("Planning No.1 Bill")
Planning No.1 Bill sets out proposals to address the housing supply shortage in Ireland and also to incentivise development of vacant and underutilised sites left behind by the boom.
The key provisions of Planning No.1 Bill are:
Amendments to Part V Requirements
Part V of the Planning and Development Act 2000 requires local authorities and in turn developers, to make provision for social and affordable housing in residential developments. The Planning No.1 Bill proposes to relax some of these requirements, to make developments more economically viable, while also, looking to maintain the principles of social integration underlying Part V. The amendments to Part V include:
- Narrowing the application of Part V, so it will now only apply to developments of 10 houses or more, as opposed to 5 previously.
- Reducing the obligation on developers to provide 20% of units for social and/or affordable housing, to an obligation to provide 10% of units for social housing only. The obligation to provide affordable housing is removed.
- Abolishing the option for developers to account for their social housing obligations through cash payments to local authorities.
- Obliging developers to provide the required social housing on site at the development. Off-site options will now only be allowed in exceptional circumstances.
Importantly, the new Part V arrangements will apply to existing planning permissions, so they will be of assistance to developments which have stalled in recent years.
Introduction of a Vacant Site Levy
This is a new measure, empowering local authorities to apply a levy on the registered owner of vacant or underutilised sites in urban areas, where the owner has failed to develop the site without good reason.
- The levy will be at an annual rate of 3% of the market value of the site, rising by 1% annually up to a maximum of 6%.
- Non-payment is an offence, with a fine of €5,000 on summary conviction.
- However, local authorities will have a reasonable degree of latitude not to apply the levy where is it satisfied that there are economic reasons, including "undue hardship" which has yet to be defined, infrastructural, technical, or other reasons to prevent commencement of the development.
Reduced Development Contributions for existing planning permissions
Development Contributions are charges levied by local authorities on developments in respect of use of public infrastructure. The rate for Development Contributions is normally fixed at the date of grant of planning permission. This new measure means that if the rate for contributions is subsequently reduced by the local authority, the reduced rate will be applied to existing planning permissions, again, easing the burden on stalled developments.
"Use it or lose it" provisions – for planning permissions
Developers will now be obliged to provide a development schedule when applying for planning for 10 houses or more. If the development is subsequently not progressed in accordance with the schedule, without reasonable justification, local authorities will be empowered to modify or reduce the duration of the planning permission granted.
Need for Action on Housing
According to the Government, Planning No.1 Bill is part of a multi-faceted approach to address housing supply problems in Ireland.
Some of the proposals may be controversial, in particular, the removal of the obligation to provide affordable housing in developments. However, given the virtual standstill in house building at the moment, it is difficult to argue with the Government's logic of seeking to increase the number of units built generally. The intent of the changes is to increase the availability of housing and social units. It remains to be seen if the principles of social integration underlying Part V will be upheld as the housing market begins to recover.
No doubt there will be differences between developers and local authorities on the meaning of "undue hardship" and "reasonable justification" for not progressing with a development. We will keep you updated on how these terms are ultimately defined and on the Bill's progress through the legislative process. In Oireachtas debates, the Government has made it clear that it is anxious for Planning No.1 Bill to be enacted as soon as possible.
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