12

This has the potential to be helpful for extra-care housing development in the event that a CIL for extra-care housing is introduced.

Proposed CIL charge rates for Strategic Allocations (paragraph 9)
Bovis Homes Ltd is in the process of preparing a masterplan to support a planning application for the Strategic Allocation at North East Bexhill. The masterplan is still in preparation and discussions continue with the Council to agree the scheme's parameters/development quantums (residential and commercial uses, open space and other supporting infrastructure etc). Discussions have also commenced with the Council regarding the S106 to accompany the planning application. Currently the S106 is progressing on the basis that the application will be determined prior to the adoption of CIL, but with the potential for it to be varied should CIL be adopted prior to the determination of the application.

Bovis Homes Ltd are preparing a cost and viability model to inform the planning application and S106 discussions and until such time as the scheme's parameters/development quantums and its accompanying s106 package (i.e. including those items that would still be required in the event of CIL being adopted) are agreed with the Council, the cost and viability model cannot be finalised and it is not yet possible to properly and thoroughly test the scheme's viability, taking into account the impact of the proposed CIL rate (£100), additional s106 package and the local housing market conditions etc. It is therefore not yet possible to confirm whether or not, the proposed CIL rate of £100 for strategic allocations renders the NE Bexhill scheme unviable. However, experience on CIL rates in other comparable value areas would seem to suggest that the Strategic Allocations rate may be on the high side, particularly as primary education provision and off site highways infrastructure is excluded from CIL for the strategic allocation (reg 123 list).

Bovis Homes Ltd therefore wish to register a holding representation and reserve the right to provide a more definitive answer on the CIL Charge rate and site viability (based on an agreed masterplan and up-to-date cost/market condition information) potentially through written statements prior to the CIL examination (if requested by the Inspector) and at the hearing sessions.

CIL Charging Zones (paragraph 10)
Bovis Homes Ltd supports the proposal that strategic allocations have their own charging zone.

Proposed Instalment Policy (paragraph 12)
Bovis Homes Ltd considers it essential to introduce an instalment policy for strategic allocations. Without such an approach, the initial CIL liability may render the scheme unviable. Bovis Homes Ltd, hope to be consulted on the Instalment policy for the Strategic Allocations.

Exemptions and Discretionary Relief from CIL (paragraph 15)
Bovis Homes Ltd consider it essential for local discretion on CIL charging, particularly on strategic allocations to take account of viability issues and should the Council's prioritise affordable housing over CIL receipts.

Proposed Regulation 123 list (paragraph 17)
Bovis Homes Ltd does not agree with the regulation 123 list's exclusion of a new primary school and nursery at the NE Bexhill Strategic Allocation from the items covered by CIL. If related education facilities are required, which is the case in NE Bexhill, effectively the NE Bexhill strategic allocation's landowners/developers are being charged twice, to fund primary education facilities related to their development and also other primary education provision elsewhere in Bexhill. The education 'bill' is very significant part of the s106 and a key component of determining the allocation's viability. All education facilities should be provided through CIL.

NE Bexhill land values (PBA report)
The PBA report does not confirm whether the NE Bexhill Strategic Allocation threshold land value of £700,000 is related to a net developable hectare or gross developable hectare of the strategic allocation. The NE Bexhill masterplan currently has a relatively low (compared to smaller sites) net to gross development ratio, due to the need for strategic open space corridors, landscaping, sports pitches, primary school and ecology mitigation corridors etc. Bovis Homes Ltd will have clearer view of the threshold land values at NE Bexhill following the completion of the viability modelling, and will be able to advise through the submission of additional material to/appearance at the hearings. Also, the fact the Council has allowed for elements of the NE Bexhill Strategic Allocation in advance of the main part of the site will have some effects on viability and threshold land values.

COMMUNITY INFRASTRUCTURE LEVY (CIL) - PROPOSED ROTHER DISTRICT (DC) CHARGING SCHEDULE

Background

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/6313/1897278.pdf

"Communities should reap the benefits of new development in their area and these reforms will put in place a fairer system for funding new infrastructure while also providing certainty for industry. Too little of the benefits of development go to local communities, and our ambition is to correct that with a reformed levy under genuine local control." Minister Greg Clark in late 2010

"Communities with approved neighbourhood development plans will receive 25% of any CIL raised from housing developments within their area. The money will be paid directly to parish and town councils, which can use it to back their priorities for their communities, although they would be expected to work with the local planning authorities."

Planning Minister Nick Boles on 11 Jan 2013

In August 2014, Rother DC circulated its intention to introduce the CIL to part-replace the existing means of securing developers' contributions using S106 procedures. Rye Town Council is now invited to AGREE these comments on the Rother DC proposals.

Summary of Main Changes since August 2014
- Para 3: Benefits of CIL: still no mention of benefits to those councils Neighbourhood Planning
- Para 5: Change to justification: £49m costs; perceived £32m income from CIL; therefore funding gap. Detailed justification of gap has been adjusted in a separate analysis. (£49m = education - 15m; transport 5m; community infrastructure , including Rother Eastern Tidal Walls = 30m)
- Para 8: Inclusion that CIL rates to be reviewed after 3 years
- Para 9: Rates reduced: Zone 2 residential from £160 to £135
- Para 16: Inclusion that further relief policy to be published later
- Para 20: Inclusion that councils with NP receive 25% of levy
- Appx 2: Draft 123 list amended to be less specific. There is a need to ensure that the categories are complete because change will require public consultation.
- IDP:
o It is noted that there is nothing planned by way of improvements to the A259 corridor east of Hastings.
o An assumption is that if the business case for fast Javelin (HS1) succeeds, then the infrastructure project to introduce the service would be funded by Central Government.

What are the Key Questions?

When the last draft was circulated there was extensive discussion in the community about the justification for CIL and how infrastructure related to development should be funded. The RNPSG has re-visited some of the key questions.

Should there be Developers' Contribution for related infrastructure?

Almost all developments have some impact on the need for infrastructure, services and amenities. Therefore as the majority of new build residential development is zero rated for VAT, it is only fair that such development pays a share of the cost. It is also right that those who benefit financially from successful planning proposals should contribute some of that gain to the community.

Why is CIL proposed to part-replace the current S106 Procedure?

The Government considers that CIL would be fairer, faster, more certain and transparent than the current system of planning obligations to contribute. Presently, contributions are negotiated on a 'case-by case' basis.
Statistics show that under the current system of developers' contributions only 6% of all planning permissions nationally (usually the largest schemes) have contributed to the cost of supporting infrastructure. Through CIL, all but the very smallest building projects will contribute.

Rye TC NOTES that the Government suggests that there are a range of benefits accrued from the CIL process, including that the Levy:

a) collects contributions from a wider range of developments, providing additional funding to allow local authorities to carry out a range of infrastructure projects that support growth and benefit communities;
b) provides those parishes with Neighbourhood Plans (NP) a receipt of 25% of the CIL to spend on local infrastructure projects. For Rye, some guidance on the likely receipts to 2028 would be from:
- dwellings:
 160 dwellings; deduct around 60 likely to come forward as planning proposals before CIL introduction, balance say 100.
 Average dwelling is 88-100sq m X £135 = around £12k
 100 dwellings x 12k = £1.2m;
 25% of receipts to Rye to 2028 = around £300k
- commercial development. This is more difficult to estimate because of the differing types of contributions, that might be negotiated. But, Rother DC has advised that some 25% of any CIL collected would pass to Rye TC for recorded local infrastructure projects. What is possible is to catalogue the sort of infrastructure that has been or will be funded by developers' contributions as below:

Valley Park: SUDS installation, roads, recreational equipment, cycle and footpaths and planting.

Former Tilling Green School Site: Roads and green space and planting, affordable housing, community centre and flood mitigation.

Former Lower School Site: Roads, planting and Station Approach improvements. (The Javelin proposal now makes uncertain any talk of rail crossing improvements in this category of works).

Former Freda Gardham School Site: Affordable housing, roads and pathways, planting and flood defence improvements.

Rock Channel and Strand: Roads and pathways, riverside walks, planting and affordable housing.

Rye Harbour "Saltings": contamination clearance, roads and compensating nature reserve assets.

c) gives authorities greater flexibility to set their own priorities on projects benefitting the wider community affected by development, unlike S106 funds which require a direct link between a contributing development and an infrastructure project;

d) provides developers with clarity about the level of contributions which are required from any development and provides transparency for local people;

e) is non-negotiable and therefore should save time by removing the need for negotiations between the local authority and developers as occurs under S106. f) requires Rye TC to make a local Infrastructure Delivery Plan as an adjunct to the Neighbourhood Plan. Site assessments will inform infrastructure requirements and involve liaising with the relevant agencies - EA, Highways etc. Examples would be the Eastern Rother Tidal Wall for Frieda Gardham, the community centre for Tilling Green or a suitable access arrangement for the Lower School Site.

g) is being adopted fairly slowly by the 433 principal authorities in England and Wales. This is partly attributed to the government extending the deadline for S106 pooling contributions until April 2015. Post April 2015 it is expected that many authorities will put more resource into getting CIL adopted, because LPAs will wish to secure the advantage of infrastructure contributions under CIL from developers. The legislative framework is expected to work against them if they do not have CIL in place.

As Rye Town Council is making a Neighbourhood Plan to allow the community to influence growth, it NOTES that it will have the right to receive and spend 25% of CIL contributions on local projects.

Is there an infrastructure funding gap in Rother District?
On the figures provided in the revised Rother DC analysis - particularly in terms of education capacity, flood defences and transport schemes - Rye Town Council AGREES that there is an infrastructure funding gap, even without considering any infrastructure projects yet to be generated by the Rye NP.

What are the rates for residential uses?

Rye Town Council NOTES that the proposed rate has been reduced (£160 to £135 per sq m) and that "strategic allocations" (Zone 4) have been omitted. However it continues to emphasise that the level of CIL must be "appropriate" because of the risk that it might render future development non viable and therefore deter development.

Will not the charges increase house prices? A common misconception is that CIL will drive up local house prices. While development economics are complicated, the prices of new houses are usually set by agents with regard to comparable existing properties and market forces. CIL will either reduce the profits of developers or, more likely in the longer term, the price that they pay for the land. CIL could be regarded as a development land tax, giving local communities some of the uplift in land values as a consequence permission to build. Rother DC advises that CIL rates assume substantial returns to landowners, ranging from at least £700,000 per hectare in Bexhill to £1.3m per hectare in most rural areas. It is also estimated that the CIL charge will be a small percentage of the total build costs and significantly lower than the affordable housing contribution. CIL is not seen as impacting significantly on developers' profit margins (industry standard being 20%). It is likely to be landowners who will see a correction in future land deals.

What are the rates for non-residential development?

Rye Town Council NOTES that the proposed charges remain in the upper part of the band being set by Councils. Rye TC NOTES that high rates of CIL should not discourage development (reducing employment opportunities and local tax revenues) by increasing the cost (freehold or leasehold) of commercial property.
Rye Town Council NOTES that there will be an instalment procedure for developers' contribution.

What is the discretionary and exceptional relief policy?

Rye Town Council NOTES that some details are published as before, but others will come separately. It RECOMMENDS that it be consulted about what more will be included.

For example, while it is important to exempt those developments, which would be rendered uneconomic by the levy, does Rother DC have in mind to exempt some sort of "strategic" developments as other Councils are doing? Rye Town Council RECOMMENDS that it is consulted, to avoid it being denied the levy from developments in its NP.

What is in the draft 123 list?

Rye Town Council NOTES the changes in the draft Infrastructure R123 list. Further it notes that any significant change would have to go to public consultation. It is expected that all infrastructure projects emerging from the Rye NP are likely to be covered in the draft list of categories, such as education, health, community infrastructure and transport.

Are there any omissions from the proposed schedule?

S106 versus CIL?

National guidance indicates that the CIL will run in tandem with some residual Section 106 obligations. Rye Town Council NOTES the remarks in the draft schedule about the intention not to "double dip" (applying both CIL and S106). However, for many, what is not clear is the precise relationship between these two charges. Professional planners acknowledge that the rules for the future application of CIL and residual s106 are complex. On the assumption that CIL is agreed, section 106 planning obligations will continue to be secured, although application will be scaled back. Site-specific planning obligations will be sought where infrastructure:
 does not appear on the Regulation 123 list;
 does not conflict with the Regulation 123 pooling restriction, that limits the pooling of s106 payments to no more than five planning obligations; and
 fulfils the planning obligation tests set out in Regulation 122.
Many councils have attempted to clarify the position by producing a typical guidance chart below. Rye Town Council continues to RECOMMEND that Rother District Council produces some similar clarification, perhaps along the lines of that below.

Comparing CIL and s.106 - Typical Explanatory Chart
Infrastructure funded by CIL
Infrastructure funded by S106
Provision, improvement, replacement, operation or maintenance of education facilities
Provision, improvement, replacement,
operation or maintenance of health care facilities
Provision, improvement, replacement,
operation or maintenance of clearly
identified infrastructure projects, such as transport.
Provision, improvement, replacement,
operation or maintenance of public open space
S106 for affordable housing
S106 for standard site /design mitigation
Development specific mitigation
Public Realm projects or types that are pre-defined.
Employment and skills training
Provision, improvement, replacement,
operation or maintenance of public sports and leisure
Provision, improvement, replacement,
operation or maintenance of community facilities (as identified in the Neighbourhood Plan)

What are the means for Enforcement and Appeals?

Rye TC NOTES that there is no explanation of enforcement and appeals. The draft schedule makes it clear that "CIL is non-negotiable" and that there are significant powers and penalties to deal with failure to pay: Stop Notices, surcharges, late payment interest and prison terms.

Rye TC RECOMMENDS that Rother DC advises on those situations where appeals by developers might be possible, which it understands might include circumstances where officers have incorrectly:

 calculated the amount of CIL. (Before making the appeal the developer must first request an internal review by the Council).
 apportioned liability between landowners.
 determined Charitable Relief.
 applied surcharges.
 determined the date at which any development has commenced.
 issues a Stop Notice for non-payment.

Paragraph 4
Sussex Police strongly support the introduction of the Community Infrastructure Levy within the charging area of Rother District, as set out in the Draft Charging Schedule.

The Infrastructure Funding Gap Analysis provides evidence that there is a significant funding deficit, and the proposed levy will go partway to bridging that gap and thereby providing the infrastructure needed to support development in the Core Strategy. This infrastructure, including that required by Sussex Police, is vital to addressing the impacts of future development and achieving safe and sustainable future communities.

Paragraph 12

It is noted that an Instalment Policy is proposed for the charging of the levy. It is agreed that this is a realistic approach to the application of CIL and will balance the desirability of funding necessary infrastructure against the potential effect on economic viability of doing so. However, the provision of policing infrastructure is critical to the delivery of safe, sustainable communities and will need to be provided at early stages of the development process. This is evidenced by the increased crime rates Sussex Police have noted in connection with theft from construction sites. There is also a need to provide safe and accessible environments where crime and disorder, and the fear of crime do not undermine the quality of life or community cohesion as part of planning for sustainable development and communities, as outlined in paragraphs 58 (5) and 69 (3) of the National Planning Policy Framework 2012. This is raised for information only, to inform the drafting and application of any Instalment Policy, and to ensure that policing infrastructure is recognised as a critical infrastructure type which should be considered early in the application of CIL.

Appendix 2
Sussex Police fully support the Draft Regulation 123 List accompanying the Draft Charging Schedule. The inclusion of 'Emergency Services' to be wholly or partly funded by CIL is particularly welcomed. It is also noted that this funding is for the 'provision of facilities.' Use of the term 'facilities' is welcomed as this ensures the levy may be utilised for the necessary provision, expansion and adaptation of Police Stations and Estate, as well as the provision of wider community safety facilities and supporting infrastructure, as permissible under CIL Guidance.

However, it is noted that no specific 'Emergency Services' infrastructure is included within the Draft Regulation 123 List, nor within the latest draft of the Infrastructure Delivery Plan (IDP) Schedule (February 2015). While it may be appropriate to maintain the general reference to "Emergency Services: Provision of facilities to address future needs" within the Regulation 123 List, Sussex Police would welcome inclusion of more detail on the Force's infrastructure needs within the IDP. This would provide further guidance and evidence that the Draft Charging Schedule and Regulation 123 List are based on appropriate available evidence on infrastructure planning. It would also ensure that this infrastructure is included as fundamental to the delivery of the objectives and spatial strategy of the Core Strategy, and provide a timeframe and importance rating for the provision of policing infrastructure.

Noting that the IDP is intended to be a "living document", Sussex Police would welcome further joint work on inclusion of more detailed information on policing infrastructure within the IDP Schedule, in the appropriate format. This should be based on the infrastructure needs set out to Rother District Council in June 2014. In summary, these include:

* Capital estate projects associated with accommodating additional staff required to provide policing services to the growing population of Rother, including the need to adapt Bexhill and Rye Police Stations to sufficiently accommodate new staff and equipment. There will also be the need to consider space in the new Battle Police Station, when this is reprovided as set out in the Sussex Police Estates Strategy 2013-2018.
* As Sussex Police provide force wide policing, there are also cross boundary infrastructure requirements. The Sussex Police Headquarters (based in Lewes) would require extension, adaptation and modernisation over the coming years to meet the policing needs of the growing population at a force-wide level, including the growth identified in Rother. There are also costs associated with custody provision from Hastings and Eastbourne for Rother, which are required as a result of development across all Districts in Sussex.
* In addition to the extended/refurbished/new police stations required, there will also be capital costs associated with providing supporting infrastructure required in connection with new development. This supporting infrastructure may include additional fleet (in the form of marked and unmarked cars to enable police patrols or operation of our Road Policing Unit); additional IT/Communications (including remote IT facilities to enable more effective policing and carrying out of duties on site, away from local police stations); supporting equipment (such as the provision of Automatic Number Plate Recognition cameras on key transport links in the District, including the new Hastings/Bexhill Link Road to aid in the detection of crime, and/or CCTV cameras within key locations of Anti Social Behaviour); and start up costs associated with the additional staff needed due to increased crime levels associated with new development (such as uniform costs, protective equipment costs, initial training).

I write on behalf of our client - Marchfield (Strategic Land) Ltd - in response to the consultation on the Rother District Council Draft Charging Schedule (DCS) and Draft Regulation 123 (R123) List.

Our client has commissioned a report from Pioneer Property Services Ltd that builds on observations raised previously by JB Planning Associates in response to the Preliminary Draft Community Infrastructure Levy Charging Schedule (August to September 2014) and includes additional observations on the basis of the updated evidence now published by the Council.

The overall conclusion of the attached report is that, in addition to a lack of compliance with national guidance, the DCS is not in accordance with CIL Regulation 14 for a variety of reasons relating to both the evidence base and Draft R123 List. The report also raises concerns regarding the impact of the Draft R123 List on the pooling of S106 contributions post April 2015 as a result of the lack of clarity within the Draft R123 List.

I appreciate that the Council response form expresses a preference for each representation to be related to a paragraph of the DCS but in essence it is the document as a whole that we consider to be contrary to the Regulations by virtue of an inadequate evidence base, hence why the representations are presented in a report format for attachment to the response form. In our view, it is not a case of simply recommending amendments to the DCS but rather that we consider that significant additional work is required before the DCS or the Draft R123 List can be considered sound.

The key conclusions of the Pioneer report are:

Until further work on the IDP and associated evidence base is undertaken and the SADPD is meaningfully advanced the viability assessment cannot be robustly progressed and a CIL Charge should NOT be introduced. The Charging Rates proposed through the DCS (Table 1) are not robustly demonstrated to be viable, particularly in combination with post CIL planning obligation costs and site specific Strategic Infrastructure costs on larger Greenfield and Strategic sites. Currently the DCS does not accord with CIL Regulation 14 or national guidance. Crucially:

The DCS should not be progressed until it is informed by additional work
undertaken to take the concerns set out above regarding the IDP and viability
evidence base into account.

It is agreed that it should include an instalment policy.

The introduction of a policy to offer discretionary relief for Exceptional
Circumstances (i.e. in response to economic viability on a case by case basis for
eligible developments as set out in the National Planning Policy Guidance)
would be welcomed, particularly given the viability concerns raised above.
However, the introduction of relief from the CIL payment is a poor substitute for
ensuring viable and deliverable CIL payments and Development Plan policies at
the outset, and cannot render a planning approach that results in an unviable
cumulative level of CIL / Policy burdens in accordance with national guidance.

Currently there remains a lack of clarity in terms of whether the CIL items set out
in the Draft R123 List can 'operate in a complementary way' with the Section 106
contributions that will be sought in accordance with the NPPG and the underpinning CIL Regulations. Concerns have been raised in previous CIL
representations submitted on behalf of Marchfield (Strategic Land) Ltd in
September 2014 regarding the transparency of the Draft R123 List.

In summary, the amended DCS, Draft R123 List and updated supporting evidence base do not resolve concerns raised in these and previous representations submitted on behalf of Marchfield (Strategic) Land Ltd and further it is our view that the DCS is contrary to CIL Regulation 14 and national guidance. In addition, it is our view that the Council is likely to encounter significant problems with the impact of R123 on the pooling of S106 contributions
post April 2015 unless the lack of transparency within the Draft R123 List is resolved.

To view the report by Pioneer please click on the following link:

http://www.rother.gov.uk/CHttpHandler.ashx?id=23609