Examiner recommends further work to justify proposed Southwark CIL rates

Out-Law News | 02 Sep 2014 | 3:46 pm | 1 min. read

An independent examiner has raised concerns about the evidence provided by Southwark Council in support of its community infrastructure levy (CIL) draft charging schedule (DCS).

The Council submitted its DCS to the Planning Inspectorate for examination on 22 April. The DCS (6-page / 4.6 MB PDF) proposes to divide the borough into three zones with charges as high as £400 per square metre in Zone 1, which covers the north-west of the borough including the south bank of the River Thames between Blackfriars Bridge and Shad Thames.

In a document outlining his interim findings (21-page / 142 KB PDF), examiner Brian Sims raised concerns that the rates proposed by the Council might prevent necessary development in the borough and questioned the evidence used to assess the potential viability of developments subject to the proposed charges.

"I consider that the evidence of viability put forward by the Council is insufficiently robust to support the revised DCS or show that the CIL is set at a level that will not put the overall development of the borough at risk," wrote Sims.

The inspector identified issues with: the relatively small number of sample sites used by the Council to calculate expected development costs and land values; the amount of market testing undertaken to justify the benchmark values used; and the "distinction between destination and other retail development" under the DCS.

Sims found that further information was required to support the rates set for hotel developments and the 'all other uses' category, and the position of the boundary between Zones 1 and 2. Minor amendments to clarify the meaning of "maximum rent" in relation to nominated student housing were also advised.

Sims said that the identified shortcomings with the Council's evidence "do not necessarily mean that the charge rates are unsupportable", but concluded that "there is insufficient evidence currently before me to justify, in particular, the residential rates, the 'all other uses' rate or the destination retail rate".

The inspector recommended that the Council should undertake or commission "additional viability work to improve the robustness of the evidence base". The alternative courses of action open to the Council were to withdraw the DCS from examination or to continue with examination and "accept a likely recommended that the [DCS] be rejected", the inspector said.

According to a report in Planning Magazine, Council cabinet member for planning regeneration and transport Mark Williams said: "We have been asked by the inspector to carry out some further work to justify the proposed CIL rates. It's in all our interests that our CIL rates are based on robust evidence and we will carry out this work as soon as possible."