Early summer members update

Dear Members

This update covers the following issues:

• Ministry of Transport investigations
• Harbour sale
• Harbour offices still not paid for?
• Spring dredging
• BHT funds

Ministry of Transport investigations

The DfT investigation appears to be slowly progressing. With no further news we have to rely on the DfT’s statement:  “As I hope you can appreciate, this is quite a complex case for the department, and I hope that you do not take this lack of speed to mean that the department has disengaged from the case.”

This engagement is all the more important if any sale is likely. Any funds found to have been unlawfully removed from the Statutory Harbour Authority would be much more difficult to recover once a sale takes place.

Harbour sale update

We have credible suggestions that there is an interested party and that the seller’s aspirations run to £5,000,000 for a combined package of the Harbour and surrounding land and businesses.

It would be concerning if a buyer overpaid for the harbour and development opportunity. A high price could entail a correspondingly high expectation of return. This could lead to a desire to extract profits that are simply not lawfully available, and if extracted be wrongly diverted from harbour improvement. Valuation considerations include:

1.Under the Local Harbour Act the Statutory Harbour Authority cannot pay out profits beyond a reasonable return on share capital which currently stands at just £3,000.

2. Under the s106 planning legal agreement (attached to the planning permission for 13 houses) any development profits above 20% of sales must go to the Statutory Harbour Authority for improvements.

3. The s106 calculations on profits refers to a calculation where the cost of land is set out in existing use and prior to development. (I.e. not a higher purchase price based on an assumed enhancement of value attributable to the development’s planning permission).

These three facts set a mechanism by which the Harbour should be the major benefactor from it’s incomes and the “Enabling Development”.

Under these provisions it is difficult to see multi-million pound value.

Harbour offices still not paid for?

We understood that the liquidators of the contractor company would report towards the end of May. We have not seen anything published to date.

Spring dredging

In our last update we expressed some concern that this method of dredging would not see all the lifted silts leaving the harbour. Without a strong current to take the suspended particles away much of it is likely to settle inside the harbour.

Undoubtedly there was some improvement achieved in the long stay marina. However, hearsay evidence suggests the target depths of 2m at Mean Low Water were not achieved, with some boats grounding. The results of the post-dredge survey, if published, would be a useful guide.

BHT Funds

The work of the Trust remains as important as ever, as we finally make progress on financial redress. We thank you for your support to date, and ask for your continued financial support to keep going at this crucial time, in particular with professional advice to engage with the Department of Transport as required.

The Trustees