What are Section 106 Planning Agreements?

There really is a very short way to explain what Section 106 Planning agreements are but by nature of their inherent complexities, in the end a longer explanation is usually required. In short a Section 106 agreement is a separate contract that's included in on a larger contract on a land development approval scheme in the UK.

Now that sounds pretty simple doesn't it? You see with the older way of doing things, prior to the enactment of the legislation that made Section 106 law, a developer either received a “thumbs up” or a “thumbs down” form a local community planning commission regarding plans for a new project. That was it!

Back then local community leaders simply didn't have the authority to go to a developer and ask or require them to, say build a park, or an affordable housing complex as a “contingency” for being approved. In deed if they tried it back then it could be seen as perhaps some type of extortion or even a corrupt action.

Now however, since the enactment of Section 106 legislation, not only is it “perfectly legal” and acceptable for community planners to put these types of proposals on the table as a requirement for approval of a land development project, but it's now part of the regular process. That is a developer in the UK can “without exception” now expect to field these types of requests.

So that sounds pretty simple doesn't it? If you're a developer you have to put some affordable housing down at the end of some road so they'll approve you on your grander plans for a gated community of high end homes nestled around a golf course. Well hold on because it in fact it gets even more complicated.

For instance provisions of the Section 106 allow for “folks” other than the people on the planning commission to weigh in and actually have a seat at the table and “a voice” in the negotiating process. So then what kind of “folks”? Well for instance elected officials like the mayor of the town that a proposed development is to be located now have a voice in the matter.

Now that sounds simple enough. You just have a few more people sitting at the table to talk to during the permit process if you're a land developer in the UK. Well the fact is that it can get even far more complicated if you toss in that perhaps an election is going on and that some of the folks sitting at the table are at polar ends of the local political spectrum.

What this is all leading to, is the resultant rise in popularity amongst land developers in the UK of a new genre of consultant service. A service that in effect handles Section 106 negotiations at the behest of a developer or group of developers who are seeking approval of a project. These are negotiators who have experience and a thorough knowledge in and of the process and of the legislation's “intricacies and particulars”.