Planning Obligation - A Guide to Section 106 and Developer Contributions

2. Southend Borough Council’s Approach to Planning Obligations

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How Planning Obligations will be applied Across Southend

(4) 2.1 The Council will normally require a planning obligation where it is felt that a proposed development of whatever nature or scale, will in itself or cumulatively give rise to unacceptable pressure on public infrastructure or where the development is of such a nature or scale that it is considered that it should contribute to the supply of affordable housing in the Borough. The Council may also seek an obligation in pursuit of adopted policy, such as the provision of public art, which seeks to provide for quality natural and built environments and sustainable communities. In all instances, planning obligations will only be sought where they satisfy the tests of Circular 05/2005 as set out in Section 1 paragraph 1.5.

(4) 2.2 The precise scale and scope of a planning obligation will be determined, by negotiation, in relation to the specific circumstances of the development, including viability. In terms of priorities for planning obligations, the Council must first seek to mitigate the direct impacts of the development (e.g. highways restoration adjacent to development), and secondly ensure that development complies with the policy requirements set out in national planning policy, the East of England Plan 2008, Core Strategy DPD 2007 and Borough Local Plan 1994 (e.g. affordable housing /public art). Thirdly, the Council will seek obligations that are relevant on a site-specific basis (e.g. wider public realm improvements and CCTV).

(1) 2.3 Southend Borough Council has decided on an approach that identifies the impacts of the development and sets these against its priorities for planning obligations, based on its knowledge of the locality and community. Whilst the Council does not seek to apply a blanket approach, it is necessary to have a consistent and transparent approach so that applicants can be aware early on in the development process what the Council's expectations might be. At all times Southend Borough Council will seek to ensure that the benefit sought is reasonable in scale and kind to the specific development proposal and meets the tests set out in Circular 05/2005.

(2) 2.4 Commercial developments bring employment and economic benefit but there is a need to integrate such developments into the local community and environment, hence planning obligations may be sought to achieve this. Both employees and other users require effective transport provision and a safe and functional environment. This may be achieved by improvements to the highway (including cycle paths and public footpaths) and the wider public realm. The increased workforce may also place increased demands on services such as libraries, health centres, leisure and recreational facilities.

2.5 Similarly, entertainment uses such as bars, restaurants, nightclubs and cinemas attract tourists, shoppers and after work patronage which needs to be balanced with Southend’s residential communities. Many of these activities also operate late into the evening and so issues of safety, provision of transport, night time noise, litter and street fouling arise. These activities need to be managed in order to maintain the local character that people find attractive as well as protecting the amenity of residents and other business users.

(1) 2.6 In respect of new housing, such developments bring new residents who will use existing facilities and create a demand for additional ones, hence planning obligations may be sought to address this. Education and training, health facilities, arts and culture, open space and leisure demands will arise. Therefore, community facilities are also likely to be required in support of residential schemes where there is a demonstrable need for this supporting infrastructure.

2.7 For residential schemes, the Council seeks the provision of affordable housing from the threshold of 10 or more residential units or 0.3 hectares as set out in Core Strategy Policy CP8 ‘Dwelling Provision’. The policy generally requires 20-30% of the proposed units to be affordable depending on the scale of the development, or a financial contribution to be made where on-site provision is either not feasible or not practicable.

2.8 Planning obligation requirements may be applied more flexibly to applications for community, voluntary sector or education facilities. For example, such a development may be fulfilling Southend Borough Council’s key policy priorities for a location such as provision of a local health care facility, an educational, leisure or cultural facility (e.g. pocket park, community theatre or arts centre). Planning obligations will also not normally apply to householder applications or small-scale commercial development (under the 1000m² threshold), which should have limited impact or be sustainable in their own right.

(1) 2.9 The Council acknowledges that in certain circumstances the costs associated with a development may be such that all the issues which ideally should be included within a planning obligation cannot be addressed without the scheme becoming unviable.

2.10 If a developer considers that the Council is placing unreasonable obligations upon a development scheme, the Council will require a developer to adopt an ‘open book’ approach, whereby relevant development finances are shared with Council officers and/or an appropriate assessor carrying out an independent financial appraisal, in order to provide appropriate and necessary information to support such a claim. The Council will employ confidentiality and discretion with any evidence provided, and this will only be utilised to address and evaluate a specific claim in relation to viability.

2.11 If the Council agrees that a development cannot reasonably afford to meet all of the Council’s specified requirements, these requirements will then be prioritised by the Council in negotiation with the developer, subject to the proposal being acceptable in all other respects. While commercially sensitive information and detailed figures will be treated in confidence, it may be necessary to report the key issues and broad conclusions in reports to elected members at the time of their consideration of a planning application.

2.12 In assessing the precise nature of on-site and off-site planning obligations to be required on individual sites, the Council will take into account the impact of the proposal, the economics of provision, and any abnormal development and infrastructure costs. Proposals may be considered unviable owing to unforeseen and abnormal costs associated with the development, which may include the costs of identification and remediation of contamination or noise, major service diversions, or other specific exceptional planning requirements. The Council does expect that factors such as contaminated land will have been reflected in the site value (i.e. purchase price of the land) and should not therefore affect a developer’s ability to meet planning obligations. However, consistent with the advice relating to pre-application discussions, the Council will be seeking to agree draft heads of terms prior to submission of an application and any likely difficulties should be brought to the attention of the Council at this pre-application stage. This will avoid delays to the planning application process and will also avoid planning applications being refused on the basis of non-compliance with planning obligation requirements.

(1) 2.13 Circular 05/2005 recommends the use of independent third parties where there are any difficulties in reaching agreement in negotiations. The actions of mediators may help to reduce the cost and length of negotiations if disputes over obligations are occurring. The associated "Planning Obligations: Practice Guidance" (DCLG 2006) provides detailed information on the use of independent third parties. If issues of viability arise and there is a need for the Council to obtain independent valuation and financial advice, it will be expected that the costs from this would be met by the developer who is objecting to one or more obligations.

Southend Borough Council’s Priorities for Planning Obligations

(8) 2.14 Southend Borough Council recognises the need to achieve positive planning for sustainable communities within the Borough. The Council has therefore categorised the planning obligations, which it considers need to be sought from and addressed by new development to achieve this, as ‘Sustainable Communities Criteria’. Developers will be invited to enter into planning obligations with the Council through Sustainable Communities Criteria within the following categories:

• Transport, Highways and Accessibility
• Education, Training and Skills
• Community Facilities,
• Public Art and the Public Realm (including the Historic Environment)
• Natural Environment and Conservation
• Affordable Housing
• Flood Risk, Waste and Resources
• Administration and Monitoring of Planning Obligations

(1) 2.15 The Sustainable Communities Criteria cover a range of infrastructure, services and facilities and other requirements, which should be considered in the determination of planning applications to ensure sustainable development within the Borough and the creation of sustainable communities. All Sustainable Communities Criteria reflect the objectives, needs and requirements of Council strategies including those for planning, transport, housing, recreation and education. The Criteria also take into consideration the policies and aims contained in national, regional and local planning policy.

2.16 The Sustainable Communities Criteria are not set out in priority order and details of the planning obligations likely to be sought are not exhaustive. Other obligations not contained within the Criteria may be sought to ensure the delivery of key policy and sustainable regeneration objectives depending upon the individual characteristics of a development proposal, as well as other requirements which may arise from specific circumstances. Similarly any thresholds and calculations, which may be applied once adopted, are not rigid and may be updated as and when it is deemed necessary.

Transport, Highways and Accessibility

2.17 It is recognised that new development may give rise to the need for different types of transport/highways improvements and it is important that they are clearly distinguished.

2.18 Some development schemes will require specific works and improvements which will be needed to mitigate direct impacts to the transport network to make the proposed development acceptable in planning terms. Mitigating measures may include improvements to junctions, slip roads, provision of traffic lights and pedestrian or toucan crossings, local traffic calming or the introduction of parking management schemes on surrounding streets. 

(4) 2.19 Developers may also be expected, to provide other measures such as on site estate roads, footpaths, bridleways and cycle ways, parking spaces (for cars, motorcycles and bicycles), lighting and bus stops/lay-bys which are adequately connected to the existing highway network. In addition, contributions towards the sustainable transport infrastructure including public transport, walking and cycle routes may be requested if the impact of a development necessitates. Contributions from a number of developments may need to be ‘pooled’ in order to cost effectively and appropriately implement certain transport improvements and measures.

(4) 2.20 The Council proposes the following Sustainable Communities Criteria as essential to achieving the above aims and objectives:

• To provide safe access to a site during the construction phase and once development has been completed including access for the disabled
• To include parking provision and ‘servicing’ facilities in line with adopted or emerging vehicle parking standards contained herein
• To contribute to parking management schemes and local parking conditions
• To accommodate safely and sustainably local and strategic increases in traffic numbers arising from a development
• To help discourage additional traffic from using unsuitable local highways and roads, in accordance with the Southend Route Hierarchy and ‘Environmental Rooms’ policy
• To provide works, services and facilities to secure improved sustainable transport and accessibility – by public transport, walking and cycling including access for the disabled
• To contribute to providing safe, adequate and sustainable access to all nearby community facilities, including parks, open spaces and schools
• To provide adequate access and facilities for managing waste
• To contribute to Road Safety Schemes
• To contribute to any Park and Ride Schemes
• To contribute financially towards the measures which address incremental growth of car traffic and congestion solution

Education, Training and Skills

2.21 Most new development will lead to an increase in demand for school places or will place pressure on these services leading to a need for either new accommodation or refurbishment and improvement of existing educational facilities. The Council has a duty to ensure that there are sufficient school places in the local authority area to meet present and future demand for places. The Council are mindful of the impact new development may have on the level of education provision in the area and the cumulative effect on the Borough. In the majority of cases, the planning obligation sought is a financial contribution towards educational provision. This is to help address the impact of new housing on local schools and other educational facilities. Within this remit the Council will also seek contributions towards the potential cumulative impact of smaller developments on local facilities in order to secure mitigation of any development proposal on the education system.

2.22 The Council is committed to achieving the economic, social and environmental well being of all residents so as to ensure that a better quality of life and prosperity is shared by all. To achieve this, the Council proposes that in appropriate circumstances contributions should be made by developers towards the training and skills base needed to achieve the jobs led growth and regeneration.

2.23 The Council proposes the following Sustainable Communities Criteria as essential to achieving the above aims and objectives:

• To ensure adequate provision and condition of Primary, Secondary and post 16 schooling facilities
• To contribute to the provision of Nursery and child care facilities
• To contribute to local skills and training provision, including improved access to local jobs and recruitment

Community Facilities including ‘Open space, sport and recreation’ and ‘Health, social care and physical community needs’

(1) 2.24 A key priority for the Thames Gateway is to create places where people want to live and work, as well as delivering sustainable communities. Southend is a compact densely developed urban area, which presently has heavy demands placed upon its infrastructure. Community and cultural facilities, therefore, have an essential role to play in ensuring that a balanced and quality environment is created. The quality and quantity of fundamental services need to be maintained and improved, while simultaneously achieving the regeneration objectives for the town, to ensure that the quality of life of individuals is maintained and improved.

2.25 The town’s existing facilities will need protecting and enhancing according to the level of additional housing and commercial development and the pressures that these place on them. Any further growth within the Borough must not only safeguard the existing community infrastructure but seek to enhance the infrastructure balance. Improvements to and/or re-provision of community infrastructure, delivered through planning obligations, must therefore accompany development or act as a pre condition to it.

(3) 2.26 The Council proposes the following Sustainable Communities Criteria as essential to achieving the above aims and objectives:

• Provision, enhancement and maintenance of on and/or off site open space both formal and informal and recreation space (including public parks, beach and foreshore areas etc.)
• Provision of or improvements to built sports facilities, playing fields and other outdoor sports facilities as well as other recreation facilities in major developments
• Adequate provision of all health facilities for local community needs
• Adequate provision of extra care housing and supported accommodation units for older people, those with learning disabilities, those with mental health problems and for family centres and children’s services
• Provision and/or improvements to other community facilities that fall into Use Class D1, D2 or sui generis (e.g. theatres, swimming pools, community centres etc.) or that contribute to the quality of the public realm (e.g. public toilets)

Public Art and the Public Realm (including the Historic Environment)

(2) 2.27 The quality of the built environment affects the way in which people perceive and enjoy places and spaces. Well designed, accessible and legible urban places and spaces will help promote and support greatly the creation of cohesive, pleasant and sustainable local communities. An environment and its surroundings, whether natural or built, will play a significant role in shaping the quality of life experienced by a population. Interesting and innovative buildings, quality streets, good relationships between new and existing development, the use of public art and soft and hard landscaping can all help to develop local identity, create places which people are proud of, and thereby, improve their quality of life and a sense of belonging. Accordingly, there is a need for greater emphasis on the use of buildings, streets, open spaces and landscaping – the public realm – and an understanding of how these elements relate to each other to create a unique ‘sense of place’ and identity. Indeed the public realm, comprising both ‘physical’ and ‘social’ elements, has a significant role to play in creating a quality environment, as it encapsulates the spaces and settings which facilitate and support social interaction and public life.

(3) 2.28 Consistent with the objectives of the adopted Design and Townscape Guide SPD, the Council proposes the following Sustainable Communities Criteria outlined as essential to achieving the above aims and objectives:

• To apply good quality, sound & sustainable design in all new developments which positively contributes to the character and appeal of the immediate and surrounding area
• To ensure that any new development provides a significant contribution to the existing and emerging townscape being established within the town, and enhances the public realm through high quality hard and soft landscaping and the application of urban design principles in accordance with Council policies and guidance
• To provide on site, where appropriate, or contribute towards "public art" which will help broaden and reinforce Southend as the "cultural capital" of the Essex Thames Gateway
• To contribute to the maintenance and enhancement of the public realm
• To contribute to the conservation, restoration and enhancement of the historic environment and archaeological sites and monuments
• To ensure that all new developments contribute to personal and public safety by "Designing Out Crime" and being "Secured by Design"
• Provision towards Information Communication Technology (ICT) within developments
• Provision of CCTV cameras within the vicinity of a development where appropriate
• Provision of additional approved street lighting if required within the vicinity of a development

Natural Environment and Conservation

2.29 The cumulative effect of new development has and will impact greatly upon the physical and natural environment. Even though many developments are relatively small scale, their accumulation results in major effects on the overall natural systems of neighbourhoods, towns, cities, regions and, eventually, on the earth’s biosphere. Given serious concerns in relation to global climate change, pollution of the natural environment, and the depletion of fossil fuel sources, the need for environmental responsibility is an important consideration for those involved and associated with development. Development will need to have regard to environmental impacts as well as social impacts and long term economic viability to contribute towards the creation of truly sustainable communities and lasting environments.

2.30 In view of future development demands and pressures within the Borough, the Council will ensure that development contributes towards the provision of additional public open spaces, biodiversity and nature conservation areas, especially in circumstances where existing amenities would be impacted upon by development. It will also be necessary for developments to contribute towards enhancement, retention and management of these areas, in order to meet national, regional and local objectives and to offset any additional pressures and demands.

(4) 2.31 The Council proposes the following Sustainable Communities Criteria as essential to achieving the above aims and objectives:

• To offset/compensate/mitigate for the loss of/impact on any natural or environmental resource, for example, woodland, grassland, open water, hedgerows, allotments etc. which were in existence prior to development
• To preserve, maintain and enhance natural habitats and mitigate/compensate against loss of or damage to species or habitats which contribute to local biodiversity,
• To preserve, maintain and enhance public open space\green space wherever it contributes to Thames Gateway "Green Grid" Strategy or any other strategic open/green space documents which have been agreed by the Council
• To replenish/replace trees, vegetation or areas lost to/affected by development, through re-planting of suitable/appropriate species and by landscaping new and additional areas
• To include suitable measures for preserving, maintaining and enhancing species or habitats through management agreements where these species or habitats may be accommodated within the footprint of the development scheme
• To replace any areas of green/open space lost to parking facilities or service roads
• To contribute to the protection, maintenance and enhancement of the foreshore
• To contribute to the preservation, maintenance and enhancement of designated Special Protection Areas (SPA), Special Areas of Conservation (SAC), Sites of Special Scientific Interest (SSSI) and RAMSAR sites and Local Nature Reserves (LNR’s), including Southend-on-Sea foreshore.

Affordable Housing

(1) 2.32 A key objective of the Government and the Council is to ensure that everyone has the opportunity to a ‘decent home’. To help meet this objective, the planning system is expected to provide housing that is genuinely affordable to a wide range of people. It is expressed in ‘Sustainable communities: building for the future’ (2003) that a ‘step-change’ in housing supply will be needed to tackle serious shortages that exist, particularly in London and the South East. It states that too many people do not have access to decent, affordable housing and that many are living in housing of poor quality. It considers that more affordable housing should be delivered, especially for key workers, young families and those in priority need; and that new sustainable communities should be created in regions of high demand like the Thames Gateway.

(2) 2.33 In order to achieve this aim, and to ensure that affordable housing is provided in accordance with Southend Borough Council’s Core Strategy, the Council proposes that the Sustainable Communities Criteria should reflect the specific requirements as stated in Core Strategy Policy CP8 ‘Dwelling Provision’, which states that the Borough Council will:

....enter into negotiations with developers to ensure that: all residential proposals of 10-49* dwellings or 0.3 hectares up to 1.99 hectares make an affordable housing or key worker provision of not less than 20% of the total number of units on site; and all residential proposals of 50* dwellings or 2 hectares or more make an affordable housing or key worker provision of not less than 30% of the total number of units on the site. *The rational which will be used by the Council to determine whether more than the specified floor target for affordable housing will be sought will be set out and justified in ‘Part 6 Affordable Housing’ of the ‘Planning Obligations and Vehicle Parking Standards DPD’. For sites providing less than 10 dwellings (or below 0.3 ha) or larger sites where, exceptionally, the Borough Council is satisfied that on-site provision is not practical, they will negotiate with developers to obtain a financial contribution to fund off-site provision. The Council will ensure that any such sums are used to help address any shortfall in affordable housing. Preferred arrangements for this will also be set out in the above DPD.

Flood Risk, Waste and Resources

(4) 2.34 The Council acknowledges and supports the Government’s aims and objectives for flood and coastal defence. A key policy aim is to reduce the risk to people and the developed and natural environment from flooding and coastal erosion by encouraging the provision of technically, environmentally and economically sound and sustainable defence measures. Where existing water supply and sewerage infrastructure is inadequate for the demands placed on it by development, developers should also contribute to any necessary off-site improvements (including sea defences).

(1) 2.35 Core Strategy Policy CP4 ‘The Environment and Urban Renaissance’ states that development proposals will be ‘expected to contribute to the creation of a high quality, sustainable urban environment which enhances and complements the natural and built assets of Southend’. It aims to achieve this by promoting sustainable development and encouraging innovation and excellence in design, including design solutions that maximise the use of renewable resources and resource conservation. Therefore, a developer should ensure that any new development is environmentally sustainable in terms of energy, waste, build type and quality. It should also increase the use of sustainable build types and materials, and ensure that there are adequate facilities for recycling in order to meet local policy objectives and demands.

(1) 2.36 The Council proposes the following Sustainable Communities Criteria as essential to achieving the above aims and objectives:

• To contribute to the provision and maintenance of flood defences
• To ensure no increase in total flood risk within the Borough by provision of suitable flood protection measures and their future maintenance
• To make provision for sustainable urban drainage and minimisation of surface water run off
• To ensure provision of flood resilient development
• To provide for additional local water supplies and sewerage capacity, matching any additional demands generated by development, and minimise water demand
• To contribute towards essential provision and upgrading of utilities related to development
• To contribute towards present and future sustainable power sources and energy efficiency
• To provide for adequate waste management facilities during demolition, construction and post development phases
• To provide facilities which promote and facilitate separation, storage and collection of recyclable, compostable and other waste (e.g. adequate on site storage facilities)

Administration and Monitoring of Planning Obligations

2.37 In line with Government timescales the Council expects planning applications to be determined within statutory 8/13/16 week targets. The delivery of obligations within these timescales may take a considerable amount of time and resources and often requires public consultation, committee resolutions or involvement and support of third parties. Therefore, proposed development will be required to contribute towards the costs incurred during this stage of the process.

2.38 Once a planning obligation has been signed, administrative costs are incurred on tasks such as ensuring on-site measures are provided, financial contributions are received and contributions are spent in accordance with the terms of the obligation. This requires compliance checks, monitoring, project management and implementation by the Council.

2.39 The Council proposes the Sustainable Communities Criterion outlined below as essential to achieving these aims and objectives:

• Contribution to the Council’s costs of administering and monitoring planning obligations

2.40 The administrative and staff costs of monitoring planning obligations will be recouped through a standard payment, which will be used to fund:

• Database development – initial cost £1000, support cost £3,300 per annum
• S106 Monitoring Officer role – delivering planning obligations, enforcement of obligations, site inspections to assess status of schemes, data entry, monitoring of expenditure, report function
• Legal advice – non payment procedures, legal action etc
• Finance liaison and tracking of financial contributions
• Building Cost Information Service (BCIS) subscription for indexation to ensure that contributions reflect current costs within the building industry

(2) 2.41 The estimated total annual cost for the administration and monitoring of obligations is approximately £44,000 per annum (as increased by inflation) and taking this into consideration the administration and monitoring payment will be required in accordance with the following criteria, which reflect the complexity of an agreement and the subsequent monitoring:

• For agreements with one obligation or a contribution of less than £5000 a fee of £250 is charged
• For agreements with one non-monetary obligation or one obligation with a contribution of more than £5000 a fee of £500 is charged
• For agreements with multiple Heads of Terms, 5% of the monetary contribution plus/or £750 per non-monetary Head of Term is charged
• The administration and monitoring fee shall be capped at a maximum of £10,000

In light of the greater fee for large-scale developments with complex planning obligations, phased payments may be agreed by negotiation. These charges will be reviewed annually to reflect the actual costs of monitoring. Had this requirement for an administration and monitoring payment been operational in financial year 2008/9 then £44,581 would have been collected.

Review

2.42 It will be necessary to review this SPD as a whole as further guidance and legislation is evolved by the Council and in light of Government policy and advice.

2.43 Details on planning obligations secured, and the status and use of financial contributions will be reported as part of the Annual Monitoring Report (AMR).