October's conundrum - Major Infrastructure Projects and s106 agreements

This month's conundrum, written by David in our e-bulletin 'Future Perfect?', is as follows...

What should we do where a s.106 is needed for, say, a 500 hectare development, but one or two landowners, of a small area, cannot be persuaded to sign, perhaps hoping for a higher price? We used to suggest that the permission be granted, with a s.106 covering the land under control and with a Grampian condition prohibiting development on the land of the recalcitrant owners till they sign a s.106 in the same form. Of course the traditional approach is that you can't require someone to enter a s.106 by condition. But that's not what such a condition does. And in any case, it's actually a question of certainty - do we know what the s.106 is to say? In the example above, we do.

Now however, the Planning Inspectorate is saying that such a Grampian is unacceptable, citing the Secretary of State's policy (not law) in Circular 11/95, which reproduces the traditional approach. So as a result, some major projects are being held up. On this approach, it will be also very difficult to get the permission which underpins a CPO, as there will certainly be landowners not prepared to sign in that case.

So the conundrum is what to do? What legal and practical solutions have you come across?

Comments

[Denis Hennigan Head of property Future Health & Social Care 2--4 Summer Hill Terrace Birmingham B1 3RA.]

Hi brand new to your sight, but would certainly like to be a part taker. Here is our particular 106 issue, a bit long winded but hopefully worth it. We a cic company currently operating within the thrid sector, have been providing housing, supportive living and domilicary care for individuals with Learning disabilities, mental health issues and those who require supportive living. We identified a parcel of land circa 30 months ago, this piece of land had at some stage been attached to a larger parcel of land, the larger parcel of land had had 24 appartment built upon it, the other piece of land had been sectioned off by the developer. That parcel of land has a section 106 attached to it, the 106 was written and signed by the developer at that time (23 November 2003) The developer sold the retained land after building his 24 appartments. The land was sold to an electrical company who applied for planning to build a commercial unit for it's storage requirements, this was declined on the grounds it was in a residential area. We purchased the site in Feb 2008 after following it for 12 months before. As we provide housing for individuals with LD, MH, and SP issues buying land with a 106 on it at the time did not cause us an issue. As we are a CIC and not an RSL we had to get the Council to accept us as a suitable provider ( We have supplied services to this council for several years and in some ways are seen as a strategic partner by them ) We have been accepted. We then had top apply for planning on the parcel of land, which we did, acheiving planning for 7 two bedroom appartemnts, this planning was granted subject to signing the 106. My questions are, 1, The orginal 106 was specific to a developer and was quite loose in some of it's terminology, the 106 issued to us whilst in the main is exactly the same as the orginal they have attempted to shore up certain areas which cause us concern, my question if there is a change made to the wording of the original 106 should this been seen as a new agreement, so would that new agreement need to be viewed in light of the goverments circlar 05 relating to drafting of 106. Question 2, due to the enconomic turn down we would need to vary parts of the 106 to make the development viable, we would still provide afforable housing but it would need to be specific to our target audience IE LD, MH, SP. not a general afforable list that the council wants us to provide housing for. Any help or comment would be helpful.

Denis Hennigan Head of Property Development.

[David Brock]

Thanks Denis. I have sent you an email about this.

David