What Are The Common Council Contributions For Developments?
As part of any feasibility or due dilligence, people often ask me what Council fees or contributions will they need to pay when developing multiple dwellings? A lot of the fees are specific to the site or project, but I will run through the common ones that should be considered/researched as part of the planning project:
Council Application Fees
Public Open Space Contribution
Street Tree Removal Fees
Council Application Fees
The first major Council fee you will encounter in your development journey will be the lodgement fee. The lodgement fee is the same for all Councils as it is set by the State Government and is dependent on the type of application and the cost of the development. The fees also increase every year on the 1st of July, so make sure you are looking at the current fees. Details of the fees are on all Council websites and if you aren’t sure what fee is applicable you can ask and be guided to the correct one.
As the application progresses there will be another Council fee. This is for advertising the application to any potentially affected people. Advertising is typically done via a sign on the site and letters to the neighbours for most developments. Many of the Councils organise the advertising for you now and the only thing required is to pay the fee. This fee is set by each Council, so differs slightly. It is also dependent on the extent of advertising deemed necessary (number of letters and signs etc). Your town planner or the Council should be able to give you a guide to the likely cost.
Another fee that can crop up during the application process is an amendment fee. If the application is amended after advertising has been done, the Council will charge you 40% of the current application fee. We make every effort to avoid this fee, though sometimes it can’t be avoided, particularly if significant objections come from neighbours or referral authorities that require the proposal to be modified to be successful.
Public Open Space Contributions
If you subdivide into 3 or more lots, or if a lot in a 2 lot subdivision is deemed capable of further subdivision (usually this is considered to be if one of the lots is more than 500sqm) then you will be required to pay a public open space contribution to the Council prior to the subdivision being completed. Note that this is only triggered by the subdivision. You can build as many dwellings as you want without incurring this fee. It is only during the subdivision process that it is required. It is also only collected once, so if the Public Open Space Contribution has been paid for a previous subdivision of the land, it won’t be applied to the new subdivision.
The Public Open Space Contribution can either be a contribution of land or a fee in lieu of that. The default amount is a contribution of 5% of the land or the value of the land, but this can be varied by individual Councils. A contribution of land is typically only done for larger subdivisions, with smaller subdivisions paying a fee instead. It is important to note that for cash contributions, it isn’t a fee on the purchase price, but on a valuation done at the time the fee is required. This may well be more than you originally paid for the property and so should be factored in.
This fee is only applicable to properties that have a Development Contributions Plan Overlay (DCPO) over them. If there is a DCPO over your site the Overlay will contain details of when the contributions are triggered and what the contributions are. The contribution fees are usually adjusted annually, so you will need to contact the Council to confirm the rate that will be applicable to your development.
An example of a Development Contributions Plan Overlay is for all land in Bayside Council. The Council recently amended the planning scheme to require a contribution for drainage for new development (both residential and commercial) in the municipality. Redevelopment of a single dwelling on residential land doesn’t trigger the contribution, but most other developments will, so it is important to research the specific triggers and contribution fees for projects in Bayside Council.
This contribution applies in a similar way to development contributions. A Parking Overlay can be placed over a site to specify special car parking rates and can also require a cash contribution in lieu of any car parking that isn’t provided on the land. The Parking Overlay will specify an amount for this parking contribution. The parking contributions will only apply if you don’t provide the full car parking requirement on your land.
Typically the fees will be adjusted annually, so again you will need to contact the Council for the current rate if you have this sort of Parking Overlay over your site.
Street Tree Removal Fees
This fee obviously only applies if a street tree will need to be removed in order for your development to be constructed. As the street trees are Council property, they will make the decision as to whether they will allow the tree to be removed. If they agree that it can be removed then they will typically include a permit condition specify the cost for this. The street tree removal fee can often be quite hefty as it is not only the cost of physically removing and replanting a tree, but an amenity fee based on the size of the tree. This amenity fee is intended to represent the value that this tree has in the street, with mature trees being valued at a higher rate. This fee is set by each Council and so can vary between municipalities.
It is also worth mentioning that Council can also refuse to allow the tree to be removed. This may either be a policy of the Council or specific to a tree that is given a high amenity rating. If the Council refuse to allow the tree to be removed, you will likely need to redesign your proposal in order to progress your application.
As you can see, there are a range of different fees that may apply for your multiple dwelling project. Some of these fees, such as the lodgement fee, will apply for all projects and others are only applicable in certain circumstances. It is worth checking over whether there are any contribution overlays (Development Contributions Plan Overlay and Parking Overlay) over your land so that you have a full picture of any applicable contributions for your project. If you do have a development or parking contribution that will apply to your proposal you can contact the Council for the current rates that will apply.