Developers building in Sheffield are set to donate up to £17 million to community projects in the next five years.
Sheffield Council chiefs are being recommended to adopt the Community Infrastructure Levy – a tariff levied on new buildings and extensions.
The money can be used towards infrastructure projects such as new road schemes, schools, parks, transport, health facilities or flood defences.
Reports from officers to council cabinet members ahead of a meeting on Wednesday say fees will be charged on developments given planning permission from this July, generating between £11.3m and £17m by the end of 2019-20.
Simon Green, council executive director of place, said: “We are expecting an annual income of £3 m to £4m from this scheme once it is established.
“This income will be generated through economic growth and reinvested into the city’s infrastructure.”
The council says ‘most’ of the money will be spent on infrastructure needed as a result of the particular new development.
However, the cabinet reports say the money does not all have to spent in the neighbourhood where the development is built.
A minimum of 15 per cent will be allocated to those communities, but the report says money can be ‘spent wherever it is most needed’.
In neighbourhood areas in Stocksbridge, Dore and Broomhill, Endcliffe and Tapton, a quarter of the money received will have to be spent there once neighbourhood plans are in place.
Such levies are used nationally and developers would have to pay between 1 per cent and 2 per cent of development costs.
In Bristol, money raised through the scheme has been spent on public transport schemes.
The levy will largely replace individually negotiated agreements with developers known as Section 106 agreements – and the council says it will be ‘faster, fairer and more transparent’.