We got an update from OSCR that while they have our application for Portobello Central Ltd to become a SCIO, work on it has not yet started on it. They are currently on applications from mid-March and ours was acknowledged on 19 April. They have a backlog of over 250 applications. We’re working to a timescale that suggests a decision on our charitable status might emerge in September. OSCR thought that August might be possible.
Why is this important?
Well, we cannot sign any sort of lease with the Council as a company or we would become liable for rates. Our current structure is a company limited by guarantee, done because a company can be set up in an afternoon but setting up a charity takes time, thought and due diligence and we needed an organisational structure to bid. It has, however, always been our intention to operate as a charity and we adopted the SCIO model to achieve this.
Why don’t we want to pay rates?
You might remember the council figures on the Town Hall showed running costs per annum of £100k and income of £50k of which £50k was rates. As a charity we’d not be liable for rates and our business case is predicated on successfully becoming a charity and not paying that £50k. Of course, there is a bigger question of how councils will be funded if rates are not paid by organisations like ours and adequate funding of councils is an important concern for all of us but let’s leave that debate for another day and suffice to say we’re operating in the environment or economic model before us.
Why else is charitable status important?
Charitable status will give us articles or objectives to work to and will help to define our governance model. This can be done in companies too but none were set up in our company application as the intention was always to move to be a charity structure and there was no intention for the company to remain our structure.
Charitable status means we will not be liable for corporation tax either but it will put rigorous annual account reporting requirements on us, known as the Charities Statement of Recommended Practice or SORP .
It also guides our ethos for what we consider to be our social enterprise – profitable events in Portobello Town Hall will finance not-for-profit activities and ensure the future financial sustainability of the enterprise.
When we obtain charitable status we’ll need to change our bank account structure too which you can imagine is unlikely to be a quick process.
What else is needed before signing a lease?
We’re getting hire enquiries every week and people are keen to get in to Portobello Town Hall and start doing their things. However, please remember the building is not yet Porty Central’s – no lease signed means no access.
Before we sign the lease, we need to know if the building is safe and if it is not, what needs done to make it so and what it will cost. We can’t just decide that we think it is safe. It will need formal approval from various parties. We’re meeting with the architects next week to progress this very matter.
We need a staff member in place to oversee the building and bookings and to work with the board to take the project forward. We hope to hear about funding to start this off with a development worker on a project basis if we are successful with Awards for All application due to be announced soon but if that is not successful, those funds still need to be found.
We need various insurances in place which will be several thousand pounds to obtain. We hope to fund this with grants from the Architectural Heritage Fund and Scottish Land Fund but that all takes time and effort and they are not secured yet.
We can’t get the building until we start discussions with the Council on the terms of the lease. That has not started yet but we are sure the invite is coming.
Reaching Camp 1
We’ve set ourselves a target of running a trial event in the building at some future date, something we are calling Camp 1. This builds on the metaphor we have been using that winning the right to negotiate with the Council to bring Portobello Town Hall into community management and possibly community ownership, was reaching basecamp. I’ll write more of this model another time but to reach that stage, there are a lot of things that need to take place or be put in place. To loop back to the start, getting SCIO status is a crucial piece of the jigsaw of getting our place.
Jennifer’s Blog