Questions raised around the validity of Tauranga’s increasing development contribution fees

MEDIA RELEASE

Property Council New Zealand’s Bay of Plenty members are questioning Tauranga City Council’s reasons for increasing Citywide development contributions, also known as building impact fees, by more than $16,000, saying one of the projects identified for funding has already been previously budgeted for.

“The Tauranga City Long-term Plan 2021-2031 notes that the Citywide development contributions increase will be used to fund the Waiāri Water Supply Scheme to ensure a reliable and adequate water supply. However, the Waiāri Water Treatment Plant, which is part of the same water supply scheme, was previously funded by the Housing Infrastructure Fund via a 10-year interest free loan back in 2018”, says Property Council spokesperson Scott Adams.

“We have recently been notified that the Housing Infrastructure Fund has never been spent on the Waiāri Water Treatment Plant. We’d like the Council to clarify whether this money has been spent, and if so, what on? It is concerning that the Council would see fit to use this project as a reason for increasing Citywide development contributions when there has already been funding allocated that seems to have disappeared. Why should developers, and therefore homeowners, pay for a project that has already been funded?

“By our estimation, there will be approximately 200 new builds affected by the proposed increase. It is critical to ensure that the numbers are accurate and there is no double-dipping.

“Our members, who are primarily property developers, investors, managers and professionals, fundamentally support improving the city’s infrastructure. What we don’t appreciate is the Council’s lack of transparency around what these funds will be used for. We encourage the Council to review its funding of the capital programme taking this into account”, says Adams.

“The Council has used commercial developers and owners as a bank for many years, with a constantly increasing commercial rates differential and additional costs to development. Often, the level of commercial rates paid is disproportionate to the level of services received.

“If we want more homes for our community and successful delivery of supporting infrastructure to meet demand, we need to strike a balance. The Council must make better use of alternative funding tools, such as user charges, public private partnerships, special purpose vehicles and asset recycling amongst others”, says Adams.

ENDS

 

Click here to download the release as a PDF

 

For further comment please contact:
Scott Adams | Property Council Spokesperson | 021 481910 | scott@carrus.co.nz

For more information please contact:
Kelly Taylor | Head of Communications | 021 5757 02 | kelly@propertynz.co.nz

 

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