Local Planning Authority Section 106 Agreement

As a property developer, you may have come across the term “local planning authority section 106 agreement” or simply “section 106 agreement” in your dealings with local councils. Understanding what this means and how it affects your development is crucial to the success of your project. In this article, we`ll explore what section 106 agreements are, why they exist, and what you need to know as a property developer.

What is a Local Planning Authority Section 106 Agreement?

A section 106 agreement is a legally binding agreement between a property developer and the local planning authority. This agreement is put in place to mitigate the impact of a development on the local community and environment. The agreement can be seen as a form of compensation that developers pay to the local community for the negative effects of their development.

Why Do Section 106 Agreements Exist?

The UK government recognises that developments can have a significant impact on the environment and local community. While developments can bring benefits such as new housing and jobs, they can also contribute to increased traffic, pollution, and strain on local services such as schools and healthcare. Section 106 agreements aim to mitigate these negative impacts by requiring developers to contribute towards local services and infrastructure.

What Do Section 106 Agreements Cover?

Section 106 agreements can cover a range of issues, including:

– Affordable housing: Developers may be required to provide a certain number of affordable housing units as part of their development. These units must be offered at a reduced price, making them more accessible to low-income households.

– Education and healthcare: Developers may be required to contribute towards the construction or improvement of local schools and healthcare facilities to accommodate the increased demand generated by their development.

– Transport: Developers may be required to contribute towards the construction or improvement of local transport links to mitigate the increased traffic generated by their development.

– Environmental impact: Developers may be required to contribute towards the preservation or enhancement of local green spaces, biodiversity, and wildlife habitats.

What Do You Need to Know as a Property Developer?

As a property developer, it`s essential to understand that section 106 agreements are a legally binding requirement. Failure to fulfil your obligations under the agreement can result in legal action and financial penalties. Therefore, it`s crucial to factor in the costs of any section 106 obligations when planning your development. It`s also important to engage with the local planning authority early in the process to ensure that your development meets their requirements.

In conclusion, section 106 agreements are an essential aspect of property development in the UK. They aim to mitigate the negative impact of developments on the local community and environment by requiring developers to contribute towards local services and infrastructure. As a property developer, it`s crucial to understand your obligations under these agreements and factor in the costs when planning your development. With proper planning and engagement with the local planning authority, you can ensure that your development is a success for all parties involved.

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