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Local Government Act 2002

Savings

Schedule 13: Methodology for calculating development contributions

You could also call this:

“How councils figure out what new builders should pay for community stuff”

When a local council wants to calculate how much people should pay for development contributions, they need to follow a specific method. First, they need to figure out how much money they expect to spend on community facilities or activities to meet the increased demand from growth in the area. Then, they need to work out how much of that cost should be paid by each new development.

The council can include costs for things they plan to build in the future, even if it’s not in their current long-term plan. However, they can only do this if these future projects are mentioned in their development contributions policy and the total cost doesn’t go beyond what’s needed for the time period they’re looking at.

When the council decides how much each development should pay, they need to be fair and consistent. They have to show that they’ve calculated the cost for each development or type of development in the same way. This helps make sure that everyone is treated equally when it comes to paying for new community facilities.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM176090.

Topics:
Government and voting > Local councils
Housing and property > Land use
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13Methodology for calculating development contributions Empowered by s 197

1Methodology for relating cost of community facilities to units of demand

  1. In order to calculate the maximum development contribution in respect of a community facility or an activity or group of activities for which a separate development contribution is to be required, a territorial authority must first—

  2. identify the total cost of the capital expenditure that the local authority expects to incur in respect of the community facility, or activity or group of activities, to meet increased demand resulting from growth within the district, or part of the district, as the case may be; and
    1. identify the share of that expenditure attributable to each unit of demand, using the units of demand for the community facility or for separate activities or groups of activities, as the case may be, by which the impact of growth has been assessed.

      1. A territorial authority may identify capital expenditure for the purposes of calculating development contributions in respect of assets or groups of assets that will be built after the period covered by the long-term plan and that are identified in the development contributions policy.

      2. The total cost of capital identified in subclause (1) may in part relate to assets intended to be delivered beyond the period covered by a territorial authority’s long-term plan if—

      3. the assets concerned are identified in the development contributions policy; and
        1. the total cost of capital expenditure does not exceed that which relates to the period over which development has been assessed for the purpose of setting development contributions.

          Notes
          • Schedule 13 clause 1(1)(a): amended, on , by section 49 of the Local Government Act 2002 Amendment Act 2010 (2010 No 124).
          • Schedule 13 clause 1(2): inserted, on , by section 73 of the Local Government Act 2002 Amendment Act 2014 (2014 No 55).
          • Schedule 13 clause 1(3): inserted, on , by section 73 of the Local Government Act 2002 Amendment Act 2014 (2014 No 55).

          2Attribution of units of demand to developments

          1. For the purpose of determining in accordance with section 203(2) the maximum development contribution that may be required for a particular development or type of development, a territorial authority must demonstrate in its methodology that it has attributed units of demand to particular developments or types of development on a consistent and equitable basis.