Growth for the sake of growth could lead to poor development and unintended consequences if not properly regulated, the Dunedin City Council warns.
In a proposed submission, the council backed the government’s Infrastructure Funding and Finance Act Amendment Bill’s intentions, but was wary of its possible unforeseen effects.
The Bill intends to improve infrastructure funding and financing tools to support urban development.
It is part of the government’s omnibus strategy to enable and simplify urban growth where appropriate.
The council’s draft submission expressed concern about the Bill’s potential for unregulated growth, where the councils could be left to picking up the bulk of the costs.
"DCC supports the principle that growth should pay for growth, and the intent of the Infrastructure Funding and Financing framework to enable timely infrastructure delivery to support growth, independent of council funding constraints.
"However, we are concerned that a planning system focused on enabling responsiveness will likely result in urban expansion in locations where infrastructure cannot be efficiently provided."
The council submission also warned the Bill, by encouraging more growth, may inadvertently lead to networks that were "inefficient or poorly integrated".
In particular, it could lead to breaks in the Three Waters network and disposal systems that were "disconnected from metropolitan networks, or [require] long network extensions to service rezoned rural land distant from existing urban boundaries".
The council estimated producing water for small-scale rural schemes was typically 4.5 times more expensive than for metropolitan systems, and treating and disposing of wastewater was about 7.5 times more expensive for rural schemes than urban equivalents.
The Bill does not seem to acknowledge this, the submission says.
"Under the Bill, there is a risk that developers may propose infrastructure that is not required from a network efficiency perspective, yet councils may be required to endorse it if it is technically compatible with existing systems ... ultimately, these costs are likely to be borne by existing and future ratepayers."
There were also risks of developing too quickly, the submission said.
"Where development proceeds ahead of planned servicing, councils can face pressure to bring forward upgrades, expand scope, or adopt interim solutions that are less efficient than planned investments.
"In practice, this can translate into higher capital costs, higher operating and maintenance costs, and reduced flexibility in future years."
The submission raised concerns about large-scale private developments which could place councils in a "position of inheriting long-term maintenance and renewal liabilities without clear oversight".
"The council supports the principle that growth should pay for growth, subject to two conditions: council discretion to decline proposals that are inappropriate or inefficient to service, and the availability of effective and flexible financing mechanisms to fund the infrastructure required to support growth."
The council will discuss the submission at Thursday’s policy and planning committee.
