NSW Councils could be forced to raise rates if the NSW Government take away Developer Contributions. Mayor Denise Knight spoke about the issue with Moffee on TripleM Coffs Coast breakfast yesterday , saying she was meeting with Gurmesh Singh MP this coming Tuesday.
By The Editor
A full recording of this interview can be heard here (montage image below courtesy TripleM Coffs Coast); https://www.triplem.com.au/shows/moffee-for-breakfast/catch-up/65813f68-e8c9-4b26-a250-ada40170b4a5
This follows on from a Local Government Association media release on 16 July criticising the State Government plans and which is reproduced below;
NSW councils to oppose rule changes to infrastructure contributions
“Local Government NSW (LGNSW) will oppose infrastructure contribution rule changes that threaten to defer and reduce critical developer payments to councils at a Parliamentary inquiry this week.
LGNSW President Linda Scott said the NSW Government had tried to sneak the changes through Parliament during last month’s NSW Budget week to avoid scrutiny, but the peak association for councils successfully pushed back and the legislation was sent back to an Upper House Committee for review.
“These contributions help fund vital infrastructure to support population growth in communities, including footpaths, cycleways, parks and open space to help cope with the increased demand new development brings,” Cr Scott said.
“I was surprised the NSW Government tried to push through changes that would result in potential deferral and reductions of these payments without even consulting councils and their communities.
“The proposed new rules may help developers, but they will potentially hurt communities and shift some of these costs incurred by new development back to communities.
“The changes could also result in the delay or removal of projects for the public good from local government community plans, with a consequential hit to important community infrastructure such as pools and parks, as well as investment and jobs that would have been generated through the design, development, delivery and operation of these public facilities.
“I am looking forward to speaking on behalf of councils and our communities at the Upper House Committee inquiry, where I will be calling on this rushed legislation to be withdrawn so councils and our communities can ensure vital community infrastructure can proceed, and councils are no worse off.
“This Bill, if passed, breaks the nexus between development and place. The NSW Government could regulate to collect a contribution from a development in Penrith and spend it in Potts Point.
“Communities that bear the brunt of density deserve to receive a public benefit in return. This Bill risks breaking that strong link between a place and a public benefit.”
Cr Scott said a cursory review of the proposed changes revealed a number of significant problems.
“The Bill also seeks to make permanent some troubling temporary arrangements, including allowing the Planning Minister to direct all councils to permit deferral of infrastructure payments by developers until the completion of the project,” she said.
“Communities shouldn’t have to wait for thousands of new residents to move in so that the roads can be built, and then dug up to build the drains. This reform condemns infrastructure upgrades incurred by new developments to the very end of the process.
“Importantly, it would delay the provision of parks, cycleways, footpaths, stormwater drainage and a plethora of vital infrastructure and leave new residents without essential services and facilities when they move into an area.
“Local governments are advocating for the value of the developer contributions to cover the cost of increased local infrastructure required to meet the needs of new residents.
“The NSW Government must provide assurances that councils and our communities will not be worse off under any of these reforms.”
Cr Scott will be joined at Friday’s Parliamentary hearing by representatives from Illawarra Shoalhaven Joint Organisation, Western Sydney Regional Organisation of Councils and Riverina Joint Organisation, who will also argue for the withdrawal of the Bill for further consultation.”
Twenty two Sydney Councils yesterday ran a full page advertisement in the metropolitan daily newspapers voicing their concerns;
Mayor Knight’s plea for residents and ratepayers lead to a number of reactions locally. Together We’ll Fix It candidate for Mayor, Rodger Pryce, posted the following on his social media site;
“So, lots of commentary about the State Government suggesting that they are considering having Council contributions, paid to and managed by themselves.
There is also the suggestion that whilst the contributions may be collected for a specific purpose, or use, there is no suggestion that when the funds are spent, that it will be spent on what it was collected for.
If this is the case then that of course would be totally unacceptable.
The other question that exists is, why has the Council not spent, what is rumoured to be, $10s of millions of dollars of contributions, which remain in Councils bank accounts? Add to this, millions of dollars in grants, either allocated or, in fact given to our Council, also remaining unspent in Council bank accounts.
We are aware of grants being given to our Coffs Harbour LGA, to be implemented by Council, back in 2019.
How can we expect our Government to keep giving us grants when we haven’t spent what we have already been given?
The question does need to be asked: Can we please have Council disclose, how many million dollars of contributions and grants are in our bank accounts? Can this include an aged report, in other words, identify for how long have some of these contributions and grants been sitting waiting to be spent?
Let us also remember, the NSW Treasury, via TCorp, it’s finance arm, would not lend us money for the CCS project as it viewed a percentage of the cash we have invested being in too high a risk investment areas.
So why don’t we get the money spent?”
CCO editorial comment;
It is very doubtful if this move by the State Government relates solely to the CHCC. And some of the fears and issues raised by the Local Government Association have genuine merit, especially in regards to the deferral of developer contribution expenditure.
However, the irony of Mayor Denise Knight urging local residents and ratepayers to contact the State Government in opposition to this proposal is rich indeed.
Approximately 15,000 locals did just that via a petition in regards to the CCS in Gordon Street, now to be known as Yarrila Place. Approximately 800 people submitted objections to this proposal to the Ministry of Planning.
They could see a myriad of problems with the proposal and clearly articulated many reasonable concerns in our opinion. Many see the CCS itself as a guaranteed rate rise generator in spite of the promises of the Mayor, who has since announced she will not run for re-election.
Their entreaties were ignored by four Councillors and Council’s Executive Management and they were scorned as ‘a noisy minority’.
Among the concerns raised by that so called ‘noisy minority’ were that that the CCS would effectively drain money from other essential services.
Our finance commentator, Rob Steurmann, a retired federal forensic auditor, has raised here on many occasions concerns about the opacity of council’s accounts.
Yes, they may meet the required format under the Local Government Act, he said, but in his learned opinion many concerns arose about the expenditure of government grants, how they were accounted for and how some still seemed to be unspent.
Clearly this may also be an issue in other LGA’s in NSW too. As we say above it is doubtful this legislation is driven by the actions of one NSW council alone.
However, it is hard not to have some degree of suppressed schadenfrude in the position Council now finds itself in, a German term which means “enjoyment obtained from the troubles of others”.
The worsening opacity exhibited by this Council is an issue we return to time and time again here at CCO. Only to be ignored and for the situation to usually just worsen.
If this proposal by the State Government were to shine just a little more light on the workings of our council, just some more transparency even, then it has the germs of some good outcomes at least.
Lead photo: From Local Government Association media release 16 July 2021.