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Community right to challenge and bid

Under the Localism Act, there are two new rights available to local people. The first; right to challenge, gives local people the opportunity to become more involved in running local services, and the second; right to bid, gives local communities greater ability to protect local buildings and land that are valued as community assets.

The ‘Community Right to Challenge’ is the new Community Right under the Localism Act 2011 which allows ‘Relevant Groups’ voluntary, neighbourhood and community groups, charities, parish councils, and local authority staff to challenge to run local authority services where they believe they can do so differently and better, demonstrating value for money and social benefits.

Successful challenges can trigger a decision to seek prices to deliver the service on the open market. This process provides an opportunity for communities to help shape local services for the local community, but does not mean that the organisation that challenges will be successful in running the service. This is because once a challenge is successful the running of a service will be open to competition from the public, community and private sector.

Before you apply, use this pre-completion expression of interest (EOI) checklist.

This checklist is provided to ensure that potential submission/s meet key criteria from the outset, which we hope will not only assist applicants, but ensure the process is both effective and efficient in saving time and effort.

1) The submitting organisation/individuals meet the relevant body Criteria

Should you answer “No” to any of the questions listed, this may indicate that you do not meet minimum criteria or that there are likely to be shortcomings that need addressing prior to submitting an expression of interest.

2) The expression of interest will be submitted within the time period 1st July – 31st July as specified by the council

3) The geographical location and service to be delivered to be contained in submission is identified and clearly scoped

4) Financial capacity can be evidenced sufficient to delivery service upon which bid is based

5) If successful, the relevant body has capacity to participate in a procurement exercise

6) The relevant body is able to demonstrate they have sufficient resources and experience to deliver the service

7) The relevant body understands that a successful EOI does not give the relevant body the right to delivery service and acknowledges that this will be subject to a competitive procurement exercise in the open market procurement exercise in the open market

8) The relevant body can identify within their service delivery model, community and social benefits and demonstrate value for money, as part of a competitive tendering process

9) The relevant body understands that surplus profit achieved from service delivery over and above meeting overheads of the business, are to be reinvested to sustain and improve service benefits to the Community

You are ready to complete an Expression of interest application

If you require assistance or further clarification please contact the Procurement Unit, Tel no. 01843 577112 who will be able to identify the appropriate officer to assist with your enquiry.

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Community Right to Bid is part of the Localism Act and its aim is to give local communities’ early warning of the sale of land and buildings they have identified as having community value to enable them to bid to buy them.

It requires the council to maintain a list of buildings and other lands in its area which are of community value, and ensures that when such land is sold local groups will have the opportunity to delay the sale to enable them to prepare a bid to buy it.

Community Right to Bid does not restrict who the owner of the listed asset sells to, the price the owner sells at or what the owner can do with the property once listed.

Getting an asset listed

Parish councils and local voluntary and community bodies can nominate local land and buildings to be included in the List of Assets of Community Value.

For an asset to be listed, the nominee has to demonstrate that its main use now, or in the recent past (usually within the last 5 years) contributes to the social wellbeing or cultural, recreational or sporting interests of the local community – and that this use will continue.  Examples could include:

  • village shops,
  • pubs,
  • community centres and playing fields.

Buildings used as private residences, offices and areas which haven’t had public access will not be included.

The council has produced guidance notes to help communities interested in nominating an asset. A nomination has to contain certain information, so a nomination form has been produced to ensure submissions comply with the requirements, please use it.

The District Council considers each submitted nomination form and supporting evidence and decides whether the asset is and/or will be of ‘community value’ and therefore should be listed.  This can take up to 8 weeks and during this time the parish council, ward councillors, owners, leasers, occupants and people with a legitimate interest will be informed of the request to list.

When an asset is listed some restrictions on the owner come into force; when the owner decides to sell the asset they must inform Thanet District Council and an initial period of 6 weeks is provided to allow a community interest group (charity or body with a legal identity of their own separate from members) to register an interest in making a bid to purchase the asset.

If the community decides not to submit a bid, then the owner is free to dispose of the asset on the open market. When an interest to bid is registered the asset can not be sold for 6 months. This 6 months moratorium period starts from the date the owner informed the council they want to sell the asset. This time gives the group an opportunity to develop a proposal and raise the finance to bid for the asset. During the moratorium period the asset can not be disposed of unless to the community group.

It’s important to note that the listing serves only to give a window of time for groups to prepare to bid alongside other potential buyers.  The sale takes place under normal market conditions and the owner is under no obligation to sell to the community group.  Equally, community groups which have registered an interest to bid are under no obligation to purchase.

If the owner does not receive a bid from the community or does not accept the offer during the 6 months moratorium period then the owner is free to dispose of the asset on the open market for a further 12 months, at the end of which the whole process begins again, if the property has not been sold.

Other sources of information and advice:

1. The legislation website has the legal documents. The explanatory memorandum to the regulations (No. 2421) is a good place to start.

2. HM Government Community Rights website has case studies and outlines the process and the steps a community group will need to do to take advantage of the legislation.

3. Locality is an independent national network of community-led organisations that is a source of advice and publications for community and local groups, including the publication To Have and to Hold, The Development Trusts Association guide to asset development

4My Community Rights website has support and advice on Community Right to Bid and asset transfer, plus possible grants. It is run by Locality.

5Asset Transfer Unit, delivered by Locality, has guidance on how to take assets and land into community ownership and run them successfully. The guidance covers: getting started, getting investment ready, taking a stake in an asset, property development and property management.

6. The Charity Commission is a source of information on setting up and running charities. The model governing documents are a good model for constitutions.

7. Land Registry is a source of information on who owns property and maps of the property.

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The Community Right To Bid Act requires assets of community value to be publicly listed.

Examples of assets of community value could be pubs, shops, libraries and community facilities, although not every example of these facilities will qualify. A shop in Broadstairs High Street would not be considered to further the community’s social wellbeing or interests in the same way as a single shop in a small village.

Properties registered as assets of community value in Thanet

Nominations not registered as assets of community value in Thanet

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