The Environment Agency (Levies) (England and Wales) Regulations 2011

• Citation: S.I. 2011/696
• Sections: 13

Section 1 Citation, commencement and application

(1) These Regulations—

(a) may be cited as the Environment Agency (Levies) (England and Wales) Regulations 2011; and

(b) come into force on 1st April 2011.

(2) These Regulations apply in relation to levies issued for any financial year beginning on or after 1st April 2012.

Section 2 Interpretation

In these Regulations—

“actual expenditure”, in relation to the area of a Regional Flood and Coastal Committee for a financial year, means the sum of the amount of levy revenue spent in that area in that financial year by the Agency in connection with the Agency’s—

flood and coastal erosion risk management functions in that area, and

administrative expenses, and research or related activities, for that financial year;

“the Agency” means the Environment Agency;

“area”, in relation to a Regional Flood and Coastal Committee, means the region for which the Regional Flood and Coastal Committee is established under section 22(1) of the Flood and Water Management Act 2010;

“constituent authority”, in relation to a Regional Flood and Coastal Committee, means a lead local flood authority (within the meaning given in section 6(7) and (9) of the Flood and Water Management Act 2010) any part of whose area is in the area of the Committee;

“flood and coastal erosion risk management functions”, in relation to the Agency, means the following functions exercisable by the Agency—

flood risk management functions within the meaning given in section 4 of the Flood and Water Management Act 2010, and

coastal erosion risk management functions within the meaning given in section 5 of that Act;

“levy” means a levy issued by the Agency to a constituent authority of a Regional Flood and Coastal Committee for a financial year in respect of the Agency’s flood and coastal erosion risk management functions in the area of the Committee;

“levy revenue” means revenue raised in the area of a Regional Flood and Coastal Committee for a financial year by a levy issued to constituent authorities in that area for that financial year;

“qualifying expenses” means the Agency’s expenses for the area of a Regional Flood and Coastal Committee for a financial year ascertained in accordance with regulation 8;

“Regional Flood and Coastal Committee” means a Regional Flood and Coastal Committee established under section 22(1) of the Flood and Water Management Act 2010; and

“relevant council tax base” has the meaning given in regulation 7.

Section 3 Issue of levies

(1) When issuing a levy to a constituent authority for a financial year, the Agency must specify—

(a) that part of the constituent authority’s area to which the levy relates; and

(b) the basis on which the levy is calculated.

(2) A levy (other than a levy issued under regulation 4) must be issued before 15th February in the financial year preceding that for which the levy is issued, but it is not invalid merely because it is issued on or after that date.

Section 4 Substituted levies

(1) If the Agency has issued a levy to a constituent authority for a financial year, originally or by way of substitute (“old levy”), the Agency may issue a levy in substitution for that levy (“new levy”).

(2) A new levy must not be greater than the old levy.

(3) But if the old levy is quashed because of a failure to comply with any of the requirements of Part 3, the new levy may be greater than the old levy by so much as is necessary to comply with those requirements.

(4) The Agency must treat anything paid towards an old levy as having been paid towards the new levy.

(5) If a constituent authority has paid more towards an old levy than the amount of the new levy, the Agency must—

(a) credit the excess against any future liability of the constituent authority to pay a levy to the Agency; or

(b) repay the excess.

Section 5 Payment of levies

(1) This regulation applies if the Agency has issued a levy to a constituent authority for a financial year in accordance with regulation 3 or 4.

(2) The constituent authority must pay the levy to the Agency at such time and in such manner during the financial year as may be agreed between the Agency and the constituent authority.

(3) In default of such an agreement, the constituent authority must pay the levy to the Agency—

(a) if the levy is issued on or before 30th April in the financial year, by four equal instalments due on 1st May, 1st July, 1st October and 1st January in the financial year;

(b) if the levy is issued after 30th April and on or before 31st December in the financial year, by equal instalments or (as the case may be) by a single payment due on as many of the dates referred to in sub-paragraph (a) as remain after the date of issue; or

(c) if the levy is issued after 31st December in the financial year, 30 days after the date of issue.

Section 6 Calculation of levies

(1) The Agency must calculate the levy to be issued to a constituent authority for a financial year in accordance with this regulation.

(2) Where there is one constituent authority of a Regional Flood and Coastal Committee, the levy to be issued to the constituent authority is the amount of the Agency’s qualifying expenses for the area of the Committee for the financial year.

(3) Where there is more than one constituent authority of a Regional Flood and Coastal Committee, the levy to be issued to each constituent authority is calculated in accordance with the following formula—

A × ( B C )

where—

A is the constituent authority’s relevant council tax base for the financial year,

B is the Agency’s qualifying expenses for the area of the Committee for the financial year, and

C is the sum of the relevant council tax bases for the financial year for all the constituent authorities of the Committee.

Section 7 Relevant council tax base

(1) The relevant council tax base for a financial year for a constituent authority of a Regional Flood and Coastal Committee is—

(a) if the constituent authority is a billing authority in England, the council tax base for the financial year for its levy area calculated in accordance with the 1992 Regulations ;

(b) if the constituent authority is a billing authority in Wales, the council tax base for the financial year for its levy area calculated in accordance with the Local Authorities (Calculation of Council Tax Base) (Wales) Regulations 1995 ;

(c) if the constituent authority is a precepting authority , the council tax base for the financial year for its levy area determined by—

(i) calculating, in accordance with the 1992 Regulations, the council tax base for the financial year for those parts of each billing authority’s area that fall within the levy area of the precepting authority; and

(ii) adding those amounts.

(2) In this regulation—

“levy area” means that part of a constituent authority’s area that is in the area of the Regional Flood and Coastal Committee; and

“the 1992 Regulations” means the Local Authorities (Calculation of Council Tax Base) Regulations 1992 .

Section 8 Qualifying expenses

(1) The Agency may ascertain its expenses for the area of a Regional Flood and Coastal Committee for a financial year (“qualifying expenses”) by—

(a) estimating the amount of relevant expenditure for that area for the financial year;

(b) subtracting from that amount any amount that will be funded by means other than a levy;

(c) if regulation 9 applies—

(i) adding to the remainder any amount calculated under paragraph (3) of that regulation that is to be carried forward to that financial year; and

(ii) subtracting from the remainder any amount calculated under paragraph (4) of that regulation that is to be carried forward to that financial year;

(d) if regulation 10 applies—

(i) adding to the remainder the sum of any amounts apportioned to constituent authorities in that area under paragraph (3) of that regulation that, under paragraph (4) of that regulation, are to be carried forward to that financial year; and

(ii) subtracting from the remainder the sum of any amounts apportioned to constituent authorities in that area under paragraph (3) of that regulation that, under paragraph (5) of that regulation, are to be carried forward to that financial year.

(2) In this regulation—

“the remainder” means the amount calculated under paragraph (1)(b); and

“relevant expenditure”, in relation to the area of a Regional Flood and Coastal Committee for a financial year, means—

any expenditure expected to be incurred by the Agency in that financial year in connection with its flood and coastal erosion risk management functions in that area, and

an amount determined by the Agency as representing a fair proportion of—

the Agency’s administrative expenses for that financial year, and

the amount to be spent by the Agency for that financial year for research or related activities.

Section 9 Carrying forward of balances for purpose of ascertaining qualifying expenses for an area

(1) This regulation applies in relation to the area of a Regional Flood and Coastal Committee unless, before 1st December in a financial year, the Agency revises the boundaries of the area in accordance with regulations made under section 22(2)(a) of the Flood and Water Management Act 2010.

(2) As soon as is reasonably practicable after the end of the financial year, the Agency must—

(a) calculate the difference (if any) between the actual expenditure in an area for a financial year and the sum of—

(i) the amount of levy revenue raised for that financial year, and

(ii) any amount carried forward to that financial year under paragraph (3) or (4); and

(b) provide the following information to the Regional Flood and Coastal Committee for the area and its constituent authorities—

(i) the actual expenditure of levy revenue in the area for that financial year,

(ii) the purposes for which the levy revenue was spent,

(iii) the sum of the amounts in sub-paragraph (a)(i) and (ii) for that financial year, and

(iv) any difference calculated under sub-paragraph (a).

(3) If the actual expenditure in an area for any financial year is greater than the sum of the amounts in paragraph (2)(a)(i) and (ii) for that financial year, the Agency may carry forward the amount of the difference to—

(a) the next financial year, if a levy for the next financial year has not yet been issued; or

(b) the financial year after the next financial year, if a levy for the next financial year has already been issued.

(4) If the actual expenditure in an area for any financial year is less than the sum of the amounts in paragraph (2)(a)(i) and (ii) for that financial year, the Agency must—

(a) carry forward the amount of the difference to—

(i) the next financial year, or

(ii) the financial year after the next financial year; or

(b) apportion the amount of the difference between each constituent authority in that area based on the proportion that the relevant council tax base for the financial year for each constituent authority bears to the sum of the relevant council tax bases for the financial year for all constituent authorities in that area, and pay those apportioned amounts to the constituent authorities.

Section 10 Carrying forward of balances following revision of boundaries

(1) This regulation applies if, before 1st December in a financial year, the Agency revises the boundaries of the area of a Regional Flood and Coastal Committee (“old area”) in accordance with regulations made under section 22(2)(a) of the Flood and Water Management Act 2010 to create new areas.

(2) As soon as is reasonably practicable after the end of the financial year, the Agency must—

(a) calculate the difference (if any) between the actual expenditure in the old area for the financial year and the sum of the amounts in regulation 9(2)(a)(i) and (ii) in relation to the old area for that financial year; and

(b) provide the information in regulation 9(2)(b) to—

(i) the Regional Flood and Coastal Committees for the new areas, and

(ii) any constituent authority in a new area which was a constituent authority in the old area (“the relevant constituent authorities”); and

(c) apportion the amount of any difference calculated under sub-paragraph (a) of this regulation between the relevant constituent authorities in each new area based on the proportion that the relevant council tax base for the financial year for each relevant constituent authority bears to the sum of the relevant council tax bases for the financial year for all constituent authorities in the old area (“apportioned amounts”).

(3) The Agency must—

(a) if the actual expenditure in the old area for the financial year is greater than the sum of the amounts in regulation 9(2)(a)(i) and (ii) for that financial year, carry forward the apportioned amounts in accordance with paragraph (4) of this regulation; or

(b) if the actual expenditure in the old area for the financial year is less than the sum of the amounts in regulation 9(2)(a)(i) and (ii) for that financial year—

(i) credit the apportioned amounts against any future liability of the relevant constituent authorities to pay a levy to the Agency,

(ii) pay the apportioned amounts to the relevant constituent authorities, or

(iii) carry forward the apportioned amounts in accordance with paragraph (5) of this regulation.

(4) If the actual expenditure in the old area for the financial year is greater than the sum of the amounts in regulation 9(2)(a)(i) and (ii) for that financial year, the Agency may carry forward the apportioned amounts to—

(a) the next financial year, if a levy for the next financial year has not yet been issued; or

(b) the financial year after the next financial year, if a levy for the next financial year has already been issued.

(5) If the actual expenditure in the old area for the financial year is less than the sum of the amounts in regulation 9(2)(a)(i) and (ii) for that financial year, the Agency may carry forward the apportioned amounts to—

(a) the next financial year; or

(b) the financial year after the next financial year.

Section 11 Anticipation of levy

(1) A constituent authority may anticipate that the Agency will issue a levy to it for any part of its area for a financial year if—

(a) the Agency issued a levy to it for that part of its area for the preceding financial year; and

(b) at the time the constituent authority makes its calculations for a financial year, the Agency has not issued a levy for that part of its area for that financial year.

(2) When making its calculations, a constituent authority must estimate the amount of any levy it anticipates.

(3) If a constituent authority makes any substitute calculations for the financial year, the amount of any levy it anticipates must be its previous estimate under paragraph (2).

(4) References in this regulation to a constituent authority’s calculations are references to calculations made under—

(a) section 32 (calculation of budget requirement) of the Local Government Finance Act 1992 , if the constituent authority is a billing authority; or

(b) section 43 (calculation of budget requirement) of that Act , if the constituent authority is a precepting authority.

Section 12 Requirement to notify Agency of relevant council tax base

During the period beginning with 1st December and ending on 31st January in a financial year, a billing authority must notify the Agency of its relevant council tax base if—

(a) before the beginning of that period, the Agency informed the billing authority or, if the billing authority is in the area of a precepting authority, the precepting authority in writing that it will issue a levy to the billing authority or precepting authority for the next financial year; or

(b) the billing authority or, if the billing authority is in the area of a precepting authority, the precepting authority anticipates that the Agency will issue a levy to it for the next financial year.

Section 13 Revocation and transitional provisions

(1) The Environment Agency (Levies) Regulations 1993 (“the 1993 Regulations ”) are revoked.

(2) Despite their revocation, the 1993 Regulations continue in force in relation to levies issued or anticipated in accordance with those Regulations in relation to a financial year beginning before 1st April 2012.

(3) For the purpose of ascertaining the qualifying expenses of the Agency in an area for the financial year beginning with 1st April 2012, the amount to be carried forward to that financial year under regulation 8(1)(c) or (d) is any excess or deficiency to be brought forward to that financial year in accordance with section 47(2) of the Land Drainage Act 1976 .

(4) For the purpose of anticipating a levy for the financial year beginning with 1st April 2012, the reference in regulation 11(1)(a) to a levy is taken to be a reference to a levy issued under the 1993 Regulations.