S106 Agreements and CIL: What You Need to Know

As a property developer, it is essential to be well-versed in the legal requirements surrounding planning permission. Two of the most important aspects of planning permission are S106 agreements and CIL (Community Infrastructure Levy). This article will provide an overview of what S106 agreements and CIL are, how they work, and what they mean for property developers.

S106 Agreements

S106 agreements are legal agreements between a property developer and the local council. They are used to mitigate the impact of new developments on the local community. The agreement outlines specific requirements that the developer must meet, such as the provision of affordable housing, the construction of new roads, or the creation of public green spaces.

S106 agreements can be costly to developers, as they often require significant financial contributions. However, they are an essential part of the planning permission process, and failure to comply with the agreement can result in legal action. In addition, S106 agreements can also be used to negotiate the terms of planning permission, such as building heights or the design of the development.

CIL

CIL (Community Infrastructure Levy) is a financial contribution that developers must make to the local council. Like S106 agreements, CIL is used to mitigate the impact of new developments on the local community. The money raised from CIL is used to fund infrastructure projects, such as schools, roads, and hospitals.

CIL is a fixed charge, based on the size and type of the development. The charge is calculated per square meter of new development, and the rate varies depending on the location. Developers are required to pay the CIL charge before they can start work on the development. Failure to pay the charge can result in enforcement action by the local council.

S106 Agreements vs. CIL

While both S106 agreements and CIL serve the same purpose, there are some key differences between the two. S106 agreements are negotiated between the developer and the local council, and the terms of the agreement are specific to each development. CIL, on the other hand, is a fixed charge that applies to all new developments in the area.

In addition, while S106 agreements are used to mitigate the impact of the development on the local community, CIL is used to fund infrastructure projects that benefit the local community as a whole. Finally, S106 agreements can be used to negotiate the terms of planning permission, while CIL is simply a charge that must be paid before work can commence.

Conclusion

In conclusion, S106 agreements and CIL are two essential aspects of the planning permission process for property developers. While both are used to mitigate the impact of new developments on the local community, they differ in their application and purpose. As a property developer, it is vital to be familiar with both S106 agreements and CIL to ensure compliance with planning permission requirements and avoid legal action.