The Committee considered a report setting out details of Section 106 contributions that had been secured, received, and spent as at the date of the report. In cases where the contribution had not yet been spent, the report also indicated whether the contribution had been committed to a project.
The Committee noted that Section 106 Agreements could be used to secure financial contributions towards infrastructure. The Council would only seek contributions where a proposed development created additional need or exacerbated an existing deficiency and where it complied with the three tests set out in the Community Infrastructure Levy Regulations 2010 (as amended).
Section 106 Agreements were recorded and monitored using a module of the Acolaid planning database, from the signing of the agreement to spending the contributions. The Council’s Finance team also kept a monitor of income and spend of developer contributions.
Detailed information on Section 106 contributions towards infrastructure were included in the report, which was split into three main sections, S106 Funds Available, S106 Pending Funds and S106 Spent Funds.
As this was the first of the S106 monitoring reports, the Committee noted that this was an opportunity to comment in general terms on the layout and content of the report and to identify and recommend any changes to improve future reports.
During the debate, the Committee made the following points:
· Concern over the length of time some S106 monies had remained unspent and a suggestion that local ward councillors are kept informed as to the status of S106 monies whenever there was a risk that the monies may have to be returned to developers. This would enable them to discuss with local Surrey County Divisional Members whether pooling of monies allocated to highway/ transportation improvements between the two councils could be achieved so that schemes to deliver those improvements could be implemented. Officers agreed to this suggestion.
· Request that future reports showing the list of S106 monies at risk of return to developers were grouped into wards.
· Concern over the level of unallocated and uncommitted S106 monies. The report should be used as a management tool to inform decision making to ensure actions were put into place to spend S106 monies for purposes for which they were required to be paid by developers.
· Concern that S106 monies allocated to provide educational facilities were not being spent in the Borough. Officers indicated that they meet with officer counterparts at Surrey County Council, the health service and Surrey Police to make them aware of the S106 contributions that were available and the specific purposes for which they were provided, and the deadlines by which the monies had to be committed. It was also noted that whilst S106 contributions might be available towards specific educational, healthcare, or public safety schemes, implementation of those schemes would be dependent on the full funding becoming available, which might account for the delay in committing some of the funding.
· In response to an enquiry as to whether in future the Council should request S106 contributions towards viable projects that had some certainty of being delivered, officers confirmed that stringent tests were applied before a S106 contribution could be requested through the planning application process, so that all contributions requested by Surrey County Council and other bodies needed to be earmarked for viable projects and needed to be justified in terms of the amount requested so that contributions were proportionate to the to the scale and size of the of proposed development. Occasionally, it might be necessary to wait for a similar application to be submitted to ensure that a further S106 contribution could be secured to enable sufficient funds to be available to deliver the improvement.
· It was noted that a member of the public had written to the Committee in respect of the report, and it was suggested that officers be requested to respond and to copy the response to members of the Committee. The response could then be looked at in greater detail, if necessary, when the next S106 Monitoring Report came back to the Committee.
· In response to a suggestion that SANG and SAMM contributions be included in future reports, the Committee noted that SANG contributions were commuted sums that the Council had to hold in perpetuity for 80 to 120 years, to use to pay for the ongoing long-term maintenance of the site, not for a specific project within a specified time frame.
· In response to a suggestion that the £270,000 at risk of being returned to developers should be included on the corporate risk register, officers indicated that this was already covered on the risk register under a general loss of funding corporate risk which would apply to the general risk about potential loss of external funding.
· The Committee needs to identify the apparent governance failures of the S106 process, and the changes required to address them.
· Concern that over £6 million of uncommitted S106 contributions in respect of educational provision. In response to an enquiry as to whether, given that most primary and secondary schools in the borough were outside local authority control, S106 contributions could be earmarked for academy trusts rather than with Surrey County Council, officers confirmed that because Surrey County Council was the infrastructure authority, contributions toward infrastructure had to be passed to them in the first instance.
· Query whether the report had erroneously stated that there were no climate change/sustainability implications.
· Suggestion that future reports indicate when S106 monies become repayable to developers.
· Query whether terms of S106 Agreements had been too specific in relation to the purpose for which contributions were made, which could account for the reason why some funds had not been committed.
· It was suggested that £36,045 marked as uncommitted in respect of a contribution towards CCTV arising from a development at the former Tyre and Exhaust Depot, Lysons Avenue, Ash Vale in 2010 had actually been committed and should not therefore be shown as at risk of refund
· A request that details of S106 monies at risk of refund be extracted and included at the beginning of the report with a narrative commenting on the action planned to ensure that monies are not refunded.
Having considered the report, the Committee
RESOLVED: That the report be noted, and the above comments made during the debate be endorsed.
To ensure that the Committee was informed of the extent to which S106 funds were available, pending, and spent/committed.
Officer to action:
· To ensure that local ward councillors are kept informed as to the status of S106 monies whenever there was a risk that the monies may have to be returned to developers.
· To ensure that future reports showing the list of S106 monies at risk of return to developers are grouped into wards.
· To respond to the members of the public who had written to the Committee about the report and to copy the response to members of the Committee.
· To ensure that SANG and SAMM contributions are included in future reports.
· To ensure that future reports indicate when S106 monies become repayable to developers.
· To check the status of the allocation of £36,045 for CCTV contributions referred to above
· To extract details of S106 monies at risk of refund and included at the beginning of future reports with a narrative commenting on the action planned to ensure that monies are not refunded
Specialist – S106/ Finance team