Agenda item

With reference to the minute of meeting of the Committee of 26 November, 2009 (Article 11 refers), there had been circulated a report by the Director of Enterprise, Planning and Infrastructure providing an account of the most recent progress made towards the establishment of the Aberdeen Business Improvement District (BID) and outlining anticipated commitments from existing budgets and resources.  

A Business Improvement District was a partnership between a local authority and the local business community established with the objective of developing and implementing projects services to benefit the trading environment within the commercial area in question.   Aberdeen BID operated through a private company limited by guarantee with no share capital (Company No. SC352258) in the light of the Council’s approval of this company’s formation (see Minutes of Meetings of the Council on 13 August, 2008 – Article 12 refers).   The Board of Directors consisted of the Director, Councillor Kevin Stewart, John Michie of Aberdeen City Centre Association and Barry Matheson, the Managing Director of John Lewis Aberdeen and Edinburgh.

The Board of Directors was advised by a Steering Group partnership consisting of a majority of representatives drawn from the local business community and a limited number of senior officers from Aberdeen City Council.

The Steering Group’s function was to provide advice and guidance to a BID development team during the developmental stages of the project up to and beyond the ballot point (the Planning Etc. (Scotland) Act 2006 – Part 9 : Business Improvement Districts – gave the Council a power of veto over a BID proposal, which effectively determined whether or not a ballot was held.  

The Council was required to submit such a proposal within a prescribed period (70 days) and give notice that it would or would not veto it.   If exercising a veto, the local authority was bound to set out the reason for so doing, and to give details of the right of appeal.  If the authority did not intend to exercise a veto, it was again bound to set out its reasons.  

In the present case, upon receipt of the BID proposal document, the Committee would be asked to consider it in terms of these powers.   Other statutory deadlines included a requirement for Aberdeen BID Development Company to notify the Council of its intention to go to ballot (not less 154 days), the submission of a BID proposal document (not less than 98 days), the option to go to veto (not less than 70 days), and the request to hold a ballot (not less than 56 days).

The Energising Aberdeen Board of 26 March, 2008 had approved the award of £200,000 (subject to a £15,000 clawback provision in the event of Aberdeen BID Development Company securing additional funding from the Scottish Government) and the overall funding requirement was supported by evidence from other BID projects throughout Scotland that suggested that total funding in excess of this amount was generally required to take such projects up to the point of ballot.

At the time, it had been known that this level of funding was not considered sufficient for this purpose, and that additional funding would be needed to meet the objective.  Whilst the initial funding allocation had not yet been fully exhausted, Aberdeen City Council had identified further support, both in terms of staff and also in terms of monies up to a maximum of £200,000 from the Enterprise, Planning and  Infrastructure Directorate Budget allocated towards the City Development Company project to meet the anticipated current and future requirements of the BID.   Accordingly, financial resources would be transferred from Aberdeen City Council to Aberdeen BID Development Company subject to the achievement of specified performance deliverables and under the authority and approval of the Director for Enterprise, Planning and Infrastructure.

It had been identified that £1.5m would be required for the first three years’ operating costs of the City Development Company, and a total of £1.9m had been allocated leaving a balance of £400,000 which was proposed to fund the BID (together with a separate project).

In this respect, it had been identified that the Aberdeen BID Development Company would require to be provided with some assistance with cash flow, as there would be various activities that the Company would wish to undertake early in its life, before the proceeds of the BID levy collection had been passed from the Council to the BID Company.   The proposed financial allocation of £200,000 from Enterprise, Planning and Infrastructure Directorate - relating to money allocated to the South of the City Regeneration Company and now transferred to the City Development Company – would cover this requirement in the event that a successful ballot was realised, as well as operational expenses in the lead up to this event.

The Committee resolved:-

(i)         to note the progress made towards the establishment of an Aberdeen BID;  and

(ii)        to approve the proposed financial transfer of £200,000 from the Enterprise, Planning and Infrastructure Directorate’s Budget to Aberdeen Business Improvement District Company Limited, subject to agreed performance outcomes.