The new infrastructure charges regime in Queensland

By Karen Trainor.

Key Points:
The changes seek to further integrate infrastructure planning with land use planning at a local, regional and State level, by introducing Priority Infrastructure Plans into planning schemes.

The new regime

Amendments to the Integrated Planning Act 1997 ("IPA"), which commenced on 4 October 2004, have changed the way planning for infrastructure will be undertaken in Queensland. The amendments seek to further integrate infrastructure planning with land use planning at a local, regional and State level. The amendments will occur largely through the introduction of Priority Infrastructure Plans ("PIPs") into planning schemes. It is envisaged that IPA planning schemes will incorporate PIPs by 31 March 2006.

The PIPs must be prepared in accordance with Infrastructure Guideline 1/04 and are intended to show how urban growth will be managed in each local area by establishing a benchmark for the planning scheme, identifying the location and timing of growth, the nature and scale of growth and service standards. A PIP will be the core element of the infrastructure charging framework as it provides the basis for the calculation of infrastructure charges.

The PIP must identify the priority infrastructure area. These areas must accommodate 10 to 15 years growth for residential, retail, commercial and industrial development. The IPA requires that the boundaries of the priority infrastructure area, as well as the planning assumptions, must be agreed with suppliers of State infrastructure as part of the process of making a PIP.

Infrastructure is either trunk infra-structure or non-trunk infrastructure.

Trunk infrastructure is infrastructure identified in a Priority Infrastructure plan as trunk infrastructure and may includes land and works for:

• water cycle management infrastructure (water supply, sewerage, collecting water, trading water, stream managing, disposing of waters and flood mitigation);
• transport infrastructure;
• local public parks infrastructure; and
• community facilities such as community halls or centres, public recreation centres and public libraries.

Non-trunk infrastructure includes networks internal to premises and connections to external infrastructure networks.

Trunk infrastructure may be identified as existing trunk infrastructure, necessary trunk infrastructure or additional trunk infrastructure. Necessary trunk infrastructure is trunk infrastructure identified in a PIP which is necessary to service the premises but which is not yet available.

Local governments may generally only levy charges for trunk infrastructure under an infrastructure charges schedule or a regulated infrastructure charges schedule (a generic infrastructure charges schedule developed by the State government intended to be used by smaller Councils with insufficient resources to develop infrastructure charges schedules) pursuant to an infrastructure charges notice. Infrastructure charges notices may be included with development approvals or issued separately.

However, a condition of a development approval requiring a developer for carrying out works for necessary trunk infrastructure may be imposed where a development is premature having regard to the timing of the provision of infrastructure contemplated by the PIP. A condition requiring a contribution for additional trunk infrastructure may be imposed where:

• the development is inconsistent with the assumptions about the type, scale, location or timing of future development stated and the PIP; or
• the land is outside the priority infrastructure area.

Key elements of an infrastructure charges schedule include:

• identification of the charge for each trunk infrastructure network;
• the estimate proportion of the establishment cost of each network to be funded by the charge;
• when is it anticipated the infrastructure will be provided;
• estimated establishment cost of the infrastructure;
• each area in which the charge applies;
• the type of Lot or land use for which the charge applies; and
• how the charge must be calculated.

An infrastructure charges schedule must be made in accordance with the guidelines and is generally required to follow the same process as making a planning scheme policy. It is therefore possible to make a submission in relation to any proposed infrastructure charges schedule.

Significantly, an infrastructure charge:

• is not recoverable unless the entitlements under the approval are exercised (the notice lapses if the approval is no longer in effect);
• cannot relate to works or use of land authorised under the Mineral Resources Act 1989 (Qld) or the Petroleum Act 1923 (Qld); and
• an infrastructure agreement can be made to vary the time for payment or allowing supply of infrastructure instead of payment;
• may be levied in respect of an existing lawful use based on the current share of usage of the network at the time the charge is levied; and
• must not be more than the proportion of the establishment cost of the network that reasonably can be apportioned to the premises for which the charge is stated.

Challenges to infrastructure conditions and contributions

Developers will still be able to challenge conditions of a development approval, including those conditions relating to infrastructure contributions and works in certain circumstances. However, conditions relating to necessary trunk infrastructure and additional trunk infrastructure that comply with the requirements in IPA are deemed to comply with the relevant or reasonable condition test.

Significantly the IPA provides that a person may only appeal against an infrastructure charges notice about:

• the methodology used to establish the charge in the infrastructure charge in the infrastructure charges schedule; or
• an error in the calculation of the charge.

In practice this is likely to mean that infrastructure charges notices may only be appealed where:

• the methodology used in the infrastructure charges schedule is inconsistent with the charging principles set out in the IPA and where the local government has not complied with any procedural or technical requirements identified in the regulations and guidelines to set up the infrastructure charges schedule;
• the cost of the infrastructure described in the PIP has not been correctly apportioned between the existing and future users or those within and outside the charging area, particularly having regard to the anticipated usage of the infrastructure or capacity of the infrastructure allocated to each group;
• the charges exceed the council's desired standard of service identified in the PIP in respect of minimum life cycle cost or the existing network has not been fairly valued;
• errors in assessing the demand from the development - what is the existing demand from the premises; what will the future demand be;
• levying a charge where a charge is not appropriate ie. imposing a charge where the development does not result in additional demand on the infrastructure network;
• application of any system of credits for previous infrastructure contribution - what was the previous contribution, is there full or only partial credit available;
• errors in converting demand into the charging units used in the infrastructure charges schedule; and
• basic errors in the mathematical calculation of the charge for the premises.

While the new infrastructure regime is intended to increase transparency by requiring contributions to be used to provide infrastructure for the network for which it is levied, in reality it is likely to be time-consuming and costly to challenge an infrastructure charge because it will require an analysis of the whole of the relevant network unless the challenge is based on a simple mathematical error.

Thanks to Andrew Young for his help in writing this article.

For further information, please contact Karen Trainor.