Section fees hike concerns

Council charges for developing sections in Dunedin are set to more than double in some areas.

The Dunedin City Council says the proposed new rates would still be some of the cheapest in the country.

But a developer said he would fight the proposed hikes, saying the council was making development harder.

Councillors yesterday voted to send an updated development contributions policy out for public consultation.

Dunedin median house prices are up 6%, just shy of the national average of 6.9%; pictured, the...
Councillors yesterday voted to send an updated development contributions policy out for public consultation. Photo: Stephen Jaquiery

Development contributions, which are a one-off charge paid by developers, are used to fund growth-related infrastructure.

Changes included the removal of $5000 caps on specific infrastructure types, private development agreements for developments within the Mosgiel plan change area, and significant increases to the total contributions paid in almost every area of the district.

In some specific instances contributions would be double the current charges.

Dunedin Central brownfields development charges would jump from $8490 to $13,660, while Middlemarch costs would increase from $1340 to $11,010.

But councillors were overwhelmingly in favour of the changes, pointing out that if the money did not come from developers, the burden would fall on ratepayers.

Deputy mayor Christine Garey said the proposed charges would still be some of the lowest in the country, and said people got incredible value for their money.

She believed that meant Dunedin would still be looked at by potential developers very favourably compared with other places.

It was expected that contribution rates would go up as rates of growth increased, Cr Jim O’Malley said.

"This is growth, not renewals."

If development contributions did not increase, the money would have to come from ratepayers, he said.

Cr Mike Lord said the value of sections continued to climb, and he did not believe "a few
extra dollars" would stop
housing developments.

It was unfortunate the increases were so high, Cr Jules Radich said, and he knew people who would be incurring those costs.

However, he believed the costs were justified and was ultimately supportive.

Cr Carmen Houlahan was the lone nay vote on the proposal, saying increasing the costs significantly during a housing crisis was concerning.

"I get numerous complaints from developers that costs are too restrictive," she said.

Dunedin property developer Lloyd Morshuis said he would fight the proposed hikes.

He said contributions were supposed to be related to developments, not "old infrastructure the DCC hasn’t upgraded for 30, 40 years".

While the contribution rates would still be cheaper than in other regions, the cost of development was higher in Dunedin in general because of its hilly landscape, he said.

"They’re just making the whole job harder, they’re leaving it open for only big corporations to come in and do developments," Mr Morshuis said.

"People just won’t bother."

The report to councillors stated there would be targeted engagement with developers, as well as public consultation alongside 10-year plan consultation.

Fellow developer Allan Dippie said Dunedin had traditionally been a bit behind other centres in terms of what it charged, so the new rates were "pretty realistic".

But, he believed constraints on development and growth meant there was not much development happening anyway, rendering the point somewhat moot.

daisy.hudson@odt.co.nz

 

Comments

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So we have a housing shortage and a council that doesn't know how to cut it's cloth to suit, so looks at anyways possible to extort money from its people.
This council are a disgrace

Not only that but they are also making rents/private purchases less affordable by significantly raising rates, but hey, at least they are buying up houses for themselves with our tax money (at a premium after selling them years ago). It's gone beyond a joke.

"....He said contributions were supposed to be related to developments, not "old infrastructure the DCC hasn’t upgraded for 30, 40 years"....."

It wouldn't be so bad if they did spend it on the old neglected infrastructure.
But it won't be.
It'll be frittered away on unwanted glitter and baubal projects and pointless meetings where they conclude they are 'victims of their own success'....

Wrong, development contribution money can only be spent for the purpose for which it is imposed - growth related infrastructure requirements.

That's the law and DCC has no choice but to comply with the law.

Good call DCC. Developers create the need for expanded, new infrastructure such as roads, pipes and lighting. This new infrastructure isn't cheap and the ongoing maintenance is an additional cost against the ratepayers. At the very least the developers should be contributing a fair share towards the initial cost of new infrastructure.

This will not stifle development, the developers will pass on the cost to the people who buy the sections, and they will still be sold as the demand is there and will be for some time to come.

Just another case of developers bleating hard up.

What's the point in optimising revenue sources when the council are throwing money away. $40k on rental flowers, $350k on Octagon sand pits, $145k per unnecessary Barnes dance crossing. Pursuing an over the top green agenda at a time when the city struggles with unaffordable housing, covid, and poverty.

Why would the council ask for public consultation, when they never listen to, or care about what the public say anyway?

Also, "If development contributions did not increase, the money would have to come from ratepayers" yes, but no, because the developer will just pass the increase onto the buyer anyway.. I stopped reading after that. .

You didn't miss anything of value

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