Asset Management Plan Update No. 5 – LGA Amendment (No 3), Development Contribution

The Local Government Act Amendment (N0 3) Bill was introduced to the New Zealand parliament in November 2013, went through the parliamentary process, and has been in force since 2014.

The ‘Better Local Government’ Cabinet Paper referenced on the Department of Internal Affairs website offers a good background to the issues that were considered in the drafting go the LGA Amendment (No 3) Bill.

Anderson Lloyd Lawyers have provided a good high-level summary of the Bill on their web site.

The Department of Internal Affairs has also provided other useful information on the Better Local Government section of their web site.

Two components of this Bill will impact the AMP update 2014:

1. Infrastructure Strategy
2. Development Contributions

This blog post highlights a few points on the proposed Development Contributions changes as they relate to the 2014 AMP Update.

1.  The definition of community infrastructure has been tightened.  This may affect community infrastructure revenue streams.  If this is the case for your authority then you will need to review this part of your LTP and AMP
2. There are new purpose provisions that set the scene for development contributions which must be ‘proportional and fair’
3. The development contributions policy must now include a schedule of infrastructure for which development contributions will be used. This schedule must list the asset, estimated capital cost, the proportion to be paid by development contributions and the proportion to be paid by other sources (clause 55 inserts a new section 201A) – (from the Anderson Lloyd article)
4. Private provision of infrastructure can be made through the use of development agreements

The schedule of infrastructure requirement has the most potential to impact 2014 Asset Management Plan updating.

Decisions will need to be made about where this schedule is maintained, how it is updated, controls around the schedule, and accounting considerations.  The reporting of the development contributions schedule of infrastructure in the relevant AMPs and LTP will need to be considered.

The Asset Management Plan should also include commentary on private infrastructure provision and the interrelationship with public infrastructure.

PHOTO CREDIT: Karl Hipolito