Yorkshire Coast DBID Ballot Legal But Flawed

Scarborough Council is to make changes to its procedures after an investigation into its role in the ballot that led to the creation of the controversial Yorkshire Coast Destination Business Improvement District (DBID) in 2018 found a number of failings.

A report by solicitor Wendy Trainor commissioned by the authority concluded that while the council had acted legally throughout it had failed to keep adequate records, including why and how the council voted in the ballot.

She also found that the while legislation around the ballot was poorly drafted concerns raised by council staff at the time had not been acted upon.

The DBID is made up of more than 1,300 businesses in the tourism industry from Staithes in the north to Spurn Point in the south with a rateable value of more than £12,000, who have to pay a mandatory levy into the DBID, calculated at 1.5% of their rateable value.

The 2018 ballot of businesses, which was run by Scarborough Council, was passed by a margin of 217 in favour with 175 against, on a turnout of just above 29%.

However, it later came to light that more than 60 votes came from the councils involved in the process, including Scarborough Council.

Mrs Trainor’s report, which was presented to the council’s Audit Committee yesteday stated that the authority’s electoral services team was tasked with overseeing the DBID ballot despite having no prior knowledge or training in how one should be run.

A request to delay the ballot by the electoral team prompted by problems in getting vital information from the DBID company and the late withdrawal of Redcar and Cleveland Council from the process had been dismissed by the council’s “management”.

Time constraints then led to ballot papers being sent out to business addresses, some of which may not have had a postbox or been closed due to the time of the year, rather than the address of the business owner.

This decision, Mrs Trainor found, was not in breach of the DBID legislation but could  be seen as “unfair and disproportionate leading to mistrust and a negative perception about the ballot process” after the council sent its own ballot papers to Scarborough Town Hall, rather than the individual business addresses.

Mrs Trainor told councillors that the issues lay with the DBID legislation which she said was “not fit for purpose” but there had been several instances where “best practice” had not been followed by the council.

She added that while all the decisions had been taken lawfully throughout she admitted that it “didn’t look good” for the council.

She said:

“I do think the thing about this is the fact that it does look disproportionate on behalf of the council but there wasn’t any malice involved.

“It was a new process with really loose legislation and it is very, very difficult because we need to be seen as whiter than white.

“Unfortunately this whole process doesn’t fit in the best light but there was no shenanigans underneath it.”

Mrs Trainor’s report also found that the council could provide no record of how a decision was made on how it would vote in the ballot.

Scarborough Council solicitor Carol Rehill told the committee while “there should be a clear record” of the decision being made the lack of one did not render the decision illegal.

The Audit Committee agreed to set up a working group to look into the effectiveness of the DBID, which has been criticised regularly by councillors since it was created.

Changes will also be made to the council’s procedures and processes to ensure a repeat of the mistakes are not made in the future.

During the meeting, Cllr Rich Maw said that the Government should take some blame for the problems.

He said:

“I think there is a danger that residents and businesses will be pointing to the findings produced in the report and conclude that perceived errors or failings are down solely to the council’s executive management team, officers and members at the time.

“But actually, the failings rise in the main from poorly drafted legislation coming from the Government.”

The Yorkshire Coast DBID aims to raise £5 million over five years via its levy on businesses to put back into projects and initiatives that will help the region to thrive.

Last year, councillors revealed that they had tried to have the company wound-up over concerns about its response to the pandemic.

Cllr Liz Colling, the authority’s deputy leader said they had  sought “expert legal advice” to see if it could force the closure of the DBID company, but had been told that they could not do so.