The Village Community Association Committee is to recommend that a Community Interest Company (CIC) is formed as soon as possible, to take on the Asset Transfer of the Library building from Kirklees Council in order to protect the building for Shepley residents. The CIC would then become responsible for running the building, raising income to cover costs, and providing a base for a library and information service.
Once formed, a CIC could if required, take on other activities for the benefit of the community such as acting as a link to the Kirklees Core CityFibre internet network. But it is important that the future of the Library building is secured for the Village first, otherwise the Library could be closed and the building sold.
What is a Community Interest Company?
A CIC is a company limited by guarantee or shares but which is a social enterprise, benefiting the community rather than owners, managers or employees. The CIC must pass a Community Interest Test to show that its activities are being carried out for the benefit of the community. Any assets, such as the Library building, must be subject to an Asset Lock which ensures that assets are used for the benefit of the community. Assets cannot be transferred out of a CIC without the approval of the Regulator.
A CIC can attract investment, borrow and pay a dividend to investors, but the dividend is capped by regulation to no more than 20% of the paid-up value of a share. The CIC cannot pay a total dividend of more than 35% of profit available for distribution.
Normal Company rules apply - such as annual returns to Companies House, Corporation Tax etc. An Annual Community Interest Company Report has to be filed with the annual accounts to show that the CIC continues to satisfy the Community Interest Test.
The CIC will need directors, appointed by members or shareholders, to run it and take on the normal responsibilities that limited company directors have.
It is likely that a membership model would be preferable to a shareholder model, with membership open to all Shepley Residents.
The Village Association Committee is preparing a business plan for the CIC which will be needed to assure Kirklees that the ownership of the Library building can be transferred. Draft Articles, a Memorandum of Association and a Community Interest Statement will also need to be prepared.
Monday 8 December at 7:30pm at the Library
1 The Community Interest Company and Membership
2 Progress to date
3 Update on the Library Service and the building transfer to the Community Interest Company
Come along to find out what is happening and to take part in the CIC
Chris Ballam SVA Vice Chair