s106 agreements – issues of landowners to consider

By Oliver Bussell, Partner, Planning

Following Labour’s general election victory in July, mandatory housing targets were reintroduced for England and a re-evaluation of the green belt was started. Change is afoot! But what often goes unremarked is the importance of s106 agreements in fostering development.

An agreement under s106 of the Town and Country Planning Act 1990 is made between a landowner and a council. It provides infrastructure, mandates works or commits money for planning permission and ensures that the disbenefits of development are mitigated by the developer rather than the taxpayer.

There are risks for both parties here. The council risks not securing full mitigation. The landowner risks contributions which make the development unviable.

So, what is justifiable? Ultimately, it’s a matter for negotiation; councils have standard requirements for everything from affordable housing to provision of green space and bike racks! Also relevant is the type of development and how important it is to the economy. Fortunately for landowners there are also legal tests which circumscribe what councils can seek.

Many developers complain of the delays that accompany s106 negotiations. These usually occur because of uncertainty about what is justifiable; also the sheer number of parties who end up needing to covenant. These include landowner, mortgagee, developer, district council, county council - each with their own lawyer and comments on a draft. Increasingly the district council will take a lead on the negotiation, even leaving the county council out sometimes – and that kind of pragmatism is very helpful to developers.

My advice to developers would be:

• Accept that some form of s106 contribution is probably due, albeit this increases the costs of the project.
• Involve your solicitor early on in scrutinising the council’s s106 requirements and being ready to push back on anything that is not legally defensible.
• Keep in touch with the planning officer so that your team is speaking with one voice to the council at all times.

If you wish to discuss this further, please do not hesitate to contact Oliver Bussell on email: opb@cooperburnett.com or tel: 01892 515022.

This blog is not intended as legal advice that can be relied upon and CooperBurnett LLP does not accept any responsibility for the accuracy of its contents.

This blog was originally published in the Tunbridge Wells Business Magazine: https://twbusinessmagazine.com/