Council snubbed by government in York Central funding deal

Illustrative York Central Masterplan approved in 2019

The council’s “continued role” in unlocking a new generation of jobs, homes and cultural facilities in the York Central site will be considered by the Executive next Thursday, 22 April.

Funding to complete infrastructure works at the York central site (located behind the railway station) is being made direct to the landowners – led by Homes England – by the government.

It means that the Council’s role will be peripheral despite many millions having already been invested in the project. That may be good news for taxpayers who have seen projects like the Community Stadium and Guildhall refurbishment delayed and go over budget in recent years.

Now contract supervision and liability will rest mainly with Homes England.

Transparency isn’t a strong point for any of the “partners” involved in the York Central project (or the current York Council for that matter). We doubt if engagement will improve under the new governance arrangements.

The Council does remain the planning authority although that role could be undermined as they pursue “Enterprise Zone” status for the project. Planning rules are lax in such areas.

Council report April 2021

The Council is still set to spend nearly £50 million on the project and is dependent on the additional business rate income from Enterprise Zone new businesses to repay its borrowing.

The report being considered next week skates over the risks of this approach,. Those risks appear to have increased since the pandemic with office based developments likely to be less attractive for a while at least.

There are a number of significant planning issues still to be resolved.

These include the (bizarre) suggestion for making the Leeman Road tunnel one way, the absence of an attractive pedestrian/cycle access from the Wilton Rise area and continuing doubts about severing the existing Leeman Road footpath link near the Railway Museum

Last summer Labour Councillors even tried to ditch the project.

The Council has issued the following statement,

“Despite the ongoing challenges of the pandemic, the council has worked with York Central partners Network Rail, Homes England and National Railway Museum to maintain momentum and progress on the 42 hectare York Central site.

After partners finalised the £155 million funding, secured planning permission and started work on the infrastructure to unlock the site, which will deliver up to 2,500 homes and space for up to 6,500 jobs.

Executive will be asked to approve changes to the way the project will be delivered and managed.

This includes the main grant holder, Homes England, taking on the delivery of the bridges, footways, cycleways, roads and other infrastructure to open up the site.

The council will also receive £3.86 million from the government grant to cover the costs incurred advancing the infrastructure project”.

£500,000 grant for York communal housing group

The York and North Yorkshire Local Enterprise Partnership (LEP) was today asked to grant £1/2 million to the Yorspace communal housing group.  The group claimed that their £4 million scheme would create 50 jobs in the construction sector and would be built to uniquely high levels of sustainability.

A report to the decision meeting held today says “This project is a departure from what the Local Growth Fund has supported to date”

LEPs were set up to “support growth, create new jobs and businesses”

Although Yorspace identify 50 new jobs in the construction sector and high insulation standards in the homes, these are far from unique outcomes.

The developer claims it will build “19 low carbon homes….constructed on the Lowfield Green site using biobased sustainable construction materials….sourced locally….and have low embodied carbon, create low energy healthy homes and produce zero waste“.  LEP officials observe that it is unclear what this actually means

The alternative of developing the land for Council housing would have produced the same outcomes. The Council has agreed that all its new build properties will be to “Passivhaus” environmental standards.

The LEPs independent appraiser identified a few weaknesses such as unclear aspects of  procurement, state aid and match funding.

Yorspace is a communal housing cooperative in which house occupiers buy a stake. Originally it was thought that the group would provide homes for the less well off but that seems to be less clear now. Their pitch now seems to be based on the use of ultra sustainable building materials

When the York Council offered to sell a plot for the 19 homes on the Lowfields site it did not impose conditions which would have required the units to be occupied by the less well off, by those on the housing waiting list or even to those currently living in York or North Yorkshire.

No groups such as “key workers” are targeted for the occupation of the units

The project has already been offered a cheap land deal at Lowfields by the York Council and hopes to attract £855,000 from Homes England. Yorspace and its partner the “Lowfield Green Housing Cooperative” currently have joint assets of around £5000. They recently ran a “crowd funding” appeal.

The LEP are clearly concerned that other house builders might regard any state subsidy as unfair. The report says,  “State Aid: The most appropriate applicant – Yorspace or the Lowfield Green Housing Co-operative – needs to be identified, then the State Aid position clarified in the light of this. This also needs to address potential objections from other housebuilders when any LEP grant is publicised”.

The LEP report concludes “In recommending provisional approval it is in recognition that this is an unusual but innovative project that needs further support and assistance and may in the end not be able to be funded”.

The York Council has not debated their approach to this latest application for a taxpayer funded subsidy.

LEP papers are published on their web site but are not easy to find. Meetings attract little advanced publicity.

The meeting report can be downloaded by clicking here

Grant application to LEP