Section 94a legislation changes

Construction News / March 9, 2019

On 28 July 2017, the 2012 Direction was amended by the Environmental Planning and Assessment (Local Infrastructure Contributions) Amendment Direction 2017 so as to increase and “uncap” the section 94 contribution caps for particular areas

The Environmental Planning and Assessment (Local Infrastructure Contributions) Direction 2012(2012 Direction) sets caps on the amount of section 94 contributions that can be required by consent authorities in certain areas, and therefore stipulated in a contributions plan.

The effect of the amendment is to “uncap” section 94 contributions, the requirement for contributions to be calculated in accordance with an Independent Pricing and Regulatory Tribunal (IPART) reviewed contributions plan acts as a safeguard against unreasonable contribution amounts by councils.

In Local Infrastructure Growth Scheme (LIGS) areas, the maximum cap will be incrementally increased from 1 January 2018 until 1 July 2020 when the caps will be removed entirely

Before 28 July 2017, the maximum amount of monetary contributions payable under section 94 of the Environmental Planning and Assessment  was either $20,000 or $30,000 (depending on the location of the land) for each dwelling or residential lot authorised to be created by a development consent. From 28 July 2017, the NSW Department of Planning and Environment released Amendment Direction 2017 which amended the 2012 Direction. The amendment allows councils to increase and “uncap” the amount of section 94 contributions that can be imposed on certain developments.

Section 94 of the Environmental Planning and Assessment gives consent authorities the power to require contributions as part of a development consent. The contributions can be in the form of monetary contributions, the dedication of land free of cost or a combination of both. The power to require contributions is triggered if the consent authority is satisfied that the development will or is likely to require the provision of or increase the demand for public amenities and public services within the area.
Section 94(2) of the Environmental Planning and Assessment works to ensure that consent authorities only require a reasonable dedication or contribution for the provision, extension or augmentation of the public amenities and public services concerned. In addition, section 94B of the Environmental Planning and Assessment only allows contributions to be imposed if the contribution is of a kind and is determined in accordance with an applicable contributions plan.