MAV Rural Land Use Planning Forum Development Contributions Plan - Tips and Ideas

1. MAV Rural Land Use Planning Forum Development Contributions Plan - Tips and Ideas Leah Wittingslow 15 March 2013

2. Changing Role of DCP’s • Origins in Eddie Barron case in absence of clear parameters for imposition of requirements via planning permit conditions • Collect funds for ‘shared’ infrastructure items including; • Open Space • Road upgrades and intersections • Drainage • Community Facilities DCP Advisory Committee standardisation of DCP’s Past Present Future

3. Why there is need for review of the DCP system • DCP system generally not well taken up – some of the many reasons include: • Lack of robust strategic justification - costly • Complex methodologies that seek to apply precise mathematical models (to address user pays principles) to imprecise planning contexts • Requirement for planning authority to accept responsibility for delivery of projects • External apportionment concept being exploited to open up funding gaps • Escalating project costs and associated liabilities • Threat of legal challenge • Uncertainty regarding applicable definitions • Tension between Council desire to fund increasing project list and developer attempts to reduce costs

4. StandardDevelopment Contributions Advisory Committee • Chair – Kathy Mitchell • Members Prof. Rodger Eade, Trevor McCullough, Bryce Moore, Chris De Silva • Assisted by Andrew Natoli, Jessica Cutting • Recently undertook extensive consultation • Over 50 very comprehensive submissions received • First report ‘Setting the Framework’ has been released • Second report dealing with contribution rates due mid-year

5. Current DCP system- Types of Infrastructure • Development Infrastructure • to be collected pursuant to a condition placed on a planning permit (usually at the time of subdivision) • Community Infrastructure • to be collected at the time of construction of a dwelling (issue of a Building Permit). Capped at $900 per dwelling) The Planning and Environment Act specifies two types of infrastructure: The Act does not define what is included or can be funded within each of the definitions In response to on-going uncertainty regarding which definition should be applied, in accordance with section 46M of the Act, the then Minister issued a Direction on 15 May 2003 to clarify what items can be funded from within the uncapped development infrastructure definition Since that time, the Minster issued a revised direction on 25 January 2012 which states that; the responsible authority must not impose a development infrastructure levy or a community infrastructure levy in respect of the development of land for a non-government school.

6. The Act and Relationship to the Guidelines • The following works, services or facilities may be funded from a development infrastructure levy: • Acquisition of land for: • Roads • Public transport corridors • Drainage • Public open space, and • Community facilities • Construction of roads, including the construction of bicycle and foot paths, and traffic management and control devices. • Construction of public transport infrastructure, including fixed rail infrastructure, railway stations, bus stops and tram stops. • Basic improvements to public open space, including earthworks, landscaping, fencing, seating and playground equipment. • Drainage works. • Buildings and works for or associated with the construction of: • A maternal and child health care centre • A child care centre • A kindergarten, or • Any centre which provides these facilities in combination

7. The Act and Relationship to the Guidelines • To assist Planning Authorities and others in formulation of DCPs guidelines were prepared in June 2003 and amended in March 2007 • The Guidelines do not have statutory weight but nonetheless contain some useful information regarding ‘the appropriate and practical application of the development contributions system’ • DCPs must have a strategic basis • Justification of Infrastructure projects (need) • Nexus between new development and the need for new infrastructure • DCPs must have a reasonable time horizon • Infrastructure costs must be apportioned on the basis of projected ‘share of usage’ • A commitment to provide the infrastructure • Accountability • Transparency • DCP must be in the planning scheme

8. Four Principles of a DCP Need Nexus Equity Accountability

9. Need

10. Nexus

11. Equity

12. Accountability

13. The role of a DCP in the Planning System Planning Tool Strategic Justification Development Context Delivery Mechanism Development Contribution Plans (incorporated into Planning Scheme) Infrastructure Funding apportionment embedded in DP Section 173 Agreement Higher Order Structure Plan (e.g. Incorporated Documents) Development Plan Permit Application High level of strategic justification – likely to be extensive list of projects Area specific – limited range of projects Site specific – few projects Large Growth Area Medium Development Area Smaller infill site

14. Keys to success Need and Nexus

15. Approach toward justification clearly influenced and informed by development context • Careful regard to likely implementation issues from the outset • Implementation strategy advanced early in process Context and Justification

16. Keys to Success • Adopt an holistic approach • Spend time to gain a well developed understanding of the development conditions that you are dealing with – both landform and developers • Develop digital map bases where possible • Be deliberate from the outset in defining planning units to support infrastructure needs analysis and apportionment • Understand your market conditions • Do not prepare development contributions plans in isolation – they are not planning instruments in their own right • Remove as much uncertainty as is possible • Identify land costs separately with site specific valuations wherever possible • Include separate robust indexation methodologies for land and construction • Cap/ fix land values

17. Keys to Success • Consider implementation in formulation of the DCP • Use user pays apportionment methodologies to establish need etc but thereafter focus on practicalities and realities of infrastructure funding and delivery • Don’t delay action – irrespective of possible changes to system strategic thinking will always be required • Look to best practice – submissions, resources available to committee • Develop cross-Council governance arrangements and internal confidence • Choose the right tool • Don’t be afraid to ask!