Community Infrastructure Levy (CIL) ‘Payment in Kind’

The Community Infrastructure Levy (CIL) Regulations 2010 (as amended) address the concept of "payment in kind" in Regulations 73, 73A, and 73B. These sections allow charging authorities (such as local planning authorities) to accept infrastructure or land as payment in lieu of some or all of a developer's CIL liability.

Here's a breakdown of the relevant sections:

1. Regulation 73: Payment in the Form of Land

• This regulation enables charging authorities to accept land transfers instead of monetary CIL payments.

• The land must be used to support the delivery of infrastructure needed to mitigate the impact of the development.

• The developer and charging authority must agree on the value of the land, which is credited against the CIL liability.

  
  

2. Regulation 73A: Provision of Infrastructure as Payment

• Introduced in later amendments, this regulation allows developers to provide physical infrastructure instead of paying CIL in cash.

• For example, a developer might construct a school, road, or park as part of the agreed payment in kind.

• The infrastructure must be something that the CIL would otherwise have funded.

• Both parties must agree on the terms, and the infrastructure's value is offset against the developer's CIL liability.

  
  

3. Regulation 73B: Process and Agreements

• Regulation 73B outlines the administrative process for accepting payment in kind, including:

  • The need for a formal agreement between the developer and the charging authority.

  • The authority's obligation to ensure the land or infrastructure provided meets the relevant requirements.

  • A valuation process to determine the contribution's equivalence to the CIL liability.

Practical Application

These provisions are designed to:

1. Encourage Flexibility: Developers can deliver infrastructure directly, potentially speeding up its availability for the community.

2. Enhance Local Benefit: By accepting land or infrastructure, authorities can ensure contributions are closely aligned with local needs.

3. Reduce Financial Barriers: Payment in kind can ease developers' cash flow issues, particularly for large or complex projects.

   
   

CIL 'payment in kind' can reduce financial barriers to development