2.00 Site Registration Stage
2.01The purpose of the site registration stage - is to prevent unnecessary duplication of effort by two or more Associations investigating the development potential of the same site. From 1 April 2007 the site registration stage is mandatory. This allows one Association time to investigate the site’s potential, reducing abortive work in the preparation of schemes to the minimum. In this respect, it is in the interest of Associations to liaise closely with the Northern Ireland Housing Executive (NIHE) on the location of potential development sites.
2.02Registration of sites - cannot be made by telephone but Associations may make telephone enquiries to the NIHE (DPG) as to whether a site is already registered with another Association before making a written site registration application.
2.03On finding a site - the Association should consider its suitability against the Association’s objectives and in terms of the allocation(s) it has received, or may expect to receive in the future. Before submitting the application for registration the Association must first satisfy itself that the NIHE supports in principle the proposals in relation to formal support for housing need and that the vendor is prepared to negotiate with the Association in cases where the property is not on the open market.
2.04Applications for Site Registration (Procedures)
(a) Reason for the Application.
To allow one Association time to investigate the potential of an identified site/property.
(b) Action by the Association – Application to the NIHE (DPG) for Site Registration.
Submissions must include:
- Form S1 (See Annex A and Note (i) below);
- Site Location Plan (scale 1:1250 or 1:2500) – see Note (ii) below;
Notes:
(i) Form S1 - this form is the key document in the site registration process and should be completed as comprehensively as possible. Clear indication must be given as to whether the registration is for New Build or Rehabilitation or whether it is a combination of both and the full address, including the postcode and the names of all roads abutting the site, must be given to avoid potential duplication of registrations. (For combination schemes both the new-build and rehabilitation boxes should be ticked and the word ‘and’ inserted between the boxes on this form and other relevant forms. It should be noted that combination schemes are schemes with distinct new-build and rehabilitation elements which could ‘stand alone’ for scheme and programme purposes and must not be confused with normal rehabilitation schemes with a new-build element).
(ii) Site Location Plan - The boundaries of the site should be clearly marked in red on the plan. The nature of the surrounding development should also be identified. The purpose of the plan is to assist accurate identification of the site. The inclusion of the Ordnance Survey grid reference is also useful to the NIHE (DPG). The plan should also either have the licence number or Ordnance Survey acknowledgement on it.
(iii) Purchase of Public Sector Land - If a private treaty purchase of public land is involved, e.g. from NIHE, DHSSPS, DRD, a letter of agreement in principle to the disposal from the relevant body must be submitted along with Form S1.
(c) Action by the NIHE (DPG)
After checking that the Association is registered under Article 16 of the Housing (Northern Ireland) Order 1992, the NIHE (DPG) will consider the application against existing site registration records. The NIHE (DPG) response to the application will be indicated on the return part of form S1 (see Annex A) and will be one of the following:
a. Registration -if no prior registration exists the NIHE (DPG) will register the site in the Association’s name.
b. Re-registered
c. Prior registration - if another Association’s interest in the site has already been registered.
d. Rejection
If the application is successful a site will normally be registered in the Association’s name for one year. If at the end of this period an application for Project Approval has not been made, the NIHE (DPG) may cancel the registration. Where a request for an extension of the registration is received from an Association before the expiry date, the NIHE (DPG) will consider the request in terms of the probability of successful acquisition and development of the site by the Association. In exceptional circumstances the NIHE (DPG) may recommend that the site registration is transferred to another Association.
2.05Area Based Strategies – the NIHE (DPG) may allow, in certain circumstances, a change to the site registration process with the introduction of area-based housing strategies. In these particular instances the site registration is mandatory with registrations accepted on a first come - first served basis. The registration process should mean the avoidance of nugatory work by Associations and minimize unnecessary competition between Associations thereby preventing the inflation of the market value.
3.00 Applications for the Advanced Acquisition of Land
3.01This facility was first introduced in 2003 - and amended some of the Housing Association Guide requirements for the approval of schemes and payment of grant to Associations undertaking acquisition & new build developments. The purpose of the amendment is to facilitate Associations acquiring, in advance, the land element of schemes in Years 2 or 3 of the Programme.
[Note: The Advanced Land Purchase facility does not apply to Package Deals, Works Only and Off-the-Shelf schemes.]
3.02By way of background - under the previous arrangements, an Association required project approval in order to access the Acquisition Tranche from the DSD. At project approval stage TCI/approved costs are fixed and normally can only vary in a cost overrun situation. This situation is acceptable when the Association is likely to be in a position to apply for the Start on Site stage within a reasonable time. However, if there is likely to be a protracted delay, the Association can be at a disadvantage as the building costs may increase during this period.
3.03For this reason - some Associations may be reluctant to seek project approval and acquire the land until the Start on Site Stage is reasonably assured. However, this can delay the scheme, or put the scheme at risk, as landowners may be unwilling to wait while the Association seeks the normal approvals required for a successful Start on Site Tranche application. Given the increase in development activity in Northern Ireland, protracted delays in obtaining Planning and other statutory approval are not unusual. In some cases, the Association may be in a position to acquire the land, but it can take up to one or two years before the Start on Site position is reached.
3.04The amendments introduced in the Guide were intended to:
- Facilitate the advanced acquisition of land – [thus securing the land for development and reducing the possibility of the Association losing the site];
- Reduce the risk on the Association of increased building costs during any protracted delay from Acquisition stage to Start on Site stage – [by allowing the Association the Acquisition Tranche to acquire the site, and for the TCI/scheme costs to be recalculated prior to the start on site stage]; and
- Ensure that as far as possible, any risk to Public Funds is minimised – [by amending the procedures and introducing new ‘prequalifications’ requirements etc, intended to safeguard the Association’s and the NIHE (DPG)’s resources].
3.05Generally - Para 3.04 above will be achieved by the Association making an application for the advanced purchase of land for a scheme in Year 2 or Year 3 of the 5-year Social Housing Development Programme (SHDP), using TCI/Grant Rates applicable at the time. If the NIHE (DPG) approves the application, the Association can access the Acquisition Tranche to acquire the land. When the Association is in a position to ‘Start on Site’ the normal project approval application will be made using the TCI/Grant Rates applicable at this time. Any new Acquisition Tranche calculation/claim will have the previous advanced acquisition Tranche payment deducted as a Public Subsidy.
3.06Associations should note - that in the unlikely event where grant has been paid for the advanced acquisition of land, but where the scheme cannot proceed, the Association will be expected to sell the site in accordance with the requirements as previously set out in Housing Association Circular HAC 02/94. An Association that wishes to dispose of any land or buildings under any other circumstances must submit details of its proposals to the DSD. The submission should include the current market value of the land or buildings as reported by an independent qualified valuer. It should also include details of the method by which the Association intends to ensure that it receives the best consideration for the disposal. In practice these requirements have been deemed to mean that the Association must test the market by placing the land for sale on the open market. If satisfied, the DSD will issue its “consent in principle” to the disposal and advise the Association of the need for DSD endorsement of the lease. When the lease has been prepared by the Association it should be sent to the DSD for formal endorsement. In such cases, the NIHE (DPG) will recover funding from the Association in the normal manner.
[Note: In the advanced acquisition of land from a contractor/developer as part of a Design & Build Package Deal (see 3.01 above) the contractor/developer may be reluctant to sell the site to the Association if, in the event of NIHE support being withdrawn, the Association is required to place the site on the open market. In such circumstances the contractor/developer may have a strong claim against the Association for the cost of nugatory work, loss of profit, etc. If as a condition of sale to the Association the contractor/developer insists on a 'buy-back' clause this can be included. This should be in the following form: "In the event of the Association deciding not to proceed on need grounds, the contractor/developer has first option to buy back the site at market value, minus his expenses. However, if agreement cannot be reached on what is a reasonable market value, the Association retains the right to sell on the open market".]
3.07Application for the Advanced Acquisition of Land - the procedures to be followed by Associations in such cases are listed below at 3.09. Associations should note that the scheme position must meet preliminary development parameters including prequalifications. Advice on meeting the various Prequalifications applicable is included at Annex N.
3.08Advanced Acquisition of Land Funding - Funding for the advanced acquisition of land became available from 1st October 2003. Since that date Associations have been able to make valid applications for Grant in accordance with the terms for Grant. As the amount of Grant available may be limited, approvals by the NIHE (DPG) will normally be made to Associations on a ‘first come’ basis. Any future selection process will be subject to further consultation with the Northern Ireland Federation of Housing Associations.
3.09Applications for the Advanced Acquisition of Land (Procedures):-
(a) Reason for Change
To enable Associations to acquire land for programmed schemes at the earliest possible opportunity.
(b) Programme Position
Housing need must be already identified and site/scheme included in the SHDP (Year 2 or Year 3).
(c) Action by the Association
The Association, being content that the site is suitable and can accommodate the identified housing need, must be able to confirm that the scheme meets the certifications and prequalifications applicable to Advanced Acquisition Schemes (see Annex N for advice on meeting the various prequalifications).
(d) Application to the NIHE (DPG) - for approval for the Advance Acquisition of Land.
The submission must include:
All Schemes:
- Economic Appraisal;
- Copy of NIHE letter supporting need, (also copy of the Association’s letter of request to NIHE);
- Form APL1 (See Annex B);
- Form SFN1 (See Annex F);
- Copy of valuation prepared by independent valuer and an accompanying plan, endorsed by the valuer (i.e. signed and dated), that clearly identifies the site/property valued;
- Location plan (1:1250 or 1:2500). The plan should contain either the Association’s licence number or Ordnance Survey acknowledgement;
- Site layout plan (1:200 and in sketch form only).
Schemes over TCI (Non-tariff Schemes Only):
- Association’s reasons for the scheme exceeding TCI and cost breakdown;
- Report on adverse ground/structural features; *
(e) Action by the NIHE (DPG)
The NIHE (DPG) will consider the application and approve, reject or request additional clarification where appropriate. The NIHE (DPG) approval will be on Form APL2 (See - Annex C).
(f) Action by the Association – Schemes approved for the Advanced Acquisition of Land.
The Application for the Acquisition Tranche should comply with the requirements of 7.01(b) and 7.01(e) if relevant.
(g) Action by the NIHE (DPG)
The NIHE (DPG) will pay a valid/approved application for the Acquisition Tranche to the Association in accordance with 7.01(c).
(h) Action by the Association - Within 30 working days of Grant being paid
The Association must provide the NIHE (DPG) with confirmation that the land is now in the Association’s ownership (See – 7.01(d))
3.10Application for Project Approval - when the Association is in a position to consider the Start on Site stage, an application for Project Approval should be submitted to the NIHE (DPG) at the earliest possible opportunity. The procedures to be followed for Project Approval, where an Advanced Acquisition has been agreed and claimed, are listed below at 3.11. Associations should note that it is at Project Approval Stage that any change from the original proposals must be reconciled. Associations should also note at (a) below, the time limits for seeking Project Approval following the advanced acquisition of land stage and the need to keep the NIHE (DPG) advised of any delay to the programmed date for start on site stage. Any deferment beyond the programme date will require NIHE (DPG) approval and the possible revaluation of the land for TCI/Grant purposes.
3.11Applications for Project Approval following the Advanced Purchase of Land Stage (Procedures)
(a) Time Limit for Approval - from the Advanced Acquisition of Land to seeking Project Approval.
The NIHE (DPG) expects Associations to apply for project approval in time to meet the programmed target date for the start on site stage. The Association should immediately advise the NIHE (DPG), if for any reason, it is unable to fulfil its commitment to start on site. The NIHE (DPG) may require revaluation of the site for TCI/Grant purposes if there is any undue delay on the programmed start on site stage.
(b) Action by the Association -for Project Approval following the Advance Acquisition of Land.
[Important Note: It is at this stage that any change from the original proposals will need to be reconciled. Associations should explain what changes, if any, have occurred and the reasons for the change. For example an increase/decrease in the number of dwellings being proposed or changes to the type and sizes of dwellings. Associations should note that changes to the need will require a revised letter of support from the NIHE].
The Association, being content that the site is suitable and can accommodate the identified housing need, must be able to confirm that the scheme meets the certifications and prequalifications applicable at Project Approval stage (See 4.12 (c)). Submissions must include:
All Schemes:
- Economic Appraisal;
- Only if applicable, Copy of NIHE letter on revised support for the need, (also copy of the Association’s letter of request to NIHE);
- Form SN1/TA1 (See Annex D and above in respect of the purchase price of the land);
- Form SFN1 (See Annex F - revised and updated from previous where necessary);
- Location Plan (1:1250 or 1:2500);
- Site Layout Plan (1:200);
- Block Plans (1:100) (i);
- Dwelling Plans (1:50) including sections, elevations etc;
- Outline Specification.
Schemes over TCI* (Non-tariff Schemes Only):
- Association’s cost breakdowns and reasons for the scheme exceeding TCI;
- Report on adverse ground/structural features; *
- Copy letter from a Consultant or Employer’s Agent confirming that the scheme represents value for money.
[*Note: this will only apply where the scheme is over TCI and exceeds the (TCI) figure used for the Advanced Acquisition of Land. In such cases the Economic Appraisal must include an option to dispose of the site].
JMA Schemes Only:
- Copy letter from JMA Partner confirming agreement in principle to enter into a JMA.
(c) Action by the NIHE (DPG).
The NIHE (DPG) will consider the application and approve, reject or request additional clarification where appropriate. The NIHE (DPG) approval will be on Form SN2 (See - Annex E).
(d) Action by the Association – on Schemes given project approval, following a previous payment of Grant for the Advanced Acquisition of Land.
Application for (revised) Acquisition Tranche and the Start on Site Tranche – the Association must be able to confirm that the scheme meets the certifications applicable at Start on Site stage (See 8.04 (a)) and include the information listed at 8.04 (b)
(e) Action by the NIHE (DPG)
The NIHE (DPG) will pay a valid/approved application for the Acquisition Tranche and the Start on Site Tranche to the Association in the normal manner. The previous Grant paid for the Advanced Acquisition of Land will be deducted from the Tranches as a Public Subsidy Deduction (See Annex R). After this stage, the scheme will be treated as normal in respect of Practical Completion Stage, cost overrun etc.
(f) Action by the Association – Within 30 working days of Grant being paid
The Association’s attention is drawn to the need to provide the NIHE (DPG) with confirmation on progress, and information to be used to monitor movements in building costs. The procedures to be followed are at 8.04(d).
4.00 Project Approval Stage
4.01The purpose of the Project Approval assessment is:
- To evaluate the scheme proposals in terms of housing need, value for money and financial viability; and
- To establish whether the NIHE (DPG) is prepared to support the proposed scheme costs in full or in part.
4.02Total Cost Indicators (TCI) - are the cost guidelines, which assist the NIHE (DPG) to reach decisions on value for money. The cost of the development proposed is compared to the DSD’s Total Cost Indicators, a matrix of total scheme cost norms, which takes account of scheme type. Details of current TCI are published in Appendix: 8 to Part 1 of this Guide.
4.03Grant Rates - details of the fixed rates of grant available are published in Appendix: 9 to Part 1 of this Guide. The Grant rates can be modified on a scheme basis to reflect scheme type cost factors. Once the Grant percentage for the scheme has been established at Project Approval the proportion of approved scheme costs to be met by the NIHE (DPG) is set. The same percentage of Grant, therefore, will apply to any cost overruns agreed at Final Cost Assessment.
4.04Package Deals, Off-the-Shelf Schemes and Works Only projects - special arrangements exist in respect of the payment of grant for certain Package Deals, Off-the-Shelf and Works Only schemes. Associations should refer to Appendix: 8 to Part 1 of the Guide (Definitions of scheme types are also included at Annex P).
4.05Auctions and Tenders - where the proposed purchase is via auction or tender, the NIHE (DPG) approval will take the form of a letter of approval, in principle only. If the Association is successful at auction/tender it should also confirm to the NIHE (DPG) forthwith so that a full Project Approval may be issued. The Association should state on its Project Approval application the date by which a decision is required. The NIHE (DPG) will normally need a minimum of 7 working days to consider the application for Project Approval.
[Note: The Association should be aware that it will normally be expected to execute the contract immediately following a successful bid at auction. It should therefore obtain from its solicitors confirmation that the title offered is satisfactory and that the conditions of sale permit the proposed development. It should also be satisfied that it can meet any conditions of the approval in principle. The Association needs to be aware that it is working at risk without any formal commitment from the NIHE (DPG).
4.06Acquisition of Tenanted Property - in normal circumstances an Association will wish to improve properties which are acquired with sitting tenants as soon as it is practicable to do so.
Occasionally however a tenant will be unwilling to move out of the property and it will be impossible to undertake the improvement works. In some cases the Association is aware of the problem at the outset, before buying the property, in other cases the situation will not become apparent until a later stage. In either type of case the Association incurs initial costs upon which interest continues to accrue for an indefinite period. To resolve this problem the following alternative procedures can be used:
- Where the Association is aware at the outset that the tenant will not move and that improvement works cannot be effected within 18 months of completion of property purchase, the Association may apply for Project Approval as if the property were an Off-the–Shelf purchase. Instructions on completing the documentation are given at 4.13 to 4.15. Claims for grant following Project Approval will adopt the Off-the-Shelf format (See 6.03); or
- Where the Association has proceeded under the terms of a full acquisition and improvement scheme, but has been unable to improve the property within 18 months of completion of property purchase, the NIHE (DPG) will review the case and will ask the Association to confirm the proposed Start on Site date. If the Association is unable to confirm a date for Start on Site, the NIHE (DPG) will reassess the scheme as if it had been originally presented as an Off-the-Shelf purchase (paragraph (i) above) and will re-determine grant. Details of the procedure are given under Revised Approvals (See 5.01b).
When the property is eventually available for improvement the Association will make a new project approval application for a Works Only scheme following the instructions at 4.13 to 4.15. The outstanding loan will be brought into the grant calculation as part of the project approval.
4.07Historic Land and property purchases - in cases where an Acquisition and Works scheme is submitted for Project Approval, but where the land/property has already been acquired by the Association – i.e., acquired by the Association prior to the programme year without using HAG funding - it is necessary to determine an eligible acquisition cost for inclusion in the total approved costs figure, against which grant is determined. The maximum eligible acquisition cost will be the current value of the land or property, as confirmed by the District Valuer or an Independent Qualified Valuer, and valid at the date of Project Approval. There can be no exceptions to this rule (e.g., if it would be more advantageous to the Association to use actual acquisition cost because values have decreased), and Associations will be expected to obtain an up-to-date valuation in the case of all such historic acquisitions.
4.08Investment Decisions - there is no time limit between the date of any original acquisitions by an Association and the date of any subsequent application to the NIHE (DPG) for Project Approval. If Associations make speculative purchases they do so at risk and cannot thereby expect to pre-empt the NIHE (DPG) investment decisions. As the NIHE (DPG) is not able to guarantee future funding, Associations are expected to accept the risks involved in making purchases, which may subsequently not turn out to be justified or supported.
4.09Donated Land - the above revaluation facility will not apply in cases where land or property has been donated to the Association rather than having been acquired with its own resources. It would not be appropriate for Grant to be used to realise for Associations the full value of the land or property donated in this way. Associations will be asked to confirm in the case of historic acquisitions that the land or property has not been donated to them. Similarly the revaluation facility will not apply if the Association wishes to transfer schemes or parts of schemes, which have already been approved to a different scheme type.
4.10Economic Appraisals - see guidance in Annexes U and U (i). From 1 April 2006, economic appraisals must be submitted, both electronically and hard copy, to the NIHE (DPG) for all schemes requiring Project Approval. The economic appraisal must be signed off and dated by the author and approved by an officer or member of the Association authorised by the Management Committee.
Associations should be aware that the principle of commensurate effort applies in undertaking any economic appraisal i.e. the resources to be devoted to appraisal should be in proportion to the scale or importance of the objectives and resource consequences. As a general rule, no more than 2% of the total scheme costs should be expended on the preparation of an economic appraisal. (There are likely to be many cases where an economic appraisal will cost substantially less than 2% of the total scheme costs e.g. where the objectives are obvious and options are very limited). Associations may request exemption from the normal NIHE (DPG) requirements for economic appraisal if a scheme falls into one of the following categories:
- A competent authority (such as the NIHE or a Health and Social Services Trust) has undertaken a recent economic appraisal for housing development on the site; or
- Where the scheme is one phase of a bigger project for which an overall economic appraisal has already been undertaken.
Such requests for exemption should be discussed with the NIHE (DPG) at the earliest possible stage.
[NB:
- Associations should note that Department of Finance & Personnel (DFP) approval is also required for schemes with costs that are in excess of £10m.
- In the case of Supported Housing schemes, Associations must include a Memorandum of Understanding from either DHSS&PS or a Health Trust that recognises the level of commitment over the lifetime of the scheme and also gives a commitment of support. The Memorandum of Understanding should also include specific funding details.
- The Association must undertake monitoring and post-project evaluation in accordance with the guidance contained in Annexes U and U (i).]
4.11Making an application for Project Approval - when an Association has identified a suitable site/property which can be economically developed, taking account of the cost criteria, grant rates and design and procurement requirements specified in this Guide, an application for Project Approval should be made to the NIHE (DPG). In cases where the Association submits a scheme for which the land/property has already been acquired, prior to the programme year, it is necessary to determine an eligible acquisition cost for inclusion in the total approved costs figure, against which grant is determined (See 4.07).
4.12Project Approval Stage (Application Procedures)
(a) Reason for the Application
To obtain the NIHE (DPG) approval to the scheme and scheme costs, and to confirm the grant-aid that will be available to the Association.
(b) Programme Position
Housing need must be already identified and site/scheme included in the Social Housing Development Programme (SHDP).
(c) Action by the Association
The Association, being content that the site is suitable and can accommodate the identified housing need, must be able to confirm that the scheme meets the certifications below and prequalifications applicable to the Scheme type (see Annex N for advice on meeting the various pre-qualifications):
a. It has undertaken consultation on the proposals as required by Appendix: 3 to Part 2 (Annex W) of the Housing Association Guide;
b. It has the vendor’s agreement of terms;
c. The purchase price does not exceed the value of the property as assessed by an independent qualified valuer;
d.It is satisfied that rental income will cover operational costs including repayment of loan principal and interest;
e. It has obtained or will obtain long-term private finance (mixed funded schemes only);
f. It will, where giving security to a lender in the form of a charge over land, comply with the DSD’s requirements in respect of Article 13 of the Housing (Northern Ireland) Order 1992;
g. It has an offer of development capital/has resolved to use its own reserves (mixed funded schemes only);
h. It will meet the cost of any shortfall on capital or revenue funding, including the cost of any non-qualifying items;
i. No capital contributions (including other public subsidy) exist/details of capital contributions are supplied;
j. The Scheme meets the Supported Housing eligibility criteria, if applicable (See Part 5 of the Guide) and the Association has an offer of support in-principle from the NIHE;
k. Where the scheme is to be managed in partnership with another body, the Joint Management arrangements conform to the DSD’s requirements;
l. Any necessary topping-up funding can be obtained;
m. The scheme will comply with the DSD’s Design and Procurement Requirements;
n. Works cost forecasts are based on technical consultants’ estimates and no non-qualifying items are included in the costs for grant funding;
o. It will insure and keep insured for the accommodation provided its full replacement value, both during and after the development;
p. Any material divergence from the development timetable will be reported to the NIHE (DPG) forthwith (a divergence of 3 months or more is material);
q. No member, employee, agent or consultant of the Association has any interest in the proposed vendor, contractor, or the land or property to be acquired. This declaration extends to any firm, partnership or organisation in which they or their families are involved as partner, director or shareholder. (If such a declaration cannot be made without reservation, a statement should be attached giving a full disclosure of the interest of the people concerned);
r. It has carried out an economic appraisal of the proposed development;
s. It has outline or full Planning Permission or has satisfied itself, after consultation, that the proposed use of the site and it’s proposals will be generally acceptable to the Divisional Planning Office etc, subject to the issue of full planning permission; and
t. To the best of its knowledge and belief, the contents of this application are complete and accurate.
Certifications (a) & (b) are not applicable in the case of works only projects where the land or property is already in the Association’s ownership.
THE ABOVE CERTIFICATIONS ARE MADE BY THE ASSOCIATION IN APPLYING FOR PROJECT APPROVAL. THEY ARE SUBJECT TO AUDIT. APPENDIX: 4 TO PART 2 OF THE GUIDE EXPLAINS THE PROCEDURES FOR AUDIT AND THE DOCUMENTATION THAT ASSOCIATIONS MUST HOLD ON FILE TO SUPPORT THE CERTIFICATIONS MADE. WHERE THE ASSOCIATION IS UNABLE TO MAKE ANY OF THE CERTIFICATIONS REFERRED TO ABOVE – UNLESS IT IS NOT APPLICABLE TO THE SCHEME - IT SHOULD AMEND THE CERTIFICATION AND PROVIDE DETAILS ON THE FORM OR IN A COVERING LETTER.
(d) Application to the NIHE (DPG) - for Project Approval
Submissions must include:
All Schemes (including Disposals Proceeds Fund schemes):
- Economic Appraisal;
- Copy of NIHE letter supporting need, (also copy of the Association’s letter of request to NIHE);
- Form SN1/TA1 (see Annex D);
- Form SFN1 (see Annex F);
- Copy of valuation prepared by independent valuer and an accompanying plan, endorsed by the valuer (i.e. signed and dated), that clearly identifies the site/property valued (i);
- Site Location Plan (1:1250 or 1:2500). The plan should contain either the Association’s licence number or Ordnance Survey acknowledgement;
- Site Layout Plan (1:200) (i);
- Block Plans (1:100) (i);
- Dwelling Plans (1:50) including sections, elevations etc. For rehabilitation, existing and proposed plans, including sections, are required. The scale must be adequate to enable assessment, if required;
- Outline Specification;
- Condition Report (Existing Satisfactory Purchases (ESPs) only).
Schemes over TCI (Non-tariff Schemes Only):
- Association’s cost breakdowns and reasons for the scheme exceeding TCI;
- Report on adverse ground/structural features; *
- Copy letter from a Consultant or Employer’s Agent confirming that the scheme represents value for money.
Package Deals Only:
- Copy letter of offer from Developer/Contractor;
- Copy letter from the Employer’s Agent confirming that the Developer/Contractor is competent and experienced and not a Developer only.
JMA Schemes Only:
- Copy letter from JMA Partner confirming agreement in principle to enter into a JMA.
Re-improvement schemes:
- Confirmation from any lender of outstanding loans as the anticipated date of Principal Completion.
(e) Action by the NIHE (DPG) – at Project Approval Stage
The NIHE (DPG) will check that:
a.Sufficient financial allocation is available for the Association and for the project; and
b.The application is complete, correct and signed by an authorised signatory; and will advise the Association of the Scheme Reference Number (SRN) allocated to the scheme. This should be referred to in all future correspondence concerning the scheme.
If satisfied with the submission the NIHE (DPG)’s approval will be on Form SN2 / TA2 (See Annex – E) and will confirm:
a.The TCI that applies to the scheme (adjusted for any area SPA);
b.The total scheme costs that will qualify for grant;
c.The maximum cost overrun figure that can be approved, subject to scrutiny, at Final Cost Assessment:
d.The grant percentage which will apply to the scheme;
e.The total amount of grant available;
f.The amount of grant on account to be dispensed at each stage.
(f) Action by the DSD – at Project Approval Stage
DSD will confirm, where appropriate for mixed funded schemes, approval in principle to the Association obtaining a mortgage for the development and/or the completed scheme.
* = If relevant.
(g) Action by the Association
The Project Approval (Form SN2 / TA2 - See Annex E) will set out any conditions attached to the approval, which have to be met by the Association.
4.13Advice on Completing the Documentation for project approval - Form SN1 / TA1 (see Annex D) contains the key data that enables the Project Approval assessment to take place. In completing the form, the Association needs to take into account the following:
a.Meeting housing need - the scheme location, project type and description of proposals should relate to the terms of the NIHE’s formal support for housing need for the scheme in question;
b.The scheme costs - qualifying scheme costs should normally be calculated on the basis of qualifying acquisition costs, plus qualifying works costs plus standard on-costs. The Association’s estimates of the capital costs of the scheme, which should include the full value of any public subsidy, should be broken down as follows:
- Purchase Price - the anticipated purchase price of the land/property only should be included;
- Works Costs - main contract works, major site development works (new build) major pre-works (rehabilitation) and home loss costs (new build only), plus VAT. Other capital costs associated with the development, e.g., furniture, minor site development work; immediate repairs should not be included (see Appendix: 7 to Part 1). Cost estimates must be based on forecast final outturn costs;
- Other Costs - the remaining scheme costs (the eligible components are listed in Appendix: 7 to Part 1) are represented not as individual items, but in aggregate as a standard on-cost percentage applied to the sum of the acquisition and works costs. Details of the standard on-cost percentages available are given in Appendix: 7 to Part 1 of this Guide and space are provided on the application form to calculate the particular on-cost appropriate to the scheme;
- Package Deals, Off-the-Shelf, Existing Satisfactory and Works Only Schemes - package deals including land/property should separately identify the purchase price and works cost elements of the package, omitting any on-cost element.
The total cost of Off-the-Shelf Schemes should be entered against purchase price. The works cost entry should be omitted and the appropriate on-cost percentage applied to the purchase price. Any minor works following acquisition should normally be met from on-costs. In exceptional cases, if works are on such a scale as to require a works contract, the scheme could be defined as acquisition and works.
The cost of Existing Satisfactory Purchase (ESP) Schemes should be entered against purchase price. The cost of repair/checks/upgrading should be entered against the works cost entry and the appropriate on-cost percentage applied to the purchase price and cost of any necessary repair/checks/upgrading. [Note: The estimated repair/checks/upgrading cost of each dwelling should normally not exceed £10k (excluding VAT) per dwelling. Appendix: 2 to Part 4 refers.]
- Non-Qualifying Costs - the Association should identify the total cost of any non-qualifying items which form part of the total scheme costs and deduct this from the total scheme costs figure to produce the total costs upon which grant is sought. The means of funding the non-qualifying items will be identified in the Sources of Capital Funding calculation.
Should the NIHE (DPG) as part of its scheme assessment, determine that further costs have to be disqualified, the Association will be asked to confirm the means of funding the additional non-qualifying element;
c. Cost criteria - the Association should make the detailed calculation of the Total Cost Indicator for the scheme using the supplement (Form SFN1, see Annex F) to the main application form, before completing the Total Cost Indicator Summary on Form SN1 / TA1;
d. Grant adjustment - the TCI and Grant Rates system enable scheme-specific factors to modify the standard grant rate and produce an adjusted grant rate, which will be used in the Grant Claim section of Form SN1. In the case of re-improvement schemes, the applicable grant percentage of the redemption cost of any outstanding mortgage - as at the anticipated date of Practical Completion - forms part of the grant claim section of Form SN1 / TA1;
e. Financial viability - Form SN1 / TA1 includes a certification that the Association has undertaken a long term assessment of the scheme financial aspects and is satisfied of the ability of rental income to cover operational costs including repayment of loan principal and interest;
f. Application for consent to dispose - under Article 13 of the Housing (Northern Ireland) Order 1992 consent to dispose is required where the Association wishes to obtain a mortgage for the development and/or for the completed scheme. The Association should indicate clearly its compliance at the relevant certification on Form SN1 / TA1;
g. Combination schemes - both the new build and rehabilitation boxes should be ticked and the word “and” inserted between the boxes on this form and other relevant forms. It should be noted that combination schemes are schemes with distinct new build and rehabilitation elements, which could “stand alone” for scheme and programme purposes and must not be confused with normal rehabilitation schemes with a new build element.
4.14Site Layout Plan - the purpose of this plan, to a scale of 1:200, is to provide information on the location of the site/property and the arrangement of the proposed dwelling(s). The plan should include:
- Boundaries and points of access;
- Roads and footpaths on or adjacent to the site, proposed levels;
- Layout of buildings, gardens and fences, roads and parking areas, landscaped areas, retaining walls etc.
4.15Schemes over TCI - the information supplied in support of schemes where costs exceed the norm must contain sufficient details to permit an effective assessment of reasonableness:
- The Association’s explanation for costs exceeding TCI, the outline specification and the structural/ground condition report (if appropriate) should together cover all abnormal cost factors and ensure that the content of the proposals can be understood. The Association should also include a brief cost analysis of the works elements.
[Note: In order to expedite matters the Association should submit readily available documentation in support of this paragraph. Supporting documentation will vary depending on scheme type but should, as a minimum, include a Consultant’s or Technical Agent’s report confirming that the scheme represents value for money. Where submitted documentation does not contain sufficient detail to permit assessment the NIHE (DPG) will contact the Association].
- As the Association is expected to propose economic designs, which are suited to the intended occupants of the scheme, the NIHE (DPG) will not be prepared, in the case of schemes over TCI, to fund provision in excess of the norm.
4.16Special Projects promotion Allowance (SPPA) – is a grant payable to Associations receiving capital funding under the Supported Housing Procedures (See – Annex M for further details).
5.01This facility exists - to allow changes to be made to scheme proposals after approval. The NIHE (DPG) envisages that this facility would be invoked rarely and normally only between Acquisition and Start on Site stages. The NIHE (DPG) will monitor the incidence of use of this mechanism by the Association across the development programme. It is not intended that Associations should use the process routinely to defer the accurate formulation of development proposals. Three types of revised approvals are possible:
- Where a fundamental change to development proposals is made - if, in the period between Project Approval and going out to tender, the Association wishes to make a fundamental change to its development proposals which affects TCI (e.g. change of mix, batching/re-batching of properties within a project), the NIHE (DPG) will consider re-determining the amount of grant available. In the case of Rehabilitation schemes where re-batching (i.e., bringing together of elements of different Project Approvals) is involved, the NIHE (DPG) is only prepared to consider a revised approval prior to Start on Site stage, where all the properties in the new groups have a common standard grant rate, TCI rate and SPA, if applicable. Such revisions will, in effect, require the complete recalculation of the grant entitlement of both the newly created scheme(s) and any residual scheme.
[Note: The Association should submit revised Forms SN1/TA1 and SFN1 for the original project(s), excluding any units to be re-batched, and also submit a new Project Approval application for the re-batched units. The Association should note, in preparing its application that the TCI, Grant percentages, and Standard On-costs applying to the original approval(s) will hold];
- Where a tenanted property remains unimproved - where a tenanted property has not been improved within 18 months of completion of the acquisition, the NIHE (DPG) will ask the Association to state the proposed Start of Site date. Where the Association is unable to confirm a definite date, the NIHE (DPG) will reassess the scheme against Off-the-Shelf criteria as if it had been originally presented as a tenanted “Off-the-Shelf” purchase, using the grant, TCI and on-cost rates applicable at the time of the original Project approval. When the property is eventually available for improvement the Association will make a new project approval application for a Works Only scheme following the instructions at 4.13 to 4.15. The outstanding loan will be brought into the grant calculation as part of the project approval;
- Where after project approval is given, the scheme is subject to substantial delays –each case will be considered on its merits, and if the reason for the delay cannot be attributed to the Association the NIHE (DPG) may allow the TCI and Grant Rates to be recalculated in accordance with the procedures used for the Advanced Acquisition of Land.
5.02If the changed proposals are agreed - a revised Project Approval will be issued. Any necessary adjustments (up or down) to the grant payments will normally be made at Start-on-Site Stage. The NIHE (DPG) will determine the necessary adjustments to the grant payments already made, and will advise the Association accordingly. Any underpayment should be actioned by submission of Form GA1 by the Association. Any overpayment will either be reclaimed from the Association or adjusted at the next stage payment, depending on the amount of the overpayment.
5.03Changes made after Start-on-Site Stage – changes should normally not be made after the Start-on-Site stage. However, in exceptional circumstances an additional unit or units may be added or omitted, or a larger/smaller unit substituted in the Building Contract for housing management reasons. Associations should inform the NIHE (DPG) at the earliest possible opportunity and provide plans etc. The NIHE (DPG) will normally give an in-principle approval, and grant – which will be based on the TCI and Grant rates applicable to the original approval – can be reconciled at Practical Completion stage. Where additional units are added to the site or adjacent to the site, as a new phase, this phase will normally attract the TCI and Grant Rates applicable at the time of the application.
6.01Subject to its financial allocation - the Association will be eligible to claim Tranches of the total grant approved by the NIHE (DPG), in stages at:
- Exchange of the Purchase Contract (See Section 7.00);
- Start on Site (See Section 8.00);
- Practical Completion (See Section 9.00).
Further details on Tranches and Tranche Percentages applicable to different types of scheme are given in Appendix: 7 to Part 1 of this Guide. To qualify for payment of the first instalment of grant the Association should follow the guidelines in Section 7.00 (Acquisition of land/property). In order to conform to the Association’s financial allocation the NIHE (DPG) may need to split grant Tranches, i.e. make a partial Tranche payment this year and the residue in the next financial year. This is likely to be the exception rather than the norm, and will only be done in consultation with the Association.
[Note: Grant is only available in respect of qualifying costs (see Annex Q for details of qualifying and non-qualifying costs.]
6.02Grant for Package Deals - to be eligible to claim the combined acquisition and works elements of grant in respect of Package Deals including land, the Association will need to satisfy the criteria for receipt of grant described both in Section 7.00 (Acquisition of Land/Property) and in Section 8.00 (Start on Site) below. If this is not possible, separate grant claims in respect of acquisition and then works should be made. The Association should then proceed to Final Cost Assessment stage.
6.03Grant for Off-the-Shelf Schemes – provision has been made to allow a first Tranche of 20% to be claimed where work has started and the vendor (contractor/developer) requires an initial deposit to allow the purchase contract to be signed and the work completed. The remaining Tranche (normally 80%) is paid when the dwelling is completed and the Association takes possession etc. To be eligible to claim 100% of the available Grant for such schemes, the Association will need to satisfy the additional criteria for receipt of grant described in Section 7.00 (Acquisition of Land/Property). The Acquisition stage grant application in Off-the-Shelf schemes represents the final claim and no further advances of grant will be made. The only exception to this is in large schemes where all or some of the dwellings are completed and ready for occupation, but where ‘communal features’ still have to be completed. In such exceptional cases, the Association may ask the NIHE (DPG) for claim purposes only to pay part of the Tranche in order to allow the completed dwellings to be purchased and occupied, but to withhold part of the Tranche – normally 20% - to be the subject of a final claim.
6.04Grant for Works Only Projects - since no acquisition is involved in Works Only Projects the Association will be able to move ahead quickly to develop the site/property. The first Tranche of grant will be made available at Start on Site stage. The Association will be required to make additional certifications at Start on Site stage, confirming that the land/property in its ownership offers good title and that no legal obstacle impedes development.
7.00 Acquisition of Land/Property Stage
7.01Acquisition of Land/Property (Grant Application Procedures)
(a) Action by the Association
The Association must be able to confirm that:
a. Any conditions of Project Approval applying to the acquisition have been met;
b. The purchase price does not exceed the value of the property as assessed by the District Valuer or an independent qualified valuer, whose valuation must be not more than 12 months old at the date of execution of the contract;
c. The property to be acquired offers good title.
d. Property already in the Association’s ownership should comply with the above;
e. Any necessary consents have been obtained prior to exchange of the Contract (e.g., Article 13 consent for mixed funded schemes);
f. It has exchanged the purchase contract;
g. The Association will inform the NIHE (DPG) immediately of any change in the notified date for completion of the purchase;
h. The Association will complete the purchase conveyance within 30 working days of receipt of Grant, otherwise the grant and/or interest will be recovered by the NIHE (DPG);
i. Any material divergence from the (revised) development timetable included on this claim will be reported forthwith to the NIHE (DPG).
THE ABOVE CERTIFICATIONS ARE MADE BY THE ASSOCIATION IN APPLYING FOR PROJECT APPROVAL AND ARE SUBJECT TO INSPECTION BY THE DSD. WHERE THE ASSOCIATION IS UNABLE TO MAKE ANY OF THE CERTIFICATIONS REFERRED TO ABOVE – UNLESS IT IS NOT APPLICABLE TO THE SCHEME - IT SHOULD AMEND THE CERTIFICATION AND PROVIDE DETAILS ON THE FORM OR IN A COVERING LETTER.
(b) Action by the Association – Application for the Acquisition Tranche
On exchange of the purchase contract, the application should be made to NIHE (DPG) for the Acquisition Tranche and include:
- Form GA1 (see Annex G);
- Copy of a letter from the Association’s Solicitor confirming agreement to purchase (The Association should ensure that its Solicitor is aware of the timetable for receipt and payment of grant claims at Annex O);
- 2 copies of an OS map (Scale 1:1250 or 1:2500 – outlining the land/property in red);
[NB: An OS map is only required if the Association is submitting a Solicitor’s letter confirming that the land is in the Associations ownership (this letter should include details of the date of completion and the consideration.)]
(c) Action by the NIHE (DPG) – Acquisition Tranche
The NIHE (DPG) will check that the application is complete, correct and signed by an authorised signatory. If satisfied the NIHE (DPG) will advance grant, in accordance with the timetable.
(d) Action by the Association – Within 30 working days of Grant being Paid
The Association must provide the NIHE (DPG) with:
- A copy of a letter from the Association’s Solicitor confirming that the land is now in the Association’s ownership, the date of completion and the consideration.
(e) Action by the Association – Application to register a Statutory Charge
On completion of the purchase contract, the application should be made to DSD and include:
- Copy of a letter from the Association’s Solicitor confirming the date of completion and the consideration;
- 2 copies of an OS map (Scale 1:1250 or 1:2500 – outlining the land/property in red to allow the DSD to apply for a Statutory Charge in accordance with Articles 13 of the Housing (Northern Ireland) Order 1992 and 161 of the Housing (Northern Ireland) Order 1981 and paragraph 37 of Schedule 11 to the Land Registration Act (Northern Ireland) 1970. The inclusion of the Ordnance Survey grid reference is also useful to the DSD. The Maps should also either have a Housing Association Licence number or Ordnance Survey acknowledgement on them).
(f) Action by the DSD – Statutory Charge
Statutory Charge - following confirmation of completion of the purchase contract, the DSD will apply for the Statutory Charge referred to above.
(g) Action by the Association -Formal Consent to Mortgage for Development Capital (Mixed Funding)
Where the Association is to mortgage the property to raise development capital, the mortgage agreement must be submitted to the DSD for formal endorsement. The agreement should make provision for the endorsement below:
“The Department for Social Development for Northern Ireland hereby consents under Article 13 of the Housing (Northern Ireland) Order 1992 to the within mortgage.
_______________________________
A Senior Officer of the Department for Social Development
Dated this day of 2xxx.”
(h) Action by the DSD – Formal Consent to Mortgage for Development Capital (Mixed Funding)
After checking that the mortgage agreement refers to the original approval in principle, the DSD will arrange to have it signed and returned to the Association.
8.00 Start On Site Stage (Grant Application and Assessment)
8.01In obtaining tenders for the works - the Association should select the procurement method it considers most cost effective, subject to the criteria and advice contained in Part 4 of this Guide – Procurement Requirements.
8.02On receipt of tenders - the Association should reassess the scheme costs. If scheme costs at tender stage exceed the Project Approval estimate the Association will need to consider reductions and/or the additional costs will be met. It is important to bear in mind that the eligibility for grant for cost overruns is not determined until Final Cost Assessment, so the Association needs to take a view of how it will meet:
- Either - the total amount of the cost increase (in the event that none of the overrun is eligible for grant);
- Or - the Association’s share of the cost increase as determined by the grant percentage set at Project Approval.
8.03Start-on-Site Stage (Grant Application) - As soon as the main building contract has been awarded, the Association should make application for the Start-on-Site Tranche as detailed below.
8.04Start-on-Site Stage (Grant Application & Assessment Procedures)
(a) Action by the Association – Grant Applicable Procedures.
The Association must be able to confirm that:
a. The scheme complies with the DSD’s Design and Procurement Requirements (see Parts 3 and 4 of this Guide);
b. No change has occurred in the units to be produced which affects the calculation of TCI;
c. Detailed Planning Permission for the scheme has been obtained (where appropriate);
d. Building Regulations approval for the scheme will be obtained prior to Practical Completion;
e. It will meet the cost of any shortfall on capital or revenue funding including the cost of any non-qualifying items;
f. Any necessary topping up funding has been obtained and is guaranteed for a minimum of 12 months, with in- principle commitment for on-going support;
g. It has completed the Joint Management Agreement, where the project is to be managed in partnership with another body;
h. No non-qualifying items are included in the costs for grant funding;
i. It has entered into the Building Contract and started on site. Start-on-Site will be taken to be the date for possession of the site as stated in the building contract;
j. It will include the DSD Branding where required (See - Annex X);
k. No member, employee, agent or consultant of the Association has any interest in the proposed vendor, contractor, or the land of property to be acquired. The declaration extends to any firm, partnership or organisation in which they or their families are involved as partner, director, or shareholder. (If such a declaration cannot be made without reservation, a statement should be appended giving a full disclosure of the interests of the people concerned);
l. Any material divergence from the (revised) development timetable included on this claim will be reported forthwith to the NIHE (DPG).
Associations developing projects on land/property already in their ownership must be further able to confirm that:
a. The property to be developed offers good title;
b. No restrictive covenants exist which impede development of the site/property as proposed;
c. Any necessary consents have been obtained prior to Start on Site;
d. Its solicitor has confirmed, in writing, that the land/property is in the Association’s ownership.
THE ABOVE CERTIFICATIONS ARE MADE BY THE ASSOCIATION IN APPLYING FOR GRANT AND ARE SUBJECT TO INSPECTION BY THE DSD. WHERE THE ASSOCIATION IS UNABLE TO MAKE ANY OF THE CERTIFICATIONS REFERRED TO ABOVE – UNLESS IT IS NOT APPLICABLE TO THE SCHEME - IT SHOULD AMEND THE CERTIFICATION AND PROVIDE DETAILS ON THE FORM OR IN A COVERING LETTER.
(b) Documentation Required for Claiming Grant
Application for Start-on-Site (SOS) Tranche to include:
- Form GA1 (see Annex G);
- Copy of extract from Building Contract – e.g., signed Articles of Agreement or equivalent – indicating that the Association has entered into a Building Contract;
- Copy of extract from Building Contract – e.g., Appendix 1 from JCT contract or equivalent – showing the date that possession of the site passed to the contractor;
- Copy of Planning Approval (Green Form). [Note: with the NIHE (DPG) agreement the Green Form can be submitted within 30 working days of Grant being paid].
The timetable for receipt and payment of grant claims is at Annex O.
(c) Action by the NIHE (DPG)
The NIHE (DPG) will check that the application is complete, correct and signed by an authorised signatory. If satisfied the NIHE (DPG) will advance grant in accordance with the Grant timetable (see Annex O).
(d) Action by the Association - Within 30 working days of Grant being paid
The Association must provide the NIHE (DPG) with:
- A copy of a letter from the Association’s Consultant either confirming that work is progressing on site or explaining the lack of progress;
- The letter should be accompanied by the following which will be recorded by NIHE (DPG) to allow the DSD to monitor building costs:
Form (PIF) (see Annex L) for self-contained New Build Dwellings (General Needs and Special Needs); or
A BCIS Detailed Form of Cost Analysis obtainable from the Building Cost Information Service of the RICS, for shared accommodation schemes; and
A Tender Price Index Form (New Build Social Housing (TPI) – (see Annex K) in respect of schemes with works costs of £250,000 and over, with a Bill of Quantities, Builders Quantities or detailed schedule of rates.
9.00 Partial Completion Stage
9.01When a phase of a building contract - has reached Practical Completion, or, in the case of Off-the-Shelf schemes, when part or parts of the works have been taken into Association possession, the Association may submit a grant claim to the NIHE (DPG). Grant should only be claimed on those dwellings/ units that have reached practical completion stage and for which the Association has taken possession.
[Note:
(1) In contractual terms this is known as a ‘Sectional Completion of the Works’ or ‘Partial Possession by Employer’.
(2) This facility is only available with the prior agreement of the NIHE (DPG). It can be useful in medium to large schemes where the dwellings will be completed and handed over to the Association in a number of phases.]
9.02Grant should be claimed - on the basis of a ‘sub-phase’ of the approved scheme, as follows:
Grant Rate Type (Line 2 – SFN1 Form (see Annex F))
- Number of Units Completed x Adjusted TCI per Unit/ Person (Line 11 – SFN1 Form) x Unit Grant Rate (Line 12 – SFN1 Form) x Scheme Cost Index (Taken from SN1/ TA1 Form – Annex D) x Practical Completion Tranche Percentage
9.01Partial Completion Stage (Cost Application & Assessment Procedures)
(a) Action by the Association – Grant Application Procedures
.The Association should apply for grant using Form GA1 (see Annex G), which should be based upon the Association’s calculations of the amount of grant due (see Para 9.02 for details of Partial Completion Tranche Claim calculations). The Association must be able to confirm that:
a. The dwellings produced comply with the DSD’s Design and Procurement Requirements (see Parts 3 & 4 of this Guide);
b. No change has occurred in the units produced which affects the calculation of TCI;
c. No non-qualifying items will be included in the costs for grant funding;
d. The final forecast will not contain any costs which may be recoverable by the Association as the result of a claim by or against a third party;
e. Building Regulations Approval and detailed Planning Permission has been obtained (where appropriate).
f. Any necessary topping-up funding has been obtained and is guaranteed for a minimum of 12 months, with in principle commitment for ongoing support;
g. It has completed the Joint Management Agreement, where the project is to be managed in partnership with another body;
h. For Off-the-Shelf schemes it will within 30 working days of receipt of grant, forward to the NIHE (DPG) a copy of a letter from a solicitor confirming that completion of the purchase has taken place, the date of completion and the consideration.
WHERE THE ASSOCIATION IS UNABLE TO MAKE ANY OF THE CERTIFICATIONS REFERRED TO ABOVE, THE CERTIFICATION SHOULD BE AMENDED AND DETAILS PROVIDED. WHERE CERTIFICATION (d) IS AMENDED THE NIHE (DPG) WILL REQUIRE REIMBURSEMENT OF THAT PORTION OF ANY AMOUNT RECOVERED, WHICH IS REPRESENTED BY THE GRANT RATE FOR THE SCHEME.
(b) Documentation required supporting the Association’s application.
Documents required:
All Schemes:
- Statement of Partial Possession by the Employer (or equivalent) [Note: In the case of Design & Build schemes, this will be a copy of a statement from the contractor identifying the part or parts of the works taken into possession and giving the dates when the Employer took possession];
- In the case of Off-the-Shelf schemes, a copy of a Solicitor’s letter confirming that the purchase monies for acquisition are required;
- Details of the Association’s calculations of grant claimed (see Para 9.02 for details of Partial Completion Tranche claim calculations);
- Form GA1 (See - Annex G) Application for Housing Association Grant, amended to reflect the interim nature of the tranche claim;
(c) Action by the NIHE (DPG)
The NIHE (DPG) will check that:
a. The application is complete, correct and signed by an authorised signatory;
b. In Off-the-Shelf or Existing Satisfactory Purchases schemes, the declared actual cost of purchase equates to the evidence provided (i.e., the statement from the Association’s Solicitor);
If satisfied the NIHE (DPG) will, advance any grant due based upon the Association’s Partial Completion Tranche claim calculation.
(d) Action by the Association – Within 30 working days of Grant being paid in Off-the-Shelf schemes
The Association must provide the NIHE (DPG) with:
- •A copy of a letter from a solicitor confirming that completion of the purchase has taken place, the date of completion and the consideration.
10.00 Practical Completion Stage
10.01When the building contract, or phase of the building contract, has reached Practical Completion - or, in the case of Off-the-Shelf schemes and , when purchase completion takes place, the Association should determine its estimated final costs. Where such costs are at or below the figure approved at Project Approval stage, grant will be based upon the Association’s forecast final cost figure, subject to an assessment by the NIHE (DPG) of the reasonableness of the forecast. The Association should follow the instructions set out at Para 10.03 below.
10.02Where such costs exceed the figure agreed at Project Approval stage - grant will be based upon the latter (subject to assessment by the NIHE (DPG) of the reasonableness of the forecast), unless the Association wishes to apply for approval of additional costs in which case the Association should follow the instructions set out at Para 10.03 below but including the additional documentation required for schemes with outturn costs above approved costs.
10.03Practical Completion Stage (Final Cost Application & Assessment Procedures)
(a) Action by the Association – Grant Application Procedures.
The Association should apply for grant using Forms GA1 and GP2 (see Annexes G & I), which should be based upon the Association’s forecast of the final costs; (For tariff funded schemes, Form GP2 is not required). The timetable for receipt and payment of grant claims is at Annex O. The Association must be able to confirm that:
a. The dwellings produced comply with the DSD’s Design and Procurement Requirements (see Parts 3 & 4 of this Guide);
b. No change has occurred in the units produced which affects the calculation of TCI;
c. No non-qualifying items are included in the costs for grant funding;
d. The final forecast does not contain any costs which may be recoverable by the Association as the result of a claim by or against a third party;
e. Building Regulations Approval and detailed Planning Permission has been obtained (where appropriate).
f. Any necessary topping-up funding has been obtained and is guaranteed for a minimum of 12 months, with in principle commitment for ongoing support;
g. It has completed the Joint Management Agreement, where the project is to be managed in partnership with another body;
For Off-the-Shelf schemes it will within 30 working days of receipt of grant, forward to the NIHE (DPG) a copy of a letter from a solicitor confirming that completion of the purchase has taken place, the date of completion and the consideration.
WHERE THE ASSOCIATION IS UNABLE TO MAKE ANY OF THE CERTIFICATIONS REFERRED TO ABOVE, THE CERTIFICATION SHOULD BE AMENDED AND DETAILS PROVIDED. WHERE CERTIFICATION (d) IS AMENDED THE NIHE (DPG) WILL REQUIRE REIMBURSEMENT OF THAT PORTION OF ANY AMOUNT RECOVERED, WHICH IS REPRESENTED BY THE GRANT RATE FOR THE SCHEME.
(b) Documentation required to support the Association’s application.
Documents required:
All Schemes:
- Form GP2 (See – Annex I) incorporating - final cost statement in respect of the purchase price, works and standard on-costs, original estimates, actual costs to date, forecast expenditure etc (Non-tariff scheme only);
- Certificate of Practical Completion (or equivalent);
- In the case of Off-the-Shelf schemes, a copy of a Solicitor’s letter confirming that the purchase monies for acquisition are required;
- The Association’s consultant/agents forecast of the contractor’s final account (Non-tariff scheme only);
- Latest Interim Certificate showing actual costs to date. Where Major Site Development Works or VAT are included in the Works Cost, the Final Certificate/Account in respect of the Pre Works and VAT Certificates should be provided. (NB: theses figures should together equate to the actual Works Cost element included in the Final Costs statement mentioned at (a) above) (Non-tariff scheme only);
- Form GPS1 (See - Annex H) Statement of actual On-Costs for cost monitoring purposes;
- Form GA1 (See - Annex G) Application for Housing Association Grant;
- Secured By Design Certificate (if applicable);
- Eco Homes Certificate (if applicable)
Non-tariff funded schemes with outturn costs above approved costs for which application for additional grant is being made:
- The Association’s case for consideration of any cost overrun being applied for (This should include a detailed and documented analysis of movement in costs between Project Approval and Completion);
(c) Action by the NIHE (DPG)
The NIHE (DPG) will check that:
a. The application is complete, correct and signed by an authorised signatory;
b. In Off-the-Shelf schemes, the declared actual cost of purchase equates to the evidence provided (i.e., the statement from the Association’s Solicitor);
c. The relationship between actual costs to date and forecast final costs;
d. The extent of any cost overrun in respect of which grant is sought by the Association, is contained within the permitted maximum defined at Project Approval stage;
e. The reasons for any cost overruns in respect of which grant is sought are acceptable.
If satisfied the NIHE (DPG) will, advance any grant due based upon the agreed forecast final cost figures or, in the case of a cost overrun application, make an interim payment of grant based on the total scheme costs approved for grant at Project Approval stage. The NIHE (DPG) will then re-determine the amount of grant it is prepared to approve and confirm to the Association the final costs figure approved for grant.
(d) Action by the Association – Within 30 working days of Grant being paid in Off-the-Shelf or Existing Satisfactory Purchases schemes
The Association must provide the NIHE (DPG) with:
- A copy of a letter from a solicitor confirming that completion of the purchase has taken place, the date of completion and the consideration.
10.04Recoverable Costs - where, following a final grant claim, the Association is able to recover costs as the result of a claim by or against a third party, that proportion of the costs represented by the grant rate for the scheme should be forwarded to the NIHE (DPG).
