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Development Contributions

25 October 2022

AUTHOR:Kevin Birch

Almost 20 years ago the Local Government Act was amended to allow Council’s to establish a Development Contribution policy. This policy establishes the projected cost of installing infrastructure associated with population growth for the following 20 years or so, and to recover the appropriate proportion of these costs from parties undertaking development. These policies can cover costs in specific areas or general costs across a region, or a combination.

Through a process of consultation, Council’s can amend these Policies through their annual plans. As such these policies are not subject to the sometimes rigorous, lengthy and costly processes involved in amending charges under the Resource Management Act.

Auckland Council have recently advised that they are reviewing their policies in respect to the Drury-Opaheke area, and under the proposed policy each new household (or household equivalent) would be charged $83,251. These costs are met by developers and recovered through the costs of sections and houses. Auckland Council is currently seeking feedback on this proposal, and the consultation dates are on the Auckland Council website. There are benefits in Council funding these charges and recovering it from developers, as it spreads the costs over all future developments in the area. The challenge is to get the formulae right!