Waverley Council maintains opposition to proposed changes to developer contributions
29 July 2022
Waverley Council has unanimously adopted a Mayoral Minute instructing the Mayor to write to all NSW Upper House members and ask them to “categorically reject” the state government’s proposed developer contribution reforms which will dramatically reduce the Council’s ability to fund vital infrastructure for the Waverley community and unfairly burden NSW taxpayers.
The Council is opposed to the Environmental Planning and Assessment Amendment (Infrastructure Contributions) Bill 2021 in its current form, that if adopted, would see Waverley Council stand to lose an estimated more than $40 million in developer contributions over 10 years.
Developer contributions are paid to Council at the commencement of a development and contribute towards the cost of local infrastructure projects that will meet the additional demands it generates and benefits from. Councils use these contributions to help pay for local infrastructure projects such as playgrounds, sports fields, libraries and parks. These contributions are set at a percentage of the cost of the development and this is based on a long-standing principle of the existing planning system.
Waverley Mayor, Paula Masselos, said the proposed levy change could have a detrimental impact on our community if funds raised in Waverley are diverted elsewhere at the government’s discretion. She has been vocal about this since proposed changes were announced by the state government last year. Read more here.
“Developer contributions should be spent where they are raised, otherwise we run the real risk of playgrounds, local roads, community facilities, footpaths, and open spaces that are currently funded through developer contributions being delayed, unfunded or fully funded by Council,” Mayor Masselos said.
“I am also becoming increasingly concerned that the current Minister for Planning, Anthony Roberts MP, is supportive of these reforms, which clearly direct contributions by developers to State Government coffers.
“If the changes come into effect, Waverley Council could stand to lose over $40M in contributions over the next 10 years compared to what would be collected under the current system. The government has suggested that councils could increase rates to cover the gap which could be as much as $150 per household. I do not believe that our residents should have to bear the cost of the state government taking revenue that was raised here in Waverley.
“The only winner is the State Government - the reforms must be scrapped immediately. I call on the cross benchers and Labor members of the Upper House to unite to defeat this appalling piece of legislation. Our community would thank you."
The unanimous decision of Council at the July Council meeting was as follows:
1. Notes that:
(a) The previous Minister for Planning, Rob Stokes, MP, introduced a range of reforms to the developer contributions scheme in NSW.
(b) This Bill proposes to change the way developer contributions are paid, with a significant proportion proposed to be paid to the State Government to fund regional infrastructure in areas where the important connection between development and the provision of infrastructure does not exist.
(c) Community infrastructure, such as parks and playgrounds, local roads, community facilities, footpaths and open spaces, that is currently funded through developer contributions will either have to be delayed, unfunded or fully funded by Council rates.
(d) If adopted, it is estimated that Council would stand to lose over $40 million in developer contributions over 10 years.
(e) The Mayor wrote to the Minister in October 2021 protesting about this reform.
(f) The Minster for Planning had stated that councils would not be worse off, although there was limited detail on this.
2. Notes that the Upper House inquiry report was tabled on 10 August 2021, but as yet there has been no Government response. Minutes of Council Meeting 19 July 2022 This is page 6 of the Minutes of the Ordinary Council Meeting held on 19 July 2022
3. Requests the Mayor to write to all Members of the Legislative Council (Upper House) of NSW asking them to categorically reject the proposed developer contribution reforms, which will dramatically reduce Council’s ability to fund vital infrastructure for our community and unfairly burden taxpayers
In 2021, Local Government NSW (LGNSW), the peak local government body, reported that small LGAs could lose about $3 million per year while more than $1 billion could be lost for large government areas.
In July 2021, LGNSW made a draft submission into the Parliamentary Inquiry into the Bill, which was introduced into NSW Parliament with the NSW Budget.
In its submission, Local Government NSW said: “Councils have led their communities through the previous 18 month’s raft of disasters, headlined by the COVID pandemic. Ensuring councils have access to ongoing funding through infrastructure contributions will empower councils to drive a locally led economic recovery and help them create tens of thousands of new jobs for their communities”.
Mayor Masselos said: “This resonates with us at Waverley, given we are one of the most densely-populated local government areas in Australia and have been a focus of much of the pandemic”.
“We also continue to share the view held by LGNSW that councils need clarity on the many aspects of the Bill and the regulatory changes that will follow, which are currently unknown.
“Of significant concern is that the state government is proposing that these contributions are to be paid after the development has been built. This exposes Council to a great risk of default by developers, meaning we may never see the money”.
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