DRAFT Asset transfer - Basis - Stockton Council

DRAFT Asset transfer - Basis

Who will we consider transferring assets to?

We will consider asset transfer to any voluntary or community sector organisations providing they meet the criteria outlined below. A key consideration however will be the sustainability of the organisation and its capacity to manage and develop the asset.

The organisation must:

Be a voluntary and community sector organisation which is a legal entity
Be appropriately constituted (e.g. a registered charity, community interest company or charitable incorporated organisation, a not for profit company)
Have a strong financial background and/or a demonstrable financial plan moving forward. (The council will wish to review copies of audited accounts and forward projections where appropriate)
Exist for community/social/environmental/economic benefit
Be non-profit distributing ? it must reinvest any surpluses to further its social aims/community benefits
Have stated community benefit objectives
Demonstrate strong governance by operating through open and accountable co-operative processes, with strong monitoring evaluation, performance and financial management systems
Demonstrate it has the skills and capacity within, or available to, its managing body to effectively deliver services and manage the asset;
Have a management proposal which includes a specific plan on health and safety issues and compliance with legislation and any statutory requirements arising from ownership or management of the building or running a service;
Have a clear purpose and understanding of the activities it wishes to deliver and demonstrate how the asset transfer will enable and support these activities.

Legal status of transferred assets

Asset transfers will generally be by means of a long-term lease, the terms of which will be agreed at the time of each individual transfer. Freehold transfer will only be considered in exceptional circumstances.

The organisation taking ownership will be responsible for:

Upkeep, repair and maintenance of the building
All running costs
Compliance with statutory inspections and health and safety requirements

In all cases involving transfer of ownership/occupation appropriate legal mechanisms will be put in place to protect the financial position of the Council, such as restrictions on use and break clauses. For example, in the case of a long term lease we will write into such leases an appropriate clause (forfeiture or break clause) under which the asset would revert back to the Council, such as:

In the case of bankruptcy/insolvency
In the case of corruption
In case of none payment of rent (if applicable)
In the case of none performance of other terms such as serious repairs and maintenance (if applicable)
The Council requires vacant possession of the asset as it forms part of a regeneration scheme
If the transfer agreement is breached
If the organisation wishes to develop and move into bigger premises.

What should the building be used for?

The council would expect each proposal to outline the current and proposed use of the building and how the asset transfer would enable and enhance the activities within the community.

We would expect that the proposals:

Demonstrate that the buildings will continue to support community and voluntary activities within the area and protect the use of the facility by other voluntary organisations
Outline the future opportunities for enhancing the use of the building as a community facility that transfer would bring
Identify opportunities for using the assets to develop and provide new and innovative services, which may be linked to current council service provision.