Developers face massive increase in Hutt City
Developers in Hutt City are facing a massive increase in the development fees paid to council for new builds.
The fee increase, up more than $38,000 for developments on the valley floor, was outlined to councillors signing off the draft 10-year long term plan yesterday.
The plan, which also includes a 16.9% increase for the average residential ratepayer, contains a number of fish hooks that are likely to cause angst in the community.
As well as the possible demolition of the Petone wharf, the plan includes introducing paid parking to Petone and an increase in parking fees across the city.
Councillor Brady Dyer called for the wording of the reference to Petone Wharf to be changed to make it clearer that the council’s preference was to demolish it.
Petone residents have long opposed paid parking on Jackson St, arguing that free parking on the retail strip is a point of difference from Lower Hutt and Wellington City. It is the changes to its development contributions policy that could cause the most comment.
A developer building on the valley floor faces an increase from $14,779 to $53,003. On a section with 10 properties that would result in the council receiving $530,000.
In Wainuiomata, the fee jumps from $26,000 to $41,956 and in Eastbourne from $7802 to $19,736.
The increases are predicted to result in extra revenue of $146 million over 10 years, which would otherwise have to be funded by rates or higher borrowing. The fee goes towards the infrastructure required for new builds.
The Post understands that a group of developers, builders and real estate agents last week met with Infrastructure Minister Chris Bishop to express their concern over the new fees.
The draft plan would result in debt reaching $1 billion by 2030 and predicted rates increases as high as 12.4% over the next few years.
Mayor Campbell Barry expressed concern about the council’s ability to fund itself going forward. He said nationally there was a need for a “bigger conversation” about the way councils are funded. “There is a serious need for reform.”
Without new revenue streams some councils would be forced to reduce services, he said.
As well as congestion and bed taxes, he said the council should get a share of GST and the Government should also pay rates on buildings it owns.
The council is budgeting $1.6b for three waters and he said if the council were to receive a share of the GST on those projects, that would help fund the work.
Barry agreed with Auckland mayor Wayne Brown, who this week called on central government to pay rates for properties it owns in Auckland. For an average residential ratepayer, 16.9% equates to a weekly increase of $10.83 per week. For every $100 collected in rates, about $60 will be spent on water and transport infrastructure.
The council has added $2.8m to target the backlog of leaky pipes. There are currently more than 800 leaks in the city and with the extra funding, the council hopes Wellington Water will get on top of the leaky pipes that have plagued the city.
Residents have until May 3 to make a submission on the plan.