What is CIL?
The Community Infrastructure Levy (CIL) is a non-negotiable charge on new buildings to help pay towards the infrastructure needed to support growth in an area. CIL was adopted by Chelmsford City Council on 1 June 2014 and is applied to all residential and retail developments which add one or more new dwellings or more than 100sqm of floor space. Affordable housing and certain charitable-led developments are exempt from CIL. Section 106 obligations will continue alongside CIL but in a much reduced form. In particular S106 agreements will continue to be used to deliver affordable housing and anything required just for a specific site, such as a new access road. Chelmsford City Council has identified the types of infrastructure it wishes to fund in whole or in part by CIL and these are set out in the Council's Regulation 123 Infrastructure List: www.chelmsford.gov.uk/cil. Importantly, Parish and Town Council's will receive a share of CIL known as the 'Neighbourhood Allocation' for spending on their own priorities.
How much income from CIL can a Parish or Town Council expect?
The CIL Regulations require that Chelmsford City Council allocate 15% of income from CIL for spending within the neighbourhood of contributing development – this is known as the Neighbourhood Allocation. This 15% allocation is passed to the relevant Parish or Town Council.
The payment to a Parish or Town Council is capped at £100 per Council Tax dwelling per year, so if a Parish contains 100 properties it will not be eligible for any more than £10,000 per year in CIL payments.
CIL Monitoring Report 2016/17
A further 10% will be available for Parish and Town Councils which have an adopted Neighbourhood Development Plan in place. Therefore Parish or Town Councils with an adopted Neighbourhood Development Plan will receive a 25% Allocation, with no cap.
The relevant proportion of CIL funds will be passed to the Parish or Town Council every 6 months. Funds will be passed to the Parish or Town Council by 28 October for all funds received between April and September, and by 28 April for all funds received between October and March.
It should be noted that CIL is paid in instalments upon commencement of development, so it may be some time following the granting of planning permission that a Parish or Town Council receives its proportion of CIL funds. In addition, although there may be a number of developments within parishes which should yield a CIL payment, the Government introduced a change in the CIL Regulations in 2014 which permits self-builders to be exempted from paying CIL, so income is more likely to come from small to large housing sites rather than single dwellings.
What can the money be used for?
The proportion of CIL that a Parish or Town Council receives must be used to support the development of the area. Funds can be spent on:
- The provision, improvement, replacement, operation of infrastructure; or
- Anything else that is concerned with addressing the demands that development places on an area.
This gives Parish and Town Councils considerable freedom to spend their proportion of CIL on the things that address the impacts of development in their area. Examples include:
- Improvements to a village hall;
- New or improved play areas;
- Improvements to cycle / pedestrian routes
If the Parish or Town Council does not spend CIL money within five years or receipt, or does not spend it on initiatives that support the development of the area, Chelmsford City Council may require it to repay some or all of those funds. Chelmsford City Council has discretion with this, for instance if the Parish or Town Council makes it clear that it is purposefully 'banking' its CIL money until it has collected sufficient to pay for a larger scheme.