Agenda item

To consider a report by Councillor Brian Jones, Cabinet Lead Member for Waste, Transport and the Environment (copy enclosed) on the proposal for a coastal defence scheme at East Rhyl.

RESOLVED that Cabinet –

(a)       confirms that it has considered the content of the Well-being Impact Assessment (attached at Appendix 1 to the report);

(b)       supports the proposal to progress the scheme to the construction phase, using the grant aid funding model set out by the Welsh Government, and recommends to Council that the proposal be approved, and

(c)        recommends to Council that authority be delegated to the East Rhyl Coastal Defence Scheme Project Board (the Project Board to be established following confirmation of Cabinet approval to proceed to the construction phase) to deliver the scheme, as long as the final target cost does not exceed £27.5m.  The project should be brought back to Council for further consideration should the final target cost exceed £27.5m.

Councillor Brian Jones presented the report on the proposal for a coastal defence scheme at East Rhyl and sought Cabinet agreement to the scheme and funding requirements and to recommend to Council accordingly.

East Rhyl was the Council’s highest priority area for a coastal defence scheme given that it was more likely to experience severe flooding than anywhere else in the county.  In making the case for the proposed scheme Councillor Jones referred to the devastation of the December 2013 floods and future vulnerability of the area in terms of flood risk.  An investigation into the 2013 floods showed that properties could be flooded during a 1 in 20 year event and the scheme would provide an appropriate standard of flood protection for approximately 1650 properties with a defence against a 1 in 200 year event.  However the cost of the project was estimated at £27.5m and would place an additional revenue burden on the Council.

Details of the estimated revenue implications and financial assumptions based on current borrowing rates had been detailed within the report.  Councillor Julian Thompson-Hill supported the recommendation and confirmed that the Strategic Investment Group had approved the scheme.  In terms of the financials he highlighted the change to the funding regime and revenue impact of that change.  Whilst the scheme was eligible for 75% Welsh Government grant funding the Council would be expected to fund the whole amount, with 75% of the cost of borrowing repaid to the Council annually via the Revenue Support Grant over 25 years.  A contribution of £6.87m was required from the Council and the majority of that funding would need to be borrowed (£2m general funding had already been earmarked for the scheme) at an estimated cost of £29k in 2020/21, £205k in 2021/22 rising to £286k a year from 2022/23.  Assuming the revenue budget position did not improve the repayment amount would have to be ring-fenced which would impact on future savings/cuts.

Cabinet accepted that a case had been made for the project from a flood defence perspective given the significant risk to the community and further considered the funding element and financial implications of progressing the scheme, noting the long term commitment required in terms of repayment of the loan and impact on the revenue budget.  The following issues were further discussed –

·         Councillor Mark Young queried the risk of overspend given that Welsh Government would not consider requests for increased grant where costs had increased above the approved sum and it was confirmed the Council would be liable for any overspend.  However the risk had been mitigated by using a robust procurement framework which resulted in a high level of cost certainty and £4m risk contingency had been built into the £27.5m budget with an allowance for inflation; subject to Council approval the works would commence in April 2020

·         Councillor Bobby Feeley highlighted other areas within the county prone to flooding and queried the impact on funding other flood schemes given the substantial funding required in this case.  Officers reported upon flood management in other areas of the county, including both coastal and fluvial schemes which were at various stages in development and would be progressed via the Programme Board.  It had been suggested that a Flood Risk Project Board be established to oversee the East Rhyl scheme and also to consider options for other schemes. The scheme would be brought back to Council for further consideration should the final target cost exceed £27.5m

·         in recalling the devastation of the 2013 floods Councillor Tony Thomas spoke in favour of the scheme, highlighting the potential threat to life and destruction of property from future flooding events and the need to protect the community

·         Councillor Mark Young sought assurances regarding community benefits arising from the proposed scheme and officers confirmed that element was referenced within the report and included in the procurement framework

·         officers responded to questions from Councillor Meirick Davies advising that the Shoreline Management Plan supported the actions of the proposal, reference to which could be included in the Council report.  It was also confirmed that reducing the scope of the scheme would reduce the standard of protection

·         Councillor Barry Mellor spoke in support of the scheme, commending the way the Council dealt with the 2013 floods, and he felt the Council should be more proactive generally in relation to flood issues.  Councillor Alan James also spoke for the scheme highlighting the wellbeing and financial impact on residents

·         in terms of timescales, should Cabinet be minded to support the recommendations, a report would be submitted to Council on 10 September.

RESOLVED that Cabinet –

(a)       confirms that it has considered the content of the Well-being Impact Assessment (attached at Appendix 1 to the report);

(b)       supports the proposal to progress the scheme to the construction phase, using the grant aid funding model set out by the Welsh Government, and recommends to Council that the proposal be approved, and

(c)        recommends to Council that authority be delegated to the East Rhyl Coastal Defence Scheme Project Board (the Project Board to be established following confirmation of Cabinet approval to proceed to the construction phase) to deliver the scheme, as long as the final target cost does not exceed £27.5m.  The project should be brought back to Council for further consideration should the final target cost exceed £27.5m.