New scheme to boost local projects

New scheme to boost local projects

08 April 2015

A new national scheme is set to be adopted in Sheffield to attract developers’ contributions for citywide and local infrastructure projects.

The Community Infrastructure Levy (CIL) is a new scheme to secure these contributions towards infrastructure provision through the planning system. This will largely replace the individually negotiated planning arrangements known as Section 106 agreements.

Simon Green, the Council’s Executive Director of Place said: “The CIL will help us to deliver our strategic priorities for the development of the city. We are expecting an income of £3-4 million from this scheme once it’s established. This income will be generated through economic growth and reinvested into the city’s infrastructure.

“The scheme will be fairer, faster and more transparent than Section 106 and give the Council and local communities the freedom to agree on their key priorities. CIL will provide a predictable funding stream - making infrastructure delivery more efficient and give developers certainty and quicker planning decisions.”

The CIL is levied on new buildings and extensions to buildings according to their floor area, so money will be raised from developments to help the Council pay for essential infrastructure to support these new developments.

This infrastructure can include roads, schools, transport improvements, open space and public spaces, plus any other community facilities required to ensure sustainable growth.

The majority of the money received has to be spent on any new infrastructure needed as a result of a new development in any location. The levy will be paid by most new developments, although it will only be charged on new floor space and on larger schemes.

The Council’s Cabinet is expected to approve the new Charging Schedule at its meeting next Wednesday (15 April) and, if approved, will begin charging CIL on qualifying developments that receive planning permission from 15 July 2015.

The Community infrastructure Levy (CIL) allows local authorities in England and Wales to raise funds from developers undertaking new building projects in their area. The money can be used to fund a wide range of infrastructure that is needed as a result of development. This includes new or safer road schemes, flood defences, schools, hospitals and other health and social care facilities, park improvements, green spaces and leisure centres.

The CIL is now the Government’s preferred mechanism for delivering the wider infrastructure demand that new development creates, such as additional school places or open space. Section 106 has been further limited from 6 April 2015, when a restriction on pooling financial contributions from developers towards infrastructure was imposed. For these reasons CIL will be the best way of securing significant financial contributions for infrastructure from new development.

CIL is expected to deliver annual income of £3-4 million when established and in total a sum of between £11.3 million and £17 million by the end of 2019/20. There will be a gradual build-up of income, because payment is due on commencement of development and in instalments over two years thereafter, other than for the smallest payments.

In the medium to long term, CIL is anticipated to generate significantly more funds for infrastructure compared to Section 106, as it is more efficient than the current situation where contributions are negotiated on an individual basis as developments come forward.