Update on developer contributions - 22 Jul, 2020

For new developments that require local infrastructure and services, Council may collect a developer/local infrastructure contribution to help fund the provision. Developer contributions may take the form of any or a combination of the below:

 

·         A monetary fee. This can either be a rate that is charged per dwelling or square metre, or a rate that is charged as a percentage of the estimated cost of the development. For most councils, the percentage is 1%, though it can be higher in selected areas. 

·       Dedicated land that is free of cost to Council. This land may be reserved for public purposes like recreation, conservation, and emergency services.

·       Construction of public amenities or services that may have been in the pipeline for Council. This is known as “works-in-kind”.

 

Dedicated land and works-in-kind can offset or partly contribute to the monetary fee that developers would otherwise be expected to pay. Developer contributions are essential in helping councils to deliver more liveable communities through the provision of open space, footpaths, cycleways, roads, and stormwater management.

 

 

Amendments to Developer Contributions in response to COVID-19

 

As of July 2020, changes to developer contributions outlined in the Environmental Planning & Assessment Act 1979 (EPA Act) have sought to support the productivity, investment, and community wellbeing during COVID-19.

 

Unless directed otherwise, up until 25 September 2020, developer contributions can be deferred until an occupation certificate has been issued. This should alleviate financial pressures resulting from the pandemic, however, recent amendments under the Environmental Planning and Assessment Regulation 2000 (EPA Reg) do require certifiers to prove that developer contributions have been made prior to issuing an occupation certificate.  More information on this amendment can be found here.

 

Further, from May 2020, funds obtained from developer contributions can be consolidated within and between contribution plans regardless of any restrictions outlined in the plan. This is expected to increase flexibility and stimulate growth for councils by expediting infrastructure projects. More information on this amendment can be found here.

 

 

Further Information

Any queries or concerns with the method of collection or administration of developer contributions can be directed to the local government body. Additional information can also be found on the NSW legislation website:

 

·         Part 7 Division 7.1 of Environmental Planning and Assessment Act 1979

·         Part 4 of Environmental Planning and Assessment Regulation 2000