Liverpool City Region

Strategic Investment Fund – Skills Capital

Strand 4 – Maintenance of Further Education Facilities

Guidance Note

1Investment Strand 4 – March 2019

1. Introduction

This Guidance note sets out detailed information for applicants to the Liverpool City Region Skills Capital Strategic Investment Fund (the Fund).

Investment Strand 4: Maintenance of Further Education Facilities

Strand 4 (Maintenance of Further Education Facilities) is ring-fenced to Liverpool City Region General FE Colleges using an allocations methodology. The rationale for this is to ensure there is scope within the programme to address delivery facilities to ensure the estate continues to be fit for purpose and local community assets continue to be maintained. The Strand will not fund work that would normally constitute the usual “summer works‟, or planned maintenance or decoration i.e. works carried out under what would be reasonably considered as an on-going general maintenance programme or in-house by a college estates team.

The only exception to this would be “summer works‟, or planned maintenance or decoration that will be carried out by external contractors and applied as part of a wider package of maintenance work including major maintenance items e.g. a new roof, window replacement programme or structural maintenance works.

Investment Strand 4

Indicative Allocation

Description Minimum -Maximum Value of Grant

Eligibility

Maintenanceof FurtherEducationFacilities

£3.5m Maintenance of existingFE Colleges deliveryfacilities.

Proportional allocations methodology applied to total 2017/18 income sourced from financial accounts

General FE Colleges based in Liverpool City Region

In brief, the Fund is made up of 5 strands as follows:

Investment Strand

1. Sites and Premises2. Improved Facilities3. Equipment4. Maintenance of Further Education Facilities5. Low Carbon Reinvestment Fund

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This guidance note relates to Strand 4 only. Further guidance will be made available on the application process for the other strands.

For Strand 4 – Maintenance of Further Education Facilities and is ring-fenced to Liverpool City Region General FE Colleges using an allocations methodology. Should a Liverpool City Region based General FE college not use its full allocation, this will be re-invested by Liverpool City Region Combined Authority to support other skills capital projects.

It is strongly recommended that General FE College read in full the Skills Capital Prospectus and review the other strategic documents referenced within this document via the web links.

2. Scheme Overview and Eligibility

2.1 Strand 4 Overview

Strand 4 (Maintenance of Further Education Facilities) is ring-fenced to Liverpool City Region General FE Colleges using an allocations methodology. The rationale for this is to ensure there is scope within the programme to address General FE College delivery facilities to ensure the estate continues to be fit for purpose and local community assets continue to be maintained.

The Strand will not fund work that would normally constitute the usual “summer works‟, or planned maintenance or decoration i.e. works carried out under what would be reasonably considered as an on-going general maintenance programme or in-house by a college estates team. The only exception to this would be “summer works‟, or planned maintenance or decoration that will be carried out by external contractors and applied as part of a wider package of maintenance work including major maintenance items e.g. a new roof, window replacement programme or structural maintenance works.

2.2 Overall Eligibility Criteria

This Skills Capital investment strand is restricted to General Further Education (FE) Colleges based within the constituent six Local Authority areas within Liverpool City Region.

For the avoidance of doubt, the eligible General Further Education Colleges that can apply under Strand 4 are: City of Liverpool College, Hugh Baird College, Knowsley Community College, Riverside College, SK College, Southport College and Wirral Metropolitan College.

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2.3 Strand 4 – Maintenance of Further Education Facilities

The Maintenance of Further Education Facilities strand is designed as follows:

Description Improving General FE Colleges estates with evidence of poor building conditions and inefficient estates.

Eligibility See section 2.2.

General FE College Allocations

Maintenance of General FE Colleges to the total individual institutional allocations – (although cash and in-kind leverage of maintenance funding is expected except in exceptional circumstances).

The allocation methodology has been to apportion 25% of the overall funding for Strand 4 equally across all providers. The remaining 75% has been allocated based the proportion of LCR based General FE college income across all funding streams including ESFA, Student Loan Company and Office for Students as published in their financial accounts for 2017.

£ Allocation

Hugh Baird College £477,479.50The City of Liverpool College £901,942Riverside College £485,547.50Southport College £385,127SK College £760,563Wirral Metropolitan College £489,341Total £3,500,000

Intervention rate Cash and in-kind leverage of funding is expected except in exceptional circumstances.

Ineligible ItemsIn general, items such as furniture, software, general IT and telephony equipment are classed as ineligible under Strand 4.

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3. Appraisal Criteria

Section Four of the Combined Authority’s Investment Strategy (see website) describes the overarching SIF investment process. Project sponsors may refer to this section, and to the accompanying appendices, to understand the Combine Authority’s process in greater detail.

General Further Education Colleges Strand 4 proposals should be completed using the submission form set out in Appendix 1. The form and accompanying guidance notes are available electronically for download on the Combined Authority website: http://liverpoolcityregion-ca.gov.uk/documents

Completed submissions together with any supporting information should be emailed to SIF@liverpoolcityregion-ca.gov.uk

General FE Colleges are reminded that a key element of the assessment will be the deliverability of the project. Whilst it is recognised that at initial submission stage, further work is likely to be required – General FE Colleges are requested not to make a submission until they are ready to do so. Support from the SIF Investment Team is available to assist in this regard.

General FE Colleges are invited to identify information which they consider to be commercially confidential and the CA will treat such information accordingly. However, this cannot override the CA’s obligations under the Freedom of Information Act 2000 and/or Environmental Information Regulations 2004 (SI 2004 No. 3391).

For Skills Capital projects, the Combined Authority will use the following appraisal criteria in its assessment, based on the approach used to evaluate previous Skills Capital rounds. General FE Colleges will also need to identify the expected learning and skills related outputs and outcomes that their project will deliver.

4. Application Process and Notices

Each General FE College should complete no more than one Application through this Strand.

General FE Colleges should not enter into any agreements for maintenance until they have been advised that their application has been successful and have been made a formal funding offer by the Combined Authority.

General FE Colleges are reminded that the SIF Skills Capital funding will not provide increased capital grant should project costs exceed the approved amount. Furthermore, the Fund may not be in a position to pay grant for any costs incurred after 31 March 2021. However, this position will be clarified during the due diligence phase when an expenditure profile will be formally agreed. For the purposes of submitting your proposal, applicants must work on the principle that the majority of grant expenditure will be incurred and evidenced by 31 March 2021.

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In all cases, recipients of funding must comply with the current Public Contracts Regulations and European Commission (EC) Procurement Directives and adhere to their own procurement rules and regulations for the engagement of consultants and contractors.

General FE Colleges need to take steps including a letter of state aid legal opinion to satisfy themselves and the Combined Authority that any grant support funding payable under the Fund does not breach State Aid rules.

Before General FE Colleges receive any grant they will need to provide the Combined Authority with a formal written State Aid opinion from a solicitor, regulated in England and Wales who specialises in the EU State Aid rules, confirming in detail how the project complies with the EU State Aid rules, or a declaration to show that the grant is compatible State Aid as it is to be provided as De Minimis aid in compliance with the De Minimis Regulations.

5. Submission Requirements

In addition to this guidance note, information on how to complete the form is included within the Combined Authority Strategic Investment Fund – Skills Capital Prospectus itself. Sponsors / Applicants are required to meet the word limits that apply to each section of the form.

Taking into account the limited time available to carry out assessments and approvals of the Applications, sponsors / applicants are required to keep answers brief and to the point – word limits apply to certain sections of the form to help keep the process manageable.

The Combined Authority will assess Applications only on the information submitted in the required format.

General FE Colleges should complete the ‘Outline Submission for Support from the Liverpool City Region Combined Authority Strategic Investment Fund – Skills Capital Prospectus’ using the following tables within this section as a guide for completion.

6Investment Strand 4 – March 2019

Project Summary5.1 Project Summary Please provide a short summary of the project (Guide 200 words)

5.2 Strategy and Purpose Please describe your objectives in completing this project. How does fit into the Skills Capital Prospectus? (Guide 250 words).

What are your organisation and other project participants/stakeholders trying to achieve?

What will count as success? What financial objectives do you wish to reach? What learners will you engage and what volumes of learning will the increased capacity

from investment allow you to deliver per academic year.

Eligible applicants should consider and provide evidence of:

How the project contributes to meeting Liverpool City Region Skills Strategy 2018 and the needs set out in the current Skills for Growth Action Plans and/or a more diverse range of vocational and technical skills including those delivered through Apprenticeships and Traineeships;

Enhances learner engagement, and improves learner pathways, performance, success and achievement, including narrowing gaps in the participation and achievement of underrepresented learners.

Estate need, demonstrating that projects will ensure that General FE Colleges operate with estate which is:

o at least in “Good‟ condition and which is fit for purpose post Area Based Review;

o reduces operating costs (£/m2) over an investment period of 20 years and is versatile enough to efficiently accommodate changes in curriculum, social and economic needs and/or educational delivery;

o enhances learner engagement, experience pathways, performance success and achievement; and how it will support City Region skills priorities;

o deliverable with effective risk management processes and procedures.

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5.3 Development and Operation - Please provide details of the scope, scale and timing of project development, describe its operation on completion and what plans you have, if any, to exit the project after completion. Please include a table of costs. Guide 350 words.

Where you are considering more than one project delivery option, you may provide 150 additional words on each alternative and summarise the differences in a table. You may include maps, plans and graphics by appendix.

General FE Colleges may consider and set out:

A short, robust and measurable implementation plan including maintenance works to be funded and/or co-funded; sketches and floor plans;

Maintenance works deliverability within the proposed timescales; A statement setting out the low carbon benefits of the project.

5.4 Approvals, Consents and Authorisations - Please provide the material approvals, consents and authorisations you need to deliver and operate the project. You make provide brief commentary on your approach to securing these, including in relation to timing and dependencies / conditions.

Approvals, consents and authorisations may be internal (funding and resource) approval as well as external (like planning permission). For projects involving land and property; confirm ownership of land or route to ownership and confirm land value contribution Please provide letters of support (non-binding) from key stakeholders and detail the level of engagement with other public and private organisations and agencies.

General FE Colleges may consider and set out:

A timescale for maintenance; State aid legal letters of assurance and/or a timescale for provision of this; Internal governance approval for the commitment of co-investment; Letters of support from employers and other strategic stakeholders; Supporting evidence for any third-party project funding (if applicable) – for example if

available, award letters or formal letters of confirmation; The Principal / Chief Executive or his/her designated deputy must sign the

submission.

Development and Operation

5.5 Market, context and value Please describe the market in which the project will operate. The response to this question will differ across sectors. Skills projects are aimed at learners. There is no correct answer, responding will simply help the CA place your project in context.

For Skills Capital investment, the response may differ across sectors and the revenue source that

8Investment Strand 4 – March 2019

will be accessed to support learners e.g. apprenticeships/levy, 16-18 ESFA Study programme, AEB funded delivery. There is no correct answer, responding will simply help the CA place your project in context.

You may consider:

What/who are its end user learners, and/or other beneficiaries? What/who are its competitors and how duplication of provision will be avoided? What is the demand for the project and how competitive is the supply? What are its competitive advantages? If your project has a commercial value, what do you expect it to be and how did you

arrive at this value? If you expect the value to fall below the cost of delivery, why and by how much?

You may submit by appendix market analysis and valuation work completed to date, noting that the CA is likely to reach its own view. Guide. 300 words plus tables.

General FE Colleges should develop and articulate a clear delivery operational case and provide supporting evidence of how their project will:

Support delivery curriculum area of learning aligned to local demand for skills and economic needs;

Demonstrate versatility to efficiently accommodate changes in curriculum, social and economic needs and/or educational delivery;

Demonstrate that SIF maintenance funding will support learning over a sustained period and/or support the delivery of apprenticeships and traineeships.

5.6 Learning Volumes and Outcomes Please describe the learning volumes and outcomes that will be supported by the project and your current baseline volumes of delivery for this provision if applicable.

Learner funding

Baseline - Learner numbers before project [1]

Expected Learner Outputs per Academic Year

Total Learner numbers after project per annum after 3 years [2]

Change in learner numbers = [2-1]

Yr 1 (Additional learner enrolments)

Yr 2 Additional learner enrolments)

Yr 3 (Additional learner enrolments)

2018 - 2019

Insert Year 1 academic year

Insert Year 2 academic year

Insert Year 3 academic year

16-18 Apprenticeships (levy and non levy)Adult (19+)

9Investment Strand 4 – March 2019

Apprenticeships (levy and non levy)Adult Education Budget funded learners

Level 3 and above learners trained (not including apprentices)Traineeships delivered progressing into employment and further training (16-18 and 19-24)ESFA funded Study Programme learners (16-18)Higher Education (Office for Students funded) learnersOther technical skills delivered to learners

Total

5.7 Other Outcomes – Employment The total number of newly created and safeguarded permanent full-time equivalent jobs as a direct result of the intervention at predetermined employment sites. Employment sites include occupied newly developed commercial premises, the premises of supported enterprises, and any FE space directly improved or constructed by the intervention. Created and safeguarded jobs exclude those created solely to deliver the intervention (e.g. construction). A job is deemed as permanent if it lasts at least a year. Please include the number of apprenticeship positions created as a direct result of the intervention.

Employment Outcomes

Baseline - Learner numbers before project [1]

Expected Employment Outputs per Academic Year

Total employment number after project per annum

Change in employment numbers = [2-1]

Yr 1 (Additional learner enrolments)

Yr 2 Additional learner enrolments)

Yr 3 (Additional learner enrolments)

10Investment Strand 4 – March 2019

after 3 years [2]

2018 - 2019

Insert Year 1 academic year

Insert Year 2 academic year

Insert Year 3 academic year

Delivery jobs created/ safeguarded

Apprenticeship posts created

5.8 Other Skills and Education outcomes

Area of new or improved learning/training floorspace (m2)

The amount of "new build" training/learning floorspace constructed. Figures to be provided following completion.

The amount of training/learning floorspace refurbished to improve building condition and/or fitness for purpose. For FE

Colleges, this should be by estate grading. Figures to be provided following completion.

Prior Estate Grade (if applicable)

Condition graded by surveyor – A, B, C, D

Post Completion Estate Grade (if applicable)

Condition graded by surveyor – A, B, C, D

Floorspace rationalisation (m2)

The amount of overall floorspace reduced following completion of the project through, for example, demolition or disposal.

Figures to be provided following completion.

Number of New Learners Assisted (in

The number of new learners assisted as a direct result

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courses leading to a full qualification)

of the intervention, in courses leading to a full qualification.

Specialist Capital Equipment

Type of new specialist equipment -

Specialist equipment:

Resources specific to a particular sector or industry, and which are required in connection with that sector or industry’s production of goods and services.

These resources will usually comprise specific mechanical devices, but may include bespoke software, or a combination. Includes resources used to produce goods and services, as well as training resources unique to the industry (e.g. simulators). Does NOT include general equipment, IT infrastructure or resources used for several curriculum areas.

Other Capital Equipment

Non-specialist capital equipment (see above).

5.9 Funding – to establish value for money and affordability - Sources of funding – please complete the following table, adding lines and providing background information as necessary.

Where you are considering different options, please repeat this table for each option, noting that, if the CA accepts your project beyond the outline stage, its investment team will engage directly with you to structure a heads of terms for SIF financing.

You may also describe the key terms of the funding to be provided. Guide 200 words excluding tables

General FE Colleges should use the following table to demonstrate their project:

Delivers co-investment both cash and in-kind – unless there is a compelling business case including evidenced affordability;

Evidences that the necessary matched funding requirements can and will be met.

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Type of Funding Provided/Sourced by Sponsor

Request from SIF Total

[Item 1] £ %

[Item 2] £ %

Total £ £ %

Proportion of Total % % 100%

How the project meets the value for money through cost / benefit analysis; Where costs exceed planned estimates or the minimum cost option considered

how project cost changes will be managed and mitigated against, where cost reductions could be made to allow completion;

Provide a Planned Expenditure profile – required for maintenance.

5.10 Organisation and Personnel Please provide, with brief appendices if necessary, an organisation chart for the project including funders and key stakeholders, the proposed legal structure of the project and the biography of key project team members. Please also provide summary evidence, whether by reference to previous projects, case studies, corporate performance or other, of the sponsor’s and its team’s previous experience in delivering comparable and equivalent projects. Guide. 400 words plus charts. Please attach most recent Annual Accounts for your organisation (not required for public authorities).

5.11 Risks Please focus on the quality of risk assessment above the quantity of risks listed. Max.400 words. Applicants will need to provide details and clear evidence of:

The deliverability of the project and effective risk management procedures with effective risk management considerations, issues and mitigations against deliverability;

How the required co-investment will be realised within the timescales; How project cost changes will be managed and mitigated against, where cost

reductions could be made to allow completion.

Please provide a brief summary table of the main project delivery risks per the below:

Risk Probability & Impact Potential Mitigation

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[Risk 1] Select [low/medium/high] probability of risk occurring

Select [low/medium/high] negative impact on project delivery if risk occurs

[Risk 2]

[Risk 3]

[Risk 4]

5.12 Declaration

Please complete by appending your (the project lead’s) electronic signature below or by copying the declaration into the email submission of this form.

Signature...........................................................................

Name.................................................................................

Company name.................................................................

Position.............................................................................

Date....................................................................................

6. Application Submission

STAGE 1: CALL

Applicants are invited to respond to the calls by completing the outline submission application form.

The Adult Education Budget (AEB) Commissioning Team and Investment Team will arrange meetings throughout the process to agree in principle the approach to various aspects of the potential project. This includes an exploration of funding options and Monitoring and Evaluation approaches.

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6.1 Outline application submitted to SIF mailbox sif@liverpoolcityregion-ca.gov.uk

Submission Requirements: Important Information

General FE Colleges in Liverpool City Region must return one electronic copy of the signed and completed:

Application Form; Supporting information required, (as set out in the guidance note at Section 5 and

contained in the Application Form).

All documentation must be received by 4.00pm on 31 August 2019. (Please compress emails to less than 5Mb or send several emails and reference and number them clearly ensuring the organisations name is in the title of the e-mail).

For Strand 4, the Liverpool City Region Combined Authority does not initially require any hard copy information.

Without exception, the Liverpool City Region Employment and Skills Team will not accept any documentation that is submitted after the deadline of 4.00pm on 31 August 2019, or that fail to provide the information requested in full, as set out in this guidance document.

The SIF mailbox is managed and routinely checked by the Project Management Office (PMO) team. All applications receive an acknowledgement email by reply. The PMO will create a new Project file for each new application received. The PMO will check the application submission for completeness. And will go back to the applicant if needed.

The AEB Commissioning Team and Investment Team will solicit additional information from the applicant as required and will perform early checks as deemed necessary.

STAGE 2: CONCEPT

6.2 Outline Paper presented to the Internal Investment Panel

The AEB Commissioning Team and Investment Team Lead will produce an Outline Paper to be presented to the Internal Investment Panel meeting with judgements made against the criteria established in Appendix 1 of the investment strategy.

The applicant will receive an email providing relevant feedback. This may be accompanied by a phone call between the applicant and the AEB Commissioning

15Investment Strand 4 – March 2019

Team and Investment Team project lead. The project may be rejected at this stage or allowed to pass back though the outline review stage once more.

6.3 Delivery Options assessed

The AEB Commissioning Team and Investment Team Lead will put in place arrangements to agree in principle the approach to the project including an exploration of funding options and Monitoring and Evaluation approaches, delivery options/ alternative delivery models as a part of the appraisal process and assurance that these reflect the SIF assurance framework.

6.4 Draft Heads of Terms

The AEB Commissioning Team and Investment Team Lead will commence a process of negotiation with the applicant including a delivery timeline consulted on with PMO to ensure achievability.

6.5 Agree Due Diligence Approach and Commission ‘light touch’ economic appraisal and review results

The AEB Commissioning Team and Investment Team Lead to lead the scrutiny of a business plan, financial model and funding documents to review and raise concerns or omissions with the applicant. The Investment Team and procurement colleagues confirm scope/ requirements to procure an economic appraisal which will inform the prioritisation of projects.

6.6 Produce Concept Paper for External Investment Panel

The AEB Commissioning Team and Investment Team Lead to develop paper which is presented to the External Panel. The AEB Commissioning Team and Investment Team Lead share detailed and constructive feedback with applicant via letter (email). A follow up call may be necessary. If progressing to the next stage, and if not already raised, CA cost recovery details should be agreed with the applicant at this stage. The project may be rejected at this stage or allowed to pass back though the Concept review stage once more.

STAGE 3: INTERIM REVIEW

6.7 External (Interim) Investment Panel Review (Dependent on size of project)

For projects that are unusually large, complex, novel or protracted in negotiation. Where, following a Concept Review at the External Investment Panel, there are additional information requirements, new developments or other items to be explored, an Interim Review will be held to decide on whether to progress the project. What is presented at an interim review will constitute the project Outline Business Case (OBC).

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STAGE 4: FINAL REVIEW

6.8 Full Business Case (FBC) & Full Appraisal - Final Review

Projects with satisfactory diligence, heads of terms and external appraisal will be submitted for consideration at the final stage by the Investment Panel, which will provide final commentary to the Combined Authority delegated Director on the project’s merits. The AEB Commissioning Team and Investment Team lead will liaise with Procurement and the legal team to draft contracts.

Detailed and constructive feedback shared with the applicant via letter (email) from the Investment Team Lead. A follow up call may be necessary. The project may be rejected at this stage.

STAGE 5: DELEGATED DIRECTOR APPROVAL

6.9 Final consideration

Projects recommended for approval by the Investment Panel will be submitted to the Combined Authority delegated Director for final consideration. Projects approved, in principal will receive delegated authority for officers of the CA to enter into legal documentation and proceed to disbursing the SIF commitment. Projects that are rejected will receive reasoned feedback.

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