Local infrastructure contributions can be used to fund a range of different types of infrastructure. However, there are specific requirements on what can be funded depending on which mechanism is used. This module details the infrastructure that can be funded through: 

• section 7.11 contributions 
• section 7.12 levies. 

Planning agreements can fund a wider scope of infrastructure and public purposes.  

Legislative requirements

Policy positions

Councils can use contributions to help fund the infrastructure they provide

Infrastructure contributions under section 7.11 and section 7.12 can fund items described by the EP&A Act as ‘public amenities and public services’. Public amenities and public services are not defined in the EP&A Act or other legislation. The practice notes use the term local infrastructure to mean both public amenities and public services. 

Councils are generally responsible for providing local infrastructure such as local open space, local roads, traffic management works, stormwater drainage and community facilities such as libraries, childcare and recreation facilities.  For the purposes of infrastructure contributions, local infrastructure (‘public amenities and services’) does not include water supply or sewerage services. 

Only capital costs can be funded through local contributions

The EP&A Act requires that contributions can only be used for the ‘provision, extension or augmentation’ of this infrastructure. The practice notes use the term capital cost to mean provision, extension and augmentation. 

Local contributions can only fund the capital costs of new infrastructure and extending or augmenting existing infrastructure. Capital costs mean the initial one-off cost of providing the infrastructure. It includes: 

• the costs of land and land acquisition including all things necessary to bring the land into council ownership and to a standard suited for the end use 
• construction and provision of facilities including all the things necessary to facilitate construction and to bring the facility to a standard that is suited to the end use 
• the costs of borrowing incurred by forward funding infrastructure 
• some administration costs incurred by the council. 

Recurrent funding and maintenance cannot be included in contributions plans 

Councils cannot use local contributions to fund the recurrent costs associated with the new infrastructure funded by contributions. This includes costs such as maintenance, asset management and operational costs. These costs should be funded from council rates revenue or other sources, such as grants or user charges.  

The only exception to this is recurrent funding for the ongoing cost of roads where heavy vehicular traffic movements arise directly from specific development activity, such as for the mining and extractive industries. This is because these costs are not required as a result of the regular wear and tear on a road, but rather damage caused directly by the development itself. 

Plan administration can be a capital cost and included in a contributions plan 

Plan administration costs include only those costs that relate directly and solely to preparing and implementing the plan and represent the costs to a council for project management of the plan. It does not include costs that are part of a council’s business as usual, such as their core strategic planning responsibilities. 

Plan administration costs can include: 

• background studies, concept plans and cost estimates required to prepare the plan 
• project management and employment costs for preparing, implementing and coordinating the plan 

Plan administration costs are separate from the project management cost associated with delivering infrastructure items. These costs are part of the cost of the infrastructure itself.  

Some section 7.11 contribution plans can only fund items on the essential works list 

Section 7.11 plans must rigorously establish nexus for each piece of infrastructure and can only fund the costs of infrastructure that can be apportioned to development.  

Additionally, some section 7.11 plans are restricted to funding only items on a list called the essential works list. The essential works list only applies to section 7.11 plans with approved contribution rates above the thresholds set by the Minister. These plans must be reviewed by IPART and can only charge contributions for infrastructure on this list. 

Further information on the essential works list and the IPART review process is provided in the IPART review module in the section 7.11 contributions practice note. 

Best practice guidance 

Councils should budget for costs not included in the contributions plan 

Some costs, such as recurrent funding and the part of the infrastructure cost that cannot be apportioned to new development, cannot be recovered through infrastructure contributions.  

However, it is important that they are considered, quantified and documented, as they will impact council’s recurrent budget. See the module on financial management in the Administering contributions practice note for more information on budgeting for and incorporating such costs.