Growing Places Fund & Future Investment Model Arzu Ulusoy-Shipstone Capital Investment & Business Development Manager Oxfordshire County Council 4 th April 2012

Introduction Infrastructure Financing – The Journey from 2000 to 2012 The Rolling Fund Concept Opportunities for Oxfordshire Recommendations 2

Infrastructure Financing: 2000 to  Departmental Capital Grants  PFI  Borrowing from PWLB  Section 106  Grants from RDAs & Other Public Organisations  New Homes Bonus  Regional Growth Fund  CIL & Section 106  TIF  LABVs  Growing Places Fund  LEPs & EZs  Borrowing from a more diverse range of sources Increased Level of Capital Reduced Level of Capital Source: NLGN- Capital Futures

Infrastructure Financing: 2012 & Beyond 4 SourceOpportunity BondPooling Issues Income SecuritisationAsset Specific PWLBPossible discounts REITSTax efficient models Traditional DebtShorter term borrowing European Investment BankCheaper cost TIFBased on future tax income/ uplift in business rates Business Improvement DistrictsTax based solutions subject to referendum National Infrastructure Bank (eg Green Investment Bank) Incentives for pension funds to invest in infrastructure Diverse Funding/ Borrowing Options

Infrastructure Financing- Challenges Reduced access to public funds & problems facing the private finance market; UK’s competitive position in the global economy; The need to sustain & increase the level of investment in infrastructure that supports growth; Economic growth and its importance in future funding available at the local level; Substantial up-front investment required to realise the benefits from the LEP/ the EZ 5

The Rolling Fund Concept In its Simplest Form Providing of upfront funding to unlock development Facilitating of timely provision of infrastructure that supports the delivery of growth; Bringing forward other developments through use of recycled values; Enabling cross-boundary funding flows Added Functionalities Co-ordinating funding of infrastructure that serves multiple sites; De-risking infrastructure which may or may not be linked to any development; Supporting long-term investment ventures (such as land assembly) for maximising return or delivering specific projects; Acting as investment vehicle for other infrastructure financing tools/ delivery routes such as PPP or TIF; 6

The Rolling Fund Concept 7 S106/ CIL BR Uplifts (EZs) NHB/ RGF Other Funding GPF Rolling Investment Fund Infrastructure Pays Upfront (in the form of equity or loan) for InfrastructureProjects Development To Release Development Returned or Recycled Value (Potential Revenue Streams/ Captured Land Value)

The Rolling Fund Concept 8 S106/ CIL BR Uplifts (EZs) NHB/ RGF Other Funding GPF Rolling Investment Fund Public Sector (Asset or Cash Contribution) Private Sector Investor Infrastructure Pays Upfront (in the form of equity or loan) for InfrastructureProjects Development To Release Development Returned or Recycled Value/ RoR from Investment (Potential Revenue Streams/ Captured Land Value)

Opportunities for Oxfordshire Creating a co-investment opportunity to sustain and increase growth in Oxfordshire; Ensuring the success of the EZ and the delivery of its wider benefits; Pooling resources to create scale that enables consideration of a wider investment portfolio and effective dialog with investors; Demonstrating innovation to be in better place for attracting future government funding; Credible and joint approach to investment for delivering growth 9

Recommendations Agree to invest the GPF in a “larger investment fund” in collaboration with partners; Review & agree the key prioritisation principles (criteria) for the allocation of the fund; Agree to develop an “objective assessment methodology” & to appoint an independent organisation to undertake the formal assessment; Approach partners to support the creation of the larger investment fund; Note that the timetable for allocation of the Fund is June