Issue details

21/00013 - Marsh Million - Next Stage

Proposed decision –

 

Kent County Council is seeking to close the Marsh Million scheme on 31 March 2021 and then return the uncommitted and recovered loan funds of the Marsh Million scheme to the original co-funders of the scheme (Magnox/NDA, KCC, Ashford Borough Council and Folkestone & Hythe District Council) on a pro-rata basis.

 

Reason for the decision -

 

Kent County Council currently manages the Marsh Million scheme. New funding approvals have not been made under this scheme since 2018. KCC is now seeking to close the scheme and allocate all the uncommitted and recovered loan funds to the original co-funders (Magnox/NDA, KCC, Ashford Borough Council and Folkestone & Hythe District Council) on a pro-rata basis.

 

Background

 

The Marsh Million scheme was established in 2013 as a £1 million economic growth fund for the Romney Marsh. The eligible area was designated parts of Ashford (Parishes of: Aldington, Appledore,  Bilsington,  Bonnington,  Kenardington,  Newenden, Orlestone,  Ruckinge,  Stone-Cum-Ebony,  Warehorne, Wittersham) and Folkstone & Hythe (Parishes of: Brenzett; Brookland; Burmarsh; Dymchurch; Ivychurch; Lydd, Newchurch; New Romney; Old Romney; Snargate; St Mary in the Marsh). The scheme was co-funded by the Magnox Socio?economic programme, a joint initiative between Magnox and the Nuclear Decommissioning Authority (£500,000), Kent County Council (£400,000), Ashford Borough Council (£50,000) and Folkestone & Hythe District Council (£50,000).

 

Eligible applicants included businesses, social enterprises, charities and public bodies. Funding was allocated equally (£500,000 grants and £500,000 loans) between two sub-programmes. 

 

         Marsh Million Economic Projects Scheme (EPS) which offered grants ranging between £10,000-£100,000 for projects seeking to help start-ups, small businesses and social enterprises in the Romney Marsh area to grow and diversify. Examples of such projects included training provision, environmental improvements (with an economic benefit) and tourism.

         Marsh Business Boost which offered 0% interest loans of up to £50,000 to help start-ups, small businesses and social enterprises in the Romney Marsh area who were seeking to develop new or expand existing products or services, where these would lead to sustained employment.

 

All applicants attended an Approval Board. This Board consisted of representatives of the co-funders, private and voluntary sectors and this Board will be stood down with the closure of the scheme. This Board made funding recommendations and KCC as the financially responsible authority endorsed these recommendations. KCC is responsible for receiving co-funder contributions, processing and appraising applications, entering funding agreements, making payments and ultimately collecting loan repayments and monitoring outcomes.

 

A final report on the impact of scheme was commissioned and completed in 2019 and was fully discussed by the Marsh Board. At the January 2021 Board meeting of the original co-funders (Magnox/NDA, KCC, Ashford Borough Council and Folkestone & Hythe District Council) agreed to close the existing scheme and return all uncommitted and recovered loan funds to the original co-funders on a pro-rata basis.

 

Options

 

KCC has looked at the option to maintain the Marsh Business Boost loan scheme. However, with a significantly diminished budget and with the ready availability of alternative loan funding from the Kent and Medway Business Fund and the No Use Empty scheme, the justification for maintaining a separate scheme is limited.

 

How the proposed decision meets the objectives of ‘Increasing Opportunities, Improving Outcomes: Kent County Council’s Strategic Statement (2015-2020)’

 

The decision supports the outcome “All Kent’s communities benefit from economic growth and lower levels of deprivation” as it will allow KCC to focus resources to deliver the Kent and Medway Business Fund and the No Use Empty scheme, which are seeking to deliver business investment, create new jobs and safeguard existing jobs on the Romney Marsh and other areas of Kent.

 

Financial Implications-

 

The scheme is closed to new applications and the funds currently available for redistribution to the co-funders is indicated below:-

 

Marsh Million Economic Projects Scheme (grant) and Marsh Business Boost (loan): Update January 2021

 

Loan £

Grant £

Budget

500,000

500,000

Committed

480,174

484,770

Not Committed

19,826

15,230

Loan Repayments

193,830

0

Outstanding Loan Repayments

238,420

0

Current Uncommitted Funding Available (Not Committed loans/grants + Repayments)

213,656

15,230

 

Based on KCC’s pro-rata investment (40%), £89,554.40 will be returned to KCC immediately (£2,000 will be retained by KCC to cover on-going recovery costs). Returned KCC funds will be allocated: a) as a contribution to the funding of the Romney Marsh Partnership post (£6,092); b) the balance to KCC’s general funds.  Future recovered loan repayments collected by KCC and will be returned to the co-funders every six months.

 

KCC is responsible for the recovery of outstanding investments, if these funds cannot be recovered by legal means, KCC is not responsible for any subsequent bad debts.

 

KCC Budget Book, the capital entry for the Marsh Million, Appendix B, Row Ref 27.

Decision type: Key

Reason Key: Affects more than two Electoral Divisions;

Decision status: For Determination

Division affected: Ashford Rural East; Ashford Rural South; Hythe West; Romney Marsh; Tenterden;

Notice of proposed decision first published: 26/01/2021

Decision due: Not before 24th Feb 2021 by Cabinet Member for Economic Development
Reason: To enable to decision to be on the FED for a minimum of 28 days.

Lead member: Cabinet Member for Economic Development

Lead director: David Smith

Department: Growth, Environment & Transport

Contact: Martyn Riley, Economic Development Officer (Expansion East Kent Programme) Tel: 03000 417161.

Financial implications:

Legal implications: KCC will continue to act as the financially responsible authority for the existing loan contracts. Invicta Law Ltd will continue to provide advice on contracts, insolvency issues and works with the KCC Business Investment Team to recover the maximum amount of loan value. KCC will continue to be responsible for monitoring and auditing under the terms of the existing contracts. Where businesses find themselves in difficulty and are unable to repay the loans on the agreed terms KCC can offer to restructure their debt to support further business growth and resume repayments. In cases of non-engagement, KCC will pursue loan recovery through Security or Personal Guarantees, where applicable. A detailed report from Invicta Law is not required at this time.

Equalities implications: An EqIA is being prepared for the Marsh Million scheme.