Growth Areas Infrastructure Contribution
The Growth Areas Infrastructure Contribution, or GAIC, is a charge designed to contribute to the funding of essential State infrastructure in Melbourne's growth areas.
An entity liable to pay a Growth Areas Infrastructure Contribution can, by agreement with the government, offset part or all of its liability by providing land or infrastructure works to the State, or a combination of land and works. This is known as Work-in-Kind or WIK.
Operation of the Growth Areas Infrastructure Contribution began on 1 July 2010 and applies to growth area land brought within the Urban Growth Boundary in 2005-06, 2010 or 2012 and zoned for urban development.
The Growth Areas Infrastructure Contribution is administered under Part 9B of the Planning and Environment Act 1987 (the Act) and the Taxation Administration Act 1997.
Under the Act the Metropolitan Planning Authority (formerly the Growth Areas Authority), has responsibility for administering the Growth Areas Infrastructure Contribution legislation and determining related policy.
Growth Areas Infrastructure Contribution Work-in-Kind Agreements and Guidelines
Work-in-Kind agreements will allow a GAIC Liable Entity (GLE) to provide land and/or capital infrastructure works in a growth area in lieu of a cash payment of Growth Areas Infrastructure Contribution. To assist GLEs considering entering into a Work-in-Kind agreement, and to facilitate the negotiation of agreements, the Department of Transport, Planning and Local Infrastructure has prepared two model agreements:A model agreement which provides for the GLE to deliver capital infrastructure works (with or without land) in lieu of a cash payment:
A model agreement which provides for the GLE to transfer land in lieu of a cash payment:
GLEs interested in entering into an agreement should initially contact the Metropolitan Planning Authority. Two forms are available to assist GLEs in developing their proposals:
The Work-in-Kind Guidelines relate to the establishment and administration of Work-in-Kind agreements and explain why the model agreements are drafted as they are and how the model agreements work:
The Guidelines should be read in conjunction with Part 9B of the Planning and Environment Act 1987 and the model Work-in-Kind agreements. If there is any inconsistency between these Work-in-Kind Guidelines and the model agreements concerning the operation of the model agreements then the model agreements prevail.
The Guidelines were prepared by the Department of Transport, Planning and Local Infrastructure and the Metropolitan Planning Authority, in consultation with the Department of Treasury and Finance and the State Revenue Office. The development industry was consulted during the preparation of these Work-in-Kind Guidelines.
Growth Areas Infrastructure Contribution rates for 2014-15
Section 201SG(5) of the Planning and Environment Act 1987 requires the Growth Areas Infrastructure Contribution to be adjusted annually according to the formula set out in the Act and for this amount to be published by the Minister for Planning by 1 June each year. The adjusted amount will come into effect from 1 July each year.
The adjusted Growth Areas Infrastructure Contribution amounts for 2014-15 are:
Land Type GAIC Rate (per hectare) Type A $88,770 Type B-1 or B-2 $105, 420 Type C $105,420
The adjusted threshold amount for building works can be found on the Metropolitan Planning Authority website.
The adjusted indexation of deferred Growth Areas Infrastructure Contribution and interest payable on that deferred Growth Areas Infrastructure Contribution can be found on the State Revenue Office website.
Growth Areas Infrastructure Contribution funds
Money raised by the Growth Areas Infrastructure Contribution is paid by the Commissioner of State Revenue into two special purpose accounts established to fund State infrastructure and services in the growth areas. The funds are established under section 201V of the Planning and Environment Act 1987 and are called:
- the Building New Communities Fund
- the Growth Areas Public Transport Fund.
Under the Act, this funding can only be used for the purposes of State funded infrastructure, including State funded public transport infrastructure, other transport infrastructure such as walking and cycling infrastructure, and regional community, environmental or economic infrastructure that is funded by the Victorian Government.
The Growth Areas Infrastructure Contribution cannot be used to fund neighbourhood or local infrastructure, or infrastructure funded through development contribution payments.
Similarly, the works or land delivered under a Work-in-Kind agreement must be of a type able to be funded from one of the two Growth Areas Infrastructure Contribution Funds.