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How do contributions fit into the development process

The infrastructure needed to support new homes and communities is identified when land is rezoned, or sometimes earlier.

 

At this point, contributions plans are prepared and allow the State and Local Government to levy a contribution towards the infrastructure needed.

 

The amount of the contribution that needs to be paid is a condition of approval for a development.

 

Payment occurs when the land is finally subdivided or certificates issued to start construction.

 

infrastructure_contributions-chart_834x224

 

Special infrastructure contributions (SIC) Local Infrastructure contributions (S7.11 and S7.12)

Roads (state and regional)

Land for:

  • Hospitals
  • Schools
  • Parks and environmental conservation
  • Police, fire and ambulance facilities

Planning and delivery of new urban areas.

Local roads

Traffic management

Drainage

Open space

Community facilities:

  • Libraries
  • Community centres

Plan administration.

Improving VPAs

Development contributions help cover the cost of delivering infrastructure needed to support new communities and homes.

 

They are about making sure that developers and businesses are paying their fair share towards the infrastructure needed to support new homes.

 

The development contributions system operates under the Environmental Planning and Assessment Act, 1979.

 

This system covers contributions for both state/regional (Special Infrastructure Contributions or SIC) and local infrastructure (Section 7.11 and Section 7.12 contributions), as well as the ability to negotiate planning agreements directly with individual developers for the provision of infrastructure.

Satisfactory arrangements and planning agreements

Planning agreements are commercial agreements entered into by a developer and the Minister for Planning, other Ministers or council.

 

They can cover a variety of issues but most commonly address at least one of the following:

  • Public amenity and public service
  • Affordable housing
  • Transport
  • Other infrastructure

They can require either the physical provision of the above or a monetary contribution towards their provision.

 

Satisfactory arrangements

The majority of planning agreements entered into by the Department relate to satisfactory arrangement clauses in a Local Environmental Plan. These clauses require ‘satisfactory arrangements’ to be made for the provision of state and regional infrastructure before the land can be developed for urban purposes.

 

At a glance…

  • There are over 90 state planning agreements in force across NSW securing contributions of more than $1 billion towards infrastructure
  • The Department has a Voluntary Planning Agreements (VPA) register that lists all current planning agreements which the Minister is a party to (individual councils should have a similar register where they are party to an agreement).

 

Go to the VPA Register

Preparing a planning agreement

If you think your development might need a planning agreement to contribute towards state infrastructure, talk to us as soon as possible.

 

These agreements are legal documents and you will be required to meet the cost of their preparation. Contact the Department.

Works-In-Kind agreements

Where a SIC is in place a developer may want to construct infrastructure instead of paying a cash contribution. If they want to do this they will need to enter into a Works-In-Kind (WIK) agreement. A WIK agreement is a legal agreement between the development and the Department or State Agency that will identify the works to be provided, timing for provision and the costs to be offset against any contributions required.

 

Page last updated: 31/08/2018