Infrastructure charges and service delivery - the gap widens
16 September 2011
Legislation introduced by the State Government in May which caps infrastructure charges is already having an impact on Council budgets and the resources of infrastructure providers, particularly in relation to residential development.
Some infrastructure providers are being left with a significant shortfall, as the gap between the new infrastructure charges and the actual cost of delivering infrastructure widens.
Infrastructure charges no longer reflect the costs of delivering infrastructure, and are more akin to a tax. Infrastructure providers face the challenge of identifying alternate funding sources to plug the gap or further reduce their capacity to deliver and upgrade community facilities, services and amenities such as parks, sporting grounds and community buildings.
They are also under increasing pressure from developers and the State Government, to process development applications quickly and cheaply. At the same time, developers are identifying various strategies to exploit the benefits of the new charging regime and optimise their development proposals.
The increasing use of complex infrastructure agreements, along with a renewed focus on resolving longstanding appeals through the Planning and Environment Court, threatens to further stretch resources.
The diverse range of infrastructure agreements available, coupled with demands from developers, means negotiating and preparing infrastructure agreements can consume significant time and resources that could be best used elsewhere in the organisation.
One of the measures worth considering is investing in a template infrastructure agreement, or an appropriate suite of templates, prepared with the advice of lawyers with expertise in this area.
This can help ensure infrastructure is efficiently and effectively delivered, while reducing the administrative burden on town planning and engineering staff, leaving them available for other tasks.
For more information contact: Kristie Fankhauser on +61 7 3233 8876.