Archived decisions

Hampshire Fire and Rescue Authority

Error! Bookmark not defined.Finance and General Purposes Committee Item 7

26 October 2006

Error! Bookmark not defined.Asset Management Working Group meeting 16 October 2006

Report by the Chief Officer

Contact: David Howells, Director of Corporate Services Tel: 023 8062 6833

1

Introduction

1.1

The Asset Management Working Group met on 16 October 2006 and Cllrs: Hutcheson (Chairman), House and Price, attended. Apologies for absence were received from Cllrs: Horne and Woodhall. The officers and advisers in attendance were: David Howells (Director of Corporate Services), Richard Kenchington (Property Services, HCC), Jane Lovett (representing the Treasurer), Kevin McArdle (Property Services, HCC), Graham Starke (Property Services Manager, HFRS), Keith Whitehead (Property Services, HCC).

1.2

A number of items were discussed and these are summarised below together with recommendations to this Committee where appropriate.

2

Recommendations

That it be a recommendation to the Authority:

2.1.1

That provision be made in the Authority's capital programme (2006/07 starts) for a scheme [`Headquarters Development: Phase 2'] to provide a new vehicle workshops building at the Headquarters site, Eastleigh at an estimated total capital cost of £4m; and

2..1.2

That approval be given to let a contract using the South East Centre of Excellence (SECE) Project Framework Agreement for the construction of the new building, plant and equipment to Brazier Construction (a division of Kier Regional Limited) at a cost not exceeding £3.7m.

2.2

That when houses (listed in paragraph 4.2 of this report) - which are currently associated with supporting the operation of day-crewed duty system at Andover, Winchester and Havant - become surplus to operational requirements they should be immediately disposed of in accordance with the Authority's housing disposal policy; and that progress on such disposals be reported to future meetings of the Asset Management Working Group and the Finance and General Purposes Committee.

2.3

That provision be made in the Authority's capital programme at a current estimated cost of £650,000 to cover the cost of necessary building works associated with changing to a shift-crewing duty system at Andover, Winchester and Havant Fire Stations; but that the officers continue to explore options that would reduce the cost of the works at the existing Winchester Fire Station given that only a short-term solution may be necessary if the Authority eventually agrees to redevelop the Station at the current vehicle workshops site.

3

Headquarters Development Phase II: provision of new vehicle workshops: project appraisal

3.1

A draft version of the project appraisal (included as an item on the Committee's agenda) was presented for consideration. The discussion focussed on the alternative option to rent a suitable industrial unit in the Eastleigh area for the relocation of vehicle workshops rather than construct a new building on the Headquarters site. It was acknowledged that several important assumptions had to be made to provide a meaningful comparison of the relative costs and benefits of the two options: these included potential scale of rental discount for a long-term commitment, the likely increase in rent over a long-term, the likely cost of restoring a rented building to its original condition following occupation, and the estimated value of land at Headquarters that might be released. As a result of the useful discussion, the officers undertook to check the calculations in the discounted cash-flow exercise but it was felt any amendment would be unlikely to change the conclusion that the new-build option is preferred.

3.2

The Group concluded that the rental option was, on balance, less attractive in that the financial risks were perceived to be higher (particularly because of the uncertainties about future rental costs) and the relatively high cost of capital investment still required to install the specialist plant and equipment. Concerns about security were also expressed - the view being taken that this might be compromised on a shared site. Members were mindful that the potential for Workshops personnel to undertake retained firefighter based at the Headquarters site would be lost.

3.3

Taking all these issues into account, it was agreed that the Committee should be made aware of the Group's full support for the two recommendations put forward in the project appraisal:

That it be a recommendation to the Authority:

That provision be made in the Authority's capital programme (2006/07 starts) for a scheme [`Headquarters Development: Phase 2'] to provide a new vehicle workshops building at the Headquarters site, Eastleigh at an estimated total capital cost of £4m; and

That approval be given to let a contract using the South East Centre of Excellence (SECE) Project Framework Agreement for the construction of the new building, plant and equipment to Brazier Construction (a division of Kier Regional Limited) at a cost not exceeding £3.7m

4

Non-domestic rates liability - reduction in costs

4.1

The Group considered a report by the Director of Corporate Services and the Authority's Estates Adviser explaining the arrangements in place for reviewing the Authority's liability for non-domestic rates. It was pointed out that the Authority owns 54 properties that are subject to non-domestic rates and uses the services of Hampshire County Council's Estates Practice to review this liability and to ensure that costs are minimised. The Group were very pleased to note that, to date, this review process - incurring fees of approximately £12,000 - has delivered savings of over £198,000 and wished to make the Committee aware of this excellent `invest to save' initiative.

5

Disposal of housing - day-crewed fire stations

5.1

The Group considered a report of the Director of Corporate Services reminding Members there will no longer be a need for the Authority to provide housing when the IRMP objective to end the day-crewing duty system in favour of shift-crewing is implemented at Andover (from 1 April 2007), Winchester (from October 2007) and Havant (from 1 April 2008).

5.2

The houses in question are:

Andover

11 Granada Place

36 Wolversdene Rd

31 Colenzo Drive

Winchester

74 Firmstone

6, 8, 14, 16, 22, and

22a Lower Brook St

5 Ebden Road

61, 63 Alresford Road

60 North Walls

2 Garbett Road

Havant

The Cotswold, Park Way

St John's, Brockhampton Rd

4, 7, 9, 12, 13, 18 Brocklands

5.3

It was noted that these 23 houses will be vacated progressively as each implementation date draws nearer and that while the disposal of the houses has been agreed in principle as part of the implementation of IRMP action plan, it is important that the Authority formally declares each property surplus to its operational needs.  Given the number of properties and the timescales involved, the Group agreed to make the following recommendation to the Finance and General Purposes Committee:

That it be a recommendation to the Authority:

That when houses (listed in paragraph 4.2 of this report) - which are currently associated with supporting the operation of day-crewed duty system at Andover, Winchester and Havant - become surplus to operational requirements they should be immediately disposed of in accordance with the Authority's housing disposal policy; and that progress on such disposals be reported to future meetings of the Asset Management Working Group and the Finance and General Purposes Committee.

6

Change from day-crewing to shift-crewing duty system at Andover, Winchester and Havant Fire Stations: the building implications

6.1

The Group considered a report by the Director of Corporate Services and noted that the change to a shift-crewing duty system means that the fire stations will need to cater for an increased number of firefighters based at each station. The 24-hour occupation of the fire station buildings by a larger group of personnel requires a different and expanded range of accommodation and facilities including: dormitory accommodation, catering facilities, showers/changing rooms, personal kit and equipment storage.

6.2

It was pointed out that each fire station is being assessed on its individual merits to determine the precise building needs and alterations that will be required to make the shift-crewing system work effectively. For Andover, the necessary works will need to be of a standard that will meet needs for the long-term; for Havant, a medium- to long-term solution is required; but for Winchester a short-term solution is sought because of the Authority's plan to eventually relocate the Station to the Workshops site should the project appraisal (see above) be subsequently approved by the Authority. The total estimated cost of the three schemes was put at £650,000.

6.3

Members of the Group were concerned that the cost of essential works at Winchester were estimated at £250,000, and that this included the need to provide accommodation for displaced fire safety staff currently based at Andover. It was felt that every effort should be made to reduce this sum by exploring alternative options, including the use of temporary buildings on the site or elsewhere, if this proved to be in the Authority's best financial interests.

6.4

It was noted that while the costs of any accommodation works would be more than offset by capital receipts that will accrue from the disposal of the associated houses, these schemes were nevertheless significant enough that they need to be added to the capital programme. It was therefore agreed to recommend to the Finance and General Purposes Committee:

That it be a recommendation to the Authority:

That provision be made in the Authority's capital programme at a current estimated cost of £650,000 to cover the cost of necessary building works associated with changing to a shift-crewing duty system at Andover, Winchester and Havant Fire Stations; but that the officers continue to explore options that would reduce the cost of the works at the existing Winchester Fire Station given that only a short-term solution may be necessary if the Authority eventually agrees to redevelop the Station at the current vehicle workshops site.

7

Asset management strategy

7.1

Members on the Group were made aware of the intention to produce a comprehensive asset management strategy which would draw together in single `living document' relevant information about the Authority's built estate. There would be an entry for each property including summarising information from: the condition surveys, the property `terrier' system, valuation assessments, non-domestic rate reviews, energy/utility costs. It would also contain statements of the Authority's future plans (e.g. IRMP proposals) for the site and building. It is anticipated that a first draft of the document would be available by July 2007 and the members of the Group will be involved in developing its format over the coming months.

8

Equality Impact Assessment

8.1

There are no significant issues contained in this report to draw to the attention of the Committee and the proposals within this report are considered compatible with the provisions of the European Convention on Human Rights, the Human Rights Act 1998, and the Race Relations (Amendment) Act 2000.

Background Information (Section 100D of Local Government Act 1972)

The following documents disclose the facts or matters on which this report, or an important part of it, is based and has been relied upon to a material extent in the preparation of the report:

· Agenda and reports considered by the informal Asset Management Working Group at it meeting on 16 October 2006.

Note: The list excludes: (1) published works; and (2) documents that disclose exempt or confidential information defined in the Act.