Purpose

Proposed decision –
 
That
the Cabinet Member for Economic Development in consultation with
the Deputy Leader and Cabinet Member for Finance, Corporate and
Traded Services:
 

(1) 
agree to £9.8 million of funding from the
Ministry of Housing, Communities and Local Government, be used to
award  grant funding to Local Planning
Authority partners to deliver mitigation schemes for Nutrient
Neutrality in the Stour catchment.

 

(2) 
DELEGATE authority to the Corporate Director of
Growth, Environment and Transport and Corporate Director of Finance
to take relevant actions including, but not limited to, finalising
the terms of, and entering into, required grant agreements as
necessary to award funding to Local Planning Authority bids for
mitigation schemes for nutrient neutrality in the Stour
catchment. 

 

(3) 
DELEGATE authority to the Corporate Director of
Growth, Environment and Transport in agreement with the Cabinet
Member for Environment, and Cabinet Member for Economic Development
to nominate an officer as an observer to sit on the executive board
of Ashford Borough Council and Canterbury City Council joint
venture company Stour Environmental Ltd which will deliver
mitigation schemes on their behalf.
 
 
Reason for the decision
 
Nutrient neutrality in
the Stour catchment is having a significant impact on the delivery
of homes in East Kent.
 

-   
Decision 24/00014 taken in March 2024 by the Cabinet
Member for Economic Development gave authority for KCC to enter
into Memorandums of Understanding to accept £9.8m capital and
£430,000 of revenue funding from the Department for Levelling
Up, Housing and Communities to support nutrient neutrality
mitigation works in East Kent to unlock the restrictions on housing
development.

-   
KCC as Local Planning Authority has received
£9.8 million (in December 2024) funding for mitigation works
and this funding must be committed to a programme by March 2025. It
is expected the funding will be awarded to Local Planning Authority
partners to deliver nutrient mitigation.

-   
Ashford Borough Council and Canterbury City Council
are establishing a joint venture company Stour Environmental
Credits Ltd a company limited by shares to deliver the nutrient
mitigation on their behalf and will be ready to deliver mitigation
schemes which will generate credits and be sold to release housing
development. It is expected the Joint Venture Company will be ready
to trade within the first quarter of 2025. KCC will nominate an
observer to the board of the Stour Environmental Credits Ltd
allowing it to have oversight of the governance and financial
arrangements of the joint venture company including how funding
awarded to them is used. As the Stour Environmental Credits Ltd is
currently in the inception process it is recommended that the
decision to nominate an officer to act as an observer to the board
be deferred. The nomination of an observer to the board will form
part of the grant agreement and the observer will provide no
direction or instruction to the board.

-   
  There are no
additional budget implications from the release of this funding.
However, KCC will be the Accountable Body, so part of this role
will be to ensure funds awarded are spent in line with the terms of
the grant determination letter.  A Grant
Agreement will be required between KCC and each LPA that bids for
funding to manage the financial risk if partners do not comply with
the terms of the grant.
 
 
Background – Provide brief additional context
 
KCC acts as the
catchment coordinator, a non-statutory role, for the Stour
Catchment Nutrient Neutrality. KCC has been working in partnership
with the districts to assess and identify mitigation measures for
managing nutrient levels within the Stour Catchment. Currently
housing development within the impacted districts cannot proceed
without the generation of nutrient mitigation credits which can
demonstrate that the nutrient loading within the catchment will not
increase as a result of further housing development.
KCC has been awarded
capital funding from the Local Nutrient Mitigation Fund for the
delivery of mitigation schemes which can offset nutrients and
generate credits. Districts will bid to KCC for funding to develop
and deliver mitigation.
 
Options:
 
Option
1: Award grant  funding to partners to
deliver mitigation schemes for Nutrient Neutrality in the Stour
catchment.- Impacted Local Planning Authorities will bid
to  KCC as catchment coordinator, for
Local Nutrient Mitigation Funding. The funding awarded to LPAs will
deliver mitigation measures, including but not limited to, septic
tank conversion, water efficiency retrofitting, wetlands,
agricultural reversion and floodplain meadow creation. The delivery
of these measures will generate credits which the LPA will sell to
developers to release housing. The returns from credit sales will
be recycled and invested in further mitigation
measures. 
 
Option
2: Do nothing - If KCC was to decide to take no action this would
prevent the delivery of high-quality locally led mitigation
solutions, and result in the housing allocation within the impacted
districts not being met. This would have wider implications of
negatively impacting economic growth within the county -
discarded
 
Option 1 is the preferred option. As
the catchment coordinator, KCC has a responsibility to address the
ongoing issue of Nutrient Neutrality in order to unlock housing
development in the area.
 
How the proposed
decision supports the
Framing Kent's Future
- Our Council Strategy 2022-2026
 

-     
The decision supports Framing Kent’s Future
2022-2026 priority 2 – Infrastructure for Communities, which
makes specific reference to our strengthening our capacity to
support strategic planning across the county to provide an
oversight of the county’s plan-led development and
infrastructure needs.

-     
Priority 3 – Environmental Step Change, which
makes specific reference to our environmental targets and objects,
compliance with legislation, protection of the environment,
reducing our impact to the environment, protection and enhancement
of biodiversity and ecosystems, sustainable resource use and
climate change mitigation and adaptation.
 
 
How the proposed
decision supports Securing Kent’s Future 2022
-2026:
Securing Kents Future
- Budget Recovery Strategy.pdf

-     
 

-     
The release of grant funding will not place any
additional burden on the budget and a legal framework will be
established to remove any financial risk to KCC through the
awarding of funds.

-     
The release of the funding will increase investment
within the county and support economic growth.
 
 

Decision

As Cabinet Member for Economic
Development I agree to:
 
(i)         AGREE,
in consultation with the Cabinet Member for Finance and Traded
Services to £9.8 million of funding from the Ministry of
Housing, Communities and Local Government, be used to award grant
funding to Local  Authority partners to
deliver mitigation schemes for Nutrient Neutrality in the Stour
catchment.
 
(ii)        DELEGATE
authority to the Corporate Director of Growth, Environment and
Transport in agreement with the Cabinet Member for Environment, and
Cabinet Member for Economic Development to nominate an officer as
an observer to sit on the executive board of Ashford Borough
Council and Canterbury City Council joint venture company Stour
Environmental Credits Ltd which will deliver mitigation schemes on
their behalf.
 
(iii)       AGREE to the
adoption of the Stodmarsh Nutrient Neutrality Strategy to support
the awarding of grant funding to Local Authority
partners.
 
(iv)       DELEGATE authority
to the Corporate Director of Growth, Environment and Transport in
consultation with the Cabinet Member for Economic Development to
take relevant actions including, but not limited to, finalising the
terms of, and entering into, required contracts or other legal
agreements, as necessary to implement the decision.