The building sales and price rises Middlesbrough Council are considering to avoid bankruptcy
Middlesbrough Council are considering selling off several buildings and hiking public charges as officials seek to avoid bankruptcy.
The Town Hall is one of the buildings to have been called into question while other sites like TeesAMP business park, Middlesbrough House and Middlesbrough Municipal Golf Centre could be sold off.
Parking charges, licence fees and service charges could also increase from as early as next month.
A report given to the council's executive board has forecast an overspend of £8.5million for the second quarter of the year and the authority could be forced to issue a S114 notice, effectively declaring bankruptcy, if action is not taken.
An asset review report has revealed the proposed building sales would raise around £33m but would also reduce the council's long-term income of £1m a year. No jobs will be affected if the buildings are sold off.
The report asks the Executive to consider:
The use of the Town Hall in the long term to justify ongoing investment
The closure and sale of Middlesbrough House, relocating staff to Fountain Court and other council buildings.
Closure and sale of the Multi Media Exchange, relocating Middlesbrough Community Learning to the Cleveland Centre
The sale of Viewley Centre in Hemlington, relocating children’s services staff to other council buildings
Disposal of land east of Middlesbrough Municipal Golf Centre Driving Range and land on Stainsby Road in Acklam for housing development
Disposal of Cannon Park Car Park for commercial development
Disposal of the Middlesbrough Municipal Golf Centre and Zetland Street Car Park with appropriate covenants in place to secure their uses as a golf club and car park, respectively.
Council members have blamed "critically low levels" of revenue reserves for the financial situation while increased costs for a number of services have made it worse.
The report to the Executive said: “Economic conditions remain challenging, with the cost of living crisis having an impact across the economy including on residents, businesses and the council directly. The continuing high level of inflation is a significant factor in managing the council’s fragile financial position.
“This has significantly increased the costs of service delivery including energy, utilities, fuel, and food, and also staff costs as a result of the national pay award which has recently been agreed for all local government employees for 2023/24.
"The council has also incurred significantly increased costs from external service providers in areas such as adult and children’s social care, transport provision for children and adults, waste disposal, and temporary accommodation for homeless people.
“Local authorities received no government support towards the cost of inflationary pressures for 2023/24, which have continued to exceed the expectations at budget setting.”
The report also recommends that parking charges are increased in Zetland Street and Station Street car parks. Fines for fly-tipping and littering would also increase while licensing fees would also go up.
Examples of proposed increases in fees and charges:
Bereavement service – full internment from £726 to £788.40 (8.6%)
Professional hire of main hall within Middlesbrough Town Hall – £3,000 to £3,260 (8.7%)
Alcohol trader pitch fees at Orange Pip Market £160 to £174 (8.8%)
Houses in Multiple Occupation (HMO) licence from £665 to £722.290 (8.6%)
Cosmetic treatment licenses from £66 to £71.70 (8.6%)
Land hire fees for events £5,000 to £5,430 (8.6%)
Adult entry ticket for Captain Cook Museum £4 to £4.50 (12.5%) Children’s ticket £3.00 to £3.50 (16.7%)
Parking
Annual season ticket for off street car parking £665 to £772.20 (8.6%)
Annual season ticket for Zetland and Station Street ££435 to £472.40 (8.6%)
Short and long-stay car parking hourly charges will increase depending on the location by between 6.7 and 11.1 per cent.
Fines (subject to revision of the enforcement policy)
Fly tipping £400 to £1,000
Littering £80 to £500
Cllr Nicky Walker, Executive member for finance and governance, told the Local Democracy Reporting Service: “The asset review is necessary due to the critically low level of reserves we inherited from the year ending March 31 2023, the need to set a balanced budget over the medium term and the requirement to fund the transformation of services as set out by the external auditor.
“We are following statutory recommendations from the external auditor to review our ways of working, transform our services and identify how we will fund those changes. The fact that the Council’s level of revenue reserves is so critically low means there is no revenue funding available to meet these costs.”
The Executive will meet to discuss the report's recommendations next week while the draft budget for the coming year will be presented in December.
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