Auckland Council must align contributions policies

Media Statement
12 November 2008

Auckland City Council must align its contributions policies to remain fair and legal

Cuts in the region of hundreds of millions of dollars in spending on capital works, such as footpaths and stormwater, will require Auckland City Council to either defer or cancel its requirement for developers to pay financial, development and reserve contributions, according to Property Council.

Connal Townsend, Chief Executive of Property Council, said contributions paid by developers must be spent on capital works projects that provide the infrastructure needed to cater for growth.

“If Auckland City Council no longer intends to spend money on core services and infrastructure, it will be required to cease its practice of demanding cash and land from developers. If the Council is not spending, developers should no longer have to pay,” Connal Townsend said.

Auckland City Council’s development contributions policy was amended by the previous Council, which saw the quantum of levy charged to individual developers in the Auckland Central Business District increase by up to 500 per cent. This increase helped to kill off much of the inner city apartment market.

“The Council has a poor record of fairly allocating the cost of growth and matching it to its spending program. Recently Auckland City Council was found by the High Court to have unfairly ‘double-dipped’ when it charged a developer both a financial and reserve contribution for a building development project in Parnell.

“Now the Council is publically expressing the need to slash spending. While Property Council supports the Mayor’s policy of financial prudence, we expect that the Council will make the appropriate changes to its contributions policies in order to match the cancellation of spending with the cancellation of levy demands to developers,” Connal Townsend said.

Mr. Townsend will seek clarification of the Council’s intention to change its policies to align with reported cost-cutting measures.

ENDS

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