16 November 2009

CSS AIMS FOR CLARITY ON COMMUTED SUMS

CSS has published new guidance that aims to overcome long-standing controversy over the “commuted sums” mechanism through which developers are required to contribute to future maintenance of areas adopted by local authorities.

Commuted sums were provided for under the Highways Act 1980 as a payment in lieu of providing the facility. Payments can either be a lump sum or phased payments following set triggers. Contributions can be sought towards either physical provision, such as roads or landscaping, or social provision, such as affordable housing or provision of community facilities.

The use of commuted sums for future maintenance is not new, but there is considerable variation in their use and practice by highway authorities in relation to new developments. As a result, the mechanism has become unpopular with many developers.

The aim of the new CSS guidance document is to offer a transparent and consistent approach to commuted sums. It believes the clarity of approach should help remove the uncertainty and risk for developers at an early stage in the process.

Key recommendations include:

• Developers should establish an early dialogue with highway and planning authorities, preferably prior to land purchase and certainly before planning permission is submitted
• It is not considered appropriate to seek commuted sums where other specific sources of funding are provided to cover ongoing maintenance
• It is not considered appropriate to request commuted sums for ‘standard’ highway network, or street lighting, adoptions
• The process for determining commuted sums should be transparent, and collected funds should at least be ring-fenced to the maintenance of the highway network
• Highway authorities should look more flexibly at what assets they are prepared to adopt, and review the circumstances for which commuted sums will be sought
• Highway authorities should set up materials databases and look to share information (both regionally and nationally) on new materials and methods
• Final commuted sums paid should be calculated immediately before the development infrastructure is adopted, and the figure adjusted periodically throughout design and construction to accommodate any price fluctuations.

The wide use of commuted sums recognises fundamental changes in public expectations of new housing environments over the past 10 to 15 years. The use of enhanced materials and street design comes at the same time as moves to develop more constrained and challenging sites. This is turn creates issues for public adoption, notably the safety, maintainability and future funding of road layouts that vary from the norm.

These challenges often lead to the introduction of higher levels of maintenance and may also involve additional features such as retaining walls, and soakaways, which are often the only way to allow the practical development of the site but place additional burdens on future maintenance.

Matthew Lugg, Chair of the CSS Engineering Committee, said: “Increasing pressure on local authority budgets tends to preclude enhanced developments from being maintained to the appropriate standard unless payment is sought from the developer for the ‘extra-over’ costs involved.  On the other hand, it is not in the original spirit of commuted sums for an authority to ask for sums in excess of reasonable additional future costs.

“Our hope is that this new guidance will provide a transparent and consistent approach to the seeking of commuted sums and calculation of the amounts sought  This should help remove the uncertainty and risk for developers at an early stage in the process. It will also provide security to overstretched highway budgets.

He added: “This guidance aligns with the fundamental asset management principle of understanding whole-life costs. We hope it will be used in the spirit in which is it intended and that innovation is not stifled.  The aim is to reach a fair and amicable funding agreement and avoiding unnecessary conflict and litigation”.  

Ends

Media contacts

Daybreak Communications  0845 644 3845 

Barrie Hedges  07899 923756; barrie.hedges@daybreakcomm.co.uk

Michael Pullan  07789 886094; michael.pullan@daybreakcomm.co.uk

Notes to editors

• CSS (formerly the County Surveyors’ Society) represents local authority chief officers who manage some of the most pressing issues facing the UK today. Membership is drawn from all four corners of the United Kingdom with members responsible for three-quarters of the road network, two thirds of the land area and just under half the population of England and Wales. Operating at the strategic tier of local government, they are closely involved in crucial transport, waste management, environment, planning, energy and economic development issues.
• The new CSS guidance document “Commuted sums for maintaining infrastructure assets” can be downloaded here.