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Guildford Borough Council – Land Disposals Policy and Guidance Document 2010 February 2010 Page 2 of 21 TABLE OF CONTENT
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ITEM 7 – ANNEX II
GUILDFORD BOROUGH COUNCIL
LAND DISPOSALS POLICY AND GUIDANCE DOCUMENT
Revised February 2010 Compiled by: Property & Legal Services Guildford Borough Council
Guildford Borough Council – Land Disposals Policy and Guidance Document 2010
TABLE OF CONTENTS 1.0
EXECUTIVE SUMMARY
3
2.0
INTRODUCTION
4
3.0
LAND DISPOSAL TYPES USED BY THE COUNCIL
4
4.0
POLICY STATEMENTS
5
5.0
STATUTORY PROVISIONS
5
6.0
CORPORATE AND COMMUNITY PLAN OBJECTIVES
9
7.0
COUNCIL PROCEDURES
10
8.0
DISPOSAL BY PRIVATE SALE
11
9.0
DISPOSAL BY FORMAL TENDER
11
10.0
DISPOSAL BY INFORMAL / NEGOTIATED TENDER
12
11.0
DISPOSAL BY PUBLIC AUCTION
12
12.0
DISPOSAL BY EXCHANGE OF LAND
12
13.0
EXCEPTIONS
13
14.0
OTHER CONSIDERATIONS
13
APPENDIX 1 – THE COUNCIL’S CONSTITUTION’S PROCEDURES ON LAND DISPOSAL
15
APPENDIX 2 - EQUALITY IMPACT ASSESSMENT: SCREENING PRO FORMA
18
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1.0
EXECUTIVE SUMMARY
1.1
The Council’s actions in disposing of land are subject to statutory provisions in particular powers under: •
section 123 of the Local Government Act 1972 to dispose of land using whatever method it chooses as long as it meets its overriding duty to obtain the best consideration that can be reasonably obtained for the land;
•
section 32 of the Housing Act 1985 (as amended) to dispose of land held for the purposes of Part II of that Act; and
•
section 25 of the Local Government Act 1988, assistance for private let housing.
1.2
These provisions are subject to certain exceptions that are set out in General Consents; namely The General Disposal Consent 2003 and The General Housing Consents 2005. These stipulate that exceptions will normally be subject to the approval of the Secretary of State although prior approval is given in certain circumstances.
1.3
Depending on the status of the land being disposed of, European and other statutory provisions may apply for the disposal of the Council’s land.
1.4
In line with the Local Government Ombudsman’s advice, this document sets out Guildford Borough Council’s policies and guidance and includes the sale of freehold or leasehold interests, assignment of a lease and the granting of easements.
1.5
The six methods for disposal of land undertaken by the Council are by:
1.6
1.7
•
Private sale;
•
Formal tender;
•
Informal or negotiated tender;
•
Public auction;
•
Exchange of land; and
•
Compulsory Purchase Order (CPO).
Part A sets out the policies by which the Council disposes of land, which include: •
Statutory provisions and General Consents;
•
Corporate and Community Plan objectives;
•
The policies and procedures recorded in its Constitution; and
•
The proper council authority having been obtained.
Part B provides guidance for each of the major methods of disposal.
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2.0
INTRODUCTION
2.1
Local authorities have the freedom to dispose of their land in any manner that they wish subject to certain provisos prescribed within the following major Acts, other Acts and General Consents: •
s123 (Disposal of land by principal councils) and s127 (Disposal of land held by parishes and communities) of the Local Government Act 1972;
•
s32 of the Housing Act 1985 (as amended); and
•
s25 of the Local Government Act 1988.
2.2
The Local Government Ombudsman (LGO) considers it good practice for local authorities to have in place a comprehensive set of guidelines outlining their own approach to land disposals.
2.3
This document covers Guildford Borough Council’s policy and internal guidance relating to land disposal. “Disposal” in this case means the sale of a freehold interest, an assignment or grant of a lease for more than seven years, and the granting of easements and options.
2.4
Whilst the purpose of the document is to make the Council’s land disposal procedures transparent, it is important to note that each land disposal should be treated on its own merits and nothing in this document will bind the Council to a particular course of action in respect of a land disposal. Alternative methods of disposal, not specifically mentioned in this policy, may be used where appropriate, subject to obtaining proper authority (see section [7] below).
3.0
LAND DISPOSAL TYPES USED BY THE COUNCIL
3.1
The Council will usually choose one of the following first five methods for disposing of land. The sixth method of disposal listed below is one that may be imposed on the Council not by choice. An outline of which method to choose is examined in more detail in Part B. •
Private sale - a sale of land negotiated with one or a small number of purchasers at a price agreed between the parties usually following a marketing exercise. A binding legal agreement is created on ‘exchange of contracts’ between the Council and the purchaser;
•
Formal Tender - a sale of land by a process of public advert and tenders submitted by a given date in accordance with a strict procedure. All interested parties should receive an information pack covering legal, planning and infrastructure issues and, on occasions, ground condition reports. Once accepted, the tender constitutes a binding contract of sale;
•
Informal or Negotiated Tender - a sale of land after a public advert that requests informal tenders that meet a given specification or set of objectives. Tenders are invited subject to contract. It is open to all tenderers to submit revised offers and the Council may then negotiate further or more detailed terms with one or more individuals submitting the most advantageous tender or tenders. The successful tenderer is normally required to exchange contracts within a specified period. A binding legal agreement is not created until the exchange of contracts between the Council and the chosen tenderer.
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3.2
•
Public Auction - a sale of land by open auction is open to all parties. The sale will be publicly advertised in advance. The auctioneer creates a binding legal agreement upon the acceptance of a bid;
•
Exchange of Land - a transaction involving the exchange of Council owned land with another landowner. The land acquired by the Council will meet at least one of its corporate objectives and will be ‘equal’ to the land exchanged or if not, the transaction will involve payment by way of a balancing sum referred to as an “equality of exchange”; and
•
CPO - local authorities have powers to CPO land in certain circumstances and it may be that Council owned land becomes subject to a CPO where another local authority exercises such powers.
A contract for sale may be conditional upon planning and in those circumstances the Council recognises the importance of keeping its responsibility as planning authority entirely separate to its role as landowner.
PART A – POLICY
4.0
POLICY STATEMENTS
4.1
The Council will dispose of land in accordance with:
5.0
•
European and national statutory provisions and General Consents;
•
Corporate and Community Plan objectives;
•
The policies and procedures recorded in its Constitution; and
•
The proper council authority having been obtained in accordance with the Constitution.
STATUTORY PROVISIONS Local Government Act 1972 – Best consideration
5.1
Under s123 of the Local Government Act 1972, the Council has wide powers for the disposal of its property assets. The overriding requirement is to obtain the best consideration that can be reasonably obtained for the land. The Act does not apply to the disposal of a short term tenancy of less than seven years.
5.2
The duty to seek best consideration is subject to certain exceptions. These are conveyed in the Local Government Act 1972: General Disposal Consent 2003 (the Consent), which makes provision for the Council to dispose of land where the consideration is less that the best that can reasonably be obtained, known as an ‘under-value’. In these circumstances, the Council must obtain consent from the Secretary of State. Specific consent is not required where the difference between the unrestricted value (market value) of the land to be disposed of and the consideration accepted (the under-value) is £2Million or less. Whilst not superceding section 123 of the Local Government Act 1972, section 3 of the Local Government Act 2000 provides well-being powers for an authority in certain circumstances to accept a disposal at undervalue within the £2 million provided for by the Consent, where the authority deems
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the sale to be for a proper reason/purpose (i.e. for a use to aid wider community benefits but lower value) or where there is an identifiable need to use the capital funds raised by the disposal by a particular time. 5.3
The Council must comply with its duty to obtain the best consideration for land disposed of at under-value. The Council must test whether an offer is the best that can reasonably be obtained having regard to any restrictions or the effect on value of any conditions/ placed on the use of the land, the basis of relevant professional advice including whether the offer under consideration is reliable, advice on possible changes to the price that may flow from changes to the planning situation and other evidence.
5.4
Technical help on valuing land for disposal can be found in the following:
5.5
5.6
•
The Technical Appendix to the Consent provides details of valuation requirements;
•
The above Appendix incorporates the Royal Institution of Chartered Surveyors Valuation Standards (known as the Red Book) definition of Market Value and UK Guidance Note 5 on “Local authority disposal of land for less than best consideration”. The latter also includes guidance on the definition of unrestricted value and under-value; and
•
Additional guidance is provided in Circular 06/03: Local Government Act 1972 General Disposal Consent (England) 2003 - Disposal of land for less than the best consideration that can reasonably be obtained. However it includes a caveat “as not being exhaustive and does not purport to be an authoritative interpretation of the law”.
It remains the responsibility of the Council to seek its own legal or other professional advice on land disposal as it feels appropriate. It must comply with normal and prudent commercial practices including obtaining the view of a professionally qualified valuer as to: •
what financial consideration it should expect to achieve;
•
the likely amount of any under-value; and
•
the most appropriate method of disposal to encourage bidders to offer the best consideration.
The Council is aware that best consideration does not necessarily mean the highest financial offer available. The decision whether or not to accept any offer(s) will take into account an evaluation of the financial considerations as well as the substance and strength of any supporting material submitted with the offer (excluding sale by public auction where supporting material is not an option). Supporting information can lead the Council to accept a lower offer where it has justifiable doubts, for example, about the financial security of a bidder or a bidder’s commitment to a proposed scheme. Public Procurement Considerations
5.7
Until recently it was generally accepted that land disposal was outside public procurement legislation. Case law, notably case 220/05, Jean Auroux v Commune de Roanne ('Auroux') 2009 and cases subsequent to this have brought this into question and it is now necessary to consider the possibility that the disposal of Council owned land, where the values involved trigger the EU threshold, and in circumstances where there is a development agreement
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or the grant of a lease associated with the disposal may trigger the need for an EU tendering exercise. 5.8
If, when disposing of land, the Council is involved in determining the scope of the future development of its land and its intention is to impose on the purchaser certain obligations as to the nature of the development and also perhaps the standards to which the works must be constructed, then it is likely that such an arrangement may be constructed as a public works contract and subject to the EU Procurement Rules1.
5.9
The decision in Auroux therefore brings a wide definition to the meaning of a public works contract and thus increases the risk of transactions falling within that definition. There may, however, be exceptions to this depending on the nature of the transaction, how it is structured and its detailed provisions. As a general principle the risk will be higher the more the Council specifies its requirements for any full development and conversely will be lower the more the Council is willing to take a 'hands off' approach.
5.10
The Office of Government Commerce (OGC) has issued preliminary guidance2 on the application of the public procurement rules to development agreements with the proviso that the applicability or otherwise of the public procurement rules will depend on the particular facts and therefore universal guidance is not feasible and that its understanding is subject to change depending on future arguments from the European Commission. The OGC also emphasises that the European authorities are likely to take a view of the intent and purpose of activities and agreements entered into by a public body and artificial arrangements intended to circumvent the application of the rules are unlikely to be persuasive. The Council must therefore give due consideration to the possibility of public procurement rules applying to any particular disposal of land and obtain case-specific legal advice before entering into any agreement. State aid considerations
5.11
If the Council disposes of land at an undervalue this will be regarded as unlawful state aid unless the requirements of the European Commission's sale of land guidelines are met3.
5.12
The guidelines introduced to ensure that market forces operate freely across Europe, require, in the absence of an open and unconditional bidding process (which could include an EU procurement process), that the disposal is made for the market value of the land as determined by an independent valuer. A disposal of less than the valuer's assessment of market value will be regarded as unlawful state aid the amount of the 'aid' being the difference between the market value and the sale price which unless covered by one of the derogations under the Consent must be recovered from the disposee. Failure to recover any unlawful State Aid could result in the Council being fined.
1
Directive 2004/18/EC of the European Parliament and of the Council of 31 March 2004 on the coordination of procedures for the award of public works contracts, public supply contracts and public service contracts 2
OGC Procurement Policy Note – preliminary guidance on the application of the public procurement rules to development agreements; Information Note 11/09 : 16 October 2009 Commission Communication on State aid elements in sales of land and buildings by public authorities (97/C 209/03)
3
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The interaction of best consideration, procurement and state aid obligations 5.13
It is important to recognise that each of the above three obligations is separate and independent of the others. The fact that the Council has met its section 123 obligations for the disposal of any land does not necessarily mean that its public procurement regulations have also been met. If the Council carries out a full EU procurement exercise it is certainly easier to demonstrate that its obligations in relation to state aid and to obtain best consideration have been met. That is not to say, however, in the absence of an EU procurement process (where such a process is not required) that the Council will not be able to demonstrate state aid compliance and or compliance with its best consideration obligations as this may still be possible by other means and the above guidance must be applied in the light of the specific circumstances and the reasons recorded in writing. Housing Act 1985 (as amended)
5.14
5.15
Under s32 the local authority has the power to dispose of land and dwellings held for housing purposes. Secretary of State Consent will be required unless the disposal is covered by the General Consents for the Disposal of Houses and Land relating to the disposal of: •
vacant dwellings for owner occupation;
•
occupied dwelling houses to secure tenants;
•
dwellings to tenants who have the right to buy acquiring with others;
•
dwellings on shared ownership terms;
•
housing authority land; and
•
reversionary interest in houses and flats.
Disposals are to be at market value, but discounts may be applicable to qualifying applicants. Local Government Act 1988
5.16
5.17
Under s25 a local authority may provide a RSL with any financial assistance or gratuitous benefit of land for development as housing accommodation. Secretary of State Consent will be required unless the disposal is covered by the General Consents under section 25 of the Local Government Act 1988. These include: •
consent to dispose of land for development or access, easements and rights;
•
consent to dispose of dwelling houses for refurbishment;
•
provision of financial assistance for prevention of homelessness; and
•
loans to RSLs.
The aggregate value of financial assistance or gratuitous benefit provided by the disposal or grant shall not exceed £10 million.
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Other statutory provisions 5.18
Depending on the status of the land held by the Council, other statutory provisions may have a bearing on the procedures to be followed if the Council seeks to dispose of the land. These include: •
s233 Town and Country Planning Act 1990 – provisions are set out in this Act for the disposal of land held for planning purposes, which follow principles similar to those of s123 of the Local Government Act 1972 and its requirement to obtain best consideration reasonably obtainable. However, it must be noted that the General Disposal Consent (England) 2003 does not apply and a specific consent from the Secretary of State will be required if the Council is considering disposal at an undervalue;
•
Green Belt (London and Home Counties) Act 1938 – The Council must obtain the consent of the Secretary of State to dispose of green belt land held under this Act;
•
s123 (2A) Local Government Act 1972 – the Council must follow certain statutory requirements to advertise the disposal of land that consists of or forms part of an open space;
•
Charities Act 1993 – for land held subject to a charitable trust, the Council will need to seek the consent of the Charity Commissioners or the Council must comply with the provisions of s36 “Restrictions on Dispositions”;
•
s233 (2) Town and Country Planning Act 1990 – The Council must obtain the consent of the Secretary of State to dispose of common land, which may involve the requirement to provide land in exchange;
•
Allotment Acts 1908 to 1950 – For disposal of land held under these Acts, the Council must obtain the consent of the Secretary of State for disposal other than for use as allotments;
•
Thames Basin Heaths Special Protection Areas (SPA) – where the land has been designated in the Council’s SPA Avoidance Strategy as Suitable Alternative Natural Green Spaces (SANGS), this land can at the time of writing only be disposed of subject to its continued use as SANGS; and
•
Housing Act 1980 – introduced the ‘Right to Buy’ and the disposal of homes to qualifying secure tenants of the local authority.
6.0
CORPORATE AND COMMUNITY PLAN OBJECTIVES
6.1
The Council’s Property Review Group (PRG) is an interdepartmental, multidisciplinary group of senior Officers and two Members with responsibility for effective corporate property asset management.
6.2
A primary responsibility of PRG is to make recommendations for the retention, disposal or acquisition of individual General Fund properties that support the implementation of the Council’s Core Values and Key Strategic Priorities and Community Plan. These are recorded in part in its Asset Management Plan and Capital Strategy. The disposal of major sites or key strategic sites is listed on an Action Plan and the disposal process is reviewed and monitored by PRG on a monthly basis.
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6.3
Strategic Property Review – The Council is undertaking a strategic property review with a view to developing an asset strategy to define medium to long term goals for its property resource.
6.4
The Council’s Housing Strategy sets out the future strategy for investment in affordable housing including the use of Council owned assets. The Council’s Housing Working Party (HWP), an interdepartmental group of senior officers, reviews the implementation of the Housing Strategy. Disposal of HRA land is carried out under this authority, or authority is sought from the Executive under the Annual Housing Programme.
7.0
COUNCIL PROCEDURES
7.1
The Financial Procedure Rules, Procurement Procedure Rules and Delegation to Officers in the Council’s Constitution prescribe the procedures that the Council must adopt for the disposal of land. The relevant procedures are listed in Appendix 1. The complete Constitution can be inspected on the Council's website.
7.2
Where statutory provisions for land disposal apply, these must take precedence over the Council’s internal policies and guidelines.
7.3
All land for disposal is considered by PRG or the HWP. For major disposals not delegated to the Head of Economic Development, PRG submits a recommendation to the Executive, which in turn takes the final decision as to whether and how to dispose of land. Ultimate responsibility for strategic management of the Council’s property portfolio rests with the Executive.
7.4
Decisions taken by the Executive are recorded in the minutes of the meeting and may be inspected on the Council’s website. Decisions taken by officers under delegated powers are documented (including appropriate authorisations) and records maintained. Members are advised of such decisions through the ‘Wey Ahead’, a newsletter for Councillors. These decisions are to be taken in consultation with the relevant Lead Member.
PART B – GUIDANCE The facts of each intended disposal and the precise relationship between the parties are likely to be different at least in detail of each case and the guidance must be applied in the light of specific circumstances. Where any disposal is being considered where the values trigger the EU threshold (currently £3,927,260) the Council must obtain specific legal advice before proceeding including in appropriate cases and how the value of a particular disposal may be assessed for the purposes of determining whether the threshold is triggered. In cases of doubt the Council should carry out a full EU procurement exercise. Subject to the comments above the following methods of disposal may be adopted.
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8.0
DISPOSAL BY PRIVATE SALE
8.1
A disposal by private sale may take place after a period of extensive marketing including advertising and generally making known including signage that it is available for sale. In this case, the Council will be able to consider the highest bid as representing the best consideration that can be reasonably obtained. Private sale should generally be used when there is a buyer's market, where there is a special purchaser and where there is to be an element of joint venture, for example, claw back or profit sharing.
8.2
If land is to be sold by private sale without being marketed, then the reasons justifying a private sale must be recorded in writing. In some circumstances the Council may seek an independent valuation to verify that ‘best consideration’ is being obtained. A private sale without the land being marketed may be justified where: a.
the land to be disposed of is relatively small in size and an adjoining or closely located landowner is the only potential or likely purchaser;
b.
the nature of the Council’s land ownership and that of the surrounding land ownership is such that the land must be sold to adjoining or surrounding landowners if best consideration is to be obtained; or
c.
the Council’s land is part of a larger area of land that is proposed for development, redevelopment or regeneration. Also, the nature and complexity of the proposed development of the overall site is such that the Council’s corporate objectives and best consideration can only be achieved by a sale to a purchaser with an existing interest in land in the area.
8.3
A legally binding agreement will not be concluded until either contracts for the lease or sale of land are exchanged or a development agreement is signed.
9.0
DISPOSAL BY FORMAL TENDER
9.1
A sale of land by formal tender may be appropriate where the land ownership is not complex and the Council is seeking obligations to be placed on the successful tenderer that are clear and capable of specification in advance, for example, the disposal of land to a developer with an obligation to build industrial units for lease or, the conservation of a listed building. In such instances, a process of formal tender will be appropriate in gaining best consideration.
9.2
The nature of the formal tender process is that a legally binding relationship is formed when the Council accepts a tender in writing. It is essential therefore, that every aspect of the disposal is specified in the tender documents. The tender documents should include a contract for sale or lease, which should be completed with the tenderer’s details, the tender price and be signed by the tenderer. It will be released unconditionally to the Council on submission of the tender.
9.3
Sale of land by formal tender will require a detailed specification to be drawn up. This needs to specify the land to be sold, any requirements to be met by the tenderer and any obligations that must be met. The Council may seek formal best and final bids if two or more tenders score closely in the evaluation process.
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9.4
The Council will place a public advertisement seeking expressions of interest and publicise the selection criteria by which it will evaluate tenders. Selected tenderers will then be invited to submit their tender bids.
10.0
DISPOSAL BY INFORMAL / NEGOTIATED TENDER
10.1
A disposal by informal/negotiated tender differs from a formal tender in that neither the Council nor the successful bidder is legally obliged to enter into a contract for the disposal of the land. The informal/negotiated tender process allows the Council to identify one preferred bidder with whom it may then negotiate further detailed terms or proposals.
10.2
The Council uses a public advert to request informal development proposals for land that meet a given specification. This process is particularly useful where the proposals may need to be developed in co-operation with the preferred bidder to meet the Council’s corporate objectives and to achieve the best consideration that can be reasonably obtained.
10.3
A binding legal agreement is not created until the exchange of contracts for sale or lease.
11.0
DISPOSAL BY PUBLIC AUCTION
11.1
Sale by public auction may be appropriate for disposal of smaller properties or those that present difficulties, for example, where no planning consent has been forthcoming so that it is difficult to establish a clear idea of value, or there is no obvious potential purchaser.
11.2
Exceptions to the usual tendering process must be authorised and recorded in accordance with the Council’s Procurement Procedure Rules.
11.3
Before the sale, the property should be advertised and the marketing agent should be asked to recommend a reserve price which will be confidential and known only to the vendor and the auctioneer.
11.4
The contract for sale or lease together with HIPS where appropriate, replies to standard pre-contract enquiries and all appropriate searches must be provided and be ready for exchange at the auction.
11.5
The binding contract will be made on the acceptance of the highest bid providing it has reached the reserve price. Contracts for the sale or lease will immediately be signed and exchanged.
12.0
DISPOSAL BY EXCHANGE OF LAND
12.1
Disposal by exchange of land will be appropriate when it is advantageous to the Council and other parties to exchange land in their ownerships and will achieve best consideration for the Council.
12.2
The exchange will usually be equal in value. However, any inequality in land value may be compensated for by the receipt of a balancing payment or other means of consideration as appropriate. For example, where the Council in exchange for a larger piece of land receives a smaller piece of land but the recipient of the larger plot agrees to build industrial units on the Council’s smaller area to equalise the consideration. In such circumstances the Council
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will always obtain an independent valuation to verify that ‘best consideration’ will be obtained. 13.0
EXCEPTIONS
13.1
Other methods of disposal may be used where circumstances warrant, for example delivering housing for people with special needs that might otherwise not be assisted through housing development opportunities. In such cases, authority needs to be obtained in accordance with section 7 above.
14.0
OTHER CONSIDERATIONS EU Principles Debriefing and Freedom of Information
14.1
Whether or not the EU threshold is triggered there is now a requirement for all local authorities to act under the general EU principles of transparency, proportionality, non-discrimination, equality of treatment, transparency public disclosure. Those principles usually imply an obligation to research the market, interview partners and to enter agreements via non-discriminatory procedures including effective debriefing after the award of any contract. Where a full EU Procurement Exercise is carried out there are additional legal requirements to give reasons for the award of any contract under Regulation 32 of the Public Contracts Regulations 2006. There are two types of debriefing: •
The debriefing during the Alcatel standstill period. The standstill period is triggered by the contract award letter or "standstill" letter (Regulation 32(1) to 32(3)). If a written request is received by midnight at the end of the second working day after the date of despatch of the standstill letter, the contracting authority must give the debriefing at least three clear working days before the end of the standstill period (Regulation 32(4) and 32(5));
•
The regular debrief to be provided if requested in writing at any stage in the process where bidders are deselected. The contracting authority must give the debriefing information within 15 days of the request (Regulation 32(9) and 32(10)). (Note, the regular debrief also applies if a standstill letter has been sent and the written request for a debriefing is received after midnight of the second working day after the date of despatch of the standstill letter.)
•
Bidders (and others) are also entitled to request wider information under the Freedom of Information Act 2000 ("FOIA") than an authority is required to disclose under the debriefing obligations. Commercially sensitive information may be able to be withheld if it falls within one of the exemptions.
•
A contracting authority has 20 working days from receipt of a FOIA request to respond.
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Equalities 14.2
In respect of any disposal the Council must comply with its legal obligations in relation to equalities and diversity, which include positive duties to have regard to the need to eliminate unlawful disability, gender, race and religious discrimination and promote equality of opportunity. As is required for all Council policies an Equalities Impact Assessment screening has been carried out for this Document. The result of that screening is attached at Appendix 2 and shows that the policy has low adverse impact and a full equalities impact assessment is not required. However, the following actions have been identified to improve it around the equality agenda and will be incorporated into the procedure with immediate effect: All selection criteria for evaluating any tender will not include any assessment linked to any of the equality strands of race, age, disability, gender, sexuality or religion. Publication of all selection criteria by which the Council will evaluate tenders at the time of inviting tenderers to submit their bids will guard against this. Late Bids
14.3
Any ‘late bid’ must be considered in the context of the individual circumstances at the time. The Council’s approach to ‘late bids’ will vary depending upon the method of land disposal used. In each case, its overriding duty will be to obtain best consideration that it can reasonably obtain (subject to any exceptions in the Consents). Remedies Directive
14.4
Where the EU threshold is triggered and a full EU Procurement Exercise is carried out the Council needs to be aware of the Remedies Directive 2007/66/EC which was implemented with effect from 20 December 2009. This directive strengthens the position of contractors wishing to challenge procurement processes where they believe there has been a breach of the Procurement Regulations or a breach of certain other legal obligations in relation to Public Procurement on the part of the procuring authority. Under the Directive a legal challenge made prior to the contract being entered into will lead to the contract award process being automatically suspended until the matter is determined by the Court. Where a successful challenge is made after the contract has been entered into the Court will be required in the case of the most serious breaches, which are specified in the draft Regulations, to declare the contract "ineffective" unless the Court is satisfied that there are "overriding reasons relating to the general interest" to the contrary. A declaration of ineffectiveness means that the contract is brought to an end. The Court must also impose a financial penalty and may award damages to be paid by the procuring authority.
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APPENDIX 1 – THE COUNCIL’S CONSTITUTION’S PROCEDURES ON LAND DISPOSAL The Constitution of the Council procedures relating to land disposal are as follows: PART 3(4) – DELEGATION TO OFFICERS The Head of Legal & Democratic Services: 179. To sign all legal documents relating to the disposal by the Council of any land or interests in land or the supply of goods or services. For Property and Contractual matters, the Head of Legal & Democratic Services: 203. In consultation with the Lead Member and Head of Economic Development and subject to being satisfied that the Council will receive the best consideration reasonably obtainable: (a)
to accept terms for the granting, renewing, reviewing and varying of leases of Council-owned land and property;
(b)
to grant licences, easements, rights of way and wayleaves over Councilowned land;
(c)
to sell or let land for the use of statutory undertakers and to licence land to developers to facilitate development;
(d)
to sell land and buildings up to 0.2 hectares in area, following consultation with the ward councillor(s) and subject to the purchaser paying all the Council’s costs in relation to the sale.
204. In consultation with the Head of Economic Development and other relevant head(s) of service, to grant annual leases to organisations receiving grant support from the Council on such terms and conditions as shall be considered appropriate. 205. In relation to the Council’s land and premises leased or licensed to others and in consultation with the Lead Member and Head of Economic Development: (e)
to approve proposals for assignment, sub-letting or surrender of leases and for change of use;
(i)
to make arrangements for the reletting of premises.
215. To approve the sale of houses and determine all associated matters in accordance with the right to buy scheme and the Council’s agreed policies. 219. To approve the disposal of small pieces of land adjoining former Council-owned properties to the owners. 221. To sell acquired properties and mortgage repossessions. 223. In consultation with the Head of Parks and Countryside Services, to sign all agreements for the letting of allotments.
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Guildford Borough Council – Land Disposals Policy and Guidance Document 2010
PART 4 (8) – PROCUREMENT PROCEDURE RULES 2.
THE PRINCIPLES OF THE PROCEDURE RULES
Land and Property 2.18/1 Any disposal of land or buildings must be in accordance with the Council’s Financial Procedure Rules on asset disposal. 2.18/2 All contracts for the acquisition or disposal of land (including buildings) must: (a)
comply with all relevant statutory provisions; and
(b)
be approved by the Head of Economic Development and Head of Legal and Democratic Services.
3.
EXCEPTIONS
3.1
Subject always to the overriding requirements of the public procurement legislation, quotations shall not be required (subject to the procuring officer obtaining the agreement of the Head of Corporate Development) and tenders shall not be required (subject to the procuring officer obtaining the agreement of the Head of Corporate Development and following consultation with the Leader of the Council or relevant Lead Member) in the following circumstances: (ix)
3.2
where a disposal of land or buildings is to be made unless the Head of Legal and Democratic Services considers a tender or quotation is appropriate, in which event these Rules relating to tenders and quotations shall be complied with.
In all cases, where an exception to the tendering or quotation process is made, the explanation for doing so shall be documented and retained by the head of service for inspection.
PART 4 (9) – FINANCIAL PROCEDURE RULES C.6
ASSET DISPOSAL
C.6.1 It would be uneconomic and inefficient for the cost of assets to outweigh their benefits. Obsolete, non-repairable or unnecessary resources should be disposed of in accordance with the law and rules of the Council. C.6.2 Key Controls (a)
Assets for disposal are identified and are disposed of at the most appropriate time and only when it is in the best interests of the Council, and the best price is obtained, bearing in mind other factors, such as environmental issues. For items of significant value (other than land or buildings), disposal should be by competitive tender or public auction.
(b)
In relation to the disposal of land and buildings: (i)
February 2010
The delegated powers of the Head of Economic Development and Head of Legal and Democratic Services, including authority to sell land and buildings up to 0.2 hectares in area, are set out in Part 3
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Guildford Borough Council – Land Disposals Policy and Guidance Document 2010
of this Constitution. Any disposal not delegated to the Head of Economic Development or Head of Legal and Democratic Services must be authorised by the Executive.
(c)
(ii)
Where land or buildings are surplus to requirements, the Head of Economic Development and Head of Legal and Democratic Services or Executive (as appropriate) shall consider a report and recommendation setting out the relevant information, such as the planning position, potential use, legal issues, current and proposed development restrictions, estimated market value and confirmation that best consideration is being obtained.
(iii)
For all disposals, a valuation must be provided by a Chartered Surveyor. If the likely value exceeds £100,000, this must be supplemented by a second external valuation.
(iv)
Subject to the over-riding requirement of public procurement legislation, the Council’s Procurement Procedure Rules shall not apply to the disposal of land and buildings unless the Head of Economic Development and Head of Legal and Democratic Services consider that tenders or quotations would be appropriate. Where quotations or tenders are not required, this will be subject to the agreement of the Head of Corporate Development and consultation with the Leader or relevant Lead Member in relation to tenders.
(v)
In the event of disposal by formal tender, the Council’s Procurement Procedure Rules shall be complied with and a contract for the disposal must comply with relevant statutory provisions and be approved by the Head of Economic Development and Head of Legal and Democratic Services.
(vi)
All disposals shall be at market value unless otherwise agreed by the Chief Financial Officer in consultation with the Leader or relevant Lead Member. Except where a general consent exists, specific consent shall be obtained from the Secretary of State prior to an interest in land or property being disposed of for a price less than the market value (i.e. at under-value). Such disposals must follow the procedure outlined in (ii) above, including a statement of estimated market value and that the under-value price still achieves best consideration reasonably obtainable.
Procedures protect staff involved in the disposal from accusations of personal gain.
C.6.3 Responsibilities of the Head of Corporate Development To issue guidelines representing best practice for disposal of assets. C.6.4 Responsibilities of the Head of Financial Services To ensure appropriate accounting entries are made to remove the value of disposed assets from the Council’s records and to include the sale proceeds if appropriate. C.6.5 Responsibilities of Directors and Heads of Service (i)
To seek advice from purchasing advisors on the disposal of surplus or obsolete materials, stores or equipment.
(ii) To ensure that income received for the disposal of an asset is properly banked and coded. February 2010
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Guildford Borough Council – Land Disposals Policy and Guidance Document 2010
APPENDIX 2 - EQUALITY IMPACT ASSESSMENT: SCREENING PRO FORMA Section
Legal Services Property Services
Officer responsible for the Richard Lingard screening/scoping Chris Mansfield
Name of Policy Land Disposals Policy and Guidance Date of Document to be assessed Assessment
Is this a proposed new or existing Existing 2007 updated 2010 policy/procedure/practice?
1.
Briefly describe the aims, objectives and purpose of the The document sets out Guildford Borough Council's policies and guidance for the disposal of Council owned land and includes the sale of freehold or policy/procedure/practice? leasehold interests, assignment of leases and the granting of easements
2.
Are there any associated or specific objectives of the To comply with Local Government Ombudsman's advice on good practice and to make the Council's land disposal procedures transparent policy/procedure/practice? Please explain.
3.
Who is intended to benefit from this policy and in what Councillors and officers and all other interested parties; professional advisors; contractors; and members of the public way?
4.
What outcomes are wanted from this policy/procedures/ Openness and transparency and consistency when considering the disposal of Council owned land. A checklist of matters to be considered before practice? embarking on a particular course of action in respect of a land disposal
5.
What factors/forces could contribute/detract from the Alternative methods of disposal, not specifically mentioned in the policy may be used where appropriate subject to advice and obtaining specific authority outcomes?
6.
Who are the main stakeholders in relation to the policy?
7. the
Who implements the policy, and who is responsible for Councillors and officers responsible for the policy and its implementation policy?
Councillors, officers, professional advisors, contractors, members of the public
8. Are there concerns that the policy could Y have a differential impact on racial groups? What existing evidence (either presumed or When considering the disposal of any Council owned land the Council has an overriding duty to obtain the best consideration that can reasonably be obtained for the land in otherwise) do you have for this? question which is a pure economic assessment and an objective test not in any way linked to the identity of the bidder. However, in circumstances where tenders are sought following public advertisement to be evaluated February 2010
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Guildford Borough Council – Land Disposals Policy and Guidance Document 2010
against selection criteria it is essential that the criteria do not include any assessment linked to any of the equality strands of race, age, disability, gender, sexuality or religion. The requirement to publicise all selection criteria by which the Council will evaluate tenders at the time of inviting tenders to submit their bids would guard against this. 9. Are there concerns that the policy could Y have a differential impact due to gender? What existing evidence (either presumed or See 8 above otherwise) do you have for this? 10. Are there concerns that the policy could Y have a differential impact due to disability? What existing evidence (either presumed or See 8 above otherwise) do you have for this? 11. Are there concerns that the policy could Y have a differential impact due to sexual orientation? What existing evidence (either presumed or See 8 above otherwise) do you have for this? 12. Are there concerns that the policy could Y have a differential impact due to their age? What existing evidence (either presumed or See 8 above otherwise) do you have for this? 13. Are there concerns that the policy could Y have a differential impact due to their religious belief? What existing evidence (either presumed or See 8 above otherwise) do you have for this?
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Guildford Borough Council – Land Disposals Policy and Guidance Document 2010
14. Are there concerns that the policy could have a differential impact due to them having dependants/caring responsibilities?
N
What existing evidence (either presumed or See 8 above otherwise) do you have for this? 15. Are there concerns that the policy could have a differential impact due to them have an offending past?
N
What existing evidence (either presumed or See 8 above otherwise) do you have for this? 16. Are there concerns that the policy could have a differential impact due to them being Transgender or transsexual?
N
What existing evidence (either presumed or See 8 above otherwise) do you have for this? 17. Could the differential impact identified in 816 amount to there being the potential for adverse impact in this policy/procedure/practice?
N
18.
Can this adverse impact be justified on the grounds of promoting equality of opportunity for one group? Or any other reason?
N
Business improvement
N
19.
Is there any concern that there are unmet needs in relation to any of the above groups? 20.
Does differential impact or unmet need cut across the equality strands (e.g. elder BME groups)?
February 2010
N
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Guildford Borough Council – Land Disposals Policy and Guidance Document 2010
21. If yes, should the full EIA be conducted jointly with another service area/contractor/partner/ agency?
N
22. Is there a missed opportunity to improve your business in relation to any of the policies, procedures or practices to promote racial, gender, disability, age, sexual orientation, religion or belief equality?
N
23.
N
Should the policy proceed to a full equality impact assessment?
0 – no possible relevance or adverse impact 1 – extremely low relevance and adverse impact 2 – relatively low relevance and adverse impact 3 – medium relevance and adverse impact 4 – relatively high relevance and adverse impact 0–8 points low adverse impact, no need for full EIA 9–17 points medium adverse impact, full EIA required 18–24 points high adverse impact, full EIA required
Age
1 24.
Disability
1
Gender
1
Race
1
Sexuality
1
Religion
1
Total
Impact
6
LOW
If No, are there any changes required to the The policy requires all disposals of land to be in accordance with the Council's corporate policy to improve it around the equality objectives and to publicise all selection criteria against which it will evaluate bids for the acquisition of the land. agenda?
Signed (completing officer)
Date
Signed (Head of Section)
Date
Countersigned (member of Equality Action Group) February 2010
Date Page 21 of 21