Practice by Councils of spending S106 monies - Public forum - Planning Advisory Service (PAS)
Grŵp agored
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Wedi dechrau - Gorffenaf 2012
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Gweithgaredd diwethaf - May
Practice by Councils of spending S106 monies
I would like to know if the way S106 monies are spent/allocated, are covered by law or by practice/policy of each Council. As I understand it, S106 money can be used across a borough for whatever community project the administration feels fit. Therefore not necessarily in the Ward from where the money has been generated. It us reasonable that if the money is substantial, to use some of it for areas other than the particular Ward, if it is not all needed by that Ward. My concern is that despite a real need, S106 could be allocated to a Group which is not Ward specific, resulting in the Ward community losing out. I hope this makes sense! I will be grateful for your views and knowledge. Many thanks.
Hi. no S106 law as far as I am aware. The 1st point I'd make is best not to think of S106 money as Council money. It's really contributors money (usually developers) held in trust by Council's for spending only on the purpose for which it was paid. The 2nd point is impact mitigation contibutions should spent on mitigating & by their nature impacts tend to be greater closer to the contributing site. So best practice is to look at the terms (the exact wording) of the s106 (often bespoke than standard) for only then can you establish the purpose of any payment & what, if any, proximity is to play in spending. If not needed by the locality (impacts tend to dissipate with distance) perhaps shouldn't have been sought in the first place or should be repaid. I hope this helps
The spending of S.106 monies is covered by law. Without reviewing all the relevant ins and outs of it, it's worth focusing on Regulation 122 of the Community Infrastructure Regulations 2010. This contains 3 legal tests that an S.106 obligation has to pass. It would legally prohibit spending money secured by a S.106 on anything that was nothing to do with the impact of the development. And this has really always been the case. S.106's are not a means of generating revenue from developments for Council's to spend where they wish: they are means of mitigating the impact of a development. So, to clarify the point made, S106 money CANNOT be used across a borough for whatever community project the administration feels fit.
I would agree with Andrew though I have dealt with Council ssuch as Warrington who have adopted guidance which requires a form of funding through Section 106 that they can spend across the authority for example on general road improvements. It is the purpose of the new community levy process to seek funding towards infrastructure and community benefits though again it is my understanding this should relate to what is required to bring the development forward and the benefit of the adjacent neighbouring community.
It all comes down to a mixture of planning law, contract law and planning policy. Each case will be different, and there have been legal cases on this general area. You need to look at the specific terms of the s106 itself to decide how and for what purpose monies can be applied. The recent investigation at Reading BC, and this debate, shows that misappropriation of s106 monies could be widespread. In some cases developers may be able to reclaim their monies back. Since 6th April 2010 Regulation 122 CIL has limited the circumstances in which a s106 agreement can be taken into account when a planning authority is deciding whether to grant planning permission (and procedural failures may lead to judicial review), but it does not mean that such a document which has been entered into is not legally binding as a matter of basic contract law. The general legal requirements are governed by section 106 TCPA 1990. As far as the specific content of s106 contributions is concerned, there is a noticeable policy difference between what developers can voluntarily offer, what matters can be taken into account on a planning application, and what can be legally demanded of applicants to provide.