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What is the community infrastructure levy?

The Community Infrastructure Levy (the levy) is a planning charge on new development. The ability for a local planning authority to charge the levy came into effect from April 2010, but cannot be set until an adopted Core Strategy is first in place.The Core Strategy was adopted in August 2011.

Government regulations and guidance set out the process to be followed in preparing a charging schedule including requirements for consultation and an Independent Examination. The charging schedule needs to be based on viability and infrastructure planning evidence.

The rate(s) (at pounds per square metre) set in a charging schedule must be based on appropriate and available evidence and must aim to strike a balance between the desirability of funding (in whole or in part) the estimated total cost of infrastructure required to support the development of the area, taking into account other actual and expected sources of funding; and, the overall potential effects of the levy on the economic viability of development across the area.

Independent Examination

The Council submitted the Draft Charging to the Planning Inspectorate for Examination on 22nd November 2012.  Further details on the Examination and all the documents submitted are available.

The Examination process has concluded with the receipt of the Examiner's Report PDF (162 KB) on 13th December 2012.

Draft Charging Schedule and Supporting Documents

The Draft Charging Schedule PDF (2 MB)

The supporting documents which informed the Draft Charging Schedule:

Consultation

The Preliminary Draft Charging Schedule was the first stage in setting levy rates.

The Preliminary Draft Charging Schedule was published for public consultation from 19th March 2012 to 30th April 2012. This document is available below:

Preparation Timetable

Following the conclusion of the Independent Examination, the Council has adopted the Levy which is in force from 1 May 2013

Frequently asked questions (FAQs)

Q1. Why has the Government given local authorities the ability to charge CIL?

Q2. Will all local authorities charge CIL and will the level be the same countrywide?

No, although the law allows local authorities in England and Wales to charge the levy, we do not have to. Authorities wishing to charge must produce and adopt a CIL charging schedule to set out rates (expressed as a £ per square metre of floor space) that will apply to different forms of development in their area. Differences in the infrastructure needs and the economic climate in different areas mean rates will vary across the country.

Q3. Will CIL rates be the same across all of an authority's area?

Not necessarily. Different rates for the same types of development may be set for different parts of an authority's area if there are differences in the viability of those types of development in different areas.

Q4. How does CIL relate to planning permission?

CIL will be charged on new buildings or extensions to buildings that have been allowed through some form of planning permission. That includes not just planning permissions granted by a local planning authority but also permissions granted through:

Q5. Will CIL rates be the same for all forms of development?

No not necessarily. As CIL rates are linked to the economic viability of development, different forms of development may attract different rates. For example, rates for new houses, new shops or new industrial buildings may all be different. In addition, the CIL rate for some types of development in certain areas may be set at zero because the economics of the proposed development would not support any CIL payment.

Q6. Is there any form of the independent scrutiny of CIL rates the council charges?

Yes, our draft CIL charging schedules were examined by an independent examiner from the Planning Inspectorate and found to be fit for purpose.  Any amendments to charging schedules must follow the same procedure.

Q7. How long will CIL rates apply for once a charging schedule has been adopted?

There is no fixed period. We will review the charging schedule from time to time to ensure that it remains appropriate. For instance, as market conditions change, the viability of certain types of development may also change.

Q8. What will CIL be used for?

CIL will be used to help pay for the infrastructure needed to support new development, such as roads, schools and recreational facilities. We have the discretion to spend the income on any infrastructure that supports the development of the area. We publish on our website details of what items of infrastructure CIL may be used for (called the "regulation123 list"), which will be updated from time to time.  Contributions will not be sought for any infrastructure items that appear on the list via s.106 planning obligations in order to avoid the possibility of developments.

Q9. How will CIL charges be calculated?

The CIL rates specified in the Charging Schedule will be charged for each square metre of net floor space provided in new buildings or extensions to buildings. All new dwellings will be charged, but other forms of development will only be charged if they have a floor area of more than 100 square metres. Where existing buildings are redeveloped, the floor area of the existing buildings will, in most cases, be discounted from the calculation.

Q10. Will CIL payments be index-linked to protect their real value?

Yes, CIL payments will be indexed in line with the "All-in tender price index of construction costs," a measure of building costs inflation produced by the Building Cost Information Service.  In Fareham the indexation came into effect for any planning permissions granted on or after 1 January 2014.

Q11. Can a reduction in CIL liability be negotiated?

No. Once a charging schedule is in effect, there is a legal obligation to pay the CIL at those rate(s).

Q12. Are any types of development exempt from paying CIL?

Yes, in these circumstances:

In all the above cases there are particular criteria to be met and the relief must be claimed using a prescribed form that is available on the Planning Portal.

Q13. When does CIL have to be paid?

The trigger for the payment is the start of the development.

Q14. Can CIL be paid in instalments?

Yes, we have adopted a written instalment policy that can be viewed on this website.

Q15. Can CIL be paid in kind?

Yes. CIL can, by written agreement before development starts, be paid in part or in full in kind. This means by way of transferring land (which may include existing buildings) to the Council. The monetary value of any payment in kind must be determined by an independent valuer.

Q16. Who is liable to pay CIL?

The liability to pay CIL defaults to the owner of the land on which the development takes place. When land is sold, liability to pay transfers to the new owner but the law does allow for another person or company to assume liability for it by submitting the relevant form to us.

Q17. How will the payment of CIL be enforced?

In most cases, the person/company liable for payment will pay without problem or delay. In cases where payment is not made or is made late, we have a range of enforcement measures, such as surcharges. In more serious cases, we have the power to issue a CIL stop notice which stops any further development until payment is made. As a last resort, courts can authorise the seizure of assets or impose a short prison sentence.

Q18. Will the imposition of CIL make some forms of development unviable?

Possibly, in setting CIL rates, a balance has to be struck between securing additional income for infrastructure to support the development and the potential economic effect of imposing CIL on developments. Although CIL only represents a very small percentage (less that 5%) of total development costs, it is possible that it will make some proposals that were already only marginally viable, unviable.

Q19. Will CIL money be used to fund the provision of infrastructure in the part of a local authority's area in which it was collected?

Not necessarily. We can use CIL money to help provide infrastructure to support development anywhere within the borough. It can also be used to help provide infrastructure outside the borough if the infrastructure will support development within the borough.

Q20. How will people know what a local authority has spent CIL monies on?

There is a legal duty on local authorities to produce an annual report which sets out details of our CIL income, expenditure and accumulated funds.  The report will be published on this web site.

Q21. How much CIL would be payable on an average size house?

Assuming a residential CIL rate of £105 per square metre and that an "average" 3 bedroom house has a floor area of 110 square metres, CIL payable would be:-
£105 x 110 = £11,550. This is a simple calculation that does not take into account the indexation which has to be applied to protect the real value of the payment. In times when building costs are rising, the effect of the indexation is to increase the amount payable each year following the year in which the charging schedule took effect. If buildings costs fall, the effect of indexation will be to reduce the sum payable.

 

For more information, contact us on 01329 236100 or planningpolicy@fareham.gov.uk




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