Discount route for Townsville developers

By Penny Langfield

Townsville City Council is attempting to entice developers with an innovative new scheme that offers a discount on recently introduced infrastructure charges.

For a number of years the Queensland State Government has required Priority Infrastructure Plans (PIPs) to be created by councils, identifying how urban growth will be managed.

Under the PIPs regime there is now also a State requirement for councils to adopt a user-pays system to calculate road contributions by July and to collect developer contributions for the local traffic use of trunk main roads on behalf of the State Government.

Townsville is offering developers a 33 per cent discount on the contributions for the first 13 months as an incentive to secure early planning approvals.

Townsville deputy mayor Cr David Crisafulli supports the move towards a user-pays system but said the discount would offer some breathing space.

“There could be no more inappropriate time to introduce hefty new charges because things are very tight at the moment,” he said.

“We wanted to find something that struck a balance between heading in the right direction and at the same time act as a stimulus package to encourage people to lodge their applications in the next year.

“It allows industry time to adapt to a user-pays system, but it also provides genuine incentives to get applications up and off the ground now, at a time when they would otherwise not be considering that.”

Crisafulli said the council undertook intense pricing negotiations with industry over many months “and as a result industry got something that they feel is closer to the true cost than it otherwise would have been”.

“We want to ensure that as our city continues to grow we are in a position to be able to provide those services that people demand, and the way to do that is to make sure that the developer helps pay their share upfront,” he said.

It is expected the discount will end when it is reviewed in July 2010.

“We’ll be willing to look at how industry is travelling, how the economy is placed but at this stage we have made a very clear window of when we expect that 33 per cent [discount] will end,” Crisafulli said.

Gold Coast City Council was the first local government area to implement its infrastructure charges scheme under the PIP legislation in January 2007.

Gold Coast Sustainable City Future Committee chairman Peter Young dismissed the idea of strategies such as subsidies and discounts for Gold Coast developers.

“We decided instead to put a lot of money, $90 million this financial year, into a package of capital works which we believe will stimulate the building industry, the construction industry in a much more direct way,” he said.

“We looked thoroughly at all the various options and decided the best way for us to help the industry is to protect the economy.”

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