‘Keep your blog posts short’ they say! I tried, but the Community Stadium is quite a big issue! In brief – it looks like it’s finally going to happen, but there are concerns about the financial risks that are still there and complicated contract arrangements. There’s a bit of a question as to how quality is being maintained for millions of pounds less spend, following reduced capital income. It’s great that Yearsley Pool is being included in the full contract term, supported by a Green Party budget amendment in 2015, but long-term funding is still not certain. It’s a huge missed opportunity (for sustainability and financial common sense) that renewable energy and more iconic design isn’t included. More detail below.
I stood in for Green Group leader, Cllr Andy D’Agorne, at the Council’s Executive meeting on Thursday. The main agenda item was the final sign off for the financial deal on the new Community Stadium at Monks Cross – see The Press coverage of the meeting here http://www.yorkpress.co.uk/news/15439157.York_stadium_project_given_green_light/?ref=mrb&lp=5#comments-anchor
I was pleased to join others in congratulating officers on the amount of work that has been done to get this far. After such a long time, there is a real prospect of work starting in the Autumn. Parts of it could be open just before the May local elections in Spring 2019, as it happens. Although even if it’s on target, it seems the grass on the pitch will need to grow a bit more before the stadium itself opens in June 2019! However, we don’t yet have signatures on the bottom line, so fingers still need to be crossed!
The financial package that supports the building of the stadium and leisure centre is hugely complex. It still includes a lot of risk and raises quite a lot of questions, which were not fully answered.
Sadly, the simple and elegant notion that we pay taxes and national and local government work together to provide services and facilities, perhaps using the clout of a large public organisation to borrow at preferential rates to add to the pot, has become something of a distant memory for now. Part of the funding does indeed come from the Council’s preferential borrowing, which is something that despite all the cuts it can do. But this still has to be paid for out of a declining revenue budget and there is a (debateable) limit as to how much this can safely be used.
Other parts of the funding package come from the so-called ‘section 106’ money – the ‘planning gain’ from the Monks Cross retail development (M &S, John Lewis) and also from the land sale of part of the site for the ‘Commercial Development’ – parts of the stadium complex that will include a range of shops and restaurants.
A tangled web
A confusing array of companies and contracts are involved – the Council contracts with Greenwich Leisure (GLL) to Design, Build, Operate and Maintain (DBOM) the complex (throwing in the operation of Yearsley Swimming Pool and Energise). GLL in turn tender for a Building Contractor – the previous one pulling out was responsible for the latest hold up. GLL has a separate contract with another development company, Wrenbridge Sport, to develop the Commercial Development. The Council and the developer have a ‘deal’ with another company, an investment fund, now Legal & General, who will ultimately acquire the Commercial Development.
The Council also has a deal with Cineworld regarding the new Imax cinema – and as yet unsigned deals with York Hospital, York Against Cancer and the two football clubs. A special arrangement has to be made regarding a potential deal with York Explore Libraries to put an innovative new library into the Community Hub – because the Library Service is externalised and funded largely by the Council via a tendered contract, the re-procurement date comes before the Stadium completion, so no contract can be made with the existing library provider (although we all know we hope it will be the same one after the re-tender because there are very limited options for other bidders of a reasonable quality!). A new sponsor still needs to be found for a Stadium Naming Rights contract to contribute in the region of £40-60,000 to the revenue budget. And that’s the simple version!
Will quality be maintained?
The capital income from the Commercial Development is now just under £3 million less than it was going to be in March 2016, due to changes in market conditions post-Brexit. The build cost quoted
by the new Building Contractor has also fortuitously reduced by £2.7m and along with some other changes this appears to balance the books. I asked where the reduction in build costs came from – a bit of research indicates it isn’t in materials (prices have increased post Brexit with a weak pound), hopefully it isn’t labour costs as we should be paying proper industry rates and a small pay rise is in place for construction workers.
I was told that it’s due to the competition, that the project is desirable and companies want it in their portfolio. I can only assume this means they will take a cut in profits, as I am assured that the build quality of the complex will not be reduced. I hope very much that my concerns here are groundless and that this will be the case – bearing in mind though that £4m was previously shaved off the rising build costs in 2015 through ‘value engineering’ – a phrase I can’t help feeling is a euphemism for something else ….
As a Green Party councillor, I still think the Stadium Complex is in the wrong place – we have yet to see the traffic impact it will have on the surrounding neighbourhoods, not to mention potentially the
whole road system in York. It isn’t going to be as easily accessible for people in all parts of York whether they own a car or not, as a city centre location, for example on York Central, would have been. The massive retail development at Monks Cross which is partly paying for the Stadium has not helped the struggle for survival of York’s unique independent business – although the city centre is fighting back well in some ways, there is a trend towards more and more tourist-friendly cafes, bars and restaurants and less diversity.
However, this decision is now ‘water under the bridge’ and it would make sense to make the stadium in the current location as sustainable as possible – both environmentally and financially. So I asked if it would have solar panels on the numerous rooftops? I was told basically ‘no’.
One Planet solutions?
The cost of solar panels is now shooting downwards around the world, installing panels on new build is cheaper than retro-fitting them and even with limited Government subsidy, they still provide free energy at least during the day – whilst rapid advances in battery storage even offer the prospect of free energy after dark. As a city committed to One Planet sustainability principles it really is time we ‘walked the walk’ rather than just ‘talking the talk’ – signing up to strategies and pretty logos is fine, and so is encouraging community groups to pick up litter and plant trees, but if we don’t apply the principles to the big projects in the city as well, we’re not really doing it! At the same time, the financial common sense in investing in renewables ought to be overwhelming!
And, there’s also the potential to create iconic and more imaginative design. I googled ‘images stadiums solar panels’ – there were loads, including these:
Yearsley Swimming Pool
I think there’s general agreement that the inclusion of Yearsley Swimming Pool in the DBOM contract for the full contract period of 13 years (+ an option for another 5 years) is very welcome. This is in no small degree due to the untiring campaigning of the Yearsley Pool Action Group and Fiona Evans. The Green Party is very pleased to have played a key part in ensuring the financial package that is now helping to take Yearsley forward via our budget amendment in 2015 that allocated supporting funding via the New Homes Bonus.
However, it was also clear that the future of the pool long term is by no means fully signed and sealed – projections indicate that with the subsidy the pool will start to make a profit after a number of years, which can then be used to help support the pool in future years. But a review will have to take place around 2024 for the Council at the time to decide if it can afford to keep the pool in the GLL contract.
Hopes and risks
So, the story overall is by no means a negative one – if it all comes off this time the Stadium complex will be a great facility for a large number of York residents. I really hope it does work – but I do think as opposition councillors we certainly have an obligation to consider the risks and potential flaws. Worth mentioning that the Council is to pay £500,000 upfront to the Building Contractor for early works in order to keep to the proposed timetable. The payment is now – before Financial Close is signed off, hopefully at the end of August. If all goes well, this money will become part of the overall deal, but if Financial Close doesn’t happen the Council will lose the money ….
Going forward let’s hope we can find the best ways to mitigate the traffic impacts and also to make sure that all of York’s citizens, wherever they live, whatever their income and whatever their ability to travel, can benefit from these major new facilities.