All residents living on licensed residential parks are required to pay a monthly pitch fee, it will vary considerably from park to park and even within a park, there appears to be no agreed basis for calculating the pitch fee but there are strict rules for increasing it.
The pitch fee can only be increased once a year on or after the pitch fee review date contained in the pitch agreement. The site owner must serve a written notice to all residents at least 28 days before the review date setting out his/her proposals for the new fee. The notice must be accompanied by an 8 page pitch fee review form, prescribed in law and detailing the formula used to calculate the new fee. The pitch fee notice is invalid without the review form meaning the site owner will be unable to make any changes to the fee until a valid notice is received.
The review notice can be issued late but it must always allow a 28 day notice period before the new fee is implemented. The new pitch fee is calculated by applying the Retail Price Index (RPI) in England or the Consumer Price Index (CPI) in Wales to the current fee together with any recoverable costs and deductions. The official RPI or CPI can be checked at www.ons.gov.uk. The figure used will be the rate that applied 28 days before the review date.
Recoverable costs can include park improvements, however before these can be included the site owner must have consulted about the improvements which should be for the benefit of residents and they can only be passed on if the majority of residents did not disagree in writing. Deductions relate to a deterioration in the site that has occurred since 26 May 2013 and which has not been taken into account in previous reviews. The site owner cannot include legal fees, fees for altering licence conditions or consent to transfer a site licence, local authority enforcement action or costs for expanding the site.
A park home resident is not obliged to accept the proposed increase, they can carry on paying the current fee withholding the increase. In this case either party can make an application to the First-tier Tribunal for a determination of the new pitch fee. This should be done within 3 months of the review date. If the increase is upheld the resident will have to pay the element withheld.
For more information on this subject contact The Leasehold Advisory Service (LEASE) on 020 7832 2525