However, one developer says while the council’s proposed changes are a step in the right direction, they do not go far enough.
At today’s economic development committee meeting, Dunedin city councillors will consider a report on development contributions, including staff recommendations, to phase-in hikes over 2-3 years and cap costs in Warrington, Seacliff, Karitane, Waikouaiti and Middlemarch to $27,170.
The council consulted on the changes earlier in the year, saying significant increases in charges were proposed for some areas based on the level of spending planned to accommodate growth.
However, several Dunedin developers opposed the increase, saying it could halt the city’s growth.
Yesterday, TGC Homes director George Hercus said the recommended changes improved the policy but did not address its core issues.
"You can’t tax your way out of the problem — you need to create growth and let growth pay for the problem."
The proposed capped cost was still too high.
In Middlemarch it was equal to a third of the average land cost of $80,000, "which is just crazy".
"It almost defeats the purpose, putting a cap on it, because at that price no-one’s going to develop in Middlemarch."
Phasing in increased charges over a longer period was an improvement, although he said the council should not increase development contributions at all.
"Since the DCC have come out with this, we’ve actually had other councils from around the South Island approach us to develop in their city because their development contributions are either much lower than Dunedin, or they don’t actually have development contributions.
"They’re sort of rolling out the red carpet as such, to try and help with any transition into their region."
In her report to the council, special projects manager Sharon Bodeker said 13 of 15 submissions on the draft policy were opposed to increased charges.
Introducing caps and phased increases would address some of the concerns raised by submitters, reduce barriers and support growth.
However, growth not covered by development contributions would be debt-funded with rates covering the subsequent repayment and interest costs.
The committee’s recommendation would be considered at next week’s council meeting.
