Re: Defining CIL charging zones - Public forum - Planning Advisory Service (PAS)

We (GNDP) are proposing 2 zones set on the basis of viability evidence. The viability evidence was collected across the whole of the 3 districts that make up the GNDP. The CIL zones are not the same as areas used for planning policy and we did not collect viability evidence based on the planning policy areas. (Fortunately they do not differ greatly and most of our growth will be in the area with higher viability. The regs appear very clear on this and it would be a risk to deviate from this approach!

Mark In line with the guidance I would base the zones on viability rather than your policy areas or other definitions. It would be convenient if viability trends broadly match your 3 core strategy areas but there's no real way of predicting this with any certainty you start to look at viability. However, you may have an understanding of your local markets already e.g. from SHLAA work or a 'feeling/anecdotal evidence' that would help you to predict whether the two things align? Perhaps you could propose in your brief phases within your study, with phase 1 defining the areas to be looked at, and phase 2 assessing viability. Harriet

Phil and Harriet Thanks for the replies. Our affordable housing viability assessment identified differences between the sub-areas but it was commissioned to look at the issue on a sub-area basis. I agree that the zones should be based on viability, however, do you need to identify a zone or area in the first instance to test the viability? Do people start with small areas such as wards and parishes to begin with and then look for patterns of viability to define eventual charge zones?

Commercial viability tends to vary over a very small scale so it is likely to be difficult to define zones. So unless your evidence supports zones it may be better to consider how you can capture value outside of CIL. I still think that to reduce the risk of not being fully compliant with the regs you should start with viability evidence, not predetermined zones. For residential development , plot house prices and see if there is a pattern. If there is a large difference in land values across the area then overlay this information. However dont expect the data to give you all the answers, there will still be a significant amount of judgement involved! I repeat this is about managing risk. You could go down a sub-area based route and sale through the examination.

For "sale" insert "sail" !!!

We have defined indicative viability assessment and character areas based on local geography and land-uses to inform site selection for the viability study. Aligning these selected sites using the LDF, SHLAA and IDP presents a fair representation of the Borough in terms of location and the development likely to come forward in the plan period. By taking relevant local circumstances into account through undertaking viability assessments, the CIL will not just be a scientific or technical exercise, but one specific to the future infrastructure needs of the locality. It is this viability assessment evidence which will ultimately determine the CIL charging zones for the Borough. In any case or locality, whether or not there is an up-to-date development plan in place, it is fundamental that charging zones are not based purely on policy or political aspirations, but are informed by a robust viability evidence base. Perhaps this information is useful, helps answer some queries and prompts further posts or discussions. Any feedback on our particular approach to defining viability assessment areas – and ultimately the CIL charging zones – are most welcome! Regarding a discussion point in another post, above, we are particularly interested in how plotting house prices and identifying patterns could translate into a viability consideration? This is something that we are not currently pursuing.

If you want to define zones for residential development I suggest that you start by analysing existing house prices by post code. That is easily done. Personally I find the presentation of the land registry data on the BBC website the easiest to use. For commercial uses I would suggest that you don't bother. It isn't generally viable anywhere at present and schemes are only getting funded in particular circumstances. Retail is more complicated. If you want to talk through the options in that respect give me a call on 07944006891.

Sean, In basic terms, any assessment of viability should look at costs and values. For example, residential development costs would include the price of the land, construction costs, finance and interest, agents fees etc. and the value would be either the price of selling the whole development on, or the purchase price of individual houses. Using house prices is therefore a good starting point to understanding how your local market varies across your area because it gives you some information on values. You could plot house price data geographically and understand where the market is stronger (i.e. where houses are selling for more) - this could then help inform zones for a more detailed assessment of viability. Similarly, for commercial uses, you could look at rents.

Thanks Harriet, Yes - residential development costs are fundamental to the viability assessments. We are also now looking to consider property prices within the local housing market area/s to (as you say) gain a better understanding of values and to help further determine viability zones. However, it is translating such information into a charging schedule which is the real test. Sean

I think paras 34-40 of the Charge Setting and Charging Schedule Procedures March 2010 give the best guidance. The zones should be based sollely on viability evidence - inevitably this usually relates directly to land and property value since construction cost rates are likely to be uniform across an Authorioty area. We collected valuation evidence across the district based on a parish level survey. Inevitably groups of parishes with similar values emerged and informed charging zones. The draft charging zones then inform the viability testing ie the land and property value inputs for each category of development being tested are then consistent across the zone. In hindsight we were probably over cautious and ended up with more zones than necessary. On review I expect some zones will be amalgamated - but the underlying approach is still robust. I have a draft brief for CIL viability studies which covers this issue if this would be of any assistance. Adrian Kerrison, Newark & Sherwood District Council adrian.kerrison@nsdc.info

 

If I may revive an old, but still relevant debate - What are people's thoughts on the soundness/legality of defining CIL charging zones by a brownfield/greenfield differential?

Is anyone aware of any examples of this?

I would be grateful for any thoughts or advice.