Draft Development Contributions SPD - September 2022

(17)1 INTRODUCTION

1.1 Overview

1.1.1 North Hertfordshire Council (NHC) is committed to ensuring that the necessary infrastructure, services and facilities are provided to support growth and development in the District.

1.1.2 This Supplementary Planning Document (SPD) sets out detailed guidance on the type and scale of developer contributions that will be sought to support new development in our area.

1.1.3 The aim of the document is to assist Council Officers, applicants, agents and Members through the planning application process in a fair, transparent and consistent way.

1.2 Background and status of the SPD

1.2.1 This document has been produced by North Hertfordshire Council to provide further information on requirements set out in our next Local Plan. In particular, it expands upon proposed Local Plan Policy SP7: Infrastructure Requirements and Developer Contributions.

1.2.2 This draft SPD has been widely consulted upon, including with developers and members of the public.

1.2.3 This SPD is a material consideration when determining planning applications in the District and will be used when securing obligations, whether by Section 106 agreements or unilateral undertakings.

1.3 Legislative context

1.3.1 SPDs are documents which add further details to policies in a Local Plan. They can be used to provide further guidance on particular issues, but they cannot introduce new policies. SPDs are a form of Local Development Document produced under the 2004 Planning and Compulsory Purchase Act (as amended). Government regulations set out the requirements for producing SPDs^[1].

1.3.2 Section 106 of the Town and Country Planning Act 1990 allows local planning authorities to enter into agreements with persons with an interest in land. These agreements can be used (but are not necessarily limited) to:

• Restrict the development or use of the land;
• Require (parts of) the land to be used in a specific way;
• Require the payment of a sum to the local authority.

1.3.3 The Community Infrastructure Levy Regulations 2010 (as amended) set out the requirements that planning obligations must fulfil. Planning obligations can only be used:

• To make the development acceptable in planning terms
• Where they are directly related to the development; and
• Are fairly and reasonably related in scale and kind to the development.

1.3.4 Paragraph: 4, reference ID: 23b-004-20190901 of the National Planning Practice Guidance makes clear that it is not appropriate for plan-makers to set out new formulaic approaches to planning obligations in supplementary planning documents or supporting evidence base documents, as these would not be subject to examination. Whether or not an obligation meets the test of fairly and reasonably related in scale and kind to the development will be assessed on a case by case basis considering the project, harm or stress added to such facilities (in the round) from the development proposed, and considering the residual S106 figures arising from the viability evidence supporting the Local Plan^[2].

1.3.5 The pooling limits previously imposed by regulation 123 of the above Regulations have been omitted by way of regulation 11 of The Community Infrastructure Levy (Amendment) (England) (No. 2) Regulations 2019. This omission now allows more than five obligations to fund a single infrastructure project where the contribution meets the three tests set out in paragraph 1.3.3 of this document.

1.4 National policy context

1.4.1 The National Planning Policy Framework (NPPF) says that Local Plans should set out the contributions expected from development. This should include the levels and types of affordable housing and other infrastructure requirements. These policies should not undermine the deliverability of the plan.^[3]

1.4.2 Local Planning authorities should consider whether otherwise unacceptable development can be made acceptable through the use of conditions or planning obligations. Planning obligations should only be used where it is not possible to address unacceptable impacts through a planning condition^[4].

1.4.3 Where up-to-date policies set out the contributions expected from development, planning applications that comply with them should be assumed to be viable^[5].

1.4.4 The Government sets out requirements for considering viability in the National Planning Policy Framework and in associated National Planning Practice Guidance. Local plans should clearly set out the contributions that developers are expected to make towards infrastructure and affordable housing; there should be a standard approach to establishing land value; transparency and accountability through the publication of viability assessments and through improvements to the monitoring and reporting of Section 106 planning obligations^[6].

1.5 The Local Plan and Neighbourhood Plans

1.5.1 The North Hertfordshire Local Plan was submitted to the Secretary of State in June 2017 for Examination in Public and the Council is currently awaiting the final Inspector's report.

1.5.2 Emerging policy SP7 of the Local Plan provides the main policy 'hook' for this SPD while other Local Plan policies have further requirements for developer contributions. This emerging Policy, including proposed modifications, to date is shown below.

1.5.3 This document has been structured to broadly follow the chapters and topics set out in the emerging Plan.

1.5.4 Developer contributions may also be required by policies set out in Neighbourhood Plans and applicants should have regard to such policies when formulating development proposals.

1.6 Developer contributions, planning obligations, S106 and Community Infrastructure Levy (CIL)

1.6.1 Developer contributions are normally secured through planning obligation agreements under Section 106 of the Town and Country Planning Act 1990.

1.6.2 The terms 'developer contributions', 'planning obligations' and 'Section 106' (s106) are used interchangeably but generally refer to the same things. Agreements may be used to ensure that the impacts arising as a result of a new development can be addressed. They are also a valuable way of ensuring that a development complies with planning policies contained in the Local Plan and any Neighbourhood Plans.

1.6.3 Planning obligations may be set out in a Section 106 agreement between the Council and the developer (and any other relevant parties) or in a unilateral undertaking offered by the developer. Section 106 agreements and unilateral undertakings are individual, scheme-specific, legal documents. Such agreements or undertakings can contain a number of planning covenants which can relate to both financial and non-financial obligations.

1.6.4 The Government has set out the intention to introduce a new Infrastructure Levy (IL) in the Levelling-up and Regeneration Bill. The IL would be charged on the value of the property when it is sold and applied above a minimum threshold, with levy rates and minimum thresholds set by local authorities. A consultation on the IL is expected in the coming months. We do not yet know the precise nature of, or timetable for, any IL and the information to date suggests that site-specific obligations will continue to have some role. It is likely that elements of this document and the guidance contained within will remain a material planning consideration in the assessment of future development management applications if an IL is subsequently introduced.

1.7 Sustainability Appraisal

1.7.1 This draft SPD has been reviewed against the Environmental Assessment of Plans and Programmes Regulations 2004 (commonly referred to as the 'Strategic Environmental Assessment Regulations). This scoping exercise has shown that this draft SPD does not require an SEA to be undertaken. To the extent that applies, this document shall be reviewed against any replacement legislation related to Brexit arrangements^[7].

1.8 Cross-boundary issues

1.8.1 There may be instances where the impacts of development that lie within other local authority areas may affect areas within the District. When notified of developments that could potentially affect the delivery of services by North Hertfordshire Council, the authority will discuss these with the relevant local authority and seek obligations from the developer accordingly. In these cases, the Council would expect a clause enabling money to be transferred for spending in the District if necessary.

1.8.2 The Council will make reciprocal arrangements to those set out above should a development falling within the North Hertfordshire administrative boundary have cross-boundary impacts affecting another authority area(s).

1.8.3 The above approaches will also apply, having regard to the general principles in this document, in relation to any Nationally Significant Infrastructure projects (NSIPs) in or affecting the District.

1.9 Other providers that may seek S106 contributions

1.9.1 A range of infrastructure providers may seek contributions from new development. This includes, but is not limited to, Hertfordshire County Council, the NHS, the Police and Crime Commissioner for Hertfordshire and local Parish, Town or Community Councils. These are indicated under the relevant topic areas below. Guidance should also be taken from programmes from these other authorities, such as Hertfordshire County Council Developer Infrastructure Contributions document, or neighbourhood development plans from local Councils.

1.9.2 Hertfordshire County Council will normally be signatories where contributions are required for services they provide. Other providers may also be required to be signatories to the s106 agreement. The decision to make any other provider a signatory will be based on the level of financial contribution sought by the other provider.

1.9.3 Any provider (other than North Hertfordshire Council, Hertfordshire County Council and any Parish or Town Council) seeking a financial contribution in excess of £250,000 will, on a case-by-case basis, be requested to be a third party signatory to the Section 106 agreement. This threshold has been set as holding funds in excess of this figure for third parties or transferring monies without adequate safeguards represents an unacceptable financial and audit risk for North Hertfordshire Council.

1.10 Infrastructure Planning and Funding

1.10.1 An Infrastructure Delivery Plan (IDP)^[8] is part of the Local Plan evidence base and sets out the requirements for infrastructure over the plan period. The IDP will need to be updated regularly to take into account the infrastructure needs of the District, including any updating of costs that is required.

1.10.2 The IDP examines the supply and demand for infrastructure based on forecasts of population growth.

1.10.3 Individual Council departments have priority projects that are set out in relevant strategies and action plans. These are identified under specific topics elsewhere in this SPD. Applicants should also have regard to other plans and strategies prepared by other service providers.

1.10.4 In addition to updating the IDP, Annual Infrastructure Funding Statements are a requirement of Regulation 121A of the Community Infrastructure Levy Regulations 2010 as amended by Regulation 9 of the Community Infrastructure Levy (Amendment) (England) (No. 2) Regulations 2019.

1.11 Strategic sites and masterplanning

1.11.1 Policy SP9 of the new Local Plan requires the masterplanning of strategic and significant development sites, generally defined as developments of 100 or more homes. The Council has published detailed guidance on the masterplanning process and the expected contents of masterplans^[9]. This includes an Infrastructure Delivery Plan allowing for early identification of strategic infrastructure requirements.

1.11.2 The Local Plan identifies six Strategic Sites, for which there are detailed policies. For these sites a strategic masterplan should be provided for the whole allocation to ensure that infrastructure provision fully meets the demands arising from development. The Strategic Sites are:

• Policy SP14: Site BA1 – North of Baldock
• Policy SP15: Site LG1 – North of Letchworth Garden City
• Policy SP16: Site NS1 - North of Stevenage
• Policy SP17: Site HT1 - Highover Farm, Hitchin
• Policy SP18: Site GA2 - Land off Mendip Way, Great Ashby
• Policy SP19: Sites EL1, EL2 & EL3 East of Luton

1.11.3 The Strategic Sites will need to address any specific contribution requirements set out in their individual policies, other relevant policies in the Plan and in this document. Developers should be aware that non-financial obligations may be required to secure details outside of the scope of this document, such as securing a masterplan, the final location and use splits of local neighbourhood centres, or management plans for the maintenance and sustainability of any new neighbourhood centres required as a result of the development.

1.11.4 For sites of between 100 and 500 homes (or as otherwise captured by Policy SP9), the Council's masterplanning requirements will be applied in a proportionate manner having regard to the nature of the scheme proposed and the key issues.

1.11.5 The Council encourages the production of masterplans prior to the submission of a planning application. s106 discussions will not normally take place at this stage. However, it is anticipated that the masterplan process will normally 'dovetail' into a bespoke pre-application and / or a planning application where more detailed information may be sought or provided in line with this SPD.

1.12 Nationally Significant Infrastructure Projects (NSIPs)

1.12.1 Since the production of the Local Plan, work to expand Luton Airport has commenced. The Council has been involved in ongoing engagement regarding this project. The project has been registered with the National Infrastructure Commission and a Development Consent Order application is anticipated in 2023. The expansion of Luton Airport and any further NSIPs will be dealt with by the Planning Inspectorate, as set out in the Planning Act 2008.

1.12.2 The Council may seek appropriate contributions from any part of any NSIP in or affecting the District in line with the advice and principles in this document.