Out-Law News 2 min. read

Councils must avoid CIL double charging, says new Government guidance


Local planning authorities must avoid charging developers a community infrastructure levy and a section 106 payment for the same piece of infrastructure, the Government guidance says.

The guidance (25-page / 142KB PDF), which replaces guidance from 2010, says that the Government expects local authorities to "work proactively" with developers to ensure they are clear about the infrastructure needs of the charging authority, and about which contributions a developer will be expected to pay through which route. This is so that there is "no actual or perceived 'double-dipping', with developers paying twice for the same item of infrastructure".

The guidance says that when a local authority introduces CIL, it should scale back its section 106 requirements to matters which are "directly related to a specific site". Items included in the local authority's 'regulation 123 list', which sets out projects the authority intends to fund through CIL, should not be funded by section 106 contributions.

Under the guidance, charging authorities should set out how their section 106 policies will be varied at the time their CIL charging schedule is examined. Any relevant policy changes should be implemented at the same time the CIL charging schedule is introduced.

The Department for Communities and Local Government (DCLG) said in a statement that councils which are in the process of developing CIL proposals do not need to start their levy setting process from the beginning, but that support will be available to councils who choose to review their levy as a result of the new guidance.

The guidance also makes clear that there is no obligation for councils to charge the levy, and that they can set a low or zero rate if they wish.

“Government has worked actively with councils and developers to get this guidance right and make clear how we expect the levy to work," said planning minister Nick Boles. “The guidance ensures that councils who have already adopted their levy will not need to do anything new and only councils developing levy rates will need to consider this new guidance.”

“The development industry has raised a number of concerns about the Community Infrastructure Levy," said British Property Federation chief executive Liz Peace. "We have been closely involved in the development of this document and are pleased that it clearly sets out what local authorities must do when they are looking to charge the levy. These revisions should help support development by ensuring the levy is being implemented effectively."

“Councils are keen to continue work with the development industry in a positive and productive way that enables much needed development to take place in a way that is fair and equitable to developers and to local people," said Cheshire West and Chester Council leader Mike Jones.  "Discussions on the Community Infrastructure Levy have been conducted in this spirit.”

The guidance follows amended CIL Regulations adopted by the Government last month, which set out provisions to ensure that developers are not double-charged when they vary an existing planning permission.

The Government said it expects to consult on further regulatory changes in the new year. It said that it will continue to listen to issues being raised, such as "the need for greater clarity at an earlier stage on how the levy will be spent" and that it will consider "the suggestion to move the 2014 date when councils will be limited in their use of pooled section 106 planning obligations for infrastructure that can be funded by the levy".

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