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Planning Obligations

(s106 Legal Agreements or Unilateral Undertakings relating to the submission of planning applications)

A supplementary planning document (SPD) on Planning Obligations has been prepared and is available to view here.

Template legal documents and associated guidance notes - including a worked example.

Important changes to regulations from 6 April 2015

The Community Infrastructure Levy (CIL) Regulations 2010 (as amended in 2014) impose a ‘pooling’ limit on planning obligations entered into anywhere in the District from 6 April 2015. The pooling limit applies to any obligation which was completed after 6 April 2010. From 6 April 2015 in the determination of a planning application the Council cannot request S106 funding for an ‘infrastructure project’ or ‘type of infrastructure’ if more than five obligations entered into since 6 April 2010 have already been committed to that infrastructure project or type of infrastructure.

For the Planning Obligations SPD the Council have already breached the pooling limit of 5 obligations entered into since 6 April 2010 for all types of infrastructure listed in the tables on pages 19 and 35 of the SPD, relating to District Council and County Council services. Whilst the pooling restriction will not apply to all new obligations entered into before 6 April 2015 from this date applicants will not be required to enter into obligations with the Council to commit funding towards any of the types of infrastructure listed in the tables within the SPD. This regulatory change effectively ends the tariff approach set out in the SPD which has been used to capture contributions on a cumulative basis towards relevant services.

Any new obligations entered into after 6 April 2015 will only be towards specific projects and mainly only towards those that need to be delivered on site as part of a development proposal.

As of 28 November 2014 as set out in the National Planning Policy Guidance update, planning obligations will not be applied to schemes of less than 10 units unless in a rural area where a lower limit of 5 units may apply.

For advice and guidance on how these changes may effect new development proposals and the timing of when new planning applications can be submitted please speak to a member of the development management team through the Council’s pre-application advice service.

Questions and Answers

1.    What Sustainable Transport Contributions will apply to my application?
2.    What Sustainable Transport Contributions will apply if my application replaces existing dwellings?
3.    Will my planning application require planning obligations?
4.    What do I need to submit with my planning application?
5.    Does my application require a Section 106 Legal Agreement or a Unilateral Undertaking?
6.    What if I am not purchasing the land until planning permission has been issued?
7.    Who must sign the Section 106 Agreement or Unilateral Undertaking?
8.    I have a mortgage or charge registered against my property
9.    I have only just taken the transfer of the Planning Application Site and my ownership has not yet been registered

1.What Sustainable Transport Contributions will apply to my application?

The sum of £500 per car parking space provided on site (including garages) should be applied as outlined in 5.8.7 and 5.8.11 of the Planning Obligations Supplementary Planning Document.  Table 1 on page 19 and Table 9 on page 42 provide an example for each dwelling type if the actual number of spaces on site is strictly in accordance with the Council’s Vehicle Parking Provision Supplementary Planning Document.  As an example, the tables show a sum of £1,125 required for a three bedroom dwelling outside the town centre.  This equates to the maximum of 2.25 car parking spaces at £500 per dwelling.  In practice, strictly 2.25 spaces are likely to be either 2 or 3 spaces for smaller schemes, whichever is found as acceptable.  Therefore, the actual sum payable will be either £1,000 or £1,500.

2. What Sustainable Transport Contributions will apply if my application  replaces existing dwellings?

If it is proposed to demolish existing buildings, paragraph 3.5, page 18 of the Planning Obligations SPD allows for these to be taken into account in calculating the standard charge.  For calculating the figures to be discounted, the actual maximum provision required by the Vehicle Parking SPD will be applied to those buildings to be demolished.   This approach reflects an understanding that dwellings may, over the years, acquire parking provision well in excess of the current parking standards.

3.Will my planning application require planning obligations?

In general the thresholds for applications requiring planning obligations are developments of one or more dwellings.  Non-residential development relates to proposals with additional car parking spaces and applications that result in an increase in floorspace within the Town Centre as defined in the North Hertfordshire Local Plan No 2 with Alterations (adopted April 1996) and out of centre retail.  On occasions there may be applications requiring planning obligations that are below these thresholds.  The thresholds have been set to address the cumulative impact of development within the District.  Further details are contained within section 3.2 of the SPD.

4.What do I need to submit with my planning application?

An important element of the SPD makes fundamental changes to the details submitted with planning applications.  Section 8.1 of the SPD contains a checklist adopted by the Council as a direction under regulation 4 of the Town and Country Planning (Applications) Regulations 1988 and Section 62 of the Town and Country Planning Act 1990.  The following will now need to be submitted for planning applications that require planning obligations:

Checklist

  • Proposed heads of terms (the main aspects) of a legal agreement, draft S106 agreement or unilateral undertaking or a justification for non-compliance with the standard charges;
  • Proof of the owner’s title (including title plan).  All the owners of the site will need to enter into the agreement.  If the land is registered this will be by recent office copy entries (no more than 21 days old).  If it is unregistered, an epitome of title should be provided;
  • Names and addresses of any chargees, lessees, mortgages or other holders of security on the land, as all parties with an interest in the land;
  • A solicitor’s undertaking to pay the Council and County Council’s reasonable legal costs in connection with the negotiation and preparation of the legal agreement.  Applications that have a unilateral undertaking will instead need to send in a cheque for the Council’s legal and monitoring costs; and
  • Contact details if there is a solicitor acting on behalf of the applicant.

5.Does my application require a Section 106 Legal Agreement or a Unilateral Undertaking?

Applications for straight forward non-residential schemes and one or more dwellings but less than twenty dwellings in total will need to submit a completed unilateral undertaking with the planning application.  Template legal documents for unilateral undertakings have been prepared.  See the above attachment for template legal documents and associated guidance.

Residential schemes for twenty or more dwellings and non-residential schemes that have obligations in addition to the standard charges are likely to require a legal agreement.  A draft s106 agreement or draft heads of terms will need to be submitted with the application.

6.What if I am not purchasing the land until planning permission has been issued?

The current Owner and the Applicant will have to be a party to the Deed and so are required to sign it.

7.Who must sign the Section 106 Agreement or Unilateral Undertaking?

1. The OwnerAll owners must sign the Agreement.  It is common for ownership to be in joint names.
2. The ApplicantThe Applicant may be different to the Owner (refer to (6) above)
3. The mortgagee or chargee with a registered charge 
4. Any person with a leasehold interest in the land. 

8.I have a mortgage or charge registered against my property

The Mortgagee or Chargee must be a party to the Deed as they have a pre-existing interest in the Property.  The planning obligation binds the land and so the mortgagee must consent to this.

If you are submitting a Unilateral Undertaking and wish to proceed with the Mortgagee not being a party to the Unilateral Undertaking you should proceed with Schedule A that allows for payment of contributions on completion of the Undertaking rather than commencement of development.

9.I have only just taken the transfer of the Planning Application Site and my ownership has not yet been registered

If the Transfer has not yet been registered at the Land Registry you will need to supply a certified copy of the Transfer with the Application and a proof of the title at the date you purchased the site.

If you are submitting a Unilateral Undertaking paragraph A of page 2 will need to be amended to recite the details of the transfer including the parties to the Transfer and the date of completion of the Transfer.