Community Infrastructure Levy - Wiltshire's 'Roof Tax'
The Community Infrastructure Levy (CIL) is a new charge that local authorities in England and Wales can impose on development in their area. The money generated will contribute to the funding of infrastructure.
CIL will contribute towards bridging the gap between the total cost of infrastructure necessary to deliver new development and the amount of funding available from other sources. It partially replaces the 'Section 106' system, whereby developers were required to pay for particular projects in return for planning permission.
Wiltshire Council wants to use CIL because of upcoming changes, brought through the new national planning legislation, to the way developer contributions are collected. From April 2014 Section 106 obligations will be strictly restricted to site-specific infrastructure. The current system allows numerous S106 obligations to be pooled to pay for a particular infrastructure project. From April 2014 the council will only be able to pool the monies from a maximum of 5 S106 obligations towards an infrastructure project. This is because CIL is expected to provide funding for offsite infrastructure requirements across Wiltshire while Section 106 will be focused on delivering site specific infrastructure.
The government believe the tariff based approach of CIL provides the best framework to fund new infrastructure as CIL is considered to be fairer, faster, and more transparent than the current system. The charging of CIL will allegedly benefit developers by providing certainty over the costs for development, and give the Council and communities more choice and flexibility into how infrastructure is funded.
CIL is to be charged per square metre on the net additional increase in floor-space of any new development of 100m² or more, or any additional dwelling. The amount of CIL a development site is liable to pay is based on its size, type and location. The rate(s) of CIL are to be set by the Wiltshire Council and will be published in what is known as a 'Charging Schedule'. The Levy is usually payable by the developer on commencement of development, although the Council has the option of introducing an instalments policy.
Relief and exemption from CIL is made to charity landowners. The council can also choose to offer 'exceptional circumstances' relief as part of CIL (exceptional circumstances require case by case detailed examination and are related to whether CIL liability has had an unacceptable impact on a development's viability).
Planning regulations say there should be no double charging for infrastructure through CIL and Section 106. Therefore, after a CIL charging schedule is adopted planning obligations will be used only to deliver site-specific mitigation requirements and affordable housing whereas CIL money will be pooled from multiple developments to fund infrastructure priorities across Wiltshire.
Informed by the Infrastructure Delivery Plan (IDP), a 'Regulation 123' list will identify which infrastructure projects will be eligible to receive money from the CIL. Amendments to the CIL Regulations in 2012 state that the Council must allocate a share of the Levy raised in a neighbourhood to deliver infrastructure that neighbourhoods want, although this 'meaningful proportion' is yet to be set by the government. In addition a proportion will also be allocated for admin costs associated with processing the CIL, this proportion is also still to be decided.
A Charging Schedule will set out the rate(s) of CIL to be charged across a local authority area. The rate(s) should be informed by an up to date development plan, infrastructure planning evidence base and viability assessment. CIL must strike a balance between contributing to funding infrastructure and not putting overall development at risk.
Consultants BNP Paribas were appointed by the Council to prepare the economic viability report to support the development of a CIL charging schedule for Wiltshire.
The WC Cabinet will be considering the proposed rate of CIL for Wiltshire on the 10th September 2012. The proposed CIL rates for Wiltshire will be revealed in the Cabinet paper, to be published at the end of August.
The Council will then produce a Preliminary Draft Charging Schedule for Wiltshire. A consultation will take place between 1st October and 12th November. The charging schedule will then be revised in light of comments received and undergo a further stage of public consultation, followed by a public examination in 2013. The Council will adopt the charging schedule next summer.