that Members are kept informed of the funding position on this major project and to ensure that the accounting position is correctly recorded.