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Using Section 106 Agreements and Unilateral Undertakings to secure Planning Obligations

The purpose of this information is to help you understand what ‘Planning Obligations’, ‘Section 106 Agreements’ and ‘Unilateral Undertakings’ are.

Community Infrastructure Levy (CIL) and S106 Agreements

From April 2015 the use of S106 Agreements by Dudley Council will be limited to securing Affordable Housing and any specific on-site requirements which will be determined on a site by site basis.

The Government has introduced a new charge called the Community Infrastructure Levy (CIL) to replace Planning Obligations / S106 Agreements in part. CIL was adopted by Dudley Borough in 2015.

From the date CIL was adopted by Dudley Council it will apply to certain residential and retail planning permissions which first permit development (i.e. where the date of the decision notice is on or after the date of adoption of the Dudley CIL)

If your proposed development is likely to be CIL Liable you are required to submit a completed Community Infrastructure Levy Additional Information Form which is available on the Planning Portal. This is so that we can calculate the amount of CIL accurately.

For more information please refer to the below website. If you require further information please email us through the general contact form at the bottom of the page or call 01384 814136

What is a Planning Obligation?

As part of the planning process, a developer may be required to enter into a legal agreement to provide infrastructure and services on or off the development site where this is not possible to achieve through planning conditions. These agreements are known as Planning Obligations and are a delivery mechanism for the matters that are necessary to make the development acceptable in planning terms.

Such agreements can cover almost any relevant issue, acting as a main instrument for placing restrictions on developers, often requiring them to minimise the impact on the local community and to carry out tasks which will provide community benefits, and can include the payment of sums of money.

They are commonly used to bring developments in line with the objectives of sustainable development. Examples of types of infrastructure or services that planning obligations can include are:

  • Highway Improvements

  • Provision of Affordable Housing

  • Improved community facilities – e.g. Public open space/ play areas, educational facilities 

  • Specific measures to mitigate impact on a local area – e.g. parking restrictions, landscaping or noise insulation.

  • Restrictions and obligations on the use of land.

This list is not exhaustive. Each planning application is dealt with individually on its merits and restrictions and requirements not on this list may also be needed.

Planning Obligations Supplementary Planning Document

The Council’s approach to planning obligations is set out in Policy DEL1 ‘Infrastructure Provision’ of the Black Country Core Strategy and further detail on the implementation of this policy is provided in the Planning Obligations Supplementary Planning Document (SPD). This document provides guidance on the principles and policy basis that guide the Council’s approach to planning obligations, and sets out a scale of standard formulae and charges that may be generated by a development. The SPD provides transparency which should help to inform developers about the costs of contributions when considering purchasing land, and help simplify and speed up the negotiation and agreement of obligations.

The Planning Obligations Supplementary Planning Document (September 2011) is available at the bottom of this page.

Section 106 Agreements and Unilateral Undertakings

Planning Obligations can be secured through either a Section 106 Agreement or a Unilateral Undertaking depending on the nature of the development.

Unilateral Undertakings

A Unilateral Undertaking is a simplified version of a planning agreement, which is relatively quick and straightforward to complete, and is entered into by the landowner and any other party with a legal interest in the development site. They can assist in ensuring that planning permissions are granted speedily, which benefits both applicants and the Council.

A Unilateral Undertaking will consist solely of the payment of financial contributions, of one or more of the types described in the template, to be paid prior to commencement of development.

The Undertaking includes on obligation to pay the Council’s costs in monitoring and managing the implementation of the planning obligation. The charge is subject to review, and is currently as follows:

  1. Where the S106 contributions are below £5000 then a flat rate charge of £250 applies

  2. Where the S106 contributions are between £5000 and £10,000 then a flat rate charge of £500 applies

  3. Where the S106 contributions are above £10,000 then a charge of £1000 or 10% of the planning fee (whichever is the greater) applies

Pre-Application Advice

The Council is committed to offering pre-application advice. Where a Unilateral Undertaking is required, you are advised to include this element in your pre-application discussions, so that the details and level of contribution can be agreed prior to the submission of a planning application. Once this information has been obtained the applicant is required to complete, sign and submit the valid Unilateral Undertaking at the same time as the planning application is submitted. As part of the Unilateral the applicant is required to provide proof of title to the land.

Upon receipt of the submitted Unilateral the Council will assess and determine whether it is valid. If it invalid then the applicant will be notified and required to submit an amended Undertaking.

How do I complete a Unilateral Undertaking?

Copies of the template Unilateral Undertakings can be downloaded below, there are two types of Unilateral Undertakings that can be used:

  • Unilateral Undertaking for Full Planning Application

  • Unilateral Undertaking for Outline Planning Application

Also available to download are Explanatory Notes which provide more detailed guidance for completing a Unilateral Undertaking.

Further information on Unilateral Undertakings can be obtained from the Council’s Principal Planning Obligations Officer on 01384 816489.

S106 Agreements

Where a planning obligation will not be covered by a Unilateral Undertaking, applicants will still be required to enter into a S106 Agreement. This type of legal agreement will need to be entered into by the applicant, the Council and anyone else who has in interest in the land forming the application site.

A S106 Agreement is normally a more complex type of planning agreement than a Unilateral Undertaking and normally takes longer and is more expensive to complete.

Pre-Application Advice

For both developers and the Council it is beneficial for S106 planning obligations to be covered in pre-application discussions where these take place. It provides an early opportunity to clarify the Council’s planning obligations policies in relation to the proposed development and for the applicant to raise any questions.

Investing time and resources at the pre-application stage can save time and resources and help speed up the delivery of planning obligations.