Harrogate Borough Council has held onto almost £4 million of unspent money given to it from housing developers for social and community projects.
The Section 106 cash is agreed during planning talks to offset the impact of new housing and is intended to be used for improvements such as village hall refurbishments and new sports facilities.
More than £613,000 was spent on projects during 2020/21 – and the council has been praised by some communities.
But with around £3,730,000 unspent at the end of that period, there are concerns that many residents are not feeling the benefits at a time when the construction of hundreds of new homes is piling pressure on the need for community facilities.
Residents left with no community improvements
John Hansard, a member of Kingsley Ward Action Group, said the area faced the construction of around 700 new homes but residents have had “nothing at all” in terms of community improvements.
He said:
“Some of this money needs to come our way.
“Harrogate can’t cope with much more new housing and to think they want to build an extra 700 homes in our area is absolutely crazy.”
Tim Ellis, who also lives in the Kingsley ward, added:
“There is no community hall, no church halls and not even a pub any more, therefore nowhere local groups can have meetings.
“With all the new housing destroying the last of the fields, and new houses having tiny gardens, we will need a public park.
“The triangle of meadow and trees to the east of Kingsley Farmhouse bordering Kingsley Road would be ideal… but greedy developers are threatening to put houses even on this.”
Most of the money spent by Harrogate Borough Council during 2020/21 was on the purchase of affordable housing.
Cllr Tim Myatt, cabinet member for planning at the council, described the funding as a tool to “support future communities across the Harrogate district” and said other projects included new play areas and open space.
He also said the authority helped North Yorkshire County Council secure around £1.2 million in the last year for improvements to roads, sustainable travel and schools.
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But when questioned by the Local Democracy Reporting Service, the county council did not say how much unspent money it has held onto.
A county council spokesperson said Section 106 money has a “significant lifespan” and that the funds will be used for their intended purpose “at the appropriate time”.
Call for review of section 106 contributions
Harrogate Borough Council said it was “not unusual” for the authority to have large sums of unspent money and there were several reasons why this is the case.
It said the money is sometimes paid in instalments and cannot be spent until it has all been received. It also said parish councils often ask for the money to be saved up for larger projects.
Despite this, Cllr Pat Marsh, leader of the opposition Liberal Democrat party, said the almost £4 million unspent by Harrogate Borough Council “does seem a lot” and has called for more regular reviews of how the money is spent.
The council also collects cash through Community Infrastructure Levy contributions, which are another type of charge on new housing.
These work on a pounds-per-square-metre basis and because of recent changes to Harrogate Borough Council’s charging schedules no contributions were collected during the last financial year.
It is now intended that a review will be carried out to develop a list of spending priorities and projects.
Cllr Myatt added:
“Payment of CIL is due upon commencement of development, therefore there will be a time lag of up to two years before the first CIL contributions are received.
“In the future, the CIL will provide us with a pot of money so that we can work with local communities and partners to provide the right infrastructure in the right places to support development and the continued growth of the Harrogate district.”
Housing developers in the Harrogate district will have to pay more money for schools, doctors surgeries and roads after the council identified a £98m infrastructure shortfall.
Harrogate Borough Council will introduce a Community Infrastructure Levy (CIL) in October to complement Section 106 agreements that are agreed between the authority and developers.
Both are designed to pay for infrastructure that might be affected by new housing. For example, as part of a recent planning application for 170 homes on Kingsley Road, Harrogate High School asked for a Section 106 contribution of £307,435.
Unlike Section 106, CIL contributions will be calculated by floor space, meaning a housing development in central Harrogate, Knaresborough or Ripon would be charged up to £50 per square metre. Developments outside of town centres will not be subject to CIL charges.
Retail developments would also be subject to CIL contributions of up to £120 per square metre.
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Harrogate Borough Council published its long-awaited Local Plan in March that includes a pipeline of over 13,000 new homes from 2014 to 2035 across the district.
To introduce the CIL, HBC has to demonstrate to central government there is a shortfall in funding between the cost of infrastructure needed to support development – which the council has estimated is over £98m over the next 15 years, including £42m for schools.
HBC will publish a list of infrastructure it intends to fund via CIL before the end of 2020.
A parish or town council with an adopted neighbourhood development plan will be eligible to receive 25% of the CIL receipts generated.