Agenda item

The Regeneration Project Delivery Manager presented the Levelling-Up Fund Programme – Quarterly Update to the Board as follows:

• The Windsor Street site was discussed and as of the 15^th of January, all the buildings on the site had been demolished.  The removal of the gas pipe in November had added a six-week delay to the project and incurred City Demolition’s standing time costs which were agreed at circa £118k.   
• Brownfield Solutions had reviewed the contaminated materials and installed monitoring wells as part of the remediation strategy.  Ground water monitoring had commenced in February 2025 and would continue until mid-August 2025.
• Further to the testing of two zones for contaminated material detecting 14 exceedances, the programme would be extended due to the analysis turnaround time.
• Thomas Lister had been appointed to support with the development appraisal that would inform the options paper. Officers had also engaged with Homes England to discuss potential funding streams, if the Council decided to develop the site.  Homes England confirmed that they could only provide funding for affordable housing above the policy requirements.
• Whilst the gas pipe removal added a six-week delay to the demolition programme, the project was continuing to progress in line with timescales and remained to be on track to be delivered by January 2026.
• The key risks affecting the project were contaminated land with further investigations required during the works, working adjacent to occupied buildings and right of way (easement across site).
• The Public Realm Works site was discussed.  Worcestershire County Council (WCC) were responsible for the design and delivery of the Public Realm element of the project, given their statutory responsibilities. Final prices were agreed and linked to a Memorandum of Understanding (MOU) that existed between Bromsgrove District and Worcestershire County Councils who were delivering the works.
• Both the works on the High Street and on Chapel Street had been completed with an updated Risk Register provided to Members.
• The Council had requested a lesson learned workshop to be held with WCC.
• The Former Market Hall Site was discussed.  The main contract with Kier was signed on 29^th October 2024.  The main construction programme had commenced in November 2024.  Piling was completed at the end of December 2024 and groundworks had commenced in January 2025.
• During the Pre-Construction Services Agreement (PCSA), significant quantities of ground obstructions were discovered, leading to delays in the formal commencement of the main contract.
• Minor delays of six weeks had been incurred due to ground obstructions and Kier had formally submitted a claim for ground obstructions, loss and expenses.  The QS from Arcadis had reviewed the claim and considered it reasonable.
• Kier had provided the cash flow forecast.  Whilst the programme had a revised end date of January 2026, the Levelling-UP Fund (LUF) monies would be spent by the September 2025 deadline.  Officers had also received confirmation that BDC had an extension period until the end of March 2026 to spend the LUF money.
• In January, the LUF Board agreed to directly appoint Arcadis to provide employer agent and quantity surveyor (QS) services for RIBA stage 5. Following a recommendation from the project manager, it was agreed that carrying out a procurement exercise would carry too much risk as another supplier may not provide a lower fee proposal.  Due to the value of the contract, an urgent decision was taken.
• A Clerk of Works was appointed on behalf of the Council and would carry out site inspections twice a month for building works and for mechanical and engineering (M&E) works. 
• The project team had held a design meeting to agree the layout of the commercial building. It was agreed that the first and second floor office space would be split into two units, following advice from local agents, GJS Dillon.
• Following a procurement exercise, GJS Dillon had been appointed as the agents for the commercial building who would be preparing a marketing strategy and advertise the space as well as handle lettings on behalf of the Council. This was agreed by LUF Board Members in December 2024.
• The project team were preparing an Expression of Interest (EOI) to Birmingham City Council for the Greater Birmingham and Solihull Local Enterprise Partnership (GBSLEP) monies totalling £2.45m. Following the EOI being accepted, the project manager would prepare the full business case for submission.  However, BDC were informed that Birmingham City Council were unable to provide any Local Authority funding until 2026/2027 financial year, therefore, BDC may be required to utilise short-term borrowing to complete the FMH project until funding could be drawn down.

Following consideration of the item, the Board made the following comments:

• When would the right of access be reinstated on Windsor Street? – In response it was advised that City Demolition were preparing quotes for reinstatement.
• If statutory responsibilities between the Council and Worcestershire County Council could be formerly agreed and considered.
• What the additional costs for provisional sums and contingency included in the project budget were referring to? – The Board noted that this was in relation to predicted budget fees.  A fees and tracker survey carried out in 2022 reviewed the professional fees incurred such as design, architecture and list surveys.  The original budget for RIBA 5 and 6 services for Arcadis QS was set at £180k, however the revised fee was for approximately £220k.  Officers were confident that there shouldn’t be a necessity for any further surveys, however, contingencies were in place.
• Members expressed concerns that Birmingham City Council were unable to provide any Local Authority funding until 2026/2027 for the Greater Birmingham and Solihull Local Enterprise Partnership (GBSLEP) monies and that the Council may be required to consider utilising short-term borrowing to complete the FMH project until funding could be drawn down. Members had raised concerns during previous meetings but had been reassured that withdrawing the funds would not be an issue. – In response the Assistant Director of Regeneration and Property Services advised that the matter would be investigated further to review the legal framework and recent correspondence received from Birmingham City Council.  Members would be updated on progress in this matter.

RESOLVED that the Levelling-Up Fund Programme – Quarterly Update be noted.

(During consideration of this item, Members discussed matters that necessitated the disclosure of exempt information. It was therefore agreed to move to exclude the press and public prior to any debate on the grounds that information would be revealed Information relating to the financial or business affairs of any particular person (including the authority holding that information)).