Latest Position

Community Infrastructure Levy to be retained - 29th November 2010

The Government has announced that the Community Infrastructure Levy [CIL], introduced in April 2010 by the previous Labour administration, will be retained.

A number of detailed changes, which reflect the Governments localism agenda, are being proposed.  The new Localism Bill proposes that charging authorities [Unitaries, Districts and London Boroughs] will be required to allocate a meaningful proportion of levy revenues back to the neighbourhood from where it was raised.  Authorities will need to work with local neighbourhood bodies to identify needs arising from new development.

Local authorities will also retain the ability to use the levy to address the cumulative impact on infrastructure that may occur further away from the development.

Sporting and recreational facilities are specifically identified as within the definition of infrastructure for CIL purposes in section 216 of the Planning Act 2008.

[see http://www.communities.gov.uk/; press release dated 18 November 2010 entitled ‘Clark: Communities to share in the advantages of development’.

Community Infrastructure Levy Regulations - April 2010

Whilst the broad power for a CIL are contained in the Planning Act 2008, the detailed legislative framework for the CIL is contained in the latest regulations which gained parliamentary approval on 17 March 2010 and came into force on 6 April 2010.

The points below outline the changes which the CIL regulations appear to have introduced, specifically looking at the implications for sport.

• Payment by instalment is now allowed for, and 60 days will be allowed for one off payments.  In  the case of the largest liabilities, there is a provision to allow 240 days to pay the charge;

• CIL is levied on net additional floorspace rather then gross increase as suggested before; this is the same as current standard charges regimes;

• Payment in kind; developers can pay all or part of their liability by transferring land where the authority agrees;

• Exceptions; up to 100% relief can be accorded by a local authority for individual cases, subject to independent viability assessment;

• Prudential borrowing; the SOS can issue a direction allowing a local authority to borrow against future CIL income;

• Charity exemptions; only changes for ‘those who develop’. It has been suggested that sports clubs will not be greatly affected as they tend not to build above the 100sq m threshold, and they would only have a very low CIL as they are non commercial developments. These points however are debatable.  Perhaps if local authorities have the discretion (see above) they could exempt community sports clubs from CIL in their areas;

• Affordable housing exempt; the regulations allow for 100% exemption for affordable housing. [This would reduce receipts of developer contributions for sport if say 20-30% of all units fall in this category.  Affordable housing has higher occupancies, and residents are most likely to make use of publicly, rather than privately funded, sports provision, so it is not very logical]. 

• Local authority admin costs can be recouped from receipts of the Levy; this new provision will act as an encouragement to take up for authorities, allowing them to take up to 5% of receipts for this purpose;

• Planning obligations; the period of transition has been placed at four years. So by April 2014 local authorities will no longer be able to obtain pooled contributions (tariffs) to fund infrastructure that could be funded from CIL; 

• Place in law the planning obligations tests; From April 2010 it will be unlawful for a planning obligation to be taken into account in a planning decision on a development, which is capable of being charged CIL, if the obligation is not directly relevant and reasonably related in scale and kind to the proposed development.  The Government will consult on a new policy statement on the appropriate usage of planning obligations here.  This should not be serious as great efforts are made by local authorities to justify the use of contributions for earmarked sports schemes, so this rubric does not really apply;

• Limited pooling only allowed; although respondents to the consultation wanted to be able to carry on ‘pooling’ contributions, this is to be limited to five schemes in an area by the Government.  Beyond this such arrangements are deemed by Government to amount to a tariff and therefore should be implemented through CIL;

• There will be guidance produced for authorities on how to apply the new powers and regulations. This covers issues such as deciding the rate of CIL; what comprises an ‘up to date development plan’; relationships to infrastructure planning more generally; setting differential rates of CIL within LA area and procedures at CIL charging schedule examinations. Click here to view the guidance.

• There will need to be new guidance on the use of planning obligations; Currently CLG are consulting on a new policy for planning obligations which will reflect the introduction of CIL and related reforms. The Consultation on planning obligations covers the question of developer contributions for maintenance of sports provisions such as playing fields.  This is also important for sport as Government has said that it will continue to allow payments for maintenance for sports facilities through Section 106Problems may arise however as obligations must be for directly related facilities, but CIL does not have this restriction! Click here to view the consultation.

What do the regulations not address?

• How levels of CIL are to be set;
• How priorities as between sport and other infrastructure needs are to be established locally;
• How delivery of the programme of sports infrastructure improvements in the area and related to development is actually to be guaranteed;
• It is unclear how Sport England are to be involved in representation on draft infrastructure schedules.

The CIL regulations, and an explanatory Memorandum accompaning them, can be found by clicking here.