Meeting documents

To consider the information attached.

Contact Officer: Mark Wathen (01296) 585064

The Committee received a report updating Members on the arrangements for the establishment and operation of the Aylesbury Vale Enterprise Zone (AVEZ).  Enterprise Zones are an important part of the Government’s programme to devolve responsibility for leadership of local growth and provide a powerful tool for areas to develop their local economy.

In the latter stages of 2015, working closely with public and private sector partners, BTVLEP had submitted an application for an Aylesbury Vale Enterprise Zone (AVEZ) with the support of AVDC, which had subsequently been accepted by central government.  The award of the AVEX was a testament to the positive partnership working between AVDC, BCC, BTVLEP, Silverstone  Park, Westcott Venture Park and Arla Dairies.

Businesses basing themselves on Enterprise Zones can access up to 100% business rate discount worth up to £275,000 per annum over a 5 year period. This benefit can only be offered up until March 2022, from which point the benefit will taper until the offer expires in March 2027.  In addition, Enterprise Zones benefit from 100% retention of business rate growth for LEPs to reinvest in development on the Enterprise Zones (through discussion and negotiation with partners).

The LEP, landowners and Local Authority Partners in the Enterprise Zone would also continue to benefit from 100% growth of business rates retention for 25 years with 100% protection from any future reset or redistribution and as such, would sit outside the standard LA rates retention arrangements that would exist outside Enterprise Zones.  Business rate growth on an Enterprise Zone would not count towards an authority's business rate baseline income and, as a result, would not be used in the calculation for local authority top ups or tariff payments.  Furthermore, EZ's business rate discounts and capital allowances that were fully funded by the Government would generate business rates income that would not otherwise have arisen.

Importantly, all of the Business Rates generated on the Enterprise Zone sites would be under the control of the Enterprise Zone’s Governance Board. The District and County Councils would not automatically receive any proportion of the Business Rates generated on these sites (currently 40% to AVDC and 9% to BCC).  However, it was possible to agree within the MoU and partnership agreement, that a proportion of the growth should still go to the local authorities, but this had to be negotiated and documented.

Because of this fact, the outline submission to the Government (referred to below) included the prerequisite that neither authority should financially be any worse off from the creation of these Enterprise Zones. This is particularly important when it is considered that a significant proportion of the Vale’s business rates growth over the next 2 decades might have been located within these areas. It is estimated that AVDC might have benefited by anything up to £30 million in revenue terms over that timeframe from these sites (using existing calculation methodology). Agreement of the detailed terms of the MoU and inter party agreement would therefore be vitally important.

The Aylesbury Vale Enterprise Zone comprised three elements which were further expanded on in the Committee report and in the Annexe 1.  These elements were:-

·                     The Space Related element of the Westcott Venture Park site.  The space propulsion element had not seen any major development since the 1940s but the allocated land could attract the higher value knowledge economy type business and investment.  Investment in this Space Sector was currently heavily controlled by Government through the European and UK Space Agencies.

AVDC were working closely with Westcott and a major space engineering company to locate to Westcott with a view to them being established and up and running by March 2017

·                     The currently undeveloped site K of the Silverstone site.  Being an EZ would support the acceleration of the development of the site and attract businesses.  Site K had outline planning permission for employment uses and a recent detailed planning permission of a first phase of development totalling some 11,000m² of new floor space.

·                     On Arla/Woodlands, the site included a mix of consented land (Arla development) and unconsented (led by Buckinghamshire Advantage) land.  This site was intended to have a focus on Food and Drink, Health and Care related activities.

The Committee report went on to explain the prospective governance framework for the Enterprise Zone which would include having formal approval of a Memorandum of Understanding for the AVEZ.  The Government was now asking all parties to agree an MoU for each EZ.  For them to be effective, the MoU would need to be agreed by all parties, i.e. AVDC Cabinet, BCC Cabinet, the LEP and the landowners in place by April 2016.  The MoU would need to set out how monies would be allocated and the final governance arrangements.  For example, this could cover arrangements for the wider business rates devolution. 

The AVEZ Strategic Board would be responsible for maximising the potential of this location to benefit Buckinghamshire and for managing the delivery of the strategic vision.

Separately, BCC, AVDC and BTVLEP had discussed the idea of a Partnership Arrangement existing between BTVLEP and the Collection Authority (i.e. Accountable Body) setting out the services to be provided by Accountable Body and what kind of finance systems would site around the arrangements.

In summary, the Committee was informed that the approval of Aylesbury Vale Enterprise Zone status was an enormous boost to help grow existing businesses and attract and accelerate new investment in 3 strategically key sites and in key knowledge based manufacturing and technology sectors for the Vale in which the UK was a global leader.

Members requested further information and were informed:-

·                    that the AVEZ would retain 100% of growth in business rates to re-invest in development of the EZ, although discussions and negotiations would be needed between partners to decide on how this happened.

·                    that local Members would be regularly kept abreast with what was happening in the EZ elements in their areas.

·                    that the AVEZ would be looking to attract new business and ventures, rather than poaching businesses from within the local area.

·                    that AVDC would be looking to play a big part in developing the Communications Strategy and Action plan for the AVEZ.

RESOLVED –

(1)       That the progress made with partners regarding the formal establishment of the Aylesbury Vale Enterprise Zone be noted.

(2)       That the Committee was supportive of AVDC’s Cabinet moving forward and formally approving a Memorandum of Understanding and supporting Partnership Agreement for the establishment of the Aylesbury Vale Enterprise Zone.