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AFFORDABLE HOUSING AND CIVIC GAIN

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					                                                                               THIS REPORT RELATES
STIRLING COUNCIL                                                               TO ITEM
                                                                               ON THE AGENDA


ENVIRONMENT COMMITTEE                                                          ENVIRONMENT SERVICES


4 NOVEMBER 2004                                                                NOT EXEMPT


                                         AFFORDABLE HOUSING AND CIVIC GAIN




1          PURPOSE

           1.1         To consider the impact on Affordable Housing allocations on those
                       developments, predominantly Council led, where there is an identifiable ‘Civic
                       Gain’ which could not be achieved without the cross funding from residential
                       development.



2          SUMMARY

           2.1         The Council is taking forward some developments on land which it owns
                       where housing is being proposed to provide cross funding for other elements
                       of the development; these developments include the Schools PPP and
                       Forthside. In these developments if the housing were to contain affordable
                       housing, the resources available for cross funding would not be maximised. It
                       is proposed that where housing developments include an element of ‘Civic
                       Gain’ that the requirement for affordable housing can be reduced or removed.



3          RECOMMENDATION(S)

           3.1         To agree that in those residential developments where there is identifiable
                       Civic Gain, that the requirement for Affordable Housing can be flexibly applied,
                       to adopt the attached Supplementary Planning Guidance on Civic Gain and
                       Affordable Housing.

           3.2         To note that reports monitoring the performance of the Local Housing Strategy
                       and the Development Plan in providing Affordable Housing and other gains will
                       be prepared.



4          CONSIDERATIONS

           Background

           4.1         The Council’s planning policies seek the provision of affordable housing on all
                       new housing development sites. This policy approach has been refined
                       through experience and practice. The approach adopted was confirmed by
                       the Environmental Quality Committee in September 2003 which approved the
                       paper: ‘Planning to meet Stirling’s Housing Needs, July 2003’. This approach

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                       was debated at the Local Plan Inquiry in September/October 2003. The
                       Reporter has recently submitted his report on the Inquiry and has found in
                       favour of the approach adopted by the Council.

           Policy Approach

           4.2         The Council’s approach to the delivery of affordable housing is:-

                       a. For planning purposes, affordable housing is defined as housing at 25%
                          less than market value (or rent);

                       b. The Council has expressed a clear preference for affordable housing to be
                          delivered as social rented housing on site;

                       c. There is recognition that support from Communities Scotland is required
                          and this has been achieved through the approval of the Local Housing
                          Strategy;

                       d. Where social rented housing can not be delivered the Council will seek a
                          commuted payment to use to provide affordable housing elsewhere. This
                          has been successfully achieved on a number of recent developments;

                       e. Commuted payments are calculated as a monetary sum equivalent to 25%
                          discount on the lowest priced unit on the site, times the number of units
                          required to meet the affordable housing requirement.

           4.3         The Council’s Local Housing Strategy states that it will use its land holdings to
                       meet affordable housing requirements. The consequence of both the
                       Development Plan and the Local Housing Strategy is that the Council is
                       obliged by its own policies to consider affordable housing provision on its land
                       holdings and as part of any housing developments in which it is involved.


           Council Led Developments

           4.4         There are several developments where the Council is either the developer,
                       lead developer or landowner, which include elements of housing (e.g.
                       Forthside, Station Square and potentially, elements of the Schools PPP). In
                       such circumstances the housing is there for several reasons, and often it plays
                       a crucial role in ensuring that the development package is economically viable
                       and does not require a disproportionate contribution from the Council’s Capital
                       Programme, in effect the housing is cross funding the other elements of the
                       development. If Affordable Housing is required, this will reduce the economic
                       cross funding, or require a disproportionate amount of housing to fund both the
                       development being enabled and the Affordable Housing.

           4.5         In these types of development where the Council is involved, the major
                       purpose of the development is to provide features which the private sector
                       would not because they are not economically viable. These features, such as
                       the public square, open space, public art, traffic re-management etc.
                       associated with Forthside and Station Square are required to add to the vitality
                       and quality of life in the city centre. If there is housing included in the Schools
                       PPP, this is to subsidise the reprovision of the schools in the most economic
                       way without burdening the Council with high budgetary provisions. In other
                       circumstances, such as Raploch, the Council is developing new housing as
                       part of the regeneration of the area, and here it is proposed that there will be
                       new affordable housing, especially social rented housing.


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           4.6         In dealing with new residential developments led by the private sector, the
                       Council, through the Planning Panel, has consistently sought to achieve more
                       affordable housing through requiring all new housing developments (over 20
                       units) to address this issue. If the Council does not follow its own policies in
                       providing affordable housing, where it is leading developments such as
                       Forthside etc, it will be clearly open to criticism from the private sector, unless
                       there is clear policy justification why Affordable Housing is not being provided.

           4.7         The Local Plan Policy does make provision for part or full exceptions from the
                       requirement to provide affordable housing where there are abnormal site costs
                       which would obstruct delivery. These abnormal site costs are intended to
                       relate to physical site constraints which will have to be overcome to allow
                       development to proceed, e.g. contamination, flood prevention, infrastructure,
                       high access costs etc. In the two current types of housing development the
                       housing development is being proposed in part to cross-fund other aspects of
                       the Council’s development requirements, and cannot be considered as
                       abnormal site costs.

           Civic Gain

           4.8         In these developments such as Forthside and the Schools PPP, the Council is
                       pursuing some of its most pressing objectives, however social and affordable
                       housing is also clearly important, and in the eyes of those excluded and in
                       need, probably an even more important objective. However the Council often
                       has to make decisions, balancing and reconciling conflicting objectives, and
                       provided that there is a clear policy making rationale to these decisions, they
                       are defensible.

           4.9         In the developments such as Forthside and the Schools PPP there is a clear
                       ‘Civic Gain’ which could not be achieved unless there was cross funding from
                       some aspects of the development, i.e. public realm, improved school facilities
                       etc; funded by private housing, the alternative funding for these aspects would
                       be higher contributions from an increasingly limited public purse. Its is
                       therefore proposed that where there is an identifiable civic gain in a
                       development which includes new housing, that the affordable housing
                       requirement will be reduced or removed altogether. It should be noted that to
                       be consistent, this policy should relate not only to those developments
                       containing housing elements led by the Council, but also be applicable to all
                       developments where the Council has identified that a ‘Civic Gain’ is required.

           4.10        For the purposes of this policy, Civic Gain is defined as:-

                       a     The Reprovisioning of any Council facilities, and the Provision of New
                             Council Facilities;
                       b     Physical Regeneration;
                       c     Civic Spaces and Town Centre Improvements;
                       d     Transport and Road Improvements not required because of the
                             development.

                       It should be noted that many housing development sites have other ‘planning
                       gain’ requirements, (e.g. Open space, Landscaping, Play Space, meeting
                       education shortfalls etc.) and these should not be considered as ‘Civic Gain’
                       resulting in a reduction in affordable housing requirement. A Policy Statement,
                       which will be considered as ‘Supplement Planning Policy and Guidance’, is
                       attached.


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           4.11        The Council could consider not adopting a policy on Civic Gain, and deal with
                       these anticipated housing developments as justified exceptions and
                       departures to policy, however, there are likely to be a considerable number of
                       applications (at least 5) within a short timescale and cumulatively these would
                       set a precedent which other developers could use to argue against meeting
                       affordable housing requirements. It is therefore preferable to have an
                       established policy position, rather than dealing with the circumstances of
                       individual applications. The provision of Affordable Housing and other
                       “planning requirements and gain” will be monitored and reported.



5          POLICY IMPLICATIONS

           5.1         The proposal will allow the Council to pursue elements of its development
                       agenda, but it will reduce the scope for meeting its affordable housing
                       requirements.



6          CONSULTATIONS

           6.1         Internal consultations with Housing and Legal.



7          RESOURCE IMPLICATIONS

           7.1         None.



8          BACKGROUND PAPERS

           8.1         Local Housing Strategy and Development Plan.




Author(s)
Name                                               Designation                         Tel No/Extension

Mick Stewart                                       Head of Planning &                  01786 432958
                                                   Regulatory Functions


Approved by
Name                                               Designation                         Signature

Arthur Nicholls                                    Director of Environment
                                                   Services



Date           20 September 2004                                          Reference   ENV27MS
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                                                                                          APPENDIX




Supplementary Planning Guidance on Civic Gain and Affordable Housing

1.         Civic Gain is defined as:-

           a) The Re-provisioning of any Council facilities, and the Provision of New Council
                 Facilities;
           b) Physical Regeneration;
           c) Civic Spaces and Town Centre Improvements;
           d) Transport and Road Improvements not required because of the development.

           and is additional to other planning requirements associated with new housing,
           including open space, landscaping, play space, community facilities, meeting
           educational shortfalls and other infrastructure needs.

2.         Where the Council decides that Civic Gain is desirable from a                 development,
           especially where an element of housing is introduced to cross fund           the civic gain
           elements, then the need for affordable housing can be applied flexibly.      The civic gain
           and the housing element will be integral parts of the business               case for the
           development, and the civic gain will be pre-determined by the Council.

3.         It is unlikely that any civic gain opportunities will be identified by any source other than
           the Council, however civic gain may be a requirement of private or other public sector
           developers. Civic gain will normally be identified through the Development Plan
           process.

4.         It is not proposed to make the business cases involving civic gain public, however
           these will be subject to normal Council audit procedures.




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