By Andrew Topping, Local Democracy Reporter
Mansfield District Council could borrow as much as £3.5 million to ensure a new health hub in Warsop can come to fruition, new papers have revealed.
The new facilities have been earmarked for the parish as part of the authority’s Towns Fund plans, with the Labour-led council successful in obtaining £12.3 million from the Government-led investment.
This is roughly half the £25 million total it was hoping to receive and follows a separate, unsuccessful £25 million bid for the Government’s Future High Streets Fund.
Part of the Towns Fund bid involved plans for the new Warsop Health Hub, with £3 million of the £12.3 million total to be invested in the facilities.
Latest estimates suggest the project is expected to cost £7.7 million to deliver – £1.7 million more than originally thought.
The authority says this is the result of “rising supply chain, labour and material costs”.
Once complete, the hub would boast a 15-metre swimming pool, changing facilities, a cafe and reception area, a fitness suite and a multi-purpose hall, and would be based within Carr Lane Park.
The council has previously stated the new site is not a direct replacement for the closed-down Meden Sports Centre.
Now new papers have outlined how the authority is going to fund the remainder of the multi-million-pound project.
Documents confirm the Labour administration is seeking £1-£1.5 million from Sport England to put towards the hub.
If the bid was a success, it would couple a £1.5 million investment from the authority’s reserves. This would be a requirement to enable the Sport England bid to be accepted.
A further £2-£3.5 million would be needed to fund the shortfall, with the borrowing level depending on funding secured from Sport England.
If the bid is not a success, it is expected the authority would need to borrow the full £3.5 million. Its own £1.5 million and the £3 million Towns Fund cash would make up the remaining funding.
Speaking in the reports, David Evans, the authority’s head of health and communities, said: “With £3 million of the total project cost having been secured to date, and a further £1-£1.5 million to be requested from Sport England, consideration has been given … as to how the shortfall will be covered.
“This has concluded that further funding totalling £1.5m is available to be allocated from earmarked reserves.
“Furthermore, any resulting shortfall would need to be covered by borrowing. The level of borrowing required is anticipated to be £2-£3.5 million, depending on the level of funding secured from Sport England.
“It is important to understand that a council contribution to the capital cost of the Warsop Health Hub project is an expectation and requirement of the Sport England funding process.
“The allocation of reserves, and the approval to borrow, is therefore necessary in order to ensure that the bid process can commence.
“Failure to do so would be a significant risk to the council’s success in securing Sport England funding.”
In the papers, Mr Evans also estimates how much the borrowing would cost the authority if it is taken out in either 30 or 40-year repayment periods.
The full £3.5 million loan taken over 40 years would cost the council £5.4 million, with annual costs totalling £181,062.
Taken over 30 years, this figure would reduce to £4.6 million with annual repayments of £189,554.
If the council was to borrow £2 million, a 40-year term would cost the authority slightly more than £3 million with annual repayments of £103,464.
A 30-year term reduces this to £2.8 million but would increase the annual costs to £119,662.
Councillor Stuart Richardson (Lab), the council’s portfolio holder for corporate and finance, is due to take a delegated decision on approving the funding and borrowing capacity next week.
In the meeting, on February 28, he is recommended to approve allocating £1.5 million in reserves and allowing the council to borrow a maximum of £3.5 million if it is needed.
The full business case for the health hub is currently being drafted, with the council expected to complete this work by the end of March.
