Glasgow to borrow £30m to fund ‘Innovation District’ in city centre
A proposal to borrow £30m to support the development of an innovation district in Glasgow was approved by the City Council today.
The council’s executive committee agreed to a Tax Incremental Finance (TIF) scheme to fund the growth of two of the city’s regions.
TIF schemes use future revenue from tax to finance borrowing to boost public sector infrastructure, the benefits of which then create gains for the city.
The Merchant City and the West End have been identified as two key innovation districts due to being areas that have the characteristics to bring sustainable economic development to Glasgow in key sectors.
The final business case for the TIF will be decided by the end of September 2017, when the executive committee make a decision for final approval.
Councillor Frank McAveety, leader of Glasgow City Council, talked of his excitement about the changes: “Glasgow’s traditional role as a home of innovation has been boosted in recent years by a number of projects, and the creation of innovation districts promises to take the city's status for achievements in sectors such as life sciences, advanced manufacturing and energy to new heights.”
HE added that the development of a TIF scheme for the Merchant City district would bring great economic and social benefits to Glasgow.
The districts will provide a foundation for the creation and expansion of firms and creation of jobs by helping a range of businesses and universities across a number of sectors “co-invent and co-produce” new discoveries for the market.
The creation of an innovation district in the West End and Waterfront will be propped up partly by funding from the £129m the Glasgow City Region City Deal, whilst a further £60m will come from various partners.
The project aims to achieve a number of ambitions to showcase Glasgow as a generator of innovation, as well as increase visibility of companies, citizens and students.
Going forward, the council will look to submit an initial proposal to the Scottish Futures Trust and seek approval for the establishment of a TIF from the Scottish government – repayment of the funding will be subject to negotiation and somewhere around the region of 25 years.