Agenda item

Financial Contributions in lieu of on-site delivery of affordable homes

To consider a report of the Head of Development and Regeneration.

 

 

Minutes:

This was requested by chair, due to some confusion among members about the methodology.

 

Cabinet member, Cllr Robin Bennett, and officer Stephen May were present to present and answer questions.

 

This report explained how the council gets to commuted sums, where onsite delivery and affordable housing isn’t possible and how we get value for money within this process and maximise the value of contributions.

Scenarios were given and what processes were followed to get to the sums.

 

The baseline formulas that govern this were in Appendix 1 – this report was due to be refreshed. The principles were still applicable.

 

We were compliant with legislation and national policy and were comparable to other areas.

 

Stephen May added that in paragraphs 10 and 11, about money per dwelling from contributions – it was not the whole open market value of a dwelling. The registered providers of affordable housing pay the developer for the affordable housing that was built out. The commuted sum represents the difference between what a registered provider would normally pay the developer and the open market value.

 

The meeting was opened up to comments from members.

 

·       A suggestion was made that spreadsheets could help understanding of the figures and sums.

·       Page 35 – typo. Option 1 / option 2 is the same statement.

·       Officer informed that there will be a consultant review of this report, and comments will be considered and integrated where needed.

·       The reviewed report will return to scrutiny for comment.

·       Page 21 – Table 2.2.2 - it was asked why there was no mention of Chalgrove and Chinnor in sales values.

·       Affordability- do we get advice and guidance from consultants when affordable homes are deemed financially non-viable by developers? It was responded that there is national guidance on this, and an independent financial expert will scrutinise such applications. There were few of these situations.

·       When a site gets turned down at planning committee, and then has permission granted at an appeal, do all the same rules apply? S106 and so forth? Officer responded that the same rules apply. The inspector can consider S106 proposals, and yet disregard them if they considered that proposals aren’t CIL legislation compliant. Usually S106 was agreed beforehand, but the inspector will often review this at appeal. This was a site-specific question that could be discussed with officers post meeting.

·       What triggers new calculations and a new revised report? It was confirmed that new affordable housing types have triggered this.

·       Who decides the reasonable level of profit in viability assessments? Officer responded that the standard is based on case law, 17-20%. It’s a higher risk industry compared to other industries. For comparison, Growth Deal affordable housing gives specific top up figures for types of affordable housing. South Oxfordshire had a flat rate.

·       BNP Paribas – why do they have expertise in this? It was responded that it was likely a tender process, that would be the future process. They have a real estate function, and the writer was well known in the field of affordable housing.

·       EUV – Existing Use Value – why was this term used and not purchase value? Officer can look into this further. It does relate to the existing planning permission use.

 

Chair thanked the committee members, Cabinet member and the officers for providing the report.

 

Suggested that the report be circulated to planning committee members – it was suggested that planning officers could arrange this via Democratic Services.

Supporting documents:

 

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