Development Contributions – Changes to the Regime

by | Feb 17, 2015 | Subdivisions

In August last year the law relating to development contributions changed. They were aimed at making the regime easier to navigate and the costs easier to predict. A New Zealand Law Society seminar outlined the changes. Here are some pointers to take from the presentation:

• the purpose of the development contributions is to enable the recovery of a fair proportion of the capex needed to service the resulting growth;

• allocation of that cost should relate to who will benefit and who caused the need for the spend;

• Council can group development contributions in catchments but they must consider practical and administration efficiencies and fairness and they must avoid district wide catchments where practical;

• community infrastructure that can be funded by development contributions is now limited to community halls, playgrounds and toilets;

• no development contributions for reserves can be imposed for non-residential developments (unless they are hotels or motels);

• the relevant date for ascertaining the development contribution requirements is when an application for consent is lodged;

• a developer can ask for the development contribution to be re-assessed if there have been errors in the calculation and Council must consider the re-assessment within 15 working days;

• a formal process now exists for making objections if the developer considers Council’s decisions have been made on the wrong basis. The objections are determined by experienced government appointed commissioners whose decisions must be made in accordance with specified guidelines;

• Council must keep a schedule of assets for which the development contributions will be used;

• development contributions may be increased by reference to the producer price index;

• contributions are now payable when a certificate of acceptance has issued under section 98 of the Building Act 2004;

• the changes expressly allow for development agreements between developers and Council and sets out a clearer process for reaching those agreements.

By Debra Dorrington