Published: 09:34, 20 November 2019
| Updated: 09:35, 20 November 2019
A staggering £100m is needed to kick start the divisive Otterpool Park development.
Hythe's proposed garden town is destined for land on and around the former Folkestone Racecourse, close to the villages of Westenhanger and Newingreen.
Pending planning approval, it will include 10,000 new homes, a fifth of which will be affordable, schools, green spaces, health centres and retail and leisure facilities, and will be built over 30 years.
Now, new documents reveal that Folkestone and Hythe District Council (FHDC), who are behind the project in partnership with Cozumel Estates, need to borrow £100m in order to proceed with the scheme.
This is on top of the £19m the authority has already budgeted for the project, with £11m being spent to date on buying 357 acres of land south east of the racecourse for £5m and more than £3m purchasing Westenhanger Castle, which covers the price of the landmark at £2.9m, plus tax and legal fees.
Cabinet members are now seeking approval from full council to go ahead and apply for the loan.
Described as prudential borrowing, the money would come from the Public Works Loan Board, which issues loans to local authorities and is itself funded by HM Treasury.
Council papers state: "This report makes the case that cabinet should recommend to council that additional capital funding of £100m be made available to enable the project."
It continues: "The financial analysis undertaken focuses on the project as a whole, with the council acting as master developer.
"It assumes the council would acquire the whole site and sell serviced plots to house builders.
"The scheme will be funded through prudential borrowing. The council would not borrow in advance of need, and therefore it is not proposed that the council would borrow £100m immediately."
The sum requested will be spent on early infrastructure works, such as feasibility studies, waste water treatment works, new roads and investment in the green spaces including a public park surrounding Westenhanger Castle.
The document reads: "In addition the sum authorised will provide sufficient financial headroom to enable the council, if it sees fit, to acquire further land.
"Other immediate costs include establishing a delivery vehicle and team together with preparing reserved matters planning applications for early phases."
Part of the report also looks at why the council has decided to build at Otterpool Park. It states: "As an area for development Otterpool Park almost chooses itself."
It adds that the "Garden Town project is seen as a unique opportunity" that will boost the local economy, increase job opportunities and provide more homes.
A section of the literature also seeks to explain why the council wants to invest in Otterpool.
It is outlined that "local government finance is under pressure" and must "seek other sources of funding to sustain its expenditure".
The report states: "Whilst the council will seek to make a profit from its investments and act in a commercial way it should be appreciated that the profits will be used in one way or the other to support public expenditure across the district."
A second recommendation in the report notes that decisions on spending the money will be given to an appointed 'decision maker', although in cases in excess of £100,000 the decision will be subject to the approval of a newly created 'Working Group'.
FHDC will also seek a bid for a Garden Communities grant of £1.973 million.
The report will be discussed by cabinet members tonight at their meeting at the civic centre in Castle Hill Avenue at 5pm, and then again by full council at 7pm.
More by this authorSam Williams