Friday, July 5th, 2019 5:50am By Daniel Clark Share on Facebook Share on Messenger Share on Messenger Share on Twitter Share on Whatsapp Developers get a discount for building them Exeter City Council’s policy of offering discounts to developers of student accommodation in the city has cost the council almost £1 million, it has been claimed. The Exeter Green Party are calling for a review of student accommodation after uncovering the ‘lost million’. Exeter City Council’s current Community Infrastructure Charging Levy (CIL) applies a 50 per cent ‘discount’ on levy fees compared to domestic construction. They charge a levy of £80 sqm for residential accommodation but only £40 sqm for student accommodation. Cllr Diana Moore, the Green Party councillor for the St Davids’ ward said that in her ward alone, developers have only been charged £938,000 compared to almost £1.876 million if the levy had been applied at the same rate as residential construction. She will table a motion on behalf of the Progressive Group at the next full Council meeting calling for the council to scrap the current discount applied to student flats developers. She said: “The current charging levies are not fit for purpose. Developers have walked away with huge profits while what they pay through the levy structure has failed to provide the local infrastructure necessary for such developments. “A new charging structure which abolishes the 50 per cent lower rate for student developments is long overdue. Given the significant and vibrant contribution students make to life in Exeter, it would be reasonable that a new form of relief be applied, but only where truly affordable accommodation is to be provided. We need affordable homes for all young people in the city.” She added that the a policy offering discounts to developers of student accommodation in the city has lost the council almost £1 million. Liberal Democrat Cllr Kevin Mitchell, who is seconding the motion, added: “Measures to try and bring Houses in Multiple Occupation back into use as family homes have failed. Therefore, there is no justification for the current reduced levy for all forms of Purpose Built Student Accommodation to continue.” Cllr Jemima Moore added: “The upcoming review of student accommodation policy by the council must bring an end to the incentives to developers to build luxury student accommodation, which is unaffordable for many students” The motion says that the council welcomes the review of its current Student Accommodation policy for the city and that the current CIL charging statement was adopted for Exeter on October 15, 2013. It adds: “The rapid construction since this date of purpose built student blocks particularly in the city centre wards has already bought forward a 8,017 bed spaces and 2,802 are currently in construction. “That while developers have enjoyed a discount on the CIL levy compared to housebuilders, a significant number of the student accommodation been priced and marketed as ‘luxury’ accommodation. These are not affordable to many students nor do they help achieve the council’s goal of encouraging students to take advantage of this accommodation rather than in Houses of Multiple Occupation. “The council therefore resolves that the the CIL charging schedule rate for Purpose Built Student Housing no longer serves a useful purpose and has a disproportionate effect on the city centre wards of the local plan area. The council should bring forward a new charging schedule as soon as possible to replace the current schedule, and that a new charging schedule will no longer apply a lower charging rate of CIL to purpose built student housing compared to residential charging. “And that until such time a new Charging Schedule is adopted by the Authority Section 106 agreements are put in place on PBSBs to make such developments acceptable in planning terms. These agreements must include specific benefits for the local community, and may be up to the equivalent to the CIL levy contribution for an equivalent sized residential development.” It comes as next Tuesday’s Exeter City Council executive meeting is recommended to initiate a review of the Council’s Community Infrastructure Levy Charging Schedule. The report of Bindu Arjoon, Director, says: “The council’s CIL Charging Schedule came into effect on December 1, 2013, at the back end of a recession caused by the Global Financial Crisis. The viability evidence that underpinned the Charging Schedule dates from 2013 and preceding years. Development was a riskier and more challenging proposition at this time. “Although there are current economic uncertainties, it is considered prudent to undertake a review of the Charging Schedule, (bearing in mind the process can currently take 18 months to two years from start to finish). This is because it is anticipated that development viability, in which CIL rates must be grounded, has improved in some particular respects since the Charging Schedule was first prepared. “There is an option not to proceed with reviewing the CIL Charging Schedule, but it is considered prudent to initiate the process to take account of changing economic circumstances.” Exeter City Council did not respond to request for comment on Cllr Diana Moore’s claims of the lost million.
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