This chapter is from Localism and Planning (Bloomsbury Professional), which is a clear, practical guide to what the reforms in The Localism Bill are likely to mean in practice for developers, local authorities, planning consultants and communities. The Bill, due to be enacted in April 2012, provides the most radical reform of planning law for 20 years. This book covers not just the Bill but other proposed legislative changes and the Government's policy direction on planning issues more generally (for example its proposed National Planning Policy Framework, due to be finalised by April 2012).
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Table of Contents
The Community Infrastructure Levy ('CIL') is a charge arising on development granted by planning permission. Local authorities in England and Wales may charge it and use it to raise money from owners and developers of land, to fund infrastructure to support the development of its area. Local authorities wishing to charge the CIL must produce a charging schedule setting out the rates at which it will charge it, in pounds per square metre.
The Government's view is that this tariff-based approach is fairer, faster and more certain and transparent than the current system for capture of developer contributions, namely planning obligations, which is lengthy and subject to negotiation. In contrast the CIL is not subject to any negotiation. Government research states that only six per cent of all planning permissions brought any contribution to infrastructure costs required as a result of development and anticipates that the CIL has the potential to raise an estimated £1 billion a year of funding by 2016.
The legislative basis for the CIL is found in the Planning Act 2008 ('PA 2008'), Pt 11 as amended by ss 114 and 115 of the Localism Act and the Community Infrastructure Levy Regulations 2010 (SI 2010/948), as amended by the Community Infrastructure Levy (Amendment) Regulations 2011 (SI 2011/987), (the 'CIL Regulations'). The CIL Regulations came into force in April 2010 and the amendments came into force on 6 April 2011.
Guidance made pursuant to PA 2008, s 221 was issued by DCLG in March 2010 in Charge Setting and Charging Schedule Procedures (the 'DCLG Guidance').
In October 2011, DCLG issued a consultation document setting out further proposals for reform of the CIL Regulations. The consultation period ended on 30 December 2011 but the Government has not yet issued any further announcements.
The CIL is a charge in respect of development. PA 2008, s 206 empowers the Secretary of State to make regulations providing for the imposition of a CIL and in making the regulations is required to ensure that the overall purpose of the CIL is to ensure that costs incurred in supporting the development of an area can be funded by owners or developers of land. This must be done in a way that does not make the development economically unviable.
The CIL Regulations must require that authorities that charge the CIL use it to support development by funding the provision, improvement, replacement, operation or maintenance of infrastructure. The CIL Regulations may also specify maintenance and operational activities (including operational activities of a promotional kind) in connection with infrastructure that may be funded by the CIL. Infrastructure includes roads and other transport facilities, flood defences, schools and other educational facilities, medical facilities, sporting and recreational facilities and open spaces. An authority charging the CIL may use the CIL it has raised to fund infrastructure outside its area, provided it supports the development of its area. In London, the Mayor's CIL must be applied to funding roads or other transport facilities including, in particular, funding for Crossrail.
Following amendments introduced by the Act, there are now also regulation-making powers aimed at requiring authorities charging the CIL to pass funds raised through the CIL to other bodies; those funds may be applied to infrastructure or any other matter that supports development by addressing the demands that it places on the areas that host it, by those other bodies. Regulations may set out details for this process including the area in which it will apply, the bodies it will apply to, the amount and timings of payments, things that may or may not be funded, monitoring, accounting and reporting responsibilities of charging authorities, and when funding is to be returned to the charging authority. Regulations may also allow that the authority applies some or all of the CIL raised in an area to the same extended matters, but only where they are not required to pass that proportion of the CIL to other bodies.
Although the legislative provisions are drafted very broadly, the intention with respect to these provisions was given some further detail in the October 2011 consultation document issued by DCLG. It included consultation on the issue of how to require charging authorities to pass on a proportion of funds received through the CIL to other bodies. In the consultation, the Government states its intention is to require authorities to allocate a 'meaningful proportion' of the CIL revenue to the local elected council for the area, where development will take place. The consultation sought views on who should receive these 'neighbourhood funds', the proportion to be passed on, timing, reporting and monitoring of payments and the relationship between neighbourhood funds and planning obligations.
The consultation also sought views on whether the CIL should be permitted to fund affordable housing either in isolation or in combination with s 106 obligations.
The CIL may be charged by 'charging authorities' and a local planning authority is the charging authority for its area, subject to certain exceptions as follows: the Mayor of London is the charging authority for Greater London, in addition to local planning authorities; the Broads Authority is the charging authority for the Broads; and the Council of the Isles of Scilly is the charging authority for the Isles of Scilly.
The CIL is collected by 'collecting authorities' and charging authorities are the collecting authority for the CIL charged in their areas, subject to the following:
In relation to the CIL charged by the Mayor of London, the London borough council in whose area the development giving rise to the CIL is located, is the collecting authority for that CIL.
A county council is a collecting authority for the CIL charged in its area in respect of developments for which it grants planning permission.
The Homes and Communities Agency, urban development corporations and enterprise zone authorities can agree with charging authorities that they will collect the CIL in respect of development for which they grant planning permission.
Following the coming into force of the Local Authorities (Contracting Out of Community Infrastructure Levy Functions) Order 2011 (SI 2011/2918) on 7 December 2011, charging and collecting authorities are permitted to contract out any of their functions in relation to the setting, charging, collection, enforcement and spending of the CIL. However, they may not contract out of key functions concerning preparing, implementing and withdrawing a charge for their areas. In practice this means they must still carry out any function where a meeting of the authority is required to approve something.
An authority intending to charge the CIL must issue a document called a charging schedule, which sets out rates or other criteria by reference to which the amount of the CIL chargeable for development is to be calculated.
In setting its CIL rates, the charging authority must aim to strike an appropriate balance between the desirability of funding infrastructure from the CIL, taking into account other actual and expected sources of funding, and the potential effect taken as a whole of the imposition of the CIL on the economic viability of development across its area. It may also have regard to the administrative expenses in connection with it. (Up to five per cent of CIL funds can be spent on costs incurred in administering the CIL.) In relation to the potential effects of imposition of the CIL on economic viability, a London borough must take into account any CIL charged by the Mayor of London.
The charging authority can determine the format and content of a charging schedule but the rates must be set out in pounds per square metre. A charging authority can set differential rates for different zones in which development is situated or by reference to different uses. However, the DCLG Guidance makes clear that differences in rates need to be justified by reference to the economic viability of development and not by reference to the costs of infrastructure. In connection with this, it warns against setting differential rates in such a way as may give rise to notifiable state aid, an element of which is selective advantage.
The charging authority must use 'appropriate available evidence' to inform preparation of the charging schedule and the CIL Regulations may make provisions as to what constitutes appropriate evidence. As this is an amendment to PA 2008 introduced by the Act, the CIL Regulations do not as yet contain any detail on this and neither have any other regulations yet been made. However, the DCLG Guidance gives further details in relation to the necessary evidence base for charging schedules. The Government expects appropriate evidence to include an up-to-date development strategy for the area, which should normally be in a draft or adopted core strategy in England, local plan document in Wales or the London Plan in the case of the Mayor of London.
A charging authority needs to consider the infrastructure it needs, ideally drawing directly from information from the infrastructure planning underpinning its development plan, and funding available from other sources, in order to identify its infrastructure spending gap. Additional bespoke infrastructure planning can be undertaken if it is considered that the existing plan is not sufficiently current or weak, but its purpose is not to challenge the soundness of an adopted development plan.
An authority intending to issue or revise a charging schedule must prepare a preliminary draft and consult certain other specified local planning authorities or local authorities, local business people in the relevant area, and (where the authority considers it appropriate) voluntary bodies or bodies representing local business people. It must take account of any representations received before publishing the draft charging schedule that it intends to submit for examination in accordance with PA 2008, s 212. It must then publish the draft charging schedule in the manner set out in the CIL Regulations.
The charging authority has to appoint an examiner to examine the draft charging schedule before it can approve it. Any person can make representations on a draft charging schedule and they can request the right to be heard by the examiner. The CIL Regulations, reg 19 sets out the various documents that must be submitted with the draft charging schedule to the examiner, which includes any representations made and a statement of any modifications the charging authority made to the draft charging schedule after it was published.
In examining the draft charging schedule, an examiner must consider whether the various factors that the charging authority must have regard to in setting its CIL rates have been complied with (as set out in PA 2008 and the CIL Regulations) and must make recommendations and give reasons for his recommendations in relation to the schedule. The recommendations that he can make are as follows:
that the draft be rejected if he considers that the drafting requirements have not been complied with and this cannot be remedied by modifications;
that the draft be approved with certain modifications, where the drafting requirements have not been complied with but this can be remedied by making modifications; or
that the draft be approved.
The examiner must consider any representations received in relation to the draft charging schedule and any person who makes representations must be heard by the examiner if they request to do so. (Where modifications are made to a draft charging schedule after it has been published and a person makes representations in relation to those modifications, they may request to be heard by the examiner but only in relation to those modifications.) The examiner decides how a hearing is to be conducted including deciding the amount of time to be allowed for hearing representations, and he may refuse to allow representations at the hearing if he considers that they are irrelevant, frivolous, vexatious or repetitious.
There are provisions allowing two or more charging schedules to be examined as part of the same examination if charging authorities who prepared the schedules agree. Examinations of charging schedules may also be carried out jointly with an examination of a development plan document under the Planning and Compulsory Purchase Act 2004, s 20 or examination of a local development plan under the Planning and Compulsory Purchase Act 2004, s 64. In relation to Greater London, a charging schedule may be examined jointly with an examination in public of the Mayor's spatial development strategy.
The examiner must submit his recommendations and reasons in writing to the charging authority and the charging authority must publish them in accordance with and in the manner set out in PA 2008, s 212(8) and the CIL Regulations, reg 23. Errors in the examiner's report may be corrected, provided those errors are 'correctable errors' which either do not alter the substance of the recommendations or reasons, or which must be corrected to make the recommendations consistent with the reasons given for the recommendations. This is permitted where the draft charging schedule has not been approved by the charging authority and the examiner may correct the error of his own volition or if requested to do so by the charging authority.
A charging authority must then approve its charging schedule but can only do so where an examiner has made recommendations and the charging authority has had regard to those recommendations and the reasons for them. As such, it cannot approve a charging schedule if the examiner has recommended rejection, but may approve a charging schedule if it incorporates modifications if and as required by the examiner. (Where a charging schedule is approved by a charging authority and it has made modifications to remedy any non-compliance with the drafting requirement identified by the examiner, it must publish a report setting out how the approved schedule remedies the non-compliance the examiner identified.)
A charging authority must publish the charging schedule on its website as soon as practicable after it has approved it and advertise it in the manner set out in the CIL Regulations, reg 25. A charging authority must approve a charging schedule at a meeting of the authority and by a majority of votes of members present. In the case of the Mayor of London, he must approve the charging schedule personally.
The CIL Regulations also make provision for correcting errors in an approved charging schedule. Only 'correctable errors' may be corrected and these are defined as follows:
errors which, corrected, will have no effect on the amount of CIL chargeable in respect of any given chargeable development; or
errors which would have the effect mentioned above but the correction is required in order to give effect to the modifications to the draft charging schedule recommended by the examiner.
The charging authority must correct the error either of its own volition or if requested to do so in writing by any person but it cannot do so after the end of six months from the date of approval of the schedule.
A charging schedule approved under PA 2008, s 213 cannot come into effect before the day after it is published.
A charging authority may charge a CIL in respect of development of land in its area. Development means anything done by way of or for the purpose of creating a new building or anything done to or in respect of an existing building. However, this excludes any such works done to buildings into which people do not normally go or buildings into which people only go intermittently for the purpose of inspecting or maintaining plant or machinery. It also excludes a change of use of a single dwelling house to use as two or more separate dwelling houses; and any work done to an existing building involving an increase to the gross floor space for which permission is only required because of a development order.
The amount of CIL payable, the 'chargeable amount', must be calculated by the collecting authority in accordance with the CIL Regulations, reg 40. The following points are of note in relation to the formulae:
The chargeable amount is the aggregate of the amounts of the CIL chargeable at each of the rates applicable at the time planning permission first permits the chargeable development in the area in which it will be built.
Below £50 a chargeable amount is deemed to be zero.
Any floor space (measured in gross internal area) of existing buildings which will form part of the completed chargeable development is deducted, as is any floor space of existing buildings which is demolished before completion of the chargeable development, from the net area calculated to be chargeable to the CIL. However, in both cases the existing buildings floor space and the demolished floor space must have been on the land and in lawful use on the date on which planning permission first permits the chargeable development. It will be considered to be in use if part of the building has been in use for a continuous period of at least six months within the period of 12 months ending on the day that planning permission first permits the chargeable development.
It is not entirely clear in the CIL Regulations as to whether the reference to being in use for at least six months of the 12 months prior to the permission that first permits the chargeable development means in actual physical occupation for the six months or in lawful use for the six months. However it seems likely to require both, and in any event it would prudent to assume so.
The CIL is subject to indexation, to the year in which the planning permission was granted.
A person can assume liability to pay the CIL in respect of a proposed development, before development commences and in accordance with any relevant procedural provisions contained in the CIL Regulations. Any person wishing to assume liability in relation to chargeable development must submit an assumption of liability notice to the collecting authority on a form published by the Secretary of State and liability is deemed to have been assumed on the date on which the notice is received. The collecting authority must send an acknowledgement of receipt. Assumption of liability cannot occur after the chargeable development has commenced except by transfer of assumed liability. Assumption of liability can be withdrawn any time before commencement of the chargeable development by giving notice.
Assumed liability may be transferred by submitting a liability transfer notice to the collecting authority on a Secretary of State's form, which must be received before the date on which the final payment of CIL is due in respect of the chargeable development. Liability is assumed to be transferred on the date on which the collecting authority receives the form.
Where no-one has assumed liability and the chargeable development is commenced in reliance on a planning permission, liability is apportioned between each material interest in the land. A 'material interest' is defined in the CIL Regulations as a freehold estate or a leasehold estate which has more than seven years left to run on the day after which planning permission first permits a chargeable development. Calculation of the apportioned CIL amount for which each material interest is liable must be carried out by the collecting authority in accordance with the CIL Regulations, reg 34, and the formula is based on the value of each material interest in relation to the aggregate values of all the relevant material interests.
An 'owner' for the purposes of the CIL Regulations is a person who owns a material interest and it is the owner who is liable to pay the amount of the CIL apportioned to his material interest in these circumstances. There are also provisions enabling a collecting authority to obtain information from an owner of a material interest in order to assist it in apportioning liability, through issue of an information notice.
The collecting authority may also decide to transfer a liability to pay the CIL to owners of land where it cannot recover the CIL from a person who has assumed liability, despite having made all reasonable efforts to do so.
Joint owners of an interest in land are each jointly and severally liable to the CIL, as are two or more persons who have assumed liability in respect of a chargeable development.
A person who assumes liability in accordance with the CIL Regulations, reg 31, is liable on commencement of the chargeable development to pay CIL equal to the chargeable amount less any relief granted.
'Chargeable development' is the development for which planning permission is granted subject to certain further provisions including the following:
In the case of outline permissions permitting implementation in phases, each phase is a separate chargeable development.
In the case of permissions granted under the Town and Country Planning Act 1990 ('TCPA 1990'), s 73 which amend a condition on an existing planning permission so as to extend the time within which development may be commenced, the chargeable development is the development which was permitted under the existing planning permission.
A planning permission is any of the following:
Full and outline planning permission including permissions granted under TCPA 1990, ss 73 (permission to development land without compliance with conditions previously attached) and 73A (permission for development already carried out).
Planning permissions granted by the Secretary of State under the above provisions as applied to him by TCPA 1990, ss 76A(10), 77(4) and 79(4).
A planning permission granted or modified on an appeal against an enforcement notice.
A planning permission modified under TCPA 1990, s 97 or 100.
A planning permission granted by an order under TCPA 1990, s 102 or 104.
A development consent order.
A general consent, where this means permissions granted by development orders, local development orders, simplified planning zone schemes, development with government authorisation or enterprise zone schemes and development authorised by an Act of Parliament. (General consents can therefore relate to development that benefits from permitted development rights and does not need express permission from a local planning authority.)
It does not include temporary planning permissions.
Development is commenced on the earliest date on which any material operation is carried out. 'Material operation' has the same meaning as in TCPA 1990, s 56(4).
This is subject to the following exceptions:
Development commences on the day planning permission is granted if a temporary planning permission had previously been granted for the same development.
Permission granted under TCPA 1990, s 73A (planning permission for development already carried out) or under a grant or modification of permission on an appeal against an enforcement notice, commences on the day planning permission for that development is granted or modified as the case may be.
The collecting authority must issue a 'liability notice' as soon as practicable after the date on which a planning permission first permits development.
Planning permission first permits development on the day that planning permission is granted but subject to the following:
In the case of outline planning permission, permission first permits development on the date of the final approval of the last reserved matter.
In the case of outline planning permissions which permit developments to be implemented in phases, planning permission first permits a phase of the development on the date of the final approval of the last reserved matter associated with that phase.
In the case of a full planning permission which is subject to conditions requiring further approvals to be obtained from the LPA before development can commence, planning permission is granted on the day final approval is given.
In the case of a general consent on the day on which the collecting authority receives a notice of chargeable development submitted to it in accordance with reg 64 or if no notice is submitted, on the date on which the last person is served with a notice of chargeable development in accordance with reg 64A(3).
Where planning permission is granted by way of a general consent, a notice of chargeable development must be submitted to the collecting authority setting out the land to which it relates, any buildings in use which are to be demolished before completion of the chargeable developments, any buildings in use which will be part of the chargeable development on completion and the development which is the subject of the notice. (A building is considered in use if part of that building has been in use for a continuous period of at least six months within a 12-month period ending on the day the notice is submitted.)
Where no notice has been submitted and the collecting authority considers development has commenced (and no relevant exemption applies), it must issue a notice on each owner of the relevant land and a liability notice.
The liability notice must be on a form published by the Secretary of State and must include a description of the chargeable development, the date on which it was issued and the chargeable amount. It must also state the amount of any charitable relief or relief for exceptional circumstances granted or, in the case of social housing relief, the particulars of each person benefiting from the relief and the amounts of relief each is getting.
The collecting authority must serve the liability notice on the following:
the relevant person ─ in the case of a general consent this is the person who has submitted a notice of chargeable development, in the case of planning permission granted subject to the condition requiring further approval, the person who applied for that approval and in all other cases the applicant for planning permission;
any person that has assumed liability to pay the CIL;
each owner of the relevant land.
A liability notices ceases to have effect once all outstanding amounts due have been paid. The chargeable amount payable is a local land charge but ceases to be one once all outstanding amounts have been paid.
When planning permission is granted for a chargeable development, a 'commencement notice' must be submitted to the collecting authority by the day on which the chargeable development commences. It must be submitted on a form published by the Secretary of State and must identify the liability notice issued in respect of the chargeable development, the intended commencement date and any other particulars specified on the form.
A person submitting a commencement notice must serve a copy of it on each person that is an owner of the relevant land. The collecting authority must send an acknowledgement of receipt to the person submitting it.
If a commencement notice is not submitted or the collecting authority believes that the chargeable development was commenced earlier than the intended commencement date set out on a commencement notice it has received, it must determine the day on which a chargeable development was commenced, the 'deemed commencement date'.
The collecting authority must then serve a 'demand notice' on each person liable for the CIL setting out various details including the amount payable by each person and the date on which it or instalments are due. The person served with a demand notice can request that the collecting authority make a declaration that he is not required to pay the amount of CIL for which he is liable until works are commenced on the land in which he has a material interest.
A charging authority that intends to allow the CIL to be payable in instalments must publish an instalment policy, setting out the number of instalments payments, the amount payable in any instalment, when instalments are due and any minimum amount of the CIL below which the CIL may not be paid in instalments. Where no instalment policies apply, the CIL is payable in full 60 days after the intended commencement date of the chargeable development. Where an amount payable is not paid by its due date and is outstanding, the CIL balance will fall due immediately.
Other circumstances in which the amount of the CIL is payable in full are as follows:
It is payable in full on the intended commencement date if nobody has assumed liability, and the collecting authority has received a commencement notice but has not determined a deemed commencement date for the chargeable development.
It is payable in full on the deemed commencement date where the collecting authority determines a deemed commencement date.
Any amount outstanding is due in full immediately where the collecting authority transfers liability to the owners.
A charging authority can accept 'land payments' to satisfy any CIL liability. A land payment is an acquisition of land from a person liable to pay the CIL on commencement of a chargeable development. The charging authority must aim to ensure that the acquired land is used to provide or facilitate the provision of infrastructure to support development in its area.
It cannot accept a land payment unless it is acquiring the land itself, the person from whom the land is being acquired has assumed liability to pay the CIL and an agreement to make the land payment is entered into before the chargeable development is commenced. The agreement must be in writing and set out the value of the land to be acquired and may not form part of their planning obligation under TCPA 1990, s 106. The value of the land must be determined by an independent person and is the price that it might reasonably be expected to obtain if sold on the open market on the date of valuation.
The CIL Regulations, regs 122 and 123 provide the legislative basis that is intended to establish the relationship between the CIL and s 106 agreements once the CIL is adopted in an area. However, similar restrictions will apply after 6 April 2014 for authorities that have not adopted the CIL.
Regulation 122 applies to decisions or determinations to grant planning permission for development and states that planning obligations or s 106 agreements can only constitute a reason for granting planning permission if an obligation meets the following tests:
necessary to make the development acceptable in planning terms;
directly related to the development; and
fairly and reasonably related in scale and kind to the development.
This codifies some of the tests originally set out in Circular 5/05 on Planning Obligations. DCLG guidance document entitled Community Infrastructure Levy: An Overview (May 2011) states the intention is to clarify the purpose of planning obligations in the light of the CIL and reinforce their purpose in seeking only essential contributions rather than more general contributions which are better suited to the CIL. The effect is therefore to render it unlawful to take a planning obligation into account when determining a planning application for development of the kind that could be subject to the CIL, if the obligation does not meet these tests.
Regulation 123 states that a planning obligation cannot be taken into account when determining a planning application for development capable of being charged the CIL, to the extent that it provides for funding or provision of infrastructure projects or of the type that a charging authority has published on its website as being infrastructure it intends to fund through the CIL. In the absence of such a list any infrastructure (as defined) may be funded by the CIL.
The intention with reg 123 is to prevent charging authorities from charging for infrastructure under both the CIL and in planning obligations. A charging authority can publish on its website a list of infrastructure it intends to fund through the CIL but if it does not publish a list, then the default assumption is that the authority is intending to use the CIL to fund any infrastructure capable of being funded by it; this means that an authority cannot then seek any s 106 contribution for this infrastructure, thereby encouraging authorities to publish a list. For shrewd charging authorities these lists are likely to be quite focused and short, in order to ensure that they can continue to have recourse to s 106 agreements on as wide a range of benefits and contributions as possible.
Regulation 123 also states that a planning obligation cannot be taken into account when determining an application where it provides for funding or provision of infrastructure capable of being subject to the CIL and where five or more planning obligations have been entered into on or after 6 April 2010 that also provide for funding or provision of the same project or type of infrastructure. This provision is intended to prevent pooling of s 106 contributions towards infrastructure capable of being funded by the CIL. For other items, such as affordable housing, that are not capable of being funded by the CIL, there is no limit on the numbers of obligations that may be pooled.
There is no liability to CIL if a gross internal area on a development comprising new buildings or enlargement of existing buildings is less than 100 square metres. However, this exemption does not apply where the development consists of dwellings.
The owner of a material interest in the relevant land is exempt from paying the CIL if it is a charitable institution and the chargeable development will be used for charitable purposes (and will be occupied or in the control of the charitable institution). In general terms, 'relevant land' is the land to which the planning permission relates. A similar exemption applies where a chargeable authority chooses to offer discretionary charitable relief to a charitable institution, where the whole or greater part of a chargeable development will be held as an investment from which the profits are applied for charitable purposes. If a charging authority wishes to make discretionary charitable relief available in its area, it must first publish a document stating that the relief is available and setting out its policy for giving relief in such circumstances.
These reliefs do not apply if the material interest is owned jointly with another person who is not a charitable institution or if the exemption from liability would constitute state aid. However if a charitable institution would normally be exempt on the basis that the chargeable development will be used for charitable purposes but for the fact that its exemption constitutes state aid, it can still be eligible for relief if discretionary charitable relief is available and the collecting authority is satisfied that the state aid is not notifiable.
In addition, discretionary relief may not be granted if the charitable institution intends to occupy the chargeable development and use it for trading activities, other than the sale of donated goods where the proceeds of sale are applied to the institution's charitable purposes.
In order to benefit from charitable relief, a claim must be submitted to the collecting authority in the manner specified. There are also provisions for 'claw back' where charitable relief is granted and circumstances change such that the eligibility requirements are no longer met after that relief is granted, and this occurs within a period of seven years from the date on which the chargeable development is commenced. If this occurs, the relief granted is withdrawn and the owner of the interest is then liable to pay CIL equal to the level of relief that has been withdrawn.
Chargeable development intended as social housing is eligible for relief from the CIL. To be eligible it must comprise 'qualifying dwellings' (in whole or in part) which are ones which satisfy at least one of the following conditions:
Condition 1 (relates to social rented accommodation) – dwellings let by a private registered provider of social housing, a registered social landlord or a local housing authority under any of the tenancies specified in reg 49.
Condition 2 (relates to low cost home ownership dwellings) – dwellings occupied according to statutory shared ownership arrangements, where the initial share in the dwelling must not exceed 75 per cent of the total value, the rent payable must be no more than three per cent of the unsold interest and the rise in annual rent must be limited to the rate of inflation plus 0.5 per cent.
The amount of relief is calculated according to formulae set out in reg 50. In order to obtain the relief, a claim must be submitted to the collecting authority by an owner of the relevant land who has assumed liability to pay the CIL in respect of the chargeable development. It must be submitted on the appropriate form and received before commencement of the chargeable development. A relief assessment must be submitted with the claim which identifies the qualifying dwellings, their gross internal area and the calculation of the qualifying amount, and this must be accompanied by evidence of compliance with the conditions set out above. The collecting authority must inform the claimant of its decision and give reasons. If relief is granted, a chargeable development can cease to be eligible if a commencement notice is not submitted before the chargeable development is commenced, or if the claimant withdraws or transfers its assumption of liability.
Relief attaching to a qualifying dwelling transfers whenever the land on which it is built or is to be built is sold prior to it being made available for occupation. The seller must notify and give details of the sale to the collecting authority so that the collecting authority can calculate the relief for the dwellings being transferred and transfer the relief to the new beneficiary, ie the new owner. It will also then calculate and issue a revised notice of relief to the beneficiary on the remainder of the chargeable development.
Social housing relief can be withdrawn when there is any change in circumstance that results in a qualifying dwelling ceasing to be a qualifying dwelling, and that happens within seven years from commencement of development. The amount of relief withdrawn must be paid by the beneficiary (and not an occupier). Sale of a qualifying dwelling does not constitute a disqualifying event if the proceeds of the sale are spent on another qualifying dwelling.
A charging authority may grant relief for exceptional circumstances from liability to pay the CIL if it appears to the authority that there are exceptional circumstances which justify doing so and that it considers it expedient to do. However it can only grant relief if it has made relief for exceptional circumstances available in its area; a s 106 agreement has been entered into in respect of the planning permission which connects the chargeable development and the charging authority considers that the cost of complying with s 106 is greater than the charge from the CIL payable; requiring payment of the charge would have an unacceptable impact on the economic viability of development; and granting relief would not constitute a notifiable state aid.
A charging authority which wishes to make exceptional circumstances relief available in its area must issue and publish a statement which gives notice that the relief is available and the date on which it will begin accepting claims for the relief.
A claim for relief must be submitted by an owner of material interest on the appropriate form and must be received by the charging authority before commencing the chargeable development. It must be accompanied by the following:
an independent assessment of the cost of complying with the planning obligation;
an independent assessment of the economic viability of the chargeable development;
an explanation of why payment of the chargeable amount would have an unacceptable impact on the economic viability; and
where there is more than one material interest in the land, an apportionment assessment.
The charging authority must make its decision on the claim as soon as practicable and inform the claimant in writing of its decision on the amount of relief granted.
In London, both the borough and the Mayor may charge the levy and therefore both are able to offer exceptional circumstances relief. Where the Mayor has decided to make it available on his CIL, although the claim must still be submitted to the borough, the borough must refer the claim and supporting documentation to the Mayor. Where both the borough and the Mayor have made relief available, the borough must first consider whether to offer the relief, and if so, how much. It then only refers the claim to the Mayor where the relief it proposes to give does not make acceptable the impact of the CIL on the economic viability of the development.
The chargeable development can cease to be eligible for exceptional circumstances relief if, before the chargeable development is commenced, charitable or social housing relief is granted, an owner of a material interest makes a material disposal of that interest, or the chargeable development is not commenced within 12 months from the date on which the charging authority issues its decision on the claim.
There are a number of provisions in the CIL Regulations permitting reviews and appeals to be made on a range of matters and issues.
An 'interested person' can request a review of the calculation of a chargeable amount provided it is made in writing to the collecting authority no later than 28 days after the liability notice stating the chargeable amount subject to the request for review was issued. Representations may be submitted with the review and the collecting authority must consider any such representations. Within 14 days of the date on which the collecting authority received a request for the review (the 'review start date'), the collecting authority must notify the person that requested the review of its decision and give reasons. The collecting authority can either confirm the original chargeable amount or calculate a revised amount.
A review of a decision cannot be requested once relevant development has been commenced. A request for a review also cannot be made if a claim for relief had been submitted to the charging authority and has not been withdrawn.
A person who has requested a review and is aggrieved at the decision on the review or is not notified of the decision within the requisite 14 days, may appeal to the 'appointed person' on the grounds that the revised chargeable amount or the original chargeable amount as the case may be has been calculated incorrectly. The appointed person is a valuation officer or district valuer. An appeal must be made within 60 days of the date of the liability notice which stated the original chargeable amount and only one appeal may be made. An appeal cannot be made if the relevant development has been commenced.
Any review or appeal will lapse if the relevant development is commenced before a decision has been given.
Where an appeal is allowed, the appointed person must calculate a revised chargeable amount.
'Interested persons' that can make a request for a review or an appeal are as follows:
the person who has assumed liability to pay the CIL;
in the case of a general consent, the person who submitted a notice of chargeable development;
in the case of planning permission granted subject to a condition requiring further approval to be obtained before commencing development, the person who has applied for that approval;
the person who applied for planning permission; and
a person who has been served with a notice of chargeable development in accordance with reg 64A.
The CIL Regulations also provide for appeals to be made in relation to the following matters:
Apportionment of liability – a person who disagrees with the decision of the collecting authority on the apportionment of liability with respect to an owner's material interest in land may appeal.
An interested person who disagrees with the decision of the collecting authority to grant charitable relief may appeal on the ground that it incorrectly determined the value of the interest in the land in respect of which the claim was allowed.
A person who is aggrieved at the decision of the collecting authority to impose a surcharge may appeal on a number of grounds as set out in the relevant regulation.
A person on whom a demand notice is served which states a deemed commencement date may appeal on the ground that the collecting authority has incorrectly determined that date.
A person who is aggrieved at a decision of a collecting authority to impose a CIL stop notice may appeal on the basis that the collecting authority did not send a warning notice before imposing the CIL stop notice or that the chargeable development in respect of which the CIL stop notice was imposed has not commenced.
There are various procedural requirements that must be complied with in relation to making appeals.
In December 2010, the Government invited all English local authorities to apply to become part of the CIL front runners project, aimed at supporting local authorities to develop the best approach to implementation in their area. Eight authorities were accepted and, of these, three have so far adopted charging schedules. Newark and Sherwood District Council adopted their schedule on 1 December 2011, and Shropshire Council and the London Borough of Redbridge adopted their charging schedules on 1 January 2012.
The Mayor of London's draft charging schedule underwent examination in 2011 and on 27 January 2012 the independent examiner's report was received recommending that his charging schedule be approved. The Mayor's CIL came into effect on 1 April 2012. It is charged on most developments in London at the following rates:
Zone 1 Boroughs at £50 per square metre: Camden, City of London, City of Westminster, Hammersmith & Fulham, Islington, Kensington & Chelsea, Richmond upon Thames, Wandsworth;
Zone 2 Boroughs at £35 per square metre: Barnet, Brent, Bromley, Ealing, Greenwich, Hackney, Haringey, Harrow, Hillingdon, Hounslow, Kingston upon Thames, Lambeth, Lewisham, Merton, Redbridge, Southwark, Tower Hamlets;
Zone 3 Boroughs at £20 per square metre: Barking & Dagenham, Bexley, Croydon, Enfield, Havering, Newham, Sutton, Waltham Forest.
Development used wholly or mainly for the provision of medical health services or for the provision of education as a school or college or else as an institution of higher education is subject to nil rates. The Mayor does not provide any exceptional circumstances relief.
 Localism Act 2011, s 114 came into force on 16 November 2011 and s 115 came into force on 15 January 2012.
 DCLG (October 2011) Community Infrastructure Levy: Detailed Proposals and Draft Regulations for Reform Consultation (available at http://www.communities.gov.uk/publications/planningandbuilding/cilreformconsultation [accessed March 2012]).
 Planning Act 2008, s 206.
 Planning Act 2008, s 216.
 Community Infrastructure Levy Regulations 2010 (SI 2010/948), reg 59.
 Planning Act 2008, s 211(1).
 Community Infrastructure Levy Regulations 2010 (SI 2010/948), reg 14.
 Community Infrastructure Levy Regulations 2010 (SI 2010/948), reg 61.
 Community Infrastructure Levy Regulations 2010 (SI 2010/948), reg 14.
 Community Infrastructure Levy Regulations 2010 (SI 2010/948), reg 12.
 Community Infrastructure Levy Regulations 2010 (SI 2010/948), reg 13.
 Community Infrastructure Levy Regulations 2010 (SI 2010/948), reg 15.
 Community Infrastructure Levy Regulations 2010 (SI 2010/948), reg 16.
 Planning Act 2008, s 212.
 Community Infrastructure Levy Regulations 2010 (SI 2010/948), reg 17.
 Planning Act 2008, s 212A.
 Community Infrastructure Levy Regulations 2010 (SI 2010/948), regs 20 and 21.
 Community Infrastructure Levy Regulations 2010 (SI 2010/948), reg 22.
 Community Infrastructure Levy Regulations 2010 (SI 2010/948), reg 24.
 Planning Act 2008, s 213.
 Community Infrastructure Levy Regulations 2010 (SI 2010/948), reg 26.
 Community Infrastructure Levy Regulations 2010 (SI 2010/948), reg 28.
 Planning Act 2008, s 206.
 Planning Act 2008, s 209.
 Community Infrastructure Levy Regulations 2010 (SI 2010/948), reg 6.
 Planning Act 2008, s 208.
 Community Infrastructure Levy Regulations 2010 (SI 2010/948), reg 31.
 Community Infrastructure Levy Regulations 2010 (SI 2010/948), reg 32.
 Community Infrastructure Levy Regulations 2010 (SI 2010/948), reg 33.
 Community Infrastructure Levy Regulations 2010 (SI 2010/948), reg 4.
 Community Infrastructure Levy Regulations 2010 (SI 2010/948), reg 4.
 Community Infrastructure Levy Regulations 2010 (SI 2010/948), reg 35.
 Community Infrastructure Levy Regulations 2010 (SI 2010/948), reg 36.
 Community Infrastructure Levy Regulations 2010 (SI 2010/948), reg 31.
 Community Infrastructure Levy Regulations 2010 (SI 2010/948), reg 9.
 Community Infrastructure Levy Regulations 2010 (SI 2010/948), reg 5.
 'Material operation' means the construction works in relation to the erection of a building, demolition, digging of a trench for foundations, laying of any underground main or pipe to the foundations, any operation in the course of laying out or constructing a road or part of a road and any change in the use of any land which constitutes material development.
 Community Infrastructure Levy Regulations 2010 (SI 2010/948), reg 8.
 Community Infrastructure Levy Regulations 2010 (SI 2010/948), reg 64.
 Community Infrastructure Levy Regulations 2010 (SI 2010/948), reg 64A.
 Community Infrastructure Levy Regulations 2010 (SI 2010/948), reg 65.
 Community Infrastructure Levy Regulations 2010 (SI 2010/948), reg 66.
 Community Infrastructure Levy Regulations 2010 (SI 2010/948), reg 67.
 Community Infrastructure Levy Regulations 2010 (SI 2010/948), reg 68.
 Community Infrastructure Levy Regulations 2010 (SI 2010/948), reg 69.
 Community Infrastructure Levy Regulations 2010 (SI 2010/948), reg 69A.
 Community Infrastructure Levy Regulations 2010 (SI 2010/948), reg 69B.
 Community Infrastructure Levy Regulations 2010 (SI 2010/948), reg 70.
 Community Infrastructure Levy Regulations 2010 (SI 2010/948), reg 71.
 Community Infrastructure Levy Regulations 2010 (SI 2010/948), reg 43.
 Community Infrastructure Levy Regulations 2010 (SI 2010/948), reg 44.
 Community Infrastructure Levy Regulations 2010 (SI 2010/948), reg 46.
 Community Infrastructure Levy Regulations 2010 (SI 2010/948), reg 47.
 Community Infrastructure Levy Regulations 2010 (SI 2010/948), reg 48.
 Community Infrastructure Levy Regulations 2010 (SI 2010/948), reg 51.
 Community Infrastructure Levy Regulations 2010 (SI 2010/948), Pt 10.
 Community Infrastructure Levy Regulations 2010 (SI 2010/948), reg 113.
 Community Infrastructure Levy Regulations 2010 (SI 2010/948), reg 114.
 Community Infrastructure Levy Regulations 2010 (SI 2010/948), reg 115.
 Community Infrastructure Levy Regulations 2010 (SI 2010/948), reg 116.
 Community Infrastructure Levy Regulations 2010 (SI 2010/948), reg 117.
 Community Infrastructure Levy Regulations 2010 (SI 2010/948), reg 118.
 Community Infrastructure Levy Regulations 2010 (SI 2010/948), reg 119.
 Community Infrastructure Levy Regulations 2010 (SI 2010/948), reg 120.