Levy set to raise millions for investment in local infrastructure

Around £4 million a year could be raised to spend on improving services, infrastructure and facilities in Shropshire under a new charge on developers.

Under Shropshire Council’s new Core Strategy, developers will be required to make a contribution towards schemes to improve the surrounding area, under the new Community Infrastructure Levy.

At its meeting on 16 March 2011, Shropshire Council’s Cabinet agreed that the levy rate should be £40 per square metre for residential developments in towns and key centres (equivalent to about £4,000 for a new three-bed home), and £80 per square metre for residential developments rural areas (equivalent to about £8,000).

People will be able to submit comments about these proposed charges between 18 March 2011 and 21 April 2011. They must then be examined by an independent inspector before they come into effect.

The majority of Levy income would be ringfenced to the area where new developments are taking place, to improve local infrastructure and reduce the impact of such schemes on the local community.

Councillor Mal Price, Shropshire Council’s Cabinet member for housing and planning, said:

“Under these plans, local settlements would receive Levy funding in direct proportion to the amount of development in their area.

“This approach is part of the council’s localism agenda and new way of working, and will help our local communities to gain wider benefits from the development being carried out in their area, and improve the sustainability of the place in which people live.”

At the Levy rates of £40/m2 in the towns and £80/m2 in the rural areas, the total expected income for infrastructure improvements for Shropshire will be in the region of £4 million a year. This is a much bigger investment than the sums raised for infrastructure through section 106 planning agreements in the past, which amounted to only £224,000 in 2009/10.

Payments would be due at the start of each development.

It is proposed that the Levy rate on employment-related or affordable housing development, is set at nil so as not to risk any adverse impacts.

For more information and to submit comments about the proposed charges go to www.shropshire.gov.uk/planning.nsf, or email planning.policy@shropshire.gov.uk, between 18 March 2011 and 21 April 2011.

A consultation on the preliminary draft charging schedule took place between 21 January 2011 and 18 February 2011.