Fears over move to new system

Developers are concerned the Tasman District Council could move to making up any financial shortfall under the proposed "once paid/always paid" system of development contributions by slowly increasing costs.

At a council hearing yesterday on the future look of the council's development contributions policy, developers and estate agents also questioned the council's assessment that moving to the "once paid" system will cost about $1.45 million in lost development contributions a year or $3.5m over the life of the current long-term plan.

In October the council decided to move to the "once paid" system after a running stoush with industry stakeholders which was sparked by its revision earlier in the year of development contribution rules which saw the removal of a 67 per cent first dwelling discount without informing the industry early last year.

The proposed system would see developers, or home builders, only pay development contributions on water, wastewater and roading once, rather than the council's three-stage "top-up" policy.

In its proposal to review its development contributions policy, which was open for public submission until January 15, the council said any shortfall caused by the move to a "once paid" system would have to be offset by increases in the development contributions, targeted rates or increases in general rates. Or further growth-linked projects could be delayed or cancelled.

Glen Jarvie, of GJ Gardiner Homes Nelson, who was among the 15 submitters to the proposal, told councillors at yesterday's environment and planning committee meeting that he backed the "once paid" option, but was concerned the council appeared to have over-estimated the district's population growth over the next 20 years and underestimated the number of homes which would be built.

"I lack confidence in the information presented to the council."

Graeme Thomas representing Brightwater Developments requested a policy be included in the new rules stating it would not increase costs to make up for lost development contribution income.

And John Cotton, a director of Cotton and Light Surveyors, said the proposed "once paid" policy was a no-brainer. But fixed rate blanket charges disadvantaged lower cost developments in towns like Murchison or Tapawera, made rural subdivision more attractive because that process did not incur development contributions, and the three-year reviews could see fees shift significantly.

Ben Cooper, of Ray White Real Estate, also supported the "once paid" option but believed the proposed funding model was not correct and felt rezoning and infrastructure spending for development should be done in those areas of most demand. He also said the "once paid" contribution should be paid at resource consent stage so there were no extra charges to the end user.

Mark Lile, of Landmark Lile Ltd, asked that the council recognise non-residential development with a special assessment procedure which took historic paid contributions into account.

Council staff will report back to a special meeting early next month with an amended development contributions policy.