Agenda item

Report of the Assistant Director, Planning and Regeneration to recommend that the Hale Village s106 legal agreement signed in 2007 be revised.

TO FOLLOW

The Committee considered a report, previously circulated, which set out the background and current position, the proposed revisions to the s106 agreement, the potential benefits and implications of agreeing these s106 revisions and other relevant factors. The presentation of the report highlighted the key issues, and advised the Committee of the proposed amendments to the recommendations of the report, which were covered in the tabled addendum. The Committee was advised of the revisions proposed in the report, which included provisions that £2.6m would be paid within 21 days of signing the new agreement, with a further £0.5m to be paid within 4 months of the new agreement, phased payments of up to £2.647m linked to future land sales, 60% of sales overage receipts (subject to conditions) for the balance of up to £3.664m and proportionate liability for plot leaseholders. The revisions provided for up to £10.2m s106 contributions, indexed to November 2010. The Committee was advised that receipt of the contributions would be dependent on the performance of the housing market and that there was a risk that the full £10.2m would not be delivered. Officers felt that the current proposals, however, offered the best prospect of securing the optimum amount of contributions.

The Committee expressed concern that this would be an issue that was referred back to the Committee for further revision in future, and sought assurance that this would not be the case, in response to which officers advised that they were seeking an end to the renegotiations; it was felt that the proposed revisions offered the best chance of reaching a final agreement on this issue, enabling the development to move forward on a stable basis. The Committee asked about the position with the health centre, in response to which it was reported that the Core Strategy stated that this site should have a health facility, the applicant was committed to having a health facility on the site and construction of a building for a health facility was due to be completed within the year; the Council was meeting with the PCT on a quarterly basis to encourage them to occupy the site, however current changes to the NHS arrangements meant that this work would be ongoing.

The Committee asked whether agreeing the proposals would put the Council in a less favourable position than at present, in response to which it was reported that it was felt that this approach would give the Council the best chance of receiving the maximum level of contributions. In response to a question from the Committee, it was confirmed that any successive owners of the site would be bound by the Section 106 agreement. The Committee expressed concern that amounts owed to Anglo Irish Bank (AIB) and the Homes and Communities Agency (HCA), as mentioned in the report, might take precedence over s106 contributions to the Council, in response to which officers reported that, while detailed figures could not be discussed in public, the current projections indicated that, while repaying those loans did have to take priority, currently projected land sale receipts should still enable a large part of the s106 contributions to be paid, although this was dependent on the actual performance of the housing market. In respect of possible overage receipts, the Committee was advised that current estimates suggested that sales could exceed the trigger for the Council receiving overage payments, however this again depended on the performance of the housing market at the time the units were made available. In response to a question from the Committee regarding the terms of the debt owed to AIB, officers advised that this was not on an ‘all sums due’ basis and related only to the Hale Village Development.

The Committee asked about the previous decision to exempt leaseholders from s106 obligations in respect of particular plots, and it was confirmed that this decision had been made at an officer level in 2008; the proposed revisions to the s106 agreement  provide that all future owners would have proportionate liability. In response to a question from the Committee regarding the likely demand for open market housing on the site, with particular reference to the previous discussion regarding Block NW2, officers advised that the arguments regarding the low demand for open market housing related specifically to the NW2 plot, but that other areas of the development were felt to be more attractive for open market housing.

The Chair moved the recommendations of the report, as revised in the addendum report and it was:

RESOLVED

1)     That the reasons for needing to revise the s106 funding and other obligations set out in para 4.7 and the conclusion in Section 9 of the report be noted;

1)     That a Deed of Variation to the s106 agreement dated 9 October 2007 be approved or, alternatively, a new consolidated s106 agreement incorporating appropriate provisions of the original 2007 agreement and the two previous Deeds of Variation, relating to land at Hale Village, Ferry Lane, London N17 based on the terms as outlined in the report and in more detail in the heads of terms attached to the report and incorporating an agreement under s278 Highways Act 1980 to complete site access and junction improvements;

2)     That, following the Committee’s decision on 26 October 2010 to grant planning permission subject to a s106 legal agreement for two 10-storey residential buildings at Pavilions 1 and 2 in Hale Village (Appln. No. HGY/2010/1427), the incorporation into that agreement of the principle of proportionate liability for the Education, Transport, Local Transport Infrastructure and Bus Service Enforcement Contributions and for 50% of the Tottenham Hale Urban Centre Masterplan Contributions consistent with the proposed terms of the Deed of Variation / consolidated s106 agreement in Recommendation 3.2 be approved.

3)     That the Assistant Director (Planning and Regeneration) be authorised, in conjunction with the Head of Legal Services and in consultation with the Chair of the Committee, to finalise the detailed terms of the Deed of Variation / consolidated s106 agreement approved in Recommendation 3.2 and the  s106 agreement approved in Recommendation 3.3, including consequential and any other changes necessary to both following continuing negotiations and detailed drafting, and to approve the completion of those agreements.