Agenda item

Canal Lane, Hose

Application:	22/00006/VAC
Location:	Field OS 6260 Canal Lane, Hose
Proposal:	Removal of Condition 4 (provision of on-site affordable housing requirement) of planning permission 19/00859/OUT

 

 

The Senior Planning Officer (AC) addressed the Committee and provided a summary of the application and advised that 2 further letters of representation had been received raising which raised concerns about the viability report that had been submitted and also concerning contributions to the local village facilities. The viability appraisal had already been fully assessed within the report and with respect to the local village facilities the contributions had been previously secured at the outline stage so this was not for consideration as part of this application. The application was recommended for approval for the removal of condition 4 subject to conditions and a Deed of Variation.

 

Responses to Member queries were as follows:

 

·         The viability analysis set out that the profit would be below the viability threshold for this development

·         If the application was refused, the decision could be appealed by the applicant and based on the figures given in the report, it was likely the Planning Inspector would apply significant weight on the viability test

·         The affordable housing allocation could initially be ring-fenced for Hose

·         There was an initial viability study in 2019 at the outline stage which was based on generic costs and the independent assessor considered that profitable. However the latest assessment was more robust and with detailed figures and independent assessor now advised that the development was not viable

 

Pursuant to Chapter 2, Part 9, Paragraphs 2.8-2.28 of the Council’s Constitution in relation to public speaking at Planning Committee, the Chair allowed the following to give a 3 minute presentation:

 

Adrian Kerrison, Agent Plumtree Homes LLP

 

Following the speaker’s presentation, the following points were noted:

 

·         The 10 per cent referred to was gross profit 

·         There were £680k of abnormal costs which included significant cut and fill to help alleviate the 6 metre slope from the top corner to the bottom corner that required several plateaus, new rising mains to be installed, a large attenuation pond, there was a road widening scheme required by the County Council, archaeology works, various other works such as a newts issue that had been resolved

·         Market forces over the past 2/3 year had led the 55 per cent increase in costs

·         In 2019 although the independent assessor considered the site was viable, the developer felt sceptical and did not consider the affordables deliverable in the form required by the Council. They were negotiating for a more viable option of a smaller number of 80 per cent market value homes and they had never signed off on the affordable housing requirement

·         Since then costs had increased hence the current viability analysis that had been verified by the independent assessor

·         The agent advised that they had made it clear from the outset that 42 percent was not achievable

·         The land had been purchased in 2019 and the outline application was submitted in 2020

·         They were a small high specification builder and had reduced costs and specification and construction costs where possible but this still did not make the site viable

·         The homes would range between £220k and up to £600-800k in value

·         They were aware of the affordable housing policy when they purchased the land

 

During debate the following points were noted:

 

·         There was concern at housing viability as the need was well established before the land was purchased

·         It was felt more legal guidance, case law, previous appeal decisions were  needed before a decision could be made and possibly a deferral on this basis may be proposed

·         There was concern that affordable homes were needed for people to get on the housing market in Hose

·         It was suggested that there was case law and a high court judgement where cases such as this were tested and affordable housing was not removed

·         It was felt if this application was approved it would set a precedent for other developers

·         The Planning Development Manager advised that the removal of the condition was within the principles of the NPPF and the Local Plan and the Neighbourhood Plan all of which stated viability had to be proven. The Council would also then seek to retain the affordable housing element even though there were those policies

·         It was considered that there was not enough information as the land cost  should not be factored into viability and case law of similar cases was required

·         There was a conflicting view that case law and legal opinions were not material documents for lay people in determining a planning application 

·         The Senior Solicitor advised that case law was binding but he had not seen the case law and high court judgement referred to and should the application be deferred the applicant could go for non-determination as the deadline for determining the application was only days away. Should this happen, the Planning Inspectorate would determine the application and the Council may lose the opportunity to apply conditions that may be considered by the committee

·         The Ward Councillor considered that 11 affordable homes had been discussed and at no point were they advised they would not be delivered

·         The Senior Solicitor advised that viability was a genuine mechanism and was not concerned with historical information or data

·         It was pointed out that the developer had not accepted the affordable housing position from the start and the 2019 application had stated that the full costs were unknown at that stage

·         There was mention as to whether Homes England had been involved in this application

·         There was a move for deferral to consider the Park Road judgement and other appeal decisions and case law and bring this information back to the committee

·         It was reiterated that the development had been independently assessed on viability and there was nothing further they could do apart from consider previous appeal decisions

·         There was concern on the risks of deferment against the balance of the issues and did viability trump other factors with the Planning Inspectorate

·         The Planning Development Manager advised that the report outlined the policies, the SPD and the NPPF and the Council’s compliance with planning policy and as this was a legitimate mechanism it was likely the Planning Inspector would permit the application

·         A Member felt that they should they defer to ask for legal opinions and case law it could cost the Council more money and a lengthy deferment

·         The Senior Solicitor explained that the Legal Team could obtain external legal expert opinion when required. He could not respond on whether viability trumped planning policy and stated officers had to abide by the rules and highlight the risks

·         The Senior Planning Officer advised that viability was a tool and a mechanism and was part of the NPPF

·         There was a suggestion to defer to reduce the contributions based on reduced income and a Member referred to some guidance where this had happened

 

(Councillor Cumbers apologised for her late arrival and asked if she was able to vote. The Senior Solicitor advised she had arrived at 6:05pm during the Senior Planning Officer’s presentation, however she had been present for the speakers and debate. The Senior Planning Officer advised there had been no update in his presentation therefore the Senior Solicitor advised that it was the Member’s decision whether to vote.)

 

Councillor Higgins proposed a motion to defer the application to gain more confidence in the reasoning by receiving legal guidance, previous case law and appeal decisions including the Park Road judgement. Councillor Evans seconded the motion. On being put to the vote, there were 5 for and 6 against therefore the motion was lost.

 

Councillor Allnatt moved the recommendation in the report and Councillor Pritchett seconded.

 

RESOLVED

 

That the application be APPROVED subject to :

 

(1)  the conditions set out in in the report;

 

(2)  Deed of Variation to the previously completed agreed Section 106 Agreement to

 

Continue to secure contributions towards

(i)   Primary and secondary education provision.

 

Include contribution towards

(i)   Off-site Affordable housing provision

 

Remove contributions for

(i)   Sustainable transport options

(ii)  Waste services

(iii)                Library services

(iv)NHS contribution

 

(3)  Include a Late Stage Review Mechanism

 

(5 for, 4 against, 2 abstentions)

 

(Councillor Cumbers requested that her abstention be recorded as she advised she did not have enough information to make a decision.)

 

Councillors Evans, Glancy, Gordon and Higgins requested that their votes against the motion be recorded.)

 

REASONS

 

The application has been supported by a viability assessment which indicates that the provision of affordable housing on-site as required by the condition would not be viable.

 

The Council have sought external and independent advice on the submitted viability assessment, the results of which state that should affordable housing be provided as part of the development, then the scheme would not be economically viable. The application would still provide the same amount of financial contributions that were secured by the originally agreed Section 106 agreement under planning permission (reference 19/00859/OUT), however the lower priority contributions would be redistributed and from an off-site affordable housing contribution. The independent viability assessment included these contributions within the overall assessment

 

The original outline application (reference 19/00859/OUT) was supported with a viability assessment where the applicant aimed to demonstrate that the scheme was unviable in order to the remove the affordable housing provision. However during the course of the original outline application, officers were concerned that given the scheme was in outline form it was difficult to understand the associated costs and values of the development as no detail of the proposal has been determined. Therefore the affordable housing provision was secured at outline stage.

 

Following approval at outline stage, the reserved matters for the layout of all 34 dwellings and scale and appearance of 5 dwellings have been approved under application (reference 20/01135/REM).

 

As the reserved matters have now been approved showing the layout of all 34 dwellings, consideration can be given to the detail of the development (something which was difficult to assess at outline planning stage). The viability assessment that has been submitted is in accordance with the detail of the development that has been approved through application 20/01135/REM. Therefore the viability assessment which has been submitted is considered to be an accurate representation of the costs that would be incurred.

 

Overall, it is considered that up to date, acceptable and robust evidence of viability has been provided which demonstrates that the development is not capable of providing the policy target of 32% (11 Affordable Housing units).

 

A number of different options have been considered within the viability assessment which demonstrate that any provision of on-site affordable housing (across any tenure mix forms) would not be economically viable.

 

The loss of affordable housing provision would not be in line with Policy C4 of the Melton Local Plan or Policy H6 of the Clawson, Hose and Harby Neighbourhood Plan. However the submitted viability assessment has been considered in detail during the course of the application of which the independent viability assessment concluded that the removal of the affordable housing provision is absolutely necessary in order to make the development financially viable and deliverable.

 

To emphasise this further, the conclusion of the viability assessment showed that there would still be an overall loss as a result of the development, despite removing the on-site affordable housing provision.

 

Whilst the proposal would not be in line with the aforementioned policies of the Melton Local Plan and Neighbourhood Plan, the Council have adopted both the Affordable Housing SPD and Developer Contributions SPD. Both of these SPD’s are material considerations within the determination of the application and do allow for the submission of viability assessment. The Affordable Housing SPD provides clear guidance and advice on the submission viability assessments and what detail and level of information should be contained within them. The viability assessment submitted is considered acceptable in this regard as a starting point and contains all the required information and detail in order to make a decision.

 

Following the independent review of the submitted assessment, a number of options and varying proposals have been ‘tested’ however again the outcomes would all result in an overall loss.

 

The Developer Contributions SPD sets out the relative infrastructure priorities where a viability assessment has been submitted. As such, in accordance with the Developer Contributions SPD, a deed of variation to the original Section 106 is proposed which removes the contributions to priorities 2b, 2c and 3 in lieu of a contribution to off-site affordable housing provision (priority 2a) – approximately £43,185.04. The contribution towards Education provision (priority 1) will be retained.

 

Whilst the provision of affordable housing provision is a key priority, the submitted viability assessment has been independently reviewed in detail. The conclusions of which demonstrate that the site would result in an overall loss should on-site affordable housing provision be provided.

 

Given that the development is currently being developed and circumstances may change within the construction market, a clause within the deed of variation is proposed securing a ‘late stage review’ of the viability position. This is in line with section 3.5.5 of the Affordable Housing and Housing Mix SPD – ‘Viability Reviews (clawback) and deferred payments’. This is considered reasonable to place on the permission to ensure that a further viability review is undertaken which would be based on actual sales values and known build costs.

 

Therefore, it is recommended that the application is permitted.

 

(There was a short adjournment before the next application was considered.)