The Planning and Environment Amendment (Growth Areas
Infrastructure Contribution) Act 2011 received assent on 29
June 2011, with operation commencing on 30 June 2011. The changes
are intended to reduce developer holding costs and place downward
pressure on housing affordability. They also aim to enable some
infrastructure in growth areas to be brought forward.
The Growth Areas Infrastructure Contribution
(GAIC) is a scheme under the Planning and
Environment Act 1987 that applies to land brought into the urban
growth boundary in 2005-2006 and 2010 that is zoned for urban
development. The amending Act:
establishes a new scheme whereby a developer can discharge all
or part of its GAIC liability by entering 'Work-in-Kind
Agreements' (WIK Agreements) with the
allows for deferral of the entire GAIC payment until the end of
the subdivision process
makes consequential and miscellaneous amendments to the GAIC
scheme and related Acts.
Under the previous arrangements, GAIC payments were generally
required up-front, at the point of transfer when a person bought
land or when a person made a significant acquisition in a 'land
rich landholder' company. There were special provisions that
allowed for staged payments or deferral of up to 70% of the GAIC
until the end of the subdivision process.
A WIK Agreement now allows a party required to make a GAIC
payment to discharge its liability through building infrastructure
on behalf of government rather than making a payment to Treasury.
Such a party may enter a WIK Agreement with the Minister in
relation to proposed works in a growth area. The Minister may
approve it after consulting any other Minister who has an interest
in the proposal. If the value of the work-in-kind proposal exceeds
$2 million, the Minister must also obtain the approval of the
Treasurer. However, in a statement to the Australian Financial
Review on 28 June 2011, Victorian Planning Minister Matthew
Guy said that all WIK Agreements would be signed off by the
Department of Treasury and Finance. The burden of a WIK Agreement
must be registered on the title of the land subject to the WIK
Agreement and runs with the land.
The GAIC payment amount in the 2010/2011 financial year ranged
from $80,000-$95,000 per hectare. The land or works to be provided
under a WIK Agreement must be either land acquisition or capital
works for state-funded public transport infrastructure in a growth
area (ie that could be funded from the Growth Areas Public
Transport Fund under s 201VA), or land or works in a growth area
that could be funded from the Building New Communities Fund under s
transport infrastructure that is not public transport
community infrastructure, including health, education and major
environmental infrastructure, including regional open space,
trails and creek protection
economic infrastructure, including access to information
technology and infrastructure supporting the development of
commerce and industry
the acquisition of land necessary to establish or maintain the
The Act requires that the Department and Growth Areas Authority
state the total value and 'the details' of WIK Agreements
performed or partly performed in their annual reports. Mr Guy told
the Australian Financial Review that it would be Coalition
policy to publicly disclose the value of each project in the
GAA's annual report.
The Act does not require that WIK Agreements provide works
proposed in precinct structure plans. Mr Guy dismissed concerns
expressed by councils that they would receive infrastructure that
they did not request, stating 'it will be a piece of state
infrastructure, and state cabinet will decide whether it goes ahead
With its breadth of experience in large and small developments
in Victoria, DLA Piper can help you to:
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