States of Jersey Currency Fund: Infrastructure Investment in Parish of Trinity: Financing of Bungalows for over 55's: Field 578

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A decision made 29 July 2014:

Decision Reference: MD-TR-2014-0082
Decision Summary Title:	Infrastructure Investment in the Parish of Trinity for Phase Two Building Project (Field No 578)		Date of Decision Summary:	24th July 2014
Decision Summary Author:	Treasurer of the States		Decision Summary: Public or Exempt?	Public
Type of Report: Oral or Written?	Written		Person Giving Oral Report:	N/A
Written Report Title:	Infrastructure Investment in the Parish of Trinity for Phase Two Building Project (Field No 578)		Date of Written Report:	24th July 2014
Written Report Author:	Treasurer of the States		Written Report : Public or Exempt?	Public
Subject: States of Jersey Currency Fund Infrastructure Investment in the Parish of Trinity for financing of phase two building project on a part of the remaining site of Field No 578 to construct 5 over 55’s bungalows.
Decision(s): The Minister decided to:- approve, in line with the current Investment Strategy for the Currency Fund, up to £1,000,000 Infrastructure Investment in the Parish of Trinity to provide financing for phase two of a building project on a part of the remaining site of field No 578 for the purpose of building 5 over 55’s bungalows. This is subject to the terms and conditions set out in the Infrastructure Investment agreement (Appendix A), and review and agree the content of the Infrastructure Investment Agreement and the proposed letter of support (Appendix A & B).
Reason(s) for decision: The Public Finances (Jersey) Law 2005 Article 6 (paragraph 1(a) and 3) relates to the investment of monies of the Currency Fund being carried out in accordance with the Regulations. Under the Public Finances (Transitional Provisions) (No.2) (Jersey) Regulations 2005 Regulation 4, the Minister is responsible for presenting the Investment Strategies and any review of them to the States, as soon as practical, and furthermore that monies may be invested in the extent and manner set out in the last Investment Strategy presented to the States. Therefore the proposal for the Currency Fund’s Infrastructure Investment in the parish of Trinity is made in line with the most recent Investment Strategy presented to the States on 11th November 2013 (R.139/2013). The development to be carried out by the Parish of Trinity increases the supply of social and affordable homes, aiding a reduction in the current affordable homes shortage. This is in line with the “House our Community” priority set out in the 2012 Strategic Plan. Further, the provision of monies to the Parish for this project provides further stimulus to the economy. The rate offered to the Parish exceeds the current long term cash returns received by the Currency Fund, maximising investment returns for the fund whilst offering diversification of Investment Asset Classes. Further, this investment will produce absolute returns for the Currency Fund and will provide a good mix of investments for the fund within the agreed risk profile.
Resource Implications: This decision will see the transfer of £1,000,000 from the Currency Fund in staged payments which are estimated to be during 2015 to 2018. The investment is estimated to last for up to 3 years. A decision has yet to be taken on whether these bungalows will be sold upon completion or rented out. This will depend on whether the financing need is for up to 1 year or 3 years. The investment returns positively impact the Currency Fund by exceeding the current level of returns it receives from its long term cash investments. The previous Infrastructure investment to the Parish of Trinity has been repaid on time and in full.
Action required: Head of Decision Support to advise the Head of Shareholder Relations that this decision has been approved. Head of Shareholder Relations to arrange for the Treasurer and the Connetable of the Parish of Trinity to sign the Infrastructure Investment Agreement and that it be appropriately witnessed. (Appendix A). Further, to ensure that the promissory letter is signed by the Parish of Trinity and returned before the first stage Infrastructure Investment payment is made (Appendix B).
Signature:		Position: Senator P F C Ozouf, Minister for Treasury and Resources
Date Signed:		Date of Decision: