Farms Estate

Committee Minutes

Thu Feb 10 2011

Related Documents:
agenda for these minutes

Present:

Councillors Brook (Chairman), Bowden, Chugg, Lee, Taylor and Yabsley

Also Present:

Mr Latham (Tenants Representative) and Mr Glanvill (Devon Federation of Young Farmers Clubs Representative)

Apology:

Councillor Fowler

Members attending in accordance with Standing Order 25(2): -

Councillor Day

*FE/55 Minutes

RESOLVED that the Minutes of the meeting held on 17 November 2010 be signed as a correct record.

*FE/56 Mr Michael Bull

The Chairman welcomed Mr Michael Bull, an independent member of the County Council s Standards Committee. Mr Bull was present as part of a programme of independent members of the Standards Committee attending meetings to observe and monitor compliance with the County Council s ethical governance framework.

*FE/57 Revenue Budget 2010/11 (Month 8)

The Committee considered a report of the Director of Finance (CR/11/10 - text only | pdf supplementary information CR/11/10) on the County Farms Estate Revenue Budget 2010/11 (Month 8).

The Estate was projected to achieve an outturn surplus for 2010/11 of 244,900 which matched its target surplus.

It was MOVED by Councillor Brook, SECONDED by Councillor Chugg and

RESOLVED that the report be noted.

*FE/58 Usable Capital Receipts Reserve

The Committee considered a report of the Director of Finance (CR/11/11 - text only | pdf supplementary information CR/11/11) on the current position of the Usable Capital Receipts Reserve for the County Farms Estate.

The Reserve currently showed a surplus of 2,592,000 compared with a projected outturn of 3,476,000.

It was MOVED by Councillor Yabsley, SECONDED by Councillor Chugg and

RESOLVED

(a) that the report be noted;

(b) that the following proposed items of expenditure in 2010/11 be approved:

Tarrants Farm, Payhembury (land purchase) - 2000;

Kerswell Farm, Diptford (NVZs and proposed covered yard and cubicles) - 200,000;

Firsdon Farm, Ashreigney (Compensation) - 14,000.

*FE/59 Matters of Urgency

The Committee noted the action taken by the Chairman of the Committee, in accordance with Part 3 of the County Council s Constitution, in:

(a) approving in a letter of 19 November 2010:

(i) advertising Fairfield Farm, Denbury as a 125 acre or thereabout dairy starter holding to new entrants on the open market for a term of seven years commencing 25 March 2011 and terminating 25 March 2018, subject to terms being agreed;

(ii) offering the Denbury and Torbryan Allotments Association a fixed term licence/lease of part OS 7189 part OS 8700 extending to two acres or thereabouts in total, subject to terms being agreed;

(b) approving in a letter of 6 January 2011, a capital reserve of 70,000 to compensate the tenant of Endfield Farm, Sandford 66% of the approved cost of providing a tenants improvement NVZ compliant slurry store at end of tenancy (25 March 2013), subject to detailed terms and conditions being agreed and complied with;

(c) approving in a letter of 12 January 2011, declaring Venn Cross Farm, Landkey permanently surplus to the operational requirements of the Estate so that it can be sold to the sitting tenant for the sum of 400,000, subject to terms being agreed (NB. This resolution supersedes the decision referred to in Minute *FE/35 of 11 February 2010).

*FE/60 Review of Financial Institutions Lending Arrangements with Tenants

(Minute *FE/54(d)/17 November 2010)

The Committee considered a report of the Deputy Chief Executive (CR/11/12 - text only | pdf CR/11/12) on the outcome of discussions with an agricultural account manager of a bank with a significant market share of agricultural accounts in Devon about the apparent reluctance of banks and other lending institutions to provide unsupported borrowing to tenants seeking to progress into the private sector.

The report concluded that there appeared to be a willingness by banks to lend money to the agricultural sector although loan applications were rigorously scrutinised and would only be approved if the account managers were confident the loan was capable of being recovered. Prospective tenants and new entrants without a proven track record and limited collateral/equity in assets available to secure the loan were most likely to be worst affected by the increased caution evident in the lending market. The report referred to advice from agricultural account managers to help tenants maximise their credit rating and ability to secure essential borrowing.

It was MOVED by Councillor Brook, SECONDED by Councillor Chugg and

RESOLVED that the report be noted.

*FE/61 The County Farms Estate - Review of Standard Farm Business Tenancy Break Clauses (Minute *FE/50/17 November 2010)

The Committee considered a report of the Deputy Chief Executive (CR/11/13 - text only | pdf CR/11/13) on the outcome of discussions with an agricultural account manager of a bank with a significant market share of agricultural accounts in Devon about whether or not proposed tenancy break clauses might act as a disincentive to loans being made available to tenants.

The outcome of the discussions was that the proposed break clauses would not in themselves adversely affect a tenant s ability to borrow. A tenant s loan application review would take into account all risks and liabilities and the length of tenancy available would be considered no greater risk than most other external influences on the profitability of the business and ability to service the loan.

It was MOVED by Councillor Yabsley, SECONDED by Councillor Chugg and

RESOLVED that:

(a) that the following break clause be added to all new progression Farm Business Tenancy Agreements:

The landlord may bring this lease to an end at the end of any quinquennial anniversary of the commencement of the term by giving to the tenant at least twelve months notice in writing expiring at any such quinquennial anniversary ;

(b) that the protocol for triggering the proposed break clause referred to in Section 2.2 of report CR/10/99 - text only | pdf supplementary information CR/10/99 be adopted.

*FE/62 Management and Restructuring Issues

The Committee considered a report of the Deputy Chief Executive (CR/11/14 - text only | pdf CR/11/14) on County Farms Estate management and restructuring issues.

It was MOVED by Councillor Yabsley, SECONDED by Councillor Chugg and

RESOLVED

(a) that the 90.50 acres or thereabouts at Higher Wilminstone Farm, Tavistock be offered to the tenant of New Standon Farm, Bridestowe on a Farm Business Tenancy agreement commencing 25 March 2012 and terminating 25 March 2015, subject to terms being agreed;

(b) that the freehold interest with vacant possession of OS 9851 adjacent to the access lane at Tarrants Farm, Payhembury be purchased, subject to terms being agreed;

(c) that Part OS 1926 be amalgamated with Lower Farm, High Bickington and that the tenant of the holding be granted a supplemental Farm Business Tenancy of Pt OS 1926 for a term commencing 25 March 2011 and terminating 25 March 2018, subject to terms being agreed.

*FE/63 The Economic Viability of Small Scale Anaerobic Digestion

Consideration of this item was deferred in the absence of the Consultant who was due to make a presentation.

*FE/64 Bicton College Student Bursaries

The Deputy Chief Executive reported on bursaries that had been awarded to Bicton College students for 2010/11. The position was noted.

*FE/65 Tenants Association - Discussion of the Association s Formal Concerns

Following a discussion of the concerns raised by the Devon County Farms Estate Tenants Association in a letter of 12 January 2011 and reiterated by Mr George Dunn of the National Tenant Farmers Association in an email of 9 February 2011, it was MOVED by Councillor Bowden, SECONDED by Councillor Chugg and

RESOLVED as follows:

The Committee have considered the general concerns of the Tenants Association many of which, if not all, have previously been addressed by the Farms Estate Strategic Review Report in March 2010. In these difficult and financially challenging times, the Committee believe the Estate s long-term economic viability and future depends on tenants committing to the philosophy of the Review report and recommendations therein. Increasing evidence is emerging of tenants recognising and grasping the opportunity the new policy offers and it is therefore perhaps premature to suggest the new strategy is not delivering the required outcomes.

*FE/66 Tenants Farm Business Management Competition

The Committee considered a report of the Deputy Chief Executive (CR/11/16 - text only | pdf CR/11/16) on a proposed competition to promote the qualities and business acumen of existing tenants to the private sector as an additional means of achieving the aim of recommendation 13 of the Farms Estate Strategic Review Report (March 2010) endorsed by Cabinet on 14 April 2010.

It was MOVED by Councillor Brook, SECONDED by Councillor Yabsley and

RESOLVED

(a) that the proposal for a tenants farm business management competition be supported in principle;

(b) that consideration of the proposal be deferred to enable an application form template and judging criteria to be prepared so that Members can better understand the time, effort and possible cost required by tenants to apply and so that a reasonable prize fund can be agreed.

*FE/67 Exclusion of the Press and Public

RESOLVED: that the press and public be excluded from the meeting for the following items of business under Section 100(A)(4) of the Local Government Act 1972 on the grounds that they involve the likely disclosure of exempt information as defined in Paragraphs 1, 2 and 3 of Schedule 12A of the Act, namely information relating to, and which is likely to reveal the identity of, tenants and information relating to the financial or business affairs of tenants and the County Council and, in accordance with Section 36 of the Freedom of Information Act 2000, by virtue of the fact that the public interest in maintaining the exemption outweighs the public interest in disclosing the information.

*FE/68 Requests for Extension of Tenancy

(Councillor Chugg declared a personal interest in the item relating to Middle Winsham Farm, Braunton by virtue of being acquainted with the tenant)

(Councillor Sir Simon Day attended and spoke on the item relating to Higher Leigh Farm, Churchstow in accordance with Standing Order 25(2))

The Committee considered a report of the Deputy Chief Executive (CR/11/17) relating to requests from tenants for an extension to the term of their tenancy agreements.

It was MOVED by Councillor Chugg, SECONDED by Councillor Yabsley and

RESOLVED

(a) Middle Winsham Farm, Braunton

that consideration of the tenant s revised proposal be deferred to enable a site visit to be undertaken by Committee members;

(b) Nunford Dairy Farm, Colyton

(i) that the tenant of Nunford Dairy Farm, Colyton be offered a further but final 9 year Farm Business Tenancy of the holding for a term commencing 25 March 2013 and terminating 25 March 2022, subject to terms being agreed;

(ii) the length of tenancy offered is in keeping with current policy for starter holdings which allows a tenant to stay on a starter farm for a maximum term of 14 years;

(iii) the tenancy extension is granted so as to reward the tenant for making a capital investment in the holding supported by a sound business plan demonstrating that the investment will increase the holding s productivity and related earning capacity.

(c) Higher Leigh Farm, Churchstow

(i) that the tenant of Higher Leigh Farm, Churchstow be offered a further but final 4 year Farm Business Tenancy of the majority of the holding extending to 86.14 acres or thereabouts for a term commencing 25 March 2013 and terminating 25 March 2017, subject to terms being agreed;

(ii) that the tenant be offered a series of 12 month Farm Business Tenancies of the Combe Royal land amounting to 23.13 acres or thereabouts and more particularly known as OS 9006, 8596, 7003, 6595 and Pt 6185 on the same terms as the main tenancy until such time as any development potential has been secured or discounted or until 25 March 2017 whichever is the sooner;

(iii) the length of tenancy offered is in keeping with current policy for starter holdings which allows a tenant to stay on a starter farm for a maximum term of 14 years;

(iv) the tenancy extension is granted so as to enable the tenant to rebuild his business and end his period of occupation in no worse a position than he would have been had his business not been severely disadvantaged by a significant number of Bovine Tb culls and a personal injury for which he was not insured at the time;

(v) should the tenant of Higher Leigh Farm, Churchstow apply in open competition for the tenancy of Fairfield Farm, Denbury, he would not be treated as a new entrant from the commencement of the Fairfield Farm tenancy. It is therefore unlikely that a second 7 year tenancy of Fairfield Farm would be approved unless there were very good reasons for doing so. It is anticipated that the tenant would be able and willing to move to a progression farm during the seven year term tenancy being advertised.

(d) Endfield Farm, Sandford


(i) that the tenant s revised proposal for an extension of tenancy be rejected;

(ii) that the following Committee resolution of 15 July 2010 under Minute *FE/40(c) be reaffirmed:

(i) that the tenant of Endfield Farm, Sandford be offered a further but final 10 year Farm Business Tenancy of the holding for a term commencing 25 March 2013 and terminating 25 March 2023, subject to terms being agreed;

(ii) the length of tenancy offered is contrary to policy, but approved so as to reward the tenant for his commitment to share with the landlord the capital investment costs of making the Estate compliant with the NVZ regulations ;

(iii) that 66% of the approved cost of supplying and constructing a new tenant s improvement NVZ compliant concrete box slurry store with a minimum capacity (excluding freeboard) of 1720m3 be paid as compensation at 25 March 2013 and the residual 33% of the approved cost be treated as a tenant s improvement written down on a straight line basis to 1 in value by 25 March 2023, subject to detailed terms and conditions being agreed;

(iv) that should the tenant seek landlord s consent to construct a tenant s improvement cubicle shed to accommodate a further 40 cows then landlord s consent would be granted, subject to detailed terms and conditions being agreed and subject to any possible compensation liability not falling due until the tenant vacates the holding.

(NB. The tenant of Endfield Farm, Sandford and his wife were invited into the meeting to be notified of this decision)


(e) Buckridge Farm, Denbury

that consideration of the tenant s proposal be deferred to enable a site visit to be undertaken by Committee members.

(f) Churchlands Farm, Ermington

(i) that the tenant of Churchlands Farm, Ermington be offered a further 7 year Farm Business Tenancy of the holding for a term commencing 25 March 2012 and terminating 25 March 2019, subject to terms being agreed;

(ii) the length of tenancy offered is in keeping with current policy for starter holdings which allows a tenant to stay on a starter farm for a maximum term of 14 years;

(iii) the tenancy extension is granted so as to reward the tenant for making a capital investment in the holding supported by a sound business plan demonstrating the investment will increase the holding s productivity and related earning capacity.

*FE/69 Breakthrough Plus Business Plan and Tenancy Request

Consideration of a report of the Deputy Chief Executive (CR/11/18) relating to an expression of interest from the Charity Breakthrough Plus Ltd to rent buildings and land to relocate their rural based service was deferred as the business plan requested from the organisation had not been received.

*FE/70 Greenhills Farm, West Anstey

The Committee considered a report of the Deputy Chief Executive (CR/11/19) relating to the business case for disposing of this holding.

It was MOVED by Councillor Yabsley, SECONDED by Councillor Lee and

RESOLVED

(a) that the tenant s proposed short surrender of Greenhills Farm, West Anstey be accepted;

(b) that 68.13 acres of land or thereabouts forming part Greenhills Farm, West Anstey and more particularly described as OS 2519, 3622, 4329, 5235, 6129, 3500, 4600, 5200, 5400, 6100, 4786, 5273, 4756, 4648, 4940 and 3639 be declared permanently surplus to the operational requirements of the Estate so that it can be sold to the tenant simultaneously to the tenancy surrender referred to in (a) above, subject to terms being agreed;

(c) that the Greenhills farmhouse, buildings and 21.86 acres of land or thereabouts and more particularly described as OS 2047, 2948, Pt 2257, 2862, 4063, 4075 and 3987 be declared permanently surplus to the operational requirements of the Estate and sold;

(d) that 19.87 acres of land or thereabouts forming part Greenhills Farm, West Anstey and more particularly described as OS 2327, 3226, 4623 and 3009 be relet back to the tenant on a five year Farm Business Tenancy Agreement commencing 29 September 2011 and terminating 29 September 2016, subject to terms being agreed.

*FE/71 Bad Debts

The Deputy Chief Executive reported on rental arrears on the County Farms Estate and action being taken in relation to the debts involved. The Committee noted the present position.

*DENOTES DELEGATED MATTER WITH POWER TO ACT

The meeting started at 2.15pm and finished at 5.25pm

The Minutes of the Farms Estate Committee are published on the County Council s Website at: http://www.devon.gov.uk/dcc/committee/mingifs.html

Date Published: Wed Mar 16 2011