A guide to third sector trading - WCVA

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It’s an idea, but is it business? A guide to third sector trading 1: Getting started 2: First steps 3: Business planning 4: Legal and governance 5: Funding and resourcing 6: Financial controls 7: Managing growth 8: Management and governance 9: Social enterprise 10: Sources of support • Risk 3: Local authority lacks the capacity to support the asset transfer: − sharing the support role across service directorates − budgets for council support officers − arrange support from other bodies. Manage them. • Risk 4: Community organisation does not have the funds to purchase or refurbish the asset: − council commissions or funds a conditions survey, and assessment of fitness for purpose − group is provided with a financial picture for different transfer options − phasing any improvement programme − council retaining maintenance liabilities, or an endowment to cover maintenance − price reviewed in relation to proposed use and liabilities − transfer on lease with nominal rent, or council retaining tenure while the group manages the asset − recognising the value to the community organisation of a long lease or freehold sale. • Risk 5: Community organisation cannot afford to maintain the asset: − a long-term business plan − an agreed organisational development funded by the council − access for the group to on-going financial expertise and advice − shared repair options − 100% rates relief − use local procurement and tenancies to underpin revenue streams. • Risk 6: Lack of knowledge of an historic building asset: − council action to carry out initial condition research, − commissioning and retaining a surveyor/conservation architect/project manager. • Risk 7: State aid rules could prevent public financial support for a project: − explore exceptions on grounds of the minimum ceiling (200,000 euros), contracting rules, “permitted support” for social and economic projects, and local activity which would not affect trade between EU member states 186
It’s an idea, but is it business? A guide to third sector trading 1: Getting started 2: First steps 3: Business planning 4: Legal and governance 5: Funding and resourcing 6: Financial controls 7: Managing growth 8: Management and governance 9: Social enterprise 10: Sources of support − ‘permitted support’ includes culture, employment, environmental protection, research and development, regional development, undertakings in deprived areas, aid to SMEs and training, provision of social housing, improvements to physical environment and brownfield sites • Other possible risks which are also recognised and addressed: − asset not used in the public interest − fragmented ownership of council assets − possible confusion in roles between the local authority and the community organisation − limited potential for enterprise development − reliance on a small number of volunteers − use would not fit with wider strategic aims of the local authority. Further information The Asset Transfer Unit: The Asset Transfer Unit (ATU), which is based with the Development Trusts Association in London, provides a comprehensive CD-based pack of information and guidance materials to enable enterprises to take advantage of the approach. The unit offers information, advice and support on local asset transfer initiatives, tel 0845 345 4564, web site www.atu.org.uk, email info@atu.org.uk. The ATU pack: The information pack includes: • To Have and to Hold, the DTA Guide to asset development for community and social enterprises, a detailed handbook describing the processes of acquiring, developing and managing property assets • The Green Assets Guide on the environmental considerations of developing property assets, including energy and water conservation, waste reduction and recycling, key regulations and sources of information. • Managing Risks In Asset Transfer - A Guide, describing how the concerns of public authorities about the dangers of transferring assets to voluntary organisations can be confronted and the risks minimised • Official government guidance on the disposal of land and buildings • Charity Commission guidance on issues such as working with local government and managing property assets. • Background reports and materials to make the case for asset transfer. 187
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