Differential CIL rates based on a development's size - Public forum - Planning Advisory Service (PAS)

What appeals procedure are you referring to? The appeal processes under the CIL Regs are mainly procedural e.g. did the CA calculate the correct CIL; did they apportion liability properly; there is no mechanism to appeal the rates set out in a properly approved charging schedule. It looks like in Huntingdonshire's case the Examiner accepted the Council's evidence that larger retail is a different use in this context than smaller retail; they likely serve different markets e.g supermarkets where weekly food shooping is undertaken as opposed to a corner shop. More to the point the two rates are based on viability evidence alone which was accepted by the examiner.

The point being made in the first post is that under Reg 13 of the 2010 Regs Charging Authorities are allowed to set differential rates for different zones and for different uses but the Regs are SILENT on a Charging Authority setting different rates for different sizes of development.

The different use does not have to be defined by the use classes order. It appears that the different use is large retail/superstores that have one characteristic and shops ( which are smaller).

3 or 4 small shops on the ground floor of a residential development might well exceed 500m2 so, using this argument, they then get classified as 'large retail'. Surely that's not the intention?

It may not be the intention but would seem to be the effect if all the units are included in a single permission. It may be better practice for charging authorities to use the Sunday Trading Act as a means of differentiating between types of retail instead of floospace - see report of examination into Portsmouth CIL, David Hogger 10 January 2012.

It is common practice to control the use of retail floorspace and/or the size of unit by condition to reflect the widely different impacts of different types of retailing - i.e. the use is not the use class it is the character of the retailing that takes place. In relation to CIL, if you can differentiate the "use" in the same way and demonstrate different viabilities then you can set different rates. To avoid the issue identified by Graham use a definition along the lines of "development reulting in a retail unit of (threshold)m2 or more" - indeed you should do this because this reflects the defintion used for "use".

Following Brian's comment I've checked out David Hogger's report on Portsmouth CIL, but it still results in a differential by size (in this case 280m2). He states that a 'small' retail use is different to a 'large' retail use because they display different use characteristics and service different markets, a point made by Gillian above. I can't help but think one could apply such logic to all use classes if one wanted to. How long will it be before a charging authority takes the line that a 100 key budget hotel has a different use than a 20 key boutique hotel? Returning to Huntingdonshire, in his report their examiner (Nigel Payne) doesn't use (excuse the pun) the small and large retail uses being separate uses argument, but instead says '...new larger stores would be more capable of abosrbing a higher CIL rate than smaller ones..'. This suggests that he regards them as the same use, but that larger stores should pay a higher CIL rate than smaller stores simply because they can, and that I suggest is not provided for under Reg 13 of the 2010 Regs. Gerard pointed to limitations of the appeals procedure under the CIL Regs and I have to say that I don't view them as being as limited as he suggests. An appeal would appear to hinge on whether CIL has been 'calculated incorrectly' (Reg 114(1)) and I would suggest that if CIL has been calculated by reference to a charging schedule that can be demonstrated to not comply with the Regulations that provide for it, then CIL cannot have been calculated correctly. Yo yoing back to Portsmouth, having had my attention drawn to them by Brian, I have to say that Portsmouth's CIL Charging Schedule does not appear to be compliant. Apart for the <>280m2 split on retail, there is a split on in-centre-retail and out -of-centre retail (i.e. zoning) however there is no map to indentify in-centre and out-of-centre locations and boundaries as er Reg 12(2)(c). Such maps are located in guidance notes however this is a separate document from the charging schedule, but I would have though that at the very least there should be a reference on the charging schedule to the fact that that the maps can be found in the guidance. Also, there is no mention of the date the charging schedule was approved (Reg 12(3)(a)) or a statement that it has been issued, approved, and published in accordance with the CIL Regs and Part II of PA 2008 (Reg 12(3)(c)).

Unfortunately it would seem that the latest situation regarding differential rates, brought to light in the recent Poole CIL examination, is that they have backed away from setting a dirrerential retail charge in the face of pressure from a large supermarket retailer. This means it is now unlikely that it will get challenged in the courts and hence potentially clarified in case law. Perhaps DCLG will provide some clarification on this in their recently announced October update to the CIL Regulations?

Would anybody care to open this debate again in the light of the eximiners recent comments in relation to the Borough of Poole's proposals for a CIL Levy? The examiner stated: "With clear evidence that the majority of retail development cannot sustain a CIL charge, this leaves no alternative but to set a nil rate of CIL for all retail development. "I therefore recommend that the schedule is modified to delete the retail charge." Does this imply differential rates for retail are not justified or simply that in order to set them one has to show that there is a majority of development that can support a charge and that there is a clear differential/trigger point between different retail uses to justify differential rates?

Para. 24 of Sue Turner's report states: "There is nothing in the CIL regulations to prevent differential rates for retail development of different scales. However paragraph 25 of the CLG guidance (CIL Guidance: Charge setting and charging schedule procedures) states that where a charging authority is proposing to set differential rates, it may want to undertake more fine-grained sampling to identify a few data points in estimating the zonal boundaries or “different categories of intended use.” Para. 8 of Nigel Payne's Bristol report sends a similar message: "Under the national CIL regulations the application of differential rates for different forms of retail, such as convenience and comparison shopping, and/or distinction by size of unit/floorspace, could only be justified by rigorously tested evidence related entirely to viability." Basically, PINS examiners accept the principle that differentiation is acceptable if robustly justified and evidenced.

Thanks for the clarification Peter Can anybody point to an existing good example of an evidence based differential charge for retail?