The Community Infrastructure Levy – A planning gain?
Janet Askew, Adam Sheppard
University of the West of England, Bristol
Lorraine O’Connor
Foot Anstey
1
Context
•
Successive attempts have been made over nearly one hundred years to capture
betterment in land values from development
•
The latest of these ideas is currently being implemented with a more certain
approach – the imposition of a new ‘tax’ which will contribute to the provision of
infrastructure; the ‘Community Infrastructure Levy’ (CIL).
•
The question is whether this new model demonstrating signs that it is a genuine
gain for the actors involved in planning implementation?
2
Approach
• Literature review
•
Practice and academic materials
• Identified and reviewed case studies
• Interviews
•
Public sector planners / Private practice planners/ Councillors
• Reflected on practice and theory
Who are the actors?
e 9 CIL Key Actors
LPA
Developer
Community
4
History of value capture in the UK
Britain: ‘the world’s former laboratory
of betterment capture instruments’
(Alterman, 2012)
5
Overview
Land Values
Development Values
Betterment
Planning Agreements
S.13 Housing, Planning etc. Act 1909
S.34 TCPA 1932
Levies and Taxes
S.25 TCPA 1947
Development Charge 1947
S.52 TCPA 1971
Batterment Levy 1967
Development Land Tax 1976
Planning Gain
Planning Obligations
S.106 TCPA 1990
CIL
Planning Act 2008
CIL Regs
Viability?
6
Distinguishing characteristics
CERTAINTY
Land tax
Compensation & betterment
Planning gain supplement
Community Infrastructure
Levy (CIL) (2010)
NEGOTIATION
Section 52 agreements (1971)
Unilateral agreements
Planning Obligations (1990)
7
Planning Obligations (S.106 TCPA 1990)
Defined and interpreted by courts and government guidance:
 necessary to make the development acceptable in planning terms
 directly related to the development
 fairly and reasonably related in scale and kind to the development.
(NPPF, 2012)
8
design
EducationGood
and culture
9
Public art
10
Flood defences
11
Affordable housing
12
S.106 model
Section 106
•
•
•
•
•
•
•
•
Negotiated and flexible
Related to the proposal
For affordable housing
No fixed sums
Not mandatory
Differs between local authorities
Monitoring not statutory
Inconsistent between authorities
13
The [perceived] issues of Section 106 Agreements
•
•
•
•
•
•
•
•
Inequitable – depends on developer’s funds and surplus
Ability of LPA to negotiate / unreasonable requests
Corrosive to neutrality of planning system
Secrecy – negotiations not in public domain
Compliance
Consistency – between local authorities and within
Lengthy delays: Costly
Underspent by many local authorities
14
Precursors to CIL
Milton Keynes Infrastructure
Tariff (roof tax)
Merton Rule
• £18,500 per home
• £105,300/acre (£260,000/ha) of
employment space
• 10% of energy from on-site
renewable energy sources
Community Infrastructure Levy
CIL is a fixed flat rate charge levied against all new floorspace.
The local planning authority will:
– create a charging schedule for infrastructure
– locally determine the level of payment for residential and
commercial development
– spend the income (or in kind) anywhere in its area
– create a balance between viability, and mitigation of impact
– pass money to local communities to spend
16
Potential CIL infrastructure requirements
The Planning Act 2008 provides a wide definition of the infrastructure which can be funded by
the levy, including:
•
•
•
•
•
•
•
•
•
•
transport
flood defences
schools
hospitals and other health and social care facilities
play areas
parks and green spaces
cultural and sports facilities
district heating schemes
police stations; and
community safety facilities.
The levy includes a 5% administration fee to enable the delivery of the model.
17
CIL charge setting process
CIL Formula
chargeable development (A) x levy rate (R) x inflation measure (I)
=
chargeable amount
CIL in Newark and Sherwood
• Variable schedule areas set for
housing and commercial CIL rates
• zero CIL areas
• funds roads for which money is
limited
Plymouth charging schedule
21
Section 106 and CIL: Comparison
Section 106
Community Infrastructure Levy
•
•
•
•
•
• Fixed sums according to
development and schedule
• Flexibility in spend
• Contributes to a general fund for
social, commercial, transport and
energy infrastructure
• Cannot pay for affordable housing
• Mandatory to pay
• Monitoring is statutory
• Open and transparent
• Urban/rural issues
• Only new buildings / floorspace
can be charged
•
•
•
•
•
Negotiated and flexible
Related to the proposal
For affordable housing
Sums payable negotiable
Social gains: public open
space/amenity provisions/use
Differs between local authorities
Obligations steered by planning
policy
Monitoring not statutory
Can be varied
Claw back provisions
Where are we now?
Positive change from CIL
Arising issues
•
•
•
•
•
•
•
•
•
•
•
Non-negotiable
Transparency – process
Transparency – cost known upfront
Certainty for all?
LPA model flexibility
LPA spend flexibility
Monitoring and compliance
Neighbourhood planning role
•
•
•
•
•
•
•
•
Non-negotiable: viability questions
Transparency - spend
Interaction with S.106: Additional
tax?
‘Gap funding’?
Impact upon S.106 and affordable
housing provision
Reduced planning gain for
developer
Neighbourhood planning capacity
Exceptions limiting funding stream
Constrained by List
Prioritising the spend
Regulations continually changing
Moving forward
• Dilemma:
The issues being presented concerning CIL, if not addressed, would lead to the
issues currently associated with S.106 agreements.
 Requirement for transparent and robust mechanism to allow negotiation
of site viability matters in CIL to ‘protect’ S.106 and, in particular,
affordable housing
 Greater transparency of S.106 negotiations (within reasonable parameters
of financial disclosure)
 Requirement to increase certainty for CIL spending and prioritising the
spend. Has the link between the development and the betterment been
lost?
 Consolidation
24
The Community Infrastructure Levy – A planning gain?
Janet Askew, Adam Sheppard
University of the West of England, Bristol
Lorraine O’Connor
Foot Anstey
25