Credits for existing development or past contributions
Local infrastructure contributions practice notes
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Credits ensure equity in the contributions system by preventing double charging for infrastructure where an appropriate contribution has previously been made. They can be granted in two circumstances:
- credits for existing development
credits for past contributions.
This module discusses credits in the context of section 7.11 contributions.
Offsetting a contribution liability using a works in kind agreement is discussed separately.
Legislative requirements
Councils must consider previous contributions made by an applicant before imposing a condition requiring a further contribution under section 7.11.
| Legislative requirements | Reference |
|---|---|
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For section 7.11 contributions, councils must take into consideration any land, money or other material public benefits that an applicant has previously provided (unless these formed part of a condition of development consent or were part of a planning agreement that excluded consideration of the benefit). |
Policy positions
Credits for past contributions or existing development can reduce the contributions liability
Credits for past contributions or existing development are calculated when the development consent is issued and are reflected as a lower contribution on the condition of consent. This is different to offsetting a contribution liability under a works in kind agreements, where the condition of consent shows the full amount due and the parties later agree to pay this liability through work instead of a contribution.
Councils should provide a clear policy in the contributions plan on when they will grant credits
Councils should consider any previous infrastructure contributions made for the development site and can provide credits for these where appropriate when determining a section 7.11 liability. It is up to the council to determine how to value previous contributions.
Councils will have different considerations for when they provide credits, how credits will be calculated, and the evidence needed to demonstrate that a credit should be granted. Councils should have a specific policy on credits in their contributions plans and apply it consistently.
Credits for residential development
Councils should provide a credit that is either equal to existing demand present on the site, or equal to any previous contributions paid. However, this will differ slightly depending on what type of contributions were previously charged.
It is not always straight forward to calculate credits based previous contributions made, or to calculate the exact existing demand present on the site. For simpler developments, councils can consider providing a credit by reducing the number of dwellings being charged by the number of dwellings that exist on the development site. For example, a single dwelling being redeveloped into five town houses may only be required to pay contributions for four dwellings.
Credits for commercial or industrial development
Credits for commercial and industrial development can be more complicated. Commercial and industrial buildings may have different uses at different intensities over time, such as higher or lower levels of traffic generation. Councils will need to assess these on a case by case basis.