Friday, January 15, 2016

News: Rotherham development levy on its way


Final proposals are set to be submitted for Government approval soon that would result in developers wanting to build houses and out of town retail projects in the Rotherham borough paying a levy under a new scheme designed to raise an estimated £12m to support local infrastructure.

The Planning Act 2008 introduced the concept of the Community Infrastructure Levy (CIL) as a new means for authorities to seek developer contributions to help fund infrastructure and Rotherham Council has been consulting on how it could operate in the borough. Councils aren't obliged to introduce a levy but the CIL can, in the most part, replace Section 106 financial contributions and provide a more transparent way of raising money to help pay for the infrastructure required to deliver the Local Plan.

Some housebuilders and landowners have objected to the proposals.

With the borough's local plan identifying that 235 hectares of land will be needed over the period to meet the broad requirements of 12 - 15,000 additional jobs, office and industrial developments are set to be exempt from the new levy.

Section 106 legal agreements are signed between developers and the council when planning permission is granted on a site by site basis. They often include funding that can be used for school places, improving the local road network or public transport provision. Section 106 agreements would still be used, where appropriate, to secure affordable housing and on-site mitigation.

A Draft Charging Schedule has been devised by the council that would see housing developers pay different amounts in different areas of the borough, ranging from £55 / sq m in areas like Whiston and Wickersley, to £30 / sq m in the Dearne, and £15 / sq m at Bassingthorpe Farm.

Developers proposing a new supermarket would pay £60 / sq m and the development of Retail Warehouse / Retail Parks would incur £30 / sq m. Business park office, industrial, and town centre comparison retail developments are not considered viable under current market conditions and would not attract any levy.

During consultation, Fitzwilliam (Wentworth) Estates, the owners of large areas of the proposed Bassingthorpe Farm development raised objections and asked for either a lower charge or reduced Section 106 obligations, adding that CIL "should not put at risk the development viability of its land interests."

Housebuilder Taylor Wimpey questioned the assumptions and balance between the use of CIL and Section 106 income. It added objections to the lower levy for Bassingthorpe Farm, stating that the "cross-subsidy" could contravene state-aid rules.

Studies into the borough's infrastructure concluded that total infrastructure requirements to support the Local Plan are estimated to cost around £99m and with the scarcity of Government funding, only £48.8m funding is anticipated from mainstream or known sources. The estimated income based on the proposed CIL rates is at least £12m.

An initial list of top priority infrastructure schemes that the CIL may be used to fund has been produced. This includes continuing the Rotherham Renaissance Flood Defence Scheme; highway junction improvements on the edge of the town centre, Templeborough, the M18 at Hellaby, and the A631 at Canklow; and improvements to public transport infrastructure on key bus routes. It may also be used for school places, doctor's surgeries, and expansion of police stations and public libraries.

Following the consultation, changes have been made to the list to include more infrastructure projects around Bassingthorpe Farm, given that infrastructure could cost an estimated £50m and concern was raised that levies and specific Section 106 proposals would make the development economically unviable.

With approval from commissioners, and shortly from the Full Council, the Draft Charging Schedule is to be submitted to the Planning Inspectorate for independent examination. If a favourable report from the inspector is received, the Council can then proceed to adopt and implement the new levy. Officers believe that it could come in to force in October 2016.

Rotherham Council website

Images: RMBC


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