Section 106 Planning Concessions

Section 106 planning concessions

Section 106 applies where the Council places an obligation on the developer to contribute to the local community.  

The developer may be building houses, or roads or wind turbines.  The Council may ask for extra social housing or better infrastructure or to build a community centre.  In the case of Boston, Lincolnshire, the agreement was to set up an environmental grant scheme worth £250,000 managed by the Community Foundation with Council and local community reps.

 
Promotion

As always, the key to effective local action is real partnership.  Talk to Council staff, especially the Planning Manager.  Recruit your Mayor, Council Leader and colleagues.  Get them on your side so that local community needs are considered early on in the panning application process.

Managing a section 106 fund

It's essential to hire, create or acquire a purseholding body.  Boston used the local Community Foundation.  Their trustees carry the legal liability; the Foundation employs a financial advisor servicing an investment committee; they have a comprehensive, well-balance, risk-minimising investment policy.  Or you can establish your own "community trust".

Distributing 106 cash

Your capital can be treated as “expendable endowment”.  This means that you can apply the Charity Commission approved “total returns policy”.  You set a notional rate of return, rather than being restricted to (depressed) market rates.  You could, for example, allocate 4.8% to grants and 1.2% to field work and programme management.
Community Needs:
You need to consult local people, define local needs, look at the available services, identify gaps and apply the funds accordingly.  For example:
Lincolnshire is perceived as a comfortable, rural County with a benevolent land-owning tradition.  People retire here to escape the stress of urban life.  But there are down sides:

1. Low education and skills levels
2. Declining jobs market (as agriculture mechanises)
3. Low wages
4. Coastal deprivation (summer peaks, winter troughs, high age profile)
5. Rural isolation (car dependence and poor public transport)
6. Mixed community tension (migrant workers in the South; 10% of the population is Eastern European)

Much of the above results in depressed, fragmented communities where young people lack stimulation and opportunities.  In response, a section 106 wind farm scheme might fund community cohesion and youth projects, especially those that motivate disaffected young people and involve them in creative activities – often with a countryside or conservational theme and educational outputs.

Programme management tasks

We should recruit and train a grants assessment panel, meeting quarterly.  You, or your local Community Foundation, would provide secretariat (panel arrangements, bid scoring and presentation) and field work (telephone and face-to-face support to applicants).  There should be a commitment to evaluate the effectiveness of grant making – visiting sites, monitoring delivery, writing IMPACT reports and publicising success stories to partners and stakeholders.