By Laura Michell
Developers have warned Melton council that its plan to increase developer contribution levies in the Toolern precinct will impact housing affordability and the viability of new housing estates.
Melton council has identified a $223 million funding shortfall for infrastructure in the precinct, covering suburbs such as Cobblebank, Weir Views, Strathtulloh and Thornhill Park.
A council review of the Toolern developer contributions plan (DCP) and precinct structure plan (PSP), first prepared in 2011, found a gap between the developer contribution levies currently collected by council and the amount council will need to fund land costs and construct transport and community and recreation infrastructure in the area.
A report to the June 24 council meeting stated that the current levy is collecting about $374.8 million for land acquisition and construction but updated land acquisition costs and construction costs for the Toolern PSP area total about $598 million, resulting in a $223.2 million funding shortfall.
Council wants to increase developer contributions for the precinct in a bid to recover some of the funding gap.
The report to council stated that the developer contributions for Toolern were first calculated in 2010 and were based on an expected future population of 55,000. The precinct is now expected to grow to 68,000 people, the report stated.
In a submission to the review, developer Growland stated that the proposed levy increase would result in an increase of $10,000 per lot to homebuyers, which would “erode housing affordability”. When combined with changes to the national construction code requiring seven-star efficient homes, the increase to homebuyers would be $25,000, it said.
Insight Planning Consultants, who made submissions on behalf of developer Miravor and Australian Unity Funds Management, said the levy increase would need to be passed onto homebuyers as an increased land cost, at a time when there is an “affordability and housing supply crisis”.
“Council and the state government should be doing more to minimise the cost of developing land to facilitate increased supply,” the submissions said.
In submissions made on behalf of Thornhill Gardens estate, Awesome Deer Park and Burke Leading, Human Habitats warned council the viability of estates was at risk.
“The changes to the [developer levies] will have an impact on the viability of the development within the context of an already high development cost environment,” the submissions stated.
“The change … will have an impact on the delivery and diversity of housing product across the Toolern DCP area.”
Speaking at the June 24 council meeting, Cr Sophie Ramsey said the PSP was well over 10 years old and needed to be reassessed.
“We are continually growing … there is so much demand for quality council services and quality council infrastructure that we need to bring things into line,” she said.
Council will refer the submissions to an independent planning panel for review.
